l. Provisions and Contingent liability
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation but, there is uncertainty about the timing or amount of the future expenditure required in settlement. When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit or loss net of any reimbursement.
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 recognised as a finance cost.
Contingent liabilities are disclosed in the Notes. Contingent liabilities are disclosed for
i. possible obligations which will be confirmed only by future events not wholly within the control of the Company or
ii. present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.
m. Employee benefits Short-term obligations
Short-term employee benefit are expensed as the related service is provided. Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within one year after the end of the period in which the employees render the related service are the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
Other long-term employee benefit obligations
The liabilities for earned leave and sick leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation. Re-measurements as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.
The company does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months and accordingly amounts have been classified as current and non current based on actuarial valuation report.
Post-employment obligations
The Company operates the following post-employment schemes:
i. defined benefit plans such as gratuity, pension, and
ii. defined contribution plans such as provident fund, superannuation fund,
Defined benefit plans
The liability or asset recognised in the balance sheet in respect of defined benefit pension and gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation. The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the statement of profit and loss. Re-measurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in OCI (other comprehensive income). They are included in retained earnings in the statement of changes in equity and in the balance sheet. Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as past service cost.
Defined contribution plans
The Company pays provident fund contributions to publicly administered provident funds as per local regulations. The Company has no further payment obligations once the contributions have been paid. The contributions are accounted for as defined contribution plans and the contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.
n. Financial instruments Financial assets
Initial recognition and measurement
All financial assets are recognised initially at fair value.
The classification depends on the Company's business model for managing the financial asset and the contractual terms of the cash flows. The Company classifies its financial assets in the following measurement categories:
i. those measured at fair value (either through other comprehensive income (FVOCI), or through profit or loss (FVPL)) and
ii. those measured at amortised cost,
Subsequent measurement
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income (FVOCI). All other financial assets are measured at amortised cost, using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss.
Impairment of financial assets
The Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss financial assets that are not fair valued.
The Company follows 'simplified approach' for recognition of impairment loss for trade receivables that have no significant financing component. The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized, is recognized under the head 'other expenses' in the statement of profit and loss.
The Company does not have any purchased or originated credit-impaired (POCI) financial assets, i.e., financial assets which are credit impaired on purchase/ origination.
De-recognition of financial assets
The Company derecognizes a financial asset when -
i. the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under IND AS 109.
ii. it retains contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to pay the cash flows to one or more recipients.
When the entity has neither transferred a financial asset nor retained substantially all risks and rewards of ownership of the financial asset, the financial asset is de-recognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to extent of continuing involvement in the financial asset.
Financial liabilities Initial recognition
All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification, as described below:
Trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within one year after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Borrowings are de-recognised when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other gains/(losses).
Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least one year after the reporting period.
Derivative financial instruments
Derivative financial instruments such as forward contracts, to hedge its foreign currency risks are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value with changes in fair value recognised in the Statement of profit and loss in the period when they arise.
o. Earnings per share
The basic earnings per share is computed by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The Company does not have any potential equity share or warrant outstanding for the periods reported, hence diluted earnings per share is same as basic earnings per share of the Company.
p. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (CODM). The Board of Directors of the Company, assesses the financial performance and position of the Company, and makes strategic decisions. The Board of Directors is therefore considered to be the chief operating decision maker.
q. Non-current assets held for sale
The Company classify a non-current asset (or disposal group) as held for sale if, (i) the Company intends to sell the asset, (ii) the asset is available for immediate sale in its present condition, (iii) the Management has initiated a plan to sell and (iv) the sale is highly probable.
Non-current assets held for sale are measured at the lower of carrying amount and fair value less costs to sell. The determination of fair value less costs to sell includes use of management estimates and assumptions. The fair value of the assets held for sale has been estimated using valuation techniques including using the comparative price approach, which includes unobservable inputs.
An asset that ceases to be classified as held for sale shall be measured at the lower of carrying amount before the non-current asset was classified as held for sale adjusted for any depreciation/ amortization and its recoverable amount at the date when the asset no longer meets the "Held for sale” criteria. Recoverable amounts of assets reclassified from held for sale have been estimated using management's assumptions which consist of significant unobservable inputs.
r. Critical estimated and judgements
i Estimation of Expected credit loss on Loans:
The Company analyses credit risk and expected credit loss on loans on individual basis. If contractual payments are more than 30 days past due, the item is considered as significant increase in credit risk, else the same is considered as good. For measurement of expected credit loss, value of collateral is also considered. In case the value of collateral exceeds loan amount plus accrued interest, then expected credit loss amount would be estimated as nil.
ii Estimation of provision against litigation and other provision:
Provision is a liability of uncertain timing oramount.The Company recognises provision when it hasa present obligation (legal or constructive) as a result of a past event, where economic outflow is probable, and a reliable estimate can be made of the amount of the obligation. The use of estimates is an essential part of the preparation of financial statements. This is especially true in the case of provisions, which by their nature are more uncertain than most other items in the balance sheet. The Company determine a range of possible outcomes and make an estimate of the obligation that is sufficiently reliable to use in recognising a provision. Assumptions are reviewed at each reporting date. As on balance sheet date the provision against litigation and other provision mainly relates to electricity matters. These are further disclosure in note 12 and note 32.
iii Goodwill:
Goodwill is tested for impairment at least annually or when events occur or changes in circumstances indicate that the recoverable amount is less than its carrying value. The recoverable amount is higher of value-in-use and fair value less cost to sell. The calculation involves use of significant estimates and assumptions which includes turnover and earnings multiples, growth rates and net margins used to calculate projected future cash flows, risk-adjusted discount rate, future economic and market conditions. Refer note 35.
iv Determining Lease term for Right-of-use assets:
As described in the significant accounting policies, the Company reviews the lease term for assets taken on lease at the end of each reporting period.
v Defined benefit obligation:
The cost of the defined benefit plans and the present value of the defined benefit obligation are based on actuarial valuation using the projected unit credit method. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, employee turnover rate and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Also refer note 13.
vi Impairment of Trade receivables:
The impairment allowance for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company's past history, existing market conditions as well as forward looking estimates at the end of each reporting period. In calculating expected credit loss, the Company has also considered credit reports and other related credit information for its customers to estimate the probability of default in future. Assumptions are reviewed at each reporting date. Refer note 27(a).
vii Income Taxes:
Significant judgments are involved in determining the provision for income taxes, including amount expected to be paid/recovered for uncertain tax positions.
Estimation of fair value
The frequency of valuations depends upon the changes in fair values of the items of investment property being valued. Since frequent valuations are unnecessary, with only insignificant changes in fair value, the company obtains independent valuation for its investment properties once in five years, from registered valuers as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017. The fair market value is done by valuers is based on physical inspection of properties and using comparable transfer instances of the similar type of properties of nearby locations, and with the prevailing market rates.
Note : Information about individual provisions
(i) Provision against litigation:
Provision is for disputed liabilities under litigation awaiting final conclusion.
Provision is for disputed liabilities under litigation of -
(i) Electricity duty on power generated by the Company - Rs. 289.80 lakhs (31-Mar-23: Rs. 289.80 lakhs); matter pending with Hon'ble Supreme Court.
(ii) CSS/ASC on power purchased under captive mechanism by the Company - Rs. 3,225.31 lakhs (31-Mar-23: 3,191.92 lakhs), further explained in note 32.
(iii) Supplementary bill for IPP power - Rs. 93.27 lakhs (31-Mar-2023: Rs. 93.27 lakhs); matter pending with APTEL”
The amount of provisions made by the Company is based on the estimates made by the Management considering the facts and circumstances of each case.
The timing and the amount of cash flows that will arise from these matters will be determined from the final decision of these cases by appellate authorities.
(ii) Other provision
Other provision is for probable liability of electricity duty on power generated by the Company. As on balance sheet date no demand has been raised on the Company, but on prudent basis a provision has been recognised. The management estimates that no cash outflow is expected within 12 months from the balance sheet date, hence entire provision is classified as non-current.
(i) Leave obligations -
The leave obligation covers the Company's liability for accumulated leaves that can be encashed or availed. The company does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience , the company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months and accordingly amounts have been classified as current and non current based on actuarial valuation report.
(ii) Defined benefit plans: a Gratuity -
The Company provides for gratuity for employees as per the terms of employment. Employees who are in continuous service at least for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is calculated at the last drawn monthly basic salary multiplied by 15 days salary for each completed years of service of the employee. The scheme is funded with Life Insurance Corporation of India (LIC). The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimate of expected gratuity payments.
In addition, employees who have completed 20 years of service are eligible to additional gratuity computed at last drawn monthly basic salary multiplied by 7 days salary for each completed years of service of the employee. The additional gratuity benefit is unfunded.
Pension - The Company operates defined benefit pension plan for the Director (retired as Managing Director in FY 2019-20). The amount of pension per month is a fixed amount and is paid to the Director.
Post his passing, the family pension will be payable to his spouse, and this family pension per month will also be the same fixed amount, and is payable as long as the spouse survives. The Company has not funded the liability.
The net liability disclosed above relates to both funded and unfunded plans. The Company has no legal obligation to settle the deficit in the funded plans with an immediate contribution or additional contribution. The Company intends to contribute in line with the recommendations of the fund administrator and the actuary.
ab As at March 31,2023 and March 31,2022, plan assets were invested in funds managed by insurer (LIC).
ac Through its defined benefit plans, the Company is exposed to number of risks, the most significant of which are detailed below:
Asset Volatility:
The Plan liabilities are calculated using a discount rate set with reference to government bond yields. If plan assets underperform, this yield will create a deficit. The plan asset investments are in funds managed by insurer. These are subject to interest rate risk.
Changes in bond yield:
A decrease in government bond yields will increase plan liabilities, although this may be partially offset by an increase in the returns from plan asset.
b Defined benefit liability and employer contributions:
ba The Company ensures that the investment positions are managed within an asset-liability matching (ALM) framework that has been developed to achieve long-term investments that are in line with the obligations under the employee benefit plans. Within the framework, the Company's ALM objective is to match assets to the gratuity obligations by investing in funds with LIC in the form of a qualifying insurance policy. The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations. The Company has not changed the process used to manage its risks from previous periods.
bb The Company expects to contribute Rs.170 lakhs to the defined benefit plan during the next annual reporting period.
bc The weighted average duration of the defined benefit obligation for gratuity and pension is 7.71 and 11.87 years respectively (31 March 2023: 8.25 and 12.58 years). The expected maturity analysis of undiscounted pension and gratuity is as follows:
The Company's business activities are exposed to a variety of financial risks, namely liquidity risk, market risks and credit risk. The Company's senior management has the overall responsibility for establishing and governing the Company's risk management framework. The Company's risk management policies are established to identify and analyze the risks faced by the Company, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policy accordingly. The key risks and mitigating actions are also placed before the Audit Committee of the Company.
a. Management of Credit Risk
Credit risk is the risk that a counterparty will not meet its obligations under a contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its investing activities, including Loans, Deposits with banks and Other financial instruments.
(i) Trade receivables:-
Trade receivables are generally unsecured, except for sales which are generally covered by letters of credit and some parties in where security is obtained in the nature of bank guarantee. Customer credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. An impairment analysis is performed at each reporting date on an individual basis for major customers. The Company evaluates the customer credentials carefully from trade sources before appointment of any distributor and only financially sound parties are appointed as distributors. The Company secures adequate deposits from its distributor and hence risk of bad debt is limited. The credit outstanding is sought to be limited to the sum of advances/deposits and credit limit determined by the company. The company have stop supply mechanism in place in case outstanding goes beyond agreed limits. To measure the expected credit loss, trade receivables have been grouped based on the days past due. The expected loss rates are based on the payment profiles of sales over a period of 36 months before the reporting date and the corresponding credit loss experienced within this period. The historical loss rates are adjusted to reflect current and forward looking information on macroeconomic factors such as expected industry growth, GDP, unemployment rate etc. affecting the ability of the customer to settle the receivables.
ii) Loans and Other financial assets:-
Credit risk on cash and cash equivalents is limited as the company generally invests in deposits with banks and financial institutions with high credit ratings assigned by domestic credit rating agencies.
The Company also invest in inter corporate loans. Such loans are approved by the Investment and Borrowing Committee. The Company charges interest on such loans considering nature of security and countparty's credit rating.
Other financial assets that are potentially subject to credit risk consists of investment in perpetual bonds of banks and lease deposits carried at amortised cost. Investment in liquid mutual fund units and alternate investment fund units, carried at fair value, are considered to have low credit risk.
The Company assesses the recoverability from these financial assets on regular basis. Factors such as business and financial performance of counterparty, their ability to repay, regulatory changes and overall economic conditions are considered to assess future recoverability. An impairment analysis is performed at each reporting date on an individual basis. Based on assessment performed management has concluded that impact of expected credit loss is not material and the current provision made against Loans and Other financial assets is adequate to cover the expected credit loss. The Company's maximum exposure to credit risk is the carrying value of each class of financial assets.
b. Management of Liquidity Risk
Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities. The Company's approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses or risking damage to company's reputation. In doing this, management considers both normal and stressed conditions.
Management monitors the rolling forecast of the company's liquidity position on the basis of expected cash flows. This monitoring includes financial ratios and takes into account the accessibility of cash and cash equivalents.
The company has access to funds from debt markets through loan from banks. The company invests its surplus funds in bank deposits and debt based mutual funds.
Note 27: Financial risk management (Contd.)
c. Management of Market Risk:
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of fluctuation in market prices. These comprise three types of risk i.e. currency rate, interest rate and other price related risks. Financial instruments affected by market risk include loans and borrowings, deposits, financial assets and liabilities in foreign currency, investments in quoted instruments and derivative financial instruments. Regular interaction with bankers, intermediaries and the market participants help us to mitigate such risk.
i) Foreign currency risk
The primary market risk to the Company is foreign exchange risk. After taking cognisance of the natural hedge, the company selectively takes hedges to mitigate its risk resulting from adverse fluctuations in foreign currency exchange rate(s).
When a derivative is entered into for the purpose of hedge, the Company negotiates the terms of those derivatives to match the terms of the underlying exposure. For hedges of forecast transactions the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency.
The company uses foreign exchange forward contracts to hedge its exposure in foreign currency risk. During the year ended March 31,2024, the company did not have any hedging instruments with terms which were not aligned with those of the hedged items.
iii) Price Risk and Sensitivity:
The Company is mainly exposed to the price risk due to its investment in mutual funds, market linked debentures and alternate investment funds. The price risk arises due to uncertainties about the future market values of these investments. As on 31-Mar-24, such investments amounts to Rs. 4851.51 lakhs (31 March 2023: Rs.2974.76 lakhs). These are exposed to price risk. Change in price of debt liquid mutual funds are very minimal hence the same is not considered in price risk disclosure.
The Company has laid policies and guidelines which it adheres to in order to minimise price risk arising from investments in various funds.
A 1% increase in prices would have led to approximately an additional Rs.48.52 lakhs gain in the Statement of profit and loss (31 March 2023: Rs.29.75 lakhs gain). A 1% decrease in prices would have led to an equal but opposite effect.
Note 28: Capital management
The Company's capital comprises equity share capital, share premium, retained earnings and other equity attributable to equity holders.
The Company's objectives when managing capital are to :
- safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and
- maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.
Note 29: Segment information
The Board of Directors examines the Company's performance based on the products and geographic perspective and has identified below mentioned reportable segments of its business as follows:
Paper : The Paper segment relates to manufacturing (including processing) and marketing of various types of speciality papers, consisting Opaque Laminating Base,Glassine, Base paper,Bible Paper, etc.
Hygiene products: The Hygiene products segment relates to processing and marketing of tissue and other hygiene papers as well as marking and trading of other hygiene products.
Segment Revenue, Result, Assets and Liabilities include the respective amounts identifiable to each of the segments and amount allocated on a reasonable basis. Unallocated expenditure/income consist of common expenditure incurred for all the segments and expenses incurred or interest/ investment income earned at corporate level. The assets and liabilities that cannot be allocated between the segments are shown as unallocated assets and unallocated liabilities respective ly.
The accounting policies of the reportable segments are the same as the Company's accounting policies described in Note 2. The operating segments reported are the segments of the Company for which separate financial information is available. Profit before tax (PBT) are evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance. The Company's financing (including finance costs and finance income) and income taxes are reviewed on an overall basis and are not allocated to operating segments. Sales between segments are carried out at arm's length. The segment revenue is measured in the same way as in the Statement of profit or loss.
Note 32: Provision for Electricity surcharge
The Company had purchased power (i.e. electricity) from Sai Wardha Power Generation Limited (SWPGL) in earlier years under the Group Captive mechanism. This purchase of power under Group Captive mechanism was exempt from the levy of Cross Subsidy Surcharge (CSS) and Additional Surcharge (ASC) subject to certain conditions.
However, in respect of such a supply, Maharashtra Electricity Regulatory Commission (MERC) vide its orders dated 15.02.2019, 22.10.2020 and 29.10.2020 has held that the supplies of the year 2018-19 (involving CSS and ASC of Rs.863.39 lakhs) and of the year 2016-17 and 2017-18 (involving CSS and ASC and interest thereon aggregating of Rs. 2449.59 lakhs), are not eligible for exemption from the levy of CSS and ASC and, therefore, these amounts are payable. The entire matter is decided by appellate authorities and subsequently by the MERC substantially in the favour of the Company. However the matter is currently pending decision by the Hon'ble Supreme Court.
Although in terms of Power Delivery Agreement (PDA) with SWPGL, the levy of CSS/ASC, if imposed or demanded, was liable to be paid/reimbursed by SWPGL to the Company. However, the National Company Law Tribunal, Hyderabad, under Insolvency and Bankruptcy Code, 2016 vide its order dated 17th October, 2019 has terminated the said PDA without surviving any of SWPGLs obligation and liabilities. Consequently, the Company is carrying provision in the accounts, for aggregate demand of Rs. 3,312.98 lakhs (including paid under protest (net of refund) Rs.87.67 lacs (31 March 2023 Rs.121.06 lacs)).
Note 35: Impairment
(a) Goodwill has arisen as per the Scheme of arrangement and reconstruction(demerger) approved by Hon'ble Bombay High Court dated January 8, 2016 (the Scheme). Goodwill reflects the difference between the fair value of shares issued and all the net assets transferred at carrying value under the scheme. The net carrying amount of goodwill pertains to the operating segment - Paper division.
Goodwill is tested for impairment at least annually in accordance with the Company's procedure for determining the recoverable value of each CGUs.
(b) The recoverable amount is the higher of its fair value less cost to sell and its value in use. The fair value is determined based on market value less cost to sell while the value in use is determined based on specific calculations. These calculations use pre-tax cash flow projections for the company over a period of 5 years. An average of the range of each assumption used is mentioned in table below.
Note 39: Reclassification
Previous year figure's have been reclassified to conform to this year's classification.
The accompanying notes are an integral part of the financial statements
As per our report of date attached For and on behalf of the board of directors of Pudumjee Paper Products Limited
For ] M AGRAWAL & CO V.K.Beswal A.KJatia
Firm Registration No - 100130W Director Executive Chairman
Chartered Accountants
Punit Agrawal H.PBirla Dr.Ashok Kumar
Partner Chief Financial Officer Executive Director
Membership No - 148757
Place : Mumbai Place : Mumbai
Date : 27th May 2024 Date : 27th May 2024
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