Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised when the Company has a
present obligation (legal or constructive) as a result of
a past event. It is probable that an outflow of resources
embodying economic benefits will be required to settle
the obligation and a reliable estimate can be made of the
amount of the obligation. If the effect of the time value
of money is material, provisions are discounted using
equivalent period government securities interest rate.
Unwinding of the discount is recognised in the statement
of profit and loss as a finance cost. Provisions are reviewed

at each Balance Sheet date and are adjusted to reflect the
current best estimate.

Contingent liabilities are disclosed when there is a possible
obligation arising from past events, the existence of
which will be confirmed only by the occurrence or non¬
occurrence of one or more uncertain future events not
wholly within the control of the Company or a present
obligation that arises from past events where it is either not
probable that an outflow of resources will be required to
settle or a reliable estimate of the amount cannot be made.
Information on contingent liability is disclosed in the Notes
to the Standalone Financial Statements. Contingent assets
are not recognised in standalone financial statement.
However, when the realisation of income is virtually certain,
then the related asset is no longer a contingent asset, but it
is recognised as an asset.

(R) Segment reporting:

Operating segments are reported in a manner consistent
with the internal reporting provided to the Chief Operating
Decision Maker (CODM) of the Company. The CODM
is responsible for allocating resources and assessing
performance of the operating segments of the Company.

(S) Cash and cash equivalents:

Cash and cash equivalents in the Balance Sheet comprise
cash at banks, cash on hand and short-term deposits with
an original maturity of three months or less, which are
subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and
cash equivalents consist of cash and short-term deposits,
as defined above, net of outstanding bank overdrafts as
they are considered an integral part of the Company’s cash
management.

(T) Earnings per share:

Basic earnings per share is computed using the net profit
or loss for the year attributable to the shareholders’ and
weighted average number of equity shares outstanding
during the year.

Diluted earnings per share is computed using the net
profit or loss for the year attributable to the shareholders’
and weighted average number of equity and potential
equity shares outstanding during the year including share
options, convertible preference shares and debentures,
except where the result would be anti-dilutive. Potential
equity shares that are converted during the year are
included in the calculation of diluted earnings per share,
from the beginning of the year or date of issuance of such
potential equity shares, to the date of conversion.

(U) Current / Non-current classification:

The Company presents assets and liabilities in statement
of financial position based on current/non-current
classification.

The Company has presented non-current assets and
current assets before equity, non-current liabilities and
current liabilities in accordance with Schedule III, Division
II of Companies Act, 2013 notified by Ministry of Corporate
Affairs (MCA).

An asset is classified as current when it is:

a) Expected to be realised or intended to be sold or
consumed in normal operating cycle,

b) Held primarily for the purpose of trading,

c) Expected to be realised within twelve months after
the reporting period, or

d) Cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least
twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified as current when it is:

a) Expected to be settled in normal operating cycle,

b) Held primarily for the purpose of trading,

c) Due to be settled within twelve months after the
reporting period, or

d) There is no unconditional right to defer the
settlement of the liability for at least twelve months
after the reporting period.

All other liabilities are classified as non-current.

The operating cycle is the time between the acquisition of
assets for processing and their realisation in cash or cash
equivalents. Deferred tax assets and liabilities are classified
as non-current assets and liabilities. The Company has
identified twelve months as its operating cycle.

(V) Offsetting financial instruments:

Financial assets and liabilities are offset and the net
amount is reported in the Balance Sheet where there is a
legally enforceable rights to offset the recognised amounts
and there is an intention to settle on a net basis or realise
the asset and settle the liability simultaneously. The legally
enforceable rights must not be contingent on future events
and must be enforceable in the normal course of business
and in the event of default, insolvency or bankruptcy of the
Company or counterparty.

(W) Held for Sale:

Non-Current Assets are classified as Held for Sale if their
carrying amount will be recovered principally through a
sale transaction rather than through continuing use. This
condition is regarded as met only when a sale is highly
probable from the date of classification, management
are committed to the sale and the asset is available for
immediate sale in its present condition. Non-Current
Assets are classified as Held for Sale from the date these
conditions are met and are measured at the lower of
carrying amount and fair value less cost to sell. Any
resulting impairment loss is recognised in the statement of
profit and loss as a separate line item. On classification as
Held for Sale, the assets are no longer depreciated. Assets
and liabilities classified as Held for Sale are presented
separately as current items in the Balance Sheet.

1.4 KEY ACCOUNTING ESTIMATES AND JUDGEMENTS

The preparation of the Company’s standalone financial
statements requires the management to make judgements,
estimates and assumptions that affect the reported amounts of
revenues, expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities.
Uncertainty about these assumptions and estimates could result
in outcomes that require a material adjustment to the carrying
amount of assets or liabilities affected in future periods.

a) Depreciation/amortisation and useful lives of
Property, plant and equipment/intangible assets:

Property, plant and equipment/intangible assets are
depreciated/amortised over the estimated useful lives of
the assets, after taking into account their estimated residual
value. Management reviews the estimated useful lives and
residual values of the assets annually in order to determine
the amount of depreciation/ amortisation to be recorded
during any reporting period. The useful lives and residual
values are based on the Company’s historical experience
with similar assets and take into account anticipated
technological changes. The depreciation/ amortisation
for future periods is revised if there are significant changes
from previous estimates.

b) Provisions:

Provisions and liabilities are recognized in the period when
it becomes probable that there will be a future outflow
of funds resulting from past operations or events and the
amount of cash outflow can be reliably estimated. The
timing of recognition and quantification of the liability
require the application of judgement to existing facts and
circumstances, which can be subject to change. Since the
cash outflows can take place many years in the future, the
carrying amounts of provisions and liabilities are reviewed
regularly and revised to take account of changing facts and
circumstances.

c) Defined benefit obligation:

The cost of post-employment benefits is determined using
actuarial valuations. The actuarial valuation involves
making assumptions about discount rates, future salary
increases, expected rate of return on assets and mortality
rates. Due to the long term nature of these plans, such
estimates are subject to significant uncertainty.

d) Income Tax:

Company reviews at each balance sheet date the carrying
amount of deferred tax assets. The factors used in estimates
may differ from actual outcome which could lead to an
adjustment to the amounts reported in the Standalone
Financial Statements. Deferred tax assets are recognised
only to the extent that it is probable that taxable profit
will be available against which the unused tax losses or
tax credits can be utilised. This involves an assessment of
when those assets are likely to reverse, and a judgement
as to whether or not there will be sufficient taxable profits
available to offset the assets. This requires assumptions
regarding future profitability, which is inherently uncertain.
To the extent assumptions regarding future profitability
change, there can be an increase or decrease in the
amounts recognised in respect of deferred tax assets and
consequential impact in the statement of profit and loss.

e) Impairment of financial assets:

The impairment provisions for financial assets are based
on assumptions about risk of default and expected cash
loss rates. The Company uses judgement in making these
assumptions and selecting the inputs to the impairment
calculation, based on Company’s past history, existing
market conditions as well as forward looking estimates at
the end of each reporting period.

f) Recoverability of trade receivables:

Judgements are required in assessing the recoverability of
overdue trade receivables and determining whether a provision
against those receivables is required. Factors considered
include the credit rating of the counterparty, the amount and
timing of anticipated future payments and any possible actions
that can be taken to mitigate the risk of non-payment.

g) Contingencies:

Management has estimated the possible outflow of
resources at the end of each annual financial year, if any,
in respect of contingencies/claim/litigations against the

Company as it is not possible to predict the outcome of
pending matters with accuracy.

h) Impairment of Non-Financial Assets:

The Company assesses at each reporting date whether
there is an indication that an asset may be impaired. If
any indication exists, or when annual impairment testing
for an asset is required, the Company estimates the asset’s
recoverable amount. An asset’s recoverable amount is
the higher of an asset’s or Cash Generating Units (CGU)
fair value less costs of disposal and its value in use. It is
determined for an individual asset, unless the asset does
not generate cash inflows that are largely independent
to those from other assets or groups of assets. Where the
carrying amount of an asset or CGU exceeds its recoverable
amount, the asset is considered impaired and is written
down to its recoverable amount.

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 the risks specific to the asset.
In determining fair value less cost of disposal, recent market
transactions are taken into account. If no such transactions
can be identified, an appropriate valuation model is used.
These calculations are corroborated by valuation multiples
or other available fair value indicators.

1.5 STANDARDS ISSUED BUT NOT EFFECTIVE

On March 31, 2023, the Ministry of Corporate Affairs (MCA) has
notified Companies (Indian Accounting Standards) Amendment
Rules, 2023. This notification has resulted into amendments in
the following existing accounting standards which are applicable
to company from April 1, 2023:

Ind AS 101 - First-time Adoption of Indian Accounting Standards

Ind AS 102 - Share-based Payment

Ind AS 103 - Business Combinations

Ind AS 107 - Financial Instruments Disclosures

Ind AS 109 - Financial Instruments

Ind AS 115 - Revenue from Contracts with Customers

Ind AS 1 - Presentation of Financial Statements

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates

and Errors

Ind AS 12 - Income Taxes

Ind AS 34 - Interim Financial Reporting

Application of above amended standards are not expected
to have any significant impact on the company’s Standalone
Financial Statements.