L. Provisions and contingencies
Provisions are recognised when the Company has a present obligation 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 and a reliable estimate can be made of the amount of the obligation. The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change. Since the cash outflows can take place many years in the future, the carrying amounts of provisions and liabilities are reviewed regularly and adjusted to take account of changing facts and circumstances.
Contingent liabilities are disclosed unless the possibility of outflow of resources is remote. Contingent assets are neither recognised nor disclosed in the Financial Statements.
M. Employee Benefits
i) Shortterm employee benefits:
The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees renderthe services.
ii) The Company is exempted from Payment of Gratuity Act, 1972 in view of its strength of employees being less than threshold limit attracting the applicability of the said statute and as such no provision has been made for the said liability. Leave encashment is not provided on actuarial basis in view of employees being less than 10 and same is charged on actual basis.
N. Earnings Per Share
i) Basic Earnings per share:
Basic earnings per share is computed by dividing the net profit for the period attributable to the equity shareholders of the Company by the weighted average number of equity shares outstanding during the financial year. The weighted average number of equity shares outstanding during the financial year and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding, without a corresponding change in resources.
ii) Diluted Earnings per share:
For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.
O. Critical Estimates and Judgments.
The preparation of the financial statements required the Management to exercise judgment and to make estimates and assumptions. These estimates and associated assumptions are based on historical experiences and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an on-going basis. Revision to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future period.
The areas involving critical estimates or judgements are:
i. Estimated useful life of Tangible Assets
The Company reviews the useful lives and carrying amount of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation and amortisation expense in future periods.
ii. Estimation of Current Tax Expense and Income Tax Payable / Receivable
The calculation of Company's tax charge necessarily involves a degree of estimation and judgement in respect of certain items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as appropriate, through a formal legal process. The final resolution of some of these items may give rise to material adjustment to taxable profits/losses.
iii. Impairmentof Financial Assets
At each balance sheet date, based on historical default rates observed over expected life, the management assesses the expected credit loss on outstanding receivables.
iv. Recognition of deferred tax assets
The extent to which deferred tax assets can be recognised is based on an assessment of the probability of the future taxable income against which the deferred tax assets can be utilised.
v. Contingent liabilities
At each balance sheet date basis, the management judgment, changes in facts and legal aspects, the Company assesses the requirement of provisions against the outstanding warranties and guarantees. However, the actual future outcome may be differentfrom thisjudgement.
vi. Fair value measurements
Management applies valuation techniques to determine the fair value of financial instruments (where active market quotes are not available). This involves developing estimates and assumptions consistent with how market participants would price the instrument.
I. Fair value hierarchy
The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are
(a) recognised and measured at fair value and,
(b) measured at amortised cost and for which fair values are disclosed in the financial statements.
To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into the three levels prescribed under the Indian accounting standard. An explanation of each level is as follows:
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. Forexample, listed equity instruments that have quoted market price.
Level 2: The fair value of financial instruments that are not traded in an active market (forexample, traded bonds, over-the- counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.
II. Valuation techniques used to determinefairvalue
Significant valuation techniques used to value financial instruments include: • the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date.
o Use of quoted market price or dealer quotes for similar instruments o Using discounted cash flow analysis.
The fair values computed above for assets measured at amortised cost are based on discounted cash flows using a current borrowing rate. They are classified as level 2 fair values in the fairvalue hierarchy due to the use of unobservable inputs.
26 Financial Risk Management
The Company has exposure to thefollowing risks arising from financial instruments:
• Credit risk;
• Liquid ity risk; and Ý Market risk
A. Credit risk
Cred it risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The company is exposed to credit risk from its operating activities (primarily for trade receivables and loans) and from its financing activities (deposits with banks and otherfinancial instruments).
Credit risk management
Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the cred it worthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments.
The Company’s maximum exposure to credit risk as at 31 March,2023 and 2024 is the carrying valueof each class of financial assets
i Trade and other receivables
Credit risk on trade receivables is limited based on past experience and management's estimate.
ii Cash and Cash Equivalents
The Company held cash and bank balance with credit worthy banks of Rs. 8,12,286.47 at 31 st March 2024, and (Rs. 44,666/- at March 31,2023). The credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks where credit risk is largely perceived to be extremely insignificant.
B. Liquidity risk
Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. For the Company, liquidity risk arises from obligations on account of financial liabilities-trade payables and borrowings.
Liquidity risk management
The Company’s approach to managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions. A material and sustained shortfall in our cash flow could undermine the Company’s credit rating and impair investor confidence.
The Company maintained a cautious funding strategy, with a positive cash balance throughout the year ended 31 st March, 2024 and 31 st March, 2023. This was the result of cash delivery from the business. Cash flow from operating activities provides the funds to service the financing of financial liabilities on a day-to-day basis. The Company’s treasury department regularly monitors the rolling forecasts to ensure it has sufficient cash on-going basis to meet operational needs. Any short term surplus cash generated by the operating entities, over and above the amount required for working capital management and other operational requirements, are retained as cash and cash equivalents (to the extent required).
C. Market risk
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments. The Company is exposed to market risk primarily related to interest rate risk and the market value of the investments.
i. Currency Risk
The functional currency of the Company is Indian Rupee. Currency risk is not material, as the Company does not have any exposure in foreign currency.
ii. Interest Rate Risk
Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the i nterest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates.
Exposure to interest rate risk
According to the Company interest rate risk exposure is only for floating rate borrowings. Company does not have any floating rate borrowings on any of the Balance Sheet date disclosed in this financial statements.
iii Price Risk
Price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. It arises from financial assets such as investments in quoted instruments.
a Fairvalue sensitivity analysisforfixed rate Instruments
The Company does not account for any fixed rate financial assets or financial liabilities at fair value through Profit or Loss. Therefore, a change in interest rates at the reporting date would not affect Profit or Loss.
b Cash flow sensitivity analysis for variable rate Instruments
The company does not have any variable rate instrument in Financial Assets or Financial Liabilities. The company is exposed to price risk from its investment in equity instruments classified in the balance sheet at fa ir value through other comprehensive income.
27 Capital Management
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.
The capital structure of the Company is based on management’s judgement of the appropriate balance of key elements in order to meet its strategic and day-today needs. We consider the amount of capital in proportion to risk and manage the capital structure in light of changes in economic conditions and the risk characteristics of the underlying assets.
The management monitors the return on capital as well as the level of dividends to
shareholders. The Company will take appropriate steps in order tomaintain, or if
necessary adjust, its capital structure.
30 Additional Regulatory Information
(i) The Company does not have any immovable property, hence no disclosure regarding title deeds of Immovable Property (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) is required to be disclosed.
(ii) During the year, the Company has not revalued its Property, Plant and Equipment (including Right-of-Use Assets).
(iii) The company does not hold any intangible assets during the year March 31,2024.
(iv) No proceedings have been initiated during the year or are pending against the Company as at March 31,2024 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder.
(v) No Loans or Advances in the nature of loans has been granted to promoters, Directors, KMPsand the related parties (as defined under Companies Act, 2013) during the year.
(vi) (vi) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.
(vii) The Company has not borrowed any amount from banks or financial institutions on the basis of security of current assets.
(viii) As per the information available with us, the Company did not have any transactions with companies struck off during thefinancial year.
(ix) Following Ratios to be disclosed:-
Other Notes to Accounts
32. Micro, Small and Medium Enterprises
The Company has no dues to Micro, Small and Medium enterprises as at 31stMarch, 2024, on the basis of information provided by the parties and available on record. Further, there is no interest paid / payable to micro and small enterprises during the said financial year.
34. Segment Information
Company is engaged in the business of Trading in Shares and incidental activities thereto which, in the context of Ind AS 108 on Operating Segments, constitutes a single reportable segment.
35. Balance written off during the Year
i. The Goods and Service tax (GST) have been written off during the year as per Management Estimates and tax opinions obtained stating that the said amount is not payable.
36. The Company has a sum of Rs. 7,70,35,646.19 payable to a Broker, i.e. Guiness Securities Limited (GSL).
This amount remains unpaid towards the Broker because the Broker has pledged shares without our consent which were purchased through him that are worth more than the liability. The Securities and Exchange Board of India (SEBI), acting as the market regulator, has revoked the registration certificate of Guiness Securities Limited (GSL) due to multiple offences. These offences include, but are not limited to, the misappropriation of client securities, diversion of proceeds by misappropriating securities to related parties, failure to report data under enhanced supervision to stock exchanges, falsification of books of account, insolvency, non-settlement of client funds and securities.
37. Balance Confirmation
The debit and credit balances for Unsecured Loans (Loan from Companies & Loan from Related Parties), Advances, Debtors, Creditors and other Balances are subject to confirmation and reconciliation.
38. Dues/Outstanding Demand pertaining to Previous Assessment Years
Any Dues and/or Outstanding demands pertaining to any previous Financial Years, preceding the financial year under audit that are served after the end of the financial year under audit are disclosed in the Financial Statements of the year in which such communication or Demand Notice/Order have been served.
39. Prior Year Comparatives
Previous year figures have been regrouped, re-arranged or reclassified wherever necessary to conform to the current year classification. Figures in brackets pertain to previous year.
For B M Gattani & Co. For MONOTYPE INDIA LIMITED
Chartered Accountants (CIN : L72900MH1974PLC287552)
ICAI FRN : 113536W
Balmukund N Gattani (Naresh Jain) (Suryakant Kadakane)
Proprietor Whole Time Director & CFO Director
Membership No. 047066 DIN: 00291963 DIN: 02272617
UDIN : 24047066BKABIJ4522
Date: 28/05/2024 (Prerna Mehta)
Place: Mumbai Company Secretary
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