Jaiprakash Associates Ltd. நிறுவனத்தின் கணக்கியல் கொள்கைகள்
Mar 31, 2023
CORPORATE INFORMATION
Jaiprakash Associates Limited (âthe Companyâ) is a Public Limited Company domiciled in India with its registered office located at Sector-128, Noida-201304 (U.P). The shares of the Company are listed on the National Stock Exchange of India Limited and BSE Limited. The Company is mainly engaged in the business of Engineering & Construction, Manufacturing of Cement, Power, Real Estate development, Hotel/ Hospitality etc. The Company''s financial statements for the financial year ended 31st March, 2023 are approved by the Board of Directors in its meeting held on 27th May, 2023.
SIGNIFICANT ACCOUNTING POLICIES Basis of Preparation of Financial Statements:
The financial statements have been prepared in accordance with the Indian accounting standard (Ind AS), notified under section 133 of the Companies Act 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time. The Company has adopted all the applicable Ind AS. The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all the periods presented in the financial statements. The Company has decided to round off the figures to the nearest lakhs.
Use of estimates and judgments:
The preparation of financial statements requires management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively.
Current and Non-Current Classification
All assets and liabilities have been classified as current or non current as per the Company''s normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non current classification of assets and liabilities except for Real Estate. Operating cycle for Real Estate is ascertained as 5 years. Deferred tax assets and liabilities are classified as non-current assets and liabilities.
Revenue from contracts with customers
Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration) allocated to that performance obligation. The transaction price of goods sold and services rendered is net
of variable consideration on account of various discounts and schemes offered by the Company as part of contract. Transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or service to a customer, excluding amounts collected on behalf of a third party and is adjusted for variable considerations.
Revenue from contracts with customers is recognised when control of the goods or services are 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. The Company has generally concluded that it is the principal in its revenue arrangements, except for the agency services, because it typically controls the goods or services before transferring them to the customer.
Revenue is recognised in the income statement to the extent that it is probable that the economic benefits will flow to the Company and the revenue and costs, if applicable, can be measured reliably.
The Company has applied five step model as per Ind AS 115 âRevenue from Contracts with Customersâ to recognise revenue in the financial statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a) The customer simultaneously receives and consumes the
benefits provided by the Company''s performance as the Company performs; or
b) The Company''s performance creates or enhances an
asset that the customer controls as the asset is created or enhanced; or
c) The Company''s performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at a point in time and over a period of time based on various conditions as included in the contracts with customers.
Revenue from real estate projects
Revenue from sale / sub-lease of undeveloped land is recognized as per agreed terms in each agreement to sell / sub-lease/ term sheet when possession is handed over and all significant risks and rewards are vested in the Customer, provided no significant uncertainty exists regarding the amount of consideration that will be derived from such sales and it is not unreasonable to expect ultimate collection.
Revenue from sale / sub-lease of developed land / plot and FSI rights is recognized based on the âSatisfaction of performance obligation at a point in time methodâ, as per agreed terms in
each agreement to sell / sub lease and offer of possession and all significant risks and rewards are vested in the customerâ, provided where no significant uncertainty exists regarding the amount of consideration that will be derived from such sales and it is not unreasonable to expect ultimate collection.
Revenue from real estate development of constructed properties is recognized on the âSatisfaction of each performance obligation at a point in time method''â that is incumbent, upon providing âOffer of Possession'' or execution of sub lease deed / sale deed to a customer who is vested with all significant risks and rewards, subject to realisation / certainty of realisation.
Revenue from sale of goods - [Cement & Clinker and Others]
Revenue from sale of goods is recognised at a point in time when control of the goods is transferred to the customer, generally on delivery of the goods. In determining the transaction price for the sale of goods, the Company considers the effects of variable consideration and other terms.
Revenue from construction and other contracts
The Company recognises revenue from construction contracts over time, using an input method to measure progress towards complete satisfaction of the service, because the customer simultaneously receives and consumes the benefits provided by the Company. The estimated project cost includes construction cost, construction material cost, labour cost & other direct relatable cost, borrowing cost and overheads of such project. The estimates of the contract price and costs are reviewed periodically and effect of any changes in such estimates is recognised in the period such changes are determined. However, when the total project cost is estimated to exceed total revenues from the project, the loss is recognised immediately. Transaction price is the amount of consideration to which the Company expects to be entitled in exchange for service to a customer excluding amounts collected on behalf of a third party and is adjusted for variable considerations.
Revenue from Power supply
Revenue from Power supply is recognised in terms of power purchase agreements entered into with the respective purchasers.
Revenue from Hotel & Hospitality Operation
Revenue from Hotel operation and related services is recognised net of discounts and sales related taxes in the period in which the services are rendered. Advances received for time share weeks are reckoned as income in equal amounts spread over the time share period commencing from the year in which full payment is received.
Revenue from Other services - [Manpower services, Fabrication jobs and Sports Events]
Income from other services is recognised as per the management agreement with the parties, as and when Company satisfies performance obligation by delivering the promised goods or services as per contractual agreed terms.
Interest Income:
Interest income is recognized using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash flows over the expected life of financial instrument, to the gross carrying amount of the financial assets or to the amortized cost of the financial liability.
Dividend income from investments is recognised when the Company''s right to receive the payment is established, which is generally when shareholders approve the dividend provided that it is probable that the economic benefit will flow to the Company.
Royalties:
Royalties are accounted on an accrual basis in accordance with the substance of the relevant agreement.
Any other items of income other than interest, dividend or royalties are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.
Contract balances Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional.
A receivable represents the Company''s right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due). Refer to accounting policies of financial assets in Financial instruments - initial recognition and subsequent measurement.
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Company performs under the contract.
Cost Recognition:
Revenue Costs and expenses except real estate expenses are recognized in statement of profit and loss when incurred and are classified according to their nature. Real estate expenses are recognised in consonance with the recognition of real
estate revenue.
Property, plant and equipment:
Property, plant and equipment are stated at cost [i.e. cost of acquisition or construction inclusive of freight, erection and commissioning charges, non-refundable duties and taxes, expenditure during construction period, other directly attributable costs, borrowing costs (in case of a qualifying asset) up to the date of acquisition/ installation], net of accumulated depreciation and accumulated impairment losses, if any.
Property, plant and equipment which are not ready for intended use as on the date of Balance Sheet are disclosed as âCapital work-in-progressâ and are carried at cost comprising direct costs, related incidental expenses, other directly attributable costs and borrowing costs (in case of a qualifying asset).
Subsequent costs are included in the asset''s carrying amount or recognised 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. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset when the recognition criteria for a provision are met.
Depreciation and amortisation
Depreciation on property, plant and equipment is provided over the useful life of assets as specified in schedule II of the Act. Property, plant and equipment which are added / disposed off during the year, deprecation is provided prorata basis with reference to the month of addition / deletion.
Depreciation is calculated on straight line basis over the estimated useful lives of the assets as follows
|
Sl. No. |
Nature |
Useful Life [In Years] |
|
1 |
Building |
5 to 60 |
|
2 |
Purely Temporary Erection |
1 to 3 |
|
3 |
Plant & Equipments |
3 to 40 |
|
4. |
Miscellaneous Fixed Assets [Hotel] |
10 to 15 |
|
5 |
Vehicles |
4 to 10 |
|
6 |
Furniture & Fixture |
8 to 15 |
|
7 |
Office Equipments |
3 to 10 |
|
8 |
Aeroplane/Helicopter |
20 |
However, certain class of temporary buildings used in construction projects are depreciated over the lives of project based on technical evaluation and the management''s
experience of use of the assets as against the period as prescribed in Schedule II of Companies Act, 2013.
Freehold land is not depreciated.
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
Assets acquired on lease and leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter.
An item of property, plant and equipment and any significant part initially recognised is derecognised 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 recognised in profit or loss when the asset is derecognised.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the Company expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is provided over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
The Company has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.
Intangible assets:
Intangible assets acquired separately are measured on initial recognition at cost which comprises purchase price (including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates) and any directly attributable cost of preparing the asset for its intended use. An intangible assets acquired in a business combination is recognised at fair value at the date of acquisition. After initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangible assets, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. Amortisation is recognised on a straight line basis over their estimated useful life. 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 being accounted for on a prospective basis. 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.
Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset is derecognised.
Computer Software is amortized over a period of 5 years. Government Grants:
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the company with no future related costs are recognised in statement of profit or loss in the period in which they become receivable. Grants related to depreciable assets are usually recognised in profit or loss over the periods and in the proportions in which depreciation expense on those assets is recognised. Grants related to non-depreciable assets may also require the fulfilment of certain obligations and would then be recognised in profit or loss over the periods that bear to the cost of meeting the obligations.
When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset. When loans or similar assistance or deferred liability are provided by governments, with nil interest rate or rate below the current applicable market rate, the effect of this favourable interest is regarded as a government grant. The loan or assistance is initially recognised and measured at fair value and the government grant is measured as the difference
between the initial carrying value of the loan and the proceeds received. The loan is subsequently measured as per the accounting policy applicable to financial liabilities.
Foreign Currencies:
Functional Currency
The Company''s financial statements are presented in INR, which is also its functional currency.
Transactions in foreign currencies are initially recorded by the Company at functional currency spot rates at the date the transaction first qualifies for recognition. However, for practical reasons, the Company uses an average rate if the average approximates the actual rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit and Loss. They are deferred in equity if they are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit or loss, within finance costs. All other foreign exchange gains and losses are presented in the statement of profit or loss on a net basis within Foreign Currency Rate Difference [Net] - Other than financing.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss.
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. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in Other Comprehensive Income [OCI] or profit or loss are also recognised in OCI or profit or loss, respectively).
In case of an asset, expense or income where a non-monetary advance is paid/received, the date of transaction is the date on which the advance was initially recognised. If there were multiple payments or receipts in advance, multiple dates of transactions are determined for each payment or receipt of advance consideration.
Inventories:Inventories are measured as under:
i Raw materials, construction materials, stores and spares, packing materials, stock of food and beverages, operating stores and supplies are measured at lower of cost or net realisable value. 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. Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition.
ii Finished goods, Stock in Process, Cost of Construction, Projects Under Development are measured at lower of cost or net realisable value. Cost includes cost of raw materials, cost of conversion, borrowing costs of qualifying asset and other costs incurred in bringing the inventories to their present location and condition. Cost of finished goods and stock in process is determined on weighted average basis .
iii Traded goods are measured at lower of cost or net realisable value. Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
Borrowing Costs:
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset, 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 the asset. The borrowing cost cease to capitalise when the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes finance charges in respect of finance lease and exchange differences arising from foreign currency borrowing to the extent regarded as an adjustment to the interest costs.
Employee benefits:
The undiscounted amount of short-term employee benefits i.e. wages and salaries, bonus, incentive, annual leave and sick leave etc. expected to be paid in exchange for the service rendered by employees are recognized as an expense except in so far as employment costs may be included within the cost of an asset during the period when the employee renders the services.
Retirement benefit in the form of provident fund and pension contribution is a defined contribution scheme and is recognized as an expense except in so far as employment costs may be included within the cost of an asset.
Gratuity and leave encashment is a defined benefit obligation. The liability is provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation
is done as per Projected Unit Credit method.
Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to profit or loss through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.
Company as lessee:
The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company''s incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. Lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability and reducing the carrying amount to reflect the lease payments made. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down.
Company as lessor:
Amounts due from lessee under finance leases are recorded as receivables at the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.
Rental income from operating lease is recognised on a straightline basis over the term of the relevant lease unless either:
[i] another systematic basis is more representative of the time pattern in which benefit derived from the use of the leased asset is diminished, even if the payments to the lessors are not on that basis; or
[ii] the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases. If payments to the lessor vary according to factors other than inflation, then this condition is not met.
Research and development costs
Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate:
[i] The technical feasibility of completing the intangible asset so that the asset will be available for use or sale
[ii] Its intention to complete and its ability and intention to use or sell the asset
[iii] How the asset will generate future economic benefits
[iv] The availability of resources to complete the asset
[v] The ability to measure reliably the expenditure during development
Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over the period of expected future benefit. Amortisation expense is recognised in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.
During the period of development, the asset is tested for impairment annually.
Impairment of non-financial assets:
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
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. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.
Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of profit and loss, except for properties previously revalued with the revaluation surplus taken to OCI. For such properties, the impairment is recognised in OCI up to the amount of any previous revaluation surplus.
For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist
or have decreased. If such indication exists, the Company estimates the asset''s or CGU''s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation change.
Goodwill is tested for impairment as at each Balance Sheet date and when circumstances indicate that the carrying value may be impaired.
Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.
Intangible assets with indefinite useful lives are tested for impairment annually as at each Balance sheet date at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.
Provisions
General:
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. When the Company expects some or all of a provision to be reimbursed (like under an insurance contract, indemnity clauses or suppliers'' warranties) and the Company is solely liable to pay the liability, the reimbursement is recognised as a separate asset. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement if the Company is not solely liable to pay the liability. The reimbursement of provision is only recognized when it is virtually certain that the company will receive the reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Restructuring Provisions:
Restructuring provisions are recognised only when the Company has a constructive obligation, which is when a detailed formal plan identifies the business or part of the
business concerned, the location and number of employees affected, a detailed estimate of the associated costs, and an appropriate timeline, and the employees affected have been notified of the plan''s main features.
A warranty provision is recognised for the best estimate of the expenditure that will be required to settle the company obligation of relevant goods.
Decommissioning Liability:
The Company records a provision for decommissioning costs with respect to manufacturing units/ project sites etc. Decommissioning costs are provided at the present value of expected costs to settle the obligation using estimated cash flows and are recognised as part of the cost. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognised in the statement of profit and loss as a finance cost. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.
The Company does recognise and measure as a provision the present obligation under an onerous contract, an onerous contract being a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it.
Contingent Liabilities/ Contingent Assets:
Contingent Liabilities are not recognized but are disclosed in the notes unless the possibility of an outflow of resources embodying economic benefits is remote. Contingent assets are disclosed in the financial statements only when the inflow of economic benefits is probable. Contingent liability and Contingent assets are reviewed at each reporting date.
Tax expense represents the sum of the current income tax and deferred tax.
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted in India, at the reporting date. Interest expenses and penalties, if any, related to income tax are included in finance cost and other expenses respectively. Interest Income, if any, related to income tax is included in other income.
The Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Current tax assets and current tax liabilities are offset where the Company has a legally enforceable right to offset the
recognised amount and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Deferred tax:
Deferred tax is recognized on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.
A deferred tax liability is recognised based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted, or substantively enacted, by the end of the reporting period. Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses 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 to allow all or part of the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Current tax and deferred tax are recognised in statement of profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity respectively.
Deferred tax assets and deferred tax liabilities are offset when the Company has legally enforceable right to offset current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.
Non-current assets held for sale/ distribution to owners and discontinued operations
The Company classifies non-current assets (or disposal groups) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Held for sale is classified only if the asset (or disposal group) is available for immediate sale in its present condition subject only to the terms that are usual and customary for sale for such assets (or disposal group) and its sale is highly probable i.e. Management is committed to sale, which is expected to be completed within one year from date of classification.
Sale transactions include exchanges of non-current assets for other non-current assets when the exchange has commercial substance. Non-current assets (or disposal group) that is to be abandoned are not classified as held for sale.
Non-current assets held for sale and disposal groups are measured at the lower of their carrying amount and the fair value less costs to sell. Assets and liabilities classified as held for sale are presented separately in the balance sheet.
Non-current assets held for sale are not depreciated or amortised. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale are continue to be recognised.
Non-current asset (or disposal group) is reclassified from held to sale if the criteria are no longer met and measured at lower of:
[i] Its carrying amount before the asset (or Disposal group) was classified as held for sale, adjusted for any depreciation, amortisation or revaluations that would have been recognised had the asset (or disposal group) not been classified as held for sale, and
[ii] Its recoverable amount at the date of the subsequent decision not to sell.
Any adjustment to the carrying amount of a non-current asset that ceases to be classified as held for sale is charged to profit or loss from continuing operations in the period in which criteria are no longer met.
A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed off, or is classified as held for sale, and:
[i] Represents a separate major line of business or geographical area of operations
[ii] Is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations, or
[iii] Is a subsidiary acquired exclusively with a view to resale. Fair value measurement
The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.
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. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
[i] In the principal market for the asset or liability, or
[ii] In the absence of a principal market, in the most advantageous market accessible by the Company for the asset or liability.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
[i] Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities
[ii] Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
[iii] Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing 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.
The Company determines the policies and procedures for both recurring fair value measurement, such as derivative instruments and unquoted financial assets measured at fair value, and for non-recurring measurement, such as assets held for distribution in discontinued operations. External valuers are involved for valuation of significant assets, such as properties and unquoted financial assets, and significant liabilities, such as contingent consideration. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. At each reporting date, the Company analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Company''s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
The Company, in conjunction with the Company''s external valuers, also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
Convertible Preference Shares/ Bonds [Liability]
Convertible Preference Shares/ Bonds are separated into liability and equity components based on the terms of the contract.
On issuance of the convertible Preference Shares/ Bonds, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument. This amount is classified as a financial liability measured at amortised cost (net of transaction costs) until it is extinguished on conversion or redemption.
The remainder of the proceeds is allocated to the conversion option that is recognised as equity. Transaction costs are deducted from equity, net of associated income tax. The carrying amount of the conversion option is not remeasured in subsequent years.
Transaction costs are apportioned between the liability and equity components of the Preference Shares/ Bonds based on the allocation of proceeds to the liability and equity components when the instruments are initially recognised.
Earnings per share
Basic earnings per equity share is computed by dividing net profit after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing adjusted net profit after tax by the aggregate of weighted average number of equity shares and dilutive potential equity shares during the year.
Financial assets and liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Cash and Cash Equivalents
Cash and cash equivalent in the balance sheet comprise unrestricted cash at banks and on hand and unrestricted short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of unrestricted cash and short-term deposits.
Initial Recognition & measurements
Financial instruments are initially measured at fair value including transaction costs unless they are classified at fair value through profit and loss, in which case the transaction costs are expensed immediately. However, trade receivables that do not contain a significant financing component are initially measured at transaction price. Subsequent to initial recognition, these instruments are measured in accordance with their classification as set out below.
Subsequent measurement
Measurement of financial assets is done as below:
[i] Amortised cost, if the financial asset is held within a business model whose object is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specific dates to cash flows that are solely payments of principal and interest on the principal amount outstanding,
[ii] Fair value through profit or loss (FVTPL)
Investment in Subsidiaries, Associates and Joint Ventures
The Company has accounted for its investments in equity shares and compulsory convertible preference shares of subsidiaries, associates and joint venture at cost less
accumulated impairment losses, if any. On disposal of investments in subsidiaries, associates and joint venture, the difference between net disposal proceeds and the carrying amounts are recognised in the Statement of profit and loss.
Other Equity Investments
All equity investments [other than investment in Subsidiaries, Associates and Joint Ventures] are measured at fair value, with value changes recognised in Statement of Profit and Loss.
De-recognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily de-recognised when:
[i] The rights to receive cash flows from the asset have expired, or
[ii] The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
On derecognising of a financial asset in its entirety, the difference between the asset''s carrying amount and the sum of the consideration received or receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss.
Impairment of financial assets
In accordance with IND AS 109, the Company applies Expected Credit Loss (ECL) Model for measurement & recognition of impairment loss on the following financial assets & credit risk exposure.
[i] Financial assets that are debt instruments, and are measured at amortised cost, e.g. loans, debt securities, deposits, trade receivables and bank balance
[ii] Financial assets that are debt instruments and are measured as at FVTPL.
[iii] Lease receivables under Ind AS 17.
[iv] Trade receivables
[v] Contract assets
[vi] Loan commitments which are not measured as at FVTPL.
[vii] Financial guarantee contracts which are not measured as at FVTPL.
The Company follows âsimplified approach'' for recognition of impairment loss allowance on:
[i] Trade receivables including contract assets; and
[ii] All lease receivables resulting from transactions within the scope of Ind AS 17
The application of simplified approach does not require the
Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.
ECL impairment loss allowance (or reversal) is recognized during the period as income / expense in the statement of profit and loss.
Financial assets measured as at amortised cost, contractual revenue receivables and lease receivables: ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying amount.
For assessing increase in credit risk and impairment loss, the Company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis.
Initial recognition & measurement
All Financial liabilities are recognised initially at fair value and in case of loan & borrowings and payable, net-off directly attributable transaction cost.
The Company''s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments
Gains or losses on liabilities held for trading are recognised in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the Effective Interest Rate [EIR] method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an
Mar 31, 2021
CORPORATE INFORMATION
Jaiprakash Associates Limited is a Public Limited Company domiciled in India with its registered office located at Sector-128, Noida-201304 (U.P). The shares of the Company are listed on the National Stock Exchange of India Limited and BSE Limited. The Company is mainly engaged in the business of Engineering & Construction, Manufacturing of Cement, Power, Real Estate development, Hotel/ Hospitality, Sports etc. The Company''s financial statements for the financial year ended 31st March, 2021 are approved by the Board of Directors in its meeting held on 21st June, 2021.
SIGNIFICANT ACCOUNTING POLICIES Basis of Preparation of Financial Statements:
The financial statements have been prepared in accordance with the Indian accounting standard (Ind AS), notified under section 133 of the Companies Act 2013, and the relevant provisions of the Companies Act, 2013. The Company has adopted all the applicable Ind AS. The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all the periods presented in the financial statements.
Use of estimates and judgements:
The preparation of financial statements requires management to make judgements, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgements based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively.
Current and Non-Current Classification
All assets and liabilities have been classified as current or non current as per the Company''s normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non current classification of assets and liabilities except for Real Estate. Operating cycle for Real Estate is ascertained as 5 years.
Revenue from contracts with customers
Revenue is measured based on the consideration to which the Company expects to be entitled in a contract with a customer and excludes amounts collected on behalf of third parties. Revenue from contracts with customers is recognised when control of the goods or services are 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. The Company has generally concluded that it is the principal in its revenue arrangements, except for the agency services, because it typically controls the goods or services before transferring them to the customer.
Revenue is recognised in the income statement to the extent that it is probable that the economic benefits will flow to the Company and the revenue and costs, if applicable, can be measured reliably.
The Company has applied five step model as per Ind AS 115 âRevenue from Contracts with Customersâ to recognise revenue in the financial statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a) The customer simultaneously receives and consumes the benefits provided by the Company''s performance as the Company performs; or
b) The Company''s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
c) The Company''s performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at a point in time and over a period of time based on various conditions as included in the contracts with customers.
Revenue from real estate projects
Revenue from sale / sub-lease of undeveloped land is recognized as per agreed terms in each agreement to sell / sub-lease/ term sheet when possession is handed over and all significant risks and rewards are vested in the Customer, provided no significant uncertainty exists regarding the amount of consideration that will be derived from such sales and it is not unreasonable to expect ultimate collection.
Revenue from sale / sub-lease of developed land / plot and FSI rights is recognized based on the âSatisfaction of performance obligation at a point in time methodâ, as per agreed terms in each agreement to sell / sub lease and offer of possession and all significant risks and rewards are vested in the customerâ, provided where no significant uncertainty exists regarding the amount of consideration that will be derived from such sales and it is not unreasonable to expect ultimate collection.
âRevenue from real estate development of constructed properties is recognized on the âSatisfaction of each performance obligation at a point in time method''â that is incumbent, upon providing âOffer of Possession'' or execution of sub lease deed / sale deed to a customer who is vested with all significant risks and rewards, subject to realisation / certainty of realisation.
Revenue from sale of goods - [Cement & Clinker and Others]
Revenue from sale of goods is recognised at a point in time when control of the goods is transferred to the customer, generally on delivery of the goods. In determining the transaction price for the sale of goods, the Company considers the effects of variable consideration and other terms.
Revenue from construction and other contracts The Company recognises revenue from construction contracts over time, using an input method to measure progress towards complete satisfaction of the service, because the customer simultaneously receives and consumes the benefits provided by the Company. The estimated project cost includes construction cost, construction material cost, labour cost & other direct relatable cost, borrowing cost and overheads of such project. The estimates of the contract price and costs are reviewed periodically and effect of any changes in such estimates is recognised in the period such changes are determined. However, when the total project cost is estimated to exceed total revenues from the project, the loss is recognised immediately. Transaction price is the amount of consideration to which the Company expects to be entitled in exchange for service to a customer excluding amounts collected on behalf of a third party and is adjusted for variable considerations. Revenue from Power supply
Revenue from Power supply is recognised in terms of power purchase agreements entered into with the respective purchasers.
Revenue from Hotel & Hospitality Operation
Revenue from Hotel operation and related services is recognised net of discounts and sales related taxes in the period in which the services are rendered. Advances received for time share weeks are reckoned as income in equal amounts spread over the time share period commencing from the year in which full payment is received.
Revenue from Other services - [Manpower services, Fabrication jobs and Sports Events]
Income from other services is recognised as per the management agreement with the parties, as and when Company satisfies performance obligation by delivering the promised goods or services as per contractual agreed terms. Other Income:
Interest income is recognized using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash flows over the expected life of financial instrument, to the gross carrying amount of the financial assets or to the amortized cost of the financial liability.
Dividend income from investments is recognised when the Company''s right to receive the payment is established, which is generally when shareholders approve the dividend provided that it is probable that the economic benefit will flow to the Company.
Royalties:
Royalties are accounted on an accrual basis in accordance with the substance of the relevant agreement.
Any other items of income other than interest, dividend or royalties are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.
Contract balances Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional.
A receivable represents the Company''s right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due). Refer to accounting policies of financial assets in Financial instruments - initial recognition and subsequent measurement. Contract liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Company performs under the contract.
Cost Recognition:
Revenue Costs and expenses except real estate expenses are recognized in statement of profit and loss when incurred and are classified according to their nature. Real estate expenses are recognised in consonance with the recognition of real estate revenue.
Property, plant and equipment:
Property, plant and equipment are stated at cost [i.e. cost of acquisition or construction inclusive of freight, erection and commissioning charges, non-refundable duties and taxes, expenditure during construction period, borrowing costs (in case of a qualifying asset) up to the date of acquisition/ installation], net of accumulated depreciation and accumulated impairment losses, if any.
Capital work in progress, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other
However, certain class of temporary buildings used in construction projects are depreciated over the lives of project based on technical evaluation and the management''s experience of use of the assets as against the period as prescribed in Schedule II of Companies Act, 2013.
Freehold land is not depreciated.
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter.
An item of property, plant and equipment and any significant part initially recognised is derecognised 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 recognised in profit or loss when the asset is derecognised.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
repair and maintenance costs are recognised in profit or loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset when the recognition criteria for a provision are met.
Depreciation and amortisation
Depreciation on property, plant and equipment is provided over the useful life of assets as specified in schedule II of the Act. Property, plant and equipment which are added / disposed off during the year, deprecation is provided prorata basis with reference to the month of addition / deletion.
Depreciation is calculated on straight line basis over the estimated useful lives of the assets as follows:
|
Sl. No. |
Nature |
Useful Life [In Years] |
|
1 |
Building |
5 to 60 |
|
2 |
Purely Temporary Erection |
1 to 3 |
|
3 |
Plant & Equipments |
3 to 40 |
|
4. |
Miscellaneous Fixed Assets [Hotel] |
10 to 15 |
|
5 |
Vehicles |
4 to 10 |
|
6 |
Furniture & Fixture |
8 to 15 |
|
7 |
Office Equipments |
3 to 10 |
|
8 |
Aeroplane/Helicopter |
20 |
life of the asset, whichever is the shorter. Where the Company expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is provided over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
The Company has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.
Intangible assets:
Intangible assets acquired separately are measured on initial recognition at cost which comprises purchase price (including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates) and any directly attributable cost of preparing the asset for its intended use. An intangible assets acquired in a business combination is recognised at fair value at the date of acquisition. After initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangible assets, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. Amortisation is recognised on a straight line basis over their estimated useful life. 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 being accounted for on a prospective basis. 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.
Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset is derecognised.
Computer Software is amortized over a period of 5 years.
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the company with no future related costs are recognised in statement of profit or loss in the period in which they become receivable. Grants related to depreciable assets are usually recognised in profit or loss over the periods and in the proportions in which depreciation expense on those assets is recognised. Grants related to non-depreciable assets may also require the fulfilment of certain obligations and would then be recognised in profit or loss over the periods that bear to the cost of meeting the obligations.
When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset. When loans or similar assistance or deferred liability are provided by governments, with nil interest rate or rate below the current applicable market rate, the effect of this favourable interest is regarded as a government grant. The loan or assistance is initially recognised and measured at fair value and the government grant is measured as the difference between the initial carrying value of the loan and the proceeds received. The loan is subsequently measured as per the accounting policy applicable to financial liabilities.
Foreign Currencies:
Functional Currency
The Company''s financial statements are presented in INR, which is also its functional currency.
Transactions in foreign currencies are initially recorded by the Company at functional currency spot rates at the date the transaction first qualifies for recognition. However, for practical reasons, the Company uses an average rate if the average approximates the actual rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit and Loss. They are deferred in equity if they are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit or loss, within finance costs. All other foreign exchange gains and losses are presented in the statement of profit or loss on a net basis within Foreign Currency Rate Difference [Net] - Other than financing.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rates at the dates of the initial transactions. Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss.
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. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in Other Comprehensive Income [OCI] or profit or loss are also recognised in OCI or profit or loss, respectively).
In case of an asset, expense or income where a non-monetary advance is paid/received, the date of transaction is the date on which the advance was initially recognised. If there were multiple payments or receipts in advance, multiple dates of transactions are determined for each payment or receipt of advance consideration.
Inventories:
Inventories are measured as under:
i Raw materials, construction materials, stores and spares, packing materials, stock of food and beverages, operating stores and supplies are measured at lower of cost or net realisable value. 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. Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition.
ii Finished goods, Stock in Process, Cost of Construction, Projects Under Development are measured at lower of cost or net realisable value. Cost includes cost of raw materials, cost of conversion, borrowing costs of qualifying asset and other costs incurred in bringing the inventories to their present location and condition. Cost of finished goods and stock in process is determined on weighted average basis.
iii Traded goods are measured at lower of cost or net realisable value. Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
Borrowing Costs:
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset, 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 the asset. The borrowing cost cease to capitalise when the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes finance charges in respect of finance lease and exchange differences arising from foreign currency borrowing to the extent regarded as an adjustment to the interest costs.
Employee benefits:
The undiscounted amount of short-term employee benefits i.e. wages and salaries, bonus, incentive, annual leave and sick leave etc. expected to be paid in exchange for the service rendered by employees are recognized as an expense except in so far as employment costs may be included within the cost of an asset during the period when the employee renders the services.
Retirement benefit in the form of provident fund and pension contribution is a defined contribution scheme and is recognized as an expense except in so far as employment costs may be included within the cost of an asset.
Gratuity and leave encashment is a defined benefit obligation. The liability is provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is done as per Projected Unit Credit method.
Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to profit or loss through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.
Company as lessee:
The Company has changed its accounting policy for leases where the Company is the lessee. As per new policy, a lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company''s incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used;
residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down.
Company as lessor:
Amounts due from lessee under finance leases are recorded as receivables at the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.
Rental income from operating lease is recognised on a straightline basis over the term of the relevant lease unless either:
[i] another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished, even if the payments to the lessors are not on that basis; or
[ii] the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases. If payments to the lessor vary according to factors other than inflation, then this condition is not met.
Research and development costs
Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate:
[i] The technical feasibility of completing the intangible asset so that the asset will be available for use or sale
[ii] Its intention to complete and its ability and intention to use or sell the asset
[iii] How the asset will generate future economic benefits
[iv] The availability of resources to complete the asset
[v] The ability to measure reliably the expenditure during development
Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over the period of expected future benefit. Amortisation expense is recognised in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.
During the period of development, the asset is tested for impairment annually.
Impairment of non-financial assets:
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is
determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
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. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.
Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of profit and loss, except for properties previously revalued with the revaluation surplus taken to OCI. For such properties, the impairment is recognised in OCI up to the amount of any previous revaluation surplus.
For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset''s or CGU''s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation change.
Goodwill is tested for impairment as at each Balance Sheet date and when circumstances indicate that the carrying value may be impaired.
Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.
Intangible assets with indefinite useful lives are tested for impairment annually as at each Balance sheet date at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.
General:
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate.
When the Company expects some or all of a provision to be reimbursed (like under an insurance contract, indemnity clauses or suppliers'' warranties) and the Company is solely liable to pay the liability, the reimbursement is recognised as a separate asset. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement if the Company is not solely liable to pay the liability. The reimbursement of provision is only recognized when it is virtually certain that the company will receive the reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Restructuring Provisions:
Restructuring provisions are recognised only when the Company has a constructive obligation, which is when a detailed formal plan identifies the business or part of the business concerned, the location and number of employees affected, a detailed estimate of the associated costs, and an appropriate timeline, and the employees affected have been notified of the plan''s main features.
A warranty provision is recognised for the best estimate of the expenditure that will be required to settle the company obligation of relevant goods.
Decommissioning Liability:
The Company records a provision for decommissioning costs with respect to manufacturing units/ project sites etc. Decommissioning costs are provided at the present value of expected costs to settle the obligation using estimated cash flows and are recognised as part of the cost. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognised in the statement of profit and loss as a finance cost. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.
The Company does recognise and measure as a provision the present obligation under an onerous contract, an onerous contract being a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. Contingent Liabilities/ Contingent Assets:
Contingent Liabilities are not recognized but are disclosed in the notes unless the possibility of an outflow of resources
embodying economic benefits is remote. Contingent assets are disclosed in the financial statements only when the inflow of economic benefits is probable. Contingent liability and Contingent assets are reviewed at each reporting date.
Tax expense represents the sum of the current income tax and deferred tax.
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted in India, at the reporting date.
Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax is recognized on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses 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 to allow all or part of the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Current and deferred tax are recognised in profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity respectively.
Non-current assets held for sale/ distribution to owners and discontinued operations
The Company classifies non-current assets (or disposal groups) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Held for sale is classified only if the asset (or disposal group) is available for immediate sale in its present condition subject only to the terms that are usual and customary for sale for such assets (or disposal group) and its sale is highly probable i.e. Management is committed to sale, which is expected to be completed within one year from date of classification.
Sale transactions include exchanges of non-current assets for other non-current assets when the exchange has commercial
substance. Non-current assets (or disposal group) that is to be abandoned are not classified as held for sale
Non-current assets held for sale and disposal groups are measured at the lower of their carrying amount and the fair value less costs to sell. Assets and liabilities classified as held for sale are presented separately in the balance sheet.
Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale are continue to be recognised.
Non-current asset (or disposal group) is reclassified from held to sale if the criteria are no longer met and measured at lower of:
[i] Its carrying amount before the asset (or Disposal group) was classified as held for sale, adjusted for any depreciation, amortisation or revaluations that would have been recognised had the asset (or disposal group) not been classified as held for sale, and
[ii] Its recoverable amount at the date of the subsequent decision not to sell.
Any adjustment to the carrying amount of a non-current asset that ceases to be classified as held for sale is charged to profit or loss from continuing operations in the period in which criteria are no longer met.
A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed off, or is classified as held for sale, and:
[i] Represents a separate major line of business or geographical area of operations
[ii] Is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations, or
[iii] is a subsidiary acquired exclusively with a view to resale. Fair value measurement
The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.
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. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
[i] In the principal market for the asset or liability, or
[ii] In the absence of a principal market, in the most advantageous market accessible by the Company for the asset or liability.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
[i] Level 1 - Quoted (unadjusted) market prices in active
markets for identical assets or liabilities
[ii] Level 2 - Valuation techniques for which the lowest
level input that is significant to the fair value measurement is directly or indirectly observable
[iii] Level 3 - Valuation techniques for which the lowest
level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing 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.
The Company determines the policies and procedures for both recurring fair value measurement, such as derivative instruments and unquoted financial assets measured at fair value, and for non-recurring measurement, such as assets held for distribution in discontinued operations. External valuers are involved for valuation of significant assets, such as properties and unquoted financial assets, and significant liabilities, such as contingent consideration. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. At each reporting date, the Company analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Company''s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
The Company, in conjunction with the Company''s external valuers, also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
Convertible Preference Shares/ Bonds [Liability]
Convertible Preference Shares/ Bonds are separated into liability and equity components based on the terms of the contract.
On issuance of the convertible Preference Shares/ Bonds, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument.
This amount is classified as a financial liability measured at amortised cost (net of transaction costs) until it is extinguished on conversion or redemption.
The remainder of the proceeds is allocated to the conversion option that is recognised as equity. Transaction costs are deducted from equity, net of associated income tax. The carrying amount of the conversion option is not remeasured in subsequent years.
Transaction costs are apportioned between the liability and equity components of the Preference Shares/ Bonds based on the allocation of proceeds to the liability and equity components when the instruments are initially recognised.
Basic earnings per equity share is computed by dividing net profit after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing adjusted net profit after tax by the aggregate of weighted average number of equity shares and dilutive potential equity shares during the year.
Financial assets and liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Cash and cash equivalent in the balance sheet comprise unrestricted cash at banks and on hand and unrestricted short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of unrestricted cash and short-term deposits.
Initial Recognition & measurements
Financial instruments are initially measured at fair value including transaction costs unless they are classified at fair value through profit and loss, in which case the transaction costs are expensed immediately. Subsequent to initial recognition, these instruments are measured in accordance with their classification as set out below.
Subsequent measurement
Measurement of financial assets is done as below:
[i] Amortised cost, if the financial asset is held within a business model whose object is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specific dates to cash flows that are solely payments of principal and interest on the principal amount outstanding,
[ii] Fair value through profit or loss (FVTPL)
Investment in Subsidiaries, Associates and Joint Ventures
The Company has accounted for its investments in equity
For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.
ECL impairment loss allowance (or reversal) recognized during the period as income / expense in the statement of profit and loss.
Financial assets measured as at amortised cost, contractual revenue receivables and lease receivables: ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying amount.
For assessing increase in credit risk and impairment loss, the Company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis.
Financial liabilities
Initial recognition & measurement
All Financial liabilities are recognised initially at fair value and in case of loan & borrowings and payable, net-off directly attributable transaction cost.
The Company''s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments
Gains or losses on liabilities held for trading are recognised in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial
shares and compulsory convertible preference shares of subsidiaries, associates and joint venture at cost.
Other Equity Investments
All equity investments [other than investment in Subsidiaries, Associates and Joint Ventures] are measured at fair value, with value changes recognised in Statement of Profit and Loss.
De-recognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily de-recognised when:
[i] The rights to receive cash flows from the asset have expired, or
[ii] The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
On derecognising of a financial asset in its entirety, the difference between the asset''s carrying amount and the sum of the consideration received or receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss.
Impairment of financial assets
In accordance with IND AS 109, the Company applies Expected Credit Loss (ECL) Model for measurement & recognition of impairment loss on the following financial assets & credit risk exposure.
[i] Financial assets that are debt instruments, and are measured at amortised cost, e.g. loans, debt securities, deposits, trade receivables and bank balance
[ii] Financial assets that are debt instruments and are measured as at FVTPL.
[iii] Lease receivables under Ind AS 17.
[iv] Trade receivables
[v] Contract assets
[vi] Loan commitments which are not measured as at FVTPL.
[vii] Financial guarantee contracts which are not measured as at FVTPL.
The Company follows âsimplified approach'' for recognition of impairment loss allowance on:
[i] Trade receivables including contract assets; and
[ii] All lease receivables resulting from transactions within the scope of Ind AS 17
The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the Effective Interest Rate [EIR] method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.
An embedded derivative is a component of a hybrid (combined) instrument that also includes a non-derivative host contract -with the effect that some of the cash flows of the combined instrument vary in a way similar to a stand-alone derivative. An embedded derivative causes some or all of the cash flows that otherwise would be required by the contract to be modified according to a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss.
If the hybrid contract contains a host that is a financial asset within the s
Mar 31, 2018
Basis of Preparation of Financial Statements:
The financial statements have been prepared in accordance with the Indian accounting standard (IND AS), notified under section 133 of the Companies Act 2013, and the relevant provisions of the Companies Act, 2013. The Company has adopted all the applicable IND AS. The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all the periods presented in the financial statements.
Use of Estimates:
The preparation of financial statements requires management to make judgements, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgements based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively.
Current and Non-Current Classification
All assets and liabilities have been classified as current or non current as per the Companyâs normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non current classification of assets and liabilities except for Real Estate.
Revenue Recognition:
Sale of goods:
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates. Revenue from the sale of goods are net of value added tax/good and service tax and exclusive of self-consumption.
Rendering of services:
Revenue from rendering of services is recognised by reference to the stage of completion. When the contract outcome cannot be measured reliably, revenue is recognised only to the extent that the expenses incurred are eligible to be recovered.
Time share weeks:
Advances received for time share weeks are reckoned as income in equal amounts spread over the time share period commencing from the year in which full payment is received.
Escalations/ claims/Variation:
Claims on construction contracts are taken based on Managementâs estimate of the probability that they will result in additional revenue, they are capable of being reliably measured, there is a reasonable basis to support the claim and that such claims would be admitted. The Company assesses the carrying value of various claims periodically, and makes adjustments for any unrecoverable amount arising from the legal/ arbitration proceedings/ negotiation with the clients that they may be involved in from time to time.
Revenue from Real Estate Developments:
Revenue from real estate development of constructed properties is recognised based on the âpercentage of completion methodâ. Revenue from real estate development of constructed properties for projects that are not recognised before 01.04.2012 is recognised when, at least 25% of total estimated construction and development costs have incurred, at least 25% of the saleable project area is secured by contracts or agreement with buyers and at least 10% of the contract consideration are realised at reporting date and it is reasonable to expect that the parties to such contracts will comply with the payment terms as defined in the contracts. Project costs includes cost of land, borrowing cost, cost of construction and development of such properties. The estimates of the saleable area and costs are reviewed periodically and effect of any changes in such estimates recognised in the period in which such changes are determined.
Revenue from sale/ sub-lease of undeveloped land is recognised when all significant risks and rewards of ownership in the property are transferred to the customer, it is probable that the economic benefits will flow to the Company, revenue can be reliably measured, company do not retain continuing managerial involvement to the degree associated with the ownership and costs in respect of transaction can be measured reliably.
Revenue from sale/ sub-lease of developed land/ plot, is recognised based on the âpercentage of completion methodâ.
Revenue from sale/ transfer of Development Rights is recognised when all significant risks and rewards of ownership in the development rights are transferred to the customer, it is probable that the economic benefits will flow to the Company, revenue can be reliably measured, company do not retain continuing managerial involvement to the degree associated with the ownership and costs in respect of transaction can be measured reliably.
Interest Income:
For all debt instruments measured either at amortised cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortised cost of a financial liability. When calculating the effective interest rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses. Interest income is included in Other income in the statement of profit and loss.
Dividends:
Revenue is recognised when the Companyâs right to receive the payment is established, which is generally when shareholders approve the dividend.
Royalties:
Royalties are accounted on an accrual basis in accordance with the substance of the relevant agreement.
Property, plant and equipment:
Property, plant and equipment are stated at cost [i.e., cost of acquisition or construction inclusive of freight, erection and commissioning charges, non-refundable duties and taxes, expenditure during construction period, borrowing costs (in case of a qualifying asset) up to the date of acquisition/ installation], net of accumulated depreciation and accumulated impairment losses, if any.
Capital work in progress, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset when the recognition criteria for a provision are met. Depreciation is calculated on straight line basis over the estimated useful lives of the assets as follows:
Freehold land is not depreciated.
As per IND AS 101, the Company has elected to continue the policy adopted for exchange differences arising from translation of long term foreign currency monetary items [recognised in the financial statements for the period immediately before the beginning of the first IND AS financial reporting as per previous GAAP] and capitalise/ adjusted Foreign Currency Rate Difference in the carrying value of the fixed asset.
âAssets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets. However, when there is no reasonable certainty that ownership will be obtained by the end of the lease term, assets are depreciated over the shorter of the lease term and their useful lives. The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.â
âAn item of property, plant and equipment and any significant part initially recognised is derecognised 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 recognised in profit or loss when the asset is derecognised.â
Intangible assets:
Intangible assets acquired separately are measured on initial recognition at cost which comprises purchase price (including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates) and any directly attributable cost of preparing the asset for its intended use. An intangible assets acquired in a business combination is recognised at fair value at the date of acquisition. After initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangible assets, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. Amortisation is recognised on a straight line basis over their estimated useful life. 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 being accounted for on a prospective basis. 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.
Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset is derecognised.
Computer Softwares is amortized over a period of 5 years. Government Grants:
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the company with no future related costs are recognised in statement of profit or loss in the period in which they become receivable. Grants related to depreciable assets are usually recognised in profit or loss over the periods and in the proportions in which depreciation expense on those assets is recognised. Grants related to non-depreciable assets may also require the fulfilment of certain obligations and would then be recognised in profit or loss over the periods that bear to the cost of meeting the obligations.
When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset. When loans or similar assistance or deferred liability are provided by governments, with nil interest rate or rate below the current applicable market rate, the effect of this favourable interest is regarded as a government grant. The loan or assistance is initially recognised and measured at fair value and the government grant is measured as the difference between the initial carrying value of the loan and the proceeds received. The loan is subsequently measured as per the accounting policy applicable to financial liabilities.
Foreign Currencies:
Functional Currency
The Companyâs financial statements are presented in INR, which is also its functional currency.
Transactions and balances:
Transactions in foreign currencies are initially recorded by the Company at functional currency spot rates at the date the transaction first qualifies for recognition. However, for practical reasons, the Company uses an average rate if the average approximates the actual rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss.
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. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in Other Comprehensive Income [OCI] or profit or loss are also recognised in OCI or profit or loss, respectively).
Inventories:
Inventories are valued at cost or net realisable value, whichever is less.
Costs incurred in bringing each product to its present location and conditions are accounted for as follows:
[i] Raw materials, construction materials, stores and spares, packing materials, stock of food and beverages, operating stores and supplies: cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
[ii] Finished goods/Stock in Process/Projects Under Development: cost includes cost of direct materials and labour and a systematic allocation of fixed and variable production overheads that are incurred in converting materials into finished goods, borrowing costs of qualifying asset.
[iii] Traded Goods : cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
Borrowing Costs:
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset, 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 the asset. The borrowing cost cease to capitalise when the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes finance charges in respect of finance lease and exchange differences arising from foreign currency borrowing to the extent regarded as an adjustment to the interest costs.
Employee benefits:
The undiscounted amount of short-term employee benefits i.e. wages and salaries, bonus, incentive, annual leave and sick leave etc. expected to be paid in exchange for the service rendered by employees are recognized as an expense except in so far as employment costs may be included within the cost of an asset during the period when the employee renders the services.
Retirement benefit in the form of provident fund and pension contribution is a defined contribution scheme and is recognized as an expense except in so far as employment costs may be included within the cost of an asset.
Gratuity and leave encashment is a defined benefit obligation. The liability is provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is done as per Projected Unit Credit method.
Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to profit or loss through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.
Leases:
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of the ownership to the lessee. All other leases are classified as operating leases.
Company as lessee:
Asset held under finance leases are initially recognised as assets at its fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised immediately in the statement of profit and loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Companyâs general policy on the borrowing costs. Contingent rentals are recognised as expenses in the periods in which they are incurred.
A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.
Operating lease payments are recognised as an expense in the statement of profit and loss on a straight-line basis over the lease term unless either:
[i] another systematic basis is more representative of the time pattern of the userâs benefit even if the payments to the lessors are not on that basis or
[ii] the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessorâs expected inflationary cost increases. If payments to the lessor vary because of factors other than general inflation, then this condition is not met.
Company as lessor:
Amounts due from lessee under finance leases are recorded as receivables at the Companyâs net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.
Rental income from operating lease is recognised on a straight-line basis over the term of the relevant lease unless either:
[i] another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished, even if the payments to the lessors are not on that basis; or
[ii] the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessorâs expected inflationary cost increases. If payments to the lessor vary according to factors other than inflation, then this condition is not met.
Research and development costs
Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate:
[i] The technical feasibility of completing the intangible asset so that the asset will be available for use or sale
[ii] Its intention to complete and its ability and intention to use or sell the asset
[iii] How the asset will generate future economic benefits
[iv] The availability of resources to complete the asset
[v] The ability to measure reliably the expenditure during development
Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over the period of expected future benefit. Amortisation expense is recognised in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.
During the period of development, the asset is tested for impairment annually.
Impairment of non-financial assets:
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the assetâs recoverable amount. An assetâs recoverable amount is the higher of an assetâs or cash-generating unitâs (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets.
When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
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. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.
Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of profit and loss, except for properties previously revalued with the revaluation surplus taken to OCI. For such properties, the impairment is recognised in OCI up to the amount of any previous revaluation surplus.
For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the assetâs or CGUâs recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assetâs recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation change. Goodwill is tested for impairment as at each Balance Sheet date and when circumstances indicate that the carrying value may be impaired.
Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.
Intangible assets with indefinite useful lives are tested for impairment annually as at each Balance sheet date at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.
Provisions
General:
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate.
When the Company expects some or all of a provision to be reimbursed (like under an insurance contract, indemnity clauses or suppliersâ warranties) and the Company is solely liable to pay the liability, the reimbursement is recognised as a separate asset. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement if the Company is not solely liable to pay the liability. The reimbursement of provision is only recognized when it is virtually certain that the company will receive the reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Restructuring Provisions:
Restructuring provisions are recognised only when the Company has a constructive obligation, which is when a detailed formal plan identifies the business or part of the business concerned, the location and number of employees affected, a detailed estimate of the associated costs, and an appropriate timeline, and the employees affected have been notified of the planâs main features.
Warranties:
A warranty provision is recognised for the best estimate of the expenditure that will be required to settle the company obligation of relevant goods.
Decommissioning Liability:
The Company records a provision for decommissioning costs with respect to manufacturing units/ project sites etc. Decommissioning costs are provided at the present value of expected costs to settle the obligation using estimated cash flows and are recognised as part of the cost. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognised in the statement of profit and loss as a finance cost. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.
Contingent Liabilities/ Contingent Assets:
Contingent Liabilities are not recognized but are disclosed in the notes unless the possibility of an outflow of resources embodying economic benefits is remote. Contingent assets are disclosed in the financial statements only when the inflow of economic benefits is probable. Contingent liability and Contingent assets are reviewed at each reporting date.
Taxes:
Tax expense represents the sum of the current income tax and deferred tax.
Current income tax:
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted in India, at the reporting date.
Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax:
Deferred tax is recognized on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses 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 to allow all or part of the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Current and deferred tax are recognised in profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity respectively.
Non-current assets held for sale/ distribution to owners and discontinued operations
The Company classifies non-current assets (or disposal groups) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Held for sale is classified only if the asset (or disposal group) is available for immediate sale in its present condition subject only to the terms that are usual and customary for sale for such assets (or disposal group) and its sale is highly probable i.e. Management is committed to sale, which is expected to be completed within one year from date of classification.
Sale transactions include exchanges of non-current assets for other non-current assets when the exchange has commercial substance. Non-current assets (or disposal group) that is to be abandoned are not classified as held for sale
Non-current assets held for sale and disposal groups are measured at the lower of their carrying amount and the fair value less costs to sell. Assets and liabilities classified as held for sale are presented separately in the balance sheet.
Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale are continue to be recognised.
Non-current asset (or disposal group) is reclassified from held to sale if the criteria are no longer met and measured at lower of:
[i] Its carrying amount before the asset (or Disposal group) was classified as held for sale, adjusted for any depreciation, amortisation or revaluations that would have been recognised had the asset (or disposal group) not been classified as held for sale, and
[ii] Its recoverable amount at the date of the subsequent decision not to sell.
Any adjustment to the carrying amount of a noncurrent asset that ceases to be classified as held for sale is charged to profit or loss from continuing operations in the period in which criteria are no longer met.
A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed off, or is classified as held for sale, and:
[i] Represents a separate major line of business or geographical area of operations
[ii] Is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations, or
[iii] Is a subsidiary acquired exclusively with a view to resale.
Fair value measurement
The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.
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. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
[i] In the principal market for the asset or liability, or
[ii] In the absence of a principal market, in the most advantageous market accessible by the Company for the asset or liability.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participantâs ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
[i] Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
[ii] Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
[iii] Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing 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.
The Company determines the policies and procedures for both recurring fair value measurement, such as derivative instruments and unquoted financial assets measured at fair value, and for non-recurring measurement, such as assets held for distribution in discontinued operations. External valuers are involved for valuation of significant assets, such as properties and unquoted financial assets, and significant liabilities, such as contingent consideration. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained.
At each reporting date, the Company analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Companyâs accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
The Company, in conjunction with the Companyâs external valuers, also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
Convertible Preference Shares/ Bonds [Liability]
Convertible Preference Shares/ Bonds are separated into liability and equity components based on the terms of the contract.
On issuance of the convertible Preference Shares/ Bonds, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument. This amount is classified as a financial liability measured at amortised cost (net of transaction costs) until it is extinguished on conversion or redemption.
The remainder of the proceeds is allocated to the conversion option that is recognised as equity. Transaction costs are deducted from equity, net of associated income tax. The carrying amount of the conversion option is not remeasured in subsequent years.
Transaction costs are apportioned between the liability and equity components of the Preference Shares/ Bonds based on the allocation of proceeds to the liability and equity components when the instruments are initially recognised.
Cash and Cash Equivalents
Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are 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.
Earnings per share
Basic earnings per equity share is computed by dividing net profit after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing adjusted net profit after tax by the aggregate of weighted average number of equity shares and dilutive potential equity shares during the year.
Financial instruments
Financial assets and liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Financial Assets
Initial Recognition & measurements
Financial instruments are initially measured at fair value including transaction costs unless they are classified at fair value through profit and loss, in which case the transaction costs are expensed immediately. Subsequent to initial recognition, these instruments are measured in accordance with their classification as set out below.
Subsequent measurement
Measurement of financial assets is done as below:
[i] Amortised cost, if the financial asset is held within a business model whose object is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specific dates to cash flows that are solely payments of principal and interest on the principal amount outstanding,
[ii] Fair value through profit or loss (FVTPL)
Investment in Subsidiaries, Associates and Joint Ventures The Company has accounted for its investments in subsidiaries, associates and joint venture at cost.
Other Equity Investments
All equity investments [other than invesment in Subsidiaries, Associates and Joint Ventures] are measured at fair value, with value changes recognised in Statement of Profit and Loss.
De-recognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily de-recognised when:
[i] The rights to receive cash flows from the asset have expired, or
[ii] The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass-throughâ arrangement and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
On derecognising of a financial asset in its entirety, the difference between the assetâs carrying amount and the sum of the consideration received or receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss.
Impairment of financial assets
In accordance with IND AS 109, the company applies expected credit loss (ECL) Model for measurement & recognition of impairment loss on the following financial assets & credit risk exposure.
[i] Financial assets that are debt instruments, and are measured at amortised cost, e.g. loans, debt securities, deposits, trade receivables and bank balance
[ii] Financial assets that are debt instruments and are measured as at FVTPL.
[iii] Lease receivables under Ind AS 17.
[iv] Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind AS 11 and Ind AS 18.
[v] Loan commitments which are not measured as at FVTPL.
[vi] Financial guarantee contracts which are not measured as at FVTPL.
The Company follows âsimplified approachâ for recognition of impairment loss allowance on:
[i] Trade receivables or contract revenue receivables; and
[ii] All lease receivables resulting from transactions within the scope of Ind AS 17
The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.
ECL impairment loss allowance (or reversal) recognized during the period as income / expense in the statement of profit and loss.
Financial assets measured as at amortised cost, contractual revenue receivables and lease receivables: ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets writeoff criteria, the Company does not reduce impairment allowance from the gross carrying amount.
For assessing increase in credit risk and impairment loss, the Company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis. Financial liabilities Initial recognition & measurement
All Financial liabilities are recognised initially at fair value and in case of loan & borrowings and payable, net-off directly attributable transaction cost.
The Companyâs financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments
Gains or losses on liabilities held for trading are recognised in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the Effective Interest Rate [EIR] method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.
Embedded derivatives
An embedded derivative is a component of a hybrid (combined) instrument that also includes a non-derivative host contract - with the effect that some of the cash flows of the combined instrument vary in a way similar to a standalone derivative. An embedded derivative causes some or all of the cash flows that otherwise would be required by the contract to be modified according to a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss.
If the hybrid contract contains a host that is a financial asset within the scope of Ind AS 109, the Company does not separate embedded derivatives. Rather, it applies the classification requirements contained in Ind AS 109 to the entire hybrid contract. Derivatives embedded in all other host contracts are accounted for as separate derivatives and recorded at fair value if their economic characteristics and risks are not closely related to those of the host contracts and the host contracts are not held for trading or designated at fair value though profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognised in profit or loss, unless designated as effective hedging instruments.
Reclassification of financial assets
The company reclassify all affected financial assets prospectively when, and only when company changes its business model for managing financial assets but financial liability is not reclassified in any case.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Business Combination
Business combinations are accounted for using the acquisition accounting method as at the date of the acquisition, which is the date at which control is transferred to the Company. The consideration transferred in the acquisition and the identifiable assets acquired and liabilities assumed are recognised at fair values on their acquisition date. Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. Transaction costs are expensed as incurred, other than those incurred in relation to the issue of debt or equity securities. Any contingent consideration payable is measured at fair value at the acquisition date. Subsequent changes in the fair value of contingent consideration are recognised in the Statement of Profit and Loss.
Operating Segment
The Operating Segment is the level at which discrete financial information is available. The âChief Operating Decision Makerâ (CODM) allocates resources and assess performance at this level. The Group has identified the below operating segments:
1. Construction
2. Cement
3. Hotel / Hospitality
4. Sports Events
5. Real Estate
6. Power
7. Investments
Standards Issued but not Effective
On March 28, 2018, the Ministry of Corporate Affairs (MCA) has notified Ind AS 115 - Revenue from Contract with Customers and certain amendment to existing Ind AS. These amendments shall be applicable to the Company from April 01, 2018.
(a) Issue of Ind AS 115 - Revenue from Contracts with Customers
Ind AS 115 will supersede the current revenue recognition guidance including Ind AS 18 Revenue, Ind AS 11 Construction Contracts and the related interpretations. Ind AS 115 provides a single model of accounting for revenue arising from contracts with customers based on the identification and satisfaction of performance obligations.
(b) Amendment to Existing issued Ind AS
The MCA has also carried out amendments of the following accounting standards:
i. I nd AS 21 - The Effects of Changes in Foreign Exchange Rates
ii. Ind AS 40 - Investment Property
iii. Ind AS 12 - Income Taxes
iv. Ind AS 28 - Investments in Associates and Joint Ventures and
v. I nd AS 112 - Disclosure of Interests in Other Entities
The Company is under process of assessing the impact of application of IND AS 115 and amendments to other standards.
Mar 31, 2017
NOTE No. â1" CORPORATE INFORMATION
Jaiprakash Associates Limited is a Public Limited Company domiciled in India with its registered office located at Sector-128, Noida-201304 (U.P). The shares of the Company are listed on the National Stock Exchange and the Bombay Stock Exchange. The company is mainly engaged in the business of Engineering & Construction, Manufacturing of Cement, Real Estate development, Hotel, Sports. The company''s financial statements are approved for issue in accordance with a resolution of the directors on 29th May, 2017.
SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation of Financial Statements:
The financial statements have been prepared in accordance with the Indian accounting standard (IND AS), notified under section 133 of the Companies Act 2013, and the relevant provisions of the Companies Act, 2013. The Company has adopted all the applicable IND AS standards and the adoption was carried out in accordance with IND AS 101, first time adoption of Indian Accounting Standards. The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all the periods presented in the financial statements, including the preparation of the opening IND AS Balance Sheet as at 1st April, 2015 being the ''date of transition to IND AS''.
Use of Estimates:
The preparation of financial statements requires management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognized prospectively.
Current and non-current classification
All assets and liabilities have been classified as current or noncurrent as per the Company''s normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or noncurrent classification of assets and liabilities except for Real Estate.
Revenue Recognition:
Sale of goods:
Revenue from the sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates. Revenue from the sale of goods are net of value added tax and exclusive of self-consumption.
Rendering of services:
Revenue from rendering of services is recognized by reference to the stage of completion. When the contract outcome cannot be measured reliably, revenue is recognized only to the extent that the expenses incurred are eligible to be recovered.
Time share weeks:
Advances received for time share weeks are reckoned as income in equal amounts spread over the time share period commencing from the year in which full payment is received.
Escalations/ claims/Variation:
Escalations/ claims are taken in the accounts on the basis of receipt or as acknowledged by the client depending upon the certainty of receipt.
Revenue from Real Estate Developments:
Revenue from real estate development of constructed properties is based on the ''percentage of completion method''. Revenue from real estate development of constructed properties for projects that are not recognized before 01.04.2012 is recognized when, at least 25% of construction and development costs have incurred, at least 25% of the saleable project area is secured by contracts or agreement with buyers and at least 10% of the contract consideration are realized and it is reasonable to expect that the parties to such contracts will comply with the payment terms as defined in the contracts. Project costs includes cost of land, borrowing cost, cost of construction and development of such properties. The estimates of the saleable area and costs are reviewed periodically and effect of any changes in such estimates recognized in the period such changes are determined.
Revenue from sale/ sub-lease of undeveloped land is recognized when all significant risks and rewards are transferred to the customer, it is probable that the economic benefits will flow to the Company, revenue can be reliably measured, company do not retain continuing managerial involvement to the degree associated with the ownership and costs in respect of transaction can be measured reliably.
Revenue from sale/ sub-lease of developed land/ plot, is recognized based on the ''percentage of completion method''
Revenue from sale/ transfer of Development Rights is recognized when all significant risks and rewards are transferred to the customer, it is probable that the economic benefits will flow to the Company, revenue can be reliably measured, company do not retain continuing managerial involvement to the degree associated with the ownership and costs in respect of transaction can be measured reliably.
Interest Income:
For all debt instruments measured either at amortized cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortized cost of a financial liability. When calculating the effective interest rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses. Interest income is included in Other income in the statement of profit and loss.
Dividends:
Revenue is recognized when the Company''s right to receive the payment is established, which is generally when shareholders approve the dividend.
Royalties:
Royalties are accounted on an accrual basis in accordance with the substance of the relevant agreement.
Property, plant and equipment:
Property, plant and equipment are stated at cost [i.e., cost of acquisition or construction inclusive of freight, erection and commissioning charges, non-refundable duties and taxes, expenditure during construction period, borrowing costs (in case of a qualifying asset) up to the date of acquisition/ installation], net of accumulated depreciation and accumulated impairment losses, if any.
Capital work in progress, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset when the recognition criteria for a provision are met.
Freehold land is not depreciated.
As per IND AS 101, the Company has elected to continue the policy adopted for exchange differences arising from translation of long term foreign currency monetary items [recognized in the financial statements for the period immediately before the beginning of the first IND AS financial reporting as per previous GAAP] and capitalize/ adjusted Foreign Currency Rate Difference in the carrying value of the fixed asset.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets. However, when there is no reasonable certainty that ownership will be obtained by the end of the lease term, assets are depreciated over the shorter of the lease term and their useful lives. The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.
An item of property, plant and equipment and any significant part initially recognized is derecognized 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 profit or loss when the asset is derecognized.
Intangible assets:
Intangible assets acquired separately are measured on initial recognition at cost which comprises purchase price (including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates) and any directly attributable cost of preparing the asset for its intended use. An intangible assets acquired in a business combination is recognized at fair value at the date of acquisition. After initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses. Internally generated intangible assets, excluding capitalised development costs, are not capitalized and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
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. Amortization is recognized on a straight line basis over their estimated useful life. The amortization period and the amortization 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 amortization period or method, as appropriate, and are treated as changes in accounting estimates being accounted for on a prospective basis. The amortization expense on intangible assets with finite lives is recognized in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.
Intangible assets with indefinite useful lives are not amortized , but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.
An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from 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 or loss when the asset is derecognized.
Computer Softwareâs is amortized over a period of 5 years. Government Grants:
Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the company with no future related costs are recognized in profit or loss in the period in which they become receivable. Grants related to depreciable assets are usually recognized in profit or loss over the periods and in the proportions in which depreciation expense on those assets is recognized. Grants related to non-depreciable assets may also require the fulfillment of certain obligations and would then be recognized in profit or loss over the periods that bear to the cost of meeting the obligations.
When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset, i.e., by equal annual installments. When loans or similar assistance or deferred liability are provided by governments, with nil interest rate or rate below the current applicable market rate, the effect of this favorable interest is regarded as a government grant. The loan or assistance is initially recognized and measured at fair value and the government grant is measured as the difference between the initial carrying value of the loan and the proceeds received. The loan is subsequently measured as per the accounting policy applicable to financial liabilities.
Foreign Currencies:
Functional Currency
The Company''s financial statements are presented in INR, which is also its functional currency
Transactions and balances:
Transactions in foreign currencies are initially recorded by the Company at functional currency spot rates at the date the transaction first qualifies for recognition. However, for practical reasons, the Company uses an average rate if the average approximates the actual rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. 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. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognized in Other Comprehensive Income [OCI] or profit or loss are also recognized in OCI or profit or loss, respectively).
Inventories:
Inventories are valued at cost or net realizable value, whichever is less.
Costs incurred in bringing each product to its present location and conditions are accounted for as follows:
[i] Raw materials, construction materials, stores and spares, packing materials, stock of food and beverages, operating stores and supplies: cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
[ii] Finished goods and work in progress / Stock in Process: cost includes cost of direct materials and labour and a systematic allocation of fixed and variable production overheads that are incurred in converting materials into finished goods, borrowing costs of qualifying asset. In case of item rate contract, work in progress is measured on the basis of physical measurement of work actually completed as at the balance sheet date. In case of cost plus contracts, work in progress is taken as cost not billed on the contracted.
[iii] Traded Goods : cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
Borrowing Costs:
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset, that necessarily takes a substantial period of time to get ready for its intended use or sale, are capitalized as part of the cost of the asset. The borrowing cost cease to capitalize when the assets are substantially ready for their intended use or sale.
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 period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes finance charges in respect of finance lease and exchange differences arising from foreign currency borrowing to the extent regarded as an adjustment to the interest costs.
Employee benefits:
The undiscounted amount of short-term employee benefits i.e. wages and salaries, bonus, incentive, annual leave and sick leave etc. expected to be paid in exchange for the service rendered by employees are recognized as an expense except in so far as employment costs may be included within the cost of an asset during the period when the employee renders the services.
Retirement benefit in the form of provident fund and pension contribution is a defined contribution scheme. and is recognized as an expense except in so far as employment costs may be included within the cost of an asset.
Gratuity and leave encashment is a defined benefit obligation. The liability is provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is done as per Projected Unit Credit method.
Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognized immediately in the balance sheet with a corresponding debit or credit to profit or loss through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.
Leases:
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of the ownership to the lessee. All other leases are classified as operating leases.
Company as lessee:
Asset held under finance leases are initially recognized as assets at its fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized immediately in the statement of profit and loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Company''s general policy on the borrowing costs. Contingent rentals are recognized as expenses in the periods in which they are incurred.
A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.
Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term unless either:
[i] another systematic basis is more representative of the time pattern of the user''s benefit even if the payments to the lessons are not on that basis or
[ii] the payments to the less or are structured to increase in line with expected general inflation to compensate for the less orâs expected inflationary cost increases. If payments to the less or vary because of factors other than general inflation, then this condition is not met.
Company as less or:
Amounts due from lessees under finance leases are recorded as receivables at the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.
Rental income from operating lease is recognized on a straight-line basis over the term of the relevant lease unless either:
[i] another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished, even if the payments to the lessons are not on that basis; or
[ii] the payments to the less or are structured to increase in line with expected general inflation to compensate for the less orâs expected inflationary cost increases. If payments to the less or vary according to factors other than inflation, then this condition is not met.
Research and development costs
Research costs are expensed as incurred. Development expenditures on an individual project are recognized as an intangible asset when the Company can demonstrate:
[i] The technical feasibility of completing the intangible asset so that the asset will be available for use or sale
[ii] Its intention to complete and its ability and intention to use or sell the asset
[iii] How the asset will generate future economic benefits
[iv] The availability of resources to complete the asset
[v] The ability to measure reliably the expenditure during development
Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortization and accumulated impairment losses. Amortization of the asset begins when development is complete and the asset is available for use. It is amortized over the period of expected future benefit. Amortization expense is recognized in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.
During the period of development, the asset is tested for impairment annually.
Impairment of non-financial assets:
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
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. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.
Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss, except for properties previously revalued with the revaluation surplus taken to OCI. For such properties, the impairment is recognized in OCI up to the amount of any previous revaluation surplus.
For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognized impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset''s or CGU''s recoverable amount. A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last impairment loss was recognized. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.
Goodwill is tested for impairment as at each Balance Sheet date and when circumstances indicate that the carrying value may be impaired.
Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognized. Impairment losses relating to goodwill cannot be reversed in future periods.
Intangible assets with indefinite useful lives are tested for impairment annually as at each Balance sheet date at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.
Provisions
General:
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. When the Company expects some or all of a provision to be reimbursed (like under an insurance contract, indemnity clauses or suppliers'' warranties) and the Company is solely liable to pay the liability, the reimbursement is recognized as a separate asset. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement if the Company is not solely liable to pay the liability. The reimbursement of provision is only recognized when it is virtually certain that the company will receive the reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
Restructuring Provisions:
Restructuring provisions are recognized only when the Company has a constructive obligation, which is when a detailed formal plan identifies the business or part of the business concerned, the location and number of employees affected, a detailed estimate of the associated costs, and an appropriate timeline, and the employees affected have been notified of the plan''s main features.
Warranties:
A warranty provision is recognized for the best estimate of the expenditure that will be required to settle the company obligation of relevant goods.
Decommissioning Liability:
The Company records a provision for decommissioning costs with respect to manufacturing units/ project sites etc. Decommissioning costs are provided at the present value of expected costs to settle the obligation using estimated cash flows and are recognized as part of the cost. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognized in the statement of profit and loss as a finance cost. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.
Contingent Liabilities/ Contingent Assets:
Contingent Liabilities are not recognized but are disclosed in the notes unless the possibility of an outflow of resources embodying economic benefits is remote. Contingent assets are disclosed in the financial statements only when the inflow of economic benefits is probable. Contingent liability and contingent assets are reviewed at each reporting date.
Taxes:
Tax expense represents the sum of the current income tax and deferred tax.
Current income tax:
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted in India, at the reporting date.
Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax:
Deferred tax is recognized on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax assets are recognized for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized
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 to allow all or part of the deferred tax asset to be utilized.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Current and deferred tax are recognized in profit and loss, except when they relate to items that are recognized in other comprehensive income or directly in equity respectively.
Non-current assets held for sale/ distribution to owners and discontinued operations
The Company classifies non-current assets (or disposal groups) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Held for sale is classified only if the asset (or disposal group) is available for immediate sale in its present condition subject only to the terms that are usual and customary for sale for such assets (or disposal group) and its sale is highly probable i.e. Management is committed to sale, which is expected to be completed within one year from date of classification.
Sale transactions include exchanges of non-current assets for other non-current assets when the exchange has commercial substance. Non-current assets (or disposal group) that is to be abandoned are not classified as held for sale
Non-current assets held for sale and disposal groups are measured at the lower of their carrying amount and the fair value less costs to sell. Assets and liabilities classified as held for sale are presented separately in the balance sheet.
Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale are continue to be recognized.
Non-current asset (or disposal group) is reclassified from held to sale if the criteria are no longer met. And measured at lower of:
[i] Its carrying amount before the asset (or Disposal group) was classified as held for sale, adjusted for any depreciation, amortization or revaluations that would have been recognized had the asset (or disposal group) not been classified as held for sale, and
[ii] Its recoverable amount at the date of the subsequent decision not to sell.
Any adjustment to the carrying amount of a noncurrent asset that ceases to be classified as held for sale is charged to profit or loss from continuing operations in the period in which criteria are no longer met.
A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed off, or is classified as held for sale, and:
[i] Represents a separate major line of business or geographical area of operations
[ii] Is part of a single co-ordinate plan to dispose of a separate major line of business or geographical area of operations, or
[iii] Is a subsidiary acquired exclusively with a view to resale
Fair value measurement
The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.
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. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
[i] In the principal market for the asset or liability, or
[ii] I n the absence of a principal market, in the most advantageous market for the asset or liability
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
[i] Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
[ii] Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
[iii] Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognized in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
The Company determines the policies and procedures for both recurring fair value measurement, such as derivative instruments and unquoted financial assets measured at fair value, and for non-recurring measurement, such as assets held for distribution in discontinued operations. External valuers are involved for valuation of significant assets, such as properties and unquoted financial assets, and significant liabilities, such as contingent consideration. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. At each reporting date, the Company analyses the movements in the values of assets and liabilities which are required to be premeasured or re-assessed as per the Company''s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
The Company, in conjunction with the Company''s external valuers, also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
Convertible Preference Shares/ Bonds
Convertible Preference Shares/ Bonds are separated into liability and equity components based on the terms of the contract.
On issuance of the convertible Preference Shares/ Bonds, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument. This amount is classified as a financial liability measured at amortized cost (net of transaction costs) until it is extinguished on conversion or redemption.
The remainder of the proceeds is allocated to the conversion option that is recognized as equity. Transaction costs are deducted from equity, net of associated income tax. The carrying amount of the conversion option is not premeasured in subsequent years.
Transaction costs are apportioned between the liability and equity components of the Preference Shares/ Bonds based on the allocation of proceeds to the liability and equity components when the instruments are initially recognized.
Cash and Cash Equivalents
Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are 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.
Earnings per share
Basic earnings per equity share is computed by dividing net profit after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing adjusted net profit after tax by the aggregate of weighted average number of equity shares and dilutive potential equity shares during the year.
Financial instruments
Financial assets and liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Financial Assets
Initial Recognition & measurements
Financial instruments are initially measured at fair value including transaction costs unless they are classified at fair value through profit and loss, in which case the transaction costs are expensed immediately. Subsequent to initial recognition, these instruments are measured in accordance with their classification as set out below.
Subsequent measurement
Financial assets are classified in four categories:
[i] Amortized cost, if the financial asset is held within a business model whose object is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specific dates to cash flows that are solely payments of principal and interest on the principal amount outstanding,
[ii] Fair value through other comprehensive income (FVOCI), if the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified date to cash flows that are solely payment of principal and interest on the principal amount outstanding. Any interest income, impairment losses & reversals and foreign exchange gain or loss is recognized in Profit or loss.
[iii] Fair value through other comprehensive income, if the financial assets is investment in an equity instrument within the scope of this standard, that is neither held for trading nor contingent consideration recognized by company in a business combination, for which the company make an irrevocable election to present subsequent changes in fair value in other comprehensive income. Any dividend is recognized in profit or loss, or
[iv] Fair value through profit or loss (FVTPL) De-recognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily de-recognized when:
[i] The rights to receive cash flows from the asset have expired, or.
[ii] The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
On derecognizing of a financial asset in its entirety, the difference between the asset''s carrying amount and the sum of the consideration received or receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss.
Impairment of financial assets
In accordance with Ind AS 109, the company applies expected credit loss (ECL) Model for measurement & recognition of impairment loss on the following financial assets & credit risk exposure.
[i] Financial assets that are debt instruments, and are measured at amortized cost, e.g. loans, debt securities, deposits, trade receivables and bank balance
[ii] Financial assets that are debt instruments and are measured as at FVTPL.
[iii] Lease receivables under Ind AS 17.
[iv] Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind AS 11 and Ind AS 18.
[v] Loan commitments which are not measured as at FVTPL.
[vi] Financial guarantee contracts which are not measured as at FVTPL.
The Company follows ''simplified approach'' for recognition of impairment loss allowance on:
[i] Trade receivables or contract revenue receivables; and
[ii] All lease receivables resulting from transactions within the scope of Ind AS 17
The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognizing impairment loss allowance based on 12-month ECL.
ECL impairment loss allowance (or reversal) recognized during the period as income / expense in the statement of profit and loss.
Financial assets measured as at amortized cost, contractual revenue receivables and lease receivables: ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying amount.
For assessing increase in credit risk and impairment loss, the Company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis
Financial liabilities
Initial recognition & measurement
All Financial liabilities are recognized initially at fair value and in case of loan & borrowings and payable, net-off directly attributable transaction cost.
The Company''s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments
Gains or losses on liabilities held for trading are recognized in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains / losses are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognized in the statement of profit & loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the Effective Interest Rate [EIR] method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process.
Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit & loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognized initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognized less cumulative amortization .
Derecognition
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit & loss.
Embedded derivatives
An embedded derivative is a component of a hybrid (combined) instrument that also includes a non-derivative host contract - with the effect that some of the cash flows of the combined instrument vary in a way similar to a standalone derivative. An embedded derivative causes some or all of the cash flows that otherwise would be required by the contract to be modified according to a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit & loss.
If the hybrid contract contains a host that is a financial asset within the scope of Ind AS 109, the Company does not separate embedded derivatives. Rather, it applies the classification requirements contained in Ind AS 109 to the entire hybrid contract. Derivatives embedded in all other host contracts are accounted for as separate derivatives and recorded at fair value if their economic characteristics and risks are not closely related to those of the host contracts and the host contracts are not held for trading or designated at fair value though profit & loss. These embedded derivatives are measured at fair value with changes in fair value recognized in profit & loss, unless designated as effective hedging instruments.
Reclassification of financial assets
The company reclassify all affected financial assets prospectively when, and only when company changes its business model for managing financial assets but financial liability is not reclassified in any case.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Business Combination
Business combinations are accounted for using the acquisition accounting method as at the date of the acquisition, which is the date at which control is transferred to the Company. The consideration transferred in the acquisition and the identifiable assets acquired and liabilities assumed are recognized at fair values on their acquisition date. Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognized for non controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed.
Transaction costs are expensed as incurred, other than those incurred in relation to the issue of debt or equity securities. Any contingent consideration payable is measured at fair value at the acquisition date. Subsequent changes in the fair value of contingent consideration are recognized in the Statement of Profit and Loss.
Operating Segment
The Operating Segment is the level at which discrete financial information is available. The âChief Operating Decision Maker" (CODM) allocates resources and assess performance at this level. The Group has identified the below operating segments:
1. Construction
2. Cement
3. Hotel / Hospitality
4. Sports Events
5. Real Estate
6. Power
7. Investments
Mar 31, 2015
[A] SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation of Financial Statements:
The Financial Statements have been prepared to comply with the
Generally Accepted Accounting Principles in India (Indian GAAP),
including the Accounting Standards specified under section 133 of the
Companies Act, 2013, read with rule 7 of the Companies (Accounts)
Rules, 2014 and the relevant provisions of the Companies Act, 2013.
General:
[i] The Accounts are prepared on the historical cost basis except for
certain assets which are revalued.
[ii] The Accounts are prepared on the principles of a going concern.
[iii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue is recognised when it can be reliably measured and it is
reasonable to expect ultimate collection.
[ii] Revenue from Sale of Goods transactions (excluding transactions
for which Revenue recognition policy is specifically mentioned below)
is recognised when significant risks and rewards of ownership have been
transferred to the buyer and no significant uncertainty exists
regarding amount of consideration. Cement Sales / Clinker Sales/ Others
are net of Excise Duty/ Value Added Tax and exclusive of Self
Consumption.
[iii] Revenue from Sale of service transactions are recognised when no
significant uncertainty exists regarding the amount of consideration
that will be derived from rendering the service.
[iv] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[v] Escalations/Claims are taken in the Accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
of receipt.
[vi] Revenue from Real Estate Development of constructed properties is
recognised based on the "Percentage of completion method". Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease,
all significant risks and rewards are transferred to the customer and
possession is handed over.
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "Percentage of completion method" when a firm agreement
has been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
The revenue in respect of projects undertaken on or after 1st April,
2012 or where the revenue is being recognised for the first time after
1st April, 2012 is recognised in accordance with the Guidance Note on
Accounting for Real Estate Transactions [Revised 2012] issued by
Institute of Chartered Accountants of India.
[vii] (a) The costs that are incurred before a construction contract is
secured are treated as expenses for the year in which these are
incurred and charged to revenue.
(b) The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifiable to a specified contract are charged to the
general revenue in the year in which such costs are incurred.
[viii] Dividend Income is recognized when right to receive payment is
established.
[ix] Interest is recognised on a time proportion basis taking into
account the amount outstanding and the interest rate applicable.
[x] Royalties are accounted on accrual basis in accordance with the
terms of the relevant agreement.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities,
disclosure of contingent liabilities on the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Differences between actual results and estimates are
recognised in the period in which the results are known/materialised.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs up to the date of acquisition/ installation and net
of recoverable taxes. Major Expenditure in Hotel properties involving
relocation and redesigning of various outlets, guest floors and
additions thereto, enhancement in the value of assets and revenue
generating capacity is capitalised. Foreign Exchange Rate Difference on
long term monetary items arising on settlement or at reporting dates
attributable to Fixed Assets is capitalised/adjusted in the carrying
value of the Fixed Assets.
Depreciation & Amortisation:
[i] Depreciation on Tangible Fixed Assets is provided on Straight Line
Method depending on useful life of the assets as prescribed in
Schedule-II to the Companies Act, 2013.
[ii] Computer Softwares [Intangible Assets] is amortised over a period
of five years.
[iii] Premium on Lease-hold Land [except in case of perpetual lease] is
amortised over the period of lease.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or quoted/
fair value, computed categorywise.
Employee Benefits:
Employee Benefits are provided in the books as per AS -15 in the
following manner :
[i] The undiscounted amount of short term employee benefits expected to
be paid in exchange for the services rendered by employees are
recognised during the period when the employee render the services.
[ii] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Plan and is accounted on accrual
basis.
[iii] Gratuity and Leave Encashment is a Defined Benefit obligation.
The liability is provided for on the basis of actuarial valuation made
at the end of each financial year. The actuarial valuation is done as
per Projected Unit Credit method.
Inventories :
[i] Inventories are valued at Cost or Net Realisable Value whichever is
lower. Cost of Inventories comprises of cost of purchase, cost of
conversion and other costs incurred in bringing the inventories to
their present location and condition. Cost of Raw Materials,
Construction Materials, Stores & Spares, Packing Materials, Stock of
Food & Beverages, Operating Stores and supplies are determined on
Weighted Average basis.
[ii] Work-in-Progress/Stock-in-Process are valued at cost. In case of
Item Rate Contract work in progress is measured on the basis of
physical measurement of work actually completed as at the balance sheet
date. In case of cost plus contracts work in progress is taken as cost
not billed on the contractee.
[iii] Stock of Finished Goods lying in the factory premises includes
excise duty, pursuant to accounting standard [AS-2].
[iv] Goods-in-Transit at Cost incurred.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
related costs.
Foreign Currency Transactions:
[i] Transactions denominated in Foreign Currency are recorded in the
Books of Account in Indian Rupees at the rate of exchange prevailing on
the date of transaction.
[ii] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
The exchange difference arising either on settlement or at reporting
date is recognised in the Statement of Profit & Loss except in cases
where they relate to acquisition of fixed assets, in which case they
are adjusted to the carrying cost of such assets.
[iii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Statement of Profit & Loss except in cases where
they relate to acquisition of fixed assets, in which case they are
adjusted to the carrying cost of such assets. Premium paid in respect
of Hedge Contracts are recognised in the Statement of Profit & Loss,
except in case where they relate to the acquisition or construction of
fixed assets, in which case, they are adjusted to the carrying cost of
such assets.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not
use derivative financial instrument for speculative purposes.
[v] Non Monetary foreign currency items are carried at cost.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets and
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount disclosed as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Statement of Profit
& Loss.
Research and Development:
Revenue expenditure on Research and Development is charged to Statement
of Profit & Loss in the year in which it is incurred. Capital
expenditure on Research and Development is shown as an addition to
Fixed Assets.
Miscellaneous Expenditure:
Share/Debenture Issue Expenses are adjusted against Security Premium
Reserve in the year in which they are incurred.
Incidental Expenditure During Construction Period:
Incidental Expenditure incurred on projects/assets during
construction/implementation is capitalised and apportioned to
projects/assets on commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to Statement of Profit & Loss, except premium on
redemption of debentures [net of tax impact], which is adjusted against
the Securities Premium Reserve.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount and an impairment loss is charged to the Statement
of Profit & Loss in the year in which an asset is identified as
impaired. The recoverable amount is measured as the higher of the net
selling price or the value in use determined by the present value of
estimated future cash flows. The impairment loss recognised in prior
accounting period is reversed if there has been a change in the
estimate of the recoverable amount.
Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes unless the possibility of an outflow of resources embodying
economic benefits is remote. Contingent Assets are neither recognised
nor disclosed in the financial statements. The Provisions, Contingent
Liabilities and Contingent Assets are reviewed at each Balance Sheet
date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/ payable on Redemption of Debentures, net of tax impact,
is adjusted against the Securities Premium Reserve.
Cash and Cash Equivalents
Cash and Cash Equivalents comprises cash on hand, demand deposits with
banks and other short term highly liquid investments that are readily
convertible into known amounts of cash and which are subject to
insignificant risk of changes in value.
Cash Flow Statements
Cash Flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated with
investing or financing cash flows. The cash flows from operating,
investing and financing activities of the Company are segregated.
Mar 31, 2014
General:
[i] The Accounts are prepared on the historical cost basis [except for
certain assets which are revalued] comprising of mandatory Accounting
Standard notified in Section 211 (3C) and other provisions of the
Companies Act, 1956 to the extent applicable and the Companies Act 2013
(to the extent notified & applicable).
[ii] The Accounts are prepared on the principles of a going concern.
[iii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue is recognised when it can be reliably measured and it is
reasonable to expect ultimate collection.
[ii] Revenue from Sale of Goods transactions (excluding transactions
for which Revenue recognition policy is specifically mentioned below)
is recognised when significant risks and rewards of ownership have been
transferred to the buyer and no significant uncertainty exists
regarding amount of consideration. Cement Sales / Clinker Sales/ Others
are net of Excise Duty/ Value Added Tax and exclusive of Self
Consumption.
[iii] Revenue from Sale of service transactions are recognised when no
significant uncertainty exists regarding the amount of consideration
that will be derived from rendering the service.
[iv] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[v] Escalations/Claims are taken in the Accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
of receipt.
[vi] Revenue from Real Estate Development of constructed properties is
recognised based on the "Percentage of completion method". Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease,
all significant risks and rewards are transferred to the customer and
possession is handed over.
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "Percentage of completion method" when a firm agreement
has been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
The revenue in respect of projects undertaken on or after 1st April,
2012 or where the revenue is being recognised for the first time after
1st April, 2012 is recognised in accordance with the Guidance Note on
Accounting for Real Estate Transactions [Revised 2012] issued by
Institute of Chartered Accountants of India.
[vii] (a) The costs that are incurred before a construction contract is
secured are treated as expenses for the year in which these are
incurred and charged to revenue.
(b) The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifiable to a specified contract are charged to the
general revenue in the year in which such costs are incurred.
[viii] Dividend Income is recognized when right to receive payment is
established.
[ix] Interest is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
[x] Royalties are accounted on accrual basis in accordance with the
terms of the relevant agreement.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/materialised.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation and net
of recoverable taxes. Major Expenditure in Hotel properties involving
relocation and redesigning of various outlets, guest floors and
additions thereto, enhancement in the value of assets and revenue
generating capacity is capitalised. Foreign Exchange Rate Difference on
long term monetary items arising on settlement or at reporting dates
attributable to Fixed Assets is capitalised/adjusted in the carrying
value of the Fixed Assets.
Depreciation:
[i] Depreciation on Fixed Assets is provided on Straight Line Method as
per the classification and in the manner specified in Schedule-XIV to
the Companies Act, 1956.
[ii] Computer Softwares is amortized over a period of five years.
[iii] Premium on Lease-hold Land [except in case of perpetual lease] is
amortised over the period of lease.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or
quoted/ fair value, computed categorywise.
Employee Benefits:
Employee Benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Plan and is accounted on accrual
basis.
[ii] Gratuity and Leave Encashment is a Defined Benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year. The actuarial valuation is done as per
Projected Unit Credit method.
Inventories :
[i] Inventories are valued at Cost or Net Realisable Value whichever is
lower. Cost of Inventories comprises of cost of purchase, cost of
conversion and other costs incurred in bringing the inventories to
their present location and condition. Cost of Raw Materials,
Construction Materials, Stores & Spares, Packing Materials, Stock of
Food & Beverages, Operating Stores and supplies is determined on
Weighted Average basis.
[ii] Work-in-Progress/Stock-in-Process are valued at cost. In case of
Item Rate Contract work in progress is measured on the basis of
physical measurement of work actually completed as at the balance sheet
date. In case of cost plus contracts work in progress is taken as cost
not billed on the contractee.
[iii] Stock of Finished Goods lying in the factory premises includes
excise duty, pursuant to accounting standard [AS-2] [Revised].
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
related costs.
Foreign Currency Transactions:
[i] Transactions denominated in Foreign Currency are recorded in the
Books of Account in Indian Rupees at the rate of exchange prevailing on
the date of transaction.
[ii] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
The exchange difference arising either on settlement or at reporting
date is recognised in the Statement of Profit & Loss except in cases
where they relate to acquisition of fixed assets, in which case they
are adjusted to the carrying cost of such assets.
[iii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Statement of Profit & Loss except in cases where
they relate to acquisition of fixed assets, in which case they are
adjusted to the carrying cost of such assets. Premium paid in respect
of Hedge Contracts are recognised in the Statement of Profit & Loss,
except in case where they relate to the acquisition or construction of
fixed assets, in which case, they are adjusted to the carrying cost of
such assets.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not
use derivative financial instrument for speculative purposes.
[v] Non Monetary foreign currency items are carried at cost.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets and
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Statement of Profit
& Loss.
Research and Development:
Revenue expenditure on Research and Development is charged to Statement
of Profit & Loss in the year in which it is incurred. Capital
expenditure on Research and Development is shown as an addition to
Fixed Assets.
Miscellaneous Expenditure:
Share/Debenture Issue Expenses are adjusted against Security Premium
Reserve in the year in which they are incurred.
Incidental Expenditure During Construction Period:
Incidental Expenditure incurred on projects/assets during
construction/implementation is capitalised and apportioned to
projects/assets on commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to Statement of Profit & Loss.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount and an impairment loss is charged to the Statement
of Profit & Loss. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows. The impairment loss recognised in
prior accounting period is reversed if there has been a change in the
estimate of the recoverable amount.
Provisions, Contingent Liabilities and Contingent Assets :
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes unless the possibility of an outflow of resources embodying
economic benefits is remote. Contingent Assets are neither recognised
nor disclosed in the financial statements. The Provisions, Contingent
Liabilities and Contingent Assets are reviewed at each Balance Sheet
date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/ payable on Redemption of Debentures, net of tax impact,
is adjusted against the Securities Premium Reserve.
2.1 Issued, Subscribed and Paid-up Share Capital in number comprises of
Shares for consideration in cash 20,219,850 Equity Shares [Previous
Year 2,02,19,850] allotted under "Jaypee Employees Stock Purchase
Scheme 2002";
12,500,000 Equity Shares [Previous Year 1,25,00,000] allotted under
"Jaypee Employees Stock Purchase Scheme 2009";
201,623,717 Equity Shares [Previous Year 20,16,23,717] allotted for
cash on conversion of Foreign Currency Convertible Bonds; 10,000,000
Equity Shares [Previous Year 1,00,00,000] allotted for cash to
Promoters on Preferential Basis and 64,204,810 Equity Shares [Previous
Year 6,42,04,810] allotted through Qualified Institutional Placement as
on 06.02.2013.
Shares for consideration other than cash 860,865,055 Equity Shares
[Previous Year 86,08,65,055] allotted in terms of the Scheme of
Amalgamation effective from 11.03.2004;
124,378,825 Equity Shares [Previous Year 12,43,78,825] allotted in
terms of Scheme of Amalgamation effective from 22.08.2006;
218,010,985 Equity Shares [Previous Year 21,80,10,985] allotted
pursuant to Scheme of Amalgamation effective from 27.05.2009 and
707,280,317 Equity Shares [Previous Year 70,72,80,317] allotted as
Bonus Shares .
2.3 Terms / Rights
The Company has issued only one class of equity shares having a par
value of Rs. 2/- per share. Each holder of equity share is entitled to
one vote per share. Each share is entitled to equal dividend declared
by the Company and approved by the Share holders of the Company.
In the event of liquidation, each share carries equal rights and will
be entitled to receive equal amount per share out of the remaining
amount available with the Company after making preferential payments.
[b] Term Loans of Rs. 1232500 Lakhs [Amount outstanding Rs. 1056915 Lakhs]
sanctioned by Financial Institutions, Banks together will all interest,
liquated damages, premia on pre-payment or on redemption, costs,
expenses and other monies, stipulated in the Loan Agreements are
secured by First Charge ranking pari pasu with all the lenders save and
except AKA Export Finance Bank [Amount outstanding as at 31.03.2014 - Rs.
3681 Lakhs] and LIC of India [Amount outstanding as on 31.03.2014 - Rs.
346 Lakhs] who are having prior charge on specific Fixed Assets, in
favour of Axis Trustee Services Limited [Security Trustee], holding
security for the benefit of all lenders on all the movable and
immovable fixed assets of the Company except Fixed Assets pertaining to
Wind Power Division, Real Estate Division, Fixed Assets specifically
charged to State Government / State Financial Insitutions for availing
interest free loans etc., under various schemes framed by State
Governments and any other assets specifically charged. Term Loan of Rs.
40000 Lakhs sanctioned by IFCI Ltd., is further secured by way of
Exclusive Charge over 5.48 acres of Commercial Land situated at Jaypee
Sports City near F1 Stadium, SDZ, Sector 25, Gautam Budh Nagar, Uttar
Pradesh. The Company has entered into an "Agreement to Sell" with
Jaypee Sports International Ltd., on 29.03.2014 for purchase of 33.48
acres of Land and the said land is yet to be transferred/sub-lease in
the name of the Company [Security is yet to created]. Term Loan of Rs.
150000 Lakhs sanctioned by ICICI Bank Ltd., is further secured by way
of (i) exclusive charge on all immovable properties admeasuring 100
acres of Land at Jaypee Infratech Ltd., situated at Village - Tappal,
Tehsil - Khair, Distt. - Aligarh, Uttar Pradesh together with all
buildings and structures thereto and all Plant & Machinery attached to
the earth or permanently fastened to anything attached to the earth,
both present and future (ii) pledge over 18,93,16,882 equity shares of
the Company held in various Trusts on first pari passu charge on basis
with RTL of Rs. 130000 Lakhs sanctioned by ICICI Bank Ltd. Term Loan of Rs.
75000 Lakhs sanctioned by State Bank of India is further secured by way
of [i] exclusive charge over 22.2078 acres of Commercial Land situated
at Jaypee Sports City near F1 Stadium, SDZ, Sector 25, Gautam Budh
Nagar, Uttar Pradesh. [ii] pledge of 10 crores equtiy shares of Jaypee
Infratech Ltd., held by Jaiprakash Associates Ltd. (iii) second pari
passu charge on current assets of the Company.
[c] Term Loans of Rs. 21300 Lakhs (Amount outstanding - Rs. 21300 Lakhs)
sanctioned by Export Import Bank of India are secured by First Charge
ranking pari passu with all the lenders save and except AKA Export
Finance Bank [Amount Outstanding as at 31.03.2014 - Rs. 3681 Lakhs] and
LIC of India [Amount Outstanding as at 31.03.2014- Rs. 346 Lakhs] who are
having prior charge on specific Fixed Assets, in favour of Axis Trustee
Services Limited [Security Trustee], holding security for the benefit
of all lenders, on all the Movable Fixed Assets of the Company except
Fixed Assets pertaining to Wind Power Division, Real Estate Division,
Fixed Assets specifically charged to State Government / State Financial
Insitutions for availing interest free loans etc., under various
schemes framed by State Governments and any other assets specifically.
[d] Term Loans sanctioned by ICICI Bank - Rs. 130000 Lakhs, Canara Bank -
Rs. 20000 Lakhs, L & T Infrastructure Finance Co. Ltd. - Rs. 10000 Lakhs,
Syndicate Bank - Rs. 10000 Lakhs and Bank of Maharastra - Rs. 30000 Lakhs,
Canara Bank - Rs. 50000 Lakhs, Yes Bank Ltd. - Rs. 20000 Lakhs, aggregating
to Rs. 270000 Lakhs [ Amount outstanding Rs. 243699 Lakhs] together with
all interest, liquidated damages, premia on prepayment or on
redemption, costs, expenses and other monies, stipulated in the Loan
Agreements are secured by way of Subservient charge on all the fixed
Assets of the company except the fixed assets pertaining to Wind Power
Division, Real Estate Division and Fixed assets specifically charged to
State Government /State Financial Institutions for availing interest
free loans etc. under various schemes framed by State Governments. (1)
Term loan of Rs. 130000 Lakhs sanctioned by ICICI Bank is further secured
by way of (i) pledge of 18,93,16,882 Equity shares of the Company held
through various trusts whose beneficiary is the Company, (ii) pledge of
7,50,000 - 11% Cumulative Preference Shares of Himalyan Expressway
Limited and (iii) pledge of 1,02,12,000 12% Preference Shares of Jaypee
Agra Vikas Ltd., owned by the Company. (2) Term Loan of Rs. 50000 Lakhs
sanctioned by Canara Bank is further secured by way of Exclusive Charge
over 25.007 acres of Commercial Land situated at Jaypee Sports City
near F1 Stadium, SDZ Sector-25, Gautam Budh Nagar, Uttar Pradesh. (3)
Term Loan of Rs. 20000 Lakhs sanctioned by Yes Bank Ltd. is further
secured by way of exclusive charge over 11.3095 acres of Commercial
Land situated at Jaypee Sports City near F1 Stadium, SDZ Sector-25,
Gautam Budh Nagar, Uttar Pradesh.
[e] Term Loans sanctioned by SREI - Rs. 16500 Lakhs [Amount outstanding Rs.
2063 Lakhs] together with all interest, liquidated damages, premia on
prepayment or on redemption, costs, expenses and other monies,
stipulated in the Loan Agreements secured by way of Subservient charge
on moveable Fixed Assets of Engineering Division of the Company..
[f] Term Loans sanctioned by SREI - Rs. 9500 Lakhs [Amount outstanding Rs.
6530 Lakhs] together with all interest, liquidated damages, premia on
prepayment or on redemption, costs, expenses and other monies,
stipulated in the Loan Agreements secured by way of exclusive charge on
specific moveable Fixed Assets at Amelia Coal Block..
[g] Term Loans sanctioned by Axis Bank Ltd. Rs. 35000 Lakhs, The South
Indian Bank Rs. 10000 Lakhs and State Bank of Travancore Rs. 15000 Lakhs
aggregating of Rs. 60000 Lakhs [Amount outstanding Rs. 60000 Lakhs]
together with all interest, liquidated damages, premia on prepayment or
on redemption, costs, expenses and other monies, stipulated in the Loan
Agreements secured by way of First Charge ranking Pari Passu basis on
17.52 acres of Hotel & Commercial Land purchased from Jaypee Infratech
Ltd. in Village - Wazidpur, Sector -129, Noida. Entire Sale
consideration has been paid by the Company to Jaypee Infratech Limited
and (ii) First Charge ranking Pari Passu on 10 acres of Commercial Land
of Jaypee Infratech Ltd. situated at Sector - 128, Noida.
[h] External Commercial Borrowing of USD 27 Million and Yen 1030.27
Million availed [Amount outstanding USD 9.524 Million and Yen 408.837
Million] from ICICI Bank Ltd for setting up of Wind Power Project in
Maharashtra & Gujarat together with all interest, liquidated damages,
premia on prepayment or on redemption, costs, expenses and other
monies, stipulated in the Loan Agreements, is secured by equitable
mortgage of immovable properties and Hypothecation of movable assets of
Wind Power Project [present and future], save and except book debts
subject to prior charge on specified movables created in favour of the
Company''s Bankers for working Capital facilities.
[i] Term Loans sanctioned by Standard Chartered Bank Rs. 40000 Lakhs and
Rs. 45000 Lakhs [Amount outstanding Rs. 78340 Lakhs] are secured against
first charge ranking pari passu by way of equitable mortgage by deposit
of title deed over the land admeasuring 356.56 acres at Jaypee Greens
Golf Course, Greater Noida, Uttar Pradesh and collaterally secured by
first charge ranking pari passu by way of Registered mortgage over land
of Jaypee Infratech Ltd. admeasuring 40.1735 acres (residential 25.0040
acres and commercial 15.1695 acres) situated at village Sultanpur,
Noida, Uttar Pradesh and Village Wazidpur, Noida, Uttar Pradesh. Out of
the said 40.1735 acres of land, the Company has entered into an
"Agreement to Sell" with Jaypee Infratech Limited on 15.12.2009 for
purchase of 15.1695 acres of commercial land and entire sale
consideration has been paid to Jaypee Infratech Limited.
[j] Term Loan sanctioned by HDFC Limited Rs. 45000 Lakhs [Amount
outstanding Rs. 39447 Lakhs] is secured against first & exclusive charge
by way of Registered Mortgage over (a) Leasehold property admeasuring
project land of 14.20 acres at Jaypee Greens which is part and parcel
of 452.26 acres of the integrated Township Jaypee Greens Greater Noida,
U.P. alongwith construction thereon both present and future (b)
Leasehold property admeasuring 38.20 acres at Noida, U.P. designated
for the construction of Kalyspo Court 1-10 (B-1), Kalyspo Court
11,12,14,15,16 (B-3), imperial Court 1-3 (B-2) Pelican (PD-1 & PD-2) in
the integrated Township in the name and style of Wish Town, Noida, U.P.
The said land is registered in the name of Jaypee Infratech Limited and
entire sale consideration has been paid by the Company to Jaypee
Infratech Limited. and (c) First Charge on Project Land/FSI of
11,01,954 Sq. feet of B 10, Suncourt A & Town Centre Residential in
Jaypee Greens, Greater Noida with construction thereon, present and
future.
[k] Term Loan sanctioned by Standard Chartered Bank - Rs. 35000 Lakhs,
Allahabad Bank - Rs. 10000 Lakhs, Karur Vysya Bank - Rs. 5000 Lakhs, The
South Indian Bank - Rs. 10000 Lakhs and United Bank of India - Rs. 15000
Lakhs aggregatting to Rs. 75000 Lakhs [Amount Outstanding - Rs. 75000
Lakhs] are secured by way of exclusive First Charge on pari- passu
basis over 65.0263 Acres of Commercial Land situated at Jaypee Sports
City near F1 Stadium, SDZ Sector-25, Gautam Budh Nagar, U.P.
[l] Term Loan sanctioned by Yes Bank Ltd. - Rs. 52500 Lakhs [Amount
Outstanding - Rs. 52500 Lakhs] is secured by way of exclusive charge over
28 acres of Commercial Land situated at Jaypee Sports City near F1
Stadium, SDZ Sector-25, Gautam Budh Nagar, Uttar Pradesh. The Company
has entered into an "Agreement to Sell" with Jaypee Sports
International Ltd. on 29.03.2014 for purchase of 33.48 acres of Land
and the said land is yet to be transferred/sub-lease in the name of the
Company.
[m] Security includes security created / yet to be created.
4.3 Loans from State Government :
[i] Interest Free Loans granted by U.P.Financial Corporation (UPFC)
under Audyogik Nivesh Protshahan Yojna Scheme at Grinding Unit in Tanda
(U.P.) are secured by way of First Charge on the Fixed Assets of the
respective Unit of the Company. The same is repayable on or before
completion of 10 years from the day on which it is received. Repayment
will commence from F.Y. 2016-17.
[ii] Interest free loan granted by DIC, Panipat, Haryana at Grinding
Unit in Panipat (Haryana) is secured against Bank Guarantee. The same
is repayable on or before completion of 5 years from the day on which
it is received. Repayment will commence from F.Y. 2014-15.
[iii] Interest Free Loans granted by Pradeshiya Industrial & Investment
Corporation Limited at Grinding Unit in Sikandrabad (U.P.) is secured
against Bank Guarantee. The same is repayable on or before completion
of 10 years from the day on which it is received. Repayment will
commence from F.Y. 2022-23.
4.4 Advances from Clients includes loan granted by Client for purchase
of Plant & Machinery for the Contract on Hypothecation of Construction
Material and Plant & Equipment.
4.5 Details of Foreign Currency Convertible Bonds (Unsecured) at Note
No.4[II]A are given as under :
[a] The Company has issued 1,50,000, 5.75% Foreign Currency Convertible
Bonds [FCCB-2012] of USD 1,000 each aggregating to USD 150 Million at
par on 07.09.2012. These Bonds are convertible at the option of
bond-holders into equity shares of Rs. 2/- each fully paid at the
conversion price of Rs. 77.50 per share, subject to the terms of issue,
with a fixed rate of exchange of Rs. 55.67 equal to USD 1.00 at any time
on or after 18.10.2012 and prior to the close of business on
01.09.2017.
No conversion has taken place during F.Y. 2013-14 [Previous Year 39,600
FCCBs of USD 1,000 each aggregating to USD 39.60 Million were converted
into 2,84,45,567 Equity Shares of Rs. 2/- each]. Unless previously
converted, the bonds are redeemable at maturity on 08.09.2017.
4.6.2 Jaypee Infratech Limited [subsidiary company] has provided a
letter of Comfort to ICICI Bank UK Plc [at Sl. No 2 above] and ICICI
Bank Canada [at Sl. No 3 above] for the financial assistance of GBP
34.84 Million [equivalent to USD 50 Million] and CAD 61.625 Million
[equivalent to USD 50 Million] respectively.
4.6.3 External Commercial Borrowing from State Bank of India, Hongkong
Branch [at Sl. No 4 above] has been secured by way of Corporate
Guarantee by Jaiprakash Power Ventures Ltd. [JPVL], a subsidiary
Company.
4.7 Unsecured Loan taken from Banks at Note No.4[II]C is Loan taken
from SIDBI in foreign currency [Amount Outstanding Rs. 19932 Lakhs
(Previous Year Rs. 21295 Lakhs)] repayable in 14 equal half yearly
installments from 30.06.12 to 30.12.18.
4.8 The Company accepts Fixed Deposit under Fixed Deposits Scheme from
Public which are repayable in one year, two years and three years.
8.1 Secured Term Loans from Banks :
(i) Short Term Loan of Rs. 125000 Lakhs [Amount Outstanding Rs. 124000
Lakhs] sanctioned from Axis Bank Limited is secured by way of (i)
pledge of 18,82,48,200 Equity Shares and 3,00,00,000 Preference Shares
of Jaypee Cement Corporation Ltd. [JCCL] held by the Company, (ii) Non
Disposal Undertaking for 43,92,45,800 Equity Shares and 7,00,00,000
Preference Shares of JCCL held by the Company, (iii) exclusive charge
over A-2 Building [5 Star Resort cum SPA] admeasuring 30813.0 Sq.
Meters [7.603 Acres] land along with building constructed thereon and
other assets such as furniture and fixtures, equipments, machinery -
fixed and movable, structures and any other assets situated at Jaypee
Greens, Greater Noida, (iv) subservient charge on all movable Fixed
Assets and Current Assets of the Company and (v) hypothecation of
Receivable from JCCL to the extent of Rs. 1513.28 Crores.
(ii) Working Capital Demand Loan of Rs. 10000 Lakhs availed from Axis
Bank Limited secured by way of Subservient and Subsequent Charge over
the Current Assets of the Company.
(iii) Short Term Loan of Rs. 100 Lakhs [Previous Year Rs. 200 Lakhs]
availed from Union Bank of India is secured against Fixed Deposits with
the Bank.
(iv) Short Term Loan of Rs. 50 Lakhs [Previous Year Rs. 200 Lakhs] availed
from Oriental Bank of Commerce is secured against Fixed Deposits with
the Bank.
(v) Short Term Loan of Rs. 500 Lakhs availed from State Bank of India is
secured against Fixed Deposits with the Bank.
(vi) Short Term Loan of Rs. 20000 Lakhs [Amount Outstanding Rs. 20000
Lakhs] availed from Yes Bank Ltd. is secured by way of subservient
charge on all fixed assets of the company except the fixed assets
pertaining to Wind Power, Real Estate Division and fixed assets
specifically charged to State Govt./State Financial Institutions for
availing incentive/interest free loans etc. and Non Disposal
Undertaking in respect of 9,89,01,000 Equity Shares of Rs. 10/- each of
Bokaro Jaypee Cement Limited held by the Company.
8.2 Working Capital Loans:
(i) The Working Capital facilities [Fund based - Rs. 500 Crores. and Non
Fund based - Rs. 4265 Crores.] sanctioned by the Consortium of 19 member
Banks with Canara Bank, as Lead, are secured by way of first charge
ranking pari passu on Current Assets of the Company i.e. Hypothecation
of Stocks of Raw Materials, Work-in-Progress, Stock- in-Process,
Finished Goods, Stores & Spares and Book Debts and second charge
ranking pari passu on the Fixed Assets of the Company [except Fixed
Assets pertaining to Wind Power Division, Real Estate Division and
Fixed assets specifically charged to State Government /State Financial
Institutions for availing interest free loans etc.] and other assets
specifically charged on specific loans. Further Jammu and Kashmir Bank
Ltd. and IDBI Bank Ltd. have converted their Non Fund Based Limits
[within Consortium] into Fund Based Limits to the extent of Rs. 10000
Lakhs [Amount Outstanding Rs. 10000 Lakhs] and Rs. 5000 Lakhs [Amount
Outstanding Rs. 5000 Lakhs] respectively.
(ii) Overdraft Facility from ICICI Bank Ltd., of Rs. 17500 Lakhs [Amount
outstanding Rs. 16975 Lakhs] carved-out from existing Non Fund based
working capital facility sanctioned under consortium is further secured
by way of Extention of Mortgage on all Immovable Properties admeasuring
100 Acres of Land of Jaypee Infratech Ltd. situated at Village -
Tappal, Tehsil - Khair, Distt.- Aligarh, Uttar Pradesh together with
all buildings and structures thereto and all plant and machinery
attached to the earth or permanently fastened to anything attached to
the earth, both present and future.
NOTE No. "13.2"
The Trusts are holding shares of 18,93,16,882 Equity Shares [Previous
Year 18,93,16,882] of Rs. 2/- of Jaiprakash Associates Limited, the sole
beneficiary of which is the Company. [The Market Value of Shares held
in Trusts is Rs. 1,01,663 Lakhs (Previous Year Rs. 1,23,908 Lakhs)]
NOTE No. "13.3"
All Investments are Non-trade Investments.
NOTE No. "13.4"
Since the Market Rate of Saket Project Limited was not available in any
of the Stock Exchanges, Market Value has been considered equivalent to
Face Value.
"20.1" Term Deposits with Original Maturity less than three months
includes Rs. 94 Lakhs [Previous Year Rs. 17 Lakhs] pledged as Guarantees /
Margin Money with Banks and Others.
"20.2"Term Deposits with Maturity less than twelve months includes Rs.
14387 Lakhs [Previous Year Rs. 1359 Lakhs] pledged as Guarantees / Margin
Money [including Rs. 345 Lakhs (Previous Year Rs. 274 Lakhs) pledged as
Performance Guarantees] with Banks and Others.
"20.3" Balances with Banks in Current Account in Foreign Currency
includes Iraqi Dinars 27,377 Million equivalent to Rs. 10 Lakhs which are
not available for use by the Company.
"20.4" Term Deposits with Maturity less than twelve months includes Rs.
16000 Lakhs [Previous Year Rs. 19100 Lakhs] earmarked for repayment of
Public Deposits & Non - Convertible Debentures..
Mar 31, 2013
General:
[i] The Accounts are prepared on the historical cost basis and on the
principles of a going concern.
[ii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue/Income and Cost/Expenditure are accounted for on accrual
basis.
[ii] Cement Sales/Clinker Sales: Sales are net of Excise Duty/Value
Added Tax and exclusive of Self Consumption.
[iii] Construction Revenue/Income from/in respect of Contracts entered
on or after 01.04.2003 are accounted as per AS-7 [Revised].
Construction Revenue/Income from/in respect of Contracts entered before
01.04.2003 are accounted as per erstwhile AS-7.
[iv] Entrance Fee for Golf Membership is recognised in the year of
receipt, irrespective of the period of membership.
[v] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[vi] Escalations/Claims are taken in the accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
of receipt.
[vii] Revenue from Real Estate Development of constructed properties is
recognised based on the "Percentage of completion method". Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease;
all significant risks and rewards are transferred to the customer and
possession is handed over.
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "Percentage of completion method" when a firm agreement
has been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
The revenue in respect of projects undertaken on or after 1st April,
2012 or where the revenue is being recognised for the first time after
1st April, 2012 is recognised in accordance with the Guidance Note on
Accounting for Real Estate Transactions [Revised 2012] issued by
Institute of Chartered Accountants of India.
[viii] (a) The costs that are incurred before a construction contract
is secured are treated as expenses for the year in which these are
incurred and charged to revenue.
(b) The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifiable to a specified contract are charged to the
general revenue in the year in which such costs are incurred.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/materialise.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation. Major
Expenditure in Hotel properties involving relocation and redesigning of
various outlets, guest floors and additions thereto, enhancement in the
value of assets and revenue generating capacity is capitalised.
Depreciation:
Depreciation on Fixed Assets is provided on Straight Line Method as per
the classification and in the manner specified in Schedule-XIV to the
Companies Act, 1956.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or
quoted/ fair value, computed categorywise. Dividend is accounted for as
and when received.
Employee Benefits:
Employee Benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Scheme.
[ii] Gratuity and Leave Encashment is a Defined Benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year.
Inventories :
[i] Stock of Cement is valued at estimated cost or net realisable
value, whichever is less. Value of Cement and Clinker lying in the
factory premises includes excise duty, pursuant to the Accounting
Standard (AS-2) [Revised].
[ii] The Closing stocks of Stores & Spares, Construction Materials, Raw
Materials are valued on the basis of Weighted Average Cost Method.
Material/Goods in Transit is taken at cost.
[iii] Work-in-Progress/Material-in-Process are valued at estimated
cost.
[iv] Hotel Business - Stock of Food, Beverages, operating Stores and
Supplies are valued at cost. Consumption of material is valued at Cost.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
related costs.
Foreign Currency Transactions:
[i] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
[ii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Statement of Profit & Loss except in cases where
they relate to acquisition of fixed assets, in which case they are
adjusted to the carrying cost of such assets.
[iii] Transactions in Foreign Currency are recorded in the Books of
Account in Indian Rupees at the rate of exchange prevailing on the date
of transaction.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not use
derivative financial instrument for speculative purposes.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets or
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Statement of Profit
& Loss.
Research and Development:
Revenue expenditure on Research and Development is charged to Statement
of Profit & Loss in the year in which it is incurred. Capital
expenditure on Research and Development is shown as an addition to
Fixed Assets.
Miscellaneous Expenditure:
[i] Preliminary and Share Issue Expenses are written-off in the year in
which they are incurred.
[ii] Hotel Business - Miscellaneous Expenditure is stated at cost less
accumulated amortisation. Fees paid to the Franchiser is amortised over
a period of five years.
Incidental Expenditure During Construction Period:
Incidental Expenditure incurred on projects/ assets during
construction/implementation is capitalised and apportioned to
projects/assets on commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to revenue.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows.
Provisions, Contingent Liabilities and Contingent Assets [AS - 29]:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes. Contingent Assets are neither recognised nor disclosed in the
financial statements. The Provisions, Contingent Liabilities and
Contingent Assets are reviewed at each Balance Sheet date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/payable on Redemption of Debentures, net of tax impact, is
adjusted against the Securities Premium Reserve.
Mar 31, 2012
[A] SIGNIFICANT ACCOUNTING POLICIES
General:
[i] The Accounts are prepared on the historical cost basis and on the
principles of a going concern.
[ii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue/Income and Cost/Expenditure are accounted for on accrual
basis.
[ii] Cement Sales/ Clinker Sales/ Asbestos Sheets Sales are net of
Excise Duty/Value Added Tax and exclusive of Self Consumption.
[iii] Construction Revenue/Income from/in respect of Contracts entered
on or after 01.04.2003 are accounted as per AS-7 [Revised].
Construction Revenue/Income from/in respect of Contracts entered before
01.04.2003 are accounted as per erstwhile AS-7.
[iv] Entrance Fee for Golf Membership is recognised in the year of
receipt, irrespective of the period of membership.
[v] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[vi] Escalations/Claims are taken in the accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
of receipt.
[vii] Revenue from Real Estate Development of constructed properties is
recognised based on the "Percentage of completion method". Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease;
all significant risks and rewards are transferred to the customer and
possession is handed over.
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "Percentage of completion method" when a firm agreement
has been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
[viii] (a) The costs that are incurred before a construction contract
is secured are treated as expenses for the year in which these are
incurred and charged to revenue.
(b) The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifiable to a specified contract are charged to the
general revenue in the year in which such costs are incurred.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/ materialise.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation. Major
Expenditure in Hotel properties involving relocation and redesigning of
various outlets, guest floors and additions thereto, enhancement in the
value of assets and revenue generating capacity is capitalised.
Depreciation:
Depreciation on Fixed Assets is provided on Straight Line Method as per
the classification and in the manner specified in Schedule-XIV to the
Companies Act, 1956.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or quoted/
fair value, computed categorywise. Dividend is accounted for as and
when received.
Employee Benefits:
Employee Benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Scheme.
[ii] Gratuity and Leave Encashment is a Defined Benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year.
Inventories :
[i] Stock of Cement/ Asbestos Sheets is valued at estimated cost or net
realisable value, whichever is less. Value of Cement, Asbestos Sheets
and Clinker lying in the factory premises includes excise duty,
pursuant to the Accounting Standard (AS-2) [Revised].
[ii] The Closing stocks are valued on the basis of Weighted Average
Cost Method. Material at Transit is taken at cost.
[iii] Work-in-Progress/Material-in-Process are valued at estimated
cost.
[iv] Hotel Business - Stock of Food, Beverages, Operating Stores and
Supplies are valued at cost. Consumption of material is valued at Cost.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
related costs.
Foreign Currency Transactions:
[i] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
[ii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Statement of Profit & Loss except in cases where
they relate to acquisition of fixed assets, in which case they are
adjusted to the carrying cost of such assets.
[iii] Transactions in Foreign Currency are recorded in the Books of
Account in Indian Rupees at the rate of exchange prevailing on the date
of transaction.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not use
derivative financial instrument for speculative purposes.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets or
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Statement of Profit
& Loss .
Research and Development:
Revenue expenditure on Research and Development is charged to Statement
of Profit & Loss in the year in which it is incurred. Capital
expenditure on Research and Development is shown as an addition to
Fixed Assets.
Miscellaneous Expenditure:
[i] Preliminary and Share Issue Expenses are written-off in the year in
which they are incurred.
[ii] Hotel Business - Miscellaneous Expenditure is stated at cost less
accumulated amortisation. Fees paid to the Franchiser is amortised over
a period of five years.
Expenditure During Construction Period:
Expenditure incurred on projects/assets during construction
/implementation is capitalised and apportioned to projects/ assets on
commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
outstanding during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to revenue.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows.
Provisions, Contingent Liabilities and Contingent Assets [AS - 29]:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes. Contingent Assets are neither recognised nor disclosed in the
financial statements. The Provisions, Contingent Liabilities and
Contingent Assets are reviewed at each Balance Sheet date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/ payable on Redemption of Debentures, net of tax impact,
is adjusted against the Securities Premium Reserve.
Mar 31, 2011
General:
[i] The Accounts are prepared on the historical cost basis and on the
principles of a going concern.
[ii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue/Income and Cost/Expenditure are accounted for on accrual
basis.
[ii] Cement Sales/ Asbestos Sheets Sales are net of Excise Duty/Value
Added Tax and exclusive of Self Consumption.
[iii] Construction Revenue/Income from/in respect of Contracts entered
on or after 01.04.2003 are accounted as per AS-7 [Revised].
Construction Revenue/Income from/in respect of Contracts entered before
01.04.2003 are accounted as per erstwhile AS-7
[iv] Entrance Fee for Golf Membership is recognised in the year of
receipt, irrespective of the period of membership.
[v] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received
[vi] Escalations/Claims are taken in the accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
of receipt.
[vii] Revenue from Real Estate Development of constructed properties is
recognised based on the "Percentage of completion method". Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease;
all Significant risks and rewards are transferred to the customer and
possession is handed o ver ."
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "Percentage of completion method" when a firm agreement has
been entered into and 30 percent or more of the consideration is
received and where no Significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all Significant
risks and rewards are transferred to the customer.
[viii] [a] The costs that are incurred before a construction contract
is secured are treated as expenses for the year in which these are
incurred and charged to revenue.
[b] The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifable to a specified contract are charged to the general
revenue in the year in which such costs are incurred.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/materialise.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation. Major
Expenditure in Hotel properties involving relocation and redesigning of
various outlets, guest foors and additions thereto, enhancement in the
value of assets and revenue generating capacity is capitalised.
Depreciation:
Depreciation on Fixed Assets is provided on Straight Line Method as per
the classification and in the manner specified in Schedule-XIV to the
Companies Act, 1956.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or quoted/
fair value, computed categorywise. Dividend is accounted for as and
when received.
Employee benefits:
Employee benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a defined Contribution Scheme.
[ii] Gratuity and Leave Encashment is a defined benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year. The actuarial valuation is made on
Projected Unit Credit method.
Inventories :
[i] Stock of Cement/ Asbestos Sheets is valued at estimated cost or net
realisable value, whichever is less. Value of Cement, Asbestos Sheets
and Clinker lying in the factory premises includes excise duty,
pursuant to the Accounting Standard (AS-2) [Revised].
[ii] The Closing stocks are valued on the basis of Weighted Average
Cost Method. Material at Transit is taken at cost.
[iii] Work-in-Progress/Material-in-Process are valued at estimated
cost.
[iv] Hotel Business - Stock of Food, Beverages, operating Stores and
Supplies are valued at cost. Consumption of material is valued at Cost.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
related costs.
Foreign Currency Transactions:
[i] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
[ii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Profit & Loss Account except in cases where they
relate to acquisition of fixed assets, in which case they are adjusted
to the carrying cost of such assets.
[iii] Transactions in Foreign Currency are recorded in the Books of
Account in Indian Rupees at the rate of exchange prevailing on the date
of transaction.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not use
derivative financial instrument for speculative purposes.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets or
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Profit & Loss
Account.
Research and Development:
Revenue expenditure on Research and Development is charged to Profit &
Loss Account in the year in which it is incurred. Capital expenditure
on Research and Development is shown as an addition to Fixed Assets.
Miscellaneous Expenditure:
[i] Preliminary and Share Issue Expenses are written-off in the year in
which they are incurred.
[ii] Hotel Business - Miscellaneous Expenditure is stated at cost less
accumulated amortisation. Fees paid to the Franchiser is amortised over
a period of five years.
Expenditure During Construction Period:
Expenditure incurred on projects/assets during construction/
implementation is capitalised and apportioned to projects/assets on
commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net Profit after
tax by the weighted average number of equity shares outstanding during
the year. Diluted earnings per equity share is
computed by dividing adjusted net Profit after tax by the aggregate of
weighted average number of equity shares and dilutive potential equity
shares outstanding during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to revenue.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows.
Provisions, Contingent Liabilities and Contingent Assets [AS - 29]:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes. Contingent Assets are neither recognised nor disclosed in the
financial statements. The Provisions, Contingent Liabilities and
Contingent Assets are reviewed at each Balance Sheet date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/ payable on Redemption of Debentures, net of tax impact,
are adjusted against the Securities Premium Account.
Mar 31, 2010
General:
[i] The accounts are prepared on the historical cost basis and on the
principles of a going concern.
[ii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
Revenue Recognition:
[i] Revenue/Incomes and Costs/Expenditures are accounted for on accrual
basis.
[ii] Cement Sales/ Asbestos Sheets Sales are net of Excise Duty/Valued
Added Tax and exclusive of Self Consumption.
[iii] Construction Revenue/Incomes from/in respect of Contracts entered
on or after 01.04.2003 are accounted as per AS-7 [Revised].
Construction Revenue/Incomes from/in respect of Contracts entered
before 01.04.2003 are accounted as per erstwhile AS-7.
[iv] Entrance Fee for Golf Membership is recognised in the year of
receipt, irrespective of the period of membership.
[v] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[vi] Escalations/Claims are taken in the accounts on the basis of
receipts or as acknowledged by the clients depending upon the certainty
of receipt.
[vii] Revenue from real estate development of constructed properties is
recognised based on the Ãpercentage of completion methodÃ. Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub- lease;
all significant risks and rewards are transferred to the customer and
possession is handed over.Ã
Revenue from sale / sub-lease of developed land / plot is recognised
based on the "percentage of completion method"when a firm agreement has
been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
[viii] [a] The costs that are incurred before a construction contract
is secured are treated as expenses for the year in which these are
incurred and charged to revenue. [b] The costs attributable to
contracts are normally identified to respective contracts. However, the
costs which cannot be identified/identifiable to a specified contract
are charged to the general revenue in the year in which such costs are
incurred.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/materialise.
Fixed Assets:
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation. Major
Expenditure in Hotel properties involving relocation and redesigning of
various outlets, guest floors and additions thereto, enhancement in the
value of assets and revenue generating capacity is capitalised.
Depreciation:
Depreciation on Fixed Assets is provided on Straight Line Method as per
the classification and in the manner specified in Schedule-XIV to the
Companies Act, 1956.
Investments:
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or quoted/
fair value, computed categorywise. Dividend is accounted for as and
when received.
Employee Benefits:
Employee Benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Scheme.
[ii] Gratuity and Leave Encashment is a defined benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year. The actuarial valuation is made on
Projected Unit Credit method.
Inventories :
[i] Stock of Cement/ Asbestos Sheets is valued at estimated cost or net
realisable value, whichever is less. Value of Cement, Asbestos Sheets
and Clinker lying in the factory premises includes excise duty,
pursuant to the Accounting Standard (AS-2) [Revised].
[ii] The closing stocks are valued on the basis of Weighted Average
Cost Method.
[iii] Work-in-Progress/Material-in-Process are valued at estimated
cost.
[iv] Hotel Business - Stock of Food, Beverages, operating Stores and
Supplies are valued at cost. Consumption of material is valued at Cost.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services etc.
Foreign Currency Transactions:
[i] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
[ii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Profit & Loss Account except in cases where they
relate to acquisition of fixed assets, in which case they are adjusted
to the carrying cost of such assets.
[iii] Transactions in Foreign Currency are recorded in the Books of
Account in Indian Rupees at the rate of exchange prevailing on the date
of transaction.
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not use
derivative financial instrument for speculative purposes.
Lease Rentals:
[i] Operating Leases: Rentals are expensed with reference to lease
terms.
[ii] Finance Leases: The lower of the fair value of the assets or
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Profit & Loss
Account.
Research and Development:
Revenue expenditure on Research and Development is charged to Profit &
Loss Account in the year in which it is incurred. Capital expenditure
on Research and Development is shown as an addition to Fixed Assets.
Miscellaneous Expenditure:
[i] Preliminary and Share Issue Expenses are amortised over a period of
ten years.
[ii] Miscellaneous Expenditure incurred on or after 1st April, 2003 is
written-off in the year in which it is incurred in terms of Accounting
Standard [AS-26].
[iii] Hotel Business - Miscellaneous Expenditure is stated at cost less
accumulated amortisation. Fees paid to the Franchiser is amortised over
a period of five years.
Expenditure During Construction Period:
Expenditure incurred on projects/assets during construction/
implementation is capitalised and apportioned to projects/assets on
commissioning.
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
outstanding during the year.
Borrowing Costs:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to revenue.
Segment Reporting:
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under "Unallocated".
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Date.
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows.
Provisions, Contingent Liabilities and Contingent Assets [AS - 29]:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes. Contingent Assets are neither recognised nor disclosed in the
financial statements. The Provisions, Contingent Liabilities and
Contingent Assets are reviewed at each Balance Sheet date.
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Jaiprakash Associates Ltd. குறித்த கூடுதல் தகவல்களை
-
Jaiprakash Associates Ltd. டூல்ஸ்
- பல்க் டீல்ஸ்
- பிளாக் டீல்ஸ்
-
Jaiprakash Associates Ltd. நிறுவன தகவல்கள்
- நிறுவன சுயவிவரம்
- நிறுவன வரலாறு
- நிர்வாக குழு
- மூலதன வடிவம்
- புராடெக்ட் மிக்ஸ்
- வங்கியாளர்/தணிக்கையாளர்/பதிவாளர்
-
நிறுவன வரலாறு
- போனஸ்
- மும்பை பங்குச் சந்தையில் விலை வரலாறு
- என்எஸ்இ விலை வரலாறு
-
Jaiprakash Associates Ltd. முக்கிய நிதியில் விகிதங்கள்
- விகிதங்கள்
-
Jaiprakash Associates Ltd. முடிவுகள்
- காலாண்டு முடிவுகள்
- அரையாண்டு முடிவுகள்
- 9 மாத முடிவுகள்
- வருடாந்திர முடிவுகள்
-
Jaiprakash Associates Ltd. நிதியியல் தகவல்கள்
- தணிக்கை முடிவுகள்
- பணப்பாய்வு
- இருப்பு நிலைக்குறிப்பு
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Jaiprakash Associates Ltd. அறிக்கை
- கணக்கியல் கோட்பாடுகள்
- தணிக்கையாளர்கள் அறிக்கை
- இயக்குநர்கள் அறிக்கை
- கணக்கு குறிப்புகள்
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Jaiprakash Associates Ltd. கார்ப்பரேட் அறிவிப்புகள்
- புத்தக முடிவு
- ஈவுத்தொகை
- நிர்வாகக் குழுக் கூட்டங்கள்
