Swastik Pipe Ltd. कंपली की लेखा नीति

Mar 31, 2025

1. Disclosure of Accounting Policies (AS-1):

a. Nature of Operation:

Swastik Pipe Limited, (hereinafter referred as The Company), is a Listed Public Limited
Company which was incorporated on October 10, 1973, domiciled in India and registered
under the Indian Companies Act, 1956/2013 and having Registered Office at 1/23B, Asaf Ali
Road, Ajmeri Gate Extn., Central Delhi - 110002. Company is engaged in the business of
Manufacturing of ERW Black Pipe, Galvanized Steel Tubes, Cold Rolled Strips, S.T. Poles,
Solar Mounting Structures, etc.

Accounting Concepts & Basis of Presentation: The Financial Statements of the Company
have been prepared in accordance with the Accounting Principles generally accepted in
India. The Financial Statements have been prepared to comply in all material respects with
the Accounting Standards, as prescribed under Section 133 of the Companies Act, 2013 and
the Rules defined thereunder, as amended from time to time. Financial Statements have
been prepared under the historical cost convention on the accrual basis.

The company is not required to prepare its financial statements in accordance to Indian
Accounting Standards (Ind AS) because of the exemption notified by MCA to companies
listed on SME Exchange.

The financial statements are presented in Indian Rupees (INR) which is company’s
presentation and functional currency and all values are rounded to the nearest Lakhs (up to
two decimals) except when otherwise indicated.

Accounting Policies have been consistently applied except where a newly issued Accounting
Standard is initially adopted or a revision to an existing Accounting Standard requires a
change in the Accounting Policy hitherto in use.

b. Use of Estimates: The preparation of Financial Statements in conformity with the Generally
Accepted Accounting Principles requires the Management to make estimates, judgements,
and assumptions. These estimates, judgments and assumptions affect the application of the
Accounting Policies and the reported amounts of Assets and Liabilities, the disclosures of
Contingent Assets and Liabilities at the date of the Financial Statements and reported
amounts of Revenues and Expenses during the year.

The Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to
the Accounting Estimates are recognised in the period in which the estimate is revised, and
future periods affected.

Significant judgments and estimates relating to Carrying Value of Assets and Liabilities
include useful lives of Property, Plant and Equipment, impairment of Property, Plant and
Equipment, Investments, Provision for Employee Benefits and other provisions, recoverability
of Deferred Tax Assets, Commitments and Contingencies.

2. Valuation of Inventories (AS-2):

a. Stock of Raw Materials, Stores and spare parts are valued at cost; cost is determined on
Weighted Average method.

b. Stock of Finished goods and semi-finished goods are valued at cost or net realizable value
whichever is lower, cost is determined on Weighted Average method.

c. Waste and scraps are accounted at estimated realizable value.

3. Cash Flow Statement (AS - 3):

Cash flows are reported using indirect method, whereby profit before tax is adjusted for the
effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash
receipts or payments. The cash flow from regular revenue generating, financing and investing
activities of the Company is segregated. Cash and cash equivalents in the balance sheet
comprise cash in hand, all bank balances, and FDRs with bank of maturity less than three
months.

4. Contingencies And Events Occurring After Balance Sheet Date (AS -4)

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 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 Liabilities are not recognized but are disclosed in the notes to accounts when there
is possible obligation or a present obligation that may, but probably will not, require an outflow
of resources. When there is a possible obligation or a present obligation that the likelihood of
outflow of resources is remote. Contingent Assets are not recognized in the Financial
Statements.

5. Net Profit or Loss for The Period, Prior Period Items and Changes in Accounting Policies
(AS- 5):

a. Net Profit for the period and prior period items are shown separately in the Statement of
Profit & Loss wherever applicable.

b. Prior period items of income or expenses which arise in the current period as a result of
errors or omissions in the preparation of the financial statements of one or more prior
periods

c. Extraordinary items are income or expenses that arise from events or transactions that are
clearly distinct from the ordinary activities of the enterprise and, therefore, are not expected
to recur frequently or regularly.

6. Revenue Recognition (AS -9):

Revenue is recognized limited to the extent that it is probable that the economic benefits will
flow to the Company and the revenue can be reliably measured and it is reasonable to expect
ultimate collection.

a. Sale of Goods: Revenue is recognized when the significant risks and reward of ownership
of the goods have passed to the buyer. The company collects Goods and Service Tax
(GST) on behalf of the government and, therefore, these are not economic benefits flowing

to the company. Hence, they are excluded from revenue. Further, sales are shown Net of
goods returned.

b. Sale of Services: Sale of Services are recognised when services are rendered and related
cost are incurred.

c. Interest: Interest income is recognized on a time proportion basis taking into account the
amount outstanding and rate applicable.

d. Dividends: Dividends from investments in shares are not recognized in the statement of
profit and loss until a right to receive payment is established.

e. Export incentives: Exports benefits are accounted for on accrual basis.

f. Insurance claim: Insurance claim is recognised on receipt basis.

g. Other Income: Other Income includes Commission Income, Rental Income and other
incomes, which is recognised as per terms of contract.

Accounting for Property, Plant & Equipment (AS - 10):

A. Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and
impairment loss, if any. The cost comprises the purchase price and any attributable cost of
bringing the asset to its working condition for its intended use. Any trade discounts and rebates
are deducted in arriving at the purchase price. Borrowing costs relating to acquisition of
property, plant and equipment 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 property, plant and equipment is capitalized only if 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. Repairs and maintenance costs of items of
property, plant and equipment are recognized in the statement of profit and loss when incurred.

Gains or losses arising from derecognizing of property, plant and equipment are measured as
the difference between the net disposal proceeds and the carrying amount of the asset and are
recognized in the statement of profit and loss when the asset is derecognized.

B. Depreciation

Depreciation is provided for Property, Plant and Equipment on a Straight-Line Method so as to
expenses the Cost less Residual Value over their useful lives as prescribed in Part-C of
Schedule II of the Companies Act, 2013. The Estimated Useful Lives and Residual Value are
reviewed at the end of each Reporting Period, with the effect of any change in estimate
accounted for on a prospective basis.

Depreciation is not recorded on capital work-in progress until construction and installation is
completed and the asset is for intended use.

Depreciation on assets added during the year has been provided on pro-rata basis from the
date of addition. Depreciation on deductions during the year is provided on pro-rata basis up to
the date of sale.

Useful life of the Property, Plant and Equipment are enumerated as under:

C. Intangible Assets

a. Intangible assets including software licenses of enduring nature and acquired contractual
rights separately are measured on initial recognition, at cost. Intangible assets are carried at
cost less accumulated amortization and impairment losses, if any.

Cost of internally generated intangible assets comprises all directly attributable costs
necessary to create, produce, and prepare the asset to be capable of operating in the
manner intended by management.

Gains or losses arising from de-recognition of an intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of the asset and are
recognized in the statement of profit and loss when the asset is recognized.

b. The Intangible assets with a finite useful life, but not exceeding ten years, are amortized
using straight line method over their estimated useful lives. The estimated useful life is
reviewed annually by the management.

7. Accounting for the effects in foreign exchange rates (AS - 11):

Transactions in Foreign Currency are recorded at Exchange Rates prevailing at the date of
Transactions. Exchange differences arising on Foreign Exchange Transactions settled during
the year are recognised in the Statement of Profit and Loss of the year. Monetary Assets and
Liabilities denominated in Foreign Currencies which are outstanding, as at the Reporting Date
are translated at the Closing Exchange Rates and the resultant exchange differences are
recognised in the Statement of Profit and Loss. Further, foreign Debtors and Creditors are
revalued at exchange rates prevailing at the date of balance sheet.

8. Accounting for Investments (AS - 13):

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 Long-Term Investments. On initial recognition, all
Investments are measured at Cost. The Cost comprises the Purchase Price and directly
attributable acquisition charges such as Brokerage, Fees and Duties.

Current Investments are carried at the lower of Cost and Fair Value determined on an individual
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 Long-Term Investments.

On disposal of an investment, the difference between its Carrying Amount and Net Disposal
Proceeds is charged or credited to the Statement of Profit and Loss.

9. Employee Benefits (AS - 15):

• Defined Contribution Plan are post-employment benefit plans under which an enterprise pays
fixed contributions into a separate entity (a fund) and will have no obligation to pay further
contributions if the fund does not hold sufficient assets to pay all employee benefits relating to
employee service in the current and prior periods.

a. Short-term Employees Benefits

All employee benefits payable within twelve months of rendering the service are classified as
short-term benefits. Such benefits include salaries, wages, bonus, short term compensated
absences, awards, ex-gratia, performance pay etc. in the period in which the employee renders
the related service. A liability is recognized for the amount expected to be paid when there is a
present obligation to pay this amount as a result of past service provided by the employee and
the obligation can be estimated reliably.

• Defined Benefit Plan are post-employment benefit plans other than defined contribution plans.

b. Gratuity

The Company provides for Gratuity, covering eligible employees under Company Gratuity
Scheme. On reporting date, liabilities with respect to gratuity plan as determined by an
independent actuarial valuation and actuarial gains/losses are charged to the Statement of
Profit and Loss Account.

c. Leave Encashment

The obligation for Leave Encashment recognised, provided for and paid on yearly basis.

10. Borrowing Cost (AS-16)

Borrowing costs directly attributable to the acquisition, construction or production of an Asset
that necessarily takes a substantial period of time to get ready for its intended use or sale are
capitalized as part of the cost of the respective Asset.

a. Specific Borrowing: -

To the extent the funds are borrowed specifically for the purposes of acquisition, construction or
production of a qualifying asset, the amount of borrowing costs to be capitalized on the asset
shall be the actual borrowing costs incurred on the funds so borrowed.

b. Other than Specific Borrowing: -

To the extent the funds are borrowed generally and utilized for the purposes of acquisition,
construction or production of a qualifying asset, the amount of borrowing costs to be capitalized
shall be computed on proportionate basis.

Other Borrowing costs are recognized as an expense in the period in which they are incurred,
which are taken as upfront.

11. Segment Reporting (AS - 17)

A reportable segment is a business segment or a geographical segment identified on the basis
of foregoing definitions for which segment information is required to be disclosed by this
Standard.

The basic factor for Business segment is the nature of the products for the Company. which is a
distinguishable component that is engaged in providing an individual product or a group of
related products and that is subject to risks and returns that are different from those of other
business segments or as a whole business.

The basic factor Geographical segment, for the Company, is relationships between operations
in different geographical areas in terms of India and Outside India., which is a distinguishable
component that is engaged in providing products or within a particular economic environment
and that is subject to risks and returns that are different from those of components operating in
other economic environments.

12. Earnings per share (AS - 20):
a. Basic Earnings Per Share

Basic earnings per share is calculated by dividing the net profit for the period attributable to
equity shareholders by the weighted average number of equity shares outstanding during the
financial year. Earnings considered in ascertaining the company’s earnings per share is the net
profit for the period after deducting any attributable tax thereto for 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.

b. Diluted Earnings Per Share

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 is adjusted for the effects of all dilutive potential equity shares.

13. Accounting for taxes on income (AS - 22):

Provision is made for income tax liability estimated to arise on the results for the year at the
current rate of tax in accordance with Income Tax Act, 1961.

The differences that result between the profit considered for income taxes and the profit as per
the financial statements are identified, and thereafter a deferred tax asset or deferred tax liability
is recorded for timing differences, namely the differences that originate in one accounting period
and reverse in another, based on the tax effect of the aggregate amount being considered. The
tax effect is calculated on the accumulated timing differences at the end of an accounting period
based on prevailing enacted or substantially enacted regulations. Deferred Tax Assets are
recognized only if there is reasonable certainty that they will be realized and are reviewed for the
appropriateness of their respective carrying values at each balance sheet date.

---

Mar 31, 2024

Note 1: Significant Accounting Policies

1. Disclosure of Accounting Policies (AS-1):

a. Nature of Operation:

Swastik Pipe Limited, (hereinafter referred as The Company), is a Listed Public Limited Company which was incorporated on October 10, 1973, domiciled in India and registered under the Indian Companies Act, 1956/2013 and having Registered Office at 1/23B, Asaf Ali Road, Ajmeri Gate Extn., Central Delhi - 110002. Company is engaged in the business of Manufacturing of ERW Black Pipe, Galvanized Steel Tubes, Cold Rolled Strips, S.T. Poles, Solar Mounting Structures, etc.

Accounting Concepts & Basis of Presentation: The Financial Statements of the Company have been prepared in accordance with the Accounting Principles generally accepted in India. The Financial Statements have been prepared to comply in all material respects with the Accounting Standards, as prescribed under Section 133 of the Companies Act, 2013 and the Rules defined thereunder, as amended from time to time. Financial Statements have been prepared under the historical cost convention on the accrual basis.

The company is not required to prepare its financial statements in accordance to Indian Accounting Standards (Ind AS) because of the exemption notified by MCA to companies listed on SME Exchange.

The financial statements are presented in Indian Rupees (INR) which is company''s presentation and functional currency and all values are rounded to the nearest Lakhs (up to two decimals) except when otherwise indicated.

Accounting Policies have been consistently applied except where a newly issued Accounting Standard is initially adopted or a revision to an existing Accounting Standard requires a change in the Accounting Policy hitherto in use.

b. Use of Estimates: The preparation of Financial Statements in conformity with the Generally Accepted Accounting Principles requires the Management to make estimates, judgements, and assumptions. These estimates, judgments and assumptions affect the application of the Accounting Policies and the reported amounts of Assets and Liabilities, the disclosures of Contingent Assets and

Liabilities at the date of the Financial Statements and reported amounts of Revenues and Expenses during the year.

The Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to the Accounting Estimates are recognised in the period in which the estimate is revised, and future periods affected.

Significant judgments and estimates relating to Carrying Value of Assets and Liabilities include useful lives of Property, Plant and Equipment, impairment of Property, Plant and Equipment, Investments, Provision for Employee Benefits and other provisions, recoverability of Deferred Tax Assets, Commitments and Contingencies.

2. Valuation of Inventories (AS-2):

a. Stock of Raw Materials, Stores and spare parts are valued at cost; cost is determined on Weighted Average method.

b. Stock of Finished goods and semi-finished goods are valued at cost or net realizable value whichever is lower, cost is determined on Weighted Average method.

c. Waste and scraps are accounted at estimated realizable value.

3. Cash Flow Statement (AS - 3):

Cash flows are reported using indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flow from regular revenue generating, financing and investing activities of the Company is segregated. Cash and cash equivalents in the balance sheet comprise cash in hand, all bank balances, and FDRs with bank of maturity less than three months.

4. Contingencies And Events Occurring After Balance Sheet Date (AS -4)

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 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 Liabilities are not recognized but are disclosed in the notes to accounts when there is possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present

obligation that the likelihood of outflow of resources is remote. Contingent Assets are not recognized in the Financial Statements.

5. Net Profit or Loss for The Period, Prior Period Items and Changes in Accounting Policies (AS- 5):

a. Net Profit for the period and prior period items are shown separately in the Statement of Profit & Loss wherever applicable.

b. Prior period items of income or expenses which arise in the current period as a result of errors or omissions in the preparation of the financial statements of one or more prior periods

c. Extraordinary items are income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and, therefore, are not expected to recur frequently or regularly.

6. Revenue Recognition (AS -9):

Revenue is Recognized Limited to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured and it is reasonable to expect ultimate collection.

a. Sale of Goods: Revenue is recognized when the significant risks and reward of ownership of the goods have passed to the buyer. The company collects Goods and Service Tax (GST) on behalf of the government and, therefore, these are not economic benefits flowing to the company. Hence, they are excluded from revenue. Further, sales are shown Net of goods returned.

b. Sale of Services: Sale of Services are recognised when services are rendered and related cost are incurred.

c. Interest: Interest income is recognized on a time proportion basis taking into account the amount outstanding and rate applicable.

d. Dividends: Dividends from investments in shares are not recognized in the statement of profit and loss until a right to receive payment is established.

e. Export incentives: Exports benefits are accounted for on accrual basis.

f. Insurance claim: Insurance claim is recognised on receipt basis.

g. Other Income: Other Income includes Commission Income, Rental Income and other incomes, which is recognised as per terms of contract.

Accounting for Property, Plant & Equipment (AS - 10):

A. Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Borrowing costs relating to acquisition of property, plant and equipment 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 property, plant and equipment is capitalized only if 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. Repairs and maintenance costs of items of property, plant and equipment are recognized in the statement of profit and loss when incurred.

Gains or losses arising from derecognizing of property, plant and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

B. Depreciation

Depreciation is provided for Property, Plant and Equipment on a Straight-Line Method so as to expenses the Cost less Residual Value over their useful lives as prescribed in Part-C of Schedule II of the Companies Act, 2013. The Estimated Useful Lives and Residual Value are reviewed at the end of each Reporting Period, with the effect of any change in estimate accounted for on a prospective basis.

Depreciation is not recorded on capital work-in progress until construction and installation is completed and the asset is for intended use.

Depreciation on assets added during the year has been provided on pro-rata basis from the date of addition. Depreciation on deductions during the year is provided on pro-rata basis up to the date of sale.

Useful life of the Property, Plant and Equipment are enumerated as under:

C. Intangible Assets

a. Intangible assets including software licenses of enduring nature and acquired contractual rights separately are measured on initial recognition, at cost. Intangible assets are carried at cost less accumulated amortization and impairment losses, if any.

Cost of internally generated intangible assets comprises all directly attributable costs necessary to create, produce, and prepare the asset to be capable of operating in the manner intended by management.

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is recognized.

b. The Intangible assets with a finite useful life, but not exceeding ten years, are amortized using straight line method over their estimated useful lives. The estimated useful life is reviewed annually by the management.

7. Accounting for the effects in foreign exchange rates (AS - 11):

Transactions in Foreign Currency are recorded at Exchange Rates prevailing at the date of Transactions. Exchange differences arising on Foreign Exchange Transactions settled during the year are recognised in the Statement of Profit and Loss of the year. Monetary Assets and Liabilities denominated in Foreign Currencies which are outstanding, as at the Reporting Date are translated at the Closing Exchange Rates and the resultant exchange differences are recognised in the

Statement of Profit and Loss. Further, foreign Debtors and Creditors are revalued at exchange rates prevailing at the date of balance sheet.

8. Accounting for Investments (AS - 13):

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 Long-Term Investments. On initial recognition, all Investments are measured at Cost. The Cost comprises the Purchase Price and directly attributable acquisition charges such as Brokerage, Fees and Duties.

Current Investments are carried at the lower of Cost and Fair Value determined on an individual 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 Long-Term Investments.

On disposal of an investment, the difference between its Carrying Amount and Net Disposal Proceeds is charged or credited to the Statement of Profit and Loss.

9. Employee Benefits (AS - 15):

• Defined Contribution Plan are post-employment benefit plans under which an enterprise pays fixed contributions into a separate entity (a fund) and will have no obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods.

a. Short-term Employees Benefits

All employee benefits payable within twelve months of rendering the service are classified as short-term benefits. Such benefits include salaries, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc. in the period in which the employee renders the related service. A liability is recognized for the amount expected to be paid when there is a present obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

• Defined Benefit Plan are post-employment benefit plans other than defined contribution plans.

b. Gratuity

The Company provides for Gratuity, covering eligible employees under Company Gratuity Scheme. On reporting date, liabilities with respect to gratuity plan as determined by an independent actuarial valuation and actuarial gains/losses are charged to the Statement of Profit and Loss Account.

c. Leave Encashment

The obligation for Leave Encashment recognised, provided for and paid on yearly basis.

10. Borrowing Cost (AS-16)

Borrowing costs directly attributable to the acquisition, construction or production of an Asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective Asset.

a. Specific Borrowing: -

To the extent the funds are borrowed specifically for the purposes of acquisition, construction or production of a qualifying asset, the amount of borrowing costs to be capitalized on the asset shall be the actual borrowing costs incurred on the funds so borrowed.

b. Other than Specific Borrowing: -

To the extent the funds are borrowed generally and utilized for the purposes of acquisition, construction or production of a qualifying asset, the amount of borrowing costs to be capitalized shall be computed on proportionate basis.

Other Borrowing costs are recognized as an expense in the period in which they are incurred, which are taken as upfront.

11. Segment Reporting (AS - 17)

A reportable segment is a business segment or a geographical segment identified on the basis of foregoing definitions for which segment information is required to be disclosed by this Standard.

The basic factor for Business segment is the nature of the products for the Company. which is a distinguishable component that is engaged in providing an individual product or a group of related products and that is subject to risks and returns that are different from those of other business segments or as a whole business.

The basic factor Geographical segment, for the Company, is relationships between operations in different geographical areas in terms of India and Outside India., which is a distinguishable component that is engaged in providing products or within a particular economic environment and that is subject to risks and returns that are different from those of components operating in other economic environments.

12. Earnings per share (AS - 20):

a. Basic Earnings Per Share

Basic earnings per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the financial year. Earnings considered in ascertaining the company''s earnings per share is the net profit for the period after deducting any attributable tax thereto for 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. (Refer Point No. vi of note 30).

b. Diluted Earnings Per Share

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 is adjusted for the effects of all dilutive potential equity shares.

13. Accounting for taxes on income (AS - 22):

Provision is made for income tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income Tax Act, 1961.

The differences that result between the profit considered for income taxes and the profit as per the financial statements are identified, and thereafter a deferred tax asset or deferred tax liability is recorded for timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted or substantially enacted regulations. Deferred Tax Assets are recognized only if there is reasonable certainty that they will be realized and are

reviewed for the appropriateness of their respective carrying values at each balance sheet date.

---

Mar 31, 2023

Note 1: Significant Accounting Policies

1. Disclosure of Accounting Policies (AS-1):

a. Nature of Operation:

Swastik Pipe Limited, (hereinafter referred as The Company), is a Listed Public Limited Company which was incorporated on October 10, 1973, domiciled in India and registered under the Indian Companies Act, 1956/2013 and having Registered Office at 2, Arihant Nagar, Punjabi Bagh (W), New Delhi- 110026. Company is engaged in the business of Manufacturing of ERW Black Pipe, Galvanized Steel Tubes, Cold Rolled Strips, S.T. Poles, Solar Mounting Structures, etc.

Accounting Concepts & Basis of Presentation: The Financial Statements of the Company have been prepared in accordance with the Accounting Principles generally accepted in India. The Financial Statements have been prepared to comply in all material respects with the Accounting Standards, as prescribed under Section 133 of the Companies Act, 2013 and the Rules defined thereunder, as amended from time to time. Financial Statements have been prepared under the historical cost convention on the accrual basis.

The company is not required to prepare its financial statements in accordance to Indian Accounting Standards (Ind AS) because of the exemption notified by MCA to companies listed on SME Exchange.

The financial statements are presented in Indian Rupees (INR) which is company''s presentation and functional currency and all values are rounded to the nearest Lakhs (up to two decimals) except when otherwise indicated.

Accounting Policies have been consistently applied except where a newly issued Accounting Standard is initially adopted or a revision to an existing Accounting Standard requires a change in the Accounting Policy hitherto in use.

b. Use of Estimates: The preparation of Financial Statements in conformity with the Generally Accepted Accounting Principles requires the Management to

make estimates, judgements, and assumptions. These estimates, judgments and assumptions affect the application of the Accounting Policies and the reported amounts of Assets and Liabilities, the disclosures of Contingent Assets and Liabilities at the date of the Financial Statements and reported amounts of Revenues and Expenses during the year.

The Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to the Accounting Estimates are recognised in the period in which the estimate is revised, and future periods affected.

Significant judgments and estimates relating to Carrying Value of Assets and Liabilities include useful lives of Property, Plant and Equipment, impairment of Property, Plant and Equipment, Investments, Provision for Employee Benefits and other provisions, recoverability of Deferred Tax Assets, Commitments and Contingencies.

2. Valuation of Inventories (AS-2):

a. Stock of Raw Materials, Stores and spare parts are valued at cost; cost is determined on Weighted Average method.

b. Stock of Finished goods and semi-finished goods are valued at cost or net realizable value whichever is lower, cost is determined on Weighted Average method.

c. Waste and scraps are accounted at estimated realizable value.

3. Cash Flow Statement (AS - 3):

Cash flows are reported using indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flow from regular revenue generating, financing and investing activities of the Company is segregated. Cash and cash equivalents in the balance sheet comprise cash in hand, all bank balances, and FDRs with bank of maturity less than three months.

4. Contingencies And Events Occurring After Balance Sheet Date (AS -4)

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 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 Liabilities are not recognized but are disclosed in the notes to accounts when there is possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote. Contingent Assets are not recognized in the Financial Statements.

5. Net Profit or Loss for The Period, Prior Period Items and Changes in Accounting Policies (AS- 5):

a. Net Profit for the period and prior period items are shown separately in the Statement of Profit & Loss wherever applicable.

b. Prior period items of income or expenses which arise in the current period as a result of errors or omissions in the preparation of the financial statements of one or more prior periods

c. Extraordinary items are income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and, therefore, are not expected to recur frequently or regularly.

6. Revenue Recognition (AS -9):

Revenue is Recognized Limited to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured and it is reasonable to expect ultimate collection.

a. Sale of Goods: Revenue is recognized when the significant risks and reward of ownership of the goods have passed to the buyer. The company collects Goods and Service Tax (GST) on behalf of the government and, therefore, these are not economic benefits flowing to the company. Hence, they are excluded from revenue. Further, sales are shown Net of goods returned.

b. Sale of Services: Sale of Services are recognised when services are rendered and related cost are incurred.

c. Interest: Interest income is recognized on a time proportion basis taking into account the amount outstanding and rate applicable.

d. Dividends: Dividends from investments in shares are not recognized in the statement of profit and loss until a right to receive payment is established.

e. Export incentives: Exports benefits are accounted for on accrual basis.

f. Insurance claim: Insurance claim is recognised on receipt basis.

g. Other Income: Other Income includes Commission Income, Rental Income and other incomes, which is recognised as per terms of contract.

7. Accounting for Property, Plant & Equipment (AS - 10):

A. Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Borrowing costs relating to acquisition of property, plant and equipment 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 property, plant and equipment is capitalized only if 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. Repairs and maintenance costs of items of property, plant and equipment are recognized in the statement of profit and loss when incurred.

Gains or losses arising from derecognizing of property, plant and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

B. Depreciation

Depreciation is provided for Property, Plant and Equipment on a Straight-Line Method so as to expenses the Cost less Residual Value over their useful lives as prescribed in Part-C of Schedule II of the Companies Act, 2013. The Estimated Useful Lives and Residual Value are reviewed at the end of each Reporting Period, with the effect of any change in estimate accounted for on a prospective basis.

Depreciation is not recorded on capital work-in progress until construction and installation is completed and the asset is for intended use.

Depreciation on assets added during the year has been provided on pro-rata basis from the date of addition. Depreciation on deductions during the year is provided on pro-rata basis up to the date of sale.

Useful life of the Property, Plant and Equipment are enumerated as under:

Particulars	Useful Life (In Years)
Factory Shed	30
Office Building	60
Plant And Machinery	25
Furniture & Fixture	10
Vehicles	8
Office Equipment''s	5
Electric Fittings/ Equipment''s	10
Computers	3

C. Intangible Assets

a. Intangible assets including software licenses of enduring nature and acquired contractual rights separately are measured on initial recognition, at cost. Intangible assets are carried at cost less accumulated amortization and impairment losses, if any.

Cost of internally generated intangible assets comprises all directly attributable costs necessary to create, produce, and prepare the asset to be capable of operating in the manner intended by management.

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is recognized.

b. The Intangible assets with a finite useful life, but not exceeding ten years, are amortized using straight line method over their estimated useful lives. The estimated useful life is reviewed annually by the management.

8. Accounting for the effects in foreign exchange rates (AS - 11):

Transactions in Foreign Currency are recorded at Exchange Rates prevailing at the date of Transactions. Exchange differences arising on Foreign Exchange Transactions settled during the year are recognised in the Statement of Profit and Loss of the year. Monetary Assets and Liabilities denominated in Foreign Currencies which are outstanding, as at the Reporting Date are translated at the Closing Exchange Rates and the resultant exchange differences are recognised in the Statement of Profit and Loss. Further, foreign Debtors and Creditors are revalued at exchange rates prevailing at the date of balance sheet.

9. Accounting for Investments (AS - 13):

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 Long-Term Investments. On initial recognition, all Investments are measured at Cost. The Cost comprises the Purchase Price and directly attributable acquisition charges such as Brokerage, Fees and Duties.

Current Investments are carried at the lower of Cost and Fair Value determined on an individual 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 Long-Term Investments.

On disposal of an investment, the difference between its Carrying Amount and Net Disposal Proceeds is charged or credited to the Statement of Profit and Loss.

10. Employee Benefits (AS - 15):

• Defined Contribution Plan are post-employment benefit plans under which an enterprise pays fixed contributions into a separate entity (a fund) and will have no obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods.

a. Short-term Employees Benefits

All employee benefits payable within twelve months of rendering the service are classified as short-term benefits. Such benefits include salaries, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc. in the period in which the employee renders the related service. A liability is recognized for the amount expected to be paid when there is a present obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

• Defined Benefit Plan are post-employment benefit plans other than defined contribution plans.

b. Gratuity

The Company provides for Gratuity, covering eligible employees under Company Gratuity Scheme. On reporting date, liabilities with respect to gratuity plan as determined by an independent actuarial valuation and actuarial gains/losses are charged to the Statement of Profit and Loss Account.

c. Leave Encashment

The obligation for Leave Encashment recognised, provided for and paid on yearly basis.

11. Borrowing Cost (AS-16)

Borrowing costs directly attributable to the acquisition, construction or production of an Asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective Asset.

a. Specific Borrowing: -

To the extent the funds are borrowed specifically for the purposes of acquisition, construction or production of a qualifying asset, the amount of borrowing costs to be capitalized on the asset shall be the actual borrowing costs incurred on the funds so borrowed.

b. Other than Specific Borrowing: -

To the extent the funds are borrowed generally and utilized for the purposes of acquisition, construction or production of a qualifying asset, the amount of borrowing costs to be capitalized shall be computed on proportionate basis.

Other Borrowing costs are recognized as an expense in the period in which they are incurred, which are taken as upfront.

12. Segment Reporting (AS - 17)

A reportable segment is a business segment or a geographical segment identified on the basis of foregoing definitions for which segment information is required to be disclosed by this Standard.

The basic factor for Business segment is the nature of the products for the Company. which is a distinguishable component that is engaged in providing an individual product or a group of related products and that is subject to risks and returns that are different from those of other business segments or as a whole business.

The basic factor Geographical segment, for the Company, is relationships between operations in different geographical areas in terms of India and Outside India., which is a distinguishable component that is engaged in providing products or within a particular economic environment and that is subject to risks and returns that are different from those of components operating in other economic environments.

13. Earnings per share (AS - 20):

a. Basic Earnings Per Share

Basic earnings per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the financial year. Earnings considered in ascertaining the company''s earnings per share is the net profit for the period after deducting any attributable tax thereto for 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. (Refer Point No. vi of note 31).

b. Diluted Earnings Per Share

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 is adjusted for the effects of all dilutive potential equity shares.

14. Accounting for taxes on income (AS - 22):

Provision is made for income tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income Tax Act, 1961.

The differences that result between the profit considered for income taxes and the profit as per the financial statements are identified, and thereafter a deferred tax asset or deferred tax liability is recorded for timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted or substantially enacted regulations. Deferred Tax Assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

15. Provisions, contingent liabilities, and contingent assets (AS - 29)

a. Provisions are made for present obligations arising as a result of past events and it is probable that an outflow of resources will be required to settle the obligation.

b. Contingent liabilities are not provided for but are disclosed by way of Notes on Accounts (Refer point no 32. of Notes of accounts).

c. Contingent assets are neither accounted for nor disclosed by way of Notes on Accounts.

16. Leases (AS-19)

The company has non- cancellable operating leases for plant and machinery. The Company recognises the lease payments as an operating expense on a straight-line basis over the lease term.

17. Research & Development Expenses

a. Development and improvement of product is an in-built on-going activity within the existing manufacturing facilities.

b. Expenditure on Research & development is not separately allocated and identified.