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Accounting Policies of Mercury Ev-Tech Ltd. Company

Mar 31, 2023

Significant Accounting policies

1.2 BASIS OF PREPARATION

i. Compliance with Ind AS

The financial statements comply in all material aspects with Indian Accounting
Standards ("Ind AS”) notified under section 133 of the Companies Act, 2013 ("the Act”),
Companies (Indian Accounting Standards) Rules, 2015 as amended by Companies
(Indian Accounting Standards) (Amendment) Rules, 2016 and other relevant provisions
of the Act as applicable.

The accounting policies are applied consistently to all the periods presented in the
financial statements.

ii. Historical cost convention

The financial statements have been prepared on a historical cost basis, except the
following:

• Certain financial assets and liabilities that are measured at fair value;

• Assets held for sale - measured at lower of carrying amount or fair value less cost
to sell;

• Defined benefit plans - plan assets measured at fair value.

iii. Current and non-current classification

All assets and liabilities have been classified as current or non-current as per the
Company''s normal operating cycle (not exceeding twelve months) and other criteria set
out in the Schedule III to the Act.

iv. Functional and presentation currency

These financial statements are presented in Indian Rupees, which is the Company''s
functional currency.

v. Rounding of amounts

All amounts disclosed in the financial statements and notes have been rounded off to
the nearest lakhs as per the requirement of Schedule III, unless otherwise stated.

1.3 SIGNIFICANT ACCOUNTING POLICIES

A. Property, Plant and Equipment:

i. Recognition and measurement

Freehold land is carried at cost. All other items of property, plant and equipment are
measured at cost less accumulated depreciation and any accumulated impairment
losses. Cost includes expenditure that is directly attributable to the acquisition of the
items.

Income and expenses related to the incidental operations, not necessary to bring the
item to the location and condition necessary for it to be capable of operating in the
manner intended by management, are recognized in the Statement of Profit and
Loss.

If significant parts of an item of property, plant and equipment have different useful
life, then they are accounted and depreciated for as separate items (major
components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is
recognized in the Statement of Profit and Loss.

Capital work in progress is stated at cost and includes the cost of the assets that are
not ready for their intended use at the Balance Sheet date.

On transition to Ind AS, the Company has elected to continue with the carrying value
of all of its property, plant and equipment recognized as at April 1,2016 measured as
per the Previous GAAP and use that carrying value as the deemed cost (except to the
extent of any adjustment permissible under other accounting standard) of the
property, plant and equipment.

ii. Subsequent Expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic
benefits associated with the expenditure will flow to the Company.

C. Impairment:

i. Non - financial assets

At each balance sheet date, the Company assesses whether there is any indication
that any property, plant and equipment and intangible assets with finite life may be
impaired. If any such impairment exists, the recoverable amount of an asset is
estimated to determine the extent of impairment, if any. Where 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.

D. Inventories:

i. Finished and Semi-Finished Products produced and purchased by the company are
carried at Cost and net realizable value, whichever is lower.

ii. Work in Progress is carried at lower of cost and net realizable value.

iii. Raw Material is carried at lower of cost and net realizable value.

iv. Stores and Spares parts are carried at cost. Necessary provision is made and
expensed in case of identified obsolete and nonmoving items.

Cost of Inventory is generally ascertained on the ''Weighted average'' basis. Work in
progress, Finished and semi-finished products are valued at on full absorption cost
basis.

Cost Comprises expenditure incurred in the normal course of business in bringing such
inventories to its location and includes, where applicable, appropriate overheads based
on normal level of activity. Packing Material is considered as finished goods.
Consumable stores are written off in the year of Purchase.

E. Foreign Currency Transactions

Transactions in Foreign Currency and Non-Monetary Assets are accounted for at the
Exchange Rate prevailing on the date of the transaction. All monetary items
denominated in Foreign Currency are converted at the Year-End Exchange Rate. The
Exchange Differences arising on such conversion and on settlement of the transactions
are recognized as income or as expenses in the year in which they arise.

F. Investments and Other Financial Assets:

Classification

The Company classifies its financial assets in the following measurement categories:

• Those to be measured subsequently at fair value (either through other
comprehensive income, or through Statement of Profit and Loss), and

• Those measured at amortized cost.

The classification depends on the Company''s business model for managing 115

financial assets and the contractual terms of the cash flows. For assets measured at
fair value, gains and losses will either be recorded in Statement of Profit and Loss or
other comprehensive income. For investments in debt instruments, this will depend on
the business model in which the investment is held. 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.

The Company reclassifies debt or equity investments when and only when its business
model for managing those assets changes.

Measurement

At initial recognition, in case of a financial asset not at fair value through profit and loss,
the Company measures a financial asset at its fair value plus, transaction costs that are
directly attributable to the acquisition of the financial asset. Transaction costs of
financial assets carried at fair value through Statement of Profit and Loss are expensed
in Statement of Profit and Loss.

(a) Amortized cost: Assets that are held for collection of contractual cash flows where
those cash flows represent solely payments of principal and interest are measured at
amortized cost.

(b) Fair Value through Other Comprehensive Income (FVOCI): Assets that are held for
collection of contractual cash flows and for selling the financial assets, where the
assets'' cash flows represent solely payments of principal and interest, are measured
at FVOCI. Movements in the carrying amount are taken through Other
Comprehensive Income (OCI), except for the recognition of impairment gains or
losses, interest revenue and foreign exchange gains and losses which are recognized
in Statement of Profit and Loss. When the financial asset is derecognized, the
cumulative gain or loss previously recognized in OCI is reclassified from equity to
profit and loss and recognized in other gains/ losses. Interest income from these
financial assets is included in other income using the effective interest rate method.

(c) Fair value through profit and loss: Assets that do not meet the criteria for amortized
cost or FVOCI are measured at fair value through Statement of Profit and Loss.
Interest income from these financial assets is included in other income.

Equity Instruments

The Company subsequently measures all equity investments at fair value. Where the
Company''s management has elected to present fair value gains and losses on equity
investments in OCI, there is no subsequent reclassification of fair value gains and
losses to Statement of Profit and Loss. Dividends from such investments are
recognized in Statement of Profit and Loss as other income when the Company''s right
to receive payment is established.

Changes in the fair value of financial assets at fair value through profit and loss are
recognized in other gain/losses in the Statement of Profit and Loss. Impairment losses
(and reversal of impairment losses) on equity investments measured at FVOCI are not
reported separately from other changes in fair value.

Derecognition

11A

A financial asset is derecognized only when

(a) The Company has transferred the rights to receive cash flows from the financial
asset or

(b) Retains the 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.

G. Cash and Cash Equivalents:

Cash and cash equivalents in the balance sheet comprise cash at banks and on hand
and highly liquid investments with an original maturity of three months or less, which
are subject to an insignificant risk of changes in value.

H. Financial Liabilities:

Measurement

All financial liabilities are recognized initially at fair value and in the case of loans,
borrowings and payables recognized net of directly attributable transaction costs.

The Company''s financial liabilities include trade and other payables, loans and
borrowings and derivative financial instruments.

Derecognition

A financial liability is derecognized when the obligation under the liability is discharged
or cancelled or expires. Gains and losses are recognized in Statement of Profit and
Loss when the liabilities are derecognized as well as through the EIR amortization
process.

I. Revenue recognition:

Revenue from contracts with customers is recognised when control of the goods or
services are transferred to the customer at an amount that reflects the consideration to
which the Company expects to be entitled in exchange for those goods or services.

Revenue from the sale of goods is recognized at the point in time when control of the
asset is transferred to the customer, generally on the delivery of the goods. Revenue is
recognisable to the extent of the amount that reflects the consideration (i.e. the
transaction price) to which the Company is expected to be entitled in exchange for
those goods or services excluding any amount received on behalf of third party (such
as indirect taxes).

J. Other Income:

Other income is comprised primarily of interest income, dividend income, gain/loss on
investments and exchange gain/loss on forward and options contracts and on
translation of other assets and liabilities. Interest income is recognized using the
effective interest method. Claims for export incentives/ duty drawbacks, duty refunds
and insurance are accounted when the right to receive payment is established. Dividend
Income is recognized when the right to receive dividend is established.

K. Employee benefits:

A. Short term employee benefits:

All employee benefits payable wholly within twelve months of rendering the service
are classified as short term employee benefits. Benefits such as salaries, v117i s,

performance incentives, etc. are recognized at actual amounts due in the period in
which the employee renders the related service.

B. Contribution towards defined benefit contribution Schemes
Gratuity plan

The Company has a defined benefit gratuity plan. Every employee who has completed
five years or more of service is eligible for gratuity on post-employment at 15 days
salary (last drawn salary) for each completed year of service as per the rules of the
Company. The aforesaid liability is provided for on the basis of an actuarial valuation on
projected unit credit method made at the end of the financial year. Current service cost,
Past-service costs are recognized immediately in Statement of profit or loss.

Re-measurement gains and losses arising from experience adjustments and changes in
actuarial assumptions are charged or credited to equity in other comprehensive income
in the period in which they arise. They are included in retained earnings in the statement
of changes in equity and in the balance sheet. Re measurements are not reclassified to
profit or loss in subsequent periods.

L. Borrowing costs:

Borrowing costs directly attributable to the acquisition, construction or production of a
qualifying asset that necessarily takes a substantial period of time to get ready for its
intended use or sale are capitalized as part of the cost of the asset. All other borrowing
costs are expensed in the period in which they occur.

M. Taxes on Income:

Income Tax expense comprises of current and deferred tax. Income Tax expense is
recognized in net profit in the Statement of Profit and Loss except to the extent that it
relates to items recognized directly in equity, in which case it is recognized in other
comprehensive income.

(i) Current Tax

Current Tax is the amount of income taxes payable (recoverable) in respect of the
taxable profit (tax loss) for a period. Current tax for current and prior periods is
recognized at the amount expected to be paid to or recovered from the tax
authorities, using the tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date

Current tax assets and liabilities are offset if, and only if, the Company:

a) has a legally enforceable right to set off the recognized amounts; and

b) intends either to settle on a net basis, or to realize the asset and settle the liability
simultaneously.

Deferred tax is recognized in respect of temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used
for taxation purposes.

Deferred tax assets are recognized for unused tax losses, unused tax credits and
deductible temporary differences to the extent that it is probable that future taxable
profits will be available against which they can be used. Deferred tax assets are
reviewed at each reporting date and are reduced to the extent that it is no lon118
probable that the related tax benefit will be realized; such reductions are reversed when
the probability of future taxable profits improves. Unrecognized deferred tax assets are
reassessed at each reporting date and recognized to the extent that it has become
probable that future taxable profits will be available against which they can be used.

The measurement of deferred tax reflects the tax consequences that would follow from
the manner in which the Company expects, at the reporting date, to recover or settle the
carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) the entity has a legally enforceable right to set off current tax assets against current
tax liabilities; and

b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied
by the same taxation authority on the same taxable entity.


Mar 31, 2014

I) Basis Of Prepration :

The Financial Statements are prepared as per historical cost convention and in accordance with the Generally Accepted Accounting Principles (GAAP) in India, the provisions of the Companies Act 1956, read with General Circular No:15/2013 dated 13th September, 2013, issued by the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013 and the applicable Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006. The company follows mercantile systems of accounting and recognised income and expenditures on accrual basis except in case of significant uncertainties relating to income.

ii) Use of Estimates :

The preparation of financial statements in conformity with generally accepted principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates.

iii) Fixed assets & Depreciation :

There is not fixed assets held by the company.

Depreciation

There is no Fixed assets held by company hence no Depreciation is provided.

Amortization

No Amortization of preliminary or preoperative expenses as there are no balance in these Accounts.

iv) Inventories :

Inventories of shares & securities are valued at cost.

Other Traded inventories Valued at lower of the cost or Net realisable value.

Cost of Inventories comprises of cost of purchase and other cost incurred in the bringing the inventories to their present location and condition.

v) Revenue Recognition :

Sales are recognized on completion of sale of goods and are recorded net of VAT.

Dividend income is recognized when the right to receive the same is established.

vi) Employee Benefits :

Liabilities in respect of Gratuity & other retirement benefits is not provided in the Books of Account.

vii) Impairment of Assets :

There is no fixed assets held by the company. And hence company is not required to provide for any impairment loss in the financial statements.

viii) Taxes on Income :

As company has incurred loss during the year. Hence no tax provision is made. Due to loss in current year no MAT provision is required to be made by the company. Further in view of loss carry forward of the previous year no deferred tax provision is made by the company.

ix) Earning per Share :

The company reports basic and diluted Earnings Per Share (EPS) in accordance with Accounting Standard 20 on Earnings Per Share. Basic EPS is computed by dividing the net profit or loss for the year by the weighted average number of Equity shares outstanding during the year.

x) Investments :

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as non current investments. All Investments are stated at cost. A provision for diminution is made only in case of permanent diminution in value of such securities.

xi) Provisions, Contingent Liabilities and Contingent Assets :

Provisions involving a substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the accounts by way of a note. Contingent assets are neither recognized nor disclosed in the financial statements.

xii) Borrowing Costs

As there is no Term Loan, Secured or unsecured loan taken for expansion or for addition of Fixed Assets, disclosure under the accounting statdard - 18 for borrowing cost not provided.


Mar 31, 2013

A. BASIS OF ACCOUNTING:-

Financial statement is prepared under the historical cost conversion. The company follows mercantile systems of accounting and recognized income & expenditure on accrual basis except in case of significant uncertainties relating to income.

B. REVENUE RECOGNITION :-

Sales are recognized on completion of sale of goods and are recorded net of vat.

C. FIXED ASSETS :-

There is not fixed assets held by the company.

D. DEPRECIATION & AMORTIZATION:- i) DEPRECIATION:-

There is no Fixed assets held by company hence no Depreciation is provided.

ii) AMORTIZATION:-

No Amortization of preliminary or preoperative expenses as there are no balance in these Accounts.

E. INVESTMENT:-

Investment are stated at cost.

F. INVENTORIES :-

Inventories of shares & securities are valued at cost.

G. RETIREMENT BENEFITS :-

Liabilities in respects of Gratuity & other retirement benefits is not provided in the Books of Account.

H. CONVERSION OF TRANSACTION IN FOREIGN CURRENCY:-

No Foreign currency transaction done during the year.

I. BORROWING COST:-

No Term Loan , Secured or unsecured loan taken for expansion and addition of Fixed Assets

J. DIVIDEND :-

Dividend income is recognized when the right to receive the same is established. During the year there is no receipt of Dividend income.

K. TAX PROVISION:-

As company has incurred loss during the year. Hence no tax provision is made. Due to loss in current year no MAT provision is required to be made by the company. Further in view of loss carry forward of the previous year no deferred tax provision is made by the company.

During The Previous Year Company Has Availed OTS Scheme As Prescribed By GOG With The Charotar Nagrik Bank Ltd H.P A/C 72 Vide Their Letter Dated 13/12/2011 Company Has To Pay Rs.33014386 Is Payable On Rs. 1375600 Monthly 24 Installment And Simple Interest @ 7% Thereon. But The Company Has Not Paid Any Installment And Interest Due Against The Above Scheme During The Year 2012-13 During The Previous Year Company Has Availed OTS Scheme As Prescribed By GOG With The Charotar Nagrik Bank Ltd. B/P. A/C No.2 Vide Their Letter Dated 13/12/2011 Company Has To Pay Amount Of Rs.73,84,451 Is Payable on Rs. 309768 Instalment And Simple Interst @7% Thereon. But The Company Has Not Paid Any Installment And Interest Due Against The Above Scheme During The Year 2012-13.

The Above Balances Are Subject To Completion Of OTS Scheme By The Company In Prescribed Time Period.


Mar 31, 2012

A. BASIS OF ACCOUNTING:-

Financial statement is prepared under the historical cost conversion. The company follows mercantile systems of accounting and recognized income & expenditure on accrual basis except in case of significant uncertainties relating to income.

B. REVENUE RECOGNITION :-

Sales are recognized on completion of sale of goods and are recorded net of vat.

C. FIXED ASSETS :-

Fixed assets are stated at cost. Cost of acquisition in inclusive of freight, duties, taxes and other directly attributable cost incurred to bring the assets to their working condition for intended use. During the year Company has disposed off Fixed Assets held by the co.

D. DEPRECIATION & AMORTIZATION:-

i) DEPRECIATION:-

Depreciation is provided up to the date of sold on Written Down Value Method on fixed Assets at the rate specified in Schedule XIV to the companies Act, 1956.

ii) AMORTIZATION:-

No Amortization of preliminary or preoperative expenses as there are no balance in these Accounts.

E. INVESTMENT:- Investment are stated at cost.

F. INVENTORIES :-

Inventories of shares & securities are valued at cost.

G. RETIREMENT BENEFITS :-

Liabilities in respects of Gratuity & other retirement benefits is not provided in the Books of Account.

H. CONVERSION OF TRANSACTION IN FOREIGN CURRENCY:- No Foreign currency transaction done during the year.

I. BORROWING COST:-

No Term Loan , Secured or unsecured loan taken for expansion and addition of Fixed Assets J. DIVIDEND :-

Dividend income is recognized when the right to receive the same is established. During the year there is no receipt of Dividend income.

K. INTEREST:-

During the year company has provided interest ' 2,03,69,965.51 i.e. difference of excess liabilities raised for amount payable on OTS Scheme with Charotar Nagrik Sahkari Bank Ltd. After adjusting FD and FD Interest accured there on.

L. TAX PROVISION:-

As company has incurred loss during the year. Hence no tax provision is made. Due to loss in current year no MAT provision is required to be made by the company. Further in view of loss carry forward of the previous year no deferred tax provision is made by the company.

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