Shanti Overseas (India) Ltd. कंपली की लेखा नीति

Mar 31, 2024

3. Significant Accounting Policies

3.1 Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An
asset is treated as current when it is:

? Expected to be realised or intended to be sold or consumed in normal operating cycle

? Held primarily for the purpose of trading

? Expected to be realised within twelve months after the reporting period, or

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

All other assets are classified as non-current.

A liability is current when:

? It is expected to be settled in normal operating cycle

? It is held primarily for the purpose of trading

? It is due to be settled within twelve months after the reporting period, or

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

All other liabilities are classified as non-current.

The operating cycle is the time between the acquisition of assets and their realisation in cash and cash equivalents.
The Company has identified twelve months as its operating cycle

3.2 Property, Plant &Equipments
Recognition and initial measurement

Property, plant and equipment are stated at their cost of acquisition. The cost comprises purchase price, borrowing
cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for
the intended use. Any trade discount and rebates are deducted in arriving at the purchase price. Subsequent costs are

included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that
future economic benefits associated with the item will flow to the Company.

All other repair and maintenance costs are recognized in statement of profit or loss as incurred.

Subsequent measurement (depreciation and useful lives)

Property, plant and equipment are subsequently measured at cost less accumulated depreciation and impairment losses,
if any.

Depreciation on property, plant and equipment has been provided using written down value method using rates
determined based on management’s assessment of useful economic lives of the asset.

Followings are the estimated useful lives of various category of assets used which are aligned with useful lives defined in
schedule II of Companies Act,2013:

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

Derecognition:

An item of property, plant and equipment and any significant part initially recognized is de-recognized upon disposal or
when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the
asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognized
in the statement of profit and loss, when the asset is de-recognized.

Capital work-in-progress (CWIP)

Cost of property, plant and equipment not ready for use as at the reporting date are disclosed as capital work-in progress.

3.3 Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets to determine whether there is
any indication of impairment. If any such indication of impairment exists, then the asset’s recoverable amount is estimated.
For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from
continuing use that are largely independent of the cash inflows of other assets or cash generating units (CGUs).

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in
use is based on the estimated future cash flows, discounted to their present value using a discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset or CGU. An impairment loss is
recognised if the carrying amount of an asset or CGU exceeds its estimated recoverable amount. Impairment losses are
recognised in the Statement of Profit and Loss.

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount.
Such a reversal is made only to the extent that the asset’s carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.