The Members of CITIZEN INFOLINE LIMITED
We have audited accompanying Ind AS Standalone financial statements of M/s. CitizenInfoline Limited ("the Company") which comprises the Balance Sheet as at March31 2018 the Statement of Profit and Loss statement of changes in the Equity andstatement of cash flows for the year then ended and notes to the financial statementsincluding a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 312018 and profit/loss statement of change in equity and its cash flows forthe year ended on that date.
BASIS OF OPINION
We conducted our audit by the Standards on Auditing (SAs) specified under section143(10) of the Companies Act 2013. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled ourother ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion.
RESPONSIBILITY OF MANAGEMENT FOR THE STANDALONE FINANCIAL STATEMENTS
The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance (changes in equity)[iv] and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theaccounting Standards specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate implementationand maintenance of accounting policies; making judgments and estimates that are reasonableand prudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
Those Board of Directors is also responsible for overseeing the company's financialreporting process.
auditors responsibility for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted by SAs will alwaysdetect a material misstatement when it exists. Misstatements can arise from fraud or errorand are considered material if individually or in the aggregate they could reasonably beexpected to influence the economic decisions of users taken by these financial statements.
REPORT ON OTHER LEGAL AND REGuLATORY REQuiREMENTS
As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure A' a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
As required by Section 143(3) of the Act we report that:
We have sought and obtained all the information and explanations which to the best ofour knowledge and belief were necessary for our audit.
a. In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books
b. The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.
c. In our opinion those above standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
d. By the written representations received from the directors as on 31st March 2018taken on record by the Board of Directors none of the directors is disqualified as on31st March 2018 from being appointed as a director regarding Section 164 (2) of the Act.
e. Concerning the adequacy of the internal financial controls over financial reportingof the Company and the operating effectiveness of such controls refer to our separateReport in "Annexure B".
f. Concerning the other matters to be included in the Auditor's Report by Rule 11 ofthe Companies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation and according to the explanations given to us:
1. The Company does not have any pending litigations which would impact its financialposition.
2. The Company did not have any long-term contracts including derivative contracts forwhich there were any foreseeable material losses.
3. The company was not required to transfer any amount to the Investor Education andProtection Fund by the Company.
FOR MANTHAN M SHAH & ASSOCIATES
FIRM REG. No.145136W
ANNEXURE A TO THE AUDITOR'S REPORT
(Referred to in paragraph 5 of our report of even date)
I. Fixed Assets: -
(a) The Company has maintained proper records to show full particulars includingquantitative details and situation of fixed assets.
(b) The management has physically verified all the fixed assets at the year-end. Nomaterial discrepancies have been noticed on such verification.
(a) The stocks of finished goods stores and spares have been physically verifiedduring the year by the management. In our opinion the frequency of verification isreasonable.
(b) The procedure of physical verification of stocks followed by the management isreasonable and adequate about the size of the Company and the nature of its business.
(c) No material discrepancies have been noticed on physical verification of stocks ascompared to book records.
According to the information and explanation gave to us the company has granted loanssecured or unsecured to companies firms or their parties covered in the registermaintained under section 189 of the Companies Act 2013.
(a) In our opinion the Company has not granted a loan to a related party in violationof provisions of Section 189 of Companies Act 2013 during the current financial year. Theclosing amount outstanding is NIL.
(Rs. in Lacs)
|No of Parties ||One |
|Loan Given during the year ||1026810 |
|Received back During the year ||1026810 |
|Maximum Outstanding in Year ||900000 |
|Closing Balance ||0 |
(b) According to information and explanations are given to us the Company has nottaken loans from any parties covered in the register maintained under section 189 of theCompanies Act 2013.
(c) In our opinion the rate of interest and other terms and conditions on which loanshave been taken from the parties listed in the register maintained under section 189 ofthe Companies Act 2013 are not prima facie prejudicial to the interest of the Company.
IV. In our opinion and according to the information and explanations are given to usThe Company has complied with the provisions of section 185and 186 of companies Act 2013in respect of the loan Investment Guarantee and security.
V. In our opinion and according to the information and explanations are given to usthe Company has not accepted any deposit during the current financial year.
VI. The Central Government has not prescribed maintenance of cost records under section148(1) of the Act. We have broadly reviewed the accounts and records of the Company inthis connection and are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained. We have not however carried out a detailedexamination of the same.
VII. (a) The Company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income tax sales tax wealth tax servicetax the duty of customs the duty of excise value-added tax cess and any otherstatutory dues with appropriate authorities.
(b) According to the information and explanation gave to us there were no undisputedamounts payable in respect of Income-Tax Wealth-Tax Sales Tax Customs Duty and ExciseDuty which have remained outstanding as at 31st March 2018 for more than sixmonths from the date they became payable.
(c) The company is not required to transfer any amount to investor education andprotection fund by provisions of Companies Act 2013 or rules made thereunder.
VIII. By the verification of records and information and explanations given to us theCompany has not defaulted in repayment of dues to financial institutions or banks.
IX. The Company did not raise any money by way of an initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3 (ix) of the Order is not applicable.
X. Based on the Audit procedure performed and the representation obtained from themanagement we report that no case of material fraud on or by the Company has been noticedor reported during the year under Audit
XI. According to the information and explanation gave to us all the transactions withthe related parties comply with section 177 and section 188 of the companies act 2013.
XII. According to the information and explanation gave to us we Report that thecompany has not entered into any non-cash Transaction (u/s 192 companies act 2013) withits Directors or the with the persons connected with it.
XIII. The company has not made any preferential allotment or private placement ofshares or fully or partially convertible debentures during the financial year.
XIV. The company has paid/provided for managerial remuneration as per provisions ofSection 197 read with Schedule V of Companies Act 2013.
FOR MANTHAN M SHAH & ASSOCIATES
FIRM REG. No.145136W
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of CitizenInfoline Limited ("the Company") as of March 312018 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India". These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness.
Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for my /our audit opinion on the Company's internal financial controlssystem over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes by generally accepted accountingprinciples. A company's internal financial control over financial reporting includes thosepolicies and procedures that
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements by generally accepted accounting principles and thatreceipts and expenditures of the company are being made only by authorisations ofmanagement and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as of March 312018 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
FOR MANTHAN M SHAH & ASSOCIATES
FIRM REG. No.145136W
21. Citizen Infoline Limited was incorporated in the year 1994. Citizen's yellow pageshave been in the local search and print media. It has various branches across the state ofGujarat.
22. Figures of previous year have been regrouped/rearranged wherever necessary.
23. The information regarding suppliers holding permanent registration certificate as asmall-scale industrial undertaking or as an ancillary industrial undertaking issued by theDirectorate of Industries of the state is not available. In the absence of suchinformation the amount and interest due as per the Interest on delayed payments to Smalland Ancillary Industries Act 1993 is not ascertainable. There is no claim for payment ofinterest under the law above.
24. Disclosures under Section 22 of Micro Small and Ancillary Industries Act 2006 canbe considered on receiving relevant information from suppliers who are covered under theact is received.
25. Foreign Exchange Earnings and Outgo
|PARTICULARS ||2017-18(Rs.) ||2016-17 (Rs.) |
|Foreign Exchange Earnings ||---- || |
|Foreign Exchange Outgo || ||--- |
26. SIGNIFICANT ACCOUNTING POLICIES
The basis of Preparation of Financial Statements
a) The financial statements have been prepared under the historical cost convention bythe generally accepted accounting principles on going concern basis and provisions of theCompanies Act 2013 as adopted consistently by the company. The accounts are materiallycomplying with Accounting Standards issued by The Institute of Chartered Accountants ofIndia.
b) The company generally follows a mercantile system of accounting and recognisessignificant items of income and expenditure on accrual basis. However Municipal Tax isrecognised on Cash Basis.
Disclosure of Accounting Policies
The Accounting Principles and policies recognized as appropriate for measurement andreporting of the financial performance and the financial position on Accrual Basis exceptotherwise disclosed using historical cost i.e. not taking into account changing moneyvalues/impact of inflation are applied in the preparation of the financial statement andthose which are considered material to the affairs are suitably disclosed. The statementon Significant Accounting policy excludes disclosures regarding Accounting Standards inrespect of which there are no material transactions during the year.
Valuation of Inventories
The Company operates in the service industry. Therefore it does not have anyinventory.
Current versus non-current classification
The Company presents assets and liabilities in the balance sheet based on current/non-current classification. An asset is treated as current when it is:
o Expected to be realised or intended to be sold or consumed in the normal operatingcycle o Held primarily for trading
o Expected to be realised within twelve months after the reporting period or
o Cash or cash equivalent unless restricted from being exchanged or used to settle aliability for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
o It is expected to be settled in the normal operating cycle o It is held primarily fortrading
o It is due to be settled within twelve months after the reporting period or
o There is no unconditional right to defer the settlement of the liability for at leasttwelve months after the reporting period.
Deferred tax assets and liabilities are classified as non-current assets andliabilities.
The company classifies all other liabilities as non-current. The operating cycle is thetime between the acquisition of assets for processing and their realisation in cash andcash equivalents. The company has identified twelve months as its operating cycle.
Functional and Presentation Currency
These standalone financial statements are presented in Indian rupees which is thefunctional currency of the Company. All financial information presented in Indian rupeeshas been rounded to the nearest rupees except otherwise indicated.
(i) Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided. Aliability is recognised for the amount expected to be paid if the Company has a presentlegal or constructive obligation to pay this amount as a result of past service providedby the employee and the obligation can be estimated reliably.
(ii) Defined contribution plans
Obligations for contributions to defined contribution plans are expensed as the relatedservice is provided and the Company will have no legal or constructive obligation to payfurther amounts. Prepaid contributions are recognised as an asset to the extent that acash refund or a reduction in future payments is available.
(iii) Defined benefit plans
The Company's net obligation in respect of defined benefit plans is calculatedseparately for each plan by estimating the amount of future benefit that employees haveearned in the current and prior periods discounting that amount and deducting the fairvalue of any plan assets. The calculation of defined benefit obligations is performedperiodically by an independent qualified actuary using the projected unit credit method.When the calculation results in a potential asset for the Company the recognised asset islimited to the present value of economic benefits available in the form of any futurerefunds from the plan or reductions in future contributions to the plan. To calculate thepresent value of economic benefits consideration is given to any applicable minimumfunding requirements. Re-measurement of the net defined benefit liability which compriseactuarial gains and losses and the return on plan assets (excluding interest) and theeffect of the asset ceiling (if any excluding interest) are recognised immediately inother comprehensive income (OCI). Net interest expense (income) on the net definedliability (asset) is computed by applying the discount rate used to measure the netdefined liability (asset). Net interest expense and other expenses related to definedbenefit plans are recognised in Statement of Profit and Loss.
When the benefits of a plan are changed or when a plan is curtailed the resultingchange in the benefit that relates to past service or the gain or loss on curtailment isrecognised immediately in Statement of Profit and Loss. The Company recognises gains andlosses on the settlement of a defined benefit plan when the settlement occurs.
(iv) Other long-term employee benefits
The Company's net obligation in respect of long-term employee benefits is the amount offuture benefit that employees have earned in return for their service in the current andprior periods. The obligation is measured by a periodical independent actuarial valuationusing the projected unit credit method. Re-measurement are recognised in Statement ofProfit and Loss in the period in which they arise
Fair value measurement
The Company measures financial assets at fair value at each balance sheet date. Fairvalue is the price that would be received to sell an asset or paid to transfer a liabilityin an orderly transaction between market participants at the measurement date. The fairvalue measurement is based on the presumption that the transaction to sell the asset ortransfer the liability takes place either:
oIn the principal market for the asset or liability or
oIn the absence of a principal market in the most advantageous market for the asset orliability 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 marketparticipants would use when pricing the asset or liability assuming that marketparticipants act in their economic best interest. A fair value measurement of anon-financial asset takes into account a market participant's ability to generate economicbenefits by using the asset in its highest and best use or by selling it to another marketparticipant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and forwhich sufficient data are available to measure fair value maximising the use of relevantobservable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in thefinancial statements are categorised within the fair value hierarchy described asfollows based on the lowest level input that is significant to the fair value measurementas a whole:
oLevel 1 - Quoted (unadjusted) market prices in active markets for identical assets orliabilities
oLevel 2 - Valuation techniques for which the lowest level input that is significant tothe fair value measurement is directly or indirectly observable
oLevel 3 - Valuation techniques for which the lowest level input that is significant tothe fair value measurement is Unobservable
For assets and liabilities that are recognised in the financial statements on arecurring basis the Company determines whether transfers have occurred between
levels in the hierarchy by re-assessing categorisation (based on the lowest level inputthat is significant to the fair value measurement as a whole) at the end of each reportingperiod.
The Company management determines the policies and procedures for recurring andnon-recurring fair value measurement. Involvement of external valuers is decided uponannually by Company management. The management decodes after discussion with externalvaluers about valuation technique and inputs to use for each case.
At each reporting date the Company's management analyses the movements in the valuesof assets and liabilities which are required to be re-measured or reassessed as per theCompany's accounting policies. For this analysis the Company verifies the major inputsapplied in the latest valuation by agreeing on the information in the valuationcomputation to contracts and other relevant documents.
The Company in conjunction with the Company's external valuers also compares thechange in the fair value of each asset and liability with relevant external sources todetermine whether the change is reasonable. For fair value disclosures the Company hasdetermined classes of assets and liabilities by the nature characteristics and risks ofthe asset or liability and the level of the fair value hierarchy as explained above.
Revenue is recognised to the extent it is probable that the economic benefits will flowto the Company and that the revenue can be reliably measured regardless of when thepayment is being made. Revenue is measured at the fair value of the consideration receivedor receivable taking into account contractually defined terms of payment and excludingtaxes or duties collected on behalf of the government. The Company assesses its revenuearrangements against specific criteria i.e. whether it has exposure to the significantrisks and rewards associated with the sale of goods or the rendering of services todetermine if it is acting as a principal or as an agent.
Revenue is recognised net of trade discounts goods and service tax or other taxes asapplicable.
(i) Sale of goods
Revenue from sale of goods is recognized in the statement of profit and loss when thesignificant risks and rewards in respect of ownership of goods have been transferred tothe buyer as per the terms of the respective sales order and the Company neithercontinuing managerial involvement to the degree usually associated with ownership noreffective control over the goods sold. Revenue from the sale of goods is measured at thefair value of the consideration received or receivable net of returns and allowances anddiscounts.
(ii) Interest income
For all financial assets measured either at amortised cost interest income is recordedusing the effective interest rate (EIR). EIR is the rate that exactly discounts theestimated future cash payments or receipts over the expected life of the financialinstrument or a shorter period where appropriate to the gross carrying amount of thefinancial asset or the amortised cost of a financial liability. When calculating theeffective interest rate the group estimates the expected cash flows by considering allthe contractual terms of the financial instrument (for example prepayment extensioncall and similar options) but does not consider the expected credit losses. Interestincome is included in other income in the statement of profit and loss.
(iii) Dividend income
Dividend income from investments is recognised when the right to receive the payment isestablished which is generally when shareholders approve the dividend.
Property Plant and Equipment & Depreciation
(i) Recognition and Measurement
Items of property plant and equipment are measured at cost less accumulateddepreciation and impairment losses if any. The cost of an item of property plant andequipment comprises - its purchase price including import duties and non-refundablepurchase taxes after deducting trade discounts and rebates. - Any costs are directlyattributable to bringing the asset to the location and condition necessary for it to becapable of operating in the manner intended by management. - the initial estimate of thecosts of dismantling and removing the item and restoring the site on which it is locatedthe obligation for which the Company incurs either when the item is acquired or as aconsequence of having used the item during a particular period for purposes other than toproduce inventories during that period. - Income and expenses related to the incidentaloperations not necessary to bring the item to the location and condition necessary for itto be capable of operating in the manner intended by management are recognised inStatement of Profit and Loss. If significant parts of an item of property plant andequipment have different useful lives then they are accounted for as separate items(major components) of property plant and equipment. Any gain or loss on disposal of anitem of property plant and equipment is recognised in Statement of Profit and Loss.Capital work-in-progress in respect of assets which are not ready for their intended useare carried at cost comprising of direct costs related incidental expenses andattributable interest.
(i) Subsequent Expenditure
Subsequent expenditure is capitalised only if it is probable that the future economicbenefits associated with the expenditure will flow to the Company.
The depreciable amount for assets is the cost of an asset or other amount substitutedfor cost less its estimated residual value. Depreciation on property plant and equipmentof the Company has been provided on the straight-line method as per the useful lifeprescribed in Schedule II to the Act except in
respect of the following categories of assets in whose case the life of the assets hasbeen assessed as under based on independent technical evaluation and management'sassessment thereof taking into account the nature of the asset the estimated usage ofthe asset the operating conditions of the asset past history of replacement anticipatedtechnological changes manufacturers warranties and maintenance support etc
Useful life is taken as per Schedule II of Companies Act 2013.
Depreciation method useful live and residual values are reviewed at each financialyear-end and adjusted if appropriate. Depreciation on additions (disposals) is provided ona pro-rata basis i.e. from (up to) the date on which asset is ready for use (disposedof).
(i) Recognition and Measurement:
Intangible assets are carried at cost less accumulated amortisation and impairmentlosses if any. The cost of an intangible asset comprises of its purchase price includingany import duties and other taxes (other than those subsequently recoverable from thetaxing authorities) and any directly attributable expenditure on making the asset readyfor its intended use. Expenditure on research and development eligible for capitalisationare carried as Intangible assets under development where such assets are not yet ready fortheir intended use
(ii) Subsequent Expenditure
Subsequent expenditure is capitalised only if it is probable that the future economicbenefits associated with the expenditure will flow to the Company.
Intangible assets are amortised over their estimated useful life on Straight LineMethod
The estimated useful lives of intangible assets and the amortization period arereviewed at the end of each financial year and the amortisation method is revised toreflect the changed pattern if any Non-current assets held for sale
Assets are classified as held for sale and stated at the lower of carrying amount andfair value fewer costs to sell if the asset is available for immediate sale and its saleis highly probable. Such assets or group of assets are presented separately in the BalanceSheet as "Assets Classified as Held for Sale". Once classified as held for saleintangible assets and property plant and equipment are no longer amortised ordepreciated.
Impairment of assets
The carrying values of assets/cash generating units at each balance sheet date arereviewed for impairment if any indication of impairment exists. The following intangibleassets are tested for impairment each financial year even if there is no indication thatthe asset is impaired:
i) an intangible asset that is not yet available for use; and
ii) an intangible asset that is having an indefinite useful life.
If the carrying amount of the assets exceeds the estimated recoverable amount animpairment is recognised for such excess amount. The impairment loss is recognised as anexpense in the Statement of Profit and Loss unless the asset is carried at revaluedamount in which case any impairment loss of the revalued asset is treated as arevaluation decrease to the extent a revaluation reserve is available for that asset. Therecoverable amount is the greater of the net selling price and their value in use. Thevalue in use is arrived at by discounting the future cash flows to their present valuebased on an appropriate discount factor. When there is indication that an impairment lossrecognized for an asset (other than a revalued asset) in earlier accounting periods nolonger exists or may have decreased such reversal of impairment loss is recognized in theStatement of Profit and Loss to the extent the amount was previously charged to theStatement of Profit and Loss. In the case of revalued assets such reversal is notrecognised.
Foreign Currency Transactions
Transactions in foreign currency are recorded at the approximate exchange rateprevailing on the date of transactions. Foreign currency monetary assets and monetaryliabilities not covered by forwarding exchange contracts are translated at year-endexchange rates and profit and loss so determined and realised exchange gains/losses arerecognised in purchase proceed of imports. The company has made PROFIT due to ForeignExchange Fluctuations (Purchase proceeds of imports) amounting to Rs. 2595060 during theyear.
Government Grants and Subsidies
The company recognises the Government grants only when there is reasonable assurancethat:
a) The enterprise will comply with the conditions attached to them and b) The grantwill be received.
During the year the company has not received any grant/subsidy.
Provisions and Contingent Liabilities
A provision is recognised when the Company has a present obligation as a result of pastevents and it is probable that an outflow of resources will be required to settle theobligation in respect of which a reliable estimate can be made. If the effect of the timevalue of money is material provisions are discounted using an appropriate discount ratethat reflects when appropriate the risks specific to the liability. When discounting isused the increase in the provision due to the passage of time is recognised as a financecost.
Contingent liabilities are disclosed in the Notes to the Standalone FinancialStatements. Contingent liabilities are disclosed for:
i) possible obligations which will be confirmed only by future events not wholly withinthe control of the Company or
ii) present obligations arising from past events where it is not probable that anoutflow of resources will be required to settle the obligation or a reliable estimate ofthe amount of the obligation cannot be made
Borrowing costs are interest and other costs that the Company incurs in connectionwith the borrowing of funds and is measured concerning the effective interest rate (EIR)applicable to the respective borrowing. Borrowing costs include interest costs measured atEIR and exchange differences arising from foreign currency borrowings to the extent theyare regarded as an adjustment to the interest cost.
Borrowing costs allocated to qualifying assets about the period from commencement ofactivities relating to construction/development of the qualifying asset up to the date ofcapitalisation of such asset are added to the cost of the assets. Capitalization ofborrowing costs is suspended and charged to the Statement of Profit and Loss duringextended periods when active development activity on the qualifying assets is interrupted.All other borrowing costs are recognised as an expense in the period which they areincurred.
Earnings per share
Basic earnings per share are computed by dividing the profit after tax by the weightedaverage number of equity shares outstanding during the year. The weighted average numberof equity shares outstanding during the year is adjusted for the events for bonus issuebonus element in a rights issue to existing shareholders share split and Diluted earningsper share is computed by dividing the profit/(loss) after tax as adjusted for dividendinterest and other charges to expense or income (net of any attributable taxes) relatingto the dilutive potential equity shares by the weighted average number of equity sharesconsidered for deriving basic earnings per share and the weighted average number of equityshares which could have been issued on conversion of all dilutive potential equity shares.
Insurance claims are accounted for by claims admitted/expected to be admitted and tothe extent that the amount recoverable can be measured reliably and it is reasonable toexpect the ultimate collection
Goods and Services tax input credit:
Goods and Services tax input credit is accounted for in the books in the period inwhich the underlying service received is accounted and when there is reasonable certaintyin availing/ utilising the credits
The Company operates in one reportable business segment i.e. "Manufacturing ofPlastic Pipes". Hence as per Ind AS 108 disclosers of the segment is not applicableto it.
Taxes on Income
Provision for current income taxes is made on taxable income at the rate applicable tothe relevant assessment year. Deferred taxes are recognised for future tax consequencesattributable to timings difference between the financial statements determination ofincome and their recognition for tax purpose. The effect on deferred tax assets andliabilities of a change in tax rates is recognised for tax purposes. The effect ondeferred tax assets and liabilities of a change in tax rates is recognised in Profit andLoss Account using the tax rates and tax laws that have been enacted or substantivelyenacted by balance sheet date.
Deferred tax assets are recognised and carried forward only to the extent that there isa virtual certainty of realisation of such assets. Considering this the company hasapplied for provision for deferred tax.