Cemindia Projects Ltd. कंपली की लेखा नीति

Mar 31, 2025

Judgements include considerations of inputs such
as expected earnings in future years, liquidity risk,
credit risk and volatility. Changes in assumptions
about these factors could affect the reported fair
value of these investments.

c. Deferred tax assets

I n assessing the realisability of deferred income
tax assets, management considers whether some
portion or all of the deferred income tax assets will
not be realised. The ultimate realisation of deferred
income tax assets is dependent upon the generation
of future taxable income during the periods in which
the temporary differences become deductible.
Management considers the scheduled reversals
of deferred income tax liabilities, projected future
taxable income and tax planning strategies in making
this assessment. Based on the level of historical
taxable income and projections for future taxable
income over the periods in which the deferred
income tax assets are deductible, management
believes that the Company will realise the benefits
of those deductible differences. The amount of the
deferred income tax assets considered realisable,
however, could be reduced in the near term if
estimates of future taxable income during the carry
forward period are reduced.

d. Defined benefit plans

The cost and present value of the gratuity obligation
and compensated absences are determined using
actuarial valuations. An actuarial valuation involves
making various assumptions that may differ from
actual developments in the future. These include
the determination of the discount rate, future salary
increases, attrition rate and mortality rates. Due to
the complexities involved in the valuation and its
long-term nature, a defined benefit obligation is
highly sensitive to changes in these assumptions.
All assumptions are reviewed at each reporting date.

e. Leases

The Company evaluates if an arrangement qualifies
to be a lease as per the requirements of Ind AS
116. Identification of a lease required significant
judgement. The Company uses significant
judgement in assessing the lease term (including
anticipated renewals) and the applicable discount
rate. The Company revises the lease term if there is
a change in non-cancellable period of a lease.

f. Useful lives of property, plant and equipment and
intangible assets

The charge in respect of periodic depreciation is
derived after determining an estimate of an asset''s

expected useful life and the expected residual value
at the end of its life. The useful lives and residual
values of assets are determined by the management
at the time of acquisition of asset and reviewed
periodically, including at each financial year. The lives
are based on historical experience with similar assets
as well as anticipation of future events, which may
impact their life, such as changes in technology.

g. Provisions and contingent liabilities

A provision is recognised when the Company has
a present obligation as result of a past event and
it is probable that the outflow of resources will be
required to settle the obligation, in respect of which
a reliable estimate can be made. These are reviewed
at each balance sheet date and adjusted to reflect
the current best estimates. Contingent liabilities
are not recognised in the financial statements.
Contingent assets are disclosed where an inflow of
economic benefits is probable.

v. Fair value measurement

The Company measures financial instruments, at fair
value at each balance sheet date. (Refer note 37)

Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

¦ In the principal market for the asset or liability, or

¦ In the absence of a principal market, In the most
advantageous market for the asset or liability.

The principal or the most advantageous market must
be accessible by the Company.

The fair value of an asset or a liability is measured
using the assumptions that market participants
would use when pricing the asset or liability,
assuming that market participants act in their
economic best interest.

A fair value measurement of a non-financial asset
takes into account a market participant''s ability to
generate economic benefits by using the asset in
its highest and best use or by selling it to another
market participant that would use the asset in its
highest and best use.

The Company uses valuation techniques that are
appropriate in the circumstances and for which
sufficient data is available to measure fair value,
maximising the use of relevant observable inputs and
minimising the use of unobservable inputs. All assets
and liabilities for which fair value is measured or

disclosed in the financial statements are categorisec
within the fair value hierarchy, described as follows
based on the lowest level input that is significant to
the fair value measurement as a whole:

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

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

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

For assets and liabil ities that are recog nised in
the financial statements on a recurring basis, the
Company determines whether transfers have
occurred between levels in the hierarchy by
re-assessing categorisation (based on the lowes
level input that is significant to the fair value
measurement as a whole) at the end of each
reporting period.

At each reporting date, the Management analyse
the movements in the values of assets and liabilities
which are required to be remeasured or re-assessed
as per the Company''s accounting policies. For this
analysis, the Management verifies the major inputs
applied in the latest valuation by agreeing the
information in the valuation computation to
contracts and other relevant documents.

The Management also compares the change
in the fair value of each asset and liability with
relevant external sources to determine whether the
change is reasonable.

For the purpose of fair value disclosures, the
Company has determined classes of assets and
liabilities on the basis of the nature, characteristic
and risks of the asset or liability and the level of the
fair value hierarchy as explained above. This note
summarises accounting policy for fair value.

Other fair value related disclosures are given in the
relevant notes.

¦ Disclosures for valuation methods, significani
estimates and assumptions (notes 36
39, 40 and 41).

¦ Financial instruments (including those carried
at amortised cost) (notes 6, 11, 12, 13, 18, 19
21, 22, and 23).

¦ Quantitative disclosure of fair value measurement
hierarchy (note 37).

vi. Property, Plant and Equipment (Tangible
assets)

Property, Plant and Equipment is stated at cost
of acquisition, including expenditure directly
attributable to the acquisition or construction of
asset to bring it in working condition for intended
use, if any, till the date of acquisition/ installation
of the assets less accumulated depreciation and
accumulated impairment losses, if any.

The Company has elected to regard previous GAAP
carrying values of property, plant and equipment as
deemed cost at the date of transition to Ind AS i.e.
January 1, 2016.

Subsequent expenditure relating to Property, Plant
and Equipment is capitalised only when it is probable
that future economic benefits associated with the
item will flow to the Company and the cost of the
item can be measured reliably. When significant
component of the asset is replaced, it is depreciated
separately based on specific useful life. All other
repairs and maintenance costs are charged to the
Statement of Profit and Loss as incurred. The cost
and related accumulated depreciation are eliminated
from the financial statements, either on disposal
or when retired from active use and the resultant
gain or loss are recognised in the Statement of
Profit and Loss.

vii. Capital work-in-progress

Capital work-in-progress, representing expenditure
incurred in respect of assets under development
and not ready for their intended use, are carried at
cost. Cost includes related acquisition expenses,
construction cost and other direct expenditure net
of accumulated impairment, if any.

viii. Intangible Assets

Intangible assets are stated at cost, only when
it is probable that future economic benefits
associated with the item will flow to the Company
and the cost of the item can be measured reliably,
less accumulated amortisation and accumulated
impairment losses, if any.

I ntangible assets mainly comprise of license fees
and implementation cost for software and other
application software acquired for in-house use.

ix. Depreciation and amortisation

Depreciation is provided for property, plant and equipment so as to expense the cost less residual value over their
estimated useful lives on a straight line basis. Intangible assets are amortised from the date they are available
for use, over their estimated useful lives. The estimated useful lives are as mentioned below:

The estimated useful life and residual values are
reviewed at each financial year end and the effect
of any change in the estimates of useful life/residual
value is accounted on prospective basis.

An asset''s carrying amount is written down
immediately to its recoverable amount if the asset''s
carrying amount is greater than its estimated
recoverable amount.

Depreciation on additions is provided on a pro-rata
basis, from the date on which asset is ready to use.

Gains and losses on disposals are determined by
comparing proceeds with carrying amount. These are
accounted in the Statement of Profit and Loss under
Other income and Other expenses.

Purchase of furniture fixtures & office equipments at
project sites are charged off in the year of acquisition.

x. Financial Instruments

A financial instrument is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.

a. Financial Assets

(i) Initial Recognition

In the case of financial assets, not recorded at fair
value through profit or loss (FVPL), financial assets
are recognised initially at fair value plus transaction

costs that are directly attributable to the acquisition
of the financial asset. Purchases or sales of financial
assets that require delivery of assets within a time
frame established by regulation or convention in the
market place (regular way trades) are recognised
on the trade date i.e., the date that the Company
commits to purchase or sell the asset.

(ii) Subsequent Measurement

For purposes of subsequent measurement, financial
assets are classified in following categories:

Financial Assets at Amortised Cost

Financial assets are subsequently measured at
amortised cost if these financial assets are held
within a business model with an objective to hold
these assets in order to collect contractual cash
flows and the contractual terms of the financial
asset give rise on specified dates to cash flows that
are solely payments of principal and interest on the
principal amount outstanding. Interest income from
these financial assets is included in finance income
using the effective interest rate ("EIR") method.
Impairment gains or losses arising on these assets
are recognised in the Statement of Profit and Loss.

Financial Assets Measured at Fair Value

Financial assets are measured at fair value through
Other Comprehensive Income (''OCI'') if these financial
assets are held within a business model with an

objective to hold these assets in order to collect
contractual cash flows or to sell these financial
assets and the contractual terms of the financial
asset give rise on specified dates to cash flows
that are solely payments of principal and interest
on the principal amount outstanding. Movements in
the carrying amount are taken through OCI, except
for the recognition of impairment gains or losses,
interest revenue and foreign exchange gains and
l osses which are recognised in the Statement of
Profit and Loss.

Financial asset not measured at amortised cost or at
fair value through OCI is carried at FVPL.

(iii) Impairment of Financial Assets

In accordance with Ind AS 109, the Company
applies the Expected Credit Loss ("ECL") model for
measurement and recognition of impairment loss on
financial assets and credit risk exposures.

The Company follows ''simplified approach'' for
recognition of impairment loss allowance on trade
receivables. Simplified approach does not require
the Company to track changes in credit risk.
Rather, it recognises impairment loss allowance
based on lifetime ECL at each reporting date, right
from its initial recognition.

For recognition of impairment loss on other financial
assets and risk exposure, the Company determines
that whether there has been a significant increase in
the credit risk since initial recognition. If credit risk
has not increased significantly, 12-month ECL is used
to provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then
the entity reverts to recognising impairment loss
allowance based on 12-month ECL.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance
with the contract and all the cash flows that the
entity expects to receive (i.e., all cash shortfalls),
discounted at the original EIR. Lifetime ECL are the
expected credit losses resulting from all possible
default events over the expected life of a financial
instrument. The 12-month ECL is a portion of the
lifetime ECL which results from default events
that are possible within 12 months after the
reporting date.

ECL impairment loss allowance (or reversal) during
the period is recognised as income/expense in the
Statement of Profit and Loss.

(iv) De-recognition of Financial Assets

The Company de-recognises a financial asset only
when the contractual rights to the cash flows from
the asset expire, or it transfers the financial asset
and substantially all risks and rewards of ownership
of the asset to another entity.

If the Company neither transfers nor retains
substantially all the risks and rewards of ownership
and continues to control the transferred asset, the
Company recognises its retained interest in the
assets and an associated liability for amounts it
may have to pay.

If the Company retains substantially all the risks and
rewards of ownership of a transferred financial asset,
the Company continues to recognise the financial
asset and also recognises a collateralised borrowing
for the proceeds received.

On derecognition of a financial asset in its entirety,
the difference between the carrying amount at the
date of derecognition and the consideration received
is recognised in profit or loss.

b. Equity Instruments and Financial Liabilities

Financial liabilities and equity instruments issued
by the Company are classified according to the
substance of the contractual arrangements entered
into and the definitions of a financial liability and an
equity instrument.

(i) Equity Instruments

An equity instrument is any contract that evidences
a residual interest in the assets of the Company after
deducting all of its liabilities. Equity instruments
which are issued for cash are recorded at the proceeds
received, net of direct issue costs. Equity instruments
which are issued for consideration other than cash
are recorded at fair value of the equity instrument.

(ii) Financial Liabilities
- Initial Recognition

Financial liabilities are classified, at initial recognition,
as financial liabilities at FVPL, loans and borrowings
and payables as appropriate. All financial liabilities
are recognised initially at fair value and, in the case
of loans and borrowings and payables, net of directly
attributable transaction costs.

- Subsequent Measurement

The measurement of financial liabilities depends on
their classification, as described below:

- Financial liabilities at FVPL

Financial liabilities at FVPL include financial
liabilities held for trading and financial liabilities
designated upon initial recognition as at FVPL.
Financial liabilities are classified as held for trading
if they are incurred for the purpose of repurchasing
in the near term. Gains or losses on liabilities held
for trading are recognised in the Statement of
Profit and Loss.

Financial guarantee contracts issued by the
Company are those contracts that require a payment
to be made to reimburse the holder for a loss it
incurs because the specified debtor fails to make
a payment when due in accordance with the terms
of a debt instrument. Financial guarantee contracts
are recognised initially as a liability at fair value,
adjusted for transaction costs that are directly
attributable to the issuance of the guarantee.
Subsequently, the liability is measured at the higher
of the amount of loss allowance determined as per
impairment requirements of Ind AS 109 and the
amount recognised less cumulative amortisation.
Amortisation is recognised as finance income in the
Statement of Profit and Loss.

- Financial liabilities at amortised cost

After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortised cost using the EIR method. Any difference
between the proceeds (net of transaction costs)
and the settlement or redemption of borrowings is
recognised over the term of the borrowings in the
Statement of Profit and Loss.

Amortised cost is calculated by taking into account
any discount or premium on acquisition and fees or
costs that are an integral part of the EIR. The EIR
amortisation is included as finance costs in the
Statement of Profit and Loss.

- Derivative financial instruments

The Company uses derivative financial instruments
i.e. foreign exchange forward and options contracts
to manage its exposure to foreign exchange
risks. Such derivative financial instruments are
initially recognised at fair value on the date on
which a derivative contract is entered into and are
subsequently re-measured at fair value. The Company
uses hedging instruments that are governed by the
policies of the Company.

- Hedge Accounting

The Company uses foreign currency forward and
options contracts to hedge its foreign currency
risks which are initially recognised at fair value
on the date a derivative contract is entered into
and are subsequently remeasured at their fair
value with changes in fair value recognised in the
Standalone Statement of Profit and Loss in the
period when they arise.

- De-recognition of Financial Liabilities

Financial liabilities are de-recognised when the
obligation specified in the contract is discharged,
cancelled or expired. When an existing financial
liability is replaced by another from the same lender
on substantially different terms, or the terms of
an existing liability are substantially modified,
such an exchange or modification is treated as
de-recognition of the original liability and recognition
of a new liability. The difference in the respective
carrying amounts is recognised in the Statement of
Profit and Loss.

c. Offsetting Financial Instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the Balance Sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis to realise the assets and settle
the liabilities simultaneously.

xi. Employee Benefits

a. Defined Contribution Plan

Contributions to defined contribution schemes
such as superannuation scheme, employees''
state insurance, labour welfare are charged as an
expense based on the amount of contribution
required to be made as and when services are
rendered by the employees. The above benefits are
classified as Defined Contribution Schemes as the
Company has no further obligations beyond the
monthly contributions.

b. Defined Benefit Plan

I n respect of certain employees, provident fund
contributions are made to a trust administered by the
Company. The interest rate payable to the members
of the trust shall not be lower than the statutory
rate of interest declared by Central Government
under Employees Provident Fund and Miscellaneous
Provisions Act, 1952 and shortfall, if any, shall be
made good by the Company. The contribution
paid or payable including the interest shortfall,
if any, is recognised as an expense in the period

in which services are rendered by the employee.
Accordingly the Provident Fund is treated as a defined
benefit plan. Further, the pattern of investments for
investible funds is as prescribed by the Government.
Accordingly, other related disclosures in respect of
provident fund have not been made.

The Company also provides for gratuity which is
a defined benefit plan, the liabilities of which is
determined based on valuations, as at the balance
sheet date, made by an independent actuary using
the projected unit credit method. Re-measurement,
comprising of actuarial gains and losses, in respect
of gratuity are recognised in the OCI, in the period
in which they occur. Re-measurement recognised in
OCI are not reclassified to the Statement of Profit
and Loss in subsequent periods. Past service cost is
recognised in the Statement of Profit and Loss in the
year of plan amendment or curtailment.

c. Leave entitlement and compensated absences

Accumulated leave which is expected to be utilised
within next twelve months, is treated as short-term
employee benefit. Leave entitlement, other than
short term compensated absences, are provided
based on a actuarial valuation, similar to that of
gratuity benefit. Re-measurement, comprising
of actuarial gains and losses, in respect of leave
entitlement are recognised in the Statement of
Profit and Loss in the period in which they occur.

d. Short-term Benefits

Short-term employee benefits such as salaries,
wages, performance incentives etc. are recognised
as expenses at the undiscounted amounts
in the Statement of Profit and Loss of the
period in which the related service is rendered.
Expenses on non-accumulating compensated
absences is recognised in the period in which the
absences occur.

xii. Inventories

a. The stock of construction materials, stores,
spares and embedded goods and fuel is valued
at cost or net realisable value, whichever is
lower. However, these items are considered to
be realisable at cost if the finished products
in which they will be used, are expected to
be sold at or above cost. Cost is determined
on weighted average basis and includes all
applicable cost of bringing the goods to their
present location and condition.

b. Spares that are of regular use are charged
to the statement of profit and loss as
and when consumed.

xiii. Cash and Cash Equivalents

Cash and cash equivalents in the Balance Sheet
comprises of cash at banks and on hand and
short-term deposits with an original maturity of three
month or less, which are subject to an insignificant
risk of changes in value.

xiv. Segment Reporting

Operating segments are reported in a manner
consistent with the internal reporting provided
to the chief operating decision maker. The chief
operating decision maker regularly monitors and
reviews the operating result of the whole Company
as one segment of "Construction". Thus, as defined
in Ind AS 108 "Operating Segments”, the Company''s
entire business falls under this one operational
segment and hence the necessary information has
already been disclosed in the Balance Sheet and the
Statement of Profit and Loss.

xv. Foreign Exchange Translation of Foreign
Projects and Accounting of Foreign Exchange
Transaction

a. Initial Recognition

Foreign currency transactions are initially recorded
in the reporting currency, by applying to the foreign
currency amount the exchange rate between the
reporting currency and the foreign currency at the
date of the transaction.

b. Conversion

Monetary assets and liabilities denominated in
foreign currencies are reported using the closing rate
at the reporting date. Non-monetary items which are
carried in terms of historical cost denominated in a
foreign currency are reported using the exchange
rate at the date of the transaction.

c. Treatment of Exchange Difference

Exchange differences arising on settlement/
restatement of foreign currency monetary assets and
liabilities of the Company are recognised as income
or expense in the Statement of Profit and Loss.

xvi. Revenue Recognition

a. Contract Revenue

The Company derives revenues primarily from
providing construction services.

Revenue from construction services, where the
performance obligations are satisfied over time and
where there is no uncertainty as to measurement
or collectability of consideration, is recognised
as per the percentage-of-completion method.
The percentage-of-completion of a contract is
determined by the proportion that contract costs
incurred for work performed upto the reporting
date bear to the estimated total contract costs.
When there is uncertainty as to measurement
or ultimate collectability, revenue recognition is
postponed until such uncertainty is resolved.

Contract revenue earned in excess of certification
are classified as contract assets (which we refer
as unbilled revenue) while certification in excess
of contract revenue are classified as contract
liabilities (which we refer to as due to customer).
Advance payments received from contractee for
which no services are rendered are presented
as ''Advance from contractee''. Impairment loss is
recognised on account of credit risk in respect of a
contract asset using expected credit loss model on
similar basis as applicable to trade receivables.

Due to the nature of the work required to be
performed on many of the performance obligations,
the estimation of total revenue and cost of completion
is complex, subject to many variables and requires
significant judgement. Variability in the transaction
price arises primarily due to liquidated damages,
price variation clauses, changes in scope, incentives,
if any. The Company considers its experience with
similar transactions and expectations regarding
the contract in estimating the amount of variable
consideration to which it will be entitled and
determining whether the estimated variable
consideration should be constrained. The Company
includes estimated amounts in the transaction
price to the extent it is probable that a significant
reversal of cumulative revenue recognised will not
occur when the uncertainty associated with the
variable consideration is resolved. The estimates
of variable consideration are based largely on an
assessment of anticipated performance and all
information (historical, current and forecasted) that
is reasonably available.

Contract modifications are accounted for when
additions, deletions or changes are approved either to
the contract scope or contract price. The accounting
for modifications of contracts involves assessing
whether the services added to an existing contract
are distinct and whether the pricing is at the
standalone selling price. Services added that are not
distinct are accounted for on a cumulative catch up

basis, while those that are distinct are accounted
for prospectively, either as a separate contract, if
the additional services are priced at the standalone
selling price, or as a termination of the existing
contract and creation of a new contract if not priced
at the standalone selling price.

The Company presents revenues net of indirect taxes
in its Statement of Profit and Loss.

Costs to obtain a contract which are incurred
regardless of whether the contract was obtained
are charged-off in Statement of Profit and
Loss immediately in the period in which such
costs are incurred.

b. Share of profit and loss from unincorporated

entities in the nature of Subsidiary, Joint Venture
or Joint Operations

In case of Unincorporated Entities in the nature of
subsidiary / joint venture, share of profit and loss
are recognised in the Statement of Profit and Loss
as and when the right to receive the profit share or
obligation to settle the loss is established.

I n case of Unincorporated Entities in the nature
of a Joint Operation; the Company recognises its
direct right to the assets, liabilities, contingent
liabilities, revenues and expenses of joint operations
and its share of any jointly held or incurred assets,
liabilities, revenues and expenses. These have been
incorporated in the financial statements under the
appropriate headings.

xvii. Other Income

a. Interest Income

I nterest income is accrued on a time proportion
basis, by reference to the principal outstanding and
the applicable Effective Interest Rate (EIR).

b. Other Income

Other items of income are accounted as and when
the right to receive such income arises and it is
probable that the economic benefits will flow to
the Company and the amount of income can be
measured reliably.

xviii. Income Taxes

Income tax expense comprises of current tax expense
and the net change in the deferred tax asset or
liability during the period. Current and deferred taxes
are recognised in the Statement of Profit and Loss,
except when they relate to items that are recognised
in other comprehensive income or directly in equity,
in which case, the current and deferred tax are

also recognised in other comprehensive income or
directly in equity, respectively.

a. Current Taxes

Current income tax is recognised based on the
estimated tax liability computed after taking credit
for allowances and exemptions in accordance
with the Income Tax Act, 1961. Current income tax
assets and liabilities are measured at the amount
expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used
to compute the amount are those that are enacted
or substantively enacted, at the reporting date.

b. Deferred Taxes

Deferred tax is determined by applying the Balance
Sheet approach. Deferred tax assets and liabilities are
recognised for all deductible temporary differences
between the financial statements'' carrying amount
of existing assets and liabilities and their respective
tax base. Deferred tax assets and liabilities are
measured using the enacted tax rates or tax rates
that are substantively enacted at the Balance Sheet
date. The effect on deferred tax assets and liabilities
of a change in tax rates is recognised in the period
that includes the enactment date. Deferred tax
assets are only recognised to the extent that it is
probable that future taxable profits will be available
against which the temporary differences can be
utilised. Such assets are reviewed at each Balance
Sheet date to reassess realisation.

Deferred tax assets and liabilities are offset when
there is a legally enforceable right to offset current
tax assets and liabilities. 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 realise the asset and settle
the liability simultaneously.

xix. Leases

The Company''s lease asset classes primarily consist
of leases for land, building and plant and equipment.
The Company assesses whether a contract contains
a lease, at inception of a contract. A contract is, or
contains, a lease if the contract conveys the right to
control the use of an identified asset for a period of
time in exchange of the consideration.

At the date of the commencement of the lease,
the Company recognises a right-of-use asset
representing its right to use the underlying asset
for the lease term and a corresponding lease
liability for all the lease arrangements in which it
is a lease, except for leases with a term of twelve

months or less (short-term leases) and low value
leases. For these short-term and low value leases,
the Company recognises the lease payments as an
operating expense on a straight-line basis over the
term of the lease.

The right-of-use assets are initially recognised at
cost, which comprises the initial amount of the
lease liability adjusted for any lease payments
made at or prior to the commencement date of
the lease. They are subsequently measured at cost
less accumulated depreciation and impairment
losses. Right-of-use assets are depreciated from the
commencement date on a straight-line basis over
the shorter of the lease term and useful life of the
underlying asset. The estimated useful life of the
assets are determined on the same basis as those
of property, plant and equipment.

Right-of-use assets are evaluated for recoverability
whenever events or changes in circumstances
indicate that their carrying amounts may not be
recoverable. Carrying amount of right-of-use asset is
written down immediately to its recoverable amount
if the asset''s carrying amount is greater than its
estimated recoverable amount.

The lease liability is initially measured at amortised
cost at the present value of the future lease payments.
The future lease payments are discounted using the
interest rate implicit in the lease or, if not readily
determinable, using the incremental borrowing rates.
For a lease with reasonably similar characteristics,
the Company, on a lease by lease basis, may adopt
either the incremental borrowing rate specific to
the lease or the incremental borrowing rate for
the portfolio as a whole. In addition, the carrying
amount of lease liabilities is remeasured if there
is a modification, a change in the lease term, a
change in the lease payments or a change in the
assessment of an option to purchase the underlying
asset. When the lease liability is remeasured, a
corresponding adjustment is made to the carrying
amount of the right-of-use asset, or is recorded in
profit or loss if the carrying amount of the right-of-
use asset has been reduced to zero.

Right-of-use assets and Lease liabilities have
been separately presented in the Balance Sheet.
Further, lease payments have been classified as
financing cash flows.

xx. Impairment of non-financial assets

As at each Balance Sheet date, the Company assesses
whether there is an indication that a non-financial
asset may be impaired and also whether there is an

indication of reversal of impairment loss recognised
in the previous periods. If any indication exists, or
when annual impairment testing for an asset is
required, the Company determines the recoverable
amount and impairment loss is recognised when
the carrying amount of an asset exceeds its
recoverable amount.

Recoverable amount is determined:

¦ In case of an individual asset, at the higher
of the assets'' fair value less cost to sell and
value in use; and

¦ In case of cash generating unit (a group of assets
that generates identified, independent cash
flows), at the higher of cash generating unit''s fair
value less cost to sell and value in use.

In assessing value in use, the estimated future cash
flows are discounted to their present value using
pre-tax discount rate that reflects current market
assessments of the time value of money and risk
specified to the asset. In determining fair value less
cost to sell, recent market transaction are taken into
account. If no such transaction can be identified, an
appropriate valuation model is used.

Impairment losses of continuing operations, including
impairment on inventories, are recognised in the
Statement of Profit and Loss, except for properties
previously revalued with the revaluation taken to OCI.
For such properties, the impairment is recognised in
OCI up to the amount of any previous revaluation.

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 the Statement of Profit and Loss.

xxi. Earnings Per Share

Basic earnings per share is computed by dividing the
net profit or loss for the period attributable to the
equity shareholders of the Company by the weighted
average number of equity shares outstanding during
the period. The weighted average number of equity
shares outstanding during the period and for all
periods presented is adjusted for events, such as
bonus shares, other than the conversion of potential
equity shares, that have changed the number of
equity shares outstanding, without a corresponding
change in resources.

Diluted earnings per share is computed by dividing
the net profit or loss for the period attributable to the
equity shareholders of the Company and weighted
average number of equity shares considered for
deriving basic earnings per equity share and also
the weighted average number of equity shares that
could have been issued upon conversion of all dilutive
potential equity shares. The dilutive potential equity
shares are adjusted for the proceeds receivable had
the equity shares been actually issued at fair value
i.e., the average market value of the outstanding
equity shares).

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Mar 31, 2024

NOTE 1 CORPORATE INFORMATION

ITD Cementation India Limited (‘ITD Cem’ or ‘the Company’) is a public company domiciled in India and was incorporated in 1978 under the provisions of the erstwhile Companies Act, 1956. The Company having CIN L61000MH1978PLC020435, is engaged in construction of a wide variety of structures like maritime structures, Mass Rapid Transport Systems (MRTS), dams & tunnels, airports, highways, bridges & flyovers and other foundations and specialised engineering work. Its shares are listed on two recognised stock exchanges in India - the Bombay Stock Exchange and the National Stock Exchange. The registered office of the Company is located at Prima Bay, 9^th Floor, Tower - B, Gate No.05, Saki Vihar Road, Powai, Mumbai -400072, Maharashtra, India w.e.f 12 August 2022.

The standalone financial statements (‘the financial statements’) of the Company for the year ended 31 March 2024, were authorised for issue in accordance with the resolution of the Board of Directors on 28 May 2024.

NOTE 2 MATERIAL ACCOUNTING POLICIES

i. Basis of Preparation

The financial statements of the Company have been prepared to comply in all material respects with the Indian Accounting Standards (‘Ind AS’) as prescribed under Section 133 of the Companies Act, 2013 (‘the Act’) read with Companies (Indian Accounting Standards) Rules as amended from time to time.

The financial statements have been prepared under the historical cost convention, with the exception of certain financial assets and liabilities which have been measured at fair value, on an accrual basis of accounting.

The Company’s financial statements are reported in Indian Rupees, which is also the Company’s functional currency, and all values are rounded to the nearest Lakhs (I 00,000) and decimal thereof, except when otherwise indicated.

The statement of cash flow has been prepared under the indirect method as set out in Indian Accounting Standard (Ind AS 7) statement of cash flows.

ii. Operating cycle for current and non-current classification:

All the assets and liabilities have been classified as current or non-current, wherever applicable, as per the operating cycle of the Company as per the guidance set out in Schedule III to the Act. Operating cycle for the business activities of the Company covers the duration of the project/contract/service including

the defect liability period, wherever applicable, and extends upto the realisation of receivables (including retention monies) within the credit period normally applicable to the respective project.

iii. Accounting Estimates

The preparation of the financial statements, in conformity with the recognition and measurement principles of Ind AS, requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of financial statements and the results of operation during the reported period. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates which are recognised in the period in which they are determined.

iv. Key accounting estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

a. Contract revenue

Refer note 2(xvi)(a)

b. Valuation of investment in/loans to subsidiaries/joint ventures

The Company has performed valuation for its investments in equity of certain subsidiaries and joint ventures for assessing whether there is any impairment in the fair value. When the fair value of investments in subsidiaries cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow model. Similar assessment is carried for exposure of the nature of loans and interest receivable thereon. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a

degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as expected earnings in future years, liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of these investments.

c. Deferred tax assets

I n assessing the realisability of deferred income tax assets, management considers whether some portion or all of the deferred income tax assets will not be realised. The ultimate realisation of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. Management considers the scheduled reversals of deferred income tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred income tax assets are deductible, management believes that the Company will realise the benefits of those deductible differences. The amount of the deferred income tax assets considered realisable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced.

d. Defined benefit plans

The cost and present value of the gratuity obligation and compensated absences are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, attrition rate and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

e. Leases

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease required significant judgement. The Company uses significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount

rate. The Company revises the lease term if there is a change in non-cancellable period of a lease.

f. Useful lives of property, plant and equipment and intangible assets

The charge in respect of periodic depreciation is derived after determining an estimate of an asset’s expected useful life and the expected residual value at the end of its life. The useful lives and residual values of assets are determined by the management at the time of acquisition of asset and reviewed periodically, including at each financial year. The lives are based on historical experience with similar assets as well as anticipation of future events, which may impact their life, such as changes in technology.

g. Provisions and contingent liabilities

A provision is recognised when the Company has a present obligation as result of a past event and it is probable that the outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Contingent liabilities are not recognised in the financial statements. Contingent assets are disclosed where an inflow of economic benefits is probable.

v. Fair value measurement

The Company measures financial instruments, at fair value at each balance sheet date. (Refer note 36)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for the asset or liability, or

• In the absence of a principal market, In the most advantageous market for the asset or liability.

The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate

economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data is available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

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

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

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

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

At each reporting date, the Management analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Company’s accounting policies. For this analysis, the Management verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.

The Management also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above. This note summarises accounting policy for fair value.

Other fair value related disclosures are given in the relevant notes.

• Disclosures for valuation methods, significant estimates and assumptions (notes 35, 38, 39 and 40).

• Financial instruments (including those carried at amortised cost) (notes 6, 11, 12, 13, 17, 18, 20, 21, and 22).

• Quantitative disclosure of fair value measurement hierarchy (note 36).

vi. Property, Plant and Equipment (Tangible assets)

Property, Plant and Equipment is stated at cost of acquisition, including expenditure directly attributable to the acquisition or construction of asset to bring it in working condition for intended use, if any, till the date of acquisition/installation of the assets less accumulated depreciation and accumulated impairment losses, if any.

Subsequent expenditure relating to Property, Plant and Equipment is capitalised only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. When significant component of the asset is replaced, it is depreciated separately based on specific useful life. All other repairs and maintenance costs are charged to the Statement of Profit and Loss as incurred. The cost and related accumulated depreciation are eliminated from the financial statements, either on disposal or when retired from active use and the resultant gain or loss are recognised in the Statement of Profit and Loss.

vii. Capital work-in-progress

Capital work-in-progress, representing expenditure incurred in respect of assets under development and not ready for their intended use, are carried at cost. Cost includes related acquisition expenses, construction cost and other direct expenditure net of accumulated impairment, if any.

viii. Intangible Assets

I ntangible assets are stated at cost, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably, less accumulated amortisation and accumulated impairment losses, if any.

Intangible assets mainly comprise of license fees and implementation cost for software and other application software acquired for in-house use.

ix. Depreciation and amortisation

Depreciation is provided for property, plant and equipment so as to expense the cost less residual value over their estimated useful lives on a straight line basis. Intangible assets are amortised from the date they are available for use, over their estimated useful lives. The estimated useful lives are as mentioned below:

Asset category	Useful life (in years)	Basis of determination of useful livesA
Buildings	60	Assessed to be in line with Schedule II to the Act.
Leasehold improvements	Lower of lease period or 5 years	Assessed to be in line with Schedule II to the Act.
Leasehold buildings	Lower of lease period or 60 years	Assessed to be in line with Schedule II to the Act.
Plant and equipment (including tools and equipment)	3 to 21	Based on technical evaluation by management''s expert.
Vehicles	8	Assessed to be in line with Schedule II to the Act.
Office equipment	5	Assessed to be in line with Schedule II to the Act.
Furniture and fixtures	10	Assessed to be in line with Schedule II to the Act.
Computers	3 to 6	Assessed to be in line with Schedule II to the Act.
Intangible (Computer software)	5	Assessed to be in line with Schedule II to the Act.
A Useful lives of asset classes determined by management estimate, which are generally higher than those prescribed under Schedule II to the Act and are supported by the internal technical assessment of useful lives.

The estimated useful life and residual values are reviewed at each financial year end and the effect of any change in the estimates of useful life/residual value is accounted on prospective basis.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Depreciation on additions is provided on a pro-rata basis, from the date on which asset is ready to use.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are accounted in the Statement of Profit and Loss under Other income and Other expenses.

Purchase of furniture fixtures & office equipments at project sites are charged off in the year of acquisition.

x. Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

a. Financial Assets

(i) Initial Recognition

I n the case of financial assets, not recorded at fair value through profit or loss (FVPL), financial assets are recognised initially at fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or

convention in the market place (regular way trades) are recognised on the trade date i.e., the date that the Company commits to purchase or sell the asset.

(ii) Subsequent Measurement

For purposes of subsequent measurement, financial assets are classified in following categories:

- Financial Assets at Amortised Cost

Financial assets are subsequently measured at amortised cost if these financial assets are held within a business model with an objective to hold these assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Interest income from these financial assets is included in finance income using the effective interest rate (“EIR”) method. Impairment gains or losses arising on these assets are recognised in the Statement of Profit and Loss.

- Financial Assets Measured at Fair Value

Financial assets are measured at fair value through Other Comprehensive Income (‘OCI’) if these financial assets

are held within a business model with an objective to hold these assets in order to collect contractual cash flows or to sell these financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognised in the Statement of Profit and Loss.

Financial asset not measured at amortised cost or at fair value through OCI is carried at FVPL.

(iii) Impairment of Financial Assets

In accordance with Ind AS 109, the Company applies the Expected Credit Loss (‘ECL’) model for measurement and recognition of impairment loss on financial assets and credit risk exposures.

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on trade receivables. Simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECL at each reporting date, right from its initial recognition.

For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.

ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive (i.e., all cash shortfalls), discounted at the original EIR. Lifetime ECL are the expected

credit losses resulting from all possible default events over the expected life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

ECL impairment loss allowance (or reversal) during the period is recognised as income/ expense in the Statement of Profit and Loss.

(iv) De-recognition of Financial Assets

The Company de-recognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financial asset and substantially all risks and rewards of ownership of the asset to another entity.

If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognises its retained interest in the assets and an associated liability for amounts it may have to pay.

If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

On derecognition of a financial asset in its entirety, the difference between the carrying amount at the date of derecognition and the consideration received is recognised in profit or loss

b. Equity Instruments and Financial Liabilities

Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

(i) Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments which are issued for cash are recorded at the proceeds received, net of direct issue costs. Equity instruments which are issued for consideration other than cash are recorded at fair value of the equity instrument.

(ii) Financial Liabilities

- Initial Recognition

Financial liabilities are classified, at initial recognition, as financial liabilities at FVPL, loans and borrowings and payables as appropriate. All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

- Subsequent Measurement

The measurement of financial liabilities depends on their classification, as described below:

- Financial liabilities at FVPL

Financial liabilities at FVPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at FVPL. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Gains or losses on liabilities held for trading are recognised in the Statement of Profit and Loss.

Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation. Amortisation is recognised as finance income in the Statement of Profit and Loss.

- Financial liabilities at amortised cost

After initial recognition, interest-bearing loans and borrowings are subsequently

measured at amortised cost using the EIR method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in the Statement of Profit and Loss.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.

- Derivative financial instruments

The Company uses derivative financial instruments i.e. foreign exchange forward and options contracts to manage its exposure to foreign exchange risks. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. The Company uses hedging instruments that are governed by the policies of the Company.

Hedge Accounting

The Company uses foreign currency forward and options contracts to hedge its foreign currency risks which are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value with changes in fair value recognised in the Standalone Statement of Profit and Loss in the period when they arise.

- De-recognition of Financial Liabilities

Financial liabilities are de-recognised when the obligation specified in the contract is discharged, cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as de-recognition of the original liability and recognition of a new liability. The

difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

c. Offsetting Financial Instruments

Financial assets and financial liabilities are offset and the net amount is reported in the Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis to realise the assets and settle the liabilities simultaneously.

xi. Employee Benefits

a. Defined Contribution Plan

Contributions to defined contribution schemes such as superannuation scheme, employees’ state insurance, labour welfare are charged as an expense based on the amount of contribution required to be made as and when services are rendered by the employees. The above benefits are classified as Defined Contribution Schemes as the Company has no further obligations beyond the monthly contributions.

b. Defined Benefit Plan

I n respect of certain employees, provident fund contributions are made to a trust administered by the Company. The interest rate payable to the members of the trust shall not be lower than the statutory rate of interest declared by Central Government under Employees Provident Fund and Miscellaneous Provisions Act, 1952 and shortfall, if any, shall be made good by the Company. The contribution paid or payable including the interest shortfall, if any, is recognised as an expense in the period in which services are rendered by the employee. Accordingly the Provident Fund is treated as a defined benefit plan. Further, the pattern of investments for investible funds is as prescribed by the Government. Accordingly, other related disclosures in respect of provident fund have not been made.

The Company also provides for gratuity which is a defined benefit plan, the liabilities of which is determined based on valuations, as at the balance sheet date, made by an independent actuary using the projected unit credit method. Re-measurement, comprising of actuarial gains and losses, in respect of gratuity are recognised in the OCI, in the period in which they occur. Re-measurement recognised in OCI are not

reclassified to the Statement of Profit and Loss in subsequent periods. Past service cost is recognised in the Statement of Profit and Loss in the year of plan amendment or curtailment.

c. Leave entitlement and compensated absences

Accumulated leave which is expected to be utilised within next twelve months, is treated as short-term employee benefit. Leave entitlement, other than short term compensated absences, are provided based on a actuarial valuation, similar to that of gratuity benefit. Re-measurement, comprising of actuarial gains and losses, in respect of leave entitlement are recognised in the Statement of Profit and Loss in the period in which they occur.

d. Short-term Benefits

Short-term employee benefits such as salaries, wages, performance incentives etc. are recognised as expenses at the undiscounted amounts in the Statement of Profit and Loss of the period in which the related service is rendered. Expenses on non-accumulating compensated absences is recognised in the period in which the absences occur.

xii. Inventories

a. Construction materials are valued at lower of cost and net realisable value. Cost is determined on a weighted average method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the Company from the taxing authorities). Net Realisable value is the estimated selling price in the ordinary course of business, less the estimated cost necessary to make the sale.

b. Spares that are of regular use are charged to the statement of profit and loss as and when consumed.

xiii. Cash and Cash Equivalents

Cash and cash equivalents in the Balance Sheet comprises of cash at banks and on hand and shortterm deposits with an original maturity of three month or less, which are subject to an insignificant risk of changes in value.

xiv. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating

decision maker regularly monitors and reviews the operating result of the whole Company as one segment of “Construction”. Thus, as defined in Ind AS 108 “Operating Segments”, the Company’s entire business falls under this one operational segment and hence the necessary information has already been disclosed in the Balance Sheet and the Statement of Profit and Loss.

xv. Foreign Exchange Translation of Foreign Projects and Accounting of Foreign Exchange Transaction

a. Initial Recognition

Foreign currency transactions are initially recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

b. Conversion

Monetary assets and liabilities denominated in foreign currencies are reported using the closing rate at the reporting date. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

c. Treatment of Exchange Difference

Exchange differences arising on settlement/ restatement of foreign currency monetary assets and liabilities of the Company are recognised as income or expense in the Statement of Profit and Loss.

xvi. Revenue Recognition a. Contract Revenue

The Company derives revenues primarily from providing construction services.

Revenue from construction services, where the performance obligations are satisfied over time and where there is no uncertainty as to measurement or collectability of consideration, is recognised as per the percentage-of-completion method. The percentage-of-completion of a contract is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs. When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until such uncertainty is resolved.

Contract revenue earned in excess of certification are classified as contract assets (which we refer as unbilled work-in-progress) while certification in excess of contract revenue are classified as contract liabilities (which we refer to as due to customer). Advance payments received from contractee for which no services are rendered are presented as ‘Advance from contractee’. Impairment loss is recognised on account of credit risk in respect of a contract asset using expected credit loss model on similar basis as applicable to trade receivables.

Due to the nature of the work required to be performed on many of the performance obligations, the estimation of total revenue and cost of completion is complex, subject to many variables and requires significant judgment. Variability in the transaction price arises primarily due to liquidated damages, price variation clauses, changes in scope, incentives, if any. The Company considers its experience with similar transactions and expectations regarding the contract in estimating the amount of variable consideration to which it will be entitled and determining whether the estimated variable consideration should be constrained. The Company includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognised will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration are based largely on an assessment of anticipated performance and all information (historical, current and forecasted) that is reasonably available.

Contract modifications are accounted for when additions, deletions or changes are approved either to the contract scope or contract price. The accounting for modifications of contracts involves assessing whether the services added to an existing contract are distinct and whether the pricing is at the standalone selling price. Services added that are not distinct are accounted for on a cumulative catch up basis, while those that are distinct are accounted for prospectively, either as a separate contract, if the additional services are priced at the standalone selling price, or as a termination of the existing contract and creation of a new contract if not priced at the standalone selling price.

The Company presents revenues net of indirect taxes in its Statement of Profit and Loss.

Costs to obtain a contract which are incurred regardless of whether the contract was obtained are charged-off in Statement of Profit and Loss immediately in the period in which such costs are incurred.

b. Share of profit and loss from unincorporated entities in the nature of Subsidiary, Joint Venture or Joint Operations

In case of Unincorporated Entities in the nature of subsidiary/joint venture, share of profit and loss are recognised in the Statement of Profit and Loss as and when the right to receive the profit share or obligation to settle the loss is established.

In case of Unincorporated Entities in the nature of a Joint Operation; the Company recognises its direct right to the assets, liabilities, contingent liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the financial statements under the appropriate headings.

xvii. Other Income

a. Interest Income

I nterest income is accrued on a time proportion basis, by reference to the principal outstanding and the applicable Effective Interest Rate (EIR).

b. Other Income

Other items of income are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.

xviii. Income Taxes

Income tax expense comprises of current tax expense and the net change in the deferred tax asset or liability during the period. Current and deferred taxes are recognised in the Statement of Profit and Loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity, respectively.

a. Current Taxes

Current income tax is recognised based on the estimated tax liability computed after taking credit for allowances and exemptions in accordance

with the Income Tax Act, 1961. Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

b. Deferred Taxes

Deferred tax is determined by applying the Balance Sheet approach. Deferred tax assets and liabilities are recognised for all deductible temporary differences between the financial statements’ carrying amount of existing assets and liabilities and their respective tax base. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are substantively enacted at the Balance Sheet date. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the period that includes the enactment date. Deferred tax assets are only recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised. Such assets are reviewed at each Balance Sheet date to reassess realisation.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities. 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 realise the asset and settle the liability simultaneously.

xix. Leases

The Company’s lease asset classes primarily consist of leases for land, building and plant and equipment. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange of the consideration.

At the date of the commencement of the lease, the Company recognises a right-of-use asset representing its right to use the underlying asset for the lease term and a corresponding lease liability for all the lease arrangements in which it is a lease, except for leases with a term of twelve months or less (short-term leases) and low value leases. For these short-term and low value leases, the Company recognises the lease payments as an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognised at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease. They are subsequently measured at cost less accumulated depreciation and impairment losses. Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying asset. The estimated useful life of the assets are determined on the same basis as those of property, plant and equipment.

Right-of-use assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Carrying amount of right-of-use asset is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

The lease liability is initially measured at amortised cost at the present value of the future lease payments. The future lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates. For a lease with reasonably similar characteristics, the Company, on a lease by lease basis, may adopt either the incremental borrowing rate specific to the lease or the incremental borrowing rate for the portfolio as a whole.

In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments or a change in the assessment of an option to purchase the underlying asset. When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Right-of-use assets and Lease liabilities have been separately presented in the Balance Sheet. Further, lease payments have been classified as financing cash flows.

xx. Impairment of non-financial assets

As at each Balance Sheet date, the Company assesses whether there is an indication that a non-financial asset may be impaired and also whether there is an indication of reversal of impairment loss recognised in the previous periods. If any indication exists, or when annual impairment testing for an asset is required, the Company determines the recoverable amount

and impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.

Recoverable amount is determined:

• In case of an individual asset, at the higher of the assets’ fair value less cost to sell and value in use; and

• In case of cash generating unit (a group of assets that generates identified, independent cash flows), at the higher of cash generating unit’s fair value less cost to sell and value in use.

In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and risk specified to the asset. In determining fair value less cost to sell, recent market transaction are taken into account. If no such transaction can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognised in the Statement of Profit and Loss, except for properties previously revalued with the revaluation taken to OCI. For such properties, the impairment is recognised in OCI up to the amount of any previous revaluation.

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 the Statement of Profit and Loss.

xxi. Earnings Per Share

Basic earnings per share is computed by dividing the net profit or loss for the period attributable to the equity shareholders of the Company by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in resources.

Diluted earnings per share is computed by dividing the net profit or loss for the period attributable to the equity shareholders of the Company and weighted average number of equity shares considered for deriving basic earnings per equity share and also the weighted

average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. The dilutive potential equity shares are adjusted for the proceeds receivable had the equity shares been actually issued at fair value (i.e. the average market value of the outstanding equity shares).

xxii. Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when the Company has a present obligation (legal or constructive) as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, in respect of which a reliable estimate can be made of the amount of obligation. Provisions (excluding gratuity and compensated absences) are determined based on management’s estimate required to settle the obligation at the Balance Sheet date. In case the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. These are reviewed at each Balance Sheet date and adjusted to reflect the current management estimates.

Contingent liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future

events not wholly within the control of the Company. A contingent liability also arises, in rare cases, where a liability cannot be recognised because it cannot be measured reliably.

Contingent assets are disclosed where an inflow of economic resources is probable.

xxiii. Commitments

Commitments are future liabilities for contractual expenditure, classified and disclosed as estimated amount of contracts remaining to be executed on capital account and not provided for.

xxiv. Exceptional Items

When items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the period, the nature and amount of such material items are disclosed separately as exceptional items.

xxv. Recent accounting pronouncements

The Ministry of Corporate Affairs (MCA) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

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Mar 31, 2023

SIGNIFICANT ACCOUNTING POLICIES

i. Basis of Preparation

The financial statements of the Company have been
prepared to comply in all material respects with the Indian
Accounting Standards (""Ind AS"") as prescribed under
Section 133 of the Companies Act, 2013 (''the Act'') read
with Companies (Indian Accounting Standards) Rules as
amended from time to time.

The financial statements have been prepared under the
historical cost convention, with the exception of certain
financial assets and liabilities which have been measured
at fair value, on an accrual basis of accounting.

The Company’s financial statements are reported in
Indian Rupees, which is also the Company’s functional
currency, and all values are rounded to the nearest Lakhs
('' 00,000) and decimal thereof, except when otherwise
indicated.

The statement of cash flow has been prepared under the
indirect method as set out in Indian Accounting Standard
(Ind AS 7) statement of cash flows.

ii. Operating Cycle for Current and Non-Current
classification

All the assets and liabilities have been classified as
current or non-current, wherever applicable, as per the
operating cycle of the Company as per the guidance
set out in Schedule III to the Act. Operating cycle for
the business activities of the Company covers the
duration of the project/contract/service including the
defect liability period, wherever applicable, and extends
up to the realisation of receivables (including retention
monies) within the credit period normally applicable to
the respective project.

iii. Accounting Estimates

The preparation of the financial statements, in conformity
with the recognition and measurement principles of Ind
AS, requires the management to make estimates and
assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent liabilities as
at the date of financial statements and the results of
operation during the reported period. Although these
estimates are based upon management’s best knowledge
of current events and actions, actual results could differ
from these estimates which are recognised in the period
in which they are determined.

iv. Key accounting estimates and assumptions

The key assumptions concerning the future and other key
sources of estimation uncertainty at the reporting date,
that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the
next financial year, are described below. The Company
based its assumptions and estimates on parameters
available when the financial statements were prepared.
Existing circumstances and assumptions about future
developments, however, may change due to market
changes or circumstances arising that are beyond the
control of the Company. Such changes are reflected in
the financial statements in the period in which changes
are made and, if material, their effects are disclosed in the
notes to the financial statements.

a) Contract Revenue
Refer note 2(xvi)(a)

b) Valuation of Investment in/Loans to
Subsidiaries/Joint ventures

The Company has performed valuation for its
investments in equity of certain subsidiaries and
joint ventures for assessing whether there is any
impairment in the fair value. When the fair value of
investments in subsidiaries cannot be measured
based on quoted prices in active markets, their
fair value is measured using valuation techniques
including the discounted cash flow model. Similar
assessment is carried for exposure of the nature of
loans and interest receivable thereon. The inputs to
these models are taken from observable markets
where possible, but where this is not feasible, a
degree of judgement is required in establishing
fair values. Judgements include considerations of
inputs such as expected earnings in future years,
liquidity risk, credit risk and volatility. Changes in
assumptions about these factors could affect the
reported fair value of these investments.

c) Deferred Tax Assets

I n assessing the realisability of deferred income
tax assets, management considers whether some
portion or all of the deferred income tax assets will
not be realised. The ultimate realisation of deferred
income tax assets is dependent upon the generation

of future taxable income during the periods in which
the temporary differences become deductible.
Management considers the scheduled reversals
of deferred income tax liabilities, projected future
taxable income and tax planning strategies in making
this assessment. Based on the level of historical
taxable income and projections for future taxable
income over the periods in which the deferred
income tax assets are deductible, management
believes that the Company will realise the benefits
of those deductible differences. The amount of the
deferred income tax assets considered realisable,
however, could be reduced in the near term if
estimates of future taxable income during the carry
forward period are reduced.

d) Defined Benefit Plans

The cost and present value of the gratuity obligation
and compensated absences are determined using
actuarial valuations. An actuarial valuation involves
making various assumptions that may differ from
actual developments in the future. These include
the determination of the discount rate, future salary
increases, attrition rate and mortality rates. Due to
the complexities involved in the valuation and its
long-term nature, a defined benefit obligation is
highly sensitive to changes in these assumptions.
All assumptions are reviewed at each reporting date.

e) Leases

The Company evaluates if an arrangement qualifies
to be a lease as per the requirements of Ind AS
116. Identification of a lease required significant
judgement. The Company uses significant
judgement in assessing the lease term (including
anticipated renewals) and the applicable discount
rate. The Company revises the lease term if there is
a change in non-cancellable period of a lease.

f) Useful lives of Property, Plant and Equipment
and Intangible Assets

The charge in respect of periodic depreciation is
derived after determining an estimate of an asset''s
expected useful life and the expected residual value
at the end of its life. The useful lives and residual
values of assets are determined by the management
at the time of acquisition of asset and reviewed
periodically, including at each financial year. The
lives are based on historical experience with similar
assets as well as anticipation of future events, which
may impact their life, such as changes in technology.

g) Provisions and Contingent Liabilities

A provision is recognised when the Company has
a present obligation as result of a past event and
it is probable that the outflow of resources will be
required to settle the obligation, in respect of which a
reliable estimate can be made. These are reviewed at
each balance sheet date and adjusted to reflect the

current best estimates. Contingent liabilities are not
recognised in the financial statements. Contingent
assets are disclosed where an inflow of economic
benefits is probable.

v. Fair Value Measurement

The Company measures financial instruments, at fair
value at each balance sheet date. (Refer note 36)

Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability
takes place either:

- In the principal market for the asset or liability, or

- I n the absence of a principal market, In the most
advantageous market for the asset or liability.

The principal or the most advantageous market must be
accessible by the Company.

The fair value of an asset or a liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest.

A fair value measurement of a non-financial asset takes
into account a market participant''s ability to generate
economic benefits by using the asset in its highest and
best use or by selling it to another market participant that
would use the asset in its highest and best use.

The Company uses valuation techniques that are
appropriate in the circumstances and for which sufficient
data is available to measure fair value, maximising the
use of relevant observable inputs and minimising the
use of unobservable inputs. All assets and liabilities for
which fair value is measured or disclosed in the financial
statements are categorised within the fair value hierarchy,
described as follows, based on the lowest level input that
is significant to the fair value measurement as a whole:

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

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

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

For assets and liabilities that are recognised in the
financial statements on a recurring basis, the Company
determines whether transfers have occurred between
levels in the hierarchy by re-assessing categorisation
(based on the lowest level input that is significant to the
fair value measurement as a whole) at the end of each
reporting period.

At each reporting date, the Management analyses the
movements in the values of assets and liabilities which
are required to be remeasured or re-assessed as per the
Company’s accounting policies. For this analysis, the
Management verifies the major inputs applied in the latest
valuation by agreeing the information in the valuation
computation to contracts and other relevant documents.

The Management also compares the change in the fair
value of each asset and liability with relevant external
sources to determine whether the change is reasonable.

For the purpose of fair value disclosures, the Company
has determined classes of assets and liabilities on the
basis of the nature, characteristics and risks of the asset
or liability and the level of the fair value hierarchy as
explained above. This note summarises accounting policy
for fair value.

Other fair value related disclosures are given in the
relevant notes.

- Disclosures for valuation methods, significant
estimates and assumptions (notes 35, 38, 39 and 40).

- Financial instruments (including those carried at
amortised cost) (notes 6, 11, 12, 13, 17, 18, 20, 21,
and 22).

- Quantitative disclosure of fair value measurement
hierarchy (note 36).

vi. Property, Plant and Equipment (Tangible Assets)

Property, Plant and Equipment is stated at cost of
acquisition, including expenditure directly attributable
to the acquisition or construction of asset to bring it in
working condition for intended use, if any, till the date of
acquisition/installation of the assets less accumulated
depreciation and accumulated impairment losses, if any.

Subsequent expenditure relating to Property, Plant and
Equipment is capitalised only when it is probable that future
economic benefits associated with the item will flow to the
Company and the cost of the item can be measured reliably.
When significant component of the asset is replaced, it is
depreciated separately based on specific useful life. All other
repairs and maintenance costs are charged to the Statement of
Profit and Loss as incurred. The cost and related accumulated
depreciation are eliminated from the financial statements,
either on disposal or when retired from active use and the
resultant gain or loss are recognised in the Statement of Profit
and Loss.

vii. Capital Work-in-progress

Capital work-in-progress, representing expenditure
incurred in respect of assets under development and not
ready for their intended use, are carried at cost. Cost
includes related acquisition expenses, construction
cost and other direct expenditure net of accumulated
impairment, if any.

viii. Intangible Assets

I ntangible assets are stated at cost, only when it is
probable that future economic benefits associated
with the item will flow to the Company and the cost of
the item can be measured reliably, less accumulated
amortisation and accumulated impairment losses, if any.
Intangible assets mainly comprise of license fees and
implementation cost for software and other application
software acquired for in-house use.

ix. Depreciation and Amortisation

Depreciation is provided for property, plant and equipment
so as to expense the cost less residual value over their
estimated useful lives on a straight-line basis. Intangible
assets are amortised from the date they are available
for use, over their estimated useful lives. The estimated
useful lives are as mentioned below:

Depreciation on additions is provided on a pro-rata basis, from
the date on which asset is ready to use.

Gains and losses on disposals are determined by comparing
proceeds with carrying amount. These are accounted in the
Statement of Profit and Loss under Other income and Other
expenses.

x. Financial Instruments

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

a) Financial Assets

(i) Initial Recognition

In the case of financial assets, not recorded at
fair value through profit or loss (FVPL), financial
assets are recognised initially at fair value plus
transaction costs that are directly attributable to
the acquisition of the financial asset. Purchases
or sales of financial assets that require delivery
of assets within a time frame established by
regulation or convention in the marketplace
(regular way trades) are recognised on the trade
date i.e., the date that the Company commits
to purchase or sell the asset.

(ii) Subsequent Measurement

For purposes of subsequent measurement,
financial assets are classified in following
categories:

- Financial Assets at Amortised Cost

Financial assets are subsequently
measured at amortised cost if these
financial assets are held within a business
model with an objective to hold these
assets in order to collect contractual cash
flows and the contractual terms of the
financial asset give rise on specified dates
to cash flows that are solely payments
of principal and interest on the principal
amount outstanding. Interest income
from these financial assets is included
in finance income using the effective
interest rate (“EIR”) method. Impairment
gains or losses arising on these assets are
recognised in the Statement of Profit and
Loss.

- Financial Assets Measured at Fair
Value

Financial assets are measured at fair value
through Other Comprehensive Income
(‘OCI’) if these financial assets are held
within a business model with an objective
to hold these assets in order to collect
contractual cash flows or to sell these
financial assets and the contractual terms

of the financial asset give rise on specified
dates to cash flows that are solely payments
of principal and interest on the principal
amount outstanding. Movements in the
carrying amount are taken through OCI,
except for the recognition of impairment
gains or losses, interest revenue and
foreign exchange gains and losses which
are recognised in the Statement of Profit
and Loss.

Financial asset not measured at amortised cost
or at fair value through OCI is carried at FVPL.

(iii) Impairment of Financial Assets

I n accordance with Ind AS 109, the Company
applies the Expected Credit Loss (“”ECL””)
model for measurement and recognition of
impairment loss on financial assets and credit
risk exposures.

The Company follows ‘simplified approach’
for recognition of impairment loss allowance
on trade receivables. Simplified approach does
not require the Company to track changes in
credit risk. Rather, it recognises impairment
loss allowance based on lifetime ECL at each
reporting date, right from its initial recognition.

For recognition of impairment loss on other
financial assets and risk exposure, the
Company determines that whether there has
been a significant increase in the credit risk
since initial recognition. If credit risk has not
increased significantly, 12-month ECL is used to
provide for impairment loss. However, if credit
risk has increased significantly, lifetime ECL is
used. If, in a subsequent period, credit quality
of the instrument improves such that there is no
longer a significant increase in credit risk since
initial recognition, then the entity reverts to
recognising impairment loss allowance based
on 12-month ECL.

ECL is the difference between all contractual
cash flows that are due to the Company in
accordance with the contract and all the cash
flows that the entity expects to receive (i.e., all
cash shortfalls), discounted at the original EIR.
Lifetime ECL are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument. The
12-month ECL is a portion of the lifetime ECL
which results from default events that are possible
within 12 months after the reporting date.

ECL impairment loss allowance (or reversal)
during the period is recognised as income/
expense in the Statement of Profit and Loss.

(iv) De-recognition of Financial Assets

The Company de-recognises a financial asset
only when the contractual rights to the cash
flows from the asset expire, or it transfers the
financial asset and substantially all risks and
rewards of ownership of the asset to another
entity.

I f the Company neither transfers nor retains
substantially all the risks and rewards of
ownership and continues to control the
transferred asset, the Company recognises its
retained interest in the assets and an associated
liability for amounts it may have to pay.

I f the Company retains substantially all the
risks and rewards of ownership of a transferred
financial asset, the Company continues
to recognise the financial asset and also
recognises a collateralised borrowing for the
proceeds received.

b) Equity Instruments and Financial Liabilities

Financial liabilities and equity instruments issued
by the Company are classified according to the
substance of the contractual arrangements entered
into and the definitions of a financial liability and an
equity instrument.

(i) Equity Instruments

An equity instrument is any contract that
evidences a residual interest in the assets of
the Company after deducting all of its liabilities.
Equity instruments which are issued for cash
are recorded at the proceeds received, net of
direct issue costs. Equity instruments which are
issued for consideration other than cash are
recorded at fair value of the equity instrument.

(ii) Financial Liabilities

- Initial Recognition

Financial liabilities are classified, at initial
recognition, as financial liabilities at FVPL,
loans and borrowings and payables as
appropriate. All financial liabilities are
recognised initially at fair value and, in
the case of loans and borrowings and
payables, net of directly attributable
transaction costs.

- Subsequent Measurement

The measurement of financial liabilities
depends on their classification, as
described below:

- Financial Liabilities at FVPL

Financial liabilities at FVPL include
financial liabilities held for trading and
financial liabilities designated upon initial

recognition as at FVPL. Financial liabilities
are classified as held for trading if they are
incurred for the purpose of repurchasing in
the near term. Gains or losses on liabilities
held for trading are recognised in the
Statement of Profit and Loss.

Financial guarantee contracts issued by
the Company are those contracts that
require a payment to be made to reimburse
the holder for a loss it incurs because the
specified debtor fails to make a payment
when due in accordance with the terms
of a debt instrument. Financial guarantee
contracts are recognised initially as a
liability at fair value, adjusted for transaction
costs that are directly attributable to the
issuance of the guarantee. Subsequently,
the liability is measured at the higher of
the amount of loss allowance determined
as per impairment requirements of Ind
AS 109 and the amount recognised less
cumulative amortisation. Amortisation
is recognised as finance income in the
Statement of Profit and Loss.

- Financial Liabilities at Amortised Cost
After initial recognition, interest-bearing
loans and borrowings are subsequently
measured at amortised cost using the
EIR method. Any difference between the
proceeds (net of transaction costs) and the
settlement or redemption of borrowings is
recognised over the term of the borrowings
in the Statement of Profit and Loss.

Amortised cost is calculated by taking
into account any discount or premium
on acquisition and fees or costs that
are an integral part of the EIR. The EIR
amortisation is included as finance costs
in the Statement of Profit and Loss.

- Derivative Financial Instruments

The Company uses derivative financial
instruments i.e. foreign exchange forward
and options contracts to manage its
exposure to foreign exchange risks. Such
derivative financial instruments are initially
recognised at fair value on the date on
which a derivative contract is entered
into and are subsequently re-measured
at fair value. The Company uses hedging
instruments that are governed by the
policies of the Company.

Hedge Accounting

The Company uses foreign currency
forward and options contracts to hedge
its foreign currency risks which are initially
recognised at fair value on the date a
derivative contract is entered into and
are subsequently remeasured at their fair
value with changes in fair value recognised
in the Standalone Statement of Profit and
Loss in the period when they arise.

- De-recognition of Financial Liabilities

Financial liabilities are de-recognised when
the obligation specified in the contract is
discharged, cancelled or expired. When
an existing financial liability is replaced
by another from the same lender on
substantially different terms, or the terms
of an existing liability are substantially
modified, such an exchange or modification
is treated as de-recognition of the original
liability and recognition of a new liability.
The difference in the respective carrying
amounts is recognised in the Statement
of Profit and Loss.

c) Offsetting Financial Instruments

Financial assets and financial liabilities are offset and
the net amount is reported in the Balance Sheet if
there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis to realise the assets and settle
the liabilities simultaneously.

xi. Employee Benefits

a) Defined Contribution Plan

Contributions to defined contribution schemes
such as superannuation scheme, employees’ state
insurance, labour welfare are charged as an expense
based on the amount of contribution required to be
made as and when services are rendered by the
employees. The above benefits are classified as
Defined Contribution Schemes as the Company
has no further obligations beyond the monthly
contributions.

b) Defined Benefit Plan

I n respect of certain employees, provident fund
contributions are made to a trust administered by the
Company. The interest rate payable to the members
of the trust shall not be lower than the statutory rate
of interest declared by Central Government under
Employees Provident Fund and Miscellaneous
Provisions Act, 1952 and shortfall, if any, shall be
made good by the Company. The contribution paid
or payable including the interest shortfall, if any, is
recognised as an expense in the period in which
services are rendered by the employee. Accordingly

the Provident Fund is treated as a defined benefit
plan. Further, the pattern of investments for
investible funds is as prescribed by the Government.
Accordingly, other related disclosures in respect of
provident fund have not been made.

The Company also provides for gratuity which
is a defined benefit plan, the liabilities of which is
determined based on valuations, as at the balance
sheet date, made by an independent actuary using
the projected unit credit method. Re-measurement,
comprising of actuarial gains and losses, in respect
of gratuity are recognised in the OCI, in the period
in which they occur. Re-measurement recognised
in OCI are not reclassified to the Statement of Profit
and Loss in subsequent periods. Past service cost
is recognised in the Statement of Profit and Loss in
the year of plan amendment or curtailment.

c) Leave Entitlement and Compensated Absences

Accumulated leave which is expected to be utilised
within next twelve months, is treated as short-term
employee benefit. Leave entitlement, other than
short-term compensated absences, are provided
based on a actuarial valuation, similar to that of
gratuity benefit. Re-measurement, comprising
of actuarial gains and losses, in respect of leave
entitlement are recognised in the Statement of Profit
and Loss in the period in which they occur.

d) Short-term Benefits

Short-term employee benefits such as salaries,
wages, performance incentives etc. are recognised
as expenses at the undiscounted amounts in
the Statement of Profit and Loss of the period in
which the related service is rendered. Expenses on
non-accumulating compensated absences is
recognised in the period in which the absences
occur.

xii. Inventories

a) Construction materials are valued at lower of cost
and net realisable value. Cost is determined on
a weighted average method and comprises the
purchase price including duties and taxes (other than
those subsequently recoverable by the Company
from the taxing authorities). Net Realisable value is
the estimated selling price in the ordinary course of
business, less the estimated cost necessary to make
the sale.

b) Spares that are of regular use are charged to the
statement of profit and loss as and when consumed.

xiii. Cash and Cash Equivalents

Cash and cash equivalents in the Balance Sheet
comprises of cash at banks and on hand and short-term
deposits with an original maturity of three month or less,
which are subject to an insignificant risk of changes in
value.

xiv. Segment Reporting

Operating segments are reported in a manner consistent
with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker
regularly monitors and reviews the operating result of
the whole Company as one segment of “Construction”.
Thus, as defined in Ind AS 108 “Operating Segments”,
the Company’s entire business falls under this one
operational segment and hence the necessary information
has already been disclosed in the Balance Sheet and the
Statement of Profit and Loss.

xv. Foreign Exchange Translation of Foreign Projects
and Accounting of Foreign Exchange Transaction

a) Initial Recognition

Foreign currency transactions are initially recorded
in the reporting currency, by applying to the foreign
currency amount the exchange rate between the
reporting currency and the foreign currency at the
date of the transaction.

b) Conversion

Monetary assets and liabilities denominated in
foreign currencies are reported using the closing rate
at the reporting date. Non-monetary items which are
carried in terms of historical cost denominated in a
foreign currency are reported using the exchange
rate at the date of the transaction.

c) Treatment of Exchange Difference

Exchange differences arising on settlement/
restatement of foreign currency monetary assets
and liabilities of the Company are recognised as
income or expense in the Statement of Profit and
Loss.

xvi. Revenue Recognition
a) Contract Revenue

The Company derives revenues primarily from
providing construction services.

Revenue from construction services, where the
performance obligations are satisfied over time and
where there is no uncertainty as to measurement
or collectability of consideration, is recognised
as per the percentage-of-completion method.
The percentage-of-completion of a contract is
determined by the proportion that contract costs
incurred for work performed up to the reporting date
bear to the estimated total contract costs. When
there is uncertainty as to measurement or ultimate
collectability, revenue recognition is postponed until
such uncertainty is resolved.

Contract revenue earned in excess of certification
are classified as contract assets (which we refer
as unbilled work-in-progress) while certification in
excess of contract revenue are classified as contract
liabilities (which we refer to as due to customer).

Advance payments received from contractee for
which no services are rendered are presented as
‘Advance from contractee’. Impairment loss is
recognised on account of credit risk in respect of a
contract asset using expected credit loss model on
similar basis as applicable to trade receivables.

Due to the nature of the work required to be
performed on many of the performance obligations,
the estimation of total revenue and cost of
completion is complex, subject to many variables
and requires significant judgement. Variability in the
transaction price arises primarily due to liquidated
damages, price variation clauses, changes in
scope, incentives, if any. The Company considers
its experience with similar transactions and
expectations regarding the contract in estimating
the amount of variable consideration to which it will
be entitled and determining whether the estimated
variable consideration should be constrained.
The Company includes estimated amounts in the
transaction price to the extent it is probable that a
significant reversal of cumulative revenue recognised
will not occur when the uncertainty associated with
the variable consideration is resolved.The estimates
of variable consideration are based largely on an
assessment of anticipated performance and all
information (historical, current and forecasted) that
is reasonably available.

Contract modifications are accounted for when
additions, deletions or changes are approved
either to the contract scope or contract price. The
accounting for modifications of contracts involves
assessing whether the services added to an existing
contract are distinct and whether the pricing is at
the standalone selling price. Services added that
are not distinct are accounted for on a cumulative
catch up basis, while those that are distinct are
accounted for prospectively, either as a separate
contract, if the additional services are priced at the
standalone selling price, or as a termination of the
existing contract and creation of a new contract if
not priced at the standalone selling price.

The Company presents revenues net of indirect
taxes in its Statement of Profit and Loss.

Costs to obtain a contract which are incurred
regardless of whether the contract was obtained
are charged-off in Statement of Profit and Loss
immediately in the period in which such costs are
incurred.

b) Share of profit and loss from unincorporated
entities in the nature of Subsidiary, Joint
Venture or Joint Operations

I n case of Unincorporated Entities in the nature of
subsidiary/joint venture, share of profit and loss
are recognised in the Statement of Profit and Loss

as and when the right to receive the profit share or
obligation to settle the loss is established.

I n case of Unincorporated Entities in the nature
of a Joint Operation; the Company recognises
its direct right to the assets, liabilities, contingent
liabilities, revenues and expenses of joint operations
and its share of any jointly held or incurred assets,
liabilities, revenues and expenses. These have been
incorporated in the financial statements under the
appropriate headings.

xvii. Other Income

a) Interest Income

I nterest income is accrued on a time proportion
basis, by reference to the principal outstanding and
the applicable Effective Interest Rate (EIR).

b) Other Income

Other items of income are accounted as and when
the right to receive such income arises and it is
probable that the economic benefits will flow to
the Company and the amount of income can be
measured reliably.

xviii. Income Taxes

Income tax expense comprises of current tax expense and
the net change in the deferred tax asset or liability during
the period. Current and deferred taxes are recognised in
the Statement of Profit and Loss, except when they relate
to items that are recognised in other comprehensive
income or directly in equity, in which case, the current and
deferred tax are also recognised in other comprehensive
income or directly in equity, respectively.

a. Current Taxes

Current income tax is recognised based on the
estimated tax liability computed after taking credit
for allowances and exemptions in accordance
with the Income Tax Act, 1961. Current income tax
assets and liabilities are measured at the amount
expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used
to compute the amount are those that are enacted
or substantively enacted, at the reporting date.

b. Deferred Taxes

Deferred tax is determined by applying the Balance
Sheet approach. Deferred tax assets and liabilities are
recognised for all deductible temporary differences
between the financial statements’ carrying amount
of existing assets and liabilities and their respective
tax base. Deferred tax assets and liabilities are
measured using the enacted tax rates or tax rates
that are substantively enacted at the Balance Sheet
date. The effect on deferred tax assets and liabilities
of a change in tax rates is recognised in the period
that includes the enactment date. Deferred tax
assets are only recognised to the extent that it is

probable that future taxable profits will be available
against which the temporary differences can be
utilised. Such assets are reviewed at each Balance
Sheet date to reassess realisation.

Deferred tax assets and liabilities are offset when
there is a legally enforceable right to offset current
tax assets and liabilities. 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 realise the asset and settle the
liability simultaneously.

xix. Leases

The Company’s lease asset classes primarily consist of
leases for land, building and plant and equipment. The
Company assesses whether a contract contains a lease,
at inception of a contract. A contract is, or contains, a
lease if the contract conveys the right to control the use
of an identified asset for a period of time in exchange of
the consideration.

At the date of the commencement of the lease, the
Company recognises a right-of-use asset representing
its right to use the underlying asset for the lease term
and a corresponding lease liability for all the lease
arrangements in which it is a lease, except for leases
with a term of twelve months or less (short-term leases)
and low value leases. For these short-term and low value
leases, the Company recognises the lease payments as
an operating expense on a straight-line basis over the
term of the lease.

The right-of-use assets are initially recognised at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the
commencement date of the lease. They are subsequently
measured at cost less accumulated depreciation and
impairment losses. Right-of-use assets are depreciated
from the commencement date on a straight-line basis
over the shorter of the lease term and useful life of the
underlying asset. The estimated useful life of the assets
are determined on the same basis as those of property,
plant and equipment.

Right-of-use assets are evaluated for recoverability
whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable.
Carrying amount of right-of-use asset is written down
immediately to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable
amount.

The lease liability is initially measured at amortised cost
at the present value of the future lease payments. The
future lease payments are discounted using the interest
rate implicit in the lease or, if not readily determinable,
using the incremental borrowing rates. For a lease with
reasonably similar characteristics, the Company , on a
lease by lease basis, may adopt either the incremental

borrowing rate specific to the lease or the incremental
borrowing rate for the portfolio as a whole.

Right-of-use assets and Lease liabilities have been
separately presented in the Balance Sheet. Further, lease
payments have been classified as financing cash flows.

xx. Impairment of Non-financial Aassets

As at each Balance Sheet date, the Company assesses
whether there is an indication that a non-financial asset
may be impaired and also whether there is an indication
of reversal of impairment loss recognised in the previous
periods. If any indication exists, or when annual
impairment testing for an asset is required, the Company
determines the recoverable amount and impairment loss
is recognised when the carrying amount of an asset
exceeds its recoverable amount.

Recoverable amount is determined:

- I n case of an individual asset, at the higher of the
assets’ fair value less cost to sell and value in use;
and

- I n case of cash generating unit (a group of assets
that generates identified, independent cash flows),
at the higher of cash generating unit’s fair value less
cost to sell and value in use.

I n assessing value in use, the estimated future cash
flows are discounted to their present value using pre-tax
discount rate that reflects current market assessments of
the time value of money and risk specified to the asset.
In determining fair value less cost to sell, recent market
transaction are taken into account. If no such transaction
can be identified, an appropriate valuation model is used.

I mpairment losses of continuing operations, including
impairment on inventories, are recognised in the
Statement of Profit and Loss, except for properties
previously revalued with the revaluation taken to OCI. For
such properties, the impairment is recognised in OCI up
to the amount of any previous revaluation.

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 the Statement of Profit and Loss.

xxi. Earnings Per Share

Basic earnings per share is computed by dividing
the net profit or loss for the period attributable to the
equity shareholders of the Company by the weighted
average number of equity shares outstanding during
the period. The weighted average number of equity
shares outstanding during the period and for all periods
presented is adjusted for events, such as bonus shares,
other than the conversion of potential equity shares, that

have changed the number of equity shares outstanding,
without a corresponding change in resources.

Diluted earnings per share is computed by dividing the
net profit or loss for the period attributable to the equity
shareholders of the Company and weighted average
number of equity shares considered for deriving basic
earnings per equity share and also the weighted average
number of equity shares that could have been issued
upon conversion of all dilutive potential equity shares.
The dilutive potential equity shares are adjusted for the
proceeds receivable had the equity shares been actually
issued at fair value (i.e. the average market value of the
outstanding equity shares).

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Dec 31, 2016

CORPORATE INFORMATION

ITD Cementation India Limited (''ITD Cem'' or ''the Company'') was incorporated in 1978 and is engaged in construction of a wide variety of structures like maritime structures, mass rapid transport systems (MRTS), dams & tunnels, airports, highways, bridges & flyovers and other foundations and specialist engineering work. The activities of the Company comprise only one business segment viz. Construction.

1. SIGNIFICANT ACCOUNTING POLICIES

A. Basis of accounting and preparation of standalone financial statements

The standalone financial statements of the Company have been prepared to comply in all material respects with the accounting standards notified by the Companies (Accounting Standards) Rules, read with Rule 7 to the Companies (Accounts) Rules 2014 in respect of Section 133 to the Companies Act, 2013. The standalone financial statements are prepared under the historical cost convention, on an accrual basis of accounting.

The accounting policies applied are consistent with those used in the previous year.

B. Accounting estimates

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

C. Fixed assets

Tangible assets are stated at cost, less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Subsequent expenditures related to an item of tangible asset are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance.

Capital work in progress represents expenditure incurred in respect of capital projects under development and are carried at cost. Cost includes related acquisition expenses, construction cost and other direct expenditure.

D. Depreciation on tangible fixed assets

(i) Depreciation on tangible assets is provided on straight line basis at useful life prescribed in Schedule II to the Companies Act, 2013 on a pro-rata basis. However, certain class of plant and machinery are depreciated on the useful life different from the useful life prescribed in Schedule II to the Companies Act, 2013 having regard to useful life of those assets in construction projects based on the management''s experience of use of those assets which is in line with industry practices.

(ii) Leasehold improvements are amortized over the lease period or useful life whichever is lower.

(iii) Depreciation for additions to/deductions from, owned assets is calculated pro rata from/to the month of additions/deductions.

E. Impairment of assets

The carrying amounts of the Company''s assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and its value in use. Impairment loss is recognized in the Statement of Profit and Loss or against revaluation surplus where applicable beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

F. Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as non-current investments.

Current investments are carried in the standalone financial statements at lower of cost or fair value determined on an individual investment basis. Non-current investments are carried at cost and provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

Investments in integrated Joint Ventures are carried at cost net of adjustments for Company''s share in profits or losses as recognized.

G. Inventories

i. Construction materials are valued at cost. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the Company from the taxing authorities).

ii. Tools and equipment are stated at cost less the amount amortized. Tools and equipment are amortized over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

iii. Machinery spares that are of regular use are charged to the statement of profit and loss as and when consumed.

iv. Unbilled work in progress: Work done remaining to be certified/billed is recognized as unbilled work in progress provided it is probable that they will be recovered in the accounts. The same is valued at the realizable value.

H. Revenue recognition

i) On contracts

Revenue from construction contracts is recognized on the basis of percentage completion method. The stage of completion of a contract is determined by the proportion that contract costs incurred for work performed up to the reporting date bear to the estimated total contract costs. Contract revenue earned in excess of certification has been classified as "Unbilled work-in-progress" and certification in excess of contract revenue has been classified as "Other current liabilities" in the standalone financial statements. Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is immediately provided for in the books of account. Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

ii) Accounting for Joint Venture Contracts

a) Revenue from unincorporated joint ventures under profit sharing arrangements is recognized to the extent of the Company''s share of profit in unincorporated joint ventures. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments in the Balance sheet.

b) Revenue from long term construction contracts executed in unincorporated joint ventures under work sharing arrangements is recognized on the same basis as similar contracts independently executed by the Company.

(iii) Service Income from Joint ventures

Service income is accounted on accrual basis in accordance with the terms of agreement with unincorporated Joint ventures.

(iv) Insurance claims

Insurance claims are recognized as income based on certainty of receipt.

(v) Interest Income and other income

Interest and other income are accounted for on accrual basis except where the receipt of income is uncertain in which case it is accounted for on receipt basis.

I. Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed. Amounts retained by the customers until the satisfactory completion of the contracts are recognized as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

J. Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous standalone financial statements, are recognized as income or as expenses in the year in which they arise.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

K. Employee benefits

i. Defined benefit plan

In terms of the Guidance on implementing Accounting Standard (AS) 15 - Employee Benefits, issued by the Accounting Standards Board of the Institute of Chartered Accountants of India, the Provident Fund set up by the Company is treated as a defined benefit plan. This is administered through trusts of the Company. The Company has to meet the interest shortfall, if any. Accordingly, the contribution paid or payable and the interest shortfall, if any, is recognized as an expense in the period in which services are rendered by the employee. Further, the pattern of investments for investible funds is as prescribed by the Government. Accordingly, other related disclosures in respect of provident fund have not been made.

Further company has defined benefit plans for post-employment benefits in the form of Gratuity. The Company has taken an insurance policy under the Group Gratuity Scheme with the insurance company to cover the Gratuity Liability. The liability for Defined Benefit Plans is provided on the basis of valuations, as at the Balance Sheet date, carried out by an independent actuary. The obligations are measured as the present value of estimated future cash flows discounted at rates reflecting the prevailing market yields of Indian Government securities as at the Balance Sheet date for the estimated term of the obligations. The estimate of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors.

The expected rate of return of plan assets is the Company''s expectation of the average long-term rate of return expected on investments of the fund during the estimated term of the obligations. Plan assets are measured at fair value as at the Balance Sheet date. The actuarial valuation method used by independent actuary for measuring the liability is the Projected Unit Credit method.

ii. Defined contribution plan:

The certain employees of the Company are also participant in the superannuation plan, employee state insurance scheme and Labour Welfare Fund scheme which is a defined contribution plan. The Company has no obligations to the Plan beyond its contributions. The Company''s contributions to Defined Contribution Plans are charged to the Statement of Profit and Loss as incurred.

iii. Other employee benefits

The Company treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee benefit for the measurement purposes. Such long-term compensated absences are provided for based on the actuarial valuations using the projected unit credit method at the period end. Accumulated leave which is expected to be utilized within next 12 months, is treated as short-term employee benefit. Actuarial gains and losses in respect of the defined benefit plans are recognized in the Statement of Profit and Loss in the period in which they arise.

L. Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares which could have been issued on conversion of all dilutive potential equity shares.

M. Taxation Current tax

Provision for current tax is recognized based on the estimated tax liability computed after taking credit for allowances and exemptions in accordance with the Income Tax Act, 1961.

Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Statement of Profit and Loss and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

Deferred tax

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to timing differences between the standalone financial statements'' carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are substantively enacted at the balance sheet dates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization in the future. Such assets are reviewed at each balance sheet date to reassess realization. Timing differences originating and reversing during the tax holiday period are not considered for the purpose of computing deferred tax assets and liabilities.

N. Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the Statement of Profit and Loss account on a straight-line basis over the lease term.

O. Provisions and Contingent Liabilities

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on management''s best estimates required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. Contingent assets are neither recognized nor disclosed in the standalone financial statements.

P. Cash and cash equivalents

Cash and cash equivalents comprise of cash at bank and cash in hand. The Company considers all highly liquid investments with an original maturity of three month or less from date of purchase, to be cash equivalents.

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Dec 31, 2014

A. Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 2013 (to the extent notified) and the Companies Act, 1956 (to the extent applicable) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies applied are consistent with those used in the previous year.

The accounting policies adopted in the preparation of financial statement are consistent with those of previous year except for the change in accounting policy of the company as explained below.

A.1 Summary of change in accounting policy

Upto the period ended 30 September 2014, the Company had been accounting for depreciation on fixed assets based on written down value method. Effective 1 October 2014, the Company has with retrospective effect changed its method of providing depreciation on fixed assets from the ''Written Down Value'' method to the ''Straight Line'' method. Management believes that this change will result in more appropriate presentation and will give a systematic basis of depreciation charge, representative of the time pattern in which the economic benefits will be derived from the use of these assets. The Company has also carried out a technical evaluation to assess the revised useful life of fixed assets. The change in the above accounting policy has resulted in a surplus of Rs. 9,553.25 lakhs relating to the depreciation already charged upto the period ended 30 September 2014 which has been disclosed as an exceptional item. Had the Company continued to use the earlier method of depreciation, the depreciation expense for the current year would have been higher by Rs. 192.49 lakhs.

B. Accounting estimates

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

C. Fixed assets

Fixed assets are stated at cost, less accumulated depreciation and impairment losses, if any Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

D. Depreciation on tangible fixed assets

(i) Depreciation was provided as per the straight-line method for assets acquired up to 31 March 1993 and as per the written-down value method for assets acquired on or after 1 April 1993 using the rates prescribed under Schedule XIV of Companies Act 1956.

Effective 1 October 2014, method of depreciation on fixed assets is changed from written down value to straight line method (as explained in II A.labove) using the rates prescribed under the Schedule XIV to the Companies Act, 1956. However in respect of the following asset categories, depreciation is provided at higher rates in line with their estimated useful life.

Tangible Assets Rate of Depreciation (% p.a.)

i) Plant and Machinery

a) Drilling machines, 8.33 demolition & cutting tools

b) Pumps, Ventilation Fans 8.33

c) Mining Cars, Mucking units 8.33

d) Other minor plant & 8.33 equipment of construction activity

ii) Office Equipment 20.00

iii) Furniture and Fixtures 10.00

(ii) Leasehold improvements are amortised over the lease period or useful life whichever is lower

(iii) Depreciation for additions to/deductions from, owned assets is calculated pro rata from/to the month of additions/ deductions.

(iv) Individual assets costing less than Rs. 5,000 are depreciated in full in the year they are put to use.

E. Impairment

The carrying amounts of the Company''s assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and its value in use. Impairment loss is recognized in the Statement of Profit and Loss or against revaluation surplus where applicable beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

F. Investments

Long term investments are stated at cost and diminution in carrying amount, other than temporary is written down/ provided for Investments in integrated Joint Ventures are carried at cost of net of adjustments for Company''s share in profits or losses as recognised. Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis.

G. Inventories

i. Construction materials are valued at cost. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

ii. Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

iii. Machinery spares that are of regular use are charged to the statement of profit and loss as and when consumed.

iv. Unbilled work in progress: Work done remaining to be certified/billed, as unbilled work-in-progress provided it is probable that they will be recovered in the accounts. The same is valued at the realizable value.

H. Revenue recognition

i. On contracts

Revenue from construction contracts is recognised on the basis of percentage completion method. The stage of completion of a contract is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs. Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue. In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of account. Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

ii. On insurance claims

Insurance claims are recognized as income based on certainty of receipt.

iii. Management fee

Management fee income is recognized based on the contractual terms with the parties.

I. Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability

J. Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company''s monetary items at rates different from those at which they were initially recorded during the year or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year

K. Employee benefits

i. Defined benefit plan

In terms of the Guidance on implementing Accounting Standard (AS) 15 - Employee Benefits, issued by the Accounting Standards Board of the Institute of Chartered Accountants of India, the Provident Fund set up by the company is treated as a defined benefit plan. This is administered through trusts of the company and the company has no further obligation beyond making the contributions. The Company has to meet the interest shortfall, if any. However, as at the year end, no shortfall remains provided for Further; the pattern of investments for investible funds is as prescribed by the Government. Accordingly, other related disclosures in respect of provident fund have not been made.

Further company has defined benefit plans for post- employment benefits in the form of Gratuity The Company has taken an Insurance Policy under the Group Gratuity Scheme with the insurance company to cover the Gratuity Liability The liability for Defined Benefit Plans is provided on the basis of valuations, as at the Balance Sheet date, carried out by an independent actuary.

The obligations are measured as the present value of estimated future cash flows discounted at rates reflecting the prevailing market yields of Indian Government securities as at the Balance Sheet date for the estimated term of the obligations. The estimate of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors.

The expected rate of return of plan assets is the company''s expectation of the average long-term rate of return expected on investments of the fund during the estimated term of the obligations. Plan assets are measured at fair value as at the Balance Sheet date. The actuarial valuation method used by independent actuary for measuring the liability is the Projected Unit Credit method.

ii. Defined contribution plan

The certain employees of the Company are also participant in the superannuation plan which is a defined contribution plan. The Company has no obligations to the Plan beyond its contributions.

The company''s contributions to Defined Contribution Plans are charged to the Statement of Profit and Loss as incurred.

iii. Other employee benefits

The employees of the company are also entitled for Leave availment and/or Encashment as per the company''s policy The liability for Leave Entitlement is provided on the basis of valuation, as at Balance Sheet date, carried out by an independent actuary The actuarial valuation method used for measuring the liability is the Projected Unit Credit method.

Termination benefits are recognised as an expense as and when incurred.

Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognised immediately in the Statement of Profit and Loss as income or expense

L. Earnings per share

Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares which could have been issued on conversion of all dilutive potential equity shares.

M. Taxation Current tax

Provision for current tax is recognized based on the estimated tax liability computed after taking credit for allowances and exemptions in accordance with the Income Tax Act, 1961. Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

Deferred tax

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to timing differences between the financial statements'' carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are substantively enacted at the Balance Sheet dates. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the period that includes the enactment date. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization in the future. Such assets are reviewed at each Balance Sheet date to reassess realization. Timing differences originating and reversing during the tax holiday period are not considered for the purpose of computing deferred tax assets and liabilities.

N. Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss account on a straight-line basis over the lease term.

O. Provisions and Contingent Liabilities

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on management''s best estimates required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

P. Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments.

Q. Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Dec 31, 2013

A. Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 2013 (to the extent notified) and the Companies Act, 1956 (to the extent applicable) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies applied are consistent with those used in the previous year.

All assets and liabilities have been classified as current or non- current, wherever applicable as per the operating cycle of the Company as per the guidance as set out in the Revised Schedule VI to the Companies Act, 1956.

B. Accounting estimates

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

C. Fixed assets and depreciation

Fixed assets are stated at cost, less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is provided as per the written-down value method for assets acquired on or after April 1, 1993, and as per the straight-line method for assets acquired up to March 31, 1993. On additions and disposals, depreciation is provided for from/up to the date of addition/disposal. The rates of depreciation are determined on the basis of useful lives of the assets estimated by the management, which are at rates specified in Schedule XIV to the Companies Act, 1956.

Leasehold improvements are depreciated over the lease period of 5 years, which is lower of the period of the lease or their estimated useful lives as determined by management.

Individual assets costing less than Rs. 5,000 are depreciated in full in the year they are put to use.

D. Impairment

The carrying amounts of the Company''s assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/ external factors. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and its value in use. Impairment loss is recognized in the Statement of Profit and Loss or against revaluation surplus where applicable beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

E. Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

F. Inventories

Construction materials are valued at cost. Identified direct materials remaining on completion of contract are valued at their estimated scrap value. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

Machinery spares that are of regular use are charged to the statement of profit and loss as and when consumed.

Unbilled work in progress: Cost of work yet to be certified/ billed, as it pertains to contract costs that relate to future activity on the contract, are recognised as unbilled work-in-progress provided it is probable that they will be recovered. Unbilled work-in-progress is valued at net realisable value.

G. Revenue recognition

- On contracts

Revenue from construction contracts is recognised on the basis of percentage completion method. The stage of completion of a contract is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs.

Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of account.

Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

- On insurance claims

Insurance claims are recognized as income based on certainty of receipt.

- Management Fee

Management Fee income is recognized based on the contractual terms with the parties.

H. Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

I. Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India before accounting period commencing on or after December 7, 2006 are capitalized as a part of property, plant and equipment.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

J. Employee benefits

i. Defined benefit plan

In terms of the Guidance on implementing Accounting Standard (AS) 15 - Employee Benefits, issued by the Accounting Standards Board of the Institute of Chartered Accountants of India, the Provident Fund set up by the company is treated as a defined benefit plan. This is administered through trusts of the company and the company has no further obligation beyond making the contributions. The Company has to meet the interest shortfall, if any. However, as at the year end, no shortfall remains provided for. Further, the pattern of investments for investible funds is as prescribed by the Government. Accordingly, other related disclosures in respect of provident fund have not been made.

Further company has defined benefit plans for post-employment benefits in the form of Gratuity. The Company has taken an Insurance Policy under the Group Gratuity Scheme with the insurance company to cover the Gratuity Liability. The liability for Defined Benefit Plans is provided on the basis of valuations, as at the Balance Sheet date, carried out by an independent actuary.

The obligations are measured as the present value of estimated future cash flows discounted at rates reflecting the prevailing market yields of Indian Government securities as at the Balance Sheet date for the estimated term of the obligations. The estimate of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors.

The expected rate of return of plan assets is the company''s expectation of the average long-term rate of return expected on investments of the fund during the estimated term of the obligations. Plan assets are measured at fair value as at the Balance Sheet date. The actuarial valuation method used by independent actuary for measuring the liability is the Projected Unit Credit method.

ii. Defined contribution plan

The certain employees of the Company are also participant in the superannuation plan which is a defined contribution plan. The Company has no obligations to the Plan beyond its contributions.

The company''s contributions to Defined Contribution Plans are charged to the Statement of Profit and Loss as incurred.

iii. Other employee benefits

The employees of the company are also entitled for Leave a ailment and/or Encashment as per the company''s policy. The liability for Leave Entitlement is provided on the basis of valuation, as at Balance Sheet date, carried out by an independent actuary. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method.

Termination benefits are recognised as an expense as and when incurred.

Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognised immediately in the Statement of Profit and Loss as income or expense.

K. Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares which could have been issued on conversion of all dilutive potential equity shares.

L. Taxation

Current tax

Provision for current tax is recognized based on the estimated tax liability computed after taking credit for allowances and exemptions in accordance with the Income Tax Act, 1961.

Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Statement of Profit and Loss and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

Deferred tax

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to timing differences between the financial statements'' carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are substantively enacted at the Balance Sheet dates. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the period that includes the enactment date. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization in the future. Such assets are reviewed at each Balance Sheet date to reassess realization.

M. Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as

operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss account on a straight-line basis over the lease term.

N. Provisions and Contingent Liabilities

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on management''s best estimates required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

O. Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments.

P. Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

b. Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except interim dividend.

During the year, Rs. 1.00 (31st December 2012 : Rs. 2.00) per share dividend recognised as distributions to equity share holders.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

As per records of the Company, including its register of shareholders/members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

e. Aggregate number of bonus shares issued, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding 31st December 2013

The Company has not issued any bonus shares nor has there been any buy back of shares during five years immediately preceding 31st December 2013.

f. Out of the total issued capital, 2,526 (31st December 2012 : 2,526) equity shares of Rs. 10 each have been kept in abeyance pending final settlement of rights issues.

Plant loan from financial institution (Secured)

Loan obtained from Tata Capital Limited for purchase of construction equipment carries interest rate ranging between 12.75 to 13.75 percent per annum and are repayable in 36 to 60 monthly installments. These loans are secured by first and exclusive charge on specific equipment financed by the institution.

Vehicle loan from bank (Secured)

Loan obtained from HDFC Bank and AXIS Bank for purchase of vehicles carries interest rate ranging between 10 to 12 percent per annum and are repayable in 60 monthly installments. These loans are secured by hypothecation of the vehicles purchased out of these loans.

Term loan from financial institution (Secured)

Loan obtained from India bulls Housing Finance Limited for purchase of office premise carries interest rate of 13.50 percent per annum and are repayable in 84 monthly installments commencing from April 2013. This loans are secured by hypothecation of office purchased out of this loan.

Term loan - from bank (Unsecured)

Term loan obtained from Vijaya Bank carried interest rate of base rate plus 2.50 percent per annum. This loan has been repaid during the year.

Working capital loan from banks (Secured) :

Working capital loans availed from consortium bankers carries various interest rates are secured by first pari passu charge on the current assets and movable plant and machinery other than those charged in favor of Tata Capital Limited. These facilities are repayable on demand.

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Dec 31, 2012

A. Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 (''the Act''). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies applied are consistent with those used in the previous year.

All assets and liabilities have been classified as current or non-current, wherever applicable as per the operating cycle of the Company as per the guidance as set out in the Revised Schedule VI to the Companies Act, 1956.

B. Accounting estimates

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

C. Fixed assets and depreciation

Fixed assets are stated at cost, less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is provided as per the written- down value method for assets acquired on or after April 1, 1993, and as per the straight-line method for assets acquired up to March 31, 1993. On additions and disposals, depreciation is provided for from/up to the date of addition/disposal. The rates of depreciation are determined on the basis of useful lives of the assets estimated by the management, which are at rates specified in Schedule XIV to the Companies Act, 1956.

Leasehold improvements are depreciated over the lease period of 5 years, which is lower of the period of the lease or their estimated useful lives as determined by management.

Individual assets costing less than Rs.5,000 are depreciated in full in the year they are put to use.

D. Impairment

The carrying amounts of the Company''s assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and its value in use. Impairment loss is recognized in the Statement of Profit and Loss or against revaluation surplus where applicable beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

E. Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

F. Inventories

Construction materials are valued at cost. Identified direct materials remaining on completion of contract are valued at their estimated scrap value. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

Machinery spares are valued at lower of cost and net realisable value. Cost is determined by the weighted average method.

Unbilled work in progress: Cost of work yet to be certified/ billed, as it pertains to contract costs that relate to future activity on the contract, are recognised as unbilled work-in- progress provided it is probable that they will be recovered. Unbilled work-in-progress is valued at net realisable value.

G. Revenue recognition

- On contracts

Revenue from construction contracts is recognised on the basis of percentage completion method. The stage of completion of a contract is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs.

Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of account.

Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

- On insurance claims

Insurance claims are recognized as income based on certainty of receipt.

- Management Fee

Management Fee income is recognized based on the contractual terms with the parties.

H. Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

I. Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India before accounting period commencing on or after December 7, 2006 are capitalized as a part of property,plant and equipment.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

J. Retirement and other employee benefits

Retirement benefits in the form of superannuation is a defined contribution scheme and the contributions are charged to the statement of profit and loss of the year when the contributions to the respective funds are due. The Company does not have any other obligations in respect of superannuation.

The Company has a provident fund scheme, a defined benefit plan, for employees and a group gratuity and life assurance scheme for employees. The life assurance scheme is the gratuity benefits payable towards unexpired period of service in case of death. The group gratuity and life assurance scheme are defined benefit obligations and are provided for, on the basis of an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Provision for leave encashment, is made based on an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Actuarial gains/losses are immediately taken to statement of profit and loss account and are not deferred.

K. Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares which could have been issued on conversion of all dilutive potential equity shares.

L. Taxation

Current tax

Provision for current tax is recognized based on the estimated tax liability computed after taking credit for allowances and exemptions in accordance with the Income Tax Act, 1961.

Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

Deferred tax

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to timing differences between the financial statements'' carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are substantively enacted at the Balance Sheet dates. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the period that includes the enactment date. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization in the future. Such assets are reviewed at each Balance Sheet date to reassess realization.

M. Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss account on a straight-line basis over the lease term.

N. Provisions and Contingent Liabilities

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on management''s best estimates required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

O. Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments.

P. Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Dec 31, 2011

1.1 Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 ('the Act'). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies applied are consistent with those used in the previous year.

1.2 Accounting estimates

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

1.3 Fixed assets and depreciation

Fixed assets are stated at cost, less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is provided as per the written- down value method for assets acquired on or after April 1, 1993, and as per the straight- line method for assets acquired up to March31, 1993. On additions and disposals, depreciation is provided for from/up to the date of addition/disposal. The rates of depreciation are determined on the basis of

useful lives of the assets estimated by the management, which are at rates specified in schedule XIV to the Companies Act, 1956.

Leasehold improvements are depreciated over the lease period of 5 years, which is lower of the period of the lease or their estimated useful lives as determined by management.

1.4 Impairment

i. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash f ows 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 assets.

ii. Depreciation on impaired assets is provided on the revised carrying amount of the assets over its remaining useful life.

iii. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.5 Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

1.6 Inventories

Construction materials are valued at cost. Identified direct materials remaining on completion of contract are valued at their estimated scrap value. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

Machinery spares are valued at lower of cost and net realisable value. Cost is determined by the weighted average method.

1.7 Revenue recognition

- On contracts

Contracts are either of fixed contract price or of fixed rate per unit of output and are at times subject to price escalation clauses. Revenue from contracts is recognised on the basis of percentage completion method, the level of completion depends on the nature and type of each contract and is measured based on the physical proportion of the contract work including:

Unbilled work-in-progress valued at lower of cost and net realisable value upto the stage of completion. Cost includes direct material, labour cost and appropriate overheads; and

Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of account.

Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

- On insurance claims

Insurance claims are recognized as revenue based on certainty of receipt.

1.8 Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

1.9 Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company's monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise.

Exchange differences arising in respect of fixed assets acquired from outside India before accounting period commencing on or after December 7, 2006 are capitalized as a part of fixed asset.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the profit and loss account in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year.

1.10 Retirement and other employee benefits

Retirement benefits in the form of superannuation is a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the respective funds are due. The Company does not have any other obligations in respect of superannuation.

The Company has a provident fund scheme, a defined benefit plan, for employees and a group gratuity and life assurance scheme for employees. The Life assurance scheme is the gratuity benefits payable towards unexpired period of service in case of death. The group gratuity and life assurance scheme are defined benefit obligations and are provided for, on the basis of an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Provision for leave encashment, is made based on an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

1.11 Taxation

Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. If the Company has unabsorbed depreciation or carry forward tax losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realised against future taxable profits.

At each balance sheet date the Company re- assesses unrecognised deferred tax assets. It recognises unrecognised deferred tax assets to the extent that it has become reasonably certain or virtually certain as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised.

The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes-down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

1.12 Leases

Leases, where the lesser effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

1.13 Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent Liability is disclosed in case of:

i. a present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation.

ii. a possible obligation, unless the probability of outflow of resources is remote.

Contingent Assets are neither recognized nor disclosed.

Contingent Liabilities and Contingent Assets are reviewed at each balance sheet date.

1.14 Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted average number of equity shares outstanding during the period are adjusted for events of bonus issue; bonus element in a rights issue to existing shareholders; share split; and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.15 Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments.

1.16 Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

The Company expects to contribute Rs. 75.00 lakhs to gratuity in the next year (2010 - Rs. 75.00 lakhs)

The amount of defined benefit obligation, plan assets, the deficit thereof and the experience adjustments on plan asset: and plan liabilities for the current and previous four years are as follows:

The information on the allocation of the gratuity fund into major asset classes and the expected return on each major class is not readily available. However, the gratuity fund is invested in a Group Gratuity policy invested with the Life Insurance Corporation and Birla Sunlife Insurance. The fair value of plan assets with Life Insurance Corporation and Birla Sunlife Insurance at December 31, 2011 are Rs. 0.06 lakhs (2010 - Rs. 21.24 lakhs) and Rs. 1,081.08 lakhs (2010 - Rs. 1,064.16 lakhs) respectively. The management understands that the assets in these portfolios are well diversified and as such the long term return thereon is expected to be higher than the rate of return on Government Bonds.

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

The estimates of future salary increases, considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

In respect of provident funds, the Guidance issued by the Accounting Standards Board ('ASB') of ICAI on implementing AS 15 states that provident funds trust is set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as a defined benefit plan. The Company's provident fund does not have any existing deficit or interest shortfall. In regard to any future obligation arising due to interest shortfall (i.e. government interest to be paid on provident fund scheme exceeds rate of interest earned on investment), pending the issuance of the Guidance Note from the Actuarial Society of India, the Company's actuary has expressed his inability to reliably measure the same.

The Company's expense for the superannuation, a defined contribution plan aggregates Rs.233.43 lakhs during the year ended December 31, 2011 (2010 - Rs.191.61 lakhs)

The Company's expense for the provident fund aggregates Rs. 613.80 lakhs during the year ended December 31, 2011 (2010 - Rs. 488.72 lakhs)

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Dec 31, 2010

1.1 Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956 (the Act). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies applied are consistent with those used in the previous year.

1.2 Accounting estimates

The preparation of financial statements in confirmity with the generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liability at the date of the financial statements and the results of operation during the reported period. Although these estimates are based upon managements best knowledge of current events and actions, actual result could defer from these estimates.

1.3 Fixed assets and depreciation

Fixed assets are stated at cost, less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is provided as per the written-down value method for assets acquired on or after April 1, 1993, and as per the straight-line method for assets acquired up to March 31, 1993. On additions and disposals, depreciation is provided for from/upto the date of addition/disposal. The rates of depreciation are determined on the basis of useful lives of the assets estimated by the management, which are at rates specified in schedule XIV to the Companies Act, 1956.

Leasehold improvements are depreciated over the lease period of 5 years, which is lower of the period of the lease or their estimated useful lives as determined by management.

1.4 Impairment

i. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/ external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value and the risk specific to the assets.

ii. Depreciation on impaired assets is provided on the revised carrying amount of the assets over its remaining useful life.

iii. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.5 Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

1.6 Inventories

Construction materials are valued at cost. Identified direct materials remaining on completion of contract are valued at their estimated scrap value. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method.

Machinery spares are valued at lower of cost and net realisable value. Cost is determined by the weighted average method.

1.7 Revenue recognition

-On contracts

Contracts are either of fixed contract price or of fixed rate per unit of output and are at times subject to price escalation clauses. Revenue from contracts is recognised on the basis of percentage completion method, the level of completion depends on the nature and type of each contract and is measured based on the physical proportion of the contract work including:

- Unbilled work-in-progress valued at lower of cost and net realisable value upto the stage of completion. Cost includes direct material, labour cost and appropriate overheads; and

- Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of account.

Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

- On insurance claims

Insurance claims are recognized as revenue based on certainty of receipt.

1.8 Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

1.9 Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate. Non-monetory items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting companys monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India before accounting period commencing on or after December 7, 2006 are capitalized as a part of fixed asset.

iv. Forward exchange contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the profit and loss account in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year.

1.10 Retirement and other employee benefits

Retirement benefits in the form of superannuation is a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the respective funds are due. The Company does not have any other obligations in respect of superannuation.

The Company has a provident fund scheme, a defined benefit plan, for employees and a group gratuity and life assurance scheme for employees. The group gratuity and life assurance scheme are defined benefit obligations and are provided for, on the basis of an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Provision for leave encashment, is made based on an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

1.11 Taxation

Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. If the Company has unabsorbed depreciation or carry forward tax losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realised against future taxable profits.

At each balance sheet date the Company re-assesses unrecognised deferred tax assets. It recognises unrecognised deferred tax assets to the extent that it has become reasonably certain or virtually certain as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised.

The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes-down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the profit and loss account and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

1.11 Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

1.12 Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent Liability is disclosed in case of:

i. a present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation.

ii. a possible obligation, unless the probability of outflow of resources is remote.

Contingent Assets are neither recognized nor disclosed.

Contingent Liabilities and Contingent Assets are reviewed at each balance sheet date.

1.13 Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted average number of equity shares outstanding during the period are adjusted for events of bonus issue; bonus element in a rights issue to existing shareholders; share split; and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.14 Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit / loss is accounted based on the audited financial statements of Joint Ventures and is reflected as Investments.

1.15 Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Dec 31, 2009

1.1 Basis of preparation of financial statements and changes in accounting policies

Basis of preparation

The financial statements have been prepared to comply in all material respects with the notified accounting standards by the Companies Accounting Standards Rules, 2006 and the relevant provisions of the Companies Act, 1956 (the Act). The financial statements are prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies are consistent with those used in the previous year.

1.2 Accounting estimates

The preparation of financial statements in conformity with the generally accepted accounting principles often requires estimates and assumptions to be made that affect the reported amount of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and reported amount of revenues and expenses during the reporting period. Any difference between the actual results and estimates are recognised in the period in which the results are known/ materialise.

1.3 Fixed assets and depreciation

Fixed assets are stated at cost, less accumulated depreciation and impairment losses if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is provided as per the written- down value method for assets acquired on or after April 1, 1993, and as per the straight-line method for assets acquired up to March 31, 1993. On additions and disposals, depreciation is provided for from/upto the date of addition/ disposal. The rates of depreciation are determined on the basis of useful lives of the assets estimated by the management, which are at rates specified in schedule XIV to the Companies Act, 1956.

Leasehold improvements are depreciated over the lease period of 5 years, which is lower of the period of the lease or their estimated useful lives as determined by management.

1.4 Impairment

i. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognizd wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.

ii. Depreciation on impaired assets is provided on the revised carrying amount of the assets over its remaining useful life.

iii. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.5 Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

1.6 Inventories

Construction materials are valued at cost. Identified direct materials remaining on completion of contract are valued at their estimated scrap value. Cost is determined on a first-in, first-out method and comprises the purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from the taxing authorities).

Tools and equipment are stated at cost less the amount amortised. Tools and equipment are amortised over their estimated useful lives ranging from 3 to 10 years. Cost is determined by the weighted average method. Machinery spares are valued at lower of cost and net realisable value. Cost is determined by the weighted average method.

1.7 Revenue recognition

- On contracts

Contracts are either of fixed contract price or of fixed rate per unit of output and are at times subject to price escalation clauses. Revenue from contracts is recognised on the basis of percentage completion method, the level of completion depends on the nature and type of each contract and is measured based on the physical proportion of the contract work including:

¦ Unbilled work-in-progress valued at lower of cost and net realisable value upto the stage of completion. Cost includes direct material, labour cost and appropriate overheads; and

¦ Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in contract work required for performance of the contract to the extent that it is probable that they will result in revenue.

In addition, if it is expected that the contract will make a loss, the estimated loss is provided for in the books of accounts. Contractual liquidated damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when such delays and causes are attributable to the Company or when deducted by the client.

- On insurance claims

Insurance claims are recognized as revenue based on certainty of receipt

1.8 Advances from customers, progress payments and retention

Advances received from customers in respect of contracts are treated as liabilities and adjusted against progress billing as per terms of the contract.

Progress payments received are adjusted against amount receivable from customers in respect of the contract work performed.

Amounts retained by the customers until the satisfactory completion of the contracts are recognised as receivables. Where such retention has been released by customers against submission of bank guarantees, the amount so released is adjusted against receivable from customers and the value of bank guarantees is disclosed as a contingent liability.

1.9 Foreign currency transactions

i. Initial Recognition

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

ii. Conversion

Foreign currency monetary items are reported using the closing rate.

iii. Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting companys monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India before accounting period commencing on or after December 7, 2006 are capitalized as a part of fixed asset.

iv. Forward exchange contracts not intended for trading or speculation purposes.

The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the Profit and Loss Account in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year.

1.10 Retirement and other employee benefits

Retirement benefits in the form of superannuation is a defined contribution scheme and the contributions are charged to the Profit and Loss Account of the year when the contributions to the respective funds are due. The Company does not have any other obligations in respect of superannuation.

The Company has a provident fund scheme, defined benefit plan, for employees and a group gratuity and life assurance scheme for eligible employees. The group gratuity and life assurance scheme are defined benefit obligations and are provided for, on the basis of an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Provision for leave encashment, is made based on an independent actuarial valuation on projected unit credit method made at the end of each financial year.

Actuarial gains/losses are immediately taken to Profit and Loss Account and are not deferred.

1.11 Taxation

Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the Balance Sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. If the Company has unabsorbed depreciation or carry forward tax losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realised against future taxable profits.

At each Balance Sheet date the Company re- assesses unrecognised deferred tax assets. It recognises unrecognised deferred tax assets to the extent that it has become reasonably certain or virtually certain as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised.

The carrying amount of deferred tax assets are reviewed at each Balance Sheet date. The Company writes-down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit Entitlement. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

1.12 Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the Profit and Loss Account on a straight-line basis over the lease term.

1.13 Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent Liability is disclosed in case of

(a) a present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation.

(b) a possible obligation, unlessthe probability of outflow of resources is remote.

Contingent Assets are neither recognized nor disclosed.

Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

1.14 Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted average number of equity shares outstanding during the period are adjusted for events of bonus issue; bonus element in a rights issue to existing shareholders; share split; and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.15 Accounting for Joint Venture Contracts

In respect of contract executed in Integrated Joint Ventures under profit sharing arrangement (assessed as AOP under Income Tax laws), the services rendered to the Joint Ventures is accounted as income on accrual basis. The share of profit/loss is accounted based on audited Financial Statements of Joint Ventures and is reflected as Investments.

1.16 Cash and cash equivalents

Cash and cash equivalents in the Cash Flow Statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.