A.12 Provisions and contingent liabilities
Provisions are recognized in the balance sheet when the company has a present obligation (legal or constructive) as a result of a past event, which is expected to result in an outflow of resources embodying economic benefits which can be reliably estimated. Each provision is based on the best estimate of the expenditure required to settle the present obligation at the balance sheet date. When appropriate, provisions are measured on a discounted basis.
Constructive obligation is an obligation that derives from an entity’s actions where:
(a) By an established pattern of past practice, published policies or a sufficiently specific current statement, the entity has indicated to other parties that it will accept certain responsibilities And
(b) As a result, the entity has created a valid expectation on the part of those other parties that it will discharge those responsibilities.
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or nonoccurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.
A.13 Employee benefits
Defined contribution plans
Payments to defined contribution plans are charged as an expense as they fall due. Payments made to state managed retirementbenefit schemes are dealt with as payments to defined contribution schemes where the company's obligations under the schemesare equivalent to those arising in a defined contribution retirement benefit scheme.
Defined benefit plans
For defined benefit retirement schemes the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuation being carried out at each balance sheet date. Re-measurement gains and losses of the net defined benefit liability/ (asset) are recognized immediately in other comprehensive income. The service cost, net interest on the net defined benefit liability/ (asset) is treated as a net expense with in employment costs.
Past service cost is recognized as an expense when the plan amendment or curtailment occurs or when any related restructuring costs or termination benefits are recognized, whichever is earlier.
The retirement benefit obligation recognized in the balance sheet represents the present value of the defined-benefit obligation.
Short term compensated Absences/Leave Encashment
Liability in respect of Compensated absences/ leave encashment due is recognized on the basis of undiscounted value of estimatedamount required to be paid or estimated value of benefit expected to be availed by the employees.
A.14 Earnings Per Share (EPS)
The earnings considered in ascertaining the company’s EPS comprise the Net Profit or Loss for the period after tax. The basic EPS is computed on the basis of weighted average number of equity shares outstanding during the year. The number of shares for computation of diluted EPS comprises of weighted average numbers of equity shares considered for deriving basic EPS and also the weighted average numbers of equity shares, which could be issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year unless they are issued at a later date. The diluted potential equity shares are adjusted for the proceeds receivable assuming that the shares are actually issued at fair value. The number of shares and potentially dilutive shares are adjusted for share splits/reverse share splits (consolidation of shares) and bonus shares, as appropriate.
A.15 Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profits before tax is adjusted for the effects of transactions of a non- cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.
A.16 Borrowing Costs
Borrowings costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for the intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
23. The Company has not recognized deferred tax assets in respect of losses as there is no reasonable certainty supported by convincing evidence of their recoverability in the near future.
24. Some of the balances of Loans, Other advances and trade receivables are subject to reconciliation and confirmation from respective parties. The balances of said items are taken as shown by the books of accounts. The ultimate outcome of such reconciliation and confirmation cannot presently be determined, therefore, no provision has been made that may result out of such reconciliation and confirmation.
In the opinion of management, advances given to other are in ordinary course of business and are not loans or advances in the nature of loans, hence classified accordingly.
25. The Company’s Business activity falls within two business segment i.e. “Rendering of Services” & “Trading of Goods”. The Company operates in only one geographical segment i. e. domestic. Segment information are given as per the provisions of Ind AS 108.
Revenue and identifiable operating expenses in relation to segments are categorized based on items that are individually identifiable to that segment.
Assets and liabilities used in the Company's business are not identified to any of these portable segments, as these are used interchangeably between segments. Management believes that it is currently not practicable to provide segment disclosures relating to total assets and liabilities since a meaningful segregation of the available data is onerous.
26. Financial risk management financial risk
The Company's activities expose it to a variety of financial risks: market risk and liquidity risk which is given as under;
a) Market risk
The market risk to the Company is foreign exchange risk. The company use to sale foreign currency for payment received from foreign customer for rendering of consultancy services from bank at effective rate on transaction date, any measures of hedging is not used.
b) Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due.
Management monitors rolling forecasts of the liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which the entity operates.
The company's principal sources of liquidity are cash and cash equivalents and the cash flow that is generated from operations. The company believes that the working capital is sufficient to meet its current requirements.
As of 31 March, 2024, the Company had a working capital of INR 11,563.34 including cash and cash equivalents of INR 3,200.17. As of March 31, 2023, the Company had a working capital of INR 10,181.97 including cash and cash equivalents of INR 1,950.74.
28. Employee Benefits:
1- Post-Employment Obligations - Gratuity
The Company provides gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees' last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of years of service. For the funded plan the Company makes contributions to recognised funds in India. 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 estimations of expected gratuity payments.
The amounts recognised in the Statement of Financial Position and the movements in the net defined benefit obligation over the year are as follows:
3. Actuarial Assumptions
Company attention was drawn to provisions of accounting standard that actuarial assumptions are an entity’s best estimates of variables that will determine the ultimate cost of providing post-employment benefits and shall be unbiased & mutually compatible.
a) Economic Assumptions
The principal assumptions are the discount rate & salary growth rate. The discount rate is generally based upon the market yields available on Government bonds at the accounting date relevant to currency of benefit payments for a term that matches the liabilities. Salary growth rate is company’s long term best estimate as to salary increases & takes account of inflation, seniority, promotion, business plan, HR policy and other relevant factors on long term basis as provided in relevant accounting standard. These valuation assumptions are as follows & have been received as input from you.
c) Any changes in assumptions from previous valuation are evident as above tables show assumptions of previous & current valuation. Any changes in assumptions are reported by the Company.
d) Company attention was drawn to provisions of accounting standard that actuarial assumptions are an entity’s best estimates of variables that will determine the ultimate cost of providing post-employment benefits and shouldbe unbiased & mutually compatible. Determination of actuarial assumptions depend on factors such as nature of business & industry, retention policy, demand & supply in employment market, standing of the company, businessplan, HR Policy etc. I do not have access to or possess full knowledge of all these factors & has used the assumptions provided by the company. Under the circumstances, I consider the assumptions provided by the company are in generality reasonable
4. Actuarial Method
a) I have used the projected unit credit (PUC) actuarial method to assess the plan's liabilities allowing for retirement, death-in-service and withdrawal and also compensated absence while in service.
b) Under the PUC method a projected accrued benefit is calculated at the beginning of the period and again at the end of the period for each benefit that will accrue for all active members of the plan. The projected accrued benefit is based on the plan accrual formula and upon service as at the beginning and end of the period, but using member's final compensation, projected to the age at which the employee is assumed to leave active service. The plan liability is the actuarial present value of the projected accrued benefits as on the date of valuation for active members.
28a. Leave Encashment
Provision for leave encashment in respect of unavailed leaves standing to the credit of employees is made on actuarial basis. The Company does not maintain any fund to pay for leave encashment.
28b. Defined Contribution Plans
The Company also has defined contribution plan i.e. contributions to provident fund in India for employees. The Company makes contribution to statutory fund in accordance with Employees Provident Fund and Misc. Provision Act, 1952. This is post-employment benefit and is in the nature of defined contribution plan. The contributions are made to registered provident fund administered by the government. The provident fund contribution charged to statement of profit & loss for the year ended 31 March, 2024 amount to Rs. 45.38 Thousand (P.Y. Rs. 28.50 Thousands).
30. Standards issued and amended but not 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. For the year ended 31st March 2024,MCA has not notified any new standards or amendments to the existing standards applicable to the Company.
31. (a). 'No funds have been advanced/loaned/invested (from borrowed fund or from share premium or from any other sources/kind of fund) by the company to any other person(s) or entity(ies), including foreign entities(intermediaries), with the understanding (whether recorded in writing or otherwise) that the intermediary shall (i) directly or indirectly lend or invest in other person or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or (ii) provide any guarantee, security or like to or on behalf of the Ultimate Beneficiaries.
(b). No funds have been received by the company from any person(s) or entity(ies), including foreign entities (funding Parties), with the understanding (whether recorded in writing or otherwise) that the company shall (i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
32. Additional regulatory information required by Schedule-III of Companies Act 2013
i) Relationship with struck off companies: The Company do not have any relationship with companies struck off undersection 248 of Companies Act 2013 or Section 560 of Companies Act 1956.
ii) Details of Benami Property: No proceeding has been initiated or are pending against the Company for holding any Benami property under Benami Transaction (Prohibition) Act 1988 and the Rules made thereunder.
iii) Compliance with numbers of layer of Companies: The Company has complied with the number of layers prescribedunder Companies Act 2013.
iv) Compliance with approved Scheme of Arrangement: The Company has not entered into any scheme of arrangementwhich has an accounting impact on current or previous financial year.
v) Undisclosed Income: There is no income surrendered or disclosed as income during current or previous year in the taxassessment under the Income Tax Act 1961 that has not been recorded in books of accounts.
vi) Details of Crypto Currency or Virtual Currency: The Company has not traded or invested in crypto currency or virtualcurrency during the current or previous year.
33. The Company has used an accounting software for maintaining its books of account for the year ended 31st March 2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software.
34. The Previous year figures have been regrouped/ reclassified, wherever necessary, to make them comparable with current year figures.
As per our report attached of even date.
For B S D & Co.
Chartered Accountants
Firm Registration No: 000312S For and on behalf of the Board
Sd/- Sd/- Sd/-
Sujata Sharma Atul Kumar Mishra Satish Kumar Grover
Partner Director Director
M No. 087919 DIN: 00297681 DIN: 05242073
UDIN: 24087919BKEOEO5064
Place: New Delhi
Date: 28th May, 2024
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