Bhaskar Agrochemicals Ltd. कंपली की लेखा नीति

Mar 31, 2025

1 Overview of the Company

Bhaskar Agrochemicals Limited (CIN NO. L24219TG1988PLC008331) was incorporated on February 19, 1988
in Hyderabad (Telangana). The Company is a public limited Company incorporated and domiciles in India and
has its registered office at D.No-1-90/C, Office Unit-608, 1 T0 6, 6th Floor Gowra Fountain Head, Madhapur
Shaikpet Hyderabad 500 081 TG. It''s shares are listed on the Bombay Stock Exchange. It has got the manufacturing
facility in Yadadri Bhuvanagiri District of Telangana, and is engaged in manufacturing mainly formulation of Agro
Chemicals.

The standalone financial statements are approved for issue by the Company''s Board of Directors on May 26,
2025.

2 Accounting policies

This note provides a list of the accounting policies adopted in the preparation of these standalone financial
Statement. These policies have been consistantly applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation and compliance with IND AS

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards
(''Ind AS'') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 read
with the Companies (Indian Accounting Standards) Amendment Rules, 2016 (as amended from time to time) and
other relevant provisions of the Act. Accounting policies have been consistently applied except where a newly
issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change
in the accounting policy hitherto in use. The material accouting policy information used in preparation of the
audited standalone financial statements have been discussed in the respective accounting policies mentioned
herebelow. The Standalone Financial statements have been prepared on an accrual basis under the historical
cost convention except for the following that are measured at fair value as required by relevant Ind AS.

> Certain financial assets and liabilities are measured at fair value (Referred accounting policy on financial
instruments)

> Defined benefit and other long term Employees Benefit.

Current versus non current classification

All the assets and liabilities have been classified as current and non current as per the Company''s normal operating
cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of services and
the time between the rendering of service and their realization in cash and cash equivalents, the Company has
ascertained its operating cycle as twelve months for the purpose of current and noncurrent classification of
assets and liabilities.

2.2 Uses of Estimates and judgments

The preparation of Financial Statements in conformity with the generally accepted accounting principles requires
management to make estimates and assumption that affect the reported amounts of assets and liabilities, revenue
and expenses, the accompanying disclosures and disclosure of contingent liabilities. The estimates and
assumptions used in accompanying financial statements are based upon management''s evaluation of the relevant
facts and circumstances as of the date of the financial statements are reviewed on an ongoing basis. Actual
results may differ from the estimates and assumptions used in preparing the accompanying financial statements.
Any revision to accounting estimates is recognised prospectively in current and future periods.Refer Note 2.21
for detailed discussion on Significant accounting judgments, estimates and assumptions.

2.3 Measurement of Fair Values

The accounting policies and disclosures require the measurement of fair values, for both financial and non¬
financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values, which includes
overseeing all significant fair value measurements, including Level 3 fair values by the management. The
management regularly reviews significant unobservable inputs and valuation adjustments. If third party information,
such as broker quotes or pricing services, is used to measure fair values, then the management assesses the
evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of

Ind AS, including the level in the fair value hierarchy in which such valuations should be classified. When measuring
the fair value of a financial asset or a financial liability, the Company uses observable market data as far as
possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the
valuation techniques as follows.

- Level 1 - Quoted price (unadjusted) in active markets for identical assets or liabilities

- Level 2 - inputs other than quoted price included in Level 1 that are observable for the assets or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices)

- Level 3 - inputs for the asset or liability that are not based on observable market data (unabsorvable inputs)

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value
hierarchy as the lowest level input that is significant to the entire measurement. The Company recognises transfers
between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

2.4 Property Plant and Equipment and Depreciation

a) Items of property, plant and equipment are measured at cost, which includes capitalised borrowing costs,
less accumulated depreciation and accumulated impairment losses, if any. Cost includes taxes, duties, freight
and other incidental expenses directly related to acquisition/construction and installation of the property, plant
and equipment. Any trade discounts and rebates are deducted in arriving at the purchase price.

b) Subsequent expenditure related to an item of property, plant and equipment are added to its book value only
if it is probable that the future benefits associated with the item will flow to the entity ;and the cost associated with
item can be measured reliably.

c) Capital work-in-progress includes property, plant and equipment not ready for their intended use and related
incidental expenses and attributable interest.

d) Expenditure during construction period:

Expenditure (direct & indirect) incurred during the construction period which are attributable to acquisition /construction
of PPE, will be capitalized with the respective Plant, Property & Equipment at the time of commissioning of such assets.

e) Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date
are disclosed as “Other Non-Current Assets”.

g) Depreciation on tangible property, plant and equipment has been provided on on Straight Line Method.
Depreciation is provided on a pro-rata basis, i.e. from the date on which asset is ready for use. Depreciation
method, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.

h) Items of property, plant and equipment that are held for disposal are stated at the lower of their net book value
and net realizable value and are shown separately under other current assets in the financial statements. Any
expected loss is recognized immediately in the Statement of Profit and Loss.

i) An item of property, plant and equipment is eliminated from the financial statements on disposal or when no
further benefit is expected from its use and disposal. Gains / losses arising from disposal are recognised in the
Statement of Profit and Loss.

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

2.5 Intangible Assets

a) Intangible assets are stated at cost of acquisition less accumulated amortisation and accumulated impairment
losses, if any.

b) Subsequent expenditure related to an item of intangible assets are added to its book value only if it is probable
benefits from the exisiting asset beyond its previously assessed standard of performance.

c) Intangible assets that are ready for use are amortized on a straight line basis over a period of estimated useful
life of 6 years.

The Company believes that the technically evaluated useful lives, different from Schedule II of the Companies
Act, 2013, best represent the period over which these assets are expected to be used.

d) An intangible asset is derecognised on disposal, or when no future economic benefits are expected from its
use or disposal. Gains or losses arising from derecognition of an item of intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of such item of intangible asset and are
recognised in the Statement of Profit and Loss when the asset is derecognised.

e) Intangible assets with finite lives are assessed for impairment whenever there is an indication that the intangible
asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite
useful life are reviewed at least at each financial year end.

2.6 Impairment of non-financial assets

The Company assesses at each year end whether there is any objective evidence that a non financial asset or
a group of non financial assets is impaired. If any such indication exists, the Company estimates the asset''s
recoverable amount and the amount of impairment loss.

An impairment loss is calculated as the difference between an asset''s carrying amount and recoverable amount.
Losses are recognized in Statement of Profit and Loss and reflected in an allowance account. When the Company
considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the
amount of impairment loss subsequently decreases and the decrease can be related objectively to an event
occurring after the impairment was recognised, then the previously recognised impairment loss is reversed through
Statement of Profit and Loss.

The recoverable amount of an asset or cash-generating unit (as defined below) is higher of an asset''s fair value
less costs of disposal and its value in use. The consequential amendments are made in Ind AS 105, Ind AS 16
and Ind AS 28., the estimated future cash flows are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money and the risks specific to the asset. For the
purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash
in flows from continuing use that are largely independent of the cash inflows of other assets or groups of assets
(the “cash-generating unit”).

2.7 Borrowing Costs

Borrowing cost directly attributable to acquisition and construction of qualifying assets (Qualifying asset is an
asset which necessarily takes substantial period to get ready to use or sale) should be capitalised as part of the
cost of such assets up to the date when such assets are ready for intended use or sale.

All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and
other costs that an entity incurs in connection with the borrowing of funds.

Borrowing costs are interest and other costs that the company incurs in connection with the borrowing of funds
and is measured with reference to the Effective Interest Rate (EIR) applicable to the respective borrowing.
Borrowing cost include interest costs measured at EIR.

2.8 Non Current Assets classified as held for sale

The Company classifies non-current assets (or disposal group) as held for sale if their carrying amounts will be
recovered principally through a sale rather than through continuing use.

The criteria for held for sale classification is regarded met only when the assets (or disposal group) is available for

immediate sale in its present condition, subject only to terms that are usual and customary for sales of such
assets (or disposal group), its sale is highly probable; and it will genuinely be sold, not abandoned. The Company
treats sale of the asset (or disposal group) to be highly probable when:

? The appropriate level of management is committed to a plan to sell the asset (or disposal group),

^ An active programmed to locate a buyer and complete the plan has been initiated (if applicable),

^ The asset (or disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value,

? The sale is expected to qualify for recognition as a completed sale within one year from the date of classification , and

? Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be
made or that the plan will be withdrawn.

Non-current assets (or disposal group) held for sale are measured “higher of an asset''s fair value less costs of
disposal and its value in use. Assets and liabilities (or disposal group) classified as held for sale are presented
separately in the balance sheet.

2.9 Inventories

a) Inventories are valued at lower of cost or net realizable value on an item-by-item basis.

b) Finished goods manufactured and work in progress are valued at the lower of cost and net realisable value.Cost
of finished goods and work in progress is determined by considering direct materials, labour costs, conversion
costs, including an appropriate share of fixed production overheads based on normal operating capacity and
other related costs incurred in bringing the inventories to their present condition and location.

b) Raw materials and packaging materials are valued at lower of cost and net realizable value. Cost includes
purchase price, freight inwards and other expenditure incurred in bringing such inventories to their present location
and condition. In determining the cost, first in forst out method is used.

c) Goods in transit are valued at cost which represents the cost incurred up to the stage at which the goods are in
transit.

d) Provision of obsolescence on inventories is considered on the basis of management''s estimate based on
demand and market of the inventories.

e) Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of
completion and the estimated costs necessary to make the sale.

2.10 Cash and Cash Equivalents

Cash comprises of cash at bank and on hand and cash equivalents comprise of short-term bank deposits with an
original maturity of three months or less.

Cash Flow Statement

Cash flows are reported using indirect method as set out in IND AS 7, “Statement of Cash Flows”, whereby profit
/(loss) before tax is adjusted for the effects of transactions of non cash nature and deferrals of accruals of past or
future cash receipts or payments. The cash flows from operating, Investing and financing activities of the Company
are segregated based on the available information.

2.11 Revenue Recognition

a) Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the
goods have passed to the buyer, usually on delivery of the goods. Revenue towards satisfaction of a performance
obligation is measured at the amount of transaction price (net of variable consideration) allocated to the performance
obligation. The transaction price of goods sold and services rendered is net off variable consideration on account
of various discounts and schemes offered by the company as a part of contract and taxes.

b) Revenue from rendering of services is recognised over time by measuring the progress towards complete
satisfaction of performance obligations at the reporting period.

c) Interest income is recognized on a time proportionate basis, taking into account the amount outstanding and
the rates applicable. For all financial instruments measured at amortized cost, interest income is recorded using
the effective interest rate method to the net carrying amount of the financial assets.

2.12 Income Tax

Income tax expense comprises current tax (i.e. amount of tax for the period determined in accordance with the
income tax law), deferred tax charge or credit (reflecting the tax effects of timing differences between accounting
income and taxable income for the period) and Minimum Alternate Tax (MAT) credit entitlement.

a) Current Tax

Current tax assets and liabilities are measured at the amount expected to be recovered or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively
enacted, at the year end date. Current tax assets and tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability
simultaneously.

b) Deferred Tax

“Deferred tax is recognised in respect of temporary difference between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable
profit will be available against which the deductible temporary differences, and the carry forward of unused tax
credits and unused tax losses can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be
utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the
extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other
comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction
either in Other Comprehensive Income (OCI) or directly in equity.

Deferred tax assets and liabilities are offset only if: a) The entity has a legally enforceable right to set off current
tax assets against current tax liabilities; and b) The deferred tax assets and the deferred tax liabilities relate to
income taxes levied by the same taxation authority on the same taxable entity.

c) Minimum Alternate Tax

MAT is recognised as an assets only when & to the extent there is convencing evidence that the Company will
pay normal income tax during the specified period. In the year in which the MAT credit became eligible to be
recognised, it is credited to the statement of profit & loss & is considered as (MAT credit entitlement). The
Company review the same at each Balance Sheet date & writes down the carrying amount of MAT credit entitlement
to the extent there is no longer convencing evidence to the effect that the comapny will pay normal income tax
during the specified period. MAT credits are in the form of unused tax credits that are carried forwared by the
Company for a specified period of time, hence, it is presented as Deferred Tax Assets.

2.13 Employees Benefits

a) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12
months after the end of the year in which the employees render the related service are recognized in respect of
employees'' services up to the end of the year and are measured at the amounts expected to be paid when the
liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

b) Other long-term employee benefit obligations

I. Defined contribution plans

Provident Fund: Contribution towards provident fund is made to the regulatory authorities, where the Company
has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does
not carry any further obligations, apart from the contributions made on a monthly basis which are charged to the
Statement of Profit and Loss. Employee''s State Insurance Scheme: Contribution towards employees'' state
insurance scheme is made to the regulatory authorities, where the Company has no further obligations. Such
benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations,
apart from the contributions made on a monthly basis which are charged to the Statement of Profit and Loss.

II. Defined benefit plans

Gratuity: The Company provides for gratuity, a defined benefit plan (the ''Gratuity Plan”) covering eligible employees
in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested
employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective
employee''s salary. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at
the end of each year. Actuarial losses/gains are recognized in the other comprehensive income in the year in
which they arise. The gratuity benefit is funded with the Life Insurance Corporation of India (LIC).

The Company recognizes the net obligation of a defined benefit plan in its Balance Sheet as an asset or liability.
Gains and losses through re-measurements of the net defined benefit liability/(asset)are recognized in other
comprehensiveincome and are not reclassified to profit or loss in subsequent periods.The actual return of the
portfolio of plan assets,in excess of the yields computed by applying the discount rate used to measure the
defined benefit obligation is recognized in other comprehensive income. The effect of any plan amendments is
recognized in net profit in the Statement of Profit and Loss
Compensated absences :

The short term provision for compensated absences has been calculated on actual basis, based on the balance
of unutilised leave available, and can be encashed at the end of the year as per the Company''s policy.

2.14 Foreign Currency Transactions

a) Functional and presentation currency

Initial recognition - Foreign currency transactions are recorded in the functional currency, by applying to the
foreign currency amount, the exchange rate between the functional currency and the foreign currency at the date
of the transaction.

The financial statements are presented in Indian rupee (INR), which is the Company''s functional and presentation currency.

b) Transactions and balances

On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount
the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/
Losses arising out of fluctuation in foreign exchange rate between the transaction date and settlement date are
recognised in the Statement of Profit and Loss.

All monetary assets and liabilities in foreign currencies are restated at the year end at the exchange rate prevailing
at the year end and the exchange differences are recognised in the Statement of Profit and Loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions.

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Mar 31, 2024

2 Accounting policies

This note provides a list of the accounting policies adopted in the preparation of these standalone financial Statement. These policies have been consistantly applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation and compliance with IND AS

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (''Ind AS'') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Amendment Rules, 2016 (as amended from time to time) and other relevant provisions of the Act. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. The material accouting policy information used in preparation of the audited standalone financial statements have been discussed in the respective accounting policies mentioned herebelow. The Standalone Financial statements have been prepared on an accrual basis under the historical cost convention except for the following that are measured at fair value as required by relevant Ind AS.

> Certain financial assets and liabilities are measured at fair value (Referred accounting policy on financial instruments)

> Defined benefit and other long term Employees Benefit.

Current versus non current classification

All the assets and liabilities have been classified as current and non current as per the Company''s normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of services and the time between the rendering of service and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as twelve months for the purpose of current and noncurrent classification of assets and liabilities.

2.2 Uses of Estimates and judgments

The preparation of Financial Statements in conformity with the generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities, revenue and expenses, the accompanying disclosures and disclosure of contingent liabilities. The estimates and assumptions used in accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements are reviewed on an ongoing basis. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revision to accounting estimates is recognised prospectively in current and future periods.Refer Note 2.24 for detailed discussion on Significant accounting judgments, estimates and assumptions.

2.3 Measurement of Fair Values

The accounting policies and disclosures require the measurement of fair values, for both financial and nonfinancial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values, which includes overseeing all significant fair value measurements, including Level 3 fair values by the management. The management regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then the management assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of

Ind AS, including the level in the fair value hierarchy in which such valuations should be classified. When measuring the fair value of a financial asset or a financial liability, the Company uses observable market data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

- Level 1 - Quoted price (unadjusted) in active markets for identical assets or liabilities

- Level 2 - inputs other than quoted price included in Level 1 that are observable for the assets or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

- Level 3 - inputs for the asset or liability that are not based on observable market data (unabsorvable inputs)

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

2.4 Property Plant and Equipment and Depreciation

a) Items of property, plant and equipment are measured at cost, which includes capitalised borrowing costs, less accumulated depreciation and accumulated impairment losses, if any. Cost includes taxes, duties, freight and other incidental expenses directly related to acquisition/construction and installation of the property, plant and equipment. Any trade discounts and rebates are deducted in arriving at the purchase price.

b) Subsequent expenditure related to an item of property, plant and equipment are added to its book value only if it is probable the future benefits associated with the item will flow to the entity ;and the cost associated with item can be measured reliably.

c) Capital work-in-progress includes property, plant and equipment not ready for their intended use and related incidental expenses and attributable interest.

d) Expenditure during construction period: Expenditure (direct & indirect) incurred during the construction period which are attributable to acquisition /construction of PPE, will be capitalized with the respective Plant, Property & Equipment at the time of commissioning of such assets.

e) Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as “Other Non-Current Assets”.

f) The estimated useful life of assets are as follows:

g) Depreciation on tangible property, plant and equipment has been provided on on Straight Line Method. Depreciation is provided on a pro-rata basis, i.e. from the date on which asset is ready for use. Depreciation method, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.

h) Items of property, plant and equipment that are held for disposal are stated at the lower of their net book value and net realizable value and are shown separately under other current assets in the financial statements. Any expected loss is recognized immediately in the Statement of Profit and Loss.

i) An item of property, plant and equipment is eliminated from the financial statements on disposal or when no further benefit is expected from its use and disposal. Gains / losses arising from disposal are recognised in the Statement of Profit and Loss.

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

2.5 Intangible Assets

a) Intangible assets are stated at cost of acquisition less accumulated amortisation and accumulated impairment losses, if any.

b) Subsequent expenditure related to an item of intangible assets are added to its book value only if it is probable benefits from the exisiting asset beyond its previously assessed standard of performance.

c) Intangible assets that are ready for use are amortized on a straight line basis over a period of estimated useful life of 6 years.

The Company believes that the technically evaluated useful lives, different from Schedule II of the Companies Act, 2013, best represent the period over which these assets are expected to be used.

d) An intangible asset is derecognised on disposal, or when no future economic benefits are expected from its use or disposal. Gains or losses arising from derecognition of an item of intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of such item of intangible asset and are recognised in the Statement of Profit and Loss when the asset is derecognised.

e) Intangible assets with finite lives are assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at each financial year end.

2.6 Impairment of non-financial assets

The Company assesses at each year end whether there is any objective evidence that a non financial asset or a group of non financial assets is impaired. If any such indication exists, the Company estimates the asset''s recoverable amount and the amount of impairment loss.

An impairment loss is calculated as the difference between an asset''s carrying amount and recoverable amount. Losses are recognized in Statement of Profit and Loss and reflected in an allowance account. When the Company considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, then the previously recognised impairment loss is reversed through Statement of Profit and Loss.

The recoverable amount of an asset or cash-generating unit (as defined below) is higher of an asset''s fair value less costs of disposal and its value in use. The consequential amendments are made in Ind AS 105, Ind AS 16 and Ind AS 28., the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash in flows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”).

2.7 Borrowing Costs

Borrowing cost directly attributable to acquisition and construction of qualifying assets (Qualifying asset is an asset which necessarily takes substantial period to get ready to use or sale) should be capitalised as part of the cost of such assets up to the date when such assets are ready for intended use or sale.

All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

Borrowing costs are interest and other costs that the company incurs in connection with the borrowing of funds and is measured with reference to the Effective Interest Rate (EIR) applicable to the respective borrowing. Borrowing cost include interest costs measured at EIR.

2.8 Non Current Assets classified as held for sale

The Company classifies non-current assets (or disposal group) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use.

The criteria for held for sale classification is regarded met only when the assets (or disposal group) is available for

immediate sale in its present condition, subject only to terms that are usual and customary for sales of such assets (or disposal group), its sale is highly probable; and it will genuinely be sold, not abandoned. The Company treats sale of the asset (or disposal group) to be highly probable when:

? The appropriate level of management is committed to a plan to sell the asset (or disposal group),

^ An active programmed to locate a buyer and complete the plan has been initiated (if applicable),

^ The asset (or disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value,

? The sale is expected to qualify for recognition as a completed sale within one year from the date of classification , and

? Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

Non-current assets (or disposal group) held for sale are measured “higher of an asset''s fair value less costs of disposal and its value in use. Assets and liabilities (or disposal group) classified as held for sale are presented separately in the balance sheet.

2.9 Inventories

a) Inventories are valued at lower of cost or net realizable value on an item-by-item basis.

b) Finished goods manufactured and work in progress are valued at the lower of cost and net realisable value.Cost of finished goods and work in progress is determined by considering direct materials, labour costs, conversion costs, including an appropriate share of fixed production overheads based on normal operating capacity and other related costs incurred in bringing the inventories to their present condition and location.

b) Raw materials and packaging materials are valued at lower of cost and net realizable value. Cost includes purchase price, freight inwards and other expenditure incurred in bringing such inventories to their present location and condition. In determining the cost, first in forst out method is used.

c) Goods in transit are valued at cost which represents the cost incurred up to the stage at which the goods are in transit.

d) Provision of obsolescence on inventories is considered on the basis of management''s estimate based on demand and market of the inventories.

e) Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and the estimated costs necessary to make the sale.

2.10 Cash and Cash Equivalents

Cash comprises of cash at bank and on hand and cash equivalents comprise of short-term bank deposits with an original maturity of three months or less.

Cash Flow Statement

Cash flows are reported using indirect method as set out in IND AS 7, “Statement of Cash Flows”, whereby profit /(loss) before tax is adjusted for the effects of transactions of non cash nature and deferrals of accruals of past or future cash receipts or payments. The cash flows from operating, Investing and financing activities of the Company are segregated based on the available information.

2.11 Revenue Recognition

a) Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods. Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration) allocated to the performance obligation. The transaction price of goods sold and services rendered is net off variable consideration on account of variousdiscounts and schemes offered by the company as a part of contract and taxes.

b) Revenue from rendering of services is recognised over time by measuring the progress towards complete satisfaction of performance obligations at the reporting period.

c) Interest income is recognized on a time proportionate basis, taking into account the amount outstanding and the rates applicable. For all financial instruments measured at amortized cost, interest income is recorded using the effective interest rate method to the net carrying amount of the financial assets.

2.12 Income Tax

Income tax expense comprises current tax (i.e. amount of tax for the period determined in accordance with the income tax law), deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the period) and Minimum Alternate Tax (MAT) credit entitlement.

a) Current Tax

Current tax assets and liabilities are measured at the amount expected to be recovered or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the year end date. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

b) Deferred Tax

“Deferred tax is recognised in respect of temporary difference between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in Other Comprehensive Income (OCI) or directly in equity.

Deferred tax assets and liabilities are offset only if: a) The entity has a legally enforceable right to set off current tax assets against current tax liabilities; and b) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.

c) Minimum Alternate Tax

MAT is recognised as an assets only when & to the extent there is convencing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit became eligible to be recognised, it is credited to the statement of profit & loss & is considered as (MAT credit entitlement). The Company review the same at each Balance Sheet date & writes down the carrying amount of MAT credit entitlement to the extent there is no longer convencing evidence to the effect that the comapny will pay normal income tax during the specified period. MAT credits are in the form of unused tax credits that are carried forwared by the Company for a specified period of time, hence, it is presented as Deferred Tax Assets.

2.13 Employees Benefits

a) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the year in which the employees render the related service are recognized in respect of employees'' services up to the end of the year and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

b) Other long-term employee benefit obligations

I. Defined contribution plans

Provident Fund: Contribution towards provident fund is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis which are charged to the Statement of Profit and Loss. Employee''s State Insurance Scheme: Contribution towards employees'' state insurance scheme is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis which are charged to the Statement of Profit and Loss.

II. Defined benefit plans

Gratuity: The Company provides for gratuity, a defined benefit plan (the ''Gratuity Plan”) covering eligible employees in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial losses/gains are recognized in the other comprehensive income in the year in which they arise. The gratuity benefit is funded with the Life Insurance Corporation of India (LIC).

Compensated absences :The short term provision for compensated absences has been calculated on actual basis, based on the balance of unutilised leave available, and can be encashed at the end of the year as per the Company''s policy.

2.14 Foreign Currency Transactions

a) Functional and presentation currency

Initial recognition - Foreign currency transactions are recorded in the functional currency, by applying to the foreign currency amount, the exchange rate between the functional currency and the foreign currency at the date of the transaction.

The financial statements are presented in Indian rupee (INR), which is the Company''s functional and presentation currency.

b) Transactions and balances

On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/ Losses arising out of fluctuation in foreign exchange rate between the transaction date and settlement date are recognised in the Statement of Profit and Loss.

All monetary assets and liabilities in foreign currencies are restated at the year end at the exchange rate prevailing at the year end and the exchange differences are recognised in the Statement of Profit and Loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.