Contingent Liability, Contingent Asset and Provisions

Contingent liability

Contingent liabilities are possible obligations that arise from past events and whose existence will only be
confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the Company. Where it is not probable that an outflow of economic benefits will be required, or the
amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the
probability of outflow of economic benefits is remote.

Contingent assets

Contingent assets are possible assets that arises from past events and whose existence 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.

Provisions

The Company creates a provision when there is present obligation as a result of a past event that probably
requires an outflow of resources and a reliable estimate can be made of the amount of obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected
future cash flows (representing the best estimate of the expenditure required to settle the present obligation
at the balance sheet date) at a pre-tax rate that reflects current market assessments of the time value of
money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

(xv) Cash and cash equivalents

Cash and cash equivalents includes cash on hand, other short-term, highly liquid investments with original
maturities of three months or less that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within
borrowings in current financial liabilities in the balance sheet.

(xvi) Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equity
shareholders by the weighted average number of equity shares outstanding during the period. The weighted
average numbers of equity shares outstanding during the period are adjusted for events such as bonus
issue, share split or consolidation of shares.

For calculating diluted earnings per share, the net profit or loss for the year attributable to equity
shareholders and the weighted average number of shares outstanding during the period are adjusted for the
effects of all dilutive potential equity shares. The dilutive potential equity shares are deemed converted into
equity shares as at the beginning of the period, unless they have been issued at a later date.

(xvii) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker.

In accordance with Ind AS 108 - Operating Segments, the operating segments used to present segment
information are identified on the basis of internal reports used by the Company's Management to allocate
resources to the segments and assess their performance.

Segment profit is used to measure performance as management believes that such information is the most
relevant in evaluating the results of certain segments relative to other entities that operate within these
industries. Inter-segment pricing is determined on an arm's length basis.

The operating segments have been identified on the basis of the nature of products/services. Further:

1. Segment revenue includes sales and other income directly identifiable with / allocable to the segment.

2. Expenses that are directly identifiable with / allocable to segments are considered for determining the
segment result. Expenses which relate to the Company as a whole and not allocable to segments are
included under unallowable expenditure.

3. Income which relates to the Company as a whole and not allocable to segments is included in
unallowable income.

4. Segment assets and liabilities include those directly identifiable with the respective segments.
Unallowable assets and liabilities represent the assets and liabilities that relate to the Company as a
whole and not allocable to any segment.

The Board of Director(s) are collectively the Company's ‘Chief Operating Decision Maker' or ‘CODM'
within the meaning of Ind AS 108.

(xviii) Dividends paid

Dividend to shareholders is recognised as a liability and deducted from equity, in the year in which the
dividends are approved by the shareholders. However, interim dividends, if any, declared by the Board of
directors, which does not need shareholder's approval, are recognised as a liability and deducted from
retained earnings, in the year in which the dividends are so declared.