2.13 Provision, Contingent Liabilities and Contingent Assets:
A provision is recognised when the company has a present obligation as a result of past event
and it is probable that an outflow of resources will be required to settle the obligation, in
respect of which reliable estimate can be made.
If the effect of the time value of money is material, provisions are discounted using a current
pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting
is used, the increase in the provision due to the passage of time is recognized as a finance
cost.
Contingent Assets and Contingent Liabilities are not recognized in the financial statements.
28 Financial risk management
The Company has exposure to the following risks arising from financial instruments:
(i) Market risk
(a) Interest rate risk;
(ii) Credit risk and ;
(iii) Liquidity risk
Risk management framework
The Company's activities expose it to a variety of financial risks, including market risk . The Company's
primary risk management focus is to minimize potential adverse effects of risks on its financial performance.
The Company's risk management assessment policies and processes are established to identify and
analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such
risks and compliance with the same. Risk assessment and management of these policies and processes
are reviewed regularly to reflect changes in market conditions and the Company's activities. The Board
of Directors and the Audit Committee are responsible for overseeing these policies and processes.
(i) Market risk
Market risk is the risk of changes in the market prices on account of foreign exchange rates, interest
rates and Commodity prices, which shall affect the Company's income or the value of its holdings of
its financial instruments . The objective of market risk management is to manage and control market
risk exposure within acceptable parameters, while optimising the returns.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. The Company's exposure to market risk
for changes in interest rates relates to borrowings from banks and others.
Interest rate sensitivity - variable rate instruments
A reasonably possible change of 100 basis points in interest rates at the reporting date would
have increased /(decreased) equity and profit or loss by amounts shown below. This analysis
assumes that all other variables, in particular, foreign currency exchange rates, remain constant.
This calculation also assumes that the change occurs at the balance sheet date and has been
calculated based on risk exposures outstanding as at that date.
(ii) Credit risk
Credit risk is the risk of financial loss to the company if a customer or counterparty to a financial
instrument fails to meet its contractual obligations and arises principally from the company's
receivables from customer. The Company establishes an allowance for doubtful debts, impairement
and expected credit loss that represents it estimate an allowance for doubtful debts, impairment
and expected credit loss that represents its estimate on epected credit loss.
A. Trade receivables
The Company's exposure to credit riskis influenced mainly by the individual characteristics of
each customer. The demographics of the customer , including the default risk of the industry
has an influence on credit risk assessment. Credit risk managed through credit approvals
establishing credit limits and continuously monitoring the creditwor thiness of customers to
which the Company grants credit terms in the normal course of business.However, the company
doesnot expect any losses from non-performance by these counter-parties apart from those
already given in financials, and does not have any significant concentration of exposures.
B. Cash and cash equivalents
The Company holds cash and cash equivalents with creditworthy banks of 1 83.17 thousands.
The credit worthiness of such banks is evaluated by the management on an on-going basis
and is considered to be good.
(iii) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they
become due. The Company has been taking measures to ensure that the Company's cash flow
from business borrowing is sufficient to meet the cash requirements for the Company's operations.
The Company managing its liquidity needs by monitoring forecasted cash inflows and outflows in
day to day business. Liquidity needs are monitor endonvarious time bands, on a day to day and
week to week basis, as well as on the basis of a rolling 30 day projections. Net cash requirements
are compared to available working capital facilities in order to determine head room or any shortfalls.
Presently company's objective is to maintain sufficient cash to meet its operational liquidity
requirements.
29 The company has complied with the number of layers prescribed under clause (87) of section 2 of the
Act read with the Companies (Restriction on number of layers) Rules, 2017.
30 The Company does not have any Benami property, where any proceeding has been initiated or pending
against the Company for holding any Benami property.
31 The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond
the statutory period.
32 The Company has not been declared wilful defaulter by any bank or financial institution or government
or any government authority.
33 The company has not any such transactions which is not recorded in the books of accounts that has
been surrendered or disclosed as income during the year in the tax assessments under the Income Tax
Act, 1961 (such as, search or survey or any other relevant provision of the Income Tax Act, 1961).
34 Balance shown under receivables, payables and advances are subject to confirmation.
35 The Company did not have any long- term contracts including derivative contracts for which there were
any material foreseeable losses.
36 There has been no delay in transferring amounts, required to be transferred, to the Investor Education
and Protection Fund by the Company.
37 The company does not have transactions with the companies struck off under section 248 of Companies
Act ,2013.
38 The financial statements were approved for issue by the Board of Directors on 30th May, 2024.
39 Previous year's figures have been re- arranged or re- grouped wherever considered necessary.
40 Figures have been rounded off to the nearest Lacs of rupees.
41 Figures in brackets indicate negative (-) figures.
Signed for the purpose of Identification
FOR BHATTER & ASSOCIATES For and on behalf of the Board of Directors of
Chartered Accountants Rishab Special Yarns Limited
Firm Regn. No.131411W
Sd/- Sd/- Sd/-
CA Gopal Bhatter Ganesh Yadav Anuj Kumar Singh
Partner Managing Director Executive Director
Membership No. 411226 DIN: 10783218 DIN: 10679898
UDIN: 25411226BMIQLU7958
Mumbai, the 30th day of May 2025
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