Aastha Spintex Ltd. कंपली की लेखा नीति

Note 1: Company information

Aastha Spintex Limited (formerly known as Aastha Spintex Private Limited) is a public company domiciled in
India and incorporated under the provisions of the Companies Act, 2013. The company was converted from
private limited to public limited vide fresh certificate of incorporation dated 08/02/2025 with CIN:
L17120GJ2013PLC076361 issued by Registrar of Companies, CPC. During the year, the Company is engaged in
in the business of manufacturing and trading of Cotton Products.

Note 2: Summary of material accounting policies followed by the Company

These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS)
notified under section 133 of the Companies Act, 2013 (the ''Act'') read together with the Companies (Indian
Accounting Standards) Rules, 2015, as amended from time to time and other relevant provisions of the Act,
on an accrual basis.

The financial statements have been prepared on a historical cost basis.

The financial statements are presented in INR, which is also the Company''s functional currency, and all values
are rounded to the nearest Lacs (INR 00,000), except when otherwise indicated.

All assets and liabilities, other than deferred tax assets and liabilities, have been classified as current or non-
current as per the Company''s normal operating cycle and other criteria set out in the Schedule ill (Division II)
to the Act. Deferred tax assets and liabilities are classified as non-current assets and liabilities. Based on the
nature of business and the time between the acquisition of assets for processing and their realisation in cash
and cash equivalents, the Company has ascertained its operating cycle as 12 months for current and non-
current classification of assets and liabilities.

Basis of preparation and presentation :

The financial statement of the Company comprises of the statement of assets and liabilities as at 31 March
2026 and 31 March 2025, the statement of profit and loss (including other comprehensive income), the
statement of cash flows and the statement of changes in equity for Year ended 31 March 2026 and 31 March
2025 and the summary of significant accounting policies and explanatory notes and other explanatory
information (collectively, the "Financial Statements").

a) Key accounting estimates and judgments

In the preparation of financial statements, the Company makes judgments in the application of accounting
policies; and estimates and assumptions which affects the carrying values of assets and liabilities that are not
readily apparent from other sources. The estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant.

Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised and future periods affected. In particular,
information about significant areas of estimation uncertainty and critical judgments in applying accounting
policies that have the most significant effect on the amounts recognised in the financial statements are
included in the following notes:

i) Property, plant and equipment - useful life and impairment

ii) Recoverability/recognition of deferred tax assets

iii) Provision for expected credit losses of trade receivables

iii) Assets and obligations relating to employee benefits

iv) Provisions and contingent liabilities
V) Fair value of financial instruments.

b) Current / Non-Current Classification

The Company presents assets and liabilities in the balance sheet based on current and non-current
classification.

An asset is treated as current when it is:

a) Expected to be realised or intended to be sold or consumed in normal operating cycle;

b) Held primarily for the purpose of trading;

c) Expected to be realised within twelve months after the reporting period; or

d) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for
at least twelve months after the reporting period.

e) All other assets are classified as non-current.

A liability is treated as current when it is:

a) Expected to be settled in normal operating cycle;

b) Held primarily for the purpose of trading;

c) Due to be settled within twelve months after the reporting period; or

d) There is no unconditional right to defer the settlement of the liability for at least twelve months after
the reporting period.

e) All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash
and cash equivalents. The Company has determined its operating cycle, as explained in schedule III of the
Companies Act, 2013, as twelve months, having regard to the nature of business being carried out by the
Company. The same has been considered for classifying assets and liabilities as current and non-current while
preparing the financial statements.

c) Property, Plant and Equipment

All the items of property, plant and equipment are stated at cost, or deemed cost applied on transition to Ind
AS, net of recoverable taxes, trade discounts and rebates less accumulated depreciation and accumulated
impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable
to bringing the assets to its working condition for its intended use. Subsequent costs are included in the asset''s
carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future
economic benefits associated with the item will flow to the entity and the cost can be measured reliably. All
other expenses on existing fixed assets, including day-to-day repair and maintenance expenditure and cost of
replacing parts, are charged to the statement of profit and loss for the period during which such expenses are
incurred.

Property, Plant and Equipment which are significant to the total cost of that item of Property, Plant
and Equipment and having different useful life are accounted separately. Material items such as spare parts,
stand-by equipment and service equipment are classified as property, plant and equipment when they meet
the definition of property, plant and equipment as specified in Ind AS 16 — Property, Plant and Equipment.

Depreciation on Property, Plant and Equipment is provided on the straight-line method over the useful lives
of the assets estimated by the management. Depreciation is provided based on useful life of the assets as
prescribed in Schedule II to the Companies Act, 2013.

The residual values, useful lives and methods of depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted prospectively, if appropriate.

An item of property, plant and equipment and any significant part is derecognised upon disposal or when no
future economic benefits are expected from its use or disposal. Gains or losses arising from derecognition of
a Property, Plant and Equipment are measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognised in the Statement of Profit and Loss when the asset is
derecognized.

d) Segment reporting

Operating segments are identified based on the internal reports regularly reviewed by the management of the
Company, for allocating resources and assessing performance, in accordance with Ind AS 108 - Operating
Segments. Based on such review, the Company operates in a single reportable segment. Accordingly, separate
segment information is not presented.

e) Capital work in progress and Capital advances

Cost of assets not ready for intended use, as on the end of the reporting period, is shown as capital work in
progress.

Advances given towards acquisition of Property, Plant and Equipment outstanding at end of each reporting
period are disclosed as other non-current assets.

f) Intangible Assets

Intangible assets are included in the balance sheet when it is probable that associated future economic
benefits would flow to the Company. In this case they are measured initially at purchase cost and then
amortised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation
method are reviewed at the end of each reporting period, with the effect of any changes in estimate being
accounted for on a prospective basis.

Type of Assets Useful Life
Intangible Assets 5 Years

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the
net disposal proceeds and the carrying amount of the asset and are recognized in the Restated Statement of
Profit and Loss when the asset is derecognized.

g) Impairment

At each balance sheet date, the Company reviews the carrying value of its property, plant and equipment and
intangible assets to determine whether there is any indication that the carrying value of those assets may not
be recoverable through continuing use. If any such indication exists, the recoverable amount of the asset is
reviewed in order to determine the extent of impairment loss, if any. Where the asset does not generate cash
flows that are independent from other assets, the Company estimates the recoverable amount of the Cash
Generating Unit (CGU) to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell or value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of
future cash flows have not been adjusted. An impairment loss is recognised in the statement of profit and loss
as and when the carrying value of an asset exceeds its recoverable amount.

Where an impairment loss subsequently reverses, the carrying value of the asset {or cash generating unit) is
increased to the revised estimate of its recoverable amount so that the increased carrying value does not
exceed the carrying value that would have been determined had no impairment loss been recognised for the
asset {or cash generating unit) in prior years. A reversal of an impairment loss is recognised in the statement
of profit and loss immediately.

h)Leases

The Company accounts for leases in accordance with Ind AS 116 - Leases.

Identification of a lease

At inception of a contract, the Company assesses whether the contract is, or contains, a lease. A contract is,
or contains, a lease if it conveys the right to control the use of an identified asset for a period of time in
exchange for consideration. Control exists where the Company has both the right to obtain substantially all of
the economic benefits from use of the identified asset and the right to direct its use throughout the period of

use.

The Company as a lessee

At the commencement date of a lease, the Company recognises a right-of-use asset and a corresponding lease
liability, other than for leases to which the recognition exemptions below are applied.

The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, where that rate cannot be
readily determined, the Company''s incremental borrowing rate. Lease payments comprise fixed payments
(including in-substance fixed payments) less any lease incentives receivable, variable payments that depend
on an index or rate, amounts expected to be payable under residual value guarantees, the exercise price of a
purchase option that the Company is reasonably certain to exercise, and payments of penalties for terminating
the lease where the lease term reflects that option being exercised. Variable lease payments that do not
depend on an index or rate are recognised as an expense in the period in which the event or condition giving
rise to the payment occurs.

The lease liability is subsequently measured at amortised cost using the effective interest method, being
increased by the interest accretion and reduced by lease payments made. It is remeasured where there is a
change in the lease term, a change in the assessment of a purchase option, a change in future lease payments
arising from a change in an index or rate, or a change in the amount expected to be payable under a residual
value guarantee, with a corresponding adjustment to the right-of-use asset.

The right-of-use asset is initially measured at cost, comprising the initial measurement of the lease liability,
any lease payments made at or before the commencement date less lease incentives received, initial direct
costs, and an estimate of the costs of dismantling and removing the underlying asset or restoring the site. It is
subsequently measured at cost less accumulated depreciation and any accumulated impairment losses,
adjusted for any remeasurement of the lease liability.

Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the
estimated useful life of the underlying asset. Where the lease transfers ownership of the underlying asset by
the end of the lease term, or the cost of the right-of-use asset reflects that a purchase option will be exercised,
depreciation is provided over the useful life of the underlying asset. Right-of-use assets are tested for
impairment in accordance with the policy at.Note 2(g).

Determining the lease term

The lease term comprises the non-cancellable period of the lease, together with periods covered by an option
to extend where the Company is reasonably certain to exercise that option, and periods covered by an option
to terminate where the Company is reasonably certain not to exercise it. The assessment is reviewed where a
significant event or change in circumstances within the Company''s control occurs.

Recognition exemptions

The Company applies the recognition exemptions available under Ind AS 116 for short-term leases (a lease
term of twelve months or less at the commencement date, containing no purchase option) and for leases of
low-value assets. Lease payments on such leases are recognised as an expense on a straight-line basis over
the lease term, or on another systematic basis where that is more representative of the pattern of benefit.

Separating components

Where a contract contains lease and non-lease components, the Company allocates the consideration on the
basis of relative stand-alone prices, unless it elects, by class of underlying asset, not to separate non-lease
components and instead to account for the lease and associated non-lease components as a single lease
component.

The Company as a lessor

Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership
of an asset are classified as operating leases; all other leases are classified as finance leases. Rental income
from operating leases is recognised on a straight-line basis over the lease term and is included in other income.
Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount
of the leased asset and recognised over the lease term on the same basis as rental income.

Presentation

Right-of-use assets and lease liabilities are presented separately on the face of the Balance Sheet, with lease
liabilities analysed between current and non-current. Depreciation on right-of-use assets is included within
depreciation and amortisation expense, and interest on lease liabilities within finance costs. In the Statement
of Cash Flows, cash payments for the principal portion of lease liabilities are presented within financing
activities; the interest portion is presented consistently with other interest paid; and payments in respect of
short-term leases, leases of low-value assets and variable lease payments not included in the measurement
of lease liabilities are presented within operating activities.

i) Cash and Cash Equivalents

Cash and cash equivalents comprise of cash on hand, cash at banks, short-term deposits and shortterm, highly
liquid investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value.