1.3.9 Provisions and contingent liabilities
Provisions are recognized when there is a presentlegal or constructive obligation that can be estimatedreliably, as a result of a past event, when it is probablethat an outflow of resources embodying economicbenefits will be required to settle the obligation anda reliable estimate can be made of the amount of theobligation.
Provisions are reviewed at each reporting date andadjusted to reflect the current best estimate. If it is nolonger probable that an outflow of economic resourceswill be required to settle the obligation, the provisionsare reversed. Where the effect of the time value ofmoney is material, provisions are discounted using acurrent pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounting isused, the increase in the provisions due to the passageof time is recognized as a finance cost.
Contingent liabilities are disclosed when there is a possible obligationarising from past events, the existence of which will be confirmed only bythe occurrence or non-occurrence of one or more uncertain future eventsnot wholly within the control of the Company or a present obligation thatarises from past events where it is either not probable that an outflow ofresources will be required to settle the obligation or a reliable estimate ofthe amount cannot be made.
1.3.10 Earnings per share
The Company presents basic and diluted earnings pershare (“EPS”) data for its ordinary shares. Basic EPS iscalculated by dividing the profit or loss attributable toordinary shareholders of the Company by the weightedaverage number of ordinary shares outstanding duringthe period. Diluted EPS is determined by adjusting theprofit or loss attributable to ordinary shareholders andthe weighted average number of ordinary sharesoutstanding for the effects of all dilutive potentialordinary shares, which includes all stock options grantedto employees.
1.3.11Functional and Reporting Currency:
The Company’s functional and reporting currency is Indian National Rupee.
• Initial Recognition:
Foreign currency transactions are recorded in thereporting currency, by applying to the foreigncurrency amounts the exchange rate betweenthe reporting currency and the foreign currencyat the date of the transaction.
• Conversion on reporting date:
Foreign currency monetary items are reportedusing the closing rate with reference to RBI ratenon-monetary itemsthat are measured in terms of historical costing a foreign currency is translated usingthe exchange rates at the dates of the initialtransactions.
• Exchange Differences:
Exchange difference arising on the settlementof monetary items or on reporting monetaryitems of Company at rates different from thoseat which they were initially recorded during theyear or reported in previous financial statementsare recognized as income or as expenses in theyear in which they arise.
1.3.11 Employee Benefits
• Defined Contribution Plan
Employer's contribution to Provident Fund/Employee State Insurance which is in the natureof defined contribution scheme is expensed offwhen the contributions to the respective fundsare due. There are no other obligations otherthan the contribution payable to the fund.
• Defined Benefit Plan
a. Gratuity
Gratuity liability is definedbenefit obligation. Such liability is providedonly for employees who have completed 5 years of continuous service as per the provisions of the Payment of Gratuity Act, 1972.
b. Compensated absences
Compensated absences which are defined benefit obligation are provided for based on number of leaves outstanding as on balance sheet date according to the policy of the company.
1.3.12 Dividends
Annual dividend distribution to the shareholders is recognized as a liability in the period in which the dividend is approved by the shareholdersin Statement of changes in Equity. Any interim dividend paid is recognized on approval by Board of Directors.
1.3.13 Investment property
i. Assets which are held for long-term rental yields or for capital appreciation or both, are classified as Investment Properties. Investment properties are measured initially at cost, including transaction osts. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any. The Company has elected to regard previous GAAP carrying values of investment properties as deemed cost at the date of transition to Ind AS.
ii. The Company depreciates investment properties over their estimated useful lives, as specified in Schedule II to the Companies Act, 2013.
iii. Investment properties are derecognised either when they have been disposed off or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in Statement of Profit and Loss in the period in which the property is derecognized.
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into level 1 to level 3 as described below.
Level 1 - Quoted prices in an active market:
This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists of mutual fund investments.
Level 2 - Valuation techniques with observable inputs:
This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). There are no Financial Instruments to be classified under this category.
Level 3 - Valuation techniques with significant unobservable inputs:
This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. There are no Financial Instruments to be classified under this category.
33.2.7 Financial Risk Management Objectives and Policies
The company is exposed to financial risks arising from its operations and the use of financial instruments. The key financial risks include interest rate risk, foreign currency risk, market risk, credit risk and liquidity risk. The company has a risk management policy which not only covers the foreign exchange risks, but also other risks associated with financial assets and liabilities such as interest rate risks and credit risks. The risk management framework aims to:
1. Create a stable business planning environment by reducing the impact of currency and interest rate fluctuations on the company’s business plan.
2 .Achieve greater predictability to earnings by determining the financial value of the expected earnings in advance.
The following sections provide the details regarding the Company’s exposure to the financial risks associated with financial instruments held in the ordinary course of business and the objectives policies and processes for the management of these risks.
(i) Market Risk:
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk currency rate risk, interest rate risk and other price risks such as equity risk. Financial instruments affected by market risk include deposits and mutual funds.
a. Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of the Company and the Company’s financial instruments will fluctuate because of changes in market interest rates. Since the Company has no interest-bearing debts, exposure to interest rate risk is minimal.
b. Foreign Currency Risk
Currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates. Currency risk arises when transactions are denominated in foreign currencies. The Company has no transactional currency exposures arising from goods supplied or received that are denominated in a currency other than the functional currency. Hence exposure to foreign currency risk is Nil.
c. Other price risk
Other price risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk) whether those changes are caused by factors specific to the individual financial instrument or its issuer or by factors affecting all similar financial instruments traded in the market.
(ii) Credit Risk:
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The credit risk arises from its operation activity primarily from trade receivable and from its financial activity. Customer credit risk is controlled by analysis of credit limit and credit worthiness of the customer on a continuous basis to whom the credit has been granted.
Long outstanding receivable from customer are regularly monitored. The maximum exposure to credit risk at the reporting date is the carrying value of trade and other receivable.
(iii) Liquidity Risk:
The risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.
The company ensures that it has sufficient cash on demand to meet expected operational demands including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted.
The table below summarizes the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments:
xiv. The Company has not applied for any Schemes of Arrangements under sections 230 to 237 of the
Act
xv. a) The Company has not advanced to or loaned to or invested funds in any other person(s) or entity(ies), including foreign entities (intermediaries) with understanding that such intermediaries shall:
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The Company has not received any funds from any person(s) or entity(ies), including foreign entities (funding party) with understanding (whether recorded in writing or otherwise):
(i ) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by funding party (Ultimate Beneficiaries) or
(ii)provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
33.5 there is no additional information to disclose as required by para 7 of the General Instructions on
P & L preparation given in Part II of the DIVN II of Schedule III to the Companies Act 2013 for the year under report other than the disclosed at the appropriate places
i. Undisclosed income-The company has no transactions that were not recorded in books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under Income tax act 1961.
ii. The Company is not covered under the obligation to incur CSR Expenditure as per section 135 of the Companies Act, 2013.
iii. The Company has not invested or traded in Crypto currency or Virtual Currency.
33.6 Previous Year’s figures have been reclassified, wherever necessary so as to conform with those of Current Year.
33.7 Recent accounting pronouncements:
The Ministry of Corporate Affairs (MCA) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended 31st March 2024 MCA has not notified any new standard or amendments to the existing standards applicable to the Company.
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