Khadim India Ltd. இன் கணக்கு குறிப்புகள்

Mar 31, 2025

3.16 Provisions, Contingent liabilities and Contingent assets

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. The expense
relating to any provision is presented in the statement of profit or loss, net of any reimbursement. If the
effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the
provision due to the passage of time is recognized as part of finance costs.

A contingent liability is a possible obligation that arises from past events whose existence will be
confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the
control of the Company or a present obligation that is not recognized because it is not probable that an
outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely
rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The
Company does not recognize a contingent liability but discloses its existence in the financial statements.

The Company does not recognise contingent assets.

3.17 Dividend Distribution

Dividends paid (including income tax thereon) is recognized in the period in which the interim dividends
are approved by the Board of Directors, or in respect of the final dividend when approved by Shareholders.

3.18 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, as defined above, net of outstanding cash credit as they are considered an integral part of the
Company''s cash management.

3.19 Financial instruments, Financial assets, Financial liabilities and Equity instruments

Financial assets and financial liabilities are recognized when the Company becomes a party to the
contractual provisions of the relevant instrument and are initially measured at fair value. Transaction costs
that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other
than financial assets and financial liabilities measured at fair value through profit or loss) are added to or
deducted from the fair value on initial recognition of financial assets or financial liabilities.

Financial assets
Recognition

Financial assets include Investments, Trade receivables, Advances, Security Deposits, Cash and cash
equivalents. Such assets are initially recognized at transaction price when the Company becomes party
to contractual obligations. The transaction price includes transaction costs unless the asset is being fair

valued through the Statement of Profit and Loss. Investment in Subsidiary is carried at cost.
Classification

Management determines the classification of an asset at initial recognition depending on the purpose
for which the assets were acquired. The subsequent measurement of financial assets depends on such
classification. Financial assets are classified as those measured at:

a. amortised cost, where the financial assets are held solely for collection of cash flows arising from
payments of principal and/ or interest.

b. fair value through other comprehensive income (FVTOCI), where the financial assets are held not
only for collection of cash flows arising from payments of principal and interest but also from the sale
of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses
arising from changes in the fair value being recognized in other comprehensive income.

c. fair value through profit or loss (FVTPL), where the assets are managed in accordance with an
approved investment strategy that triggers purchase and sale decisions based on the fair value of
such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses
arising from changes in the fair value being recognized in the Statement of Profit and Loss in the
period in which they arise.

Trade receivables, Advances, Security Deposits, Cash and cash equivalents etc. are classified for
measurement at amortised cost while investments may fall under any of the aforesaid classes.
However, in respect of particular investments in equity instruments that would otherwise be
measured at fair value through profit or loss, an irrevocable election at initial recognition may be
made to present subsequent changes in fair value through other comprehensive income.

Impairment

The Company assesses at each reporting date whether a financial asset (or a group of financial assets) such
as investments, trade receivables, advances and security deposits held at amortised cost and financial
assets that are measured at fair value through other comprehensive income are tested for impairment
based on evidence or information that is available without undue cost or effort. Expected credit losses
are assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated
significantly since initial recognition.

Reclassification

When and only when the business model is changed, the Company shall reclassify all affected financial
assets prospectively from the reclassification date as subsequently measured at amortised cost, fair value
through other comprehensive income, fair value through profit or loss without restating the previously
recognized gains, losses or interest and in terms of the reclassification principles laid down in the Ind AS
relating to Financial Instruments.

Derecognition

Financial assets are derecognized when the right to receive cash flows from the assets has expired, or has
been transferred, and the Company has transferred substantially all of the risks and rewards of ownership.
Concomitantly, if the asset is one that is measured at:

a. amortised cost, the gain or loss is recognized in the Statement of Profit and Loss;

b. fair value through other comprehensive income, the cumulative fair value adjustments previously
taken to reserves are reclassified to the Statement of Profit and Loss unless the asset represents an
equity investment in which case the cumulative fair value adjustments previously taken to reserves

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Income Recognition

Interest income is recognized in the Statement of Profit and Loss using the effective interest method.
Dividend income is recognized in the Statement of Profit and Loss when the right to receive dividend is
established.

Financial Liabilities

Borrowings, trade payables and other financial liabilities are initially recognized at the value of the
respective contractual obligations. They are subsequently measured at amortised cost. Any discount or
premium on redemption / settlement is recognized in the Statement of Profit and Loss as finance cost
over the life of the liability using the effective interest method and adjusted to the liability figure disclosed
in the Balance Sheet. Financial liabilities are derecognized when the liability is extinguished, that is, when
the contractual obligation is discharged, cancelled or on expiry.

Offsetting Financial Instruments

Financial assets and liabilities are offset and the net amount is included in the Balance Sheet where there
is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net
basis or realise the asset and settle the liability simultaneously.

Equity Instruments

Equity instruments are recognized at the value of the proceeds, net of direct costs of the capital issue.

4 Significant accounting judgments, estimates and assumptions

The preparation of standalone financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent liabilities at the date of the standalone financial statements
and the results of operations during the reporting period end. Although these estimates are based upon
management''s best knowledge of current events and actions, actual results could differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognized in the period in which the estimate is revised if the revision affects only that period,
or in the period of the revision and future periods if the revision affects both current and future periods.

Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty
at the end of the reporting period that may have a significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the next financial year.

I Useful lives of property, plant and equipment and intangible assets

Management reviews the useful lives of property, plant and equipment and intangible assets at least
once in a year. Such lives are dependent upon an assessment of both the technical lives of the assets and
also their likely economic lives based on various internal and external factors including relative efficiency
and operating costs. Accordingly depreciable lives are reviewed annually using the best information
available to the Management.

II Actuarial Valuation

The determination of Company''s liability towards employee benefits in the nature of gratuity and unpaid
leave balance is made through independent actuarial valuation including determination of amounts to
be recognized in the Statement of Profit and Loss and in other comprehensive income. Such valuation
depend upon assumptions determined after taking into account inflation, seniority, promotion and other
relevant factors such as supply and demand factors in the employment market. Information about such
valuation is provided in notes to the standalone financial statements.

16.3 During the year ended 31st March 2019, the Company had issued 4,417 equity shares of '' 10 each on exercise
of employee stock options. For details refer Note 43.

16.4 During the previous year, the Company had issued 4,08,768 fully convertible equity share warrants at '' 365
each on a preferential basis to one Promoter and two Non-Promoters. The said warrants were convertible into
fully paid-up equity shares of '' 10 at a premium of '' 355 each. Pursuant to the issue, the promoter had paid
'' 60.00 millions in full towards 1,64,384 share warrants which were then duly converted into an equivalent
number of equity shares. The remaining 2,44,384 share warrants were issued to two non-promoters and were
outstanding for conversion as on 31st March 2024. Subsequently, the said warrants were converted during
the current financial year and 1,64,384 and 80,000 equity shares were issued on 29th May 2024 and 19th July
2024 respectively.

16.5 Rights, Preferences and Restrictions attached to Equity Shares

The Company has one class of Equity Shares having a face value of '' 10/- per share. Each shareholder is eligible
for one vote per share held. The Dividend proposed by the Board of Directors is subject to the approval of the
Shareholders in the Annual General Meeting, except in case of Interim Dividend. In the event of liquidation,
the Equity shareholders are eligible to receive the remaining assets of the Company after distribution of all
preferential amounts, in proportion to their shareholding.

18.2 Nature of Security of Term Loans from Banks

1 Primary security - Hypothecation charge on inventory, receivables and all other current assets of the
Company, both present and future, on second pari-passu basis with other working capital member
banks under the consortium.

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and
Civil Station, Bangalore on second pari-passu basis with other working capital members banks under the
consortium, lien on fixed deposit on second pari-passu basis, and equitable mortgage of properties at
Kasba and Gariahat

2 Primary security - Same as State Bank of India Term loan (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore
and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital
members banks under the consortium, equitable mortgage of properties at Chandannagar, Rashbehari
Avenue and Madhyamgram.

3 First charge on specific immovable and movable property, plant and equipment of the company and
personal guarantee of promoter.

19.2 (i) The Company has recognised expenses of '' 62.45 millions (Previous year - '' 55.11 millions) in relation to

short-term leases and recorded as ''Rent expenses'' and ''Commission and Discount expenses'' of '' 59.36
millions and '' 3.09 millions respectively for the year ended 31st March 2025 under ''Other Expenses'' in
Note 33.

19.2 (ii) The Company has recognised expenses of '' 2.73 millions (Previous Year - '' 3.08 millions) as variable lease

payment for commissioned outlets and '' Nil (Previous Year - '' 0.36 millions) for leased outlet for the year
ended 31st March 2025 and recorded as ''Commission and Discount'' under Other Expenses in Note 33.

The Company has also recognised expenses of '' 4.71 millions (Previous Year - '' 4.71 millions) as variable
lease payment on account of Solar Power generated for the year ended 31st March 2025 and recorded
as ''Power & Fuel'''' under Other Expenses'' in Note 33.

22.1 Nature of Security of Cash Credit and Working Capital Demand Loans from Banks

1 Primary security - Hypothecation charge on inventory, receivables and all other current assets of the
Company, both present and future, on pari-passu basis with other working capital member banks under
the consortium.

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore
and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital
members banks under the consortium, equitable mortgage of property at Kasba and Gariahat, personal
guarantee of promoter and corporate guarantee of group company.

2 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore
and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital
members banks under the consortium, equitable mortgage of property at Howrah, lien on fixed deposit,
personal guarantee of promoter and corporate guarantee of group company.

3 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and
Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members
banks under the consortium, equitable mortgage of properties at Chandannagar, Rashbehari Avenue
and Madhyamgram, personal guarantee of promoter and corporate guarantee of group company.

4 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore
and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital
members banks under the consortium, personal guarantee of promoter and corporate guarantee of
group company.

35 Discontinued operations

The Board of Directors of the Company, at its meeting dated 29th September 2023, had approved a Scheme
of Arrangement between Khadim India Limited (KIL) and KSR Footwear Limited (KFL) and their respective
shareholders and creditors under sections 230 to 232, 66 and other relevant provisions of the Companies Act,
2013. Pursuant to the Scheme, KIL shall demerge its distribution business, as a going concern, into KFL. Post
the Scheme becoming effective, the existing paid up equity share capital i.e., '' 1,00,000/- divided into 10,000
equity shares of face value '' 10/- each of KFL shall stand reduced and cancelled pursuant to section 66 and
other applicable provisions of the Companies Act, 2013 and KFL will issue 1 (one) equity share of face value
of '' 10/- each fully paid up for every 1 (one) equity share of face value '' 10/- each fully paid up held by equity
shareholders of KIL. KFL will reflect a mirror shareholding as that of KIL and thereafter it will function as an
independent listed Company. The Hon''ble National Company Law Tribunal, Kolkata Bench (NCLT), vide Order
dated 27 March, 2025, has sanctioned the Scheme of Arrangement. Accordingly the Appointed Date and
Effective Date of the Scheme is 1st April 2025 and 1st May 2025 respectively.

41 Employee Benefits

The Company has recognized, in the Statement of Profit and Loss for the year ended 31st March 2025 an
amount of '' 22.88 millions (Previous Year - '' 22.67 millions) as expenses under defined contribution plans
(Employer''s Contribution to Provident and Other Funds) under Note 31.

41.1 Defined Benefit Plan
Description of Plans

The employees'' gratuity fund scheme is managed by Life Insurance Corporation Of India (LICI) as a defined
benefit plan. The present value of obligation is determined by actuarial valuation using the Projected Unit
Credit Method , which recognizes each period of service as giving rise to additional unit of employee benefit
entitlement and measures each unit separately to build up the final obligation.

Risk Management

The Defined Benefit Plans expose the Company to risk of actuarial deficit arising out of investment risk, interest
rate risk and salary cost inflation risk.

Investment Risks: This may arise from volatility in asset values due to market fluctuations and impairment of
assets due to credit losses. These Plans primarily invest in debt instruments such as Government securities and
highly rated corporate bonds - the valuation of which is inversely proportional to the interest rate movements.

Interest Rate Risk: The present value of Defined Benefit Plans liability is determined using the discount rate
based on the market yields prevailing at the end of reporting period on Government Bonds. Decrease in yields
will increase the fund liabilities and vice-versa.

Salary Cost Inflation Risk: The present value of the Defined Benefit Plan liability is calculated with reference
to the future salaries of participants under the Plan. Increase in salary due to adverse inflationary pressures
might lead to higher liabilities.

Longevity Risk: The present value of the Defined Benefit Plan liability is calculated by reference to the best
estimate of the mortality of plan participants both during and after their employment. An increase in the life
expectancy of the plan participants will increase the plan''s liability.

X. Sensitivity Analysis

The sensitivity analysis below has been determined based on reasonably possible change of the respective
assumptions occurring at the end of the reporting period, while holding all other assumptions constant.
These sensitivities show the hypothetical impact of a change in each of the listed assumptions in isolation.
While each of these sensitivities holds all other assumptions constant, in practice such assumptions rarely
change in isolation and the asset value changes may offset the impact to some extent. For presenting the
sensitivities, the present value of the Defined Benefit Obligation has been calculated using the projected
unit credit method at the end of the reporting period, which is the same as that applied in calculating the
Defined Benefit Obligation presented above. There was no change in the methods and assumptions used in
the preparation of the Sensitivity Analysis from previous year.

42.1 Refer Note 22.1 in respect of guarantees given for loans taken by the Company.

42.2Post employment benefits are actuarially determined on overall basis and not included above.

42.3Mr.Siddhartha Roy Burman was re-designated from ''Chairman and Managing Director'' to ''Managing Director''
on 29 September 2024 and then to ''Executive Chairman'' on 1st April 2025.

42.4 Mr.Rittick Roy Burman was re-designated from ''Wholetime Director'' to ''Managing Director'' on 1st April 2025.

42.5Prof.(Dr.) Surabhi Banerjee was re-designated from ''Non-Executive Independent Director'' to ''Chairperson,
Independent Director'' on 29th September 2024 and then to ''Non-Executive Independent Director'' on
31st March 2025

42.6Mrs.Upma Mukherjee was re-designated from “Non-Executive Non-Independent Director” to "Non-Executive
Independent Director” of the Company on 1st April 2025

42.7 Mr.Indrajit Chaudhuri was re-designated from ''Chief Financial Officer'' to Group Chief Financial Officer'' on 29th
September 2024

42.8 Mr.Abhijit Dan was re-designated from ''Company Secretary and Head Legal'' to ''Group Company Secretary
and Head Legal'' on 29th September 2024.

C Financial risk management objectives

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity
risk. The Company''s financial risk management process seeks to enable the early identification, evaluation
and effective management of key risks facing the business. Backed by strong internal control systems, the
current risk management framework rests on policies and procedures issued by appropriate authorities;
process of regular reviews to set appropriate risk limits and controls; monitoring of such risks and compliance
confirmation for the same.

Interest rate risk

As majority of the financial assets and liabilities of the Company are either non-interest bearing or fixed
interest bearing instruments, the Company''s net exposure to interest risk is negligible.

Price risk

The Company invests its short term funds primarily in debt mutual fund. Accordingly, these do not pose any
significant price risk.

Liquidity Risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company
manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities,
by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial
assets and liabilities. The Company consistently generated strong cash flows from operations by ensuring
timely collections of its trade receivables and this together with the available cash and cash equivalents
provides adequate liquidity in short terms as well in the long term.

Credit Risk

The Company''s customer base is diverse limiting the risk arising out of credit concentration. Further, credit
is extended in business interest in accordance with guidelines issued centrally and business-specific credit
policies. All overdue customer balances are evaluated taking into account the age of the dues, specific credit
circumstances, the track record of the counterparty etc. Loss allowances and impairment are recognized,
where considered appropriate by responsible management.The Company has adopted a simplified approach
by computing the expected credit loss allowance for trade receivables based on a provision matrix taking into
account historical credit loss experience.

Of the trade receivables balance at the end of the year, no dues from any one customer exceeded 20 per cent
of gross financial assets. The Company does not have significant credit risk exposure to any single counterparty
or any group of counterparties having similar characteristics.

Foreign currency Risk

The Company undertakes transactions denominated in foreign currency (mainly US Dollar, Euro and Pound
Sterling) which are subject to the risk of exchange rate fluctuations. Financial assets and liabilities denominated
in foreign currency are also subject to reinstatement risks.

The aforesaid contracts have a maturity of less than 1 year from the year end.

45 Fair value measurement
Fair value hierarchy

Fair value of the financial instruments is classified in various hierarchies based on the following three levels:
Level 1: Quoted prices (unadjusted) in active market for identical assets or liabilities

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

The fair value of financial instruments that are not traded in an active market is determined using market
approach and valuation techniques which maximise the use of observable market data and rely as little as
possible on entity-specific estimates. If significant inputs required to fair value an instrument are observable,
the instrument is included in Level 2.

Level 3: Inputs for the assets and liabilities that are not based on observable market data (unobservable
inputs).

If one or more of the significant inputs is not based on observable market data, the fair value is determined
using generally accepted pricing models based on a discounted cash flow analysis, with the most significant
inputs being the discount rate that reflects the credit risk of counterparty.

The fair value of trade receivables, current investments, trade payables, other current financial assets and
liabilities and short-term borrowings are considered to be equal to the carrying amounts of these items due
to their short-term nature and accordingly not included in the below table. Where such items are Non-current
in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis.
Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or
if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of
fair value.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company
has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no
transfers between Level 1 and Level 2 during the year.

47 In respect of borrowings from banks on the basis of security of current assets, there are no material discrepancies
between the quarterly returns or statements of current assets filed by the Company with banks and the books
of account.

49 The financial statements were approved for issue by the Board of Directors on 20th May 2025.

50 Previous year''s figures have been regrouped/rearranged wherever necessary to make them comparable with
those of current year.

For and on behalf of Board of Directors

Siddhartha Roy Burman Rittick Roy Burman

Executive Chairman Managing Director

DIN: 00043715 DIN: 08537366

Abhijit Dan Indrajit Chaudhuri

Place: Kolkata Group Company Secretary & Head - Legal Group Chief Financial Officer

Date: 20^th May 2025 Membership No.: ACS 21358 Membership No.:FCA 61162

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Mar 31, 2024

3.16 Provisions

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. The expense relating to any provision is presented in the statement of profit or loss, net of any reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as part of finance costs.

3.17 Dividend Distribution

Dividends paid (including income tax thereon) is recognized in the period in which the interim dividends are approved by the Board of Directors, or in respect of the final dividend when approved by Shareholders.

3.18 Contingent liability

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

3.19 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, as defined above, net of outstanding cash credit as they are considered an integral part of the Company''s cash management.

3.20 Financial instruments, Financial assets, Financial liabilities and Equity instruments

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the relevant instrument and are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities measured at fair value through profit or loss) are added to or deducted from the fair value on initial recognition of financial assets or financial liabilities.

Financial assets

Recognition

Financial assets include Investments, Trade receivables, Advances, Security Deposits, Cash and cash equivalents. Such assets are initially recognized at transaction price when the Company becomes party to contractual obligations. The transaction price includes transaction costs unless the asset is being fair valued through the Statement of Profit and Loss. Investment in Subsidiary is carried at cost.

Classification

Management determines the classification of an asset at initial recognition depending on the purpose for which the assets were acquired. The subsequent measurement of financial assets depends on such classification. Financial assets are classified as those measured at:

a. amortised cost, where the financial assets are held solely for collection of cash flows arising from payments of principal and/ or interest.

b. fair value through other comprehensive income (FVTOCI), where the financial assets are held not only for collection of cash flows arising from payments of principal and interest but also from the sale of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognized in other comprehensive income.

c. fair value through profit or loss (FVTPL), where the assets are managed in accordance with an approved investment strategy that triggers purchase and sale decisions based on the fair value of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognized in the Statement of Profit and Loss in the period in which they arise.

Trade receivables, Advances, Security Deposits, Cash and cash equivalents etc. are classified for measurement at amortised cost while investments may fall under any of the aforesaid classes. However, in respect of particular investments in equity instruments that would otherwise be measured at fair value through profit or loss, an irrevocable election at initial recognition may be made to present subsequent changes in fair value through other comprehensive income.

Impairment

The Company assesses at each reporting date whether a financial asset (or a group of financial assets) such as investments, trade receivables, advances and security deposits held at amortised cost and financial assets that are measured at fair value through other comprehensive income are tested for impairment based on evidence or information that is available without undue cost or effort. Expected credit losses are assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantly since initial recognition.

Reclassification

When and only when the business model is changed, the Company shall reclassify all affected financial assets prospectively from the reclassification date as subsequently measured at amortised cost, fair value through other comprehensive income, fair value through profit or loss without restating the previously recognized gains, losses or interest and in terms of the reclassification principles laid down in the Ind AS relating to Financial Instruments.

Derecognition

Financial assets are derecognized when the right to receive cash flows from the assets has expired, or has been transferred, and the Company has transferred substantially all of the risks and rewards of ownership. Concomitantly, if the asset is one that is measured at:

a. amortised cost, the gain or loss is recognized in the Statement of Profit and Loss;

b. fair value through other comprehensive income, the cumulative fair value adjustments previously taken to reserves are reclassified to the Statement of Profit and Loss unless the asset represents an equity investment in which case the cumulative fair value adjustments previously taken to reserves is reclassified within equity.

Income Recognition

Interest income is recognized in the Statement of Profit and Loss using the effective interest method. Dividend income is recognized in the Statement of Profit and Loss when the right to receive dividend is established.

Financial Liabilities

Borrowings, trade payables and other financial liabilities are initially recognized at the value of the respective contractual obligations. They are subsequently measured at amortised cost. Any discount or premium on redemption / settlement is recognized in the Statement of Profit and Loss as finance cost over the life of the liability using the effective interest method and adjusted to the liability figure disclosed in the Balance Sheet. Financial liabilities are derecognized when the liability is extinguished, that is, when the contractual obligation is discharged, cancelled or on expiry.

Offsetting Financial Instruments

Financial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

Equity Instruments

Equity instruments are recognized at the value of the proceeds, net of direct costs of the capital issue.

4 Significant accounting judgments, estimates and assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

I Useful lives of property, plant and equipment and intangible assets

Management reviews the useful lives of property, plant and equipment and intangible assets at least once in a year. Such lives are dependent upon an assessment of both the technical lives of the assets and also their likely economic lives based on various internal and external factors including relative efficiency and operating costs. Accordingly depreciable lives are reviewed annually using the best information available to the Management.

II Actuarial Valuation

The determination of Company''s liability towards employee benefits in the nature of gratuity and unpaid leave balance is made through independent actuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and in other comprehensive income. Such valuation depend upon assumptions determined after taking into account inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market. Information about such valuation is provided in notes to the financial statements.

17.2 Nature of Security of Term Loans from Banks

1 Primary security - Hypothecation charge on inventory, receivables and all other current assets of the Company, both present and future, on second pari-passu basis with other working capital member banks under the consortium.

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore on second pari-passu basis with other working capital members banks under the consortium, lien on fixed deposit on second pari-passu basis, and equitable mortgage of properties at Kasba and Gariahat.

2 Primary security - Same as State Bank of India Term loan (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, equitable mortgage of properties at Chandannagar, Rashbehari Avenue and Madhyamgram.

3 Primary security - Same as State Bank of India Term loan (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on second pari-passu basis with other working capital members banks under the consortium.

18.2 (i) The Company has recognised expenses of '' 55.11 millions (Previous year - '' 52.74 millions) in relation

to short-term leases and recorded as ''Rent expenses'' and ''Commission and Discount expenses'' of '' 54.15 millions and '' 0.96 millions respectively for the year ended 31st March 2024 under ''Other Expenses'' in Note 31.

18.2 (ii) The Company has recognised expenses of '' 3.08 millions (Previous Year - '' 3.07 millions) as variable lease

payment for commissioned outlets and '' 0.36 millions (Previous Year - '' 0.92 millions) for leased outlet for the year ended 31st March 2024 and recorded as ''Commission and Discount'' under Other Expenses in Note 31.

21.1 Nature of Security of Cash Credit and Working Capital Demand Loans from Banks

1 Primary security - Hypothecation charge on inventory, receivables and all other current assets of the Company, both present and future, on pari-passu basis with other working capital member banks under the consortium.

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, equitable mortgage of property at Kasba and Gariahat, personal guarantee of Managing Director and corporate guarantee of group company.

2 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, personal guarantee of Managing Director and corporate guarantee of group company.

3 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, equitable mortgage of property at Howrah, lien on fixed deposit, personal guarantee of Managing Director and corporate guarantee of group company.

4 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, lien on fixed deposit, personal guarantee of Managing Director and corporate guarantee of group company.

5 Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Serampore, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, and lien on fixed deposit on pari-passu basis with other working capital members banks under the consortium, equitable mortgage of properties at Chandannagar, Rashbehari Avenue and Madhyamgram, personal guarantee of Managing Director and corporate guarantee of group company.

The claims disputed by the Company as above relate to issues of applicability and classification and it is not practicable for the Company to estimate the closure of these issues and the consequential timings of cash flows, if any, in respect of the above.

36 The Board of Directors of the Company, at its meeting dated 29th September 2023, has approved a Scheme ofArrangement between Khadim India Limited (KIL) and KSR Footwear Limited (KFL) and their respective shareholders and creditors under sections 230 to 232, 66 and other relevant provisions of the Companies Act, 2013. Pursuant to the Scheme, KIL shall demerge its distribution business, as a going concern, into KFL. Post the Scheme becoming effective, the existing paid up equity share capital i.e., '' 1,00,000/- divided into 10,000 equity shares of face value '' 10/- each of KFL shall stand reduced and cancelled pursuant to section 66 and other applicable provisions of the Companies Act, 2013 and KFL will issue 1 (one) equity share of face value of '' 10/- each fully paid up for every 1 (one) equity share of face value '' 10/- each fully paid up held by equity shareholders of KIL. KFL will reflect a mirror shareholding as that of KIL and thereafter it will function as an independent listed Company. The Scheme is subject to approval of the shareholders, secured and unsecured creditors, Hon''ble National Company Law Tribunal (NCLT), the stock exchanges and such other persons or governmental authorities as may be set out in the Scheme of Arrangement. The Scheme has been approved by BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) on 30th April, 2024 and the matter is presently pending with the Hon''ble NCLT.

37 The Hon''ble National Company Law Tribunal, Kolkata Bench vide its order dated 6th January 2021, approved a Scheme of Arrangement under Sections 230-232 and other applicable provisions of the Companies Act, 2013 ("Scheme). Pursuant to the Scheme, the entire undertaking of Tetenal Photocheme Private Limited, Photo Imaging Private Limited, Moviewallah Communications Private Limited and Knightsville Private Limited ("Transferor Companies"), together with all assets and liabilities relating thereto were amalgamated in Khadim Development Company Private Limited (''Transferee Company") with appointed date being 1st October 2019. The said scheme became effective w.e.f. 8th September 2021, pursuant to which, all the shares of the Company held by the said transferor companies were transferred to Khadim Development Company Private Limited which hence became the holding company of Khadim India Limited.

39.1 Defined Benefit Plan Description of Plans

The employees'' gratuity fund scheme is managed by Life Insurance Corporation Of India (LICI) as a defined benefit plan. The present value of obligation is determined by actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Risk Management

The Defined Benefit Plans expose the Company to risk of actuarial deficit arising out of investment risk, interest rate risk and salary cost inflation risk.

Investment Risks: This may arise from volatility in asset values due to market fluctuations and impairment of assets due to credit losses. These Plans primarily invest in debt instruments such as Government securities and highly rated corporate bonds - the valuation of which is inversely proportional to the interest rate movements.

Interest Rate Risk: The present value of Defined Benefit Plans liability is determined using the discount rate based on the market yields prevailing at the end of reporting period on Government Bonds. Decrease in yields will increase the fund liabilities and vice-versa.

Salary Cost Inflation Risk: The present value of the Defined Benefit Plan liability is calculated with reference to the future salaries of participants under the Plan. Increase in salary due to adverse inflationary pressures might lead to higher liabilities.

Longevity Risk: The present value of the Defined Benefit Plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

C Financial risk management objectives

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company''s financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current risk management framework rests on policies and procedures issued by appropriate authorities; process of regular reviews to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.

Interest rate risk

As majority of the financial assets and liabilities of the Company are either non-interest bearing or fixed interest bearing instruments, the Company''s net exposure to interest risk is negligible.

Price risk

The Company invests its short term funds primarily in debt mutual fund. Accordingly, these do not pose any significant price risk.

Liquidity Risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. The Company consistently generated strong cash flows from operations by ensuring timely collections of its trade receivables and this together with the available cash and cash equivalents provides adequate liquidity in short terms as well in the long term.

Credit Risk

The Company''s customer base is diverse limiting the risk arising out of credit concentration. Further, credit is extended in business interest in accordance with guidelines issued centrally and business-specific credit policies. All overdue customer balances are evaluated taking into account the age of the dues, specific credit circumstances, the track record of the counterparty etc. Loss allowances and impairment are recognized, where considered appropriate by responsible management.The Company has adopted a simplified approach by computing the expected credit loss allowance for trade receivables based on a provision matrix taking into account historical credit loss experience.

43 Fair value measurement Fair value hierarchy

Fair value of the financial instruments is classified in various hierarchies based on the following three levels: Level 1: Quoted prices (unadjusted) in active market for identical assets or liabilities.

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

The fair value of financial instruments that are not traded in an active market is determined using market approach and valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Level 3: Inputs for the assets and liabilities that are not based on observable market data (unobservable inputs).

If one or more of the significant inputs is not based on observable market data, the fair value is determined using generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparty.

The fair value of trade receivables, current investments, trade payables, other current financial assets and liabilities and short-term borrowings are considered to be equal to the carrying amounts of these items due to their short-term nature and accordingly not included in the below table. Where such items are Non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.

47 The financial statements were approved for issue by the Board of Directors on 24^th May 2024.

For and on behalf of Board of Directors

Siddhartha Roy Burman Rittick Roy Burman

Chairman and Managing Director Wholetime Director DIN: 00043715 DIN: 08537366

Abhijit Dan Indrajit Chaudhuri

Company Secretary & Head - Legal Chief Financial Officer Membership No.: ACS 21358 Membership No.:FCA 61162

Place: Kolkata Date: 24^th May 2024

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Mar 31, 2018

1 Corporate information

Khadim India Limited (the ‘Company’) is a Public Limited Company engaged in the manufacturing / retail business of footwear and leather accessories. The Company is incorporated and domiciled in Republic of India. The address of its Registered office is “Kankaria Estate”, 5th Floor, 6, Little Russell Street, Kolkata - 700071.

After successful completion of Initial Public Offering (IPO), the Company listed its Equity Shares in BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) during the year.

2 Significant accounting judgments, estimates and assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

I Useful lives of property, plant and equipment and intangible assets

Management reviews the useful lives of property, plant and equipment and intangible assets at least once in a year. Such lives are dependent upon an assessment of both the technical lives of the assets and also their likely economic lives based on various internal and external factors including relative efficiency and operating costs. Accordingly depreciable lives are reviewed annually using the best information available to the Management.

II Actuarial Valuation

The determination of Company’s liability towards employee benefits in the nature of gratuity and unpaid leave balance is made through independent actuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and in other comprehensive income. Such valuation depend upon assumptions determined after taking into account inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market. Information about such valuation is provided in notes to the financial statements.

3.1 During the year, the Company has completed the initial public offer (IPO) with a fresh issue of 666,666 equity shares of Rs.10 each at a price of Rs. 750 per equity share. The Company listed its equity shares on 14th November 2017 on BSE and NSE.

3.2 Rights, Preferences and Restrictions attached to Equity Shares

The Company has one class of Equity Shares having a face value of Rs. 10/- per share. Each shareholder is eligible for one vote per share held. The Dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend. In the event of liquidation, the Equity shareholders are eligible to receive the remaining assets of the Company after distribution of all Preferential amounts, in proportion to their shareholding.

3.3 Equity Shares allotted as fully paid up bonus shares for the period of five years immediately preceding 31st March 2018

The Company had issued bonus shares during the year ended 31st March 2014 to the shareholders in the ratio of 1:3 aggregating 3,64,05,714 number of equity shares of Rs.10 each as fully paid by utilising balance in General Reserve Account and Surplus in Statement of Profit and Loss Account to the extent of Rs. 4.34 millions and Rs. 359.72 millions respectively.

3.4 Equity Shares allotted as fully paid pursuant to contract without payment being received in cash during the period of five years immediately preceding 31st March 2018

During the year 2014-15 the Company issued 51,63,293 Equity Shares of face value Rs. 10 each at a conversion premium of Rs. 140.03 per share on conversion of Zero Coupon Compulsorily Convertible Debentures (Unsecured) issued in 2013-14, as per the formula set

Out in, and each with rights, preferences and privileges contained in the Securities Subscription and Share Purchase Agreement.

During the year the Company has introduced the Khadim Employee Stock Option Plan (2017) through the resolution passed by the Board of Directors and the same was subsequently approved by the Shareholders.

Terms and conditions of Options granted

Each option entitles the holder thereof to apply for and be allotted one equity share of Rs. 10 each upon payment of the exercise price during the exercise period. The exercise period commences from the date of vesting of the Options and expires at the end of five years from such date.

The vesting period for conversion of Options is as follows:

On completion of 12 months from the date of grant of the Options

- 15% vests

On completion of 24 months from the date of grant of the Options

- 15% vests

On completion of 36 months from the date of grant of the Options

- 30% vests

On completion of 48 months from the date of grant of the Options

- 40% vests

The Options have been granted at the ‘market price’ as defined under the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

Further details of ‘Khadim Employee Stock Option Plan 2017’ are provided in Note 39.

4.1 Nature of Security of Cash Credit, Working Capital Demand Loans, Short Term Loans and Buyer’s credit from Banks

1. Primary security - Hypothecation charge on inventory, receivables and all other current assets of the Company, both present and future, on pari-passu basis with other working capital member banks under the consortium.

Collateral security - Equitable mortgage of properties at Kancharapara, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, on pari-passu basis with other working capital members banks under the consortium, equitable mortgage of property at Kasba, liquid security in the form of fixed deposits, personal guarantees of promoter directors and corporate guarantees of group companies.

2. Primary security - Same as State Bank of India Cash Credit (Refer Note 1 above).

Collateral security - Equitable mortgage of properties at Kancharapara, Salt Lake, KG Road, Bangalore and Civil Station, Bangalore, on pari-passu basis with other working capital members banks under the consortium, personal guarantees of promoter directors and corporate guarantees of group companies.

3. Primary security - Secured by hypothecation of all credit card receivables both present and future, mortgage of factory building at S19, S20 and S21 at Kasba, Kolkata, retail outlet at Rashbehari Avenue, Kolkata, Corporate guarantee of the Holding Company and personal guarantee of Managing Director.

4. Secured by personal guarantee of Managing Director.

5.1 There are no amounts due for payment to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956/ Section 125 of the Companies Act,2013 as at the year end.

5.2 The Government of India has implemented Goods and Services Tax (GST) from 1st July 2017 subsuming excise duty, service tax and various other indirect taxes. As per Ind AS, the revenue for the year ended 31st March 2018 is reported net of GST. Accordingly the numbers for the year ended 31st March 2018 are not comparable with the year ended 31st March 2017, which are reported inclusive of Excise Duty.

6 Miscellaneous Expenses included in “Note 30 - Other Expenses” includes expenditure incurred under Section 135 of the Companies Act, 2013 on Corporate Social Responsibility (CSR) activities and the same represents contributions for promoting health care. Gross amount required to be spent by the Company is Rs. 3.14 millions (Previous Year - Rs. 1.52 millions) and amount spent during the year is Rs. 1.02 millions (Previous Year - Rs. 1.52 millions).

7 The Company has identified one business segment namely “Footwear and accessories” which is consistent with internal reporting provided to the Chairman and Managing Director who is the Chief Operating Decision Maker (CODM).

Disclosure required under Ind AS 108 “ Operating Segments” for Companies with single segment are as follows :

8 Employee Benefits

The Company has recognized, in the Statement of Profit and Loss for the year ended 31st March 2018 an amount of Rs. 14.70 millions (Previous Year - Rs. 13.36 millions) as expenses under defined contribution plans (Employer’s Contribution to Provident Fund).

8.1 Defined Benefit Plan Description of Plans

The employees’ gratuity fund scheme is managed by Life Insurance Corporation Of India (LICI) as a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method , which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Risk Management

The Defined Benefit Plans expose the Company to risk of actuarial deficit arising out of investment risk, interest rate risk and salary cost inflation risk.

Investment Risks: This may arise from volatility in asset values due to market fluctuations and impairment of assets due to credit losses. These Plans primarily invest in debt instruments such as Government securities and highly rated corporate bonds - the valuation of which is inversely proportional to the interest rate movements.

Interest Rate Risk: The present value of Defined Benefit Plans liability is determined using the discount rate based on the market yields prevailing at the end of reporting period on Government Bonds. A decrease in yields will increase the fund liabilities and vice-versa.

Salary Cost Inflation Risk: The present value of the Defined Benefit Plan liability is calculated with reference to the future salaries of participants under the Plan. Increase in salary due to adverse inflationary pressures might lead to higher liabilities.

Longevity Risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.

X. Sensitivity Analysis

The Sensitivity Analysis below has been determined based on reasonably possible change of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. These sensitivities show the hypothetical impact of a change in each of the listed assumptions in isolation. While each of these sensitivities holds all other assumptions constant, in practice such assumptions rarely change in isolation and the asset value changes may offset the impact to some extent. For presenting the sensitivities, the present value of the Defined Benefit Obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the Defined Benefit Obligation presented above. There was no change in the methods and assumptions used in the preparation of the Sensitivity Analysis from previous year.

9 Financial Instruments and related disclosures

A Capital Management

The Company aims at maintaining a strong capital base safeguarding business continuity and augments its internal generations with a judicious use of borrowing facilities to meet the requirements of working capital that arise from time to time as well as requirements to finance business growth. The Company is not subject to any externally imposed capital requirements.

B Categories of Financial Instruments

C Financial risk management objectives

The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current risk management framework rests on policies and procedures issued by appropriate authorities; process of regular reviews / audits to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.

Interest rate risk

As majority of the financial assets and liabilities of the Company are either non-interest bearing or fixed interest bearing instruments, the Company’s net exposure to interest risk is negligible.

Price risk

The Company invests its short term funds primarily in debt mutual fund. Accordingly, these do not pose any significant price risk. Liquidity Risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. The Company consistently generated strong cash flows from operations by ensuring timely collections of its trade receivables and this together with the available cash and cash equivalents provides adequate liquidity in short terms as well in the long term.

Credit Risk

The Company’s customer base is diverse limiting the risk arising out of credit concentration. Further, credit is extended in business interest in accordance with guidelines issued centrally and business-specific credit policies. All overdue customer balances are evaluated taking into account the age of the dues, specific credit circumstances, the track record of the counterparty etc. Loss allowances and impairment is recognized, where considered appropriate by responsible management.The Company has adopted a simplified approach by computing the expected credit loss allowance for trade receivables based on a provision matrix taking into account historical credit loss experience.

Foreign currency Risk

The Company undertakes transactions denominated in foreign currency (mainly US Dollar, Euro and Pound Sterling) which are subject to the risk of exchange rate fluctuations. Financial assets and liabilities denominated in foreign currency are also subject to reinstatement risks.

The carrying amount of foreign currency denominated financial assets and liabilities, are as follows:

The Company uses forward exchange contracts to hedge its exposures in foreign currency. Accordingly, forward exchange contracts that were outstanding on respective reporting dates:

10 Fair value measurement Fair value hierarchy

Fair value of the financial instruments is classified in various hierarchies based on the following three levels:

Level 1: Quoted prices (unadjusted) in active market for identical assets or liabilities

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

The fair value of financial instruments that are not traded in an active market is determined using market approach and valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Level 3: Inputs for the assets and liabilities that are not based on observable market data (unobservable inputs).

If one or more of the significant inputs is not based on observable market data, the fair value is determined using generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparty.

The fair value of trade receivables, current investments, trade payables, other current financial assets and liabilities and short-term borrowings are considered to be equal to the carrying amounts of these items due to their short-term nature and accordingly not included in the below table. Where such items are Non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.

The following table presents the fair value hierarchy of assets and liabilities measured at fair value on a recurring basis:

11 First-time adoption of Ind AS

A Ind AS 101 (First-time Adoption of Indian Accounting Standards) provides a suitable point for accounting in accordance with Ind AS and is required to be mandatorily followed by first-time adopters. The Company has prepared the opening Balance Sheet as per Ind AS as of 1st April 2016 (the transition date) by:

- recognising all assets and liabilities whose recognition is required by Ind AS

- not recognising items of assets or liabilities which are not permitted by Ind AS

- reclassifying items from previous Generally Accepted Accounting Principles (GAAP) to Ind AS as required under Ind AS, and

- applying Ind AS in measurement of recognized assets and liabilities

B Reconciliation of total comprehensive income for the year ended 31st March 2017 to those reported under previous GAAP are summarised as follows:

Notes

1 Ind /AS 101 mandates certain exceptions and allows first-time adopters exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions in the financial statements:

i. Property, plant and equipment and intangible assets were carried in the Balance Sheet prepared in accordance with previous GAAP on 31st March 2016. Under Ind AS, the Company has elected to regard such carrying values as deemed cost at the date of transition.

ii. Ind AS 103 (Business Combinations) has not been applied retrospectively to business combinations that occurred prior to 1st April, 2016. Use of this exemption means that in the opening Balance Sheet, all assets and liabilities acquired in previous business combinations remain at the previous GAAP carrying values.

iii. The Company has applied Appendix C of Ind AS 17 (Leases) - ‘Determining whether an Arrangement contains a Lease’ to determine whether an arrangement existing at the transition date contains a lease on the basis of facts and circumstances existing at that date.

2 In addition to the above, the principal adjustments made by the Company in restating its previous GAAP financial statements, including the Balance Sheet as at 1st April 2016 and the financial statements as at and for the year ended 31st March 2017 are detailed below:

i. Under previous GAAP, leasehold properties were presented as fixed assets and amortised over the period of the lease. Under Ind AS, such properties have been classified as prepaid expenses within non-current assets (current portion presented as other current assets) and have been amortised over the period of the lease, resulting in decrease in property, plant and equipment by Rs. 121.98 millions as at 31st March 2017 and by Rs.141.21 millions as at 1st April 2016 and corresponding increase in other non-current assets by Rs. 119.81 millions as at 31st March 2017 and by Rs. 138.76 millions as at 1st April 2016 and in other current assets by Rs. 2.17 millions as at 31st March 2017 and by Rs. 2.45 millions as at 1st April 2016.

Such classification has resulted in decrease in depreciation and amortisation expense by Rs. 2.45 millions for the year ended 31st March 2017 and corresponding increase in other expenses, but does not affect profit before tax and total profit for the year ended 31st March 2017.

ii. Under the previous GAAP, investments in mutual funds were classified as non-current investments or current investments based on the intended holding period and realisability. Non-current investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are measured at fair value through profit or loss.

iii. Under the previous GAAP, actuarial gains / losses, arising in respect of employee benefit schemes were recognized in the statement of profit and loss. Under Ind AS, the actuarial gains and losses forming part of re-measurement of net defined benefit liability / asset is recognized in other comprehensive income in the respective periods.

iv. Under the previous GAAP, long term interest free security deposits given against operating lease are recorded at their transaction value. Under Ind AS, such financial assets have been accounted at amortised costs using the effective interest rate method.

v. Under previous GAAP, movements in cash credit facilities, repayable on demand, were reflected in cash flows from financing activities in cash flow statement. Under Ind AS, such cash credit facilities are included in cash and cash equivalents in the cash flow statement.

12 The Company has entered into operating Lease arrangements primarily for various commercial premises / retail outlets,distribution centres and land. Some of the significant terms and conditions are :

- These leasing arrangements which are not non - cancellable range between 11 months and 40 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms.

Rent in respect of the above amounting to ‘257.61 millions (Previous Year - Rs. 198.97 millions) has been charged to Statement of Profit and Loss in “Other Expenses” –

Note 13

14 Micro, Small and Medium scale business entities:

A sum of ‘60.63 millions is payable to Micro and Small Enterprises as at 31st March 2018 (31st March 2017 - ‘21.64 millions, 1st April, 2016 - ‘21.26 millions). There are no Micro, Small and Medium Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days during the year and also as at 31st March 2018. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

15 Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) (Amendment) Rules, 2018 on 28th March 2018 notifying Ind AS 115, ‘ Revenue from Contracts with Customers’ and amending Ind AS 21 ‘The Effects of Changes in Foreign Exchange Rates’; Ind AS 12 ‘Income Taxes’. The same are applicable for financial statements pertaining to annual periods beginning on or after 1st April 2018. The Company is in the process of assessing the detailed impact on the financial statements resulting from the implementation of these standards.

16 As at 31st March 2018, remuneration payable to four non-executive directors aggregating Rs. 0.40 million is subject to the approval of the Members at the forthcoming Annual General Meeting (Previous Year - Rs.Nil).

17 The financial statements were approved for issue by the Board of Directors on 11th May 2018.

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Mar 31, 2008

1. Contingent Liabilities

As at 31 March 2008 As at 31 March 2007 Rs. Rs.

(a) Claims not acknowledged as debts-

(i) Income Tax under Appeals Nil 25,599

(ii) Sales Tax under Appeals 20,064 18,990

(iii) Excise Duty under Appeals 1,555 92

(iv) Others 4,275 4,275

(b) Bank Guarantees 34,531 10,115

2. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account, net of advances and not provided for - Rs.44,142 (Previous Year - Rs. 68,530).

3. Pursuant to the Scheme of Amalgamation approved by the Honble High Court at Calcutta with effect from 1st October, 2004, the surplus of net assets over the equity shares issued as purchase consideration has been treated as Capital Reserve.

4. Premium of Rs.93,888 (Previous Year - Nil) received on issue of equity shares during the year has been credited to Share Premium Account and shown as part of Reserves and Surplus (Schedule 2)

5. Unsecured loans from others represent Gold loan taken by the Company which will be repaid in the form of gold.

6. Capital advances include advances of Rs.9,643 (Previous Year - Rs.29,230) paid for acquisition of lands / immovable properties, for which the related Deed of Conveyance / Lease Deed are yet to be executed.

7. Loans and advances (Schedule 10) include advances against share issue expenses aggregating to Rs. 5,532 (Previous Year - 2,679).

8. The Company has not received any information from its suppliers regarding registration under "The Micro, Small and Medium Enterprises Development Act, 2006". Hence, the information, as required to be given in accordance with Section 22 of the said Act have not been disclosed.

9. Interest debited to Profit and Loss Account is net of interest capitalized during the year amounting to Rs.4,834 (Previous Year - Nil)

10. Excise duty on uncleared goods (dutiable) amounting to Rs.2,864 (Previous Year - Rs.3,200) lying at factory/warehouse has been accounted for in these financial statements with a corresponding impact in the valuation of the year-end closing stock, the treatment of which is revenue neutral.

11. In the current year, the Company has adopted Accounting Standard (AS) IS on Employees Benefit (Revised) issued by The Institute of Chartered Accountants of India, which is mandatory from accounting period commencing on or after December 7, 2006. Accordingly the Company has provided for Gratuity and Leave Encashment based on actuarial valuation as per Projected Unit Credit Method. In accordance with the provision in the revised Accounting Standard, transitional provision of Rs. 1,776 and Rs.908 have been adjusted from the brought forward balance of Profit and Loss Account in respect of shortfall in opening balances of Gratuity and Leave Encashment respectively.

12. (a) Value of Derivative Contracts entered into by the Company for hedging gold and related risks and outstanding as on March 31, 2008 amounts to Rs.2,210 (Previous Year - Nil)

(b) In respect of outstanding Derivative Contracts which are stated in para "a" above there is a net unsettled loss of Rs.168 (Previous Year - Nil), which has been recognized in the accounts.

13. The Company is primarily engaged in the business of manufacturing retail business of footwear, leather accessories and other lifestyle household consumer goods catering predominantly to the domestic market and therefore, according to the management, this is a "Single Segment" Company, as envisaged in the Accounting Standard 17, issued by The Institute of Chartered Accountants of India.

14. Related Party Disclosures

(a) Related parties (as identified by the management) are classified as:

Ultimate Holding Company Knightsville Private Limited

Key Managerial Personnel (KMP) Mr. Satya Prasad Roy Burman- Whole time Director

Mr. Siddhartha Roy Burman- Managing Director Mrs.Tanusree Roy Burman - Non-Executive Director

Enterprises over which KMP and Khadim Financial Services (P) Ltd. their relatives have substantial Khadim Development Co. (P) Ltd. interests: Khadim Enterprise

K. M. Khadim & Co.

St. Marys Clinic & Drug Stores

Sheila Departmental Stores (P) Ltd.

Bee Tee Enterprise

Moviewallah Communications (P) Ltd.

Relatives of KMP Mr.Partha Roy Burman

Mrs.Basabdutta Roy Burman

Mrs.Namita Roy Burman

15. Leases

The Company has taken various premises including offices, warehouses and retails under operating lease arrangements. As per legal opinion obtained by the Company, such lease arrangements are mostly not non-cancellable leases, as envisaged in Accounting Standard 19 on "Leases" issued by The Institute of Chartered Accountants of India and are renewable by mutual consent or mutually agreed terms. However, the overall future lease commitments of such lease arrangements entered into by the Company will be Rs. 1,063,072 (Previous Year - R.s.718,219)

16. In the opinion of the Directors, except the amount already provided, there is no impairment on assets in terms of Accounting Standard 28 on "Impairment of Assets" issued by The Institute of Chartered Accountants of India.

17. Additional Information pursuant to provisions of paragraph 3, 4C and 4D of Part-II of Schedule VI to the Companies Act, 1956

18. Previous years figures have been regrouped / rearranged wherever necessary.

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Mar 31, 2007

1. Contingent Liabilities

As at 31 March 2007 As at 31 March 2006 Rs. Rs.

(a) Claims not acknowledged as debts-

(i) Income Tax under Appeals 25,599 15,291

(ii> Sales Tax under Appeals 18,990 13,963

(iii)Excise Duty under Appeals 92 5,200

(iv) Others 4,275 Nil

(b) Bank Guarantees 10,115 11,751

2. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account, net of advances and not provided for - Rs.68,530 (Previous Year - Rs. 3,387).

3. Pursuant to the Scheme of Amalgamation approved by the Honble High Court at Calcutta with effect from 1st October, 2004, Amalgamation Reserve has been treated as Capital reserve and represents the surplus of value of net assets over the equity shares issued as purchase consideration.

4. (a) Small Scale Industrial (SSI) Undertakings to whom the Company owed for more than 30 days as on 31 March 2007 were -

Sooky Leather - Delta Packaging Centre

Dutta Enterprise - Select Footwear

Charan Paduka industries (P) - Sahara Footwear Ltd.

Sabitri Udyog - Abhi Footwear

The above information has been determined to the extent such parties have been identified on the basis of the information available with the Company, which has been relied upon by the Auditors.

(b) The Company has not received any claims for interest on such dues from the said parties.

5. The Company has not received any information from its suppliers regarding registration under "The Micro, Small and Medium Enterprises Development Act, 2006". Hence, the information, as required to be given in accordance with Section 22 of the said Act have not been disclosed.

6. Arising out of the policy decision of funding gratuity liability to LICI, a sum of Rs. 1,537 (Previous Year - Rs. Nil) on the basis of actuarial valuation, made in earlier years by an actuary for the purpose, has been written back as income and a sum of Rs. 2,512 (Previous Year - Rs. Nil), being the Companys contribution to the gratuity fund has been charged to Profit and Loss Account for the year.

7. The Company is primarily engaged in the business of manufacturing retail business of footwear, leather accessories and other lifestyle household consumer goods catering predominantly to the domestic market and therefore, according to the management, this is a "Single Segment" Company, as envisaged in the Accounting Standard 17, issued by The Institute of Chartered Accountants of India.

8. Related Party Disclosures

(a) Related parties (as identified by the management) are classified as: Ultimate Holding Company Knightsville Private Limited

Key Managerial Personnel (KMP) Mr. Satya Prasad Roy Burman- Whole time Director

Mr. Siddhartha Roy Burman- Managing Director Mr.Partha Roy Burman - Whole time Director [Ceased to be a Director w.e.f. 26 March 2007 due to vacation of office by operation of law pursuant to section 283(1 )(g) of the Companies Act, 1956] Mrs. Namita Roy Burman- Non-Executive Director Prof. Ashok Dutta- Non-Executive Director Prof. A. N. Sadhu- Non-executive Director Mr. Indranath Chatterjee- Non-Executive Director

Enterprises over which KMP and Khadim Financial Services (P) Ltd. their relative have substantial Khadim Development Co. (P) Ltd. interests: Khadim Enterprise

K. M. Khadim & Co. St. Marys Clinic & Drug Stores Sheila Departmental Stores (P) Ltd. Bee Tee Enterprise Moviewallah Communications (P) Ltd.

Relatives of KMP Mr.Partha Roy Burman

Mrs. Basabdutta Roy Burman Mrs. Tanusree Roy Burman

9. Leases

The Company has taken various premises including offices, warehouses and retails under operating lease arrangements. As per legal opinion obtained by the Company, such lease arrangements are mostly not non-cancellable leases, as envisaged in Accounting Standard 19 on "Leases" issued by The Institute of Chartered Accountants of India and are renewable by mutual consent or mutually agreed terms. However, the overall future lease commitments of such lease arrangements entered into by the Company will be Rs.7,18,219 (Previous Year-Rs 2,26,197)

10. Excise duty on uncleared goods (dutiable) lying at factory/warehouse has been accounted for in these financial statements with a corresponding impact in the valuation of the year- end closing stock, the treatment of which is revenue neutral.

11. Previous years figures have been regrouped / rearranged wherever necessary.