L. Provision, Contingent liabilities and Contingent Assets
A provision is recognized if, as a result of a past event, the Company has a present legal
obligation that is reasonably estimable, and it is probable that an outflow of economic
benefits will be required to settle the obligation. Provisions are determined by the best
estimate of the likely future outflow of economic benefits required to settle the obligation
at the reporting date.
Where no reliable estimate can be made, a disclosure is made as contingent liability. A
disclosure for a contingent liability is also made when there is a possible obligation or a
present obligation that may, but probably will not, require an outflow of resources.
Where there is a possible obligation or a present obligation in respect of which the
likelihood of outflow of resources is remote, no provision or disclosure is made.
A contingent liability also arises in extremely rare cases where there is a liability that cannot
be recognized because it cannot be measured reliably. The company does not recognize a
contingent liability but discloses its existence in the Standalone financial statements.
M. Cash and Cash Equivalents
Cash and cash equivalents comprises cash at banks and short term deposits that are readily
convertible into cash and which are subject to an insignificant risk of changes in value.
N. Borrowing Cost
Borrowing cost that are directly attributable to the acquisition, construction or production
of a qualifying asset are capitalised as part of the asset's cost. Qualifying assets are assets
that necessarily take a substantial period of time to get ready for their intended use or sale.
Capitalisation of borrowing costs commences when the conditions specified under AS 16
are met and continues until substantially all activities necessary to prepare the qualifying
asset for its intended use or sale are complete.
All other borrowing costs are recognised as an expenses in the Statement of Profit and Loss
account in the year in which they are incurred.
O. Related Party Disclosures
Related parties as defined under Accounting Standard - 18 ‘Related Party Disclosures' have
been identified based on representations made by management and information available
with the Company. All transactions with related parties are in the ordinary course of
business and on arms' length basis.
P. Foreign Currency Transactions
These financial statements are presented in Indian rupees, which is the functional currency
of Macfos Limited. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction. Foreign currency denominated
monetary assets and liabilities are re-measured into the functional currency at the
exchange rate prevailing on the balance sheet date and exchange differences are
recognised in the statement of Profit and Loss.
Q. Cash Flow Statement
The cash flow Statement has been prepared under the “Indirect Method” as set out in
Accounting standard -3 “Cash Flow Statement” whereby net profit before tax is adjusted for
the effects of the transactions of a non cash nature and any deferral or accrual of past or
future cash receipts or payments. The cash flow from regular operating, investing and
financing activities of the company are segregated.
R. Employee BenefitsShort term employee benefits
Short-term employee benefits are expensed as the related service is provided. A liability is
recognised for the amount expected to be paid if the Company has a present legal or
constructive obligation to pay this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.
Post-Employment Benefitsa. Defined Contribution Plans (ESIC/PF)
A defined contribution plan is a post-employment benefit plan under which a Company
pays fixed contribution into a separate entity and will have no legal or constructive
obligation to pay further amounts.
Obligations for contributions to defined contribution plans are expensed as the related
service is provided. Prepaid contributions are recognised as an asset to the extent that a
cash refund or a reduction in future payments is available.
b. Defined benefit Plans (Gratuity)
The Company pays gratuity to the employees who have completed five years of service with
the Company at the time when employee leaves the Company.
Provisions are recognised as per Actuarial Valuation by an independent actuary using the
Projected Unit Credit Method, which recognizes each period of service as giving rise to
additional unit of employee benefit entitlement and measures each unit separately to build
up the final obligation.
The company is following the non- funded method for gratuity.
S. Leases
The company has taken office Premises & Warehouse on lease for the period of 5 Year &
classified as an Operating lease and lease rentals are recognized on a straight-line basis over
the lease term.
T. Segment Reporting
The Company is having single segment, Accordingly AS-17 Segment Reporting is not
applicable to the company
U. Subsequent Events occurred after the Balance sheet date
No subsequent events are occurred after the balance sheet date.
V. Corporate Social Responsibility (CSR)
Pursuant to Section 135 of the Companies act, 2013, applicable companies are required to
allocate at least 2% of their average net profit for the immediately preceding three financial
years towards CSR activities.
CSR activities encompass areas specified in Schedule VII of the Companies Act, 2013,
including eradication of hunger and malnutrition, promoting education, art and culture,
healthcare, destitute care and rehabilitation, environment sustainability, disaster relief, and
rural development projects.
Funds allocated for CSR activities are primarily directed towards specific projects
throughout the year, as approved by the CSR Committee established in accordance with
Section 135 of the Companies Act, 2013.
W. Significant Accounting Judgements, Estimates and Assumptions.
In the application of the Company's accounting policies, Management is required to make
judgements, estimates and assumptions about the carrying amounts of assets and
liabilities that are not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimates are revised if the
revision affects only that period or in the period of the revision and future periods if the
revision affects both current and future periods.
Key sources of estimation uncertainty.
The following are the key assumptions concerning the future, and other key sources of
estimation uncertainty at the reporting date, that have a significant risk of causing a
material adjustment to the carrying amount of assets and liabilities within the next financial
year:
a. Useful lives of property, plant and equipment and intangible assets.
The Company has estimated useful life of each class of assets based on the nature of assets,
the estimated usage of the asset, the operating condition of the asset, past history of
replacement, anticipated technological changes, etc. The Company reviews the useful life
of property, plant and equipment and intangible assets as at the end of each reporting
period. This reassessment may result in change in depreciation and amortisation expense
in future periods.
b. Defined Benefit plans.
The cost of the defined benefit plans and the present value of the defined benefit obligation
are based on actuarial valuation using the projected unit credit method. An actuarial
valuation involves making various assumptions that may differ from actual developments in
the future. These include the determination of the discount rate, future salary increases and
mortality rates.
X. Others
1. Regrouping - Figures have been rearranged and regrouped wherever practicable and
considered necessary.
2. Benami property - The Company does not have any Benami property, where any
proceeding has been initiated or pending against the Company for holding any Benami
property
3. Struck Off Co. - The Company has performed the assessment to identify transactions with
struck off companies as at 31st March, 2026 and identified no company with any
transactions.
4. Crypto / Virtual currency - The Company has not traded or invested in crypto currency or
virtual currency during the financial year.
5. Fund Advanced - No funds have been advanced or loaned or invested either from
borrowed funds or share premium or any other sources or kind of funds by the Company
to or in any other person or entity, including foreign entities (‘Intermediaries'), with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall,
whether, 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 provide
any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
6. Funds Raised - No funds have been received by the Company from any person or entity,
including foreign entities (‘Funding Parties'), with the understanding, whether recorded
in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or
invest in other persons or entities identified in any manner whatsoever by or on behalf of
the Funding Party (‘Ultimate Beneficiaries') or provide any guarantee, security or the like
on behalf of the Ultimate Beneficiaries.
7. Willful default - The Company has not been declared willful defaulter by any bank or
financial institution or Government or any Government authority
8. Trade payables/ Trade Receivable - The balances of trade payables, trade receivables,
loans, and advances are unsecured and considered good and are subject to confirmations
of the respective parties concerned.
9. Realizations - In the opinion of the Board and to the best of its knowledge and belief, the
value on the realization of current assets and loans and advances are approximate of the
same value as stated.
10. Contractual liabilities - All other contractual liabilities connected with the business
operations of the Company have been appropriately provided for.
11. Reconciliation of form 2A/2B:- GST input Credit is reconciled monthly with GST 2A/2B.
GST Liability or refund is subject to Annual Return under GST Act, as amended to date.
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