26.2.10 Provisions
Provisions are recognized when the company has
a present obligation (legal or constructive) as a
result of a past event, it is probable that an outflow
of economic benefits will be required to settle the
obligation and a reliable estimate can be made of the
amount of the obligation.
26.2.11 Contingent Liabilities / Assets
Contingent Liabilities
Contingent liabilities are not recognized but disclosed
in Notes to the Accounts when the company has
possible obligation due to past events and existence
of the obligation depends upon occurrence or non¬
occurrence of future events not wholly within the
control of the company.
Contingent liabilities are assessed continuously to
determine whether outflow of economic resources
have become probable. If the outflow becomes
probable then relative provision is recognized in the
financial statements.
Where an entity is jointly and severally liable for an
obligation, the part of the obligation that is expected
to be met by other parties is treated as a contingent
liability. The entity recognises a provision for the part
of the obligation for which an outflow of resources
embodying economic benefits is probable, except in
the extremely rare circumstances where no reliable
estimate can be made. Contingent Liabilities are
disclosed in the General Notes forming part of the
accounts.
Contingent Assets
Contingent Assets are not recognised in the financial
statements. Such contingent assets are assessed
continuously and are disclosed in Notes when the
inflow of economic benefits becomes probable. If
it’s virtually certain that inflow of economic benefits
will arise then such assets and the relative income
will be recognised in the financial statements.
26.2.12 Taxation
Income tax expense represents the sum of the tax
currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit
for the year. Taxable profit differs from ‘profit before
tax’ as reported in the statement of profit or loss and
other comprehensive income/statement of profit or
loss because of items of income or expense that
are taxable or deductible in other years and items
that are never taxable or deductible. The Company’s
current tax is calculated using tax rates that have
been enacted or substantively enacted by the end
of the reporting period.
Deferred tax
Deferred tax is recognized on temporary differences
between the carrying amounts of assets and liabilities
in the financial statements and the corresponding
tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognized
for all taxable temporary differences. Deferred tax
assets are generally recognized for all deductible
temporary differences to the extent that it is
probable that taxable profits will be available against
which those deductible temporary differences can
be utilized.
Such deferred tax assets and liabilities are not
recognized if the temporary difference arises from
the initial recognition (other than in a business
combination) of assets and liabilities in a transaction
that affects neither the taxable profit nor the
accounting profit.
The carrying amount of deferred tax assets is
reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable
that sufficient taxable profits will be available to
allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at
the tax rates that are expected to apply in the period
in which the liability is settled or the asset realised,
based on tax rates (and tax laws) that have been
enacted or substantively enacted by the end of the
reporting period.
Deferred tax relating to items recognised in other
comprehensive income or equity is recognised in
other comprehensive income or equity, respectively.
26.2.13 Impairment
If the recoverable amount of an asset (or cash¬
generating unit) is estimated to be less than its
carrying amount, the carrying amount of the
asset (or cash-generating unit) is reduced to
its recoverable amount. An impairment loss is
recognized immediately in profit or loss, unless the
relevant asset is carried at a revalue amount, in which
case the impairment loss is treated as a revaluation
decrease.
Recoverable amount is the higher of fair value less
costs of disposal and value in use. In assessing value in
use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset for
which the estimates of future cash flows have not
been adjusted.
When an impairment loss subsequently reverses,
the carrying amount of the asset (or a cash¬
generating unit) is increased to the revised estimate
of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying
amount that would have been determined had no
impairment loss been recognized for the asset (or
cash-generating unit) in prior years. A reversal of
an impairment loss is recognized immediately in
profit or loss, unless the relevant asset is carried at
a revalued amount, in which case the reversal of the
impairment loss is treated as a revaluation increase.
At the end of each reporting period, the company
reviews the carrying amounts of its tangible,
intangible assets to determine whether there is
any indication that those assets have suffered an
impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in
order to determine the extent of the impairment
loss (if any). When it is not possible to estimate
the recoverable amount of an individual asset, The
Company estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
When a reasonable and consistent basis of allocation
can be identified,
Intangible assets with indefinite useful lives and
intangible assets not yet available for use are tested
for impairment at least annually, and whenever there
is an indication that the asset may be impaired.
Impairment of financial assets
Financial assets, other than those at Fair Value
through Profit and Loss (FVTPL), are assessed
for indicators of impairment at the end of each
reporting period. Financial assets are considered to
be impaired when there is objective evidence that,
as a result of one or more events that occurred
after the initial recognition of the financial asset, the
estimated future cash flows of the investment have
been affected. For Available for Sale (AFS) equity
investments, a significant or prolonged decline in the
fair value of the security below its cost is considered
to be objective evidence of impairment.
For all other financial assets, objective evidence of
impairment could include:
• Significant financial difficulty of the issuer or
counterparty;
• Breach of contract, such as a default or
delinquency in interest or principal payments;
• It becoming probable that the borrower will
enter bankruptcy or financial re-organisation;
or the disappearance of an active market
for that financial asset because of financial
difficulties.
For certain categories of financial assets, such
as trade receivables, assets are assessed for
impairment on individual basis. Objective evidence
of impairment for a portfolio of receivables could
include company’s past experience of collecting
payments, an increase in the number of delayed
payments in the portfolio past the average credit
period of zero days, as well as observable changes in
national or local economic conditions that correlate
with default on receivables.
For financial assets that are carried at cost, the
amount of impairment loss is measured as the
difference between the asset’s carrying amount and
the present value of the estimated future cash flows
discounted at the current market rate of return for a
similar financial asset. Such impairment loss will not
be reversed in subsequent periods.
The carrying amount of the financial asset is reduced
by the impairment loss directly for all financial
assets with the exception of trade receivables; such
impairment loss is reduced through the use of an
allowance account for respective financial asset.
When a trade receivable is considered uncollectible,
it is written off against the allowance account.
Subsequent recoveries of amounts previously
written off are credited against the allowance
account. Changes in the carrying amount of the
allowance account are recognized in profit or loss.
For financial assets measured at amortised cost,
if, in a subsequent period, the amount of the
impairment loss decreases and the decrease can
be related objectively to an event occurring after
the impairment was recognized, the previously
recognized impairment loss is reversed through
profit or loss to the extent that the carrying amount
of the investment at the date the impairment is
reversed does not exceed what the amortised cost
would have been had the impairment not been
recognized.
De-recognition of financial assets
The Company de-recognises a financial asset
when the contractual rights to the cash flows from
the asset expire, or when it transfers the financial
asset and substantially all the risks and rewards
of ownership of the asset to another party. If the
Company neither transfers nor retains substantially
all the risks and rewards of ownership and continues
to control the transferred asset, The Company
recognises its retained interest in the asset and an
associated liability for amounts it may have to pay.
If the Company retains substantially all the risks
and rewards of ownership of a transferred financial
asset, the Company continues to recognise the
financial asset and also recognises a collateralised
borrowing for the proceeds received.
On de-recognition of a financial asset in its entirety,
the difference between the asset’s carrying amount
and the sum of the consideration received and
receivable and the cumulative gain or loss that had
been recognized in other comprehensive income
and accumulated in equity is recognized in profit or
loss.
26.2.14 Financial instruments
Non-derivative financial instruments
Non-derivative financial instruments consist of:
• Financial assets, which include cash and
cash equivalents, trade receivables, unbilled
revenues, finance lease receivables, employee
and other advances, investments in equity and
debt securities and eligible current and non¬
current assets;
• Financial liabilities, which include long and
short-term loans and borrowings, bank
overdrafts, trade payables, eligible current and
non-current liabilities.
Non derivative financial instruments are recognized
initially at fair value including any directly attributable
transaction costs. Financial assets are derecognized
when substantial risks and rewards of ownership of
the financial asset have been transferred. In cases
where substantial risks and rewards of ownership
of the financial assets are neither transferred nor
retained, financial assets are derecognized only
when the Company has not retained control over
the financial asset.
Subsequent to initial recognition, non derivative
financial instruments are measured as described
below:
a) Cash and cash equivalents
For the purposes of the cash flow statement,
cash and cash equivalents include cash in hand,
at banks and demand deposits with banks,
net of outstanding bank overdrafts that are
repayable on demand and are considered part
of the Company’s cash management system.
In the statement of financial position, bank
overdrafts are presented under borrowings
within current liabilities.
b) Investments in liquid mutual funds, equity
securities (other than Subsidiaries, Joint
Venture and Associates)
These investments are measured at fair value
and changes therein, other than impairment
losses, are recognized through the Statement
of Profit & Loss. The impairment losses, if any,
are reclassified from equity into statement of
income. When an available for sale financial
asset is derecognized, the related cumulative
gain or loss recognised in equity is transferred
to the statement of income.
c) Loans and receivables
Loans and receivables are non-derivative
financial assets with fixed or determinable
payments that are not quoted in an active
market. They are presented as current assets,
except for those maturing later than 12
months after the reporting date which are
presented as non-current assets. Loans and
receivables are initially recognized at fair value
plus directly attributable transaction costs
and subsequently measured at amortized
cost using the effective interest method, less
any impairment losses. Loans and receivables
comprise trade receivables, unbilled revenues
and other assets.
The company estimates the un-collectability
of accounts receivable by analysing historical
payment patterns, customer concentrations,
customer credit-worthiness and current
economic trends. If the financial condition of
a customer deteriorates, additional allowances
may be required.
d) Trade and other payables
Trade and other payables are initially recognized
at fair value, and subsequently carried at
amortized cost using the effective interest
method. For these financial instruments, the
carrying amounts approximate fair value due to
the short-term maturity of these instruments.
e) Foreign Currencies Transactions
Transactions in foreign currencies are recorded
at the exchange rate prevailing on the date of
transaction.
Monetary assets and liabilities denominated
in foreign currencies are translated at the
functional currency closing rates of exchange
at the reporting date. Exchange differences
arising on settlement or translation of
monetary items are recognised in Statement
of Profit and Loss.
26.2.15 Materiality of income / expenditure:
An item of income or expenditure of one or more
prior periods is considered material only if, it exceeds
0.5% of total revenues of the company, as per last
years audited Financial Statements, in each such
case.
26.2.15 Earnings per Share
Basic EPS amounts are calculated by dividing the
profit for the quarter attributable to equity holders
of the parent by the weighted average number of
Equity shares outstanding during the quarter.
Diluted EPS amounts are calculated by dividing the
profit attributable to equity holders of the parent
(after adjusting for interest on the convertible
preference shares) by the weighted average number
of Equity shares outstanding during the quarter plus
the weighted average number of Equity shares that
would be issued on conversion of all the dilutive
potential Equity shares into Equity shares
26.2.16 Statement of Cash Flows
Cash flows are reported using the indirect method,
whereby profit/ (loss) before tax is adjusted for the
effects of transactions of non-cash nature and any
deferrals or accruals of past or future cash receipts
or payments.
26.2.17 Recent accounting pronouncements
> New and Amended Standards Adopted by
the Company:
Ind AS 8 - Accounting Policies, Changes in
Accounting Estimates and Errors
The amendments to Ind AS 8 clarify the
distinction between changes in accounting
estimates, changes in accounting policies and
the correction of errors. They also clarify how
entities use measurement techniques and
inputs to develop accounting estimates.
Ind AS 1 - Presentation of Financial
Statements
The amendments to Ind AS 1 provide guidance
and examples to help entities apply materiality
judgements to accounting policy disclosures.
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. This amendment does not have
any material impact on the Company’s financial
statements and disclosures.
Ind AS 12 - Income Taxes
The amendments to Ind AS 12 Income Tax
narrow the scope of the initial recognition
exception, so that it no longer applies to
transactions that give rise to equal taxable
and deductible temporary differences such
as leases and decommissioning liabilities. The
above amendments did not have any material
impact on the amounts recognised in prior
periods and are not expected to significantly
affect the current or future periods.
> New Standards/Amendments notified but not yet effective:
Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards under
Companies (Indian Accounting Standards) Rules as issued from time to time. During the year ended March 31,
2025, MCA has notified Ind AS 117 - Insurance Contracts and amendments to Ind As 116 - Leases, relating
to sale and lease back transactions, applicable from April 1, 2024. The Company has assessed that there is no
significant impact on its financial statements.
On May 9, 2025, MCA notifies the amendments to Ind AS 21 - Effects of Changes in Foreign Exchange Rates.
These amendments aim to provide clearer guidance on assessing currency exchangeability and estimating
exchange rates when currencies are not readily exchangeable. The amendments are effective for annual periods
beginning on or after April 1, 2025. The Company has assessed that there is no significant impact on its financial
statements.
ii) Fair Value Hierarchy
Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active
markets.
Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices
included within 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 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observable
market data (unobservable inputs).
(c) Liquidity Risk
Our liquidity needs are monitored on the basis of monthly and yearly projections. The company’s principal
sources of liquidity are cash and cash equivalents, cash generated from operations and availability of
funding through an adequate amount of committed credit facilities to meet obligations when due.
Due to the dynamic nature of underlying businesses, the company maintains flexibility in funding by
maintaining availability under committed credit lines.
Short term liquidity requirements consist mainly of sundry creditors, expense payable, employee dues
arising during the normal course of business as of each reporting date. The company maintains sufficient
balance in cash and cash equivalents to meet short term liquidity requirements.
The company assesses long term liquidity requirements on a periodical basis and manages them through
internal accruals and committed credit lines.
The table below provides details regarding the contractual maturities of non-derivative financial liabilities.
In accordance with Ind AS 33 - Earnings per share, the company has computed the Basic and Diluted Earnings
per Share (EPS) based on the net profit attributable to equity shareholders, as reported in the Statement of Profit
and Loss, and the weighted average number of equity shares outstanding during the period.
During the year, the Company had outstanding warrants convertible into equity shares. According to Paragraph
41 of Ind AS 33, potential ordinary shares shall be treated as dilutive when, and only when, their conversion
to ordinary shares would decrease earnings per share or increase loss per share from continuing operations.
However, these potential equity shares were not included in the calculation of Diluted EPS for the period, as
their effect was anti-dilutive.
The exercise price of the warrants was higher than the average market price of the share during the period,
making the EPS anti-dilutive. Therefore, it has not been considered for computing Diluted EPS as per Ind AS 33.
Accordingly, Diluted EPS is equal to Basic EPS for the current period.
26.3.17 Company has not revalued any Plant, Property or Equipment during the quarter or in previous year.
26.3.18 Company does not have any undisclosed income, which has not been recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessment under the Income tax Act, 1961 (such as,
search or survey or any other relevant provisions of the Income Tax Act,1961).
26.3.19 No proceeding has been initiated or pending against the company for holding any benami property under the Benami
Transaction (Prohibition) Act, 1988 (45 of 1988) and the rules made there under.
26.3.20 The Company has not traded or invested in Crypto Currency or Virtual Currency during the year.
26.3.21 Company has not been declared wilful defaulter by any bank/FI.
26.3.22 To the best of information available at the time of transactions, the Company has not done any transaction with
another company whose name was struck off at the time of transaction with the company.
26.3.23 Regrouping:
In order to have better presentation the previous year’s figures have been re-casted/restated/ reclassified, wherever
necessary, to conform to current year’s classification.
Our Report attached, For Uday Jewellery Industries Ltd.,
For Anant Rao & Mallik,
Chartered Accountants, Ritesh Kumar Sanghi Sanjay Kumar Sanghi
FRN:006266S Managing Director Director
DIN:00628033 DIN:00629693
(V Anant Rao)
Partner
Membership No.022644
Rakesh Agarwal Riya Jindal
Hyderabad Chief Financial Officer Company Secretary
Date: 28.05.2025 M.No.: A70615
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