Shankara Buildpro Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

Mar 31, 2026

2.2 Material Accounting policies
2.2.1 Revenue recognition

A) Sale of products

Revenue from sale of goods is recognized on of
performance obligation. In other words, revenue is
recognized when a promise in a customer contract

(performance obligation) has been satisfied by
transferring control over the promised goods to the
customer.

Revenue is measured at the transaction price net of
discounts, rebates, returns, taxes and duties as per
the terms of the contract with Customer.

B) Interest income

Interest income from a financial asset is recognized
when it is probable that the economic benefits will
flow to the company and the amount of income can
be measured reliably.

Interest income is accrued on a time basis, by
reference to the principal outstanding and at the
effective interest rate applicable, which is the rate
that exactly discounts estimated future cash
receipts through the expected life of the financial
asset to that asset''s net carrying amount on initial
recognition. Interest income is recognized on time
proportion basis.

C) Other Income

Other income is recognized on accrual basis
provided that it is probable that the economic
benefits will flow to the company and the amount of
income can be measured reliably.

2.2.2 Property, Plant and Equipment

A) Recognition and measurement

The cost of Property, Plant and Equipment
comprises of its purchase price, any import duties
and other taxes (other than those subsequently
recoverable from the tax authorities), any directly
attributable expenditure on making the asset ready
for its intended use, including relevant borrowing
costs for qualifying assets and any expected costs of
decommissioning, net of any trade discounts and
rebates.

B) Subsequent expenditure

Subsequent costs are included in 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 and the cost of the item can be
measured reliably. All other repairs and
maintenance are charged to the Statement of Profit
and Loss during the reporting period in which they
are incurred.

Property, Plant and Equipment are stated in the
balance sheet at cost less accumulated depreciation
/ amortization and impairment, if any.

C) Disposal of Property, Plant and Equipment

An item of Property, Plant and Equipment is
derecognized upon disposal or on retirement, when
no future economic benefits are expected to arise
from the continued use of the asset.

Gains or losses on disposal are determined by
comparing proceeds with the carrying amount.
These are included in the Statement of Profit and
Loss within other gains / (losses).

D) Depreciation

Depreciation commences when the assets are ready
for their intended use. Depreciable amount for
assets is the cost of an asset, or other amount
substituted for cost, less its estimated residual
value. Depreciation is recognized so as to write off
the cost of Property, Plant & Equipment (other than
capital work in progress) less their residual values
over their useful lives, using straight-line method as
per the useful life prescribed in Schedule II to the
Companies Act, 2013.

Details of Property Plant and Equipment and the estimated useful life are as follows

S.no	Asset	Useful life estimated by the Management in Years	Useful life as per Schedule II to the Act in Years
1	Plant and Equipment	15	15
2	Furniture and Fixtures	10	10
3	Vehicles	8-10	8-10
4	Office equipment	5	5
5	Computers	3	3

Management has re-assessed the useful lives of
the Property, Plant and Equipment and on the
basis of technical evaluation, management is of
the view that useful lives assessed by
management, as above, are indicative of the
estimated economic useful lives of the Property,
Plant and Equipment. In respect of additions to
Property, Plant and Equipment, depreciation has
been charged on pro rata basis. Individual assets
costing less than f 0.0005 crore (f 5,000/-) are
depreciated fully during the year of purchase.

The company reviews the residual value, useful
lives and depreciation method annually and, if
current estimates differ from previous estimates,
the change is accounted for as a change in
accounting estimate on a prospective basis.

E) Capital work-in-progress

Capital work-in-progress includes cost of Property,
Plant and Equipment under installation/under
development as at the balance sheet date.
Advances paid towards the acquisition of Property,
Plant and Equipment outstanding at each balance
sheet date are classified as capital advances under
other non-current assets.

2.2.3 Intangible assets

Intangible assets with finite useful lives that are
acquired separately are carried at cost less
accumulated amortization and accumulated
impairment losses. Amortization is recognized in
the income statement on a straight-line basis over
their estimated useful lives of the intangible asset.
Intangible assets that are not available for use are
amortized from the date they are available for use.

The estimated useful lives are as follows:

Software - 3 years

Brand - 3 years

The amortization period and amortization method
for intangible assets are reviewed at the end of
each reporting period, with the effect of any
changes in estimate being accounted for on a
prospective basis.

An item of intangible asset is derecognized upon
disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss
arising on derecognition of the asset is included in
the Statement of Profit or Loss when the asset is
derecognized.

A) Intangible assets under development

An intangible asset is an identifiable
non-monetary asset without physical substance.
The cost of an internally generated intangible
asset comprises all directly attributable costs
necessary to create, produce, and prepare the
asset to be capable of operating in the manner
intended by the Management.

An intangible asset arising from development shall
be recognized if:

i) there is technical feasibility of completing it so
that it will be available for use

ii) the entity intends to complete it and use or
sell it

iii) the entity has ability to use or sell it

iv) technical, financial and other resources are
available to the entity to complete it

v) the entity is able to measure reliably the
expenditure attributable to the intangible
asset during its development.

Intangible assets under development includes
cost of services used and cost of licenses in
generating the intangible asset under
development as at the balance sheet date.

2.2.4 Impairment of Property, Plant and
Equipment and Intangible Assets

At the end of each reporting period, the Board
reviews the carrying amounts of its tangible and
intangible assets to determine whether there is
any indication that those assets have suffered an
impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in
order to determine the extent of the impairment
loss (if any). Where it is not possible to estimate
the recoverable amount of an individual asset, the
company estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
Where a reasonable and consistent basis of
allocation can be identified, corporate assets are
also allocated to individual cash-generating units,
or otherwise they are allocated to the smallest
group of cash-generating units for which a
reasonable and consistent allocation basis can be
identified.

Intangible assets with indefinite useful lives and
intangible assets not yet available for use are

tested for impairment annually, and whenever there
is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less
costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset for
which the estimates of future cash flows have not
been adjusted.

If the recoverable amount of an asset (or
cash-generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset
(or cash-generating unit) is reduced to its
recoverable amount.

An impairment loss is recognized immediately in the
Statement of Profit and Loss, unless the relevant
asset is carried at a revalued amount, in which case
the impairment loss is treated as a revaluation
decrease.

Any reversal of the previously recognized
impairment loss is limited to the extent that the
asset''s carrying amount does not exceed the
carrying amount that would have been determined
if no impairment loss had previously been
recognized.

2.2.5 Leases

Company as a Lessee

At inception of a contract, the Company assesses
whether a contract is, or contains, a lease. A contract
is, or contains, a lease if the contract conveys the
right to control the use of an identified asset for a
period of time in exchange for consideration.

To assess where the Company has the right to
control the use of identified assets, the Company
assesses whether the:

(i) the contract involves the use of identified
assets,

(ii) whether the Company has the right to obtain
substantially all the economic benefits from the
use of assets throughout the period of use and

(iii) whether the Company has the right to direct the
use of assets.

A) Right-of-use

The Company recognizes Right-of-use assets at the

commencement date of the lease i.e. the date the
underlying asset is available for use. Right-of-use
assets are measured at cost less accumulated
depreciation. The cost of Right-of-use assets
includes the amount of lease liabilities recognized,
initial cost incurred and lease payments made at or
before the commencement date. The Right-of-use
asset is depreciated using the straight line method
from the commencement date to the earlier of the
end of the useful life of the Right-of-use asset or the
end of the lease term basis over a lease term. In
addition, the Right-of-use asset is periodically
reduced by impairment losses, if any, and adjusted
for certain remeasurements of the lease liability.

The Right-of-use assets is subsequently measured
at cost less any accumulated depreciation,
accumulated impairment losses, if any and adjusted
for any remeasurement of the lease liability. The
Right-of-use assets is depreciated using the
straight-line method from the commencement date
over the shorter of lease term or useful life of Right
of-use asset. The estimated useful lives of right
of-use assets are determined on the same basis as
those of property, plant and equipment.
Right-of-use assets are tested for impairment
whenever there is any indication that their carrying
amounts may not be recoverable. Impairment loss, if
any, is recognised in the statement of profit and loss.

B) Lease liabilities

At the commencement date of the lease, the
Company recognizes lease liabilities measured at
the present value of lease payments to be made
over the lease term. The lease payments include
fixed payments less any lease incentives receivable,
including amounts expected to be payable by the
Company under residual value guarantee. In
calculating the present value of lease payments, the
Company uses its incremental borrowing rate at the
lease commencement date. The Company
determines its incremental borrowing rate by
obtaining interest rates from various external
financing sources and makes certain adjustments to
reflect the terms of the lease and type of the asset
leased. The lease liability is measured at amortized
cost using the effective interest method. It is
remeasured when there is a change in future lease
payments arising from a change in an index or rate,
if there is a change in the Company''s estimate of the
amount expected to be payable under a residual
value guarantee. When the lease liability is
remeasured in this way, a corresponding adjustment
is made to the carrying amount of the right-of-use
asset or is recorded in Statement of Profit and Loss

if the carrying amount of the right-of-use asset has
been reduced to zero.

C) Short-term leases

The Company has elected not to recognize
right-of-use assets and lease liabilities for
short-term leases that have a lease term of twelve
months or less from the commencement date and
leases of low-value assets. The Company recognizes
the lease payments associated with these leases as
an expense over the lease term.

2.2.6 Inventories

Inventories are stated at lower of cost and net
realizable value.

Cost comprises of purchase price, freight, other
attributable costs, applicable taxes not eligible for
credit, less rebates and discounts, which is
determined on First-in, First-out (''FIFO'') basis.

Net realizable value is the estimated selling price in
the ordinary course of business less the estimated
cost of completion and selling expenses.

All items of inventories which are considered to be
damaged, unmarketable or unserviceable and have
become otherwise obsolete are valued at the
estimated net realizable value.

2.2.7 Employee benefits

In respect of defined contribution plan, the
company makes the stipulated contributions to
provident fund, employees'' state insurance and
pension fund, in respect of employees to the
respective authorities under which the liability of
the company is limited to the extent of the
contribution.

The liability for gratuity, considered as defined
benefit, is determined actuarially using the
projected unit credit method, with actuarial
valuations being carried out at the end of each
annual reporting period.

Re-measurement, comprising actuarial gains and
losses, the effect of the changes to the asset ceiling
(if applicable) and the return on plan assets
(excluding interest), is reflected immediately in the
statement of financial position with a charge or
credit recognized in other comprehensive income in
the period in which they occur. Re-measurement
gains and losses recognized in other comprehensive
income is reflected immediately in retained

earnings and will not be reclassified to profit or loss.
Past service cost is recognized in profit or loss in the
period of a plan amendment. Net interest is
calculated by applying the discount rate at the
beginning of the period to the net defined benefit
liability or asset.

Defined benefit costs are categorized as follows:

- service cost (including current service cost, past
service cost, as well as gains and losses on
curtailments and settlements);

- net interest expense or income; and

- re-measurement.

The company presents the first two components of
defined benefit costs in profit or loss under the head
‘Employee benefits expense''. Curtailment gains and
losses are accounted for as past service costs.

The retirement benefit obligation recognized in the
statement of financial position represents the actual
deficit or surplus in the company''s defined benefit
plans. Any surplus resulting from this calculation is
limited to the present value of any economic
benefits available in the form of refunds from the
plans or reductions in future contributions to the
plans. A liability for a termination benefit is
recognized at the earlier of when the entity can no
longer withdraw the offer of the termination benefit
and when the entity recognizes any related
restructuring costs.

A liability is recognized for benefits accruing to
employees in respect of wages and salaries, annual
leave and sick leave in the period the related service
is rendered at the undiscounted amount of the
benefits expected to be paid in exchange for that
service. Liabilities recognized in respect of
short-term employee benefits are measured at the
undiscounted amount of the benefits expected to
be paid in exchange for the related service.

The company recognizes a liability and an expense
for bonus. The company recognizes a provision
where contractually obligated or where there is a
past practice that has created a constructive
obligation.

2.2.8 Income taxes

Tax expense comprises current and deferred tax. It is
recognized in profit or loss except to the extent that
it relates to a business combination or to an item
recognized directly in equity or in other
comprehensive income.

A) Current tax

Current tax is the amount of tax payable based on
the taxable profit for the year as determined in
accordance with the applicable tax rates and the
provisions of the Indian Income Tax Act, 1961. The
Company''s current tax is calculated using tax rates
that have been enacted or substantively enacted by
the end of the reporting period.

Current tax assets and liabilities are offset only if
there is a legally enforceable right to set off the
recognised amounts and it is intended to settle the
liability on a net basis or simultaneously.

B) Deferred tax

Deferred tax is recognized on temporary differences
between the carrying amounts of assets and
liabilities in the financial statements and the
corresponding tax bases used in the computation of
taxable profit. Deferred tax liabilities are generally
recognized for all taxable temporary differences.

Deferred tax assets are generally recognized for all
deductible temporary differences to the extent that
it is probable that taxable profits will be available
against which those deductible temporary
differences can be utilized.

Such deferred tax assets and liabilities are not
recognized if the temporary difference arises from
the initial recognition (other than in a business
combination) of assets and liabilities in a
transaction that affects neither the taxable profit nor
the accounting profit. In addition, deferred tax
liabilities are not recognized if the temporary
difference arises from the initial recognition of
goodwill.

The carrying amount of deferred tax assets is
reviewed at the end of each annual reporting period
and reduced to the extent that it is no longer
probable that sufficient taxable profits will be
available to allow all or part of the asset to be
recovered.

Deferred tax assets and liabilities are measured at
the tax rates that are expected to apply in the period

in which the liability is settled or the asset is
realized, based on tax rates (and tax laws) that have
been enacted or substantively enacted by the end of
the reporting period.

Deferred tax assets and deferred tax liabilities are
netted against each other if a legally enforceable
right exists to set off current tax assets against
current tax liabilities and the deferred taxes relate
to the same taxable entity and the same taxation
authority.

Current and deferred tax are recognized in the
statement of profit and loss, except when they are
related to items that are recognized in other
comprehensive income or directly in equity, in which
case, the current and deferred tax are also
recognized in other comprehensive income or
directly in equity respectively. Where current tax or
deferred tax arises from the initial accounting for a
business combination, the tax effect is included in
the accounting for the business combination.

The company has exercised option to pay income
tax u/s. 115BAA of the Income Tax Act, 1961. Hence
the provisions relating to minimum alternate tax
(MAT) are not applicable to the company.

2.2.9 Functional currency

The functional currency of the company is
determined on the basis of the primary economic
environment in which it operates. The functional
currency of the company is Indian Rupee (INR).