BMW Ventures Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

3 Material accounting policies

3.1 Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification, as required by Schedule III to the Act.

An asset is treated as current when it is:

? Expected to be realised or intended to be sold or consumed in normal operating cycle

? Held primarily for the purpose of trading

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

? 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 current when:

? It is expected to be settled in normal operating cycle

? It is held primarily for the purpose of trading

? It is due to be settled within twelve months after the reporting period, or

? 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 and their realisation in cash and cash equivalents. The Company has identified twelve months as its
operating cycle.

3.2 Property, Plant & Equipments

(a) Recognition and initial measurement

Property, plant and equipment are stated at their cost of acquisition or construction. The cost comprises purchase price, borrowing cost if capitalization criteria are met
and directly attributable cost of bringing the asset to its working condition for the intended use. Any trade discount and rebates are deducted in arriving at the purchase
price.Subsequent Expenditure is added to the asset''s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Company.

All other repair and maintenance costs are recognized in statement of profit or loss as incurred.

(b) Subsequent measurement (depreciation and useful lives)

Subsequent expenditure is added to the carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the
Company and the cost can be measured reliably. Major inspection / overhaul costs of plant and machinery, where they meet the recognition criteria, are capitalised and
depreciated over the period until the next inspection / overhaul. All other repairs and maintenance costs are charged to the Statement of Profit and Loss in the period in
which they are incurred.

(c) Capital work-in-progress (CWIP)

Assets in the course of construction, installation or commissioning as at the reporting date, and which are not yet ready for their intended use, are disclosed as Capital
Work-in-Progress. CWIP comprises direct costs and related incidental expenses attributable to construction, including trial-run expenses (net of any saleable output
generated during trial runs). Depreciation is not provided on CWIP. CWIP ageing and projects overdue / over-budget are disclosed in the notes in accordance with
Schedule III.

(d) Derecognition:

An item of property, plant and equipment and any significant part initially recognized is de-recognized upon disposal or when no future economic benefits are expected
from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount
of the asset) is recognized in the statement of profit and loss, when the asset is de-recognized.

3.3 Investment Property

Investment property comprises land or buildings (or part of a building, or both) held to earn rentals or for capital appreciation, or both, rather than for: (a) use in
production, supply of goods or services or for administrative purposes; or (b) sale in the ordinary course of business.

Investment property is initially recognised at cost (including transaction costs) and subsequently carried at cost less accumulated depreciation and accumulated
impairment losses, if any, under the cost model permitted by Ind AS 40. Depreciation is provided on the SLM basis over Schedule II useful lives, consistent with PPE.

The fair value of investment property is disclosed in the notes based on a valuation by an independent valuer registered under the Companies (Registered Valuers and
Valuation) Rules, 2017. Such valuations are generally categorised as Level 3 measurements within the fair value hierarchy under Ind AS 113.

Transfers to or from investment property are made when, and only when, there is a change in use, evidenced by commencement of owner-occupation (transfer out) or
commencement of an operating lease (transfer in). De-recognition is upon disposal or permanent withdrawal from use, with gains / losses recognised in the Statement
of Profit and Loss.

3.4 Intangible Assets

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated
amortisation and accumulated impairment losses, if any. Intangible assets with finite useful lives are amortised on the SLM basis over their estimated useful lives:

Class of Intangible Assets Useful Life (in Years)

Computer software — ERP / customised 6

The useful life and method of amortisation are reviewed at the end of each financial year and changes, if any, are accounted for prospectively as a change in accounting
estimate. An intangible asset is de-recognised on disposal or when no future economic benefits are expected, with gains / losses recognised in the Statement of Profit
and Loss.

3.5 Impairment of non-financial assets

At each reporting date, the Company assesses whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the
recoverable amount of the asset, being the higher of (a) fair value less costs of disposal and (b) value in use.

Where the carrying amount exceeds the recoverable amount, the asset is written down to its recoverable amount and the impairment loss is recognised in the
Statement of Profit and Loss. For assets that do not generate independent cash inflows, recoverable amount is determined for the cash-generating unit (CGU) to which
the asset belongs.

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. Such a reversal is made only to the extent that
the asset''s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had
been recognised.

3.6 Leases

The Company assesses, at contract inception, whether a contract is, or contains, a lease (i.e., whether it conveys the right to control the use of an identified asset for a
period of time in exchange for consideration).

(a) Company as Lessee

At the lease commencement date, the Company recognises a right-of-use (ROU) asset and a corresponding lease liability for all lease arrangements where it is a lessee,
except for: (a) short-term leases (term of 12 months or less) and (b) leases of low-value assets (underlying asset, when new, having a value of less than approximately ^4
lakh). For such excluded leases, lease payments are recognised as an expense in the Statement of Profit and Loss on a straight-line basis over the lease term.

ROU asset is initially measured at the amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus initial direct costs
and estimated dilapidation / restoration costs, less any lease incentives received. ROU assets are subsequently amortised on the SLM basis over the shorter of the lease
term and the useful life of the underlying asset.

The lease liability is initially measured at the present value of the lease payments not paid at the commencement date, discounted using the Company''s incremental
borrowing rate. The lease liability is subsequently measured at amortised cost using the effective interest method and is re-measured when there is a change in future
lease payments, change in lease term, change in assessment of a purchase / extension / termination option, or modification.

The Company has elected not to separate non-lease components from lease components and instead accounts for any lease and associated non-lease components as a
single lease component.

(b) Company as Lessor

Leases for which the Company is a lessor (including investment property let out under operating leases) are classified as finance or operating leases based on the
substance of the arrangement. Rental income from operating leases is recognised on a straight-line basis over the lease term.

3.7 Inventories

Inventories are valued at the lower of cost and net realisable value (NRV). Cost is determined on the basis specified for each class of inventory below, and includes all
costs of purchase (net of refundable taxes and trade discounts), costs of conversion (in case of manufactured / fabricated items) and other costs incurred in bringing the
inventory to its present location and condition. NRV is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the
estimated costs necessary to make the sale.

(a) Stock-in-Trade (Traded Goods)

Stock-in-trade comprises long and flat steel products (TMT bars, HR/GP sheets, wire rods, hollow sections, colour-coated sheets, doors, PVC pipes etc.), tractor engines
and spare parts, and other items procured for resale. Stock-in-trade is valued at the lower of cost (determined on First-In-First-Out (FIFO) basis) and NRV. Cost includes
purchase price, non-refundable taxes and duties, and other costs incurred in bringing the goods to their present location and condition.

(b) Raw Materials, Components and Packing Materials

Raw materials and components used in PVC pipe manufacturing (PVC resin, CC & stabilisers etc.) and in PEB / railway-girder fabrication (structural steel plates, sections,
beams, fasteners, welding consumables, paints, primers, galvanising materials) are valued at the lower of cost (determined on the FIFO) and NRV. Cost includes
purchase price, non-refundable duties and taxes, and other costs of bringing the material to the factory location. Materials and supplies held for use in production of
inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

(c) Finished Goods

Finished goods comprise manufactured PVC pipes and fabricated items held in stock (including PEB sub-assemblies and finished girder components not yet allocated to a
specific customer contract). Finished goods are valued at the lower of cost and NRV. Cost includes raw material cost, direct labour, direct overheads, and a systematic
allocation of fixed and variable production overheads based on normal operating capacity (full absorption costing under Ind AS 2).

(d) Stores, Spares, Tools and Consumables

Stores, spares, tools and consumables (including welding consumables, grinding wheels, paint, hardware, etc.) used in manufacturing and fabrication operations are
valued at the lower of cost (determined on FIFO) and NRV. Items expected to be consumed within twelve months are classified as current; items expected to be
consumed beyond twelve months are classified as non-current. Spares meeting the recognition criteria of Ind AS 16 (i.e., expected to be used for more than one period
and used in connection with a specific item of PPE) are capitalised as PPE.

3.8 Cash and Cash Equivalents

Cash and cash equivalents in the Balance Sheet comprise cash on hand, balances with banks in current accounts, and short-term, highly liquid investments with an
original maturity of three months or less from the date of acquisition, which are readily convertible into known amounts of cash and 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
(if any) repayable on demand and forming an integral part of the Company''s cash management.

3.9 Revenue from Contracts with Customers

Revenue is recognised in accordance with Ind AS 115 when control of the goods or services is transferred to the customer, at an amount that reflects the consideration
to which the Company expects to be entitled in exchange for those goods or services. Revenue is measured at the transaction price, net of Goods and Services Tax (GST),
trade discounts, volume rebates, returns and other similar items collected on behalf of third parties.

(a) Five-Step Model

The Company applies the five-step model under Ind AS 115:

Step 1: Identify the contract(s) with a customer
Step 2: Identify the performance obligation in contract
Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation

(b) Distribution and Trading of Steel Products and Sale of Manufactured PVC Pipes

Revenue from the sale of Iron and steel products — including TMT bars, HR / GP sheets, wire rods, hollow sections, galvanised colour-coated sheets, doors and PVC
pipes — is recognised at a point in time when control of the goods is transferred to the customer. Control is generally transferred on dispatch or delivery to the
customer (or to a carrier on the customer''s behalf), in accordance with the agreed Incoterms or the specific terms of the sale contract.

(c) Fabrication of Pre-Engineered Buildings (PEB)

PEB contracts typically involve design, engineering, fabrication, supply and (in some cases) erection of pre-engineered steel buildings. The Company assesses, at contract
inception, whether the contract contains a single combined performance obligation or multiple distinct performance obligations, based on the customer''s ability to
benefit from each item separately and the integration of the items within the contract.

(d) Fabrication of Steel Girders for Indian Railways (RDSO-Approved)

The Company fabricates steel girders for contractors executing railway projects, the contractor being the Company''s customer. As the contracts do not provide an
enforceable right to payment for work completed to date, revenue is recognised at a point in time — on acceptance of the girders by the customer upon completion of
its inspection and dispatch as per the contract. Girders under fabrication or pending inspection are carried as inventories;

(e) Trading of T ractor

Revenue from the sale of tractor is recognised at a point in time when control of the goods is transferred to the customer, generally on dispatch or delivery in
accordance with the agreed terms of sale.

(f) Equipment hire services:

The Company deploys construction equipment together with its own operators for customers'' projects. Revenue from equipment hire services is recognised over the
time as the services are rendered, based on the period of deployment at the contracted rates; charges that vary with usage or shifts are recognised as the related usage
occurs. The equipment continues to be presented within property, plant and equipment and is depreciated in accordance with the Company''s depreciation policy.

(g) Job Work and Processing Services

Revenue from job work services (processing of steel) is recognised over time as the customer simultaneously receives and consumes the benefits, measured using an
appropriate input or output method.

3.10 Employee Benefits

(a) Short-term Employee Benefits:

Employee benefit liabilities such as salaries, wages, bonus and incentives, etc. that are expected to be settled wholly within twelve months after the end of the period in
which the employees render the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at an
undiscounted amount expected to be paid when the liabilities are settled.

(b) Defined Contribution Plans

Provident Fund and Employees'' State Insurance contributions are defined contribution plans. The Company''s contributions, paid or payable, are recognised as an
expense in the Statement of Profit and Loss in the period during which the employee renders the related service. There is no further obligation on the Company beyond
the monthly contribution.

(c) Defined Benefit Plans — Gratuity

The Company operates a defined benefit gratuity plan in accordance with the Payment of Gratuity Act, 1972. The gratuity scheme is funded through a group gratuity
policy with an insurer or a trust set up for the purpose, where applicable.

The Company''s net obligation in respect of the defined benefit gratuity plan is calculated by estimating the amount of future benefit that employees have earned in the
current and prior periods, discounting that amount, and deducting the fair value of any plan assets. The defined benefit obligation is calculated annually by an
independent qualified actuary using the Projected Unit Credit Method. The discount rate used is the yield, at the reporting date, on government bonds with maturity
terms approximating those of the Company''s obligations.

Re-measurements, comprising actuarial gains and losses, the effect of the changes to the asset ceiling is reflected immediately in Other Comprehensive Income in the
Statement of Profit and loss. All other expenses related to defined benefit plans are recognised in Statement of Profit and Loss as employee benefit expenses. Re¬
measurements recognised in Other Comprehensive Income will not be reclassified to Statement of Profit and Loss hence it is treated as part of retained earnings in the
Statement of Changes In Equity.

3.11 Foreign currency transactions

Transactions in foreign currencies are recorded by the Company entities at their respective functional currency at the exchange rates prevailing at the date of the
transaction first qualifies for recognition.

At each reporting date:

• Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate prevailing at the reporhng date;

• Non-monetary items carried at historical cost are translated using the exchange rate at the date of the initial transachon;

• Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.

Exchange differences arising on settlement or translation of monetary items are recognised in the Statement of Profit and Loss in the period in which they arise, except
for exchange differences arising on long-term foreign currency monetary items that qualify for capitalisation under Ind AS 23, which are capitalised as part of the cost of
the underlying qualifying asset.

3.12 Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(a) Initial recognition and measurement

Financial assets and liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument and are initially measured at fair value.
Transaction costs directly attributable to acquisition or issue (other than items measured at FVTPL) are added to / deducted from the fair value on initial recognition.
Investment in a partnership firm is classified as a financial asset measured at fair value through profit or loss.

(b) Classification and Subsequent Measurement — Financial Assets

Financial assets are subsequently measured under one of the following three categories prescribed by Ind AS 109, based on (a) the Company''s business model for
managing the asset and (b) the contractual cash flow characteristics of the asset:

• Amortised cost- for assets held within a business model whose objective is to hold the asset to collect contractual cash flows that are solely payments of principal
and interest (SPPI). Examples: trade receivables, security deposits, loans, fixed deposits.

• Fair value through other comprehensive income (FVTOCI— for debt assets held in a business model achieved by both collecting contractual cash flows and selling,
where contractual terms meet SPPI. Equity investments not held for trading may be irrevocably designated as FVTOCI on initial recognition.

• Fair value through profit or loss (FVTPL— residual category. All other assets, including those designated as such on initial recognition to eliminate an accounting
mismatch. For Investment in Partnership firm, Fair value is determined by reference to the Company''s share in the net assets (capital account balance) of the firm, a
Level 3 measurement. Changes in fair value, including amounts credited to the Company''s capital account out of the results of the firm, are recognised in profit or loss
within other income.

(c) Impairment of Financial Assets — Expected Credit Loss (ECL)

The Company applies the Expected Credit Loss (ECL) model under Ind AS 109.

For trade receivables and contract assets (including unbilled revenue and retention money) that do not contain a significant financing component, the Company applies
the simplified approach and recognises a loss allowance equal to lifetime ECL at each reporting date, using a provision matrix. The provision matrix is built on historical
credit loss experience over the expected life of the receivable, adjusted for forward-looking factors including customer-specific credit deterioration, sectoral outlook for
steel / construction / agricultural-equipment demand, and broader macroeconomic indicators. For receivables from government / public-sector customers (including the
Indian Railways), the credit risk profile is assessed separately based on payment history and known delays.

For other financial assets carried at amortised cost (loans, deposits, other receivables), the Company assesses at each reporting date whether there has been a
significant increase in credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is recognised; if it has, lifetime ECL is recognised.
Where the financial asset becomes credit-impaired, interest income is recognised on the net carrying amount.

(d) Classification and Subsequent Measurement — Financial Liabilities

Financial liabilities are classified, at initial recognition, as financial liabilities at amortised cost or at FVTPL. The Company''s financial liabilities include borrowings, trade
and other payables, lease liabilities, and contract liabilities (where applicable).

Financial liabilities at amortised cost are subsequently measured using the effective interest rate (EIR) method. Gains and losses are recognised in the Statement of
Profit and Loss when the liabilities are de-recognised, as well as through the EIR amortisation process.

(e) Derecognition

A financial asset is de-recognised when the rights to receive cash flows from the asset have expired, or the Company has transferred its rights to receive cash flows and
either (a) has transferred substantially all the risks and rewards, or (b) has neither transferred nor retained substantially all the risks and rewards but has transferred
control.

A financial liability is de-recognised when the obligation under it is discharged, cancelled or expires. The difference between the carrying amount and the consideration
paid is recognised in the Statement of Profit and Loss.

(f) Offsetting

Financial assets and financial liabilities are offset, and the net amount is presented in the Balance Sheet, when, and only when, the Company has a legally enforceable
right to set off and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

3.13 Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement

date, in the principal (or most advantageous) market accessible to the Company. All assets and liabilities for which fair value is measured or disclosed are categorised

within the fair value hierarchy:

• Level 1 — quoted (unadjusted) prices in achve markets for identical assets or liabilities.

• Level 2 — valuahon techniques for which the lowest-level significant input is directly or indirectly observable.

• Level 3 — valuafion techniques for which the lowest-level significant input is unobservable.

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in
the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting
period.

3.14 Borrowing Cost

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets (one that necessarily takes a substantial period of time to get
ready for its intended use or sale) are capitalised as part of the cost of such assets up to the assets are substantially ready for their intended use.

Loan origination costs directly attributable to the acquisition of borrowings (e.g., processing fees, upfront fees) are amortised over the tenure of the related borrowing
using the effective interest rate method, as part of the carrying amount of the borrowing.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs
eligible for capitalization.

All other borrowing costs are expensed in the Statement of Profit and Loss in the period in which they are incurred.

3.15 Income tax

Income tax expense comprises current tax and deferred tax. It is recognised in the Statement of Profit and Loss, except to the extent that it relates to items recognised
directly in equity or in OCI, in which case the related tax is also recognised in equity or in OCI.

(a) Current tax:

Current tax is the expected tax payable or receivable on the taxable income for the year, computed in accordance with the provisions of the Income-tax Act, 1961, using
tax rates enacted or substantively enacted at the reporting date, and includes any adjustment to tax payable or receivable in respect of previous years.

Current tax assets and current tax liabilities are offset only where there is a legally enforceable right of set-off and the Company intends either to settle on a net basis or
to realise the asset and settle the liability simultaneously.

(b) Deferred tax:

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding
amounts used for taxation purposes.

Deferred tax assets are recognised for all deductible temporary differences, carry-forward of unused tax credits, and unused tax losses, to the extent that it is probable
that future taxable profits will be available against which they can be utilised. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply when the asset is realised or the liability is settled, based on the tax rates (and
tax laws) enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset only where a legally enforceable right exists and they relate
to income taxes levied by the same taxation authority.