Accounting Policies of Vishnu Prakash R Punglia Ltd. Company

Mar 31, 2025

2.2 Material accounting policies

A. Property, plant and equipment
Recognition and Measurement

Property, plant and equipment are stated at cost,
net of accumulated depreciation and accumulated
impairment losses, if any. Freehold land is stated
at cost.

The cost of an item of property, plant and
equipment comprises:

a) its purchase price, including non-refundable
purchase taxes, after deducting trade
discounts and rebates.

b) any costs 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.

c) the initial estimate of the costs of dismantling
and removing the item and restoring the site
on which it is located.

If significant parts of an item of property, plant
and equipment have different useful lives, then
they are accounted for as separate items (major
components) of property, plant and equipment
and depreciated accordingly.

Subsequent expenditure

Subsequent expenditure is capitalised only if it
is probable that the future economic benefits
associated with the expenditure will flow to the
Company.

Transition to Ind AS

On transition to Ind AS, the Company has elected
to continue with the carrying value of all of its
property, plant and equipment measured as per
the previous GAAP and use that carrying value
as the deemed cost of the property, plant and
equipment.

Depreciation methods, estimated useful lives
and residual value

Depreciation is calculated on written down
value basis using the useful lives as prescribed
under Schedule II to the Companies Act, 2013.
If the management''s estimate of the useful
life of a property plant & equipment at the time
of acquisition of the asset or of the remaining
useful life on a subsequent review is shorter
than that envisaged in the aforesaid schedule,
depreciation is provided at a higher rate based
on the management’s estimate of the useful life/
remaining useful life.

Depreciation on additions during the year is
provided on pro rata basis with reference to
month of addition/installation.

The property, plant and equipment acquired under
finance leases is depreciated over the asset’s
useful life or over the shorter of the asset’s useful
life and the lease term if there is no reasonable
certainty that the company will obtain ownership
at the end of the lease term. Leasehold land is
amortised on a straight-line basis over the balance
period of lease.

The residual values are not more than 5% of the
original cost of the asset.

Derecognition

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

B. Capital Work In Progress

Cost of assets not ready for intended use, as on
balance sheet date is shown as capital work in
progress. Advances given towards acquisition
of property, plant and equipment outstanding at
each balance sheet date are disclosed as other
non-current assets.

C. Intangible Assets

Identifiable intangible assets are recognised when
the Company controls the asset, it is probable that
future economic benefits attributed to the asset
will flow to the Company and the cost of the asset
can be reliably measured. At initial recognition,
the separately acquired intangible assets are
recognised at cost. Following initial recognition,
the intangible assets are carried at cost less
any accumulated amortization and accumulated
impairment losses, if any. Subsequent expenditure
is capitalised only when it increases the future
economic benefits embodied in the specific asset
to which it relates.

The Company amortized intangible assets over
their estimated economic useful lives using the
written down value basis as per Companies
Act 2013. The management has estimated the

The estimated useful life and amortization method
reviewed at the end of each reporting period,
with the effect of any changes in estimate being
accounted for on a prospective basis.

D. Investment Property
Recognition and Measurement

Land and Building held to earn rental or for capital
appreciation or both, rather than for use in the
production or supply of goods or services or for
administrative purposes: or sale in the ordinary
course of business is recognised as investment
property. Land held for a currently undetermined
future use is also recognised as Investment
Property.

Investment property is measured initially at its
cost, including related transaction costs and
where applicable borrowing costs. Subsequent
expenditure is capitalised to the asset''s carrying
amount only when it is probable that future
economic benefits associated with the expenditure
will flow to the Company and the cost of the item
can be measured reliably. All other repairs and
maintenance costs are expensed when incurred.
When part of an investment property is replaced,
the carrying amount of the replaced part is
derecognised.

Gain or Loss on Disposal

Any gain or loss on disposal of an Investment
Property is recognised in the Statement of Profit
and loss.

E. Impairment

i. Impairment of financial Assets

The Company recognises loss allowances for
expected credit losses on:

- financial assets measured at amortised cost;

- contract assets recognised under contract
with customers; and

- financial assets measured at FOCI- debt
investments.

At each reporting date, the Company assesses
whether financial assets carried at amortised cost
are credit-impaired. A financial asset is ''credit-
impaired'' when one or more events that have a
detrimental impact on the estimated future cash
flows of the financial asset have occurred.

Evidence that a financial asset is credit-impaired
includes the following observable data:

- significant financial difficulty of the borrower
or issuer;

- a breach of contract such as a default or
being past due for 90 days or more;

- the restructuring of a loan or advance by
each entity in the Company on terms that
such entity would not consider otherwise;

- it is probable that the borrower will enter
bankruptcy or other financial reorganisation;

- the disappearance of an active market for a
security because of financial difficulties.

The Company measures loss allowances at an
amount equal to lifetime expected credit losses,
except for bank balances for which credit risk (i.e.
the risk of default occurring over the expected
life of the financial instrument) has not increased
significantly since initial recognition, which are
measured as 12 month expected credit losses.

Loss allowances for trade receivables are always
measured at an amount equal to lifetime expected
credit losses. Lifetime expected credit losses are
the expected credit losses that result from all
possible default events over the expected life of
a financial instrument. Twelve months expected
credit losses are the portion of expected credit
losses that result from default events that are
possible within 12 months after the reporting
date (or a shorter period if the expected life of the
instrument is less than 12 months).

In all cases, the maximum period considered when
estimating expected credit losses is the maximum
contractual period over which the Company is
exposed to credit risk. When determining whether
the credit risk of a financial asset has increased
significantly since initial recognition and when
estimating expected credit losses, the Company
considers reasonable and supportable information
that is relevant and available without undue cost
or effort. This includes both quantitative and

qualitative information and analysis, based on the
Companies historical experience and informed
credit assessment and including forward-looking
information.

ii. Impairment of non-financial assets

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

For impairment testing, assets that do not
generate independent cash inflows are grouped
together into cash-generating units (CGUs).
Each GU represents the smallest group of assets
that generates cash inflows that are largely
independent of the cash inflows of other assets or
CGUs.

The recoverable amount of a CGU (or an individual
asset) is the higher of its value in use and its fair
value less costs to sell. Value in use is based on
the estimated future cash flows, discounted to
their present value using a pre-tax discount rate
that reflects current market assessments of the
time value of money and the risks specific to the
GU (or the asset).

The Companies assets (e.g., central office building
for providing support to various CGUs) do not
generate independent cash inflows. To determine
impairment of a corporate asset, recoverable
amount is determined for the CGUs to which the
corporate asset belongs.

An impairment loss is recognised if the carrying
amount of an asset or GU exceeds its estimated
recoverable amount. Impairment losses are
recognised in the Statement of Profit and Loss.
Impairment loss recognised in respect of a CGU
is allocated first to reduce the carrying amount
of any goodwill allocated to the GU, and then to
reduce the carrying amounts of the other assets
of the CGU (or group of CGUs) on a pro rata basis.

In respect of other assets for which impairment
loss has been recognised in prior periods, the
Company reviews at each reporting date whether
there is any indication 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. Such a
reversal is made only to the extent that the asset''s
carrying amount does not exceed the carrying

amount that would have been determined, net of
depreciation or amortisation, if no impairment loss
had been recognised.

F. Inventories

Inventories include finished goods, raw materials
and Work in Progress. The inventory is valued at
cost or Net Realisable Value, whichever is lower.
Cost is ascertained on weighted average basis.

The cost of inventory include expenditure in
purchasing the materials, production and conversion
cost and other relevant costs incurred in bringing
them to their present location and condition.

Net realizable value is the estimated selling price
in the ordinary course of business, less estimated
costs of completion and estimated costs
necessary to make the sale.

G. Financial Instruments

i. Financial assets

Initial recognition and measurement

Financial assets are recognised when, and
only when, the Company becomes a party
to the contractual provisions of the financial
instrument. The Company determines the
classification of its financial assets at initial
recognition.

When financial assets are recognised initially,
they are measured at fair value. Transaction
costs that are directly attributable to the
acquisition or issue of financial assets, which
are not at fair value through profit or loss, are
adjusted to the fair value on initial recognition.

Classification:

a. Cash and Cash Equivalents

Cash comprises cash/cheques on
hand and demand deposits with
banks. Cash equivalents are short-term
balances (with an original maturity of
three months or less from the date of
acquisition), highly liquid investment
that are readily convertible into known
amounts of cash and which are subject
to insignificant risk of changes in value.

b. Debt Instruments

The Company classifies its debt
instruments, as subsequently measured
at amortised cost or fair value through
Other Comprehensive Income or fair

value through profit or loss based on
its business model for managing the
financial assets and the contractual
cash flow characteristics of the financial
asset

i. Financial assets at amortised cost

Financial assets are subsequently
measured at amortised cost if these
financial assets are held for collection
of contractual cash flows where those
cash flows represent solely payments of
principal and interest. Interest income
from these financial assets is included
as a part of the Company''s income in
the Statement of Profit and Loss using
the effective interest rate method.

ii. Financial assets at fair value through
Other Comprehensive Income
(FVOCI)

Financial assets are subsequently
measured at fair value through Other
Comprehensive Income if these
financial assets are held for collection
of contractual cash flows and for selling
the financial assets, where the assets
cash flows represent solely payments
of principal and interest. Movements
in the carrying value are taken through
Other Comprehensive Income, except
for the recognition of impairment gains
or losses, interest revenue and foreign
exchange gains or losses which are
recognised in the Statement of Profit
and Loss. When the financial asset is
derecognised, the cumulative gain or
loss previously recognised in Other
Comprehensive Income is reclassified
from Other Comprehensive Income to
the Statement of Profit and Loss.

iii. Financial assets at fair value through
profit or loss (FVTPL)

Assets that do not meet the criteria for
amortised cost or FVOCI are measured
at fair value through profit or loss. A gain
or loss on such debt instrument that is
subsequently measured at FVTPL and
is not part of a hedging relationship as
well as interest income is recognised in
the Statement of Profit and Loss.

Equity Instruments

The Company subsequently measures all

equity investment (other than the investments
in subsidiaries, joint ventures and associates
which are measured at cost) at fair value. Where
the Company has elected to present fair value
gains and losses on equity investments in Other
Comprehensive Income (“OCI”), there is no
subsequent reclassification of fair value of gains
and losses to profit or loss. Dividends from such
investments are recognised in the Statement
of Profit and Loss as other income when the
Company''s right to receive payment is established.

The Company has made an irrecoverable election
to present in Other Comprehensive Income
subsequent changes in the fair value of equity
investments that are not held for trading (except
investments in subsidiaries, joint ventures and
associates which are measured at cost).

When the equity investment is de-recognised, the
cumulative gain or loss previously recognised in
Other Comprehensive Income is reclassified from
Other Comprehensive Income to the Retained
Earnings directly.

De-recognition

A financial asset is de-recognised only when the
Company has transferred the rights to receive
cash flows from the financial asset. Where
the Company has transferred an asset, the
Company evaluates whether it has transferred
substantially all risks and rewards of ownership
of the financial asset. In such cases, the financial
asset is de-recognised. Where the Company has
not transferred substantially all risks and rewards
of ownership of the financial asset, the financial
asset is not de-recognised. Where the Company
retains control of the financial asset, the asset
is continued to be recognised to the extent of
continuing involvement in the financial asset.

ii. Financial liabilities

Initial recognition and measurement

Financial liabilities are recognised when and only
when, the Company becomes a party to the
contractual provisions of the financial instrument.
The Company determines the classification of its
financial liabilities at initial recognition.

All financial liabilities are recognised initially at
fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial
liabilities, which are not at fair value through profit
or loss, are adjusted to the fair value on initial
recognition.

Subsequent measurement

After initial recognition, financial liabilities that are
not carried at fair value through profit or loss are
subsequently measured at amortised cost using
the effective interest method. Gains and losses
are recognised in the Statement of Profit and Loss
when the liabilities are derecognised, and through
the amortisation process

De-recognition

A financial liability is de-recognised 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
a de-recognition of the original liability and the
recognition of a new liability, and the difference in
the respective carrying amounts is recognised in
the Statement of Profit and Loss.

Equity Instruments

An equity instrument is any contract that
evidences a residual interest in the assets of an
entity after deducting all of its liabilities. Equity
instruments issued by a Company are recognised
at the proceeds received.

H. Borrowing costs

General and specific borrowing costs that
are directly attributable to the acquisition,
construction or production of a qualifying asset
are capitalised during the period of time that is
required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets
that necessarily take a substantial period of time
to get ready for their intended use or sale.

Interest income earned on the temporary
investment of specific borrowings pending their
expenditure on qualifying assets is deducted from
the borrowing costs eligible for capitalisation.
Other borrowing costs are expensed in the period
in which they are incurred.

I. Cash and Cash Equivalent

Cash and cash equivalent includes cash on hand,
other short-term, highly liquid investments with
original maturities of three months or less that
are readily convertible to known amounts of cash
and which are subject to an insignificant risk of
changes in value, and bank overdrafts.

J. Statement of Cash Flows

Cash flows are reported using the indirect method,
whereby net profit before taxes for the period is
adjusted for the effects of transactions of a non¬
cash nature, any deferrals or accruals of past or
future operating cash receipts or payments and
item of income or expenses associated with
investing or financing cash flows. The cash flows
from operating, investing and financing activities
of the Company are segregated.

K. Earnings per share
Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the

company

- by the weighted average number of equity
shares outstanding during the financial year,
adjusted for bonus elements in equity shares
issued.

Diluted earnings per share

Diluted earnings per share adjusts the figures
used in the determination of basic earnings per
share to take into account:

- the profit attributable to owners of the

company

- the weighted average number of additional
equity shares that would have been
outstanding assuming the conversion of all
dilutive potential equity shares.

L. Revenue Recognition

Revenue from contracts with customer

Revenue from contracts with customers is
recognised when control of the goods or services
are transferred to the customer at an amount that
reflects the consideration to which the Company
expects to be entitled in exchange for those goods
or services. The Company assesses promises
in the contract that are separate performance
obligations to which a portion of transaction price
is allocated.

Revenue is measured based on the transaction
price as specified in the contract with the
customer. It excludes taxes or other amounts
collected from customers in its capacity as an
agent. In determining the transaction price, the
Company considers below, it any:

a. Variable consideration - This includes
bonus, incentives, discounts etc. It is
estimated at contract inception and
constrained until it is highly probable that a
significant revenue reversal in the amount
of cumulative revenue recognised will not
occur when the associated uncertainty with
the variable consideration is subsequently
resolved. It is reassessed at end of each
reporting period.

b. Significant financing component -

Generally, the Company receives short¬
term advances from its customers. Using
the practical expedient in Ind AS 115, the
Company does not adjust the promised
amount of consideration for the effects of a
significant financing component if it expects,
at contract inception, that the period
between the transfer of the promised good
or service to the customer and when the
customer pays for that good or service will
be one year or less.

c. Consideration payable to a customer -

Such amounts are accounted as reduction
of transaction price and therefore, of revenue
unless the payment to the customer is in
exchange for a distinct good or service that
the customer transfers to the Company.

In accordance with Ind AS 37, the Company
recognises a provision for onerous contract
when the unavoidable costs of meeting the
obligations under a contract exceed the
economic benefits to be received.

Contract modifications

Contract modifications are accounted for
when additions, deletions or changes are
approved either to the contract scope
or contract price. The accounting for
modifications of contracts involves assessing
whether the services added to the existing
contract are distinct and whether the pricing
is at the standalone selling price. Services
added that are not distinct are accounted
for on a cumulative catch up basis, while
those that are distinct are accounted for
prospectively, either as a separate contract,
if additional services are priced at the
standalone selling price, or as a termination
of existing contract and creation of a new
contract if not priced at the standalone
selling price.

Cost to fulfil the contract

The Company recognises asset from the cost
incurred to fulfil the contract such as set up
and mobilisation costs and amortises it over the
contract tenure on a systematic basis that is
consistent with the transfer to the customer of the
goods or services to which the asset relates.

Contract balances
Contract assets

A contract asset is the right to consideration in
exchange for goods or services transferred to the
customer. If the Company performs its obligations
by transferring goods or services to a customer
before the customer pays consideration or before
payment is due, a contract asset is recognised
for the earned consideration that is conditional.
The contract assets are transferred to receivables
when the rights become unconditional. This
usually occurs when the Company issues an
invoice to the Customer.

Trade receivables

A receivable represents the Companies right to
an amount of consideration that is unconditional
ie. only the passage of time is required before
payment of consideration is due.

Contract liabilities

A contract liability is the obligation to transfer
goods or services to a customer for which
the Company has received consideration (or
an amount of consideration is due) from the
customer. Contract liabilities are recognised as
revenue when the Company performs under the
contract.

The accounting policies for the specific revenue
streams of the Company are summarised below:

i. Sale of products

Revenue from the sale of products is
recognised at point in time when the control
of the goods is transferred to the customer
based on contractual terms i.e. either on
dispatch of goods or on delivery of the
products at the customer''s location.

ii. Construction contracts

Revenue, where the performance obligation
is satisfied over time is recognised in
proportion to the stage of completion of
the contract. The stage of completion is
assessed by reference to surveys of work

performed. Otherwise, contract revenue is
recognised as an expense in the statement
of Profit and Loss in accounting periods in
which work to which they relate is performed.
An expected loss on a contract is recognised
immediately in the Statement of Profit and
Loss.

The Company recognises revenue at an
amount for which it has right to consideration
(i.e. right to invoice) from customer that
corresponds directly with the value of the
performance completed to the date.

Contract revenue includes the initial amount
agreed in the contract plus any variations in
contract work and claims payments, to the
extent that it is probable that they will result
in revenue and can be measured reliably.
The Company recognises bonus/ incentive
revenue on early completion of the project
upon acceptance of the corresponding claim
by the Customer.

iii. Job work income

Job work income is recognized when
the services are rendered and there are
no uncertainties involved to its ultimate
realization.

iv. Interest income

Interest income, including income arising
from other financial instruments measured
at amortised cost, is recognised using the
effective interest rate method.

v. Dividend income

Revenue is recognised when the company''s
right to receive the payment is established,
when it is probable that the economic
benefits associated with the dividend will
flow to the entity and the amount of dividend
can be reliably measured. This is generally
when shareholders approve the dividend.

vi. Rental Income

Lease income from operating leases where
the Company is a lessor is recognized as
income on a straight-line basis over the
lease term unless the receipts are structured
to increase in line with expected general
inflation to compensate for the expected
inflationary cost increases. The respective
leased assets are included in the balance
sheet based on their nature.

vii. Revenue in respect of other income is
recognised when no significant uncertainty
as to its determination or realisation exists.

M. Leases

In accordance with IND AS 116, the Company
recognises a right of use asset and a lease liability
at the lease commencement date. The right of use
asset is initially measured at cost which comprise
the initial amount of lease liability adjusted for any
lease payments made before the commencement
date. The right of use asset is subsequently
depreciated using the straight-line method of the
balance lease term. In addition, the right of use
asset is periodically reduced by impairment loss,
if any and adjusted for certain remeasurements of
lease liability.

The lease liability is initially measured at the present
value of the lease payments that are not paid
at the commencement date, discounted using
the implicit rate in the lease or the incremental
borrowing rate, if that rate cannot be readily
available at the commencement date of the lease
for the estimated term of the obligation.

Lease payments included in the measurement of
the lease liability comprise the amounts expected
to be payable over the period of lease. The lease
liability is measured at amortised cost using
effective interest rate method. It is remeasured
when there is a change in future lease payments
arising from change in the index or rate.

The Company has applied the short-term lease
recognition exemption to its short-term leases
(i.e., those leases that have a lease term of 12
months or less from the commencement date and
do not contain a purchase option) and low-value
assets recognition exemption.

N. Joint Arrangements

Under Ind AS 111 Joint arrangements, investments
in joint arrangements are classified as either joint
operations or joint ventures. The classification
depends on the contractual rights and obligations
of each investor, rather than the legal structure
of the joint arrangement. The Company has joint
operations.

Joint Operations

The company recognises its direct right to the
assets, liabilities, revenues and expenses of joint
operations and its share of any jointly held or
incurred assets, liabilities, revenues and expenses.

These have been incorporated in the financial
statements under the appropriate headings. The
details of joint operations are set out in note 38.

O. Employee benefits

(i) During Employment benefits

Short term employee benefits

Short-term employee benefits are expensed
as the related service is provided. A liability
is recognised for the amount expected
to be paid if the Company has a present
legal or constructive obligation to pay this
amount as a result of past service provided
by the employee and the obligation can be
estimated reliably.

(ii) Post Employment benefits

(a) Defined contribution plans

A defined contribution plan is a post¬
employment benefit plan under which
a Company pays fixed contribution into
a separate entity and will have no legal
or constructive obligation to pay further
amounts.

Obligations for contributions to defined
contribution plans are expensed as
the related service is provided. Prepaid
contributions are recognised as an asset to
the extent that a cash refund or a reduction
in future payments is available.

(b) Defined benefit plans

The Company pays gratuity to the employees
who have has completed five years of
service with the Company at the time when
employee leaves the Company.

The gratuity liability amount is unfunded and
formed exclusively for gratuity payment to
the employees.

The liability in respect of gratuity and other
post-employment benefits is calculated
using the Projected Unit Credit Method
and spread over the periods during which
the benefit is expected to be derived from
employees'' services.

Re-measurement of defined benefit plans in
respect of post-employment are charged to

Other Comprehensive Income.

Compensated Absences: Accumulated
compensated absences, which are
expected to be availed or encashed within
12 months from the end of the year are
treated as short term employee benefits. The
obligation towards the same is measured
at the expected cost of accumulated
compensated absences as the additional
amount expected to be paid as a result of
the unused entitlement as at the year end.

(iii) Termination benefits

Termination benefits are payable when
employment is terminated by the Company
before the normal retirement date or when
an employee accepts voluntary redundancy
in exchange for these benefits. In case
of an offer made to encourage voluntary
redundancy, the termination benefits
are measured based on the number of
employees expected to accept the offer.

P. Taxes

i. Current income tax

Current income tax assets and liabilities
are measured at the amount expected to
be recovered from or paid to the taxation
authorities. The tax rates and tax laws used
to compute the amount are those that are
enacted or substantively enacted, at the
reporting date in the countries where the
company operates and generates taxable
income.

Current income tax relating to items
recognised outside profit or loss is recognised
outside profit or loss (either in other
comprehensive income or in equity). Current
tax items are recognised in correlation to the
underlying transaction either in OCI or directly
in equity. Management periodically evaluates
positions taken in the tax returns with
respect to situations in which applicable tax
regulations are subject to interpretation and
establishes provisions where appropriate.

ii. Deferred tax

Deferred income tax is recognised using
the balance sheet approach, deferred tax is
recognised on temporary differences at the
balance sheet date between the tax bases

of assets and liabilities and their carrying
amounts for financial reporting purposes,
except when the deferred income tax arises
from the initial recognition of goodwill or an
asset or liability in a transaction that is not
a business combination and affects neither
accounting nor taxable profit or loss at the
time of the transaction.

Deferred income tax assets are recognised
for all deductible temporary differences, carry
forward of unused tax credits and unused
tax losses, 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.

The carrying amount of deferred income tax
assets is reviewed at each balance sheet
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 income tax asset to be utilised.

Deferred income tax assets and liabilities are
measured at the tax rates that are expected
to apply in the period when the asset is
realized or the liability is settled, based on tax
rates (and tax laws) that have been enacted
or substantively enacted at the balance
sheet date.

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.

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Mar 31, 2024

1. Corporate Information

Vishnu Prakash R. Punglia Limited (VPRP) (CIN - L45203MH2013PLC243252) (hereinafter referred as “The Company”) was incepted in year 1986 having its registered office at Unit No. 3, 5Th Floor, B-Wing, Trade Star Premises Co-Operative Society Limited building At Village Kondivita, Mathuradas Vasanji Road, Near Chakala Metro Station, Andheri East Mumbai MH-400059, as a Construction & infrastructure Development partnership firm, later in April 2013 Converted as a limited company under Part IX of Indian Companies act 1956.

The company is registered with the Registrar of Companies, Mumbai (Maharashtra) India and engaged in the business of engineering, procurement and construction of infrastructure projects.

2. Basis of Preparation, Measurement and Material Accounting Policies

2.1 Basis of Preparation and Measurement

A. Financial Statement of Compliance

The financial statements of the Company comprise the Balance Sheet as at 31st March 2024, the statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and the Statement of Cash Flows for the year ended 31st March 2024, the summary of material accounting policies and explanatory notes (collectively, the ‘Financial Statements’).

These Financial Statements have been prepared by the management in accordance with applicable provision of the Companies Act 2013 and to comply in all material respects with the Indian Accounting Standards (“Ind AS”) as prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, (as amended from time to time), including presentation requirements of Division II of Schedule III to the Act, as applicable to the financial statements and other relevant provisions of the Act.

These Financial Statements were approved for issue by the Company’s Board of Directors on 27th May 2024.

B. Basis of Preparation:

The accounting policies set out below have been applied consistently to the periods presented in the Financial Statements. These

Financial Statements have been prepared on a going concern basis.

C. Basis of Measurement:

The Financial Statements have been prepared on a historical cost basis, except for certain financial assets and liabilities measured at fair value or amortised cost method (refer accounting policy regarding financial instruments) or revalued amount.

D. Current and Non-Current Classification

The Company presents assets and liabilities in the balance sheet based on current/ noncurrent 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 only.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The operating cycle of the Company''s operations varies from contract to contract depending on

the size of the contract and related approvals. Accordingly, contract related assets and liabilities are classified into current and noncurrent based on the operating cycle of the contract. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.

E. Functional and Presentation Currency

The Financial Statements has been presented in Indian Rupees (Rs. or INR). All amounts have been rounded-off to the nearest millions and decimals thereof, unless otherwise mentioned.

F. Use of estimates, assumptions and judgements

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires, management to make judgements, estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses for the years presented.

Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

Assumption and estimation uncertainties:

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the amounts recognised in the

Financial Statements is included in the following notes:

(i) Impairment test of non-financial assets and financials assets

(ii) Measurement of defined benefit obligations: key actuarial assumptions

(iii) Recognition of deferred tax assets: availability of future taxable profit against which tax losses carried forward can be used

(iv) Recognition and measurement of provisions

and contingencies: key assumptions

about the likelihood and magnitude of an outflow of resources

G. Fair value measurement

Certain accounting policies and disclosures of the Company require the measurement of fair values, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The valuation team regularly reviews significant unobservable inputs and valuation adjustments.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

2.2 Material accounting policies

A. Property, plant and equipment Recognition and Measurement

Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Freehold land is stated at cost.

The cost of an item of property, plant and equipment comprises:

a) its purchase price, including nonrefundable purchase taxes, after deducting trade discounts and rebates.

b) any costs 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.

c) the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment and depreciated accordingly.

Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

Transition to Ind AS

On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.

Depreciation methods, estimated useful lives and residual value

Depreciation is calculated on written down value basis using the useful lives as prescribed under Schedule II to the Companies Act, 2013. If the management’s estimate of the useful life of a property plant & equipment at the time of acquisition of the asset or of the remaining useful life on a subsequent review is shorter than that envisaged in the aforesaid schedule, depreciation is provided at a higher rate based on the management’s estimate of the useful life/remaining useful life.

Assets	Useful Life
Building & Property	60 years
Furniture & Fixtures	10 years
Plant & Equipment	5 - 15 years
Computer & Peripherals	3 years
Vehicles	8 - 10 years
Leasehold Land and	Over Lease Period
Improvements

obtain ownership at the end of the lease term. Leasehold land is amortised on a straight-line basis over the balance period of lease.

The residual values are not more than 5% of the original cost of the asset.

Derecognition

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

B. Capital Work In Progress

Cost of assets not ready for intended use, as on balance sheet date is shown as capital work in progress. Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as other non-current assets.

C. Intangible Assets

Identifiable intangible assets are recognised when the Company controls the asset, it is probable that future economic benefits attributed to the asset will flow to the Company and the cost of the asset can be reliably measured. At initial recognition, the separately acquired intangible assets are recognised at cost. Following initial recognition, the intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any. Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates.

The Company amortized intangible assets over their estimated economic useful lives using the written

down value basis as per Companies Act 2013. The

management has estimated the economic useful lives of intangible assets as follows:

Depreciation on additions during the year is provided on pro rata basis with reference to month of addition/installation.

The property, plant and equipment acquired under finance leases is depreciated over the asset’s useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the company will

Assets	Useful Life
Computer Software	5 years

The estimated useful life and amortization method reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.

D. Investment Property Recognition and Measurement

Land and Building held to earn rental or for capital appreciation or both, rather than for use in the production or supply of goods or services or for administrative purposes: or sale in the ordinary course of business is recognised as investment property. Land held for a currently undetermined future use is also recognised as Investment Property.

Investment property is measured initially at its cost, including related transaction costs and where applicable borrowing costs. Subsequent expenditure is capitalised to the asset’s carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Gain or Loss on Disposal

Any gain or loss on disposal of an Investment Property is recognised in the Statement of Profit and loss.

E. Impairment

i. Impairment of financial Assets

The Company recognises loss allowances for expected credit losses on:

- financial assets measured at amortised cost;

- contract assets recognised under contract with customers; and

- financial assets measured at FOCI-debt investments.

At each reporting date, the Company assesses whether financial assets carried at amortised cost are credit-impaired. A financial asset is ''credit-impaired'' when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit-impaired includes the following observable data:

- significant financial difficulty of the borrower or issuer;

- a breach of contract such as a default or being past due for 90 days or more;

- the restructuring of a loan or advance by each entity in the Company on terms that such entity would not consider otherwise;

- it is probable that the borrower will enter bankruptcy or other financial reorganisation;

- the disappearance of an active market for a security because of financial difficulties.

The Company measures loss allowances at an amount equal to lifetime expected credit losses, except for bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition, which are measured as 12 month expected credit losses.

Loss allowances for trade receivables are always measured at an amount equal to lifetime expected credit losses. Lifetime expected credit losses are the expected credit losses that result from all possible default events over the expected life of a financial instrument. Twelve months expected credit losses are the portion of expected credit losses that result from default events that are possible within 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

In all cases, the maximum period considered when estimating expected credit losses is the maximum contractual period over which the Company is exposed to credit risk. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Companies historical experience and

informed credit assessment and including forward-looking information.

ii. Impairment of non-financial assets

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

For impairment testing, assets that do not generate independent cash inflows are grouped together into cash-generating units (CGUs). Each GU represents the smallest group of assets that generates cash inflows that are largely independent of the cash inflows of other assets or CGUs.

The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the GU (or the asset).

The Companies assets (e.g., central office building for providing support to various CGUs) do not generate independent cash inflows. To determine impairment of a corporate asset, recoverable amount is determined for the CGUs to which the corporate asset belongs.

An impairment loss is recognised if the carrying amount of an asset or GU exceeds its estimated recoverable amount. Impairment losses are recognised in the Statement of Profit and Loss. Impairment loss recognised in respect of a CGU is allocated first to reduce the carrying amount of any goodwill allocated to the GU, and then to reduce the carrying amounts of the other assets of the CGU (or group of CGUs) on a pro rata basis.

In respect of other assets for which impairment loss has been recognised in prior periods, the Company reviews at each reporting date whether there is any indication 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. Such a reversal is made only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

F. Inventories

Inventories include finished goods, raw materials and Work in Progress. The inventory is valued at cost or Net Realisable Value, whichever is lower. Cost is ascertained on weighted average basis.

The cost of inventory include expenditure in purchasing the materials, production and conversion cost and other relevant costs incurred in bringing them to their present location and condition.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

G. Financial Instruments

i. Financial assets

Initial recognition and measurement

Financial assets are recognised when, and only when, the Company becomes a party to the contractual provisions of the financial instrument. The Company determines the classification of its financial assets at initial recognition.

When financial assets are recognised initially, they are measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition.

Classification:

a. Cash and Cash Equivalents

Cash comprises cash/cheques on hand and demand deposits with banks. Cash equivalents are shortterm balances (with an original maturity of three months or less from the date of acquisition), highly liquid investment that are readily convertible into known amounts of cash and

which are subject to insignificant risk of changes in value.

b. Debt Instruments

The Company classifies its debt instruments, as subsequently measured at amortised cost or fair value through Other Comprehensive Income or fair value through profit or loss based on its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset

i. Financial assets at amortised cost

Financial assets are subsequently measured at amortised cost if these financial assets are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest. Interest income from these financial assets is included as a part of the Company’s income in the Statement of Profit and Loss using the effective interest rate method.

ii. Financial assets at fair value through Other Comprehensive Income (FVOCI)

Financial assets are subsequently measured at fair value through Other Comprehensive Income if these financial assets are held for collection of contractual cash flows and for selling the financial assets, where the assets cash flows represent solely payments of principal and interest. Movements in the carrying value are taken through Other Comprehensive Income, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains or losses which are recognised in the Statement of Profit and Loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in Other Comprehensive Income is reclassified from Other Comprehensive Income to the Statement of Profit and Loss.

iii. Financial assets at fair value through profit or loss (FVTPL)

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on such debt instrument that is subsequently measured at FVTPL and is not part of a hedging relationship as well as interest income is recognised in the Statement of Profit and Loss.

c. Equity Instruments

The Company subsequently measures all equity investment (other than the investments in subsidiaries, joint ventures and associates which are measured at cost) at fair value. Where the Company has elected to present fair value gains and losses on equity investments in Other Comprehensive Income (“OCI”), there is no subsequent reclassification of fair value of gains and losses to profit or loss. Dividends from such investments are recognised in the Statement of Profit and Loss as other income when the Company’s right to receive payment is established.

The Company has made an irrecoverable election to present in Other Comprehensive Income subsequent changes in the fair value of equity investments that are not held for trading (except investments in subsidiaries, joint ventures and associates which are measured at cost).

When the equity investment is derecognised, the cumulative gain or loss previously recognised in Other Comprehensive Income is reclassified from Other Comprehensive Income to the Retained Earnings directly.

De-recognition

A financial asset is de-recognised only when the Company has transferred the rights to receive cash flows from the financial asset. Where the Company has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards

of ownership of the financial asset. In such cases, the financial asset is de-recognised. Where the Company has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not de-recognised. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

ii. Financial liabilities

Initial recognition and measurement

Financial liabilities are recognised when and only when, the Company becomes a party to the contractual provisions of the financial instrument. The Company determines the classification of its financial liabilities at initial recognition.

All financial liabilities are recognised initially at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial liabilities, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition.

Subsequent measurement

After initial recognition, financial liabilities that are not carried at fair value through profit or loss are subsequently measured at amortised cost using the effective interest method. Gains and losses are recognised in the Statement of Profit and Loss when the liabilities are derecognised, and through the amortisation process

De-recognition

A financial liability is de-recognised 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 a de-recognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by a Company are recognised at the proceeds received.

H. Borrowing costs

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. Other borrowing costs are expensed in the period in which they are incurred.

I. Cash and Cash Equivalent

Cash and cash equivalent includes cash on hand, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts.

J. Statement of Cash Flows

Cash flows are reported using the indirect method, whereby net profit before taxes for the period is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company are segregated.

K. Earnings per share Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the company

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued.

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

- the profit attributable to owners of the company

- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

L. Revenue Recognition

Revenue from contracts with customer

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company assesses promises in the contract that are separate performance obligations to which a portion of transaction price is allocated.

Revenue is measured based on the transaction price as specified in the contract with the customer. It excludes taxes or other amounts collected from customers in its capacity as an agent. In determining the transaction price, the Company considers below, it any:

a. Variable consideration -This includes bonus, incentives, discounts etc. It is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. It is reassessed at end of each reporting period.

b. Significant financing component - Generally, the Company receives short-term advances from its customers. Using the practical expedient in Ind AS 115, the Company does not adjust the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the transfer of the promised good or service to the customer and when the customer pays for that good or service will be one year or less.

c. Consideration payable to a customer - Such amounts are accounted as reduction of transaction price and therefore, of revenue unless the payment to the customer is in

exchange for a distinct good or service that the customer transfers to the Company.

In accordance with Ind AS 37, the Company recognises a provision for onerous contract when the unavoidable costs of meeting the obligations under a contract exceed the economic benefits to be received.

Contract modifications

Contract modifications are accounted for when additions, deletions or changes are approved either to the contract scope or contract price. The accounting for modifications of contracts involves assessing whether the services added to the existing contract are distinct and whether the pricing is at the standalone selling price. Services added that are not distinct are accounted for on a cumulative catch up basis, while those that are distinct are accounted for prospectively, either as a separate contract, if additional services are priced at the standalone selling price, or as a termination of existing contract and creation of a new contract if not priced at the standalone selling price.

Cost to fulfil the contract

The Company recognises asset from the cost incurred to fulfil the contract such as set up and mobilisation costs and amortises it over the contract tenure on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates.

Contract balances

Contract assets

A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs its obligations by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional. The contract assets are transferred to receivables when the rights become unconditional. This usually occurs when the Company issues an invoice to the Customer.

Trade receivables

A receivable represents the Companies right to an amount of consideration that is unconditional ie. only the passage of time is required before payment of consideration is due.

Contract liabilities

A contract liability is the obligation to transfer goods or services to a customer for which

the Company has received consideration (or an amount of consideration is due) from the customer. Contract liabilities are recognised as revenue when the Company performs under the contract.

The accounting policies for the specific revenue streams of the Company are summarised below:

i. Sale of products

Revenue from the sale of products is recognised at point in time when the control of the goods is transferred to the customer based on contractual terms i.e. either on dispatch of goods or on delivery of the products at the customer''s location.

ii. Construction contracts

Revenue, where the performance obligation is satisfied over time is recognised in proportion to the stage of completion of the contract. The stage of completion is assessed by reference to surveys of work performed. Otherwise, contract revenue is recognised as an expense in the statement of Profit and Loss in accounting periods in which work to which they relate is performed. An expected loss on a contract is recognised immediately in the Statement of Profit and Loss.

The Company recognises revenue at an amount for which it has right to consideration (i.e. right to invoice) from customer that corresponds directly with the value of the performance completed to the date.

Contract revenue includes the initial amount agreed in the contract plus any variations in contract work and claims payments, to the extent that it is probable that they will result in revenue and can be measured reliably. The Company recognises bonus/ incentive revenue on early completion of the project upon acceptance of the corresponding claim by the Customer.

iii. Job work income

Job work income is recognized when the services are rendered and there are no uncertainties involved to its ultimate realization.

iv. Interest income

Interest income, including income arising from other financial instruments measured at amortised cost, is recognised using the effective interest rate method.

v. Dividend income

Revenue is recognised when the company’s right to receive the payment is established, when it is probable that the economic benefits associated with the dividend will flow to the entity and the amount of dividend can be reliably measured. This is generally when shareholders approve the dividend.

vi. Rental Income

Lease income from operating leases where the Company is a lessor is recognized as income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases. The respective leased assets are included in the balance sheet based on their nature.

vii Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

M. Leases

In accordance with IND AS 116, the Company recognises a right of use asset and a lease liability at the lease commencement date. The right of use asset is initially measured at cost which comprise the initial amount of lease liability adjusted for any lease payments made before the commencement date. The right of use asset is subsequently depreciated using the straight-line method of the balance lease term. In addition, the right of use asset is periodically reduced by impairment loss, if any and adjusted for certain remeasurements of lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the implicit rate in the lease or the incremental borrowing rate, if that rate cannot be readily available at the commencement date of the lease for the estimated term of the obligation.

Lease payments included in the measurement of the lease liability comprise the amounts expected to be payable over the period of lease. The lease liability is measured at amortised cost using effective interest rate method. It is remeasured when there is a change in future lease payments arising from change in the index or rate.

The Company has applied the short-term lease recognition exemption to its short-term leases

(i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option) and low-value assets recognition exemption.

N. Joint Arrangements

Under Ind AS 111 Joint arrangements, investments in joint arrangements are classified as either joint operations or joint ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Company has joint operations.

Joint Operations

The company recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the financial statements under the appropriate headings. The details of joint operations are set out in note 38.

O. Employee benefits

(i) During Employment benefits

Short term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(ii) Post Employment benefits

(a) Defined contribution plans

A defined contribution plan is a postemployment benefit plan under which a Company pays fixed contribution into a separate entity and will have no legal or constructive obligation to pay further amounts.

Obligations for contributions to defined contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

(b) Defined benefit plans

The Company pays gratuity to the employees who have has completed five years of service with the

Company at the time when employee leaves the Company.

The gratuity liability amount is unfunded and formed exclusively for gratuity payment to the employees.

The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the periods during which the benefit is expected to be derived from employees'' services.

Re-measurement of defined

benefit plans in respect of postemployment are charged to Other Comprehensive Income.

Compensated Absences: Accumulated compensated absences, which are expected to be availed or encashed within 12 months from the end of the year are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulated compensated absences as the additional amount expected to be paid as a result of the unused entitlement as at the year end.

(iii) Termination benefits

Termination benefits are payable when employment is terminated by the Company before the normal retirement date or when an employee accepts voluntary redundancy in exchange for these benefits. In case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer.

O. Taxes

i. Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the company operates and generates taxable income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other

comprehensive income or in equity). Current tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

ii. Deferred tax

Deferred income tax is recognised using the balance sheet approach, deferred tax is recognised on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.

Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, 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.

The carrying amount of deferred income tax assets is reviewed at each balance sheet 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 income tax asset to be utilised.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.

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.

P. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources, that can be reliably estimated, will be required to settle such an obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Unwinding of the discount is recognised in the Statement of Profit and Loss as a finance cost. Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.

A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, is disclosed as a contingent liability. Contingent liabilities are also disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non -occurrence of one or more uncertain future events not wholly within the control of the Company.

Claims against the Company where the possibility of any outflow of resources in settlement is remote, are not disclosed as contingent liabilities.

Contingent assets are not recognised in financial statements since this may result in the recognition of income that may never be realised. However, when the realisation of income is virtually certain, then the related asset is not a contingent asset and is recognised.

Q. Operating Segment

The company is exclusively engaged in the business of construction and infrastructure development in India. Based on the management approach, the Chief Operating Decision Maker evaluates the company’s performance and allocates the resources based on an analysis of overall performance indicators. The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial Statements of the Company.

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Mar 31, 2023

1.    Corporate Information

Vishnu Prakash R. Punglia Limited (VPRP) ( CIN - U45203MH2013PLC243252) (hereinafter referred as “The Company”) was incepted in year 1986 having its registered office at Unit No. 3, 5Th Floor, B-Wing, Trade Star Premises Co-Operative Society Limited building At Village Kondivita, Mathuradas Vasanji Road, Near Chakala Metro Station, Andheri East Mumbai MH-400059, as a Construction & infrastructure Development partnership firm, later in April 2013 Converted as a limited company under Part IX of Indian Companies act 1956.

The company is registered with the Registrar of Companies, Mumbai (Maharashtra) India and engaged in the business of engineering, procurement and construction of infrastructure projects.

2.    Basis of Preparation, Measurement and Significant Accounting Policies 2.1 Basis of Preparation and Measurement

A.    Financial Statement of Compliance

The financial statements of the Company comprise the Balance Sheet as at 31^st March 2023, the statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and the Statement of Cash Flows for the year ended 31^st March 2023, the summary of significant accounting policies and explanatory notes (collectively, the 'Financial Statements').

These Financial Statements have been prepared by the management in accordance with applicable provision of the Companies Act 2013 and to comply in all material respects with the Indian Accounting Standards (“Ind AS”) as prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time), presentation requirements of Division II of Schedule III to the Act, as applicable to the financial statements and other relevant provisions of the Act.

Pursuant to the Companies (Indian Accounting Standard) Second Amendment Rules, 2015, the Company has prepare its first set of statutory financial statements as per Indian Accounting Standards (Ind-AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time) for the year ended 31^st March 2023 and consequently 1^st April 2021 is the transition date for preparation of such statutory financial statements. Up to the financial year ended 31^st March 2022, the Company prepared its financial statements in accordance with accounting standards prescribed under Section 133 of the Companies Act, 2013 (“Indian GAAP”).

In accordance with Ind AS 101 First-time Adoption of Indian Accounting Standards, the Company has presented an explanation of how the transition to Ind AS has affected the previously reported financial position, financial performance and cash flows (Refer to Note 42).

These Financial Statements were approved for issue by the Company's Board of Directors on June 2023.

B.    Basis of Preparation:

The accounting policies set out below have been applied consistently to the periods presented in the Financial Statements. These Financial Statements have been prepared on a going concern basis.

C.    Basis of Measurement:

The Financial Statements have been prepared on a historical cost basis, except for certain financial assets and liabilities measured at fair value or amortised cost method (refer accounting policy regarding financial instruments) or revalued amount.

D.    Current and 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 only.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The operating cycle of the Company's operations varies from contract to contract depending on the size of the contract and related approvals. Accordingly, contract related assets and liabilities are classified into current and non-current based on the operating cycle of the contract. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.

E.    Functional and Presentation Currency

The Financial Statements has been presented in Indian Rupees (Rs. or INR). All amounts have been rounded-off to the nearest millions and decimals thereof, unless otherwise mentioned.

F.    Use of estimates, assumptions and judgements

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires, management to make judgements, estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses for the years presented.

Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

Assumption and estimation uncertainties:

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the amounts recognised in the

Financial Statements is included in the following notes:

(i)    Impairment test of non-financial assets and financials assets

(ii)    Measurement of defined benefit obligations: key actuarial assumptions

(iii)    Recognition of deferred tax assets: availability of future taxable profit against which tax losses carried forward can be used

(iv) Recognition and measurement of provisions and contingencies: key assumptions about the likelihood and magnitude of an outflow of resources

G. Fair value measurement

Certain accounting policies and disclosures of the Company require the measurement of fair values, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The valuation team regularly reviews significant unobservable inputs and valuation adjustments.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

-    Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

-    Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

-    Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

2.2 Significant accounting policies

A. Property, plant and equipment Recognition and Measurement

Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Freehold land is stated at cost.

The cost of an item of property, plant and equipment comprises:

a)    its purchase price, including non-refundable purchase taxes, after deducting trade discounts and rebates.

b)    any costs 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.

c)    the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment and depreciated accordingly.

Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

Transition to Ind AS

On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.

Depreciation methods, estimated useful lives and residual value

Depreciation is calculated on written down value basis using the useful lives as prescribed under Schedule II to the Companies Act, 2013. If the management's estimate of the useful life of a property plant & equipment at the time of acquisition of the asset or of the remaining useful life on a subsequent review is shorter than that envisaged in the aforesaid schedule, depreciation is provided at a higher rate based on the management's estimate of the useful life/remaining useful life.

Assets	Useful Life
Building & Property	60 years
Furniture & Fixtures	10 years
Plant & Equipment	5 - 15 years
Computer & Peripherals	3 years
Vehicles	8 - 10 years
Leasehold Land and Improvements	Over Lease Period

Depreciation on additions during the year is provided on pro rata basis with reference to month of addition/installation.

The property, plant and equipment acquired under finance leases is depreciated over the asset's useful life or over the shorter of the asset's useful life and the lease term if there is no reasonable certainty that the company will obtain ownership at the end of the lease term. Leasehold land is amortised on a straight-line basis over the balance period of lease.

The residual values are not more than 5% of the original cost of the asset.

Derecognition

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

B.    Capital Work In Progress

Cost of assets not ready for intended use, as on balance sheet date is shown as capital work in progress. Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as other non-current assets.

C.    Investment Property Recognition and Measurement

Land and Building held to earn rental or for capital appreciation or both, rather than for use in the production or supply of goods or services or for administrative purposes: or sale in the ordinary course of business is recognised as investment property. Land held for a currently undetermined future use is also recognised as Investment Property.

Investment property is measured initially at its cost, including related transaction costs and where applicable borrowing costs. Subsequent expenditure is capitalised to the asset's carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Gain or Loss on Disposal

Any gain or loss on disposal of an Investment Property is recognised in the Statement of Profit and loss.

D. Impairment

i.    Impairment of financial Assets

The Company recognises loss allowances for expected credit losses on:

-    financial assets measured at amortised cost;

-    contract assets recognised under contract with customers; and

-    financial assets measured at FOCI- debt investments.

At each reporting date, the Company assesses whether financial assets carried at amortised cost are credit-impaired. A financial asset is 'credit-impaired' when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit-impaired includes the following observable data:

-    significant financial difficulty of the borrower or issuer;

-    a breach of contract such as a default or being past due for 90 days or more;

-    the restructuring of a loan or advance by each entity in the Company on terms that such entity would not consider otherwise;

-    it is probable that the borrower will enter bankruptcy or other financial reorganisation;

-    the disappearance of an active market for a security because of financial difficulties.

The Company measures loss allowances at an amount equal to lifetime expected credit losses, except for bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition, which are measured as 12 month expected credit losses.

Loss allowances for trade receivables are always measured at an amount equal to lifetime expected credit losses. Lifetime expected credit losses are the expected credit losses that result from all possible default events over the expected life of a financial instrument. Twelve months expected credit losses are the portion of expected credit losses that result from default events that are possible within 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

In all cases, the maximum period considered when estimating expected credit losses is the maximum contractual period over which the Company is exposed to credit risk. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Companies historical experience and informed credit assessment and including forward-looking information.

ii.    Impairment of non-financial assets

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

For impairment testing, assets that do not generate independent cash inflows are grouped together into cashgenerating units (CGUs). Each GU represents the smallest group of assets that generates cash inflows that are largely independent of the cash inflows of other assets or CGUs.

The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the GU (or the asset).

The Companies assets (e.g., central office building for providing support to various CGUs) do not generate independent cash inflows. To determine impairment of a corporate asset, recoverable amount is determined for the CGUs to which the corporate asset belongs.

An impairment loss is recognised if the carrying amount of an asset or GU exceeds its estimated recoverable amount. Impairment losses are recognised in the Statement of Profit and Loss. Impairment loss recognised in respect of a CGU is allocated first to reduce the carrying amount of any goodwill allocated to the GU, and then to reduce the carrying amounts of the other assets of the CGU (or group of CGUs) on a pro rata basis.

In respect of other assets for which impairment loss has been recognised in prior periods, the Company reviews at each reporting date whether there is any indication 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. Such a reversal is made only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

E.    Inventories

Inventories include finished goods, raw materials and Work in Progress. The inventory is valued at cost or Net Realisable Value, whichever is lower. Cost is ascertained on weighted average basis.

The cost of inventory include expenditure in purchasing the materials, production and conversion cost and other relevant costs incurred in bringing them to their present location and condition.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

F.    Financial Instruments

i. Financial assets

Initial recognition and measurement

Financial assets are recognised when, and only when, the Company becomes a party to the contractual provisions of the financial instrument. The Company determines the classification of its financial assets at initial recognition.

When financial assets are recognised initially, they are measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition.

Classification:

a.    Cash and Cash Equivalents

Cash comprises cash/cheques on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investment that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

b.    Debt Instruments

The Company classifies its debt instruments, as subsequently measured at amortised cost or fair value through Other Comprehensive Income or fair value through profit or loss based on its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset

i. Financial assets at amortised cost

Financial assets are subsequently measured at amortised cost if these financial assets are held for collection of contractual cash flows where those cash flows represent solely payments of principal

and interest. Interest income from these financial assets is included as a part of the Company's income in the Statement of Profit and Loss using the effective interest rate method.

ii.    Financial assets at fair value through Other Comprehensive Income (FVOCI)

Financial assets are subsequently measured at fair value through Other Comprehensive Income if these financial assets are held for collection of contractual cash flows and for selling the financial assets, where the assets cash flows represent solely payments of principal and interest. Movements in the carrying value are taken through Other Comprehensive Income, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains or losses which are recognised in the Statement of Profit and Loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in Other Comprehensive Income is reclassified from Other Comprehensive Income to the Statement of Profit and Loss.

iii.    Financial assets at fair value through profit or loss (FVTPL)

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on such debt instrument that is subsequently measured at FVTPL and is not part of a hedging relationship as well as interest income is recognised in the Statement of Profit and Loss.

c. Equity Instruments

The Company subsequently measures all equity investment (other than the investments in subsidiaries, joint ventures and associates which are measured at cost) at fair value. Where the Company has elected to present fair value gains and losses on equity investments in Other Comprehensive Income (“OCI”), there is no subsequent reclassification of fair value of gains and losses to profit or loss. Dividends from such investments are recognised in the Statement of Profit and Loss as other income when the Company's right to receive payment is established.

The Company has made an irrecoverable election to present in Other Comprehensive Income subsequent changes in the fair value of equity investments that are not held for trading (except investments in subsidiaries, joint ventures and associates which are measured at cost).

When the equity investment is de-recognised, the cumulative gain or loss previously recognised in Other Comprehensive Income is reclassified from Other Comprehensive Income to the Retained Earnings directly.

De-recognition

A financial asset is de-recognised only when the Company has transferred the rights to receive cash flows from the financial asset. Where the Company has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is de-recognised. Where the Company has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not de-recognised. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

ii. Financial liabilities

Initial recognition and measurement

Financial liabilities are recognised when and only when, the Company becomes a party to the contractual provisions of the financial instrument. The Company determines the classification of its financial liabilities at initial recognition.

All financial liabilities are recognised initially at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial liabilities, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition.

Subsequent measurement

After initial recognition, financial liabilities that are not carried at fair value through profit or loss are subsequently measured at amortised cost using the effective interest method. Gains and losses are recognised in the Statement of Profit and Loss when the liabilities are derecognised, and through the amortisation process

De-recognition

A financial liability is de-recognised 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 a de-recognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by a Company are recognised at the proceeds received.

G.    Borrowing costs

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. Other borrowing costs are expensed in the period in which they are incurred.

H.    Cash and Cash Equivalent

Cash and cash equivalent includes cash on hand, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts.

I.    Statement of Cash Flows

Cash flows are reported using the indirect method, whereby net profit before taxes for the period is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company are segregated.

J.    Earnings per share Basic earnings per share

Basic earnings per share is calculated by dividing:

-    the profit attributable to owners of the company

-    by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued.

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

-    the profit attributable to owners of the company

-    the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

K. Revenue Recognition

Revenue from contracts with customer

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company assesses promises in the contract that are separate performance obligations to which a portion of transaction price is allocated.

Revenue is measured based on the transaction price as specified in the contract with the customer. It excludes taxes or other amounts collected from customers in its capacity as an agent. In determining the transaction price, the Company considers below, it any:

a.    Variable consideration - This includes bonus, incentives, discounts etc. It is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. It is reassessed at end of each reporting period.

b.    Significant financing component - Generally, the Company receives short-term advances from its customers. Using the practical expedient in Ind AS 115, the Company does not adjust the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the transfer of the promised good or service to the customer and when the customer pays for that good or service will be one year or less.

c.    Consideration payable to a customer - Such amounts are accounted as reduction of transaction price and therefore, of revenue unless the payment to the customer is in exchange for a distinct good or service that the customer transfers to the Company.

In accordance with Ind AS 37, the Company recognises a provision for onerous contract when the unavoidable costs of meeting the obligations under a contract exceed the economic benefits to be received.

Contract modifications

Contract modifications are accounted for when additions, deletions or changes are approved either to the contract scope or contract price. The accounting for modifications of contracts involves assessing whether the services added to the existing contract are distinct and whether the pricing is at the standalone selling price. Services added that are not distinct are accounted for on a cumulative catch up basis, while those that are distinct are accounted for prospectively, either as a separate contract, if additional services are priced at the standalone selling price, or as a termination of existing contract and creation of a new contract if not priced at the standalone selling price.

Cost to fulfil the contract

The Company recognises asset from the cost incurred to fulfil the contract such as set up and mobilisation costs and amortises it over the contract tenure on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates.

Contract balances Contract assets

A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs its obligations by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional. The contract assets are transferred to receivables when the rights become unconditional. This usually occurs when the Company issues an invoice to the Customer.

Trade receivables

A receivable represents the Companies right to an amount of consideration that is unconditional ie. only the passage of time is required before payment of consideration is due.

Contract liabilities

A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. Contract liabilities are recognised as revenue when the Company performs under the contract.

The accounting policies for the specific revenue streams of the Company are summarised below:

i.    Sale of products

Revenue from the sale of products is recognised at point in time when the control of the goods is transferred to the customer based on contractual terms i.e. either on dispatch of goods or on delivery of the products at the customer's location.

ii.    Construction contracts

Revenue, where the performance obligation is satisfied over time is recognised in proportion to the stage of completion of the contract. The stage of completion is assessed by reference to surveys of work performed. Otherwise, contract revenue is recognised as an expense in the statement of Profit and Loss in accounting periods in which work to which they relate is performed. An expected loss on a contract is recognised immediately in the Statement of Profit and Loss.

The Company recognises revenue at an amount for which it has right to consideration (i.e. right to invoice) from customer that corresponds directly with the value of the performance completed to the date.

Contract revenue includes the initial amount agreed in the contract plus any variations in contract work and claims payments, to the extent that it is probable that they will result in revenue and can be measured reliably. The Company recognises bonus/ incentive revenue on early completion of the project upon acceptance of the corresponding claim by the Customer.

iii.    Job work income

Job work income is recognized when the services are rendered and there are no uncertainties involved to its ultimate realization.

iv.    Interest income

Interest income, including income arising from other financial instruments measured at amortised cost, is recognised using the effective interest rate method.

v.    Dividend income

Revenue is recognised when the company's right to receive the payment is established, when it is probable that the economic benefits associated with the dividend will flow to the entity and the amount of dividend can be reliably measured. This is generally when shareholders approve the dividend.

vi.    Rental Income

Lease income from operating leases where the Company is a lessor is recognized as income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation

to compensate for the expected inflationary cost increases. The respective leased assets are included in the balance sheet based on their nature.

vii. Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

L.    Leases

In accordance with IND AS 116, the Company recognises a right of use asset and a lease liability at the lease commencement date. The right of use asset is initially measured at cost which comprise the initial amount of lease liability adjusted for any lease payments made before the commencement date. The right of use asset is subsequently depreciated using the straight-line method of the balance lease term. In addition, the right of use asset is periodically reduced by impairment loss, if any and adjusted for certain remeasurements of lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the implicit rate in the lease or the incremental borrowing rate, if that rate cannot be readily available at the commencement date of the lease for the estimated term of the obligation.

Lease payments included in the measurement of the lease liability comprise the amounts expected to be payable over the period of lease. The lease liability is measured at amortised cost using effective interest rate method. It is remeasured when there is a change in future lease payments arising from change in the index or rate.

The Company has applied the short-term lease recognition exemption to its short-term leases (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option) and low-value assets recognition exemption.

M.    Joint Arrangements

Under Ind AS 111 Joint arrangements, investments in joint arrangements are classified as either joint operations or joint ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Company has joint operations.

Joint Operations

The company recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the financial statements under the appropriate headings. The details of joint operations are set out in note 38.

N.    Employee benefits

(i)    During Employment benefits Short term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(ii)    Post Employment benefits

(a) Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which a Company pays fixed contribution into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

(b) Defined benefit plans

The Company pays gratuity to the employees who have has completed five years of service with the Company at the time when employee leaves the Company.

The gratuity liability amount is unfunded and formed exclusively for gratuity payment to the employees.

The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the periods during which the benefit is expected to be derived from employees' services.

Re-measurement of defined benefit plans in respect of post-employment are charged to Other Comprehensive Income.

Compensated Absences: Accumulated compensated absences, which are expected to be availed or encashed within 12 months from the end of the year are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulated compensated absences as the additional amount expected to be paid as a result of the unused entitlement as at the year end.

(iii) T ermination benefits

Termination benefits are payable when employment is terminated by the Company before the normal retirement date or when an employee accepts voluntary redundancy in exchange for these benefits. In case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer.

0.    Taxes

1.    Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the company operates and generates taxable income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

ii. Deferred tax

Deferred income tax is recognised using the balance sheet approach, deferred tax is recognised on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.

Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, 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.

The carrying amount of deferred income tax assets is reviewed at each balance sheet 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 income tax asset to be utilised.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.

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.

P.    Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources, that can be reliably estimated, will be required to settle such an obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Unwinding of the discount is recognised in the Statement of Profit and Loss as a finance cost. Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.

A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, is disclosed as a contingent liability. Contingent liabilities are also disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non -occurrence of one or more uncertain future events not wholly within the control of the Company.

Claims against the Company where the possibility of any outflow of resources in settlement is remote, are not disclosed as contingent liabilities.

Contingent assets are not recognised in financial statements since this may result in the recognition of income that may never be realised. However, when the realisation of income is virtually certain, then the related asset is not a contingent asset and is recognised.

Q.    Operating Segment

The company is exclusively engaged in the business of construction and infrastructure development in India. Based on the management approach, the Chief Operating Decision Maker evaluates the company's performance and allocates the resources based on an analysis of overall performance indicators. The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial Statements of the Company.

3. Recent Pronouncement

Ministry of Corporate Affairs (“MCA”) notified new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On 31 March 2023, MCA amended the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from 1st April 2023, as below:

Ind AS 1 - Presentation of Financial Statements

The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their 'significant' accounting policies with a requirement to disclose their 'material' accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.

The amendments to Ind AS 1 are applicable for annual periods beginning on or after 1^st April 2023. Consequential amendments have been made in Ind AS 107.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors

The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. It has also been clarified how entities use measurement techniques and inputs to develop accounting estimates. The amendments are effective for annual reporting periods beginning on or after 1st April 2023 and apply to changes in accounting policies and changes in accounting estimates that occur on or after the start of that period.

The Company is currently assessing the impact of the amendments.

Ind AS 12 - Income Taxes

The amendments narrow the scope of the initial recognition exception under Ind AS 12, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences. The amendments should be applied to transactions that occur on or after the beginning of the earliest comparative period presented. In addition, at the beginning of the earliest comparative period presented, a deferred tax asset (provided that sufficient taxable profit is available) and a deferred tax liability should also be recognised for all deductible and taxable temporary differences associated with leases and decommissioning obligations. Consequential amendments have been made in Ind AS 101. The amendments to Ind AS 12 are applicable for annual periods beginning on or after 1^st April 2023.

The Company is currently assessing the impact of the amendments.