Accounting Policies of Brilliant Portfolios Ltd. Company

Mar 31, 2024

Note 2: SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of Preparation of Financial Statements

The financial statements of the company have been prepared in accordance with Indian Accounting Standards
(Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 read with section 133 of the
Companies Act, 2013(as amended from time to time) and relevant presentation requirements of the Companies
Act 2013.

The financial statements have been prepared in accordance with the Indian Accounting Standards (Ind AS) on
the historical cost basis except for certain financial instruments that fair value measured at fair values at the end
of each reporting period as explained in the accounting policies and the relevant provisions of the Act.

Accounting policies have been consistently applied except where a newly-issued accounting standard is initially
adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in
use.

The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the
accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that
require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

The financial statements are presented in Indian Rupees (INR) and all values are rounded to two decimal
thousands except when otherwise indicated.

2.2 Presentation of Financial Statements

The financial statements of the Company are presented as per Schedule III (Division III) of the Companies Act,
2013 (the Act) applicable to NBFCs, as notified by the Ministry of Corporate Affairs (MCA). Financial assets and
financial liabilities are generally reported on a gross basis except when, there is an unconditional legally
enforceable right to offset the recognised amounts without being contingent on a future event and the parties
intend to settle on a net basis in the following circumstances:

i. The normal course of business

ii. The event of default

iii. The event of insolvency or bankruptcy of the Company and / or its counterparties

2.3 Financial Instruments

A financial instrument is a contract that gives rise to a financial asset for one entity and a financial liability or
equity instrument for another entity. Financial assets and financial liabilities are recognised when the Company
becomes a party to the contractual provisions of the instruments.

Trade receivables are initially recognised when they are originated. All other financial assets and financial
liabilities are initially recognised when the Company becomes a party to the contractual provisions of the
instrument. A financial asset is initially recognised at fair value. In case of financial assets which are recognised
at fair value through profit and loss (FVTPL), its transaction cost are recognised in the statement of profit and
loss. In other cases, the transaction cost are attributed to the acquisition value of the financial asset.

Classification and Subsequent Measurement

Financial Assets
Subsequent Measurement

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

-Financial Asset carried at amortised cost

-Financial Asset at fair value through other comprehensive income (FVTOCI)

-Financial Asset at fair value through profit and loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the
Company changes its business model for managing financial assets.

Financial Asset carried at Amortised Cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose
objective is to hold the asset 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.

Financial Asset at Fair Value Through Other Comprehensive Income (FVTOCI)

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within
a business model whose objective is achieved by both collecting contractual cash flows and selling 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.

Financial Asset at Fair Value Through Profit and Loss (FVTPL)

A financial asset which is not classified in any of the above categories are subsequently fair valued through
profit or loss.

Equity Instruments

All equity investments in the scope of Ind AS 109 are measured at fair value.

For all other equity instruments, the Company may make an irrevocable election to present in other
comprehensive income subsequent changes in the fair value. The Company makes such election on an
instrument by- instrument basis. The classification is made on initial recognition and is irrevocable. If the
Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument,
excluding dividends, are recognized in the OCI. There is no recycling of the amounts from OCI to statement of
profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss
within equity. Equity instruments included within the FVTPL category are measured at fair value with all
changes recognized in the statement of Profit and Loss.

A financial asset (or, where applicable, a part of a financial asset) is primarily derecognised (i.e. removed from
the Company''s Balance Sheet) when:

(i) The contractual rights to receive cash flows from the asset has expired, or

(ii) The Company has transferred its contractual rights to receive cash flows from the financial asset or has
assumed an obligation to pay the received cash flows in full without material delay to a third party under a
‘pass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards
of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of
the asset, but has transferred control of the asset.

Financial Liabilities

Initial Recognition and Measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss. 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. The Company''s financial liabilities include trade payables,
borrowings etc.

For purposes of subsequent measurement, financial liabilities are classified in two categories:

- Financial liabilities at amortised cost

- Financial liabilities at fair value through profit and loss (FVTPL)

Financial Liabilities at Amortized cost

Loans and Borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost
using the EIR method. Gains and losses are recognised in the statement of profit or loss when the liabilities are
derecognised as well as through the EIR amortisation process.

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. This category generally applies to borrowings.

De-Recognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
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 the
de-recognition of the original liability and the recognition of a new liability. The difference in the respective
carrying amounts is recognised in the statement of profit and loss.

Offsetting of 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 recognized amounts and there is an intention to settle on a net
basis, to realize the assets and settle the liabilities simultaneously

Impairment of Financial Assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected
loss rates. The Company uses judgments in making these assumptions and selecting the inputs to the

impairment calculation, based on Company''s past history, existing market conditions as well as forward looking
estimates at the end of each reporting period.

Impairment of Non-Financial Assets

The carrying amounts of the Company''s non-financial assets, other than deferred tax assets, are reviewed at
the end of each reporting period to determine whether there is any indication of impairment. If any such
indication exists, then the asset''s recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit (‘CGU'') is the greater of its value in use or its fair
value less costs to sell. 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 of money
and the risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested
individually 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 groups of assets (‘CGU'').

An impairment loss is recognized, if the carrying amount of an asset or its CGU exceeds its estimated
recoverable amount and is recognised in statement of profit and loss.

Impairment losses recognised in prior periods are assessed at end of each reporting period for any indications
that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in
the estimates used to determine the recoverable amount. An impairment loss is reversed 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.

Fair Value Measurement

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:

(a) In the principal market for the asset or liability, or

(b) In the absence of a principal market, in the most advantageous market for the asset or liability

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 (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement

is directly or indirectly observable

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable

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

2.4 Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and
the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or
receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected
on behalf of the government.

The specific recognition criteria described below must also be met before revenue is recognised.

Sale of Shares

Revenue from sale of shares is recognized when all the significant risks and rewards of ownership of the traded
goods have been passed to the buyer.

Interest Income

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the
applicable interest rate. Further, in accordance with the guidelines issued by the Reserve Bank of India for Non¬
Banking Finance Companies, income on business assets classified as Non-performing Assets, is also
recognized on receipt basis.

Dividend Income

Dividend income is accounted as and when right to receive dividend is established.

2.5 Net gain on Fair value changes

Any differences between the fair values of financial assets classified as "Fair Value Through Profit or Loss" held
by the company on the reporting date is recognised as an unrealised gain / loss in the statement of profit and
loss. In cases there is a net gain in the aggregate, the same is recognised in “Net gains on fair value changes”
under Revenue from operations and if there is a net loss the same is disclosed as “Net loss on fair value
changes” under Expenses in the Statement of Profit and Loss.

2.6 Finance Costs

Finance Costs on borrowings is paid towards availing of loan, is amortised on EIR basis over the life of loan.
The EIR in case of a financial liability is computed

a. As the rate that exactly discounts estimated future cash payments through the expected life of the financial
liability to the gross carrying amount of the amortised cost of a financial liability.

b. By considering all the contractual terms of the financial instrument in estimating the cash flows.

c. including all fees paid between parties to the contract that are an integral part of the effective interest rate,
transaction costs, and all other premiums or discounts.

Any subsequent changes in the estimation of the future cash flows are recognised in interest expense with the
corresponding adjustment to the carrying amount of the liability.

Interest expense includes issue costs that are initially recognized as part of the carrying value of the financial
liability and amortized over the expected life using the effective interest method. These include fees and
commissions payable to advisers and other expenses such as external legal costs. Rating Fees etc, provided
these are incremental costs that are directly related to the issue of a financial liability.

2.7 Employee''s Benefits

Benefits such as salaries, wages and short-term compensated absences, bonus and ex-gratia etc. are
recognised in statement of profit and loss in the period in which the employee renders the related service.

2.8 Taxes

Current Income Tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax reflects

the best estimate of the tax amount expected to be paid or received after considering the uncertainty, if any,
related to income taxes. It is measured using tax rates (and tax law) enacted or substantively enacted by the
reporting date.

Deferred Tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences, and the carry forward of
unused tax credits and unused tax losses can be utilised, except when the deferred tax asset relating to the
deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is
not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable
profit or loss. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset
to be recovered.

Deferred tax assets and liabilities are recognised for temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts. Deferred income tax is determined using tax rates (and laws)
that are enacted or substantively enacted by the reporting date and expected to apply when the related deferred
income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are only recognised for temporary differences, unused tax losses and unused tax credits if
it is probable that future taxable amounts will arise to utilise those temporary differences and losses. Deferred
tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realised.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same
taxation authority.

2.9 Cash and Cash Equivalents

Cash and cash equivalent comprise the net amount of short term, highly liquid investments that are readily
convertible to known amounts of cash (short-term deposits with an original maturity of three months or less) and
are subject to an insignificant risk of change in value. They are held for the purpose of meeting short term cash
commitments (rather than for investment or other purposes).

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term
deposits, as defined above.

2.10 Property, Plant and Equipment

Property, plant and equipment (PPE) are measured at cost less accumulated depreciation and accumulated
impairment, if any. The total cost of assets comprises its purchase price, freight, duties, taxes and any other
incidental expenses directly attributable to bringing the asset to the location and condition necessary for it to be
capable of operating in the manner intended by the management. Changed in expected useful life are
accounted for by changing the amortisation period or methodology, as appropriate, and treated as changes in
accounting estimates.

Subsequent expenditure related to an item of tangible asset are added to its gross value only if it increases the
future benefits of the existing asset, beyond its previously assessed standards of performance and cost can be

measured reliably. Other repairs and maintenance costs are expensed off as and when incurred.

Depreciation

Depreciation is calculated using the written down value method to write down the cost of property and
equipment to their residual values over their estimated useful lives which is in line with the estimated useful life
as specified in Schedule II of the Act. The estimated useful lives are as prescribed by Schedule II of the Act.
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

Property plant and equipment is derecognised on disposal or when no future economic benefits are expected
from its use. 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 recognised in other income / expense in the
statement of profit and loss in the year the asset is derecognised. The date of disposal of an item of property,
plant and equipment is the date the recipient obtains control of that item in accordance with the requirements for
determining when a performance obligation is satisfied in Ind AS 115.

2.11 Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence,
wherever considered necessary. Cost of inventories comprises of cost of purchase, cost of conversion and
other costs including manufacturing overheads incurred in bringing them to their respective present location and
condition.

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Mar 31, 2015

1) Basis of Preparation of Financial Statements

India (Indian GAAP), including the Accounting Standards notified under the relevant provisions of the Companies Act, 2013

The financial statements are prepared on accrual basis under the historical cost convention.

2) Use of Estimates

The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and assumptions that affect the reported amounts of income and expenses of the year, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of tangible and intangible fixed assets, provision for doubtful debts/advances, future obligations in respect of retirement benefit plans etc. Actual results could differ from these estimates and would be recognized in the period in which the results are known.

3) Revenue Recognition

Revenue is recognized on the nature of activity when consideration can be reasonably measured and there exists reasonable certainty of its recovery

(i) Revenue from sale of goods is recognised when the substantial risks and rewards of ownership is transferred to buyer under the terms of contract.

(ii) Other income is accounted on accrual basis as and when the right to receive arises.

4) Fixed Assets Tangible

Fixed assets are stated at cost of acquisition, less accumulated depreciation thereon. For this purpose, cost includes purchase price and all other attributable costs of bringing the assets to working condition for intended use. Assessment of indication of impairment of an asset is made at the year end and impairment loss, if any is recognized.

5) Depreciation

Depreciation on Fixed Assets is provided to the extent of depreciable amount on the Written Down Value (WDV) Method. Depreciation is provided based on useful life of the assets as prescribed in Schedule II of the Companies Act, 2013.

The written down value of Fixed Assets whose lives have expired as at 1 st April 2014 have been adjusted in the opening balance of Profit and Loss Account.

6) Valuation of Inventories

Stock of securities and work in progress has been valued at cost.

7) Employee Benefits

Providend fund is accounted for on actual basis.

8) Taxes on Income

Tax on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961, and based on expected outcome of assessments / appeals. Deferred tax is recognized on timing differences between the accounting income and the taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

9) Impairment of Assets

As at each Balance Sheet date, the carrying amount of assets is tested for impairment so as to determine :

i) The provision for impairment loss, if any required; or

ii) The reversal, if any, required of impairment loss recognized in previous period.

Impairment loss is recognized when the carrying amount of assets exceeds its recoverable amount. Recoverable amount is determined:

i) In the case of individual assets, at the higher of the net selling price and the value in use;

ii) In the cash generating unit (a group of assets that generates identified, independent cash flows), at the higher of cash generating unit's net selling price and the value in use;

(Value in use is determined as the present value of estimated future cash flows from the continuing use of an asset from its disposal at the end of its useful life)

10) Provisions, Contingent Liabilities and Contingent Assets

a) Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if(i) the Company has a present obligation as a result of a past event.(ii) a probable outflow of resources is expected to settle the obligation, and(iii) the amount of the obligation can be reliably estimated.b) Reimbursement expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received.c) Contingent Liability is disclosed in the case of a. a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation.b. a present obligation when no reliable estimate is possible, and c. a possible obligation arising from past events where the probability of outflow of resources is not remote.d) Contingent Assets are neither recognized, nor disclosed.e) Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

11) Claims

Claims against / by the company are accounted for on acceptance / receipt of the same.