PFL Infotech Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

Mar 31, 2025

1 Corporate information

PFL INFOTECH LIMITED (“the Company”) was incorporated on 11-12-1986. It was converted to public limited company with effect from 22 January 1993 and is listed on BSE. The Registered office of the Company is situated at H.NO-1-10-122-125/B-2,Flat No.102,Block B2,Radha Krishna Towers,Mayuri Marg Begumpet,Hyderabad-500016. The

2 Basis for preparation of financial statements

2.1 Statement of compliance

These financial statements are prepared under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values. These financial statements comply with Indian Accounting Standard (Ind AS), as prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued there after.

All amounts are in Indian ? lakhs except share data, unless otherwise stated.

All assets and liabilities have been classified as current and non-current as per the Company''s normal operating cycle and other criteria set out in Schedule III of the Companies Act,2013.

Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as twelve months for the purpose of current and non-current classification of assets and liabilities.

Prior year comparatives

Figures have been rounded off to nearest lakhs and previous year figures have been regrouped wherever necessary, to correspond with the current period classification/disclosure and there is no impact on total income and net profit.

2.2 Basis of measurement

These financial statements have been prepared on the historical cost convention and on an accrual basis, except for the following:

• certain financial assets and liabilities are measured at fair value;

• long term borrowings are measured at amortized cost using the effective interest rate method.

• defined benefits plans and plan assets measured at fair value.

2.3 Critical accounting judgements and key sources of estimation

In the application of the Company’s accounting policies, the management of the Company 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 on going basis. Revisions to accounting estimates are recognised in the period in which the estimate is 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.

The following are the areas of estimation uncertainty and critical judgements that the management has made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements:

Provision and contingent liabilities

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an out flow of resources will be required to settle the obligation and the amount can be readily estimated.

Contingent liabilities are disclosed when there is a possible obligation arising from the past events, the existence of which will be confirmed only by occurrence or non-occurrence of one or more uncertain further 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 can not be made.

Where the likelihood of outflow of resources is remote, no provision or disclosure as specified in Ind AS 37 "Provision,

Contingent liabilities and contingent assets" is made.

Useful lives of depreciable assets

Management reviews the useful lives of depreciable assets at each reporting. As at 31 March 2025 management assessed that the useful lives represent the expected utility of the assets to the Company. Further, there is no significant change in the useful lives as compared to previous year.

2.4 Measurement of fair values

A number of the Company’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

3 Significant accounting policies

3.1 Revenue recognition

Revenue from goods and services is recognized, when the Company satisfies a performance obligation by transferring a promised good or service to its customers. The Company considers the terms of the contract and its customary business practices to determine the transaction price. Performance obligations are satisfied at the point of time when the customer obtains controls of the asset.

Revenue is measured based on transaction price, which is the fair value of the consideration received or receivable, stated net of discounts, returns and Goods & services Tax. Transaction price is recognised based on the price specified in the contract, net of the estimated sales incentives/ discounts. Past trends are used to estimate and provide for the discounts/right of return, using the expected value method.

3.2 Leases

As a lessee, the Company mainly has lease arrangement for buildings. The Company assesses whether a contract is or contains a lease at inception of the contract. The assessment involves the exercise of judgement about whether there is an identified asset, whether the Company has the right to direct the use of the asset and whether the Company obtains substantially all the economic benefits from use of that asset.

The Company recognise a right-of- use asset (ROU) and a corresponding lease liability at the lease commencement date. The lease liability is measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate can not be readily determined, the Company uses the incremental borrowing rate.

The ROU assets are initially recognised at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease initiatives. ROU assets are amortised from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying assets. ROU assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.

The lease liability is initially measured at amortised cost at the present value of future lease payments. The lease payments are discounted using the interest rate implicit in the lease or if nor readily determinable, using the incremental borrowing rate. Lease liabilities are remeasured with a corresponding adjustments to the related ROU asset if the Company changes its assessment of whether it will exercise an extension or a termination option.

3.3 Foreign currency transactions

Transaction in foreign currency are translated in functional currency using the exchange rates prevailing at the dates of the respective transactions. Foreign currency monetary items, outstanding at the balance sheet date are restated at year end rates. Non-monetary items are measured in terms of historical cost in foreign currency are not translated again. The exchange differences on monetary items arising, if any are recognised in the statement of Profit and loss in the period in which they arise.

3.4 Taxation

Income tax expense consists of current and deferred tax. Income tax expense is recognized in the statement of Profit and loss except to the extent that it relates to items recognized in the other comprehensive income or directly in the equity, in which case the current and deferred taxes are also recognised in other comprehensive income or directly in equity.

Current tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax

Deferred tax is recognized using the balance sheet approach, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets and liabilities are recognised for deductible temporary differences arising between the tax base of the assets and liabilities and their carrying amounts, except when the deferred income tax arises from the initial recognition of an asset or liability is a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.

Deferred tax are recognised to the extent that it is probable that taxable profit will be available, against which the deductible temporary differences can be utilised.

Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be resolved or settled.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same tax authority and the relevant entity intends to settle its current tax assets and liabilities on a net basis.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

3.5 Earnings per share

The Company presents basic and diluted earnings per share (“EPS”) data for its ordinary shares. The basic earnings per share is computed by dividing the net profit attributable to equity shareholders for the period by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is computed by dividing the net profit attributable to equity shareholders for the year relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share.

3.6 Property, plant and equipment (PPE)

Tangible assets and intangible assets

The initial cost of PPE comprises its purchase price, including import duties and non-refundable purchase taxes, and any directly attributable costs of bringing an asset to working condition and location for its intended use, including relevant borrowing costs and any expected costs of decommissioning, less accumulated depreciation and accumulated impairment losses, if any. Expenditure incurred after the PPE have been put into operation, such as repairs and maintenance, are charged to the Statement of Profit and Loss in the period in which the costs are incurred.

If significant parts of an item of PPE have different useful lives, then they are accounted for as separate items (major components) of PPE.

Material items such as spare parts, stand-by equipment and service equipment are classified as PPE when they meet the definition of PPE as specified in Ind AS 16 - Property, Plant and Equipment. Expenditure during construction period (including financing cost related to borrowed funds for construction or acquisition of qualifying PPE) is included under Capital Work-in-Progress, and the same is allocated to the respective PPE on the completion of their construction.

3.7 Depreciation and amortisation

Depreciation is the systematic allocation of the depreciable amount of PPE over its useful life and is provided on a straight-line basis over the useful lives as prescribed in Schedule II to the Act or as per technical assessment.

Depreciable amount for PPE is the cost of PPE less its estimated residual value. The useful life of PPE is the period over which PPE is expected to be available for use by the Company, or the number of production or similar units expected to be obtained from the asset by the Company

The Company has componentised its PPE and has separately assessed the life of major components. In case of certain classes of PPE, the Company uses different useful lives than those prescribed in Schedule II to the Act. The useful lives have been assessed based on technical advice, taking into account the nature of the PPE and the estimated usage of the asset on the basis of management’s best estimation of obtaining economic benefits from those classes of assets.

Such classes of assets and their estimated useful lives are as under
	Particulars	Useful life (years)
	Buildings	30
	Plant and machinery	15
	Vehicles	8
	Tools and spares	15
	Furniture and fixtures	10
	Computers	3
	Office equipment	5
	Electrical equipment	10
	Intangible assets	5

Depreciation on additions is provided on a pro-rata basis from the month of installation or acquisition and in case of Projects from the date of commencement of commercial production. Depreciation on deductions/disposals is provided on a pro-rata basis up to the date of deduction/disposal.

3.8 Research and development

Expenditures on research activities undertaken with the prospect of gaining new scientific or technical knowledge and understanding are recognized in the statement of profit and loss when incurred.

Development activities involve a plan or design for the production of new or substantially improved products and processes. Development expenditures are capitalized only if development costs can be measured reliably; the product or process is technically and commercially feasible; future economic benefits are probable; and the Company intends to and has sufficient resources to complete development and to use or sell the asset.

Expenditure on research and development eligible for capitalization are carried as tangible assets under development where such assets are not yet ready for their intended use.

The expenditures to be capitalized include the cost of materials and other costs directly attributable to preparing the asset for its intended use. Other development expenditures are recognized as expense in the statement of profit and loss as incurred.

Tangible assets relating to products in development are subject to impairment testing at each reporting date. All other tangible assets are tested for impairment when there are indications that the carrying value may not be recoverable. All impairment losses are recognized immediately in the statement of profit and loss.

The amortization period and the amortization method for tangible assets with a finite useful life are reviewed at each reporting date.

3.9 Intangible assets

Intangible assets including software licenses of enduring nature and contractual rights 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. Cost comprises the purchase price and any directly attributable cost of bringing the asset to its working condition for its intended use.

Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.

Gains or losses arising upon derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed.

3.10 Inventories

Inventories are valued as follows:

• Raw materials, fuel, stores & spare parts and packing materials:

Valued at lower of cost and net realisable value (NRV). However, these items are considered to be realisable at cost, if the finished products, in which they will be used, are expected to be sold at or above cost. Cost is determined on weighted average basis.

• Work-in- progress (WIP), finished goods and stock-in-trade:

Valued at lower of cost and NRV Cost of finished goods and WIP includes cost of raw materials, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost of inventories is computed on weighted average basis.

3.11 Cash and cash equivalents

Cash and cash equivalents in the Balance Sheet comprise cash at bank and in hand and short-term deposits with banks that are readily convertible into cash which are subject to insignificant risk of changes in value and are held for the purpose of meeting short-term cash commitments.

3.12 Impairment of financial and non financial assets

(i) Impairment of financial assets

Non-financial assets other than inventories, deferred tax asset and non-current asset classified as held for sale are reviewed at Balance sheet date to determine whether there is any indication of impairment. If any such indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset recoverable amount. The recoverable amount is higher of the asset’s or Cash-Generating Unit’ (CGU) fair value is less cost of disposal and its value in use. Recoverable amount is determined for individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or group of assets.

When carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

(ii) Impairment of non- financial assets:

In accordance with IND-AS 109, the Company applies expected credit loss (“ECL”) model for measurement and recognition of impairment loss on the financial assets measured at amortized cost and debt instrument measured at FVOCI.

Loss allowances on receivable from customers are measured following the ‘simplified approach’ at an amount equal to the life time ECL, at each reporting date. In respect of other financial assets such as debt securities and bank balances, the loss allowance is measured at 12 month ECL only if there is no significant deterioration in the credit risk since initial recognition of the asset or asset is determined is have a low credit risk at the reporting date.

The Company has carried out annual review of impairment of fixed assets, based on the report of the technical executives it is observed there is no necessity for any impairment.

3.13 Employee benefits Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized 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.

Defined contribution plans (like contribution to provident fund, ESI)

The Company’s contributions to defined contribution plans are charged to the income statement as and when the services are received from the employees.

Defined benefit plan-Gratuity

The liability in respect of defined benefit plans and other post-employment benefits are calculated using the projected unit credit method using actuarial valuation. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related defined benefit obligation. In countries where there is no deep market in such bonds, the market rates on government bonds are used. The current service cost of the defined benefit plan, recognized in the income statement in employee benefit expense, reflects the increase in the defined benefit obligation resulting from employee service in the current year, benefit changes, curtailments and settlements. Past service costs are recognized immediately in income. The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the income statement. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity in other comprehensive income in the period in which they arise.

Termination benefits

Termination benefits are recognized as an expense when the Company is demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognized as an expense if the Company has made an offer encouraging voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably.

3.14 Provisions

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

3.15 Contingent liabilities and contingent assets

A disclosure for a contingent liability is 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.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognised in the period in which the change occurs.

3.16 Financial instruments

a. Recognition and initial recognition

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issues of financial assets and financial liabilities that are not at fair value through profit or loss, are added to the fair value on initial recognition.

A financial asset or financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue.

b. Classification and Subsequent measurement Financial assets

On initial recognition, a financial asset is classified as measured at amortised cost;

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:

- the asset is held within a business model whose objective is to hold assets to collect contractual cash flows; and

- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

All financial assets not classified as measured at amortised cost as described above are measured at FVTPL. On initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Financial assets: Business model assessment

The Company makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes:

- the stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether management’s strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realising cash flows through the sale of the assets;

- how the performance of the portfolio is evaluated and reported to the Company’s management;

- the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed;

- how managers of the business are compensated - e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and

3.17 Financial instruments

Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with the Company’s continuing recognition of the assets.

Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL.

Financial assets: Assessment whether contractual cash flows are solely payments of principal and interest

For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest, the Company considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making this assessment, the Company considers:

- contingent events that would change the amount or timing of cash flows;

- terms that may adjust the contractual coupon rate, including variable interest rate features;

- prepayment and extension features; and

- terms that limit the Company’s claim to cash flows from specified assets (e.g. non- recourse features).

A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable additional compensation for early termination of the contract. Additionally, for a financial asset acquired at a significant discount or premium to its contractual par amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable additional compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.

Financial assets: Subsequent measurement and gains and losses

Financial assets at FVTPL: These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognised in profit or loss.

Financial assets at amortised cost: These assets are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.

Financial liabilities: Classification, Subsequent measurement and gains and losses

Financial liabilities are classified as measured at amortised cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held- for- trading, or it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

c. Derecognition Financial assets

The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control of the financial asset.

If the Company enters into transactions whereby it transfers assets recognised on its balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets, the transferred assets are not derecognised.

Financial liabilities

The Company derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.

The Company also derecognises a financial liability when its terms are modified and the cash flows under the modified terms are substantially different. In this case, a new financial liability based on the modified terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished and the new financial liability with modified terms is recognised in profit and loss statement.

3.18 Recent pronouncements

Ministry of Corporate Affairs ("MCA") notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On 31 March 2024, MCA amended the Companies (Indian Accounting Standards) Amendment Rules, 2023, as below:

Ind AS 1- Presentation of financial statements: This amendment required the entities to disclosure their material accounting policies rather than thir significant accounting policies. The effective date for adoption of this amendment in annual periods beginning on or after 1 April 2024.

Ind AS 8- Accounting policies , changes in Accounting Estimates and Errors: This amendment has introduced a definition of "accounting estimates" and included amendments to Ind As 8 to help entities distinguish changes in accounting policies from changes in accounting estimates. The effective date for adoption of this amendment in annual periods beginning on or after 1 April 2024.

Ind AS 12- Income taxes: The amendment has narrowed the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equal and offsetting temporary differences . The effective date for adoption of this amendment its annual periods beginning on or after 1 April 2024.

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Mar 31, 2024

3 Significant accounting polic
3.1 Revenue recognition

Revenue from goods and services is recognized, when the Company satisfies a performance
obligation by transferring a promised good or service to its customers. The Company considers the
terms of the contract and its customary business practices to determine the transaction price.
Performance obligations are satisfied at the point of time when the customer obtains controls of the
asset.

Revenue is measured based on transaction price, which is the fair value of the consideration
received or receivable, stated net of discounts, returns and Goods & services Tax. Transaction price
is recognised based on the price specified in the contract, net of the estimated sales incentives/
discounts. Past trends are used to estimate and provide for the discounts/right of return, using the
expected value method.

3.2 Leases

As a lessee, the Company mainly has lease arrangement for buildings. The Company assesses whether
a contract is or contains a lease at inception of the contract. The assessment involves the exercise of
judgement about whether there is an identified asset, whether the Company has the right to direct the
use of the asset and whether the Company obtains substantially all the economic benefits from use of
that asset.

The Company recognise a right-of- use asset (ROU) and a corresponding lease liability at the lease
commencement date. The lease liability is measured at the present value of the lease payments that are
not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that
rate can not be readily determined, the Company uses the incremental borrowing rate.

The ROU assets are initially recognised at cost, which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial
direct costs less any lease initiatives. ROU assets are amortised from the commencement date on a
straight-line basis over the shorter of the lease term and useful life of the underlying assets. ROU assets
are evaluated for recoverability whenever events or changes in circumstances indicate that their
carrying amounts may not be recoverable.

The lease liability is initially measured at amortised cost at the present value of future lease payments.
The lease payments are discounted using the interest rate implicit in the lease or if nor readily
determinable, using the incremental borrowing rate. Lease liabilities are remeasured with a
corresponding adjustments to the related ROU asset if the Company changes its assessment of whether
it will exercise an extension or a termination option.

Transaction in foreign currency are translated in functional currency using the exchange rates
prevailing at the dates of the respective transactions. Foreign currency monetary items, outstanding
at the balance sheet date are restated at year end rates. Non-monetary items are measured in terms of
historical cost in foreign currency are not translated again. The exchange differences on monetary
items arising, if any are recognised in the statement of Profit and loss in the period in which they
arise.

3.4 Taxation

Income tax expense consists of current and deferred tax. Income tax expense is recognized in the
statement of Profit and loss except to the extent that it relates to items recognized in the other
comprehensive income or directly in the equity, in which case the current and deferred taxes are
also recognised in other comprehensive income or directly in equity.

Current tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted at the reporting date, and any adjustment to tax payable in respect of
previous years.

Deferred tax

Deferred tax is recognized using the balance sheet approach, providing for temporary differences
between the carrying amounts of assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes. Deferred tax assets and liabilities are recognised for deductible
temporary differences arising between the tax base of the assets and liabilities and their carrying
amounts, except when the deferred income tax arises from the initial recognition of an asset or
liability is a transaction that is not a business combination and affects neither accounting nor
taxable profit or loss at the time of the transaction.

Deferred tax are recognised to the extent that it is probable that taxable profit will be available,
against which the deductible temporary differences can be utilised.

Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to
apply to taxable income in the years in which the temporary differences are expected to be resolved
or settled.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same tax
authority and the relevant entity intends to settle its current tax assets and liabilities on a net basis.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no
longer probable that the related tax benefit will be realized.

3.5 Earnings per share

The Company presents basic and diluted earnings per share (“EPS”) data for its ordinary shares.

The basic earnings per share is computed by dividing the net profit attributable to equity
shareholders for the period by the weighted average number of equity shares outstanding during
the year.

Diluted earnings per share is computed by dividing the net profit attributable to equity shareholders
for the year relating to the dilutive potential equity shares, by the weighted average number of
equity shares considered for deriving basic earnings per share and the weighted average number of
equity shares which could have been issued on the conversion of all dilutive potential equity shares.
Potential equity shares are deemed to be dilutive only if their conversion to equity shares would
decrease the net profit per share.

3.6 Property, plant and equipment
Tangible assets and intangible assets

The initial cost of PPE comprises its purchase price, including import duties and non-refundable
purchase taxes, and any directly attributable costs of bringing an asset to working condition and
location for its intended use, including relevant borrowing costs and any expected costs of
decommissioning, less accumulated depreciation and accumulated impairment losses, if any.
Expenditure incurred after the PPE have been put into operation, such as repairs and maintenance, are
charged to the Statement of Profit and Loss in the period in which the costs are incurred.
If significant parts of an item of PPE have different useful lives, then they are accounted for as separate
items (major components) of PPE.

Material items such as spare parts, stand-by equipment and service equipment are classified as PPE
when they meet the definition of PPE as specified in Ind AS 16 - Property, Plant and Equipment.
Expenditure during construction period (including financing cost related to borrowed funds for
construction or acquisition of qualifying PPE) is included under Capital Work-in-Progress, and the
same is allocated to the respective PPE on the completion of their construction.

There is no potential for the recovery of investments paid to Pride Ventures India Pvt. Ltd
Rs.2,85,00,004/-, Simar Pride Ventures LLP Rs.1,81,26,084/- , City Makers Rs.1,00,00,000/-
aggregating to Rs. 5,66,26,088/-. Hence, the board of directors decided to write off the same in the
F.Y 2023-24.

³-⁷ Depreciation and amortisation

Depreciation is the systematic allocation of the depreciable amount of PPE over its useful life and is provided
on a straight-line basis over the useful lives as prescribed in Schedule II to the Act or as per technical assessment.

Depreciable amount for PPE is the cost of PPE less its estimated residual value. The useful life of PPE is the
period over which PPE is expected to be available for use by the Company, or the number of production or
similar units expected to be obtained from the asset by the Company

The Company has componentised its PPE and has separately assessed the life of major components. In case of
certain classes of PPE, the Company uses different useful lives than those prescribed in Schedule II to the Act.
The useful lives have been assessed based on technical advice, taking into account the nature of the PPE and
the estimated usage of the asset on the basis of management’s best estimation of obtaining economic benefits
from those classes of assets.

Such classes of assets and their estimated useful lives are as under:

Depreciation on additions is provided on a pro-rata basis from the month of installation or acquisition and in
case of Projects from the date of commencement of commercial production. Depreciation on
deductions/disposals is provided on a pro-rata basis up to the date of deduction/disposal.

3.8 Research and development

Expenditures on research activities undertaken with the prospect of gaining new scientific or technical
knowledge and understanding are recognized in the statement of profit and loss when incurred.

Development activities involve a plan or design for the production of new or substantially improved products
and processes. Development expenditures are capitalized only if development costs can be measured reliably;
the product or process is technically and commercially feasible; future economic benefits are probable; and
the Company intends to and has sufficient resources to complete development and to use or sell the asset.

Expenditure on research and development eligible for capitalization are carried as tangible assets under
development where such assets are not yet ready for their intended use.

The expenditures to be capitalized include the cost of materials and other costs directly attributable to
preparing the asset for its intended use. Other development expenditures are recognized as expense in the
statement of profit and loss as incurred.

Tangible assets relating to products in development are subject to impairment testing at each reporting date.

All other tangible assets are tested for impairment when there are indications that the carrying value may not
be recoverable. All impairment losses are recognized immediately in the statement of profit and loss.

The amortization period and the amortization method for tangible assets with a finite useful life are reviewed
at each reporting date.

3.9 Intangible assets

Intangible assets including software licenses of enduring nature and contractual rights 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.
Cost comprises the purchase price and any directly attributable cost of bringing the asset to its
working condition for its intended use.

Intangible assets with finite lives are amortized over the useful economic life and assessed for
impairment whenever there is an indication that the intangible asset may be impaired. The
amortisation period and the amortisation method for an intangible asset with a finite useful life are
reviewed at least at the end of each reporting period. Changes in the expected useful life or the
expected pattern of consumption of future economic benefits embodied in the asset are considered
to modify the amortisation period or method, as appropriate, and are treated as changes in
accounting estimates. The amortisation expense on intangible assets with finite lives is recognised
in the statement of profit and loss unless such expenditure forms part of carrying value of another
asset.

Gains or losses arising upon derecognition of an intangible asset are measured as the difference
between the net disposal proceeds and the carrying amount of the asset and are recognized in the
statement of profit and loss when the asset is disposed.

3.10 Inventories

Inventories are valued as follows:

• Raw materials, fuel, stores & spare parts and packing materials:

Valued at lower of cost and net realisable value (NRV). However, these items are considered to be
realisable at cost, if the finished products, in which they will be used, are expected to be sold at or
above cost. Cost is determined on weighted average basis.

• Work-in- progress (WIP), finished goods and stock-in-trade:

Valued at lower of cost and NRV. Cost of finished goods and WIP includes cost of raw materials,
cost of conversion and other costs incurred in bringing the inventories to their present location and
condition. Cost of inventories is computed on weighted average basis.

3.11 Cash and cash
equivalents

Cash and cash equivalents in the Balance Sheet comprise cash at bank and in hand and short-term
deposits with banks that are readily convertible into cash which are subject to insignificant risk of
changes in value and are held for the purpose of meeting short-term cash commitments.

3.12 Im pairment of financial an d non financial assets

(i) Impairment of financial assets

Non-financial assets other than inventories, deferred tax asset and non-current asset classified as held
for sale are reviewed at Balance sheet date to determine whether there is any indication of impairment.
If any such indication exists, or when annual impairment testing for an asset is required, the Company
estimates the asset recoverable amount. The recoverable amount is higher of the asset’s or Cash¬
Generating Unit’ (CGU) fair value is less cost of disposal and its value in use. Recoverable amount is
determined for individual asset, unless the asset does not generate cash inflows that are largely
independent of those from other assets or group of assets.

When carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount.

(ii) Impairment of non- financial assets:

In accordance with IND-AS 109, the Company applies expected credit loss (“ECL”) model for
measurement and recognition of impairment loss on the financial assets measured at amortized cost
and debt instrument measured at FVOCI.

Loss allowances on receivable from customers are measured following the ‘simplified approach’ at an
amount equal to the life time ECL, at each reporting date. In respect of other financial assets such as
debt securities and bank balances, the loss allowance is measured at 12 month ECL only if there is no
significant deterioration in the credit risk since initial recognition of the asset or asset is determined is
have a low credit risk at the reporting date.

The Company has carried out annual review of impairment of fixed assets, based on the report of the
technical executives it is observed there is no necessity for any impairment.

3.13 Employee benefits
Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is
recognized 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.

Defined contribution plans (like contribution to provident fund, ESI)

The Company’s contributions to defined contribution plans are charged to the income statement
as and when the services are received from the employees.

Defined benefit plan-Gratuity

The liability in respect of defined benefit plans and other post-employment benefits are calculated
using the projected unit credit method using actuarial valuation. The present value of the defined
benefit obligation is determined by discounting the estimated future cash outflows using interest
rates of high-quality corporate bonds that are denominated in the currency in which the benefits
will be paid, and that have terms to maturity approximating to the terms of the related defined
benefit obligation. In countries where there is no deep market in such bonds, the market rates on
government bonds are used. The current service cost of the defined benefit plan, recognized in the
income statement in employee benefit expense, reflects the increase in the defined benefit
obligation resulting from employee service in the current year, benefit changes, curtailments and
settlements. Past service costs are recognized immediately in income. The net interest cost is
calculated by applying the discount rate to the net balance of the defined benefit obligation and
the fair value of plan assets. This cost is included in employee benefit expense in the income
statement. Actuarial gains and losses arising from experience adjustments and changes in actuarial
assumptions are charged or credited to equity in other comprehensive income in the period in
which they arise.

Termination benefits

Termination benefits are recognized as an expense when the Company is demonstrably
committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate
employment before the normal retirement date, or to provide termination benefits as a result of an
offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies
are recognized as an expense if the Company has made an offer encouraging voluntary
redundancy, it is probable that the offer will be accepted, and the number of acceptances can be
estimated reliably.

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Mar 31, 2014

1.1. Accounting Convention

The financial statements are prepared under the historical cost convention in accordance with applicable accounting standards and relevant presentational requirements of the Companies Act, 1956.

1.2. Fixed Assets

"Fixed Assets are stated at cost and include installation charges, freight, duties, taxes and expenditure incurred during construction period wherever applicable. Assets under erection / commissioning are shown as capital work in progress. All expenditure during the construction period is allocated to Buildings and Plant & Machinery in the same proportion of the balances in the respective heads as on the date of commissioning of the project. "

1.3. Depreciation

Depreciation on the fixed assets is provided on Written Down Value Method at the rates and in the manner prescribed in Schedule - XIV to the Companies Act, 1956 for all the assets during the year under consideration.

1.4. Revenue Recognition

The Company follows the mercantile system of accounting and recognises income and expenditure on accrual basis.

1.5. Employee Benefits

"Retirement benefits to the employees have not been provided as no employee is eligible for the same. No Provision has been made in respect of Gratuity Liability. Provident Fund and ESI as no employee is eligible for the same, leave encashment shall be accounted on cash basis"".""

1.6. Provision For Income Tax Provision for Current Tax :

Provision for Income Tax is made taking into consideration the Provisions of Income Tax Act, 1961.

Provision for Deferred Taxation :

As per the AS 22, since there is no reasonable certainty that the Company will get profits so as to absorb the carried forward losses and depreciation, the deferred tax asset has not been recognized in the financial statements.

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Mar 31, 2013

1.1. Accounting Convention

The financial statements are prepared under the historical cost convention in accordance with applicable accounting standards and relevant presentational requirements of the Companies Act, 1956.

1.2. Fixed Assets

Fixed Assets are stated at cost and include installation charges, freight, duties, taxes and expenditure incurred during construction period wherever applicable. Assets under erection / commissioning are shown as capital work in progress. All expenditure during the construction period is allocated to Buildings and Plant & Machinery in the same proportion of the balances in the respective heads as on the date of commissioning of the project.

1.3. Depreciation

Depreciation on the fixed assets is provided on Written Down Value Method at the rates and in the manner prescribed in Schedule - XIV to the Companies Act, 1956 for all the assets during the year under consideration.

1.4. Revenue Recognition

The Company follows the mercantile system of accounting and recognises income and expenditure on accrual basis.

1.5. Employee Benefits

Retirement benefits to the employees have not been provided as no employee is eligible for the same. No Provision has been made in respect of Gratuity Liability. Provident Fund and ESI as no employee is eligible for the same, leave encashment shall be accounted on cash basis.

1.6. Provision For Income Tax

Provision for Current Tax:

Provision for Income Tax is made taking into consideration the Provisions of Income Tax Act, 1961.

Provision for Deferred Taxation:

As per the AS 22, since there is no reasonable certainty that the Company will get profits so as to absorb the carried forward losses and depreciation, the deferred tax asset has not been recognized in the financial statements.

The revised Schedule VI has become effective from 1st April 2011, for the preparation of financial statement. This has significantly impacted the disclosure and presentation made in the financial statements. Previous years figures hav e been regrouped/reclassified wherever necessary to correspond with the current year''s classification/disclosure.

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Mar 31, 2012

1.1. Accounting Convention

The financial statements are prepared under the historical cost convention in accordance with applicable accounting standards and relevant presentational requirements of the Companies Act, 1956.

1.2. Fixed Assets

Fixed Assets are stated at cost and include installation charges, freight, duties, taxes and expenditure incurred during construction period wherever applicable. Assets under erection / commissioning are shown as capital work in progress. All expenditure during the construction period is allocated to Buildings and Plant & Machinery in the same proportion of the balances in the respective heads as on the date of commissioning of the project.

1.3. Depreciation =

Depreciation on the fixed assets is provided on Written Down Value Method at the rates and in the manner prescribed in Schedule - XIV to the Companies Act, 1956 for all the assets during the year under consideration.

1.4. Revenue Recognition

The Company follows the mercantile system of accounting and recognises income and expenditure on accrual basis.

1.5. Employee Benefits

Retirement benefits to the employees have not been provided as no employee is eligible for the same. No Provision has been made in respect of Gratuity Liability. Provident Fund and ESI as no employee is eligible for the same, leave encashment shall be accounted on cash basis.

1.6. Provision For Income Tax

Provision for Current Tax:

Provision for Income Tax is made taking into consideration the Provisions of Income Tax Act, 1961.

Provision for Deferred Taxation:

As per the AS 22, since there is no reasonable certainty that the Company will get profits so as to absorb the carried forward losses and depreciation, the deferred tax asset has not been recognized in the financial statements.

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Mar 31, 2011

1. ACCOUNTING CONVENTION

The financial statements are prepared under historical cost convention and on accrual basis

2. REVENUE RECOGNITION

The Company follows the mercantile system of accounting and recog- nizes income, and expenditure on accrual basis

3. FIXED ASSETS:

Fixed Assets are stated at cost of acquisition. The cost of an asset com- prises of all direct costs relating to acquisition and installation of fixed assets and indirect costs incurred up to putting the same to use.

4. DEPRECIATION:

Depreciation has been provided proportionately on fixed assets at the rates specified in Schedule XIV of the Companies Act, 1956.

5. Accounting Policies not specifically referred to are consistent with the generally Accepted accounting practices and accounting standards un- der section 211 of the Companies Act, 1956.

6. RETIREMENT BENEFITS

Retirement benefits to the employees have not been provided as no employee is eligible for the same. No Provision has been made in respect of Gratuity Liability. Provident Fund and ESI as no employee is eligible for the same, leave encashment shall be accounted on cash basis.

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Mar 31, 2010

1. ACCOUNTING CONVENTION

The financial statements are prepared under historical cost convention and on accrual basis

2. REVENUE RECOGNITION

The Company follows the mercantile system of accounting and recognizes income, and expenditure on accrual basis

3. FIXED ASSETS

Fixed Assets are stated at cost of acquisition including freight, duties and other incidental expenses.

4. DEPRECIATION

Depreciation has been provided proportionately on fixed assets at the rates specified in Schedule XIV of the Companies Act, 1956.

5. Accounting Policies not specifically referred to are consistent with the generally Accepted accounting practices and accounting standards under section 211 of the Companies Act, 1956.

6. RETIREMENT BENEFITS

Retirement benefits to the employees have not been provided as no employee is eligible for the same. No Provision has been made in respect of Gratuity Liability. Provident Fund and ESI as no employee is eligible for the same, leave encashment shall be accounted on cash basis.