Accounting Policies of Afcons Infrastructure Ltd. Company

Mar 31, 2026

B. Material accounting policies

1.B.1. Goodwill

Goodwill represents the cost of acquired business as
established at the date of acquisition of the business
in excess of the acquirer''s interest in the net fair value
of the identifiable assets, liabilities and contingent
liabilities less accumulated impairment losses, if any.
Goodwill is tested for impairment annually or when

events or circumstances indicate that the implied fair
value of goodwill is less than its carrying amount.

For the purposes of impairment testing, goodwill is
allocated to each of the Company''s cash-generating units
(or groups of cash-generating units) that is expected to
benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been
allocated is tested for impairment annually, or more
frequently when there is an indication that the unit
may be impaired. If the recoverable amount of the
cash-generating unit is less than its carrying amount,
the impairment loss is allocated first to reduce the
carrying amount of any goodwill allocated to the unit
and then to the other assets of the unit pro rata based
on the carrying amount of each asset in the unit.
Any impairment loss for goodwill is recognised directly in
profit or loss. An impairment loss recognised for goodwill
is not reversed in subsequent periods.

On disposal of the relevant cash-generating unit, the
attributable amount of goodwill is included in the
determination of the profit or loss on disposal.

I.B.2. a) Interests in Joint Operations

Company enters into Joint Venture arrangement
with other parties for execution of construction
arrangements for which an unincorporated vehicle is
formed having an independent legal status for the tax
purpose i.e. Association of person/Body of individual
etc. Such arrangement (also called as joint operations)
is considered as extension of business, if in accordance
with the terms of the arrangement, Company acts as
a principal and remains solely liable for the executing
the entire project on its own, funding or contributing
assets and is also responsible for all the liabilities in
the unincorporated vehicle. Accordingly, all the assets,
liabilities, revenue and expenses pertaining to such
unincorporated vehicle is consolidated in the separate
financial statements of the Company.

Similarly, in case the Company is acting as an agent in
such kind of arrangements, where the other party to the
arrangement is solely liable for the executing the entire
project on its own, funding or contributing assets and is
also responsible for all the liabilities in the unincorporated
vehicle. Accordingly, the Company recognises its share
of profits/fees as determined in the arrangement in the
separate financial statements of the Company.

I.B.2. b) Interest in unincorporated Joint ventures

When the Company enters into a joint venture (JV)
arrangement with other parties and an unincorporated
vehicle is formed which has a separate status for tax
purposes (i.e. Association of person/Body of individual
etc.) and if as per the terms of agreement, the Company
remains liable for all the liabilities of the unincorporated
vehicle and is also responsible for funding or contributing
assets to the unincorporated vehicle for construction
activity, this unincorporated vehicle (also considered
and called as joint operation) has been considered as
an extension of the Company from accounting point of
view and assets, liabilities, revenue and expenses are
consolidated on the basis of its share in the operations
in the separate financial statement of the Company.

1.B.3.Revenue recognition
Sale of goods

Revenue from sale of goods is recognised upon
satisfaction of performance obligations, i.e. at a point
of time, which occurs when the control is transferred
to the customer. Customers obtain control as per the
incoterms. Invoices are issued according to contractual
terms and are usually payable as per the credit period
agreed with the customer.

Rendering of services:

Revenue from providing services is recognised in the
accounting period in which the services are rendered.

Invoices are issued according to contractual terms
and are usually payable as per the credit period agreed
with the customer.

Construction contracts:

The Company recognises revenue from engineering,
procurement and construction contracts (''EPC'') over the
period of time, as performance obligations are satisfied
over time due to continuous transfer of control to the
customer. EPC contracts are generally accounted for as
a single performance obligation as it involves complex
integration of goods and services.

the contract includes price variation clause or there are
amendments in contracts, the Company estimates the
amount of consideration to which it will be entitled in
exchange for work performed.

Due to the nature of the work required to be performed
on the performance obligations, the estimation of total
revenue and cost at completion is complex, subject
to many variables and requires significant judgment.
Variability in the transaction price arises primarily due
to liquidated damages, price variation clauses, changes
in scope, incentives, discounts, if any. The Company
considers its experience with similar transactions and
expectations regarding the contract in estimating the
amount of variable consideration to which it will be
entitled and determining whether the estimated variable
consideration should be constrained. The Company
includes estimated amounts in the transaction price
to the extent it is probable that a significant reversal
of cumulative revenue recognised will not occur
when the uncertainty associated with the variable
consideration is resolved. The estimates of variable
consideration are based largely on an assessment of
anticipated performance and all information (historical,
current and forecasted) that is reasonably available.
Various agreements are entered with customers wherein
the Company pays a certain portion of the finance cost
to the funding agencies of the project. In practice, these
payments are considered as payment on behalf of the
customer. These payments are not related to a distinct
service or product by customer. An estimated amount to
be paid over the lifecycle of the project is calculated and
accordingly the same is accounted for as a reduction of
contract revenue.

Progress billings are generally issued upon completion of
certain phases of the work as stipulated in the contract.
Billing terms of the over-time contracts vary but are
generally based on achieving specified milestones.
The difference between the timing of revenue recognised
and customer billings result in changes to contract
assets and contract liabilities. Payment is generally due
upon receipt of the invoice, payable within 90 days or less.
Contractual retention amounts billed to the customers
are generally due upon expiration of the contract period
or any other conditions as mentioned in the contract.

until final contract settlement is not considered a
significant financing component since it is usually
intended to provide customer with a form of security
for Company''s remaining performance as specified
under the contract, which is consistent with the industry
practice. Contract liabilities represent amounts billed
to customers in excess of revenue recognised till date.
A liability is recognised for advance payments and it is not
considered as a significant financing component since it
is used to meet working capital requirements at the time
of project mobilization stage. The same is presented as
contract liability in the statement of financial position.
Amounts received before the related work is performed
are disclosed in the Balance Sheet as contract liability
and termed as "Advances from customerâ.

Estimates of revenues, costs or extent of progress
toward completion are revised if circumstances change.
Any resulting increases or decreases in estimated
revenues or costs are reflected in profit or loss in the
period in which the circumstances that give rise to the
revision become known by management.

For construction contracts the control is transferred
over time and revenue is recognised based on the extent
of progress towards completion of the performance
obligations. When it is probable that total contract costs
will exceed total contract revenue, the expected loss is
recognised as an expense immediately. The percentage
of completion is based primarily on contract cost
incurred to date compared to total estimated contract
cost for each contract in order to reflect the effective
completion of the project. This percentage of completion
could be based on technical milestones or as per the
contractual terms specified. A construction contract is
considered completed when the last technical milestone
is achieved, which occurs upon contractual transfer of
ownership of the asset.

Dividend and interest income

Interest income from a financial asset is recognised
when it is probable that the economic benefits will flow
to the Company and the amount of income can be
measured reliably. Interest income is accrued on a time
basis, by reference to the principal outstanding and at
the effective interest rate applicable, which is the rate

that exactly discounts estimated future cash receipts
through the expected life of the financial asset to that
asset''s net carrying amount on initial recognition.

Other operating income

Income from export incentives is recognised on
cash basis to the extent the ultimate realisation is
reasonably certain.

1.B.4. Foreign currencies

(i) Functional and presentation currency

Items included in the standalone financial statements
of each of the Company''s entities are measured using
the currency of the primary economic environment in
which the entity operates (''the functional currency'').
The standalone financial statement is presented in
Indian Rupee (INR), which is Company''s functional
and presentation currency. For each entity (branches
and Joint Operations), the Company determines the
functional currency and items included in the financial
statements of each entity are measured using that
functional currency.

In preparing these Standalone financial statements, the
Company has applied following policies:

A) Foreign Branches of the Company (outside India
with functional currency other than presentation
currency): -

1. Income and expense items are translated
at the exchange rates at the dates of the
transactions and all resulting exchange
differences are recognised in the Standalone
Statement of Profit and Loss.

2. Non-monetary assets and liabilities are
measured in terms of historical cost in
foreign currencies and are not translated at
the rates prevailing at the reporting period.
Monetary assets and liabilities are translated
at the rates prevailing at the end of each
reporting period. Exchange differences on
translations are recognised in the Standalone
Statement of Profit and Loss.

B) Joint Operations and subsidiaries outside India
with functional currency other than presentation
currency:

1. Assets and liabilities, both monetary and
non-monetary are translated at the rates
prevailing at the end of each reporting year.

2. Income and expense items are translated at
the average exchange rates for the period,
unless exchange rates fluctuate significantly
during that period, in which case the exchange
rates at the dates of the transactions are
used. Exchange differences arising, if any, are
recognised in other comprehensive income
and accumulated in equity (and attributed to
non-controlling interests as appropriate).

(ii) Foreign currency transactions and balances

In preparing the standalone financial statements
of each individual Company entity, transactions
in currencies other than the entity''s functional
currency (foreign currencies) are recognised at
the rates of exchange prevailing at the dates of the
transactions. At the end of each reporting period,
monetary items denominated in foreign currencies
are retranslated at the rates prevailing at that date.
Non-monetary items carried at fair value that are
denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair
value was determined. Non-monetary items that
are measured in terms of historical cost in a foreign
currency are not retranslated.

Exchange differences on monetary items are
recognised in Statement of Profit and Loss in the
period in which they arise except for:

â¢ Exchange differences on transactions
entered into in order to hedge certain foreign
currency risks; and

â¢ Exchange differences on monetary items
receivable from or payable to a foreign
operation for which settlement is neither
planned nor likely to occur (therefore forming
part of the net investment in the foreign
operation), which are recognised initially in
other comprehensive income and reclassified
from equity to profit or loss on repayment of
the monetary items.

On the disposal of a foreign operation (i.e. a disposal
of the Company''s entire interest in a foreign
operation, a disposal involving loss of control over a
foreign operation, or a partial disposal of an interest
in a foreign operation of which the retained interest
becomes a financial asset), all of the exchange
differences accumulated in equity in respect of
that operation attributable to the owners of the
Company are reclassified to profit or loss.

In addition, in relation to a partial disposal of
a foreign operation that does not result in the
Company losing control over the foreign operation,
the proportionate share of accumulated exchange
differences is re-attributed to non-controlling
interests and are not recognised in profit or loss.
For all other partial disposals (i.e. partial disposals
of associates or joint arrangements that do not
result in the Company losing significant influence
or joint control), the proportionate share of the
accumulated exchange differences is reclassified
to profit or loss.

Goodwill and fair value adjustments to identifiable
assets acquired and liabilities assumed
through acquisition of a foreign operation are
treated as assets and liabilities of the foreign
operation and translated at the rate of exchange
prevailing at the end of each reporting period.
Exchange differences on such items are recognised
in other comprehensive income.

I.B.5. Borrowing costs

Borrowing 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 their intended use or sale.

Interest income earned on the temporary investment
of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs
eligible for capitalisation.

All other borrowing costs are recognised in profit or loss
in the period in which they are incurred.

I.B.6. Employee benefits

1.B.6.1 Retirement benefit costs and termination benefits

Employee benefits include provident fund, superannuation
fund, employee state insurance scheme, gratuity fund,
compensated absences and leave encashment.

Payments to defined contribution retirement benefit
plans are recognised as an expense when employees
have rendered service entitling them to the contributions.

The liability or asset recognised in the balance sheet in
respect of defined benefit plan is the present value of
the defined benefit obligation at the end of the reporting
period less fair value of plan assets.

For defined retirement benefit plans, the cost of providing
benefits is determined using the Projected Unit Credit
Method, with actuarial valuations being carried out at the
end of each annual reporting period. Re-measurement,
comprising actuarial gains and losses, the effect of
the changes to the asset ceiling (if applicable) and the
return on plan assets (excluding net interest), is reflected
immediately in the balance sheet with a charge or credit
recognised in other comprehensive income in the period
in which they occur. Remeasurement recognised in
other comprehensive income is reflected immediately in
retained earnings and is not reclassified to profit or loss.
Past service cost is recognised in profit or loss in the
period of a plan amendment. Net interest is calculated by
applying the discount rate at the beginning of the period
to the net defined benefit liability or asset.

Defined benefit costs are categorised as follows:

â¢ Service cost (including current service cost,
past service cost, as well as gains and losses on
curtailments and settlements);

â¢ Net interest expense or income; and

â¢ Re-measurement

The Company presents the first two components of
defined benefit costs in profit or loss in the line item
''Employee benefits expense''. Curtailment gains and
losses are accounted for as past service costs.

The present value of the defined benefit plan liability is
calculated using a discount rate which is determined
by reference to market yields at the end of the reporting
period on government bonds.

The retirement benefit obligation recognized in the
standalone financial statements represents the actual
deficit or surplus in the Company''s defined benefit plans.
Any surplus resulting from this calculation is limited to
the present value of any economic benefits available in
the form of refunds from the plans or reductions in future
contributions to the plans.

A liability for a termination benefit is recognised at the
earlier of when the entity can no longer withdraw the offer
of the termination benefit and when the entity recognises
any related restructuring costs.

1.B.6.2 Short-term and other long-term employee
benefits

A liability is recognised for benefits accruing to
employees in respect of salaries, wages and other
short-term employee benefits in the period the related
service is rendered at the undiscounted amount of the
benefits expected to be paid in exchange for that service.

Provision for leave benefits to employees is based on
actuarial valuation done by projected accrued benefit
method at the reporting date.

I.B.7. Taxation

Income tax expense represents the sum of the tax
currently payable and deferred tax.

1.B.7.1 Current tax

The income tax expense or credit for the period is the
tax payable on the current period''s taxable income
based on the applicable income tax rate for each
jurisdiction adjusted by changes in deferred tax assets
and liabilities attributable to temporary differences and
to unused tax losses.

The current income tax charge is calculated on the
basis of the tax laws enacted or substantively enacted
at the end of the reporting period in the countries where
the company and its joint operation operates and
generates taxable income. Management periodically
evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject
to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid
to the tax authorities.

1.B.7.2 Deferred tax

Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts
in the standalone financial statements. However, deferred
tax liabilities are not recognized if they arise from the
initial recognition of goodwill. Deferred income tax is also
not accounted for if it arises from initial recognition of an
asset or liability in a transaction other than a business
combination that at the time of the transaction affects
neither accounting profit nor taxable profit (tax loss).
Deferred income tax is determined using tax rates (and
laws) that have been enacted or substantially enacted by
the end of the reporting period and are expected to apply
when the related deferred income tax is realised or the
deferred income tax liability is settled.

Deferred tax assets are recognized for all deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.

Deferred tax liabilities are not recognized for temporary
differences between the carrying amount and tax
bases of investments in branches and interest in joint
arrangements where the Company is able to control the
timing of the reversal of the temporary differences and
it is probable that the differences will not reverse in the
foreseeable future.

Deferred tax assets are not recognized for temporary
differences between the carrying amount and tax
bases of investments in branches and interest in
joint arrangements where it is not probable that the
differences will reverse in the foreseeable future and
taxable profit will not be available against which the
temporary difference can be utilised.

Deferred tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate
to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle on
a net basis, or to realise the asset and settle the liability
simultaneously.

Management periodically evaluates positions taken in
tax returns with respect to situations in which applicable
tax regulation is subject to interpretation and considers
whether it is probable that the taxation authority will
accept tax position taken by the Company. Uncertain tax
positions are reflected in the overall measurement of
the Company''s tax expense and are based on the
most likely amount or the expected value arrived at by
the Company which provides a better prediction of the
resolution of uncertainty. Uncertain tax positions are
monitored and updated as and when new information
becomes available, typically upon examination or action
by the taxing authorities or through statute expiration
and judicial precedent. The Company considers whether
a particular amount payable or receivable for interest
and penalties is an income tax, in which case Ind AS
12 is applied to that amount. When an amount payable
for interest and penalties is determined to be within the
scope of Ind AS 37, it is presented as part of financing
cost or other expenses, respectively unless when there is
an overall settlement with tax authority and the interest

and penalties cannot be identified separately in which
case it is determined to be part of income taxes.

1.B.7.3 Current and deferred tax for the year

Current and deferred tax are recognised in profit or loss,
except when they relate to items that are recognised
in other comprehensive income or directly in equity,
in which case, the current and deferred tax are also
recognised in other comprehensive income or directly
in equity respectively. Where current tax or deferred
tax arises from the initial accounting for a business
combination, the tax effect is included in the accounting
for the business combination.

.B.8 Property, plant and equipment

Property, plant and equipment are carried at cost less
accumulated depreciation and impairment losses, if any.
The cost of property, plant and equipment comprises its
purchase price net of any trade discounts and rebates,
any import duties and other taxes (other than those
subsequently recoverable from the tax authorities), any
directly attributable expenditure on making the asset
ready for its intended use, other incidental expenses
and interest on borrowings attributable to acquisition of
qualifying fixed assets up to the date the asset is ready
for its intended use. It also includes initial estimate of the
costs of dismantling and removing the item and restoring
the site on which it is located. Replacement cost of an
item of property, plant and equipment is capitalised if
replacement meets the recognition criteria.

Carrying amount of items replaced is derecognised.
Cost of major inspections is recognised in the
carrying amount of property, plant and equipment as
a replacement, if recognition criteria are satisfied and
any remaining carrying amount of the cost of previous
inspection is derecognised. Machinery spares which can
be used only in connection with an item of fixed asset and
whose use is expected to be irregular are capitalised (if
they meet the asset recognition criteria) and depreciated
over the useful life of the principal item of the relevant
assets. Depreciation is recognised using straight-line
method so as to write off the cost of the assets (other
than freehold land and capital work-in-progress) less
their residual values over their useful life specified in
Schedule II to the Act, or in case of assets where the
useful life was determined by technical evaluation, over
the useful life so determined. Subsequent expenditure
on property, plant and equipment after its purchase /
completion is capitalised only if such expenditure results
in an increase in the future benefits from such asset
beyond its previously assessed standard of performance.

Estimated useful lives of the assets are as follows:
Buildings - 60 years

Furniture and fixtures - 10 years

Vehicles - 8 - 9 years

Office equipment - 5 years

Freehold land is not depreciated

For following assets estimated useful life is different than
the useful life prescribed in schedule II to the Companies
Act, 2013 and has been assessed on technical advice,
taking into account the nature of the asset, the
estimated usage of the asset, the operating conditions
of the asset, past history of replacement, anticipated
technological changes, manufacturers warranties and
maintenance support, etc.

Plant & Equipment (except Tunnel Boring Machines),
Concreting, Crushing, Piling, Road making, Laboratory &
Welding Equipment, Floating Equipment - 20 Years.

Tunnel Boring Machines - Length of the tunnel bored
over life of the construction project for where it is used.

Cost of shuttering materials, issued to jobs, is charged
off equally over a period of four years.

An item of property, plant and equipment is derecognised
upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset.
Any gain or loss arising on the disposal or retirement of
an item of property, plant and equipment is determined
as the difference between the sales proceeds and
the carrying amount of the asset and is recognised in
profit or loss.

1.B.8.1 Capital work-in-progress

Property, plant and equipment that are not yet ready for
their intended use are carried at cost, comprising direct
cost, related incidental expenses and attributable interest.

.B.9 Intangible assets

Intangible assets with finite useful lives that are
acquired separately are carried at cost less accumulated
amortisation and accumulated impairment losses.
Amortisation is recognised on a straight-line basis over
their estimated useful lives. The estimated useful life
and amortisation method are reviewed at the end of
each reporting period, with the effect of any changes in
estimate being accounted for on a prospective basis.
Intangible assets with indefinite useful lives that are
acquired separately are carried at cost less accumulated
impairment losses. Useful life is as below:

Computer software - 5 years

An intangible asset is derecognised on disposal, or
when no future economic benefits are expected from
use or disposal. Gains or losses from derecognition of
an intangible asset, measured at the difference between
the net disposal proceeds and the carrying amount of
the asset is recognised in profit or loss when the asset
is derecognised.

1.B. 10 Impairment of tangible and intangible assets other
than goodwill

At the end of each reporting period, the Company reviews
the carrying amounts of its tangible and intangible
assets to determine whether there is any indication
that those assets have suffered an impairment loss.
If any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent
of the impairment loss (if any). When 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.
When a reasonable and consistent basis of allocation
can be identified, corporate assets are also allocated to
individual cash-generating units, or otherwise they are
allocated to the smallest Company of cash-generating
units for which a reasonable and consistent allocation
basis can be identified.

Recoverable amount is the higher of fair value less costs
of disposal and value in use. In assessing value in use,
the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects
current market assessments of the time value of money
and the risks specific to the asset for which the estimates
of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating
unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit)
is reduced to its recoverable amount. An impairment
loss is recognised immediately in profit or loss, unless
the relevant asset is carried at a revalued amount,
in which case the impairment loss is treated as a
revaluation decrease.

When an impairment loss subsequently reverses, the
carrying amount of the asset (or a cash-generating unit)
is increased to the revised estimate of its recoverable
amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been
determined had no impairment loss been recognised
for the asset (or cash-generating unit) in prior years.
A reversal of an impairment loss is recognised
immediately in profit or loss.

1.B.11 Inventories

Inventories are stated at the lower of cost and net
realisable value. Net realisable value represents the
estimated selling price for inventories less all estimated
costs of completion and costs necessary to make
the sale. Cost is determined on the basis of weighted
average method.

Mar 31, 2025

NOTE-1: GENERAL INFORMATION

Afcons Infrastructure Limited (the "Company" or "Afcons") is a limited company incorporated in India. Shapoorji PallonjiÂ and Company Private Limited was the Parent CompanyÂ upto 12^thÂ January, 2024. Upon conversion of convertibleÂ preference shares, Goswami Infratech Private Limited hasÂ become the Parent Company w.e.f 13^thÂ January, 2024 tillÂ 03^rdÂ November 2024. On 4^thÂ November 2024, Company hasÂ completed Initial Public Offering (IPO), pursuant to which itsÂ equity shares were listed on National Stock Exchange (NSE)Â and Bombay Stock Exchange (BSE). During the year, theÂ Company got listed on stock exchange.

The address of its registered office is "Afcons House", 16 Shah Industrial Estate, Veera Desai Road, Andheri (West),Â Mumbai 400 053 and principal place of business is Mumbai,Â India. The principal activity of the Company and its jointÂ operations (the "Company") are infrastructure activities.Â Afcons has a presence in almost the entire spectrum ofÂ infrastructure activities in India and overseas. The CompanyÂ is engaged in marine works, highways, bridges, metro works,Â power houses, tunnels, oil and gas, LNG tanks and otherÂ general civil engineering projects both in India and Africa andÂ Mideast countries.

A. Basis of preparation and presentation

i) Â Â Â Compliance with Ind AS

The standalone financial statements of Afcons Infrastructure Limited ("The Company" or "Afcons")Â has been prepared in accordance with the IndianÂ Accounting Standard ('Ind ASâ) notified under sectionÂ 133 of the Companies Act, 2013 read with CompaniesÂ (Indian Accounting Standards) Rules, 2015 and relevantÂ amendment rules issued thereafter.

ii) Â Â Â Historical cost convention

The standalone financial statements have been prepared on the historical cost basis except for certainÂ financial instruments that are measured at fair valuesÂ at the end of each reporting year, as explained in theÂ accounting policies below.

Historical cost is generally based on the fair value of the consideration given in exchange for goods andÂ services.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionÂ between market participants at the measurement date,Â regardless of whether that price is directly observableÂ or estimated using another valuation technique. InÂ estimating the fair value of an asset or a liability, theÂ Company takes into account the characteristics ofÂ the asset or liability if market participants would take

those characteristics into account when pricing the asset or liability at the measurement date. Fair valueÂ for measurement and/or disclosure purposes in theseÂ standalone financial statements is determined on suchÂ a basis, except for leasing transactions that are withinÂ the scope of Ind AS 116, and measurements that haveÂ some similarities to fair value but are not fair value,Â such as net realisable value in Ind AS 2 or value in useÂ in Ind AS 36.

In addition, for standalone financial reporting purposes, fair value measurements are categorised into LevelÂ 1, 2 or 3 based on the degree to which the inputs toÂ the fair value measurements are observable and theÂ significance of the inputs to the fair value measurementÂ in its entirety, which are described as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entityÂ can access at the measurement date;

Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for theÂ asset or liability, either directly or indirectly; and

Level 3 inputs are unobservable inputs for the asset or liability.

iii) Operating cycle

The standalone balance sheet presents current and non-current assets, and current and non-currentÂ liabilities, as separate classifications. For this purpose,Â an asset is classified as current if:

â¢ Â Â Â It is held primarily for the purpose of trading; or

â¢ Â Â Â It is expected to realise the asset within 12 monthsÂ after the reporting period; or

â¢ Â Â Â The asset is a cash or equivalent unless it isÂ restricted from being exchanged or used to settleÂ liability for at least 12 months after the reportingÂ period.

All other assets are classified as non-current.

Similarly, a liability is classified as current if:

â¢ Â Â Â It is held primarily for the purpose of trading; or

â¢ Â Â Â It is due to be settled within 12 months after theÂ reporting period; or

â¢ Â Â Â The Company does not have an unconditionalÂ right to defer the settlement of the liability for atÂ least 12 months after the reporting period. TermsÂ of a liability that could result in its settlement byÂ the issue of equity instruments at the option of theÂ counterparty does not affect this classification.

All other liabilities are classified as non-current.

B. Material accounting policiesÂ Goodwill

Goodwill represents the cost of acquired business as established at the date of acquisition of the business inÂ excess of the acquirer's interest in the net fair value of theÂ identifiable assets, liabilities and contingent liabilities lessÂ accumulated impairment losses, if any. Goodwill is testedÂ for impairment annually or when events or circumstancesÂ indicate that the implied fair value of goodwill is less than itsÂ carrying amount.

For the purposes of impairment testing, goodwill is allocated to each of the Company's cash-generating units (or groupsÂ of cash-generating units) that is expected to benefit fromÂ the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently whenÂ there is an indication that the unit may be impaired. If theÂ recoverable amount of the cash-generating unit is less thanÂ its carrying amount, the impairment loss is allocated firstÂ to reduce the carrying amount of any goodwill allocatedÂ to the unit and then to the other assets of the unit pro rataÂ based on the carrying amount of each asset in the unit. AnyÂ impairment loss for goodwill is recognised directly in profitÂ or loss. An impairment loss recognised for goodwill is notÂ reversed in subsequent periods.

On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in theÂ determination of the profit or loss on disposal.

I.B.2. a) Interests in Joint Operations

Company enters into Joint Venture arrangement with other parties for execution of construction arrangements for whichÂ an unincorporated vehicle is formed having an independentÂ legal status for the tax purpose i.e. Association of person/Â Body of individual etc. Such arrangement (also called asÂ joint operations) is considered as extension of business, ifÂ in accordance with the terms of the arrangement, CompanyÂ acts as a principal and remains solely liable for the executingÂ the entire project on its own, funding or contributingÂ assets and is also responsible for all the liabilities in theÂ unincorporated vehicle. Accordingly, all the assets, liabilities,Â revenue and expenses pertaining to such unincorporatedÂ vehicle is consolidated in the separate financial statementsÂ of the Company.

Similarly, in case the Company is acting as an agent in such kind of arrangements, where the other party to theÂ arrangement is solely liable for the executing the entireÂ project on its own, funding or contributing assets and isÂ also responsible for all the liabilities in the unincorporatedÂ vehicle. Accordingly, the Company recognises its share

of profits/fees as determined in the arrangement in the separate financial statements of the Company.

1.B.2. b) Interest in unincorporated Joint ventures

When the Company enters into a joint venture (JV) arrangement with other parties and an unincorporatedÂ vehicle is formed which has a separate status for taxÂ purposes (i.e. Association of person/Body of individual etc.)Â and if as per the terms of agreement, the Company remainsÂ liable for all the liabilities of the unincorporated vehicle andÂ is also responsible for funding or contributing assets toÂ the unincorporated vehicle for construction activity, thisÂ unincorporated vehicle (also considered and called asÂ joint operation) has been considered as an extension ofÂ the Company from accounting point of view and assets,Â liabilities, revenue and expenses are consolidated on theÂ basis of its share in the operations in the separate financialÂ statement of the Company.

1.B.3. Revenue recognition Sale of goods

Revenue from sale of goods is recognised upon satisfaction of performance obligations, i.e. at a point of time, whichÂ occurs when the control is transferred to the customer.Â Customers obtain control as per the incoterms. InvoicesÂ are issued according to contractual terms and are usuallyÂ payable as per the credit period agreed with the customer.

Rendering of services:

Revenue from providing services is recognised in the accounting period in which the services are rendered.

Invoices are issued according to contractual terms and are usually payable as per the credit period agreed with theÂ customer.

Construction contracts:

The Company recognises revenue from engineering, procurement and construction contracts ('EPC') over theÂ period of time, as performance obligations are satisfied overÂ time due to continuous transfer of control to the customer.Â EPC contracts are generally accounted for as a singleÂ performance obligation as it involves complex integration ofÂ goods and services.

The performance obligations are satisfied over time as the work progresses. The Company recognises revenue usingÂ input method (i.e. percentage-of-completion method),Â based primarily on contract cost incurred to date comparedÂ to total estimated contract costs. Changes to total estimatedÂ contract costs, if any, are recognised in the period in whichÂ they are determined as assessed at the contract level. IfÂ the consideration in the contract includes price variation

clause or there are amendments in contracts, the Company estimates the amount of consideration to which it will beÂ entitled in exchange for work performed.

Due to the nature of the work required to be performed on the performance obligations, the estimation of total revenue andÂ cost at completion is complex, subject to many variables andÂ requires significant judgement. Variability in the transactionÂ price arises primarily due to liquidated damages, priceÂ variation clauses, changes in scope, incentives, discounts,Â if any. The Company considers its experience with similarÂ transactions and expectations regarding the contract inÂ estimating the amount of variable consideration to whichÂ it will be entitled and determining whether the estimatedÂ variable consideration should be constrained. The CompanyÂ includes estimated amounts in the transaction price to theÂ extent it is probable that a significant reversal of cumulativeÂ revenue recognised will not occur when the uncertaintyÂ associated with the variable consideration is resolved. TheÂ estimates of variable consideration are based largely on anÂ assessment of anticipated performance and all informationÂ (historical, current and forecasted) that is reasonablyÂ available. Various agreements are entered with customersÂ wherein the Group pays a certain portion of the financeÂ cost to the funding agencies of the project. In practice,Â these payments are considered as payment on behalf ofÂ the customer. These payments are not related to a distinctÂ service or product by customer. An estimated amount toÂ be paid over the lifecycle of the project is calculated andÂ accordingly the same is accounted for as a reduction ofÂ contract revenue.

Progress billings are generally issued upon completion of certain phases of the work as stipulated in the contract.Â Billing terms of the over-time contracts vary but are generallyÂ based on achieving specified milestones. The differenceÂ between the timing of revenue recognised and customerÂ billings result in changes to contract assets and contractÂ liabilities. Payment is generally due upon receipt of theÂ invoice, payable within 90 days or less. Contractual retentionÂ amounts billed to the customers are generally due uponÂ expiration of the contract period or any other conditions asÂ mentioned in the contract.

The contracts generally result in revenue recognised in excess of billings which are presented as contract assetsÂ on the statement of financial position. Amounts billed andÂ due from customers are classified as receivables on theÂ statement of financial position. The portion of the paymentsÂ retained by the customer until final contract settlement isÂ not considered a significant financing component since it isÂ usually intended to provide customer with a form of securityÂ for Companyâs remaining performance as specified under

the contract, which is consistent with the industry practice. Contract liabilities represent amounts billed to customers inÂ excess of revenue recognised till date. A liability is recognisedÂ for advance payments and it is not considered as a significantÂ financing component since it is used to meet working capitalÂ requirements at the time of project mobilisation stage. TheÂ same is presented as contract liability in the statement ofÂ financial position. Amounts received before the related workÂ is performed are disclosed in the Balance Sheet as contractÂ liability and termed as "Advances from customer".

Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change. AnyÂ resulting increases or decreases in estimated revenues orÂ costs are reflected in profit or loss in the period in which theÂ circumstances that give rise to the revision become knownÂ by management.

For construction contracts the control is transferred over time and revenue is recognised based on the extent of progressÂ towards completion of the performance obligations. When itÂ is probable that total contract costs will exceed total contractÂ revenue, the expected loss is recognised as an expenseÂ immediately. The percentage of completion is basedÂ primarily on contract cost incurred to date compared to totalÂ estimated contract cost for each contract in order to reflectÂ the effective completion of the project. This percentage ofÂ completion could be based on technical milestones or asÂ per the contractual terms specified. A construction contractÂ is considered completed when the last technical milestoneÂ is achieved, which occurs upon contractual transfer ofÂ ownership of the asset.

Dividend and interest income

Dividend income from investments is recognised when the shareholderâs right to receive payment has been establishedÂ (provided that it is probable that the economic benefits willÂ flow to the Company and the amount of income can beÂ measured reliably).

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to theÂ Company and the amount of income can be measuredÂ reliably. Interest income is accrued on a time basis, byÂ reference to the principal outstanding and at the effectiveÂ interest rate applicable, which is the rate that exactlyÂ discounts estimated future cash receipts through theÂ expected life of the financial asset to that assetâs net carryingÂ amount on initial recognition.

Other operating income

Income from export incentives is recognised on cash basis to the extent the ultimate realisation is reasonably certain.

I.B.4. Foreign currencies

(i) Functional and presentation currency

Items included in the standalone financial statements of each of the Companyâs entities are measured usingÂ the currency of the primary economic environment inÂ which the entity operates ('the functional currencyâ).Â The standalone financial statement is presented inÂ Indian Rupee ('), which is Companyâs functional andÂ presentation currency. For each entity (branches andÂ Joint Operations), the Group determines the functionalÂ currency and items included in the financial statementsÂ of each entity are measured using that functionalÂ currency.

In preparing these Standalone financial statements, the Group has applied following policies:

A) Â Â Â Foreign Branches of the Company (outside IndiaÂ with functional currency other than presentationÂ currency): -

1. Â Â Â Income and expense items are translatedÂ at the exchange rates at the dates of theÂ transactions and all resulting exchangeÂ differences are recognised in the StandaloneÂ Statement of Profit and Loss.

2. Â Â Â Non-monetary assets and liabilities areÂ measured in terms of historical cost in foreignÂ currencies and are not translated at the ratesÂ prevailing at the reporting period. MonetaryÂ assets and liabilities are translated at theÂ rates prevailing at the end of each reportingÂ period. Exchange differences on translationsÂ are recognised in the Standalone StatementÂ of Profit and Loss.

B) Â Â Â Joint Operations and subsidiaries outside IndiaÂ with functional currency other than presentationÂ currency:

1. Â Â Â Assets and liabilities, both monetary andÂ non-monetary are translated at the ratesÂ prevailing at the end of each reporting year.

2. Â Â Â Income and expense items are translated atÂ the average exchange rates for the period,Â unless exchange rates fluctuate significantlyÂ during that period, in which case the exchangeÂ rates at the dates of the transactions areÂ used. Exchange differences arising, if any, areÂ recognised in other comprehensive incomeÂ and accumulated in equity (and attributed toÂ non-controlling interests as appropriate).

(ii) Foreign currency transactions and balances

In preparing the standalone financial statements of each individual Company entity, transactions inÂ currencies other than the entityâs functional currencyÂ (foreign currencies) are recognised at the rates ofÂ exchange prevailing at the dates of the transactions.Â At the end of each reporting period, monetary itemsÂ denominated in foreign currencies are retranslated atÂ the rates prevailing at that date. Non-monetary itemsÂ carried at fair value that are denominated in foreignÂ currencies are retranslated at the rates prevailing atÂ the date when the fair value was determined. Nonmonetary items that are measured in terms of historicalÂ cost in a foreign currency are not retranslated.

Exchange differences on monetary items are recognised in Statement of Profit and Loss in the period in whichÂ they arise except for:

â¢ Â Â Â Exchange differences on transactions entered intoÂ in order to hedge certain foreign currency risks;Â and

â¢ Â Â Â Exchange differences on monetary itemsÂ receivable from or payable to a foreign operationÂ for which settlement is neither planned norÂ likely to occur (therefore forming part of theÂ net investment in the foreign operation), whichÂ are recognised initially in other comprehensiveÂ income and reclassified from equity to profit orÂ loss on repayment of the monetary items.

On the disposal of a foreign operation (i.e. a disposal of the Companyâs entire interest in a foreign operation,Â a disposal involving loss of control over a foreignÂ operation, or a partial disposal of an interest in a foreignÂ operation of which the retained interest becomesÂ a financial asset), all of the exchange differencesÂ accumulated in equity in respect of that operationÂ attributable to the owners of the Company areÂ reclassified to profit or loss.

In addition, in relation to a partial disposal of a foreign operation that does not result in the Company losingÂ control over the foreign operation, the proportionateÂ share of accumulated exchange differences is reattributed to non-controlling interests and are notÂ recognised in profit or loss. For all other partialÂ disposals (i.e. partial disposals of associates or jointÂ arrangements that do not result in the Company losingÂ significant influence or joint control), the proportionateÂ share of the accumulated exchange differences isÂ reclassified to profit or loss.

Goodwill and fair value adjustments to identifiable assets acquired and liabilities assumed throughÂ acquisition of a foreign operation are treated as assetsÂ and liabilities of the foreign operation and translatedÂ at the rate of exchange prevailing at the end of eachÂ reporting period. Exchange differences on such itemsÂ are recognised in other comprehensive income.

I.B.5. Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which areÂ assets that necessarily take a substantial period of timeÂ to get ready for their intended use or sale, are added toÂ the cost of those assets, until such time as the assets areÂ substantially ready for their intended use or sale.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifyingÂ assets is deducted from the borrowing costs eligible forÂ capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

I.B.6. Employee benefits1.B.6.1 Retirement benefit costs and termination benefits

Employee benefits include provident fund, superannuation fund, employee state insurance scheme, gratuity fund,Â compensated absences and leave encashment.

Payments to defined contribution retirement benefit plans are recognised as an expense when employees haveÂ rendered service entitling them to the contributions.

The liability or asset recognised in the balance sheet in respect of defined benefit plan is the present value of theÂ defined benefit obligation at the end of the reporting periodÂ less fair value of plan assets.

For defined retirement benefit plans, the cost of providing benefits is determined using the Projected Unit CreditÂ Method, with actuarial valuations being carried out at theÂ end of each annual reporting period. Re-measurement,Â comprising actuarial gains and losses, the effect of theÂ changes to the asset ceiling (if applicable) and the return onÂ plan assets (excluding net interest), is reflected immediatelyÂ in the balance sheet with a charge or credit recognised inÂ other comprehensive income in the period in which theyÂ occur. Remeasurement recognised in other comprehensiveÂ income is reflected immediately in retained earnings andÂ is not reclassified to profit or loss. Past service cost isÂ recognised in profit or loss in the period of a plan amendment.Â Net interest is calculated by applying the discount rate at theÂ beginning of the period to the net defined benefit liability orÂ asset.

Defined benefit costs are categorised as follows:

â¢ Â Â Â Service cost (including current service cost, past serviceÂ cost, as well as gains and losses on curtailments andÂ settlements);

â¢ Â Â Â Net interest expense or income; and

â¢ Â Â Â Re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item 'EmployeeÂ benefits expenseâ. Curtailment gains and losses areÂ accounted for as past service costs.

The present value of the defined benefit plan liability is calculated using a discount rate which is determined byÂ reference to market yields at the end of the reporting periodÂ on government bonds.

The retirement benefit obligation recognised in the standalone financial statements represents the actualÂ deficit or surplus in the Companyâs defined benefit plans.Â Any surplus resulting from this calculation is limited toÂ the present value of any economic benefits available inÂ the form of refunds from the plans or reductions in futureÂ contributions to the plans.

A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of theÂ termination benefit and when the entity recognises anyÂ related restructuring costs.

1.B.6.2 Short-term and other long-term employee benefits

A liability is recognised for benefits accruing to employees in respect of salaries, wages and other short-term employeeÂ benefits in the period the related service is rendered at theÂ undiscounted amount of the benefits expected to be paid inÂ exchange for that service.

Provision for leave benefits to employees is based on actuarial valuation done by projected accrued benefitÂ method at the reporting date.

I.B.7. Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

1.B.7.1 Current tax

The income tax expense or credit for the period is the tax payable on the current periodâs taxable income based on theÂ applicable income tax rate for each jurisdiction adjusted byÂ changes in deferred tax assets and liabilities attributable toÂ temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the endÂ of the reporting period in the countries where the Company

and its joint operation operates and generates taxable income. Management periodically evaluates positions takenÂ in tax returns with respect to situations in which applicableÂ tax regulation is subject to interpretation. It establishesÂ provisions where appropriate on the basis of amountsÂ expected to be paid to the tax authorities.

1.B.7.2 Deferred tax

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the taxÂ bases of assets and liabilities and their carrying amountsÂ in the standalone financial statements. However, deferredÂ tax liabilities are not recognised if they arise from the initialÂ recognition of goodwill. Deferred income tax is also notÂ accounted for if it arises from initial recognition of an assetÂ or liability in a transaction other than a business combinationÂ that at the time of the transaction affects neither accountingÂ profit nor taxable profit (tax loss). Deferred income taxÂ is determined using tax rates (and laws) that have beenÂ enacted or substantially enacted by the end of the reportingÂ period and are expected to apply when the related deferredÂ income tax is realised or the deferred income tax liability isÂ settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it isÂ probable that future taxable amounts will be available toÂ utilise those temporary differences and losses.

Deferred tax liabilities are not recognised for temporary differences between the carrying amount and tax bases ofÂ investments in branches and interest in joint arrangementsÂ where the Company is able to control the timing of theÂ reversal of the temporary differences and it is probable thatÂ the differences will not reverse in the foreseeable future.

Deferred tax assets are not recognised for temporary differences between the carrying amount and tax bases ofÂ investments in branches and interest in joint arrangementsÂ where it is not probable that the differences will reverse inÂ the foreseeable future and taxable profit will not be availableÂ against which the temporary difference can be utilised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets andÂ liabilities and when the deferred tax balances relate to theÂ same taxation authority. Current tax assets and tax liabilitiesÂ are offset where the entity has a legally enforceable right toÂ offset and intends either to settle on a net basis, or to realiseÂ the asset and settle the liability simultaneously.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicableÂ tax regulation is subject to interpretation and considersÂ whether it is probable that the taxation authority will accept

tax position taken by the Group. Uncertain tax positions are reflected in the overall measurement of the Groupâs taxÂ expense and are based on the most likely amount or theÂ expected value arrived at by the Group which provides aÂ better prediction of the resolution of uncertainty. UncertainÂ tax positions are monitored and updated as and when newÂ information becomes available, typically upon examinationÂ or action by the taxing authorities or through statuteÂ expiration and judicial precedent. The Group considersÂ whether a particular amount payable or receivable forÂ interest and penalties is an income tax, in which case Ind ASÂ 12 is applied to that amount. When an amount payable forÂ interest and penalties is determined to be within the scopeÂ of Ind AS 37, it is presented as part of financing cost orÂ other expenses, respectively unless when there is an overallÂ settlement with tax authority and the interest and penaltiesÂ cannot be identified separately in which case it is determinedÂ to be part of income taxes.

1.B.7.3 Current and deferred tax for the year

Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in otherÂ comprehensive income or directly in equity, in which case,Â the current and deferred tax are also recognised in otherÂ comprehensive income or directly in equity respectively.Â Where current tax or deferred tax arises from the initialÂ accounting for a business combination, the tax effect isÂ included in the accounting for the business combination.

1.B.8 Property, plant and equipment

Property, plant and equipment are carried at cost less accumulated depreciation and impairment losses, if any.Â The cost of property, plant and equipment comprises itsÂ purchase price net of any trade discounts and rebates,Â any import duties and other taxes (other than thoseÂ subsequently recoverable from the tax authorities), anyÂ directly attributable expenditure on making the asset readyÂ for its intended use, other incidental expenses and interestÂ on borrowings attributable to acquisition of qualifying fixedÂ assets up to the date the asset is ready for its intended use.Â It also includes initial estimate of the costs of dismantlingÂ and removing the item and restoring the site on which itÂ is located. Replacement cost of an item of property, plantÂ and equipment is capitalised if replacement meets theÂ recognition criteria.

Carrying amount of items replaced is derecognised. Cost of major inspections is recognised in the carrying amountÂ of property, plant and equipment as a replacement, ifÂ recognition criteria are satisfied and any remaining carryingÂ amount of the cost of previous inspection is derecognised.Â Machinery spares which can be used only in connectionÂ with an item of fixed asset and whose use is expected to beÂ irregular are capitalised (if they meet the asset recognitionÂ criteria) and depreciated over the useful life of the principalÂ item of the relevant assets. Depreciation is recognised usingÂ straight-line method so as to write off the cost of the assetsÂ (other than freehold land and capital work-in-progress)Â less their residual values over their useful life specified inÂ Schedule II to the Act, or in case of assets where the usefulÂ life was determined by technical evaluation, over the usefulÂ life so determined. Subsequent expenditure on property,Â plant and equipment after its purchase / completion isÂ capitalised only if such expenditure results in an increaseÂ in the future benefits from such asset beyond its previouslyÂ assessed standard of performance.

Estimated useful lives of the assets are as follows:

Buildings Â Â Â -Â Â Â Â 60 years

Furniture and fixtures Â Â Â -Â Â Â Â 10 years

Vehicles Â Â Â -Â Â Â Â 8-9 years

Office equipment Â Â Â -Â Â Â Â 5 years

Freehold land is not depreciated

For following assets estimated useful life is different than the useful life prescribed in schedule II to the CompaniesÂ Act, 2013 and has been assessed on technical advice, takingÂ into account the nature of the asset, the estimated usageÂ of the asset, the operating conditions of the asset, pastÂ history of replacement, anticipated technological changes,Â manufacturers warranties and maintenance support, etc.

Plant & Equipment (except Tunnel Boring Machines), Concreting, Crushing, Piling, Road making, Laboratory &Â Welding Equipment, Floating Equipment - 20 Years.

Tunnel Boring Machines - Length of the tunnel bored over life of the construction project for where it is used.

Cost of shuttering materials, issued to jobs, is charged off equally over a period of four years.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits areÂ expected to arise from the continued use of the asset.Â Any gain or loss arising on the disposal or retirement ofÂ an item of property, plant and equipment is determined asÂ the difference between the sales proceeds and the carryingÂ amount of the asset and is recognised in profit or loss.

l.B.8.1 Capital work-in-progress

Property, plant and equipment that are not yet ready for their intended use are carried at cost, comprising direct cost,Â related incidental expenses and attributable interest.

1.B.9 Intangible assets

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation

and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimatedÂ useful lives. The estimated useful life and amortisationÂ method are reviewed at the end of each reporting period,Â with the effect of any changes in estimate being accountedÂ for on a prospective basis. Intangible assets with indefiniteÂ useful lives that are acquired separately are carried at costÂ less accumulated impairment losses. Useful life is as below:

Computer software - 5 years

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use orÂ disposal. Gains or losses from derecognition of an intangibleÂ asset, measured at the difference between the net disposalÂ proceeds and the carrying amount of the asset is recognisedÂ in profit or loss when the asset is derecognised.

1.B.10 Impairment of tangible and intangible assets other than goodwill

At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets toÂ determine whether there is any indication that those assetsÂ have suffered an impairment loss. If any such indicationÂ exists, the recoverable amount of the asset is estimatedÂ in order to determine the extent of the impairment loss (ifÂ any). When it is not possible to estimate the recoverableÂ amount of an individual asset, the Company estimates theÂ recoverable amount of the cash-generating unit to whichÂ the asset belongs. When a reasonable and consistent basisÂ of allocation can be identified, corporate assets are alsoÂ allocated to individual cash-generating units, or otherwiseÂ they are allocated to the smallest Company of cashgenerating units for which a reasonable and consistentÂ allocation basis can be identified.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, theÂ estimated future cash flows are discounted to their presentÂ value using a pre-tax discount rate that reflects currentÂ market assessments of the time value of money and theÂ risks specific to the asset for which the estimates of futureÂ cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, theÂ carrying amount of the asset (or cash-generating unit) isÂ reduced to its recoverable amount. An impairment loss isÂ recognised immediately in profit or loss, unless the relevantÂ asset is carried at a revalued amount, in which case theÂ impairment loss is treated as a revaluation decrease.

When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) isÂ increased to the revised estimate of its recoverable amount,

but so that the increased carrying amount does not exceed the carrying amount that would have been determined hadÂ no impairment loss been recognised for the asset (or cashgenerating unit) in prior years. A reversal of an impairmentÂ loss is recognised immediately in profit or loss.

1.B.11 Inventories

Inventories are stated at the lower of cost and net realisable value. Net realisable value represents the estimated sellingÂ price for inventories less all estimated costs of completionÂ and costs necessary to make the sale. Cost is determinedÂ on the basis of weighted average method.

1.B.12 Provisions and contingent liabilities

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event,Â it is probable that the Company will be required to settleÂ the obligation, and a reliable estimate can be made of theÂ amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligationÂ at the end of the reporting period, taking into account theÂ risks and uncertainties surrounding the obligation. WhenÂ a provision is measured using the cash flows estimatedÂ to settle the present obligation, its carrying amount is theÂ present value of those cash flows (when the effect of theÂ time value of money is material).

Present obligations arising under onerous contracts are recognised and measured as provisions. An onerousÂ contract is considered to exist where the Group has aÂ contract under which the unavoidable costs of meeting theÂ obligations under the contract exceed the economic benefitsÂ expected to be received under it.

A contingent liability is disclosed where there is a possible obligation or present obligations that may, but probablyÂ will not, require an outflow of resources. Contingent assetsÂ are not recognised. Information on contingent liabilities isÂ disclosed in the notes to standalone financial statementsÂ unless the possibility of an outflow of resources embodyingÂ economic benefits is remote.

1.B.13 Financial instruments

Financial assets and financial liabilities are recognised when a Company becomes a party to the contractual provisions ofÂ the instruments.

Initial Recognition

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributableÂ to the acquisition or issue of financial assets and financialÂ liabilities (other than financial assets and financial liabilitiesÂ at fair value through profit or loss) are adjusted in the carryingÂ amount of such financial assets and financial liabilities.Â Transaction costs directly attributable to the acquisition ofÂ financial assets or financial liabilities at fair value throughÂ profit or loss are recognised immediately in StandaloneÂ Statement of Profit and Loss.

1.B.14 Financial assets

Classification and subsequent measurement of financial assets

1.B.14.1 Classification of financial assets

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

â¢ Â Â Â those to be measured subsequently at fair value (eitherÂ through other comprehensive income, or through profitÂ or loss), and

â¢ Â Â Â those measured at amortised cost.

The classification is done depending upon the Companyâs business model for managing the financial assets andÂ the contractual terms of the cash flows. Classification forÂ investments made in debt instruments will depend on theÂ business model in which the investment is held. The GroupÂ reclassifies debt investments when and only when itsÂ business model for managing those assets changes.

1.B.14.2 Subsequent measurement Debt instruments

Subsequent measurement of debt instruments depends on the Companyâs business model for managing the asset andÂ the cash flow characteristics of the asset. There are threeÂ measurement categories into which the Company classifiesÂ its debt instruments:

Amortised cost:

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments ofÂ principal and interest are measured at amortised cost e.g.Â Debentures, Bonds etc. A gain or loss on a debt investmentÂ that is subsequently measured at amortised cost isÂ recognised in profit or loss when the asset is derecognisedÂ or impaired. Interest income from these financial assets isÂ included in interest income using the effective interest rateÂ method.

Fair value through other comprehensive income

Debt instruments that meet the following conditions are subsequently measured at fair value through otherÂ comprehensive income (except for debt instruments thatÂ are designated as at fair value through profit or loss on initialÂ recognition):

â¢ Â Â Â the asset is held within a business model whoseÂ objective is achieved both by collecting contractualÂ cash flows and selling financial assets; and

â¢ Â Â Â the contractual terms of the instrument give rise onÂ specified dates to cash flows that are solely paymentsÂ of principal and interest on the principal amountÂ outstanding.

Fair value through profit or loss

Assets that do not meet the criteria for amortised cost or fair value through OCI, are measured at fair value throughÂ profit or loss e.g. investments in mutual funds. A gain or lossÂ on a debt investment that is subsequently measured at fairÂ value through profit or loss is recognised in profit or loss andÂ presented net in the statement of profit and loss within otherÂ gains/(losses) in the period in which it arises.

Equity instruments

Investments in equity instruments at FVTPL

Investments in equity instruments are classified as at FVTPL, unless the Company irrevocably elects on initialÂ recognition to present subsequent changes in fair value inÂ other comprehensive income for equity instruments whichÂ are not held for trading.

Investments in equity instruments at FVTOCI

On initial recognition, the Company can make an irrevocable election (on an instrument-by-instrument basis) to presentÂ the subsequent changes in fair value in other comprehensiveÂ income. This election is not permitted if the equityÂ investment is held for trading. These elected investmentsÂ are initially measured at fair value plus transaction costs.Â Subsequently, they are measured at fair value with gains andÂ losses arising from changes in fair value recognised in otherÂ comprehensive income and accumulated in the reserve forÂ 'equity instruments through other comprehensive incomeâ.Â The cumulative gain or loss is not reclassified to profit orÂ loss on disposal of the investments.

1.B.14.3 Impairment of financial assets

The Company applies the expected credit loss model for recognising impairment loss on financial assets measuredÂ at amortised cost, lease receivables, trade receivables,Â contract assets, other contractual rights to receive cash orÂ other financial asset.

For trade receivables, the Company measures the loss allowance at an amount equal to lifetime expected creditÂ losses.

Further, for the purpose of measuring lifetime expected credit loss allowance for trade receivables and contract asset,Â the Company has used a practical expedient as permitted

under Ind AS 109. This expected credit loss allowance is computed based on a provision matrix which takes intoÂ account historical credit loss experience and adjusted forÂ forward-looking information. The Company assesses on aÂ forward-looking basis the expected credit losses associatedÂ with its assets carried at amortised cost and FVOCI debtÂ instruments. The impairment methodology applied dependsÂ on whether there has been a significant increase in creditÂ risk. Note 49.8 details how the group determines whetherÂ there has been a significant increase in credit risk.

1.B.14.4 Effective interest method

Income is recognised on an effective interest basis for debt instruments other than those financial assets classified asÂ FVTPL. Interest income is recognised in the Statement ofÂ Profit and Loss.

1.B.14.5 De-recognition of financial assets

A financial asset is derecognised only when Company has transferred the rights to receive cash flows from theÂ financial asset. Where the entity has transferred an asset, theÂ Company evaluates whether it has transferred substantiallyÂ all risks and rewards of ownership of the financial asset. InÂ such cases, the financial asset is derecognised.

On derecognition of a financial asset in its entirety, the difference between the assetâs carrying amount and theÂ sum of the consideration received and receivable and theÂ cumulative gain or loss that had been recognised in otherÂ comprehensive income and accumulated in equity isÂ recognised in profit or loss if such gain or loss would haveÂ otherwise been recognised in profit or loss on disposal ofÂ that financial asset.

1.B.15 Financial liabilities and equity instruments Classification as debt or equity

Debt and equity instruments issued by the Company are classified as either financial liabilities or as equityÂ in accordance with the substance of the contractualÂ arrangements and the definitions of a financial liability andÂ an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deductingÂ all of its liabilities. Equity instruments issued by a CompanyÂ are recognised at the proceeds received, net of direct issueÂ costs.

Repurchase of the Companyâs own equity instruments is recognised and deducted directly in equity. No gain or lossÂ is recognised in profit or loss on the purchase, sale, issue orÂ cancellation of the Companyâs own equity instruments.

1.B.15.1 Classification and subsequent measurement Financial liabilities are measured at amortised cost.

Financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortisedÂ cost using the effective interest method. The effectiveÂ interest method is a method of calculating the amortisedÂ cost of a financial liability and of allocating interest expenseÂ over the relevant period. The effective interest rate is theÂ rate that exactly discounts estimated future cash paymentsÂ (including all fees and points paid or received that form anÂ integral part of the effective interest rate, transaction costsÂ and other premiums or discounts) through the expectedÂ life of the financial liability, or (where appropriate) a shorterÂ period, to the net carrying amount on initial recognition.

1.B.15.2 De-recognition of financial liabilities

The Company derecognises financial liabilities when, and only when, the Companyâs obligations are discharged,Â cancelled, or have expired. An exchange with a lender of debtÂ instruments with substantially different terms is accountedÂ for as an extinguishment of the original financial liabilityÂ and the recognition of a new financial liability. Similarly, aÂ substantial modification of the terms of an existing financialÂ liability (whether or not attributable to the financial difficultyÂ of the debtor) is accounted for as an extinguishment of theÂ original financial liability and the recognition of a new financialÂ liability. The difference between the carrying amount of theÂ financial liability derecognised and the consideration paidÂ and payable is recognised in profit or loss.

1.B.15.3 Foreign exchange gains and losses

For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the endÂ of each reporting period, the foreign exchange gains andÂ losses are determined based on the amortised cost of theÂ instruments and are recognised in 'Other incomeâ as 'NetÂ foreign exchange gains/(losses)â.

1.B.16 Derivative financial instruments

The Company enters into derivative financial instruments viz. foreign exchange forward contracts, interest rate swapsÂ and cross currency swaps to manage its exposure to interestÂ rate, foreign exchange rate risks and commodity prices. TheÂ Company does not hold derivative financial instruments forÂ speculative purposes.

Derivatives are initially recognised at fair value at the date the derivative contracts are entered into and are subsequentlyÂ remeasured to their fair value at the end of each reportingÂ period. The resulting gain or loss is recognised in profit orÂ loss immediately.

1.B.17 Leases:

The Company as lessee:

Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leasedÂ asset is available for use by the Company. ContractsÂ may contain both lease and non-lease components. TheÂ Company has elected not to separate lease and non-leaseÂ components and instead accounts for these as a singleÂ lease component.

1) Â Â Â Lease Liabilities

Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilitiesÂ include the net present value of the lease payments.Â The lease payments include fixed payments (includingÂ in substance fixed payments) less any leaseÂ incentives receivable, variable lease payments thatÂ are initially measured using the index or a rate at theÂ commencement date, and amounts expected to be paidÂ under residual value guarantees. The lease paymentsÂ also include the exercise price of a purchase optionÂ reasonably certain to be exercised by the CompanyÂ and payments of penalties for terminating the lease,Â if the lease term reflects the Company exercising theÂ option to terminate. Variable lease payments that doÂ not depend on an index or a rate are recognised asÂ expenses in the period in which the event or conditionÂ that triggers the payment occurs. Lease payments toÂ be made under reasonably certain extension optionsÂ are also included in the measurement of the liability.Â The lease payments are discounted using the lesseeâsÂ incremental borrowing rate (since the interest rateÂ implicit in the lease cannot be easily determined).Â Incremental borrowing rate is the rate of interest thatÂ the Company would have to pay to borrow over aÂ similar term, and a similar security, the funds necessaryÂ to obtain an asset of a similar value to the right of-useÂ asset in a similar economic environment.

Lease payments are allocated between principal and finance cost. The finance cost is charged to profit orÂ loss over the lease period so as to produce a constantÂ periodic rate of interest on the remaining balance of theÂ liability for each period.

2) Â Â Â Right-of-use assets

Right-of-use assets are measured at cost comprising the amount of the initial measurement of lease liability,Â lease payments made before the commencement date,Â any initial direct costs and restorations costs.

Right-of-use assets are depreciated over the lease term on a straight-line basis. Right-of-use assets areÂ measured at cost, less any accumulated depreciationÂ and impairment losses, and adjusted for any remeasurement of lease liabilities.

Extension and termination options are included in many of the leases. In determining the lease term theÂ management considers all facts and circumstancesÂ that create an economic incentive to exercise anÂ extension option, or not exercise a termination option.

Deferred tax on the deductible temporary difference and taxable temporary differences in respect of carryingÂ value of right of use assets and lease liability and theirÂ respective tax bases are recognised on a net basis.

3) Short term leases and leases of low value assets

Payments associated with short-term leases of equipment and all leases of low-value assets areÂ recognised on a straight-line basis as an expense inÂ profit or loss. Short-term leases are leases with a leaseÂ term of 12 months or less. Low-value assets compriseÂ assets having value less thanÂ 'Â 350,000.

1.B.18 Securities Premium

(i) Â Â Â Securities premium includes the difference between theÂ face value of the equity shares and the considerationÂ received in respect of shares issued.

(ii) Â Â Â The issue expenses of securities which qualify as equityÂ instruments are written off against securities premium.

1.B.19 Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) for the year by the weighted average number of equityÂ shares outstanding during the year.

Ordinary shares to be issued upon conversion of a mandatorily convertible instrument are included in the calculation of basicÂ earnings per share from the date the contract is entered into.Â Diluted earnings per share is computed by dividing the profitÂ / (loss) for the year as adjusted for dividend, interest andÂ other charges to expense or income (net of any attributableÂ taxes) relating to the dilutive potential equity shares, by theÂ weighted average number of equity shares considered forÂ deriving basic earnings per share and the weighted averageÂ number of equity shares which could have been issuedÂ on the conversion of all dilutive potential equity shares.Â Potential equity shares are deemed to be dilutive only if theirÂ conversion to equity shares would decrease the net profitÂ per share from continuing ordinary operations. PotentialÂ dilutive equity shares are deemed to be converted as at theÂ beginning of the period, unless they have been issued at aÂ later date.

1.B.20 Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operatingÂ decision maker.

The board of directors of Afcons Infrastructure Limited assesses the financial performance and position of theÂ Company and makes strategic decisions. The board ofÂ directors, which has been identified as being the chiefÂ operating decision maker, consists of the key managerialÂ personnel and the directors who are in charge of theÂ corporate planning. Refer note 34 for segment information&nb

Mar 31, 2024

B. Material accounting policies

Goodwill

Goodwill represents the cost of acquired business as established at the date of acquisition of the business in excess of the acquirer''s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities less accumulated impairment losses, if any. Goodwill is tested for impairment annually or when events or circumstances indicate that the implied fair value of goodwill is less than its carrying amount.

For the purposes of impairment testing, goodwill is allocated to each of the Company''s cash-generating units (or groups of cashgenerating units) that is expected to benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.

On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

I.B.2. a) Interests in Jointly Controlled Operations

Company enters into Joint Venture arrangement with other parties for execution of construction arrangements for which an unincorporated vehicle is formed having an independent legal status for the tax purpose i.e. Association of person/Body of individual etc. Such arrangement (also called as jointly controlled operations) is considered as extension of business, if in accordance with the terms of the arrangement, Company acts as a principal and remains solely liable for the executing the entire project on its own, funding or contributing assets and is also responsible for all the liabilities in the unincorporated vehicle. Accordingly, all the assets, liabilities, revenue and expenses pertaining to such unincorporated vehicle is consolidated in the separate financial statements of the Company.

Similarly, in case the Company is acting as an agent in such kind of arrangements, where the other party to the arrangement is solely liable for the executing the entire project on its own, funding or contributing assets and is also responsible for all the liabilities in the unincorporated vehicle. Accordingly, the Company recognises its share of profits/fees as determined in the arrangement in the separate financial statements of the Company.

1.B.2. b) Interest in unincorporated Joint ventures

When the Company enters into a joint venture (JV) arrangement with other parties and an unincorporated vehicle is formed which has a separate status for tax purposes (i.e. Association of person/Body of individual etc.) and if as per the terms of agreement, the Company remains liable for all the liabilities of the unincorporated vehicle and is also responsible for funding or contributing assets to the unincorporated vehicle for construction activity, this unincorporated vehicle (also considered and called as jointly controlled operation) has been considered as an extension of the Company from accounting point of view and assets, liabilities, revenue and expenses are consolidated on the basis of its share in the operations in the separate financial statement of the Company.

1.B.3. Revenue recognition Sale of goods

Revenue from sale of goods is recognised upon satisfaction of performance obligations, i.e. at a point of time, which occurs when the control is transferred to the customer. Customers obtain control as per the incoterms. Invoices are issued according to contractual terms and are usually payable as per the credit period agreed with the customer.

Rendering of services:

Revenue from providing services is recognised in the accounting period in which the services are rendered.

Invoices are issued according to contractual terms and are usually payable as per the credit period agreed with the customer. Construction contracts:

The Company recognises revenue from engineering, procurement and construction contracts (âEPC'') over the period of time, as performance obligations are satisfied over time due to continuous transfer of control to the customer. EPC contracts are generally accounted for as a single performance obligation as it involves complex integration of goods and services.

The performance obligations are satisfied over time as the work progresses. The Company recognises revenue using input method (i.e. percentage-of-completion method), based primarily on contract cost incurred to date compared to total estimated contract costs. Changes to total estimated contract costs, if any, are recognised in the period in which they are determined as assessed at the contract level. If the consideration in the contract includes price variation clause or there are amendments in contracts, the Company estimates the amount of consideration to which it will be entitled in exchange for work performed.

Due to the nature of the work required to be performed on the performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. Variability in the transaction price arises primarily due to liquidated damages, price variation clauses, changes in scope, incentives, discounts, if any. The Company considers its experience with similar transactions and expectations regarding the contract in estimating the amount of variable consideration to which it will be entitled and determining whether the estimated variable consideration should be constrained. The Company includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognised will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration are based largely on an assessment of anticipated performance and all information (historical, current and forecasted) that is reasonably available. Various agreements are entered with customers wherein the Group pays a certain portion of the finance cost to the funding agencies of the project. In practice, these payments are considered as payment on behalf of the customer. These payments are not related to a distinct service or product by customer. An estimated amount to be paid over the lifecycle of the project is calculated and accordingly the same is accounted for as a reduction of contract revenue. Progress billings are generally issued upon completion of certain phases of the work as stipulated in the contract. Billing terms of the over-time contracts vary but are generally based on achieving specified milestones. The difference between the timing of revenue recognised and customer billings result in changes to contract assets and contract liabilities. Payment is generally due upon receipt of the invoice, payable within 90 days or less. Contractual retention amounts billed to the customers are generally due upon expiration of the contract period or any other conditions as mentioned in the contract.

The contracts generally result in revenue recognised in excess of billings which are presented as contract assets on the statement of financial position. Amounts billed and due from customers are classified as receivables on the statement of financial position. The portion of the payments retained by the customer until final contract settlement is not considered a significant financing component since it is usually intended to provide customer with a form of security for Company''s remaining performance as specified under the contract, which is consistent with the industry practice. Contract liabilities represent amounts billed to customers in excess of revenue recognised till date. A liability is recognised for advance payments and it is not considered as a significant financing component since it is used to meet working capital requirements at the time of project mobilization stage. The same is presented as contract liability in the statement of financial position. Amounts received before the related work is performed are disclosed in the Balance Sheet as contract liability and termed as âAdvances from customerâ.

Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change. Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management.

For construction contracts the control is transferred over time and revenue is recognised based on the extent of progress towards completion of the performance obligations. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately. The percentage of completion is based primarily on contract cost incurred to date compared to total estimated contract cost for each contract in order to reflect the effective completion of the project. This percentage of completion could be based on technical milestones or as per the contractual terms specified. A construction contract is considered completed when the last technical milestone is achieved, which occurs upon contractual transfer of ownership of the asset.

Dividend and interest income

Dividend income from investments is recognised when the shareholder''s right to receive payment has been established (provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably). Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition.

Other operating income

Income from export incentives is recognised on cash basis to the extent the ultimate realisation is reasonably certain.

I.B.4. Foreign currencies

(i) Functional and presentation currency

Items included in the standalone financial statements of each of the Company''s entities are measured using the currency of the primary economic environment in which the entity operates (âthe functional currency''). The standalone financial statement is presented in Indian Rupee (INR), which is Company''s functional and presentation currency. For each entity (branches and Jointly controlled operations), the Group determines the functional currency and items included in the financial statements of each entity are measured using that functional currency.

In preparing these Standalone financial statements, the Group has applied following policies:

A) Foreign Branches of the Company (outside India with functional currency other than presentation currency): -

1. Income and expense items are translated at the exchange rates at the dates of the transactions and all resulting exchange differences are recognised in the Standalone Statement of Profit and Loss.

2. Non-monetary assets and liabilities are measured in terms of historical cost in foreign currencies and are not translated at the rates prevailing at the reporting period. Monetary assets and liabilities are translated at the rates prevailing at the end of each reporting period. Exchange differences on translations are recognised in the Standalone Statement of Profit and Loss.

B) Joint Operations and subsidiaries outside India with functional currency other than presentation currency:

1. Assets and liabilities, both monetary and non-monetary are translated at the rates prevailing at the end of each reporting year.

2. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in equity (and attributed to non-controlling interests as appropriate).

(ii) Foreign currency transactions and balances

In preparing the standalone financial statements of each individual Company entity, transactions in currencies other than the entity''s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences on monetary items are recognised in Statement of Profit and Loss in the period in which they arise except for:

â¢ Exchange differences on transactions entered into in order to hedge certain foreign currency risks; and

â¢ Exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur (therefore forming part of the net investment in the foreign operation), which are recognised initially in other comprehensive income and reclassified from equity to profit or loss on repayment of the monetary items.

On the disposal of a foreign operation (i.e. a disposal of the Company''s entire interest in a foreign operation, a disposal involving loss of control over a foreign operation, or a partial disposal of an interest in a foreign operation of which the retained interest becomes a financial asset), all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of the Company are reclassified to profit or loss.

In addition, in relation to a partial disposal of a foreign operation that does not result in the Company losing control over the foreign operation, the proportionate share of accumulated exchange differences is re-attributed to non-controlling interests and are not recognised in profit or loss. For all other partial disposals (i.e. partial disposals of associates or joint arrangements that do not result in the Company losing significant influence or joint control), the proportionate share of the accumulated exchange differences is reclassified to profit or loss.

Goodwill and fair value adjustments to identifiable assets acquired and liabilities assumed through acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of exchange prevailing at the end of each reporting period. Exchange differences on such items are recognised in other comprehensive income.

1.B.5. Borrowing costs

Borrowing 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 their intended use or sale.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

1.B.6. Employee benefits

1.B.6.1 Retirement benefit costs and termination benefits

Employee benefits include provident fund, superannuation fund, employee state insurance scheme, gratuity fund, compensated absences and leave encashment.

Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions.

The liability or asset recognised in the balance sheet in respect of defined benefit plan is the present value of the defined benefit obligation at the end of the reporting period less fair value of plan assets.

For defined retirement benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.

Defined benefit costs are categorised as follows:

â¢ Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

â¢ Net interest expense or income; and

â¢ Re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item âEmployee benefits expense''. Curtailment gains and losses are accounted for as past service costs.

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

The retirement benefit obligation recognized in the standalone financial statements represents the actual deficit or surplus in the Company''s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of the termination benefit and when the entity recognises any related restructuring costs.

1.B.6.2 Short-term and other long-term employee benefits

A liability is recognised for benefits accruing to employees in respect of salaries, wages and other short-term employee benefits in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.

Provision for leave benefits to employees is based on actuarial valuation done by projected accrued benefit method at the reporting date.

I.B.7. Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

1.B.7.1 Current tax

The income tax expense or credit for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the company and its jointly controlled operation operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

1.B.7.2 Deferred tax

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the standalone financial statements. However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax is realised or the deferred income tax liability is settled.

Deferred tax assets are recognized for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax liabilities are not recognized for temporary differences between the carrying amount and tax bases of investments in branches and interest in joint arrangements where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets are not recognized for temporary differences between the carrying amount and tax bases of investments in branches and interest in joint arrangements where it is not probable that the differences will reverse in the foreseeable future and taxable profit will not be available against which the temporary difference can be utilised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers whether it is probable that the taxation authority will accept tax position taken by the Group. Uncertain tax positions are reflected in the overall measurement of the Group''s tax expense and are based on the most likely amount or the expected value arrived at by the Group which provides a better prediction of the resolution of uncertainty. Uncertain tax positions are monitored and updated as and when new information becomes available, typically upon examination or action by the taxing authorities or through statute expiration and judicial precedent. The Group considers whether a particular amount payable or receivable for interest and penalties is an income tax, in which case Ind AS 12 is applied to that amount. When an amount payable for interest and penalties is determined to be within the scope of Ind AS 37, it is presented as part of financing cost or other expenses, respectively unless when there is an overall settlement with tax authority and the interest and penalties cannot be identified separately in which case it is determined to be part of income taxes.

1.B.7.3 Current and deferred tax for the year

Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

1.B.8 Property, plant and equipment

Property, plant and equipment are carried at cost less accumulated depreciation and impairment losses, if any. The cost of property, plant and equipment comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, other incidental expenses and interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use. It also includes initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located. Replacement cost of an item of property, plant and equipment is capitalised if replacement meets the recognition criteria.

Estimated useful lives of the assets are as follows:

Buildings - 60 years Furniture and fixtures - 10 years Vehicles - 10 years Office equipment - 5 years Freehold land is not depreciated

For following assets estimated useful life is different than the useful life prescribed in schedule II to the Companies Act, 2013 and has been assessed on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc.

Plant & Equipment (except Tunnel Boring Machines) which includes Cranes < 100 mt., Concreting, Crushing, Piling, Road making, Laboratory & Welding Equipment, Floating Equipment - 20 Years.

Tunnel Boring Machines - Length of the tunnel bored over life of the construction project for where it is used.

Cost of shuttering materials, issued to jobs, is charged off equally over a period of four years.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the net sales proceeds and the carrying amount of the asset and is recognised in profit or loss.

1.B.8.1 Capital work-in-progress

Property, plant and equipment that are not yet ready for their intended use are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

1.B.9 Intangible assets

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated impairment losses. Useful life is as below:

Computer software - 5 years

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses from derecognition of an intangible asset, measured at the difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss when the asset is derecognised.

1.B.10 Impairment of tangible and intangible assets other than goodwill

At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When 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. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest Company of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.

1.B.11 Inventories

Inventories are stated at the lower of cost and net realisable value. Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale. Cost is determined on the basis of weighted average method.

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