Accounting Policies of Velan Hotels Ltd. Company

Mar 31, 2024

3. SignificantAccounting Policies

i) Functional and presentation currency: These financial statements are presented in Indian rupees, the
national currency of India, which is the functional currency of the Company.

ii) Foreign currency transactions and translation: Foreign currency transactions and translation
Transactions in foreign currency are translated into the functional currency using the exchange rates
prevailing at the date of the transaction. Foreign exchange gains and losses resulting from the settlement
of such transactions and from translation at the exchange rates prevailing at the reporting date of
monetary assets and liabilities denominated in foreign currencies are recognized in the statement of profit
and loss and reported within foreign exchange gains/(losses), net within results of operating activities.
Gains/(losses) relating to translation or settlement of borrowings denominated in foreign currency are
reported within finance expense. Nonmonetary assets and liabilities denominated in foreign currency and
measured at historical cost are translated at the exchange rate prevalent at the date of transaction.
Translation differences on nonmonetary financial assets measured at fair value at the reporting date.

iii) Equity

a) Share capital and share premium

The authorized share capital of the Company as of March 31, 2024 and March 31, 2023 is
50,00,00,000 divided into 5,00,00,000 equity shares of'' 10each. Par value of the equity shares is
recorded as share capital and the amount received in excess of par value is classified as share
premium.

Every holder of the equity shares, as reflected in the records of the Company as of the date of the
shareholder meeting shall have one vote in respect of each share held for all matters submitted to
vote in the shareholder meeting.

b) Revaluation Reserve

Revaluation reserve amounting to Rs. 5,64,19,070 (March 31,2023 Rs. 5,70,97,925) is not freely
available for distribution.

c) Retained earnings

Retained earnings comprises of the Company''s undistributed earnings after taxes.

d) Other comprehensive income

Changes in the fair value of financial instruments measured at fair value through other
comprehensive income and actuarial gains and losses on defined benefit plans are recognized in
other comprehensive income (net of taxes), and presented within equity as other comprehensive
income.

iv) Property, plant and equipment

a) Recognition and measurement

Property, plant and equipment are measured at cost less accumulated depreciation and
impairment losses, if any. Cost includes expenditures directly attributable to the acquisition of the
asset. General and specific borrowing costs directly attributable to the construction of a qualifying
asset are capitalized as part of the cost.

b) Depreciation

The Company depreciates property, plant and equipment over the estimated useful life on a
straight-line basis from the date the assets are available for use. Assets acquired under finance
lease and leasehold improvements are amortized over the shorter of estimated useful life of the
asset or the related lease term. Term licenses are amortized over their respective contract term.
Freehold land is not depreciated. The estimated useful life of assets are reviewed and where
appropriate are adjusted, annually.

When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
Subsequent expenditure relating to property, plant and equipment is capitalized only when it is
probable that future economic benefits associated with these will flow to the Company and the cost
of the item can be measured reliably.

The cost of property, plant and equipment not available for use as at each reporting date is
disclosed under capital work- in-progress.

v) Intangible assets

Intangible assets acquired separately are measured at cost of acquisition. Intangible assets acquired in a
business combination are measured atfair value as at the date of acquisition. Following initial recognition,
intangible assets are carried at cost less accumulated amortization and impairment losses, if any.

The amortization of an intangible asset with a finite useful life reflects the manner in which the economic
benefit is expected to be generated. The estimated useful life of amortizable intangibles are reviewed and
where appropriate are adjusted, annually.

vi) Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the
arrangement at the inception date. The arrangement is, or contains a lease if, fulfillment of the
arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to
use the asset or assets, even if that right is not explicitly specified in an arrangement.

a) Arrangements where the Company is the lessee

Leases of property, plant and equipment, where the Company assumes substantially all the risks
and rewards of ownership are classified as finance leases. Finance leases are capitalized at lower
of the fair value of the leased property and the present value of the minimum lease payments. Lease
payments are apportioned between the finance charge and the outstanding liability. The finance
charge is allocated to periods during the lease term at a constant periodic rate of interest on the
remaining balance of the liability.

Leases where the lessor retains substantially all the risks and rewards of ownership are classified
as operating leases. Payments made under operating leases are recognized in the statement of
profit and loss on a straight-line basis over the lease term.

b) Arrangements where the Company is the lessor

In certain arrangements, the Company recognizes revenue from the sale of products given under
finance leases. The Company records gross finance receivables, unearned income and the
estimated residual value of the leased equipment on consummation of such leases. Unearned
income represents the excess of the gross finance lease receivable plus the estimated residual
value over the sales price of the equipment. The Company recognizes unearned income as finance
income overthe lease term using the effective interest method.

vii) Inventories

Inventories are valued at lower of cost and net realizable value, including necessary provision for
obsolescence. Cost includes all direct costs and applicable overheads to bring the goods to present
location and condition.

viii) Impairment

Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are
tested annually for impairment, or more frequently if events or changes in circumstances indicate that they
might be impaired. Other assets are tested for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the
amount by which the asset''s carrying amount exceeds its recoverable amount. The recoverable amount is
the higher of an asset''s fair value less costs of disposal and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from other assets or groups of assets (cash¬
generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for
possible reversal of the impairment at the end of each reporting period.

ix) Employee benefits

a) Post-employment and pension plans

The Company participates in various employee benefit plans. These employment benefits are
classified as either defined contribution plans or defined benefit plans.

Under a defined contribution plan, the Company''s only obligation is to pay a fixed amount with no
obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee
benefits. The related actuarial and investment risks fall on the employee.

The expenditure for defined contribution plans is recognized as an expense during the period when
the employee provides service.

Under a defined benefit plan, it is the Company''s obligation to provide agreed benefits to the
employees. The related actuarial and investment risks fall on the Company. The present value of
the defined benefit obligations is calculated by an independent actuary using the projected unit
credit method. All actuarial gains or losses are immediately recognized in other comprehensive
income, net of taxes and permanently excluded from profit or loss. Further, the profit or loss will no
longer include an expected return on plan assets. Instead net interest recognized in profit or loss is
calculated by applying the discount rate used to measure the defined benefit obligation to the net
defined benefit liability or asset. The actual return on the plan assets above or below the discount
rate is recognized as part of remeasurement of net defined liability or asset through other
comprehensive income, net of taxes.

The Company has the following employee benefit plans:

A. Provident fund

Employees receive benefits from a provident fund, which is a defined benefit plan. The employer
and employees each make periodic contributions to the plan. The contributions to the provident
fund are charged to the statement of profit and loss for the year when the contributions are due.

B. Gratuity

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, the
Company provides for a lump sum payment to eligible employees, at retirement or termination of
employment based on the last drawn salary and years of employment with the Company. The
Company''s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for
based on actuarial valuation using the projected unit credit method. The Company recognizes
actuarial gains and losses in other comprehensive income, net of taxes.

b) Termination benefits

Termination benefits are expensed when the Company can no longer withdraw the offer of those benefits.

c) Short-term benefits

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.

d) Compensated absences

The employees of the Company are entitled to compensated absences. The employees can carryforward
a portion of the unutilized accumulating compensated absences and utilize it in future periods or receive
cash at retirement or termination of employment. The Company records an obligation for compensated
absences in the period in which the employee renders the services that increases this entitlement. The
Company measures the expected cost of compensated absences as the additional amount that the
Company expects to pay as a result of the unused entitlement that has accumulated at the end of the
reporting period. The Company recognizes accumulated compensated absences based on actuarial
valuation using the projected unit credit method.

Non-accumulating compensated absences are recognized in the period in which the absences occur.

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Mar 31, 2015

A) Basis of Presentation :

The financial statements have been prepared under the historical cost convention, on an accrual basis and in accordance with generally accepted accounting principles generally accepted in Indian (Indian GAAP) and comply with mandatory Accounting Standards notified by the Central Government of India under the Companies (Accounting Standard) Rules 2006 and the relevant provisions of the Companies Act to the extent applicable except for certain fixed assets which have been revalued. The Accounting is on the basis of a going concern concept.

b) Revenue Recognition :

Income from guest accommodation is recognized on a day to day basis after the guest checks into the hotel. Sale of food and beverage is recognized at the point of serving those items to the guest. Sales exclude amount recovered towards taxes.

c) Foreign Currency Transactions :

Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate prevailing at the time of transaction. Closing balances of current assets and current liabilities are converted at the rates of exchange prevailing at the end of the year. Any increase/decrease arising out of the above is adjusted to the Profit and Loss Account.

d) Fixed Assets

Fixed Assets are stated at historical cost of acquisition, which is inclusive of freight, installation charges and other incidental expenses or at revalued amounts wherever such assets have been revalued.

Advances paid towards the acquisition of fixed assets outstanding at each balance sheet date are disclosed as "Capital Advances" under Long Term Loans and Advances and cost of fixed assets not ready to use before such date is disclosed under "Capital-Work-in-Progress"

e) Depreciation

a. Depreciation is provided under Straight Line Method on assets on pro-rata basis at the rates specified in Schedule II to the Companies Act, 2013.

b. Depreciation on assets revalued in the year is calculated on its revalued figure on Straight Line Method at the rates specified in Schedule II to the Companies Act, 2013. The additional charge of depreciation on account of revaluation is deducted from revaluation reserve and credited to the Profit and Loss Account.

f) Valuation of Inventory :

Provisions and Supplies are valued at cost or net realizable value. Cost Includes all direct costs and applicable overheads to bring the goods to the present location and condition. Wherever the net realizable value is less than such cost, the net realizable value is adopted for valuation.

g) Employee Benefits

1. Defined Contribution Plan

Contributions to Provident and Other Statutory Funds are recognized in the Profit & Loss Account

2. Defined Benefit Plan

Company's liabilities towards Gratuity and Leave Encashment are determined on actuarial valuation basis. Obligation is measured at the year end as present value of future cash flows using a discounted rate.

3. Short Term Benefits

Short term employee benefits are recognized as expenses as per the Company's scheme based on expected obligation on undiscounted basis.

h) Contingencies and events occurring after the date of Balance sheet

Events, where material, occurring after the date of the balance sheet are considered upto the date of approval of accounts

i) Contingent Liabilities

Contingent liabilities are not recognized, but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

j) Net Profit for the period, Prior period items and changes in Accounting Polices

Prior period adjustments and extraordinary items having material impact on the financial affairs of the company are disclosed separately.

k) Borrowing Cost

Borrowing costs are capitalized as part of qualifying fixed assets when it is possible that they will result in future economic benefits. Other borrowing costs are expensed.

l) Taxation

Current tax is determined as the amount of tax payable in respect of taxable income for the year based on applicable tax rates and laws. Deferred Tax is recognized subject to consideration of prudence in respect of deferred tax assets, on timing difference, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. At the year end, deferred tax assets and deferred tax liabilities are netted of in the balance sheet.

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Mar 31, 2012

A) Basis of Presentation :

The financial statements have been prepared under the historical cost convention, on an accrual basis and in accordance with generally accepted accounting principles generally accepted in Indian (Indian GAAP) and comply with mandatory Accounting Standards notified by the Central Government of India under the Companies (Accounting Standard) Rules 2006 and the relevant provisions of the Companies Act, 1956 to the extent applicable except for certain fixed assets which have been revalued. The Accounting is on the basis of a going concern concept.

b) Revenue Recognition :

Income from guest accommodation is recognized on a day to day basis after the guest checks into the hotel. Sale of food and beverage is recognized at the point of serving those items to the guest. Sales exclude amount recovered towards taxes.

c) Foreign Currency Transactions :

Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate prevailing at the time of transaction. Closing balances of current assets and current liabilities are converted at the rates of exchange prevailing at the end of the year. Any increase/decrease arising out of the above is adjusted to the profit and loss account.

d) Fixed Assets

Fixed Assets are stated at historical cost of acquisition, which is inclusive of freight, installation charges and other incidental expenses or at revalued amounts wherever such assets have been revalued.

Advances paid towards the acquisition of fixed assets outstanding at each balance sheet date are disclosed as "Capital Advances" under Long Term Loans and Advances and cost of fixed assets not ready to use before such date are disclosed under "Capital-Work-in-Progress"

e) Deprecation

a. Deprecation is provided under straight line method on assets on pro-rata basis at the rates specified in Schedule XIV to the Companies Act, 1956.

b. Deprecation on assets revalued in the year is calculated on its revalued figure on Straight Line Method at the rates specified in Schedule XIV to the Companies Act, 1956. The additional charge of depreciation on account of revaluation is deducted from revaluation reserve and credited to the Profit and Loss Account.

c. Assets costing less than Rs. 5000 are fully depreciated in the year of addition.

f) Valuation of Inventory :

Provisions and Supplies are valued at cost or net realizable value. Cost Includes all direct costs and applicable overheads to bring the goods to the present location and condition. Wherever the net realizable value is less than such cost, the net realizable value is adopted for valuation.

g) Employee Benefits

1. Defined Contribution Plan

Contributions to Provident and Other Statutory Funds are recognized in the Profit & loss account

2. Defined Benefit Plan

Company's liabilities towards gratuity and leave encashment are determined on actuarial valuation basis. Obligation is measured at the year end as present value of future cash flows using a discounted rate.

3. Short Term Benefits

Short term employee benefits are recognized as expenses as per the company's scheme based on expected obligation on undiscounted basis.

h) Contingencies and events occurring after the date of Balance sheet

Events, where material, occurring after the date of the balance sheet are considered upto the date of approval of accounts

i) Contingent Liabilities

Contingent liabilities are not recognized, but are disclosed in the notes. Contigent assets are neither recognized nor disclosed in the financial statements.

j) Net Profit for the period, Prior period items and changes in Accounting Polices

Prior period adjustments and extraordinary items having material impact on the financial affairs of the company are disclosed separately.

k) Borrowing Cost

Borrowing costs are capitalized as part of qualifying fixed assets when it is possible that they will result in future economic benefits. Other borrowing costs are expensed.

m) Taxation

Current tax is determined as the amount of tax payable in respect of taxable income for the year based on applicable tax rates and laws. Deferred Tax is recognized subject to consideration of prudence in respect of deferred tax assets, on timing difference, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. At the year end, deferred tax assets and deferred tax liabilities are netted off in the balance sheet.

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Mar 31, 2011

1. Basis of Presentation:

The financial statements have been prepared under the historical cost convention, on an accrual basis and in accordance with generally accepted accounting principles generally accepted in Indian (Indian GAAP) and comply with mandatory Accounting Standards notified by the Central Government of India under the Companies (Accounting Standard) Rules 2006 and the relevant provisions of the Companies Act, 1956 to the extent applicable except for certain fixed assets which have been revalued. The accounting is on the basis of a going concern concept.

2. Revenue Recognition:

Income from guest accommodation is recognized on a day to day basis after the guest checks into the hotel. Sale of food and beverage is recognized at the point of serving those items to the guest. Sales exclude amount recovered towards taxes.

3. Foreign Currency Transactions :

Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate prevailing at the time of transaction. Closing balances of current assets and current liabilities are converted at the rates of exchange prevailing at the end of the year. Any increase/decrease arising out of the above is adjusted to the profit and loss account.

4. Fixed Assets

Fixed Assets are stated at historical cost of acquisition, which is inclusive of freight, installation charges and other incidental expenses or at revalued amounts wherever such assets have been revalued.

5. Deprecation

a. Deprecation is provided under straight line method on assets on pro-rata basis at the rates specified in Schedule XIV to the Companies Act, 1956.

b. Deprecation on assets revalued in the year is calculated on its revalued figure on Straight Line Method at the rates specified in Schedule XIV to the Companies Act, 1956. The additional charge of depreciation on account of revaluation is deducted from revaluation reserve and credited to the Profit and Loss Account.

6. Valuation of Inventory:

Provisions and Supplies are valued at cost or net realizable value. Cost Includes all direct costs and applicable overheads to bring the goods to the present location and condition. Wherever the net realizable value is less than such cost, the net realizable value is adopted for valuation.

7. Employee Benefits

1. Defined Contribution Plan

Contributions to Provident and Other Statutory Funds are recognized in the Profit & loss account

2. Defined Benefit Plan

Company's liabilities towards gratuity and leave encashment are determined on actuarial valuation basis. Obligation is measured at the year end as present value of future cash flows using a discounted rate.

8. Contingencies and events occurring after the date of Balance sheet

Events, where material, occurring after the date of the balance sheet are considered upto the date of approval of accounts

9. Contingent Liabilities

Contingent liabilities are not provided for in the books of accounts. However these have been disclosed by way of a note.

10. Net Profit for the period, Prior period items and changes in Accounting Polices

Prior period adjustments and extraordinary items having material impact on the financial affairs of the company are disclosed separately.

11. Borrowing Cost

Borrowing costs are capitalized as part of qualifying fixed assets when it is possible that they will result in future economic benefits. Other borrowing costs are expensed.

12. Taxation

Current tax is determined as the amount of tax payable in respect of taxable income for the year based on applicable tax rates and laws. Deferred Tax is recognized subject to consideration of prudence in respect of deferred tax assets, on timing difference, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. At the year end, deferred tax assets and deferred tax liabilities are netted of in the balance sheet.

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Mar 31, 2010

1. Basis of Presentation :

The financial statements have been prepared under the historical cost convention, on an accrual basis and in accordance with generally accepted accounting principles generally accepted in India (Indian GAAP) and comply with mandatory Accounting Standards notified by the Central Government of India under the Companies (Accounting Standard) Rules 2006 and the relevant provisions of the Companies Act,1956 to the extent applicable except for certain fixed assets which have been revalued. The Accounting is on the basis of a going concern concept.

2. Revenue Recognition :

Income from guest accommodation is recognized on a day to day basis after the guest checks into the hotel. Sale of food and beverage is recognized at the point of serving those items to the guest. Sales exclude amount recovered towards taxes.

3. Foreign Currency Transactions :

Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate prevailing at the time of transaction. Closing balances of current assets and current liabilities are converted at the rates of exchange prevailing at the end of the year. Any increase/decrease arising out of the above is adjusted to the profit and loss account.

4. Fixed Assets

Fixed Assets are stated at historical cost of acquisition, which is inclusive of freight, installation charges and other incidental expenses or at revalued amounts wherever such assets have been revalued.

5. Deprecation

a. Deprecation is provided under straight line method on assets on pro-rata basis at the rates specified in Schedule XIV to the Companies Act, 1956.

b. Deprecation on assets revalued in the year is calculated on its revalued figure on Straight Line Method at the rates specified in Schedule XIV to the Companies Act, 1956. The additional charge of depreciation on account revaluation is deducted from revaluation reserve and credited to the Profit and Loss Account.

6. Valuation of Inventory :

Provisions and Supplies are valued at cost or net realizable value. Cost Include all direct costs and applicable overheads to bring the goods to the present location and condition. Wherever the net realizable value is less than such cost, the net realizable value is adopted for valuation.

7. Employee Benefits

1. Defined Contribution Plan

Contributions to Provident and other Statutory Funds are recognized in the Profit & loss account

2. Defined Benefit Plan

Companys liabilities towards gratuity and leave encashment are determined on actuarial valuation basis. Obligation is measured at the year end as present value of future cash flows using a discounted rate.

8. Contingencies and events occurring after the date of Balance sheet

Events, where material, occurring after the date of the balance sheet are considered upto the date of approval of accounts

9. Contingent Liabilities

Contingent liabilities are not provided for in the books of accounts. However these have been disclosed by way of a note.

10. Net Profit for the period, Prior period items and changes in Accounting Polices Prior period adjustments and extraordinary items having material impact on the financial affairs of the company are disclosed separately.

11. Borrowing Cost

Borrowing costs are capitalized as part of qualifying fixed assets when it is possible that they will result in future economic benefits. Other borrowing costs are expensed.

12. Taxation

Current tax is determined as the amount of tax payable in respect of taxable income for the year based on applicable tax rates and laws. Deferred Tax is recognized subject to consideration of prudence in respect of deferred tax assets, on timing difference, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. At the year end, deferred tax assets and deferred tax liabilities are netted of in the balance sheet.