Notes to Accounts of Trans Freight Containers Ltd.

Mar 31, 2024

(h) Provisions, Contingent Liabilities and Commitments

A provision is recognized if, as a result of a past event, the company has a present legal
or constructive obligation that is reasonably estimable, and it is probable that an outflow
of economic benefits will be required to settle the obligation. Provisions are determined
by discounting the expected future cash flows at a pre-tax rate that reflects current market
assessments of the time value of money and the risks specific to the liability.

Contingent liability is disclosed in the case of:

- a present obligation arising from past events, when it is not probable that an outflow of
resources will be required to settle the obligation;

- a present obligation arising from past events, when no reliable estimate is possible;

- a present obligation arising from past events, unless the probability of outflow of resources
is remote.

Commitments include the amount of purchase order(net of advances) issued to parties for
completion of assets.

Provisions, contingent liabilities, contingent assets and commitments are reviewed at each
balance sheet date.

(i) Employee benefits

(i) Short-term obligations

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

(ii) Provident Fund

The Company pays provident fund contributions to publicly administered provident funds
as per local regulations. The Company has no further payment obligations once the
contributions have been paid. The contributions are accounted for as defined contribution
plans and the contributions are recognised as employee benefit expense when they are
due.

(j) Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the
effects of transactions of non cash nature and any deferrals or accruals of past or future cash
receipts or payments. The cash flows from operating, investing and financing activities of the
group are segregated based on available information.

(k) Current/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

The company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

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

(l) Earnings per share

Basicearnings perequityshareiscomputed by dividingthe net profitattributabletotheequity holders
of the company by the weighted average number of equity shares outstanding during the year.
Diluted earnings per equity share is computed by dividing the net profit attributable to the equity
holders, after income tax effect of interest and other financing costs associated with dilutive
potential equity, by the 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.

3 Significant accounting judgments, estimates and assumptions

The preparation of the financial statements in conformity with Ind AS requires management to make
estimates, judgments and assumptions. These estimates, judgments and assumptions affect the
application of 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 period. Application of accounting policies that require critical accounting
estimates involving complex and subjective judgments and the use of assumptions in these financial
statements have been disclosed below. Accounting estimates could change from period to period. Actual
results could differ from those estimates. Appropriate changes in estimates are made as management
becomes aware of changes in circumstances surrounding the estimates. Changes in estimates 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.

The areas involving critical accounting estimates or judgments are:

- Estimated fair value of unlisted securities - Note 27

- Estimated useful life of tangible asset - Note 4

- Impairment of non-financial assets - Note 28

Level 3 - If one or more of the significant inputs are not based on observable market data, the instrument is
included in level 3. This is the case for unlisted equity shares, contingent consideration and indemnification
assets included in level 3.

iii. Valuation technique used to determine fair value

Specific Valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis

iv. Valuation inputs and relationships to fair value

The fair values of the unquoted equity shares have been estimated using a discounted cash flow
model. The valuation requires management to make certain assumptions about the model inputs,
including forecast cash flows, discount rate, credit risk and volatility, the probabilities of the various
estimates within the range can be reasonably assessed and are used in management''s estimate of fair
value for these unquoted equity investments.

v. Valuation processes

The finance department of the Company performs the valuations of financial assets and liabilities
required for financial reporting purposes, including level 3 fair values. The department reports directly
to the chief financial officer (CFO) and the audit committee. Discussions of valuation processes and
results are held between the CFO, Audit Committee and the valuation team periodically.

vi. Reconciliation of fair value measurement of financial assets carried at fair value (Level 3):

There is no change in fair value of unquoted equity shares.

28. FINANCIAL RISK MANAGEMENT

The company’s activity expose it to market risk, liquidity risk and credit risk. In order to minimise any
adverse effects on the financial performance of the company, derivative financial instruments, such
as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures.
Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.
This note explains the sources of risk which the entity is exposed to and how the entity manages the
risk.

(A) Credit risk

Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss.
Credit risk arises from cash and cash equivalents, investments carried at amortised cost and deposits
with banks and financial institutions, as well as credit exposures to customers including outstanding
receivables.

i. Credit risk management

Credit risk has always been managed by the company through credit approvals, obtaining
credit reports, establishing credit limits, taking credit limits and continuously monitoring the
creditworthiness of customers to which the company grants credit terms in the normal course of
business.

The company considers the probability of default upon initial recognition of asset and whether
there has been a significant increase in credit risk on an ongoing basis throughout each reporting
period. To assess whether there is a significant increase in credit risk the group compares the
risk of a default occurring on the asset as at the reporting date with the risk of default as at the
date of initial recognition. It considers available reasonable and supportive forwarding-looking
information.

A default on a financial asset is when the counterparty fails to make contractual payments of when
they fall due. This definition of default is determined by considering the business environment in
which entity operates and other macro-economic factors.

ii. Provision for expected credit losses

The company follows ''simplified approach’ for recognition of impairment loss allowance on Trade
receivables.

As a practical expedient, the Company uses a provision matrix to determine impairment loss
allowance on portfolio of its trade receivables. The provision matrix is based on its historically
observed default rates over the expected life of the trade receivables and is adjusted for forward¬
looking estimates. At every reporting date, the historical observed default rates are updated and
changes in the forward-looking estimates are analyzed.

(B) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and
the availability of funding through an adequate amount of committed credit facilities to meet obligations
when due and to close out market positions. Due to the dynamic nature of the underlying businesses,
company maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the company’s liquidity position (comprising the undrawn
borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition,
the company''s liquidity management policy involves projecting cash flows in major currencies and
considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios
against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities

The tables below analyse the company''s financial liabilities into relevant maturity groupings based on
their contractual maturities for:

- all non-derivative financial liabilities, and

- net and gross settled derivative financial instruments for which the contractual maturities are essential
for an understanding of the timing of the cash flows.

The table have been drawn up based on the undiscounted cash flows of financial liabilities based
on the earliest date on which the Company can be required to pay. In the table below, borrowings
include both interest and principal cash flows. To the extent that the interest rates are floating rate, the
undiscounted amount is derived from interest rate curves at the end of the reporting period.

(C) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of change in market prices. Market risk comprises three types of risk: foreign currency risk,
interest rate risk and other price risk such as equity price risk and commodity price risk.

(iii) Price risk

Commodity price risk - The company is not affected by the price volatility of commodities as its
operating activities does not require the purchase of any commodity and as such the company is
not exposed to commodity price risk.

Equity / Units price risk - The company’s exposure to listed and unlisted equity / debt securities
price risk arises from investments held by the company and classified in the balance sheet as fair
value through profit or loss.

To manage its price risk arising from investments in equity securities, the company diversifies its
portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.
Reports on the equity / debt portfolio are submitted to the company''s senior management on a
regular basis. The majority of the company’s equity / debt investments are publicly traded.

Equity / debt price sensitivity

The analysis is based on the assumption that the stock market index had increased by 1% or
decreased by 1% with all other variables held constant, and that all the company''s equity / debt
instruments moved in line with the index.

29. CAPITAL MANAGEMENT

For the purpose of the company''s capital management, capital includes issued equity capital, share premium
and all other equity reserves attributable to the equity holders of the parent. The primary objective of the
Company''s capital management is to maximise the shareholders value.

The company manages its capital structure and makes adjustments in light of changes in economic
conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the
company may adjust the dividend payment to shareholders, return capital to shareholders or issue new
shares. The company monitors capital using a gearing ratio, which is Total outside liabilities (TOL) divided
by Total net worth (TNW). TOL includes interest bearing loans and borrowings, trade and other payables,
less cash and cash equivalents.

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Mar 31, 2014

Not Available.

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Mar 31, 2012

1. Previous year’s figures have been regrouped and / or reclassified wherever necessary to make comparable with those of the current year.

2. The amount spent on Capital Work in Progress during the year ended 31st March, 2012 is Rs. Nil (Previous Year Rs. Nil)

The amount spent on erection of Plant & Machinery during the year ended 31st March, 2012 is Rs. Nil (Previous Year Rs. Nil). An amount of Rs. Nil (Previous Year Rs. Nil) has been capitalised during the year and Rs. 94.01 of prior years is still under erection.

3. For the year ended 31st March, 2012, an amount of Rs. Nil has been transferred to Profit & Loss Appropriation Account from General Reserve (Previous Year Rs. Nil).

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Mar 31, 2011

1. Previous year's figures have been regrouped and/or reclassified wherever necessary to make comparable with those of the current year.

2. The amount spent on Capital work in progress during the year ended 31st March, 2011 was Rs. Nil (Previous Year Rs. Nil). The amount spent on erection of Plant & Machinery during the year ended 31st March, 2011 is Rs.Nil (Previous Year Rs.Nil). An amount of Rs.Nil (Previous Year Rs. Nil) has been capitalized during the year and Rs. 94.01lacs of prior years is still under erection.

3. For the year ended 31st March, 2011, an amount of Rs. Nil has been transferred to Profit & Loss Appropriation Account from General Reserve (Previous Year Rs. Nil).

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Mar 31, 2010

1. Previous years figures have been regrouped and/or reclassified wherever necessary to make comparable with those of the current year.

2. The amount spent on Capital work in progress during the year ended 31st March, 2010 was Rs. Nil ( Previous Year Rs. Nil).

The amount spent on erection of Plant & Machinery during the year ended 31st March, 2010 is Rs.Nil (Previous Year Rs.Nil). An amount of Rs.Nil (Previous Year Rs. Nil) has been capitalized during the year and Rs. 94.01lacs of prior years is still under erection.

3. For the year ended 31st March, 2010, an amount of Rs. Nil has been transferred to Profit & Loss Appropriation Account from General Reserve ( Previous Year Rs. Nil ).

As per our report of even date

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Mar 31, 2009

1. Previous years figures have been regrouped and/or reclassified wherever necessary to make comparable with those of the current year.

2. The amount spent on Capital work in progress during the year ended 31st March, 2009 was Rs. Nil (Previous Year Rs. Nil)

The amount spent on erection of Plant & Machinery during the year ended 31st March, 2009 is Rs. Nil (Previous Year Rs. Nil). An amount of Rs. Nil (Previous Year Rs. Nil) has been capitalised during the year and Rs. 94.01 lacs of prior year is still under erection.

3. For the year ended 31st March, 2009, an amount of Rs. Nil has been transferred to Profit & Loss Appropriation Account from General Reserve (Previous Year Rs. Nil).