Notes to Accounts of Diva Organic Living Ltd.

Mar 31, 2024

Note 27 - Financial Risk Management

The Company’s business activities are exposed to financial risks, namely Credit risk, Liquidity risk .The
Company’s Senior Management has the overall responsibility for establishing and governing the Company’s risk
management framework. The Company has constituted a Risk Management Committee, which is responsible for
developing and monitoring the Company’s risk management policies. The committee reports regularly to the Board
of Directors on its activities.

The Company’s risk management policies are established to identify and analyse the risks faced by the Company,
to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies
and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The audit committee oversees how Management monitors compliance with the Company’s risk management
policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks
faced by the Company.

The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and
adhoc reviews of risk management controls and procedures, the results of which are reported the audit committee

i. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to
meet its contractual obligations, and arises principally from the Company’s receivables from customers and
investment securities. Credit risk is managed through credit approvals, establishing credit limits and continuously
monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of
business. The Company establishes, if require an allowance for doubtful debts and impairment that represents its
estimate of incurred losses in respect of trade and other receivables and investments.

iii. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its
financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to
managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they
are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to
the Company’s reputation.

Management monitors rolling forecasts of the Company’s liquidity position on the basis of expected cash flows.
This monitoring includes financial ratios and takes into account the accessibility of cash and cash equivalents

Note 28 Capital Management

For the purpose of the Company’s capital management, capital includes issued capital and other equity reserves.
The primary objective of the Company’s Capital Management is to maximise shareholders value. The Company
manages its capital structure and makes adjustments in the light of changes in economic environment and the
requirements of the financial covenants.

The Company monitors capital using Adjusted net debt to equity ratio. For this purpose, adjusted net debt is
defined as total debt less cash and bank balances

Note 29: First Time Adoption
Explanation of transition to Ind AS:

As per Note 1, these are the Company''s first financial statements prepared in accordance with Ind AS. For the
year ended 31 March 2018, the Company had prepared its financial statements in accordance with Companies
(Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act
(''IGAAP'').

The accounting policies set out in Note 1 have been applied in preparing these financial statements for the year
ended 31 March 2018 and the opening Ind AS balance sheet on the date of transition i.e. 1 April 2016.

In preparing its Ind AS balance sheet as at 1 April 2016 and in presenting the comparative information for the year
ended 31 March 2018, the Company has adjusted amounts previously reported in the financial statements
prepared in accordance with IGAAP. This note explains the principal adjustments made by the Company in
restating its financial statements prepared in accordance with IGAAP, and how the transition from IGAAP to Ind
AS has affected the Company''s financial position, financial performance and cash flows.

Optional exemptions availed and mandatory exceptions

In preparing the financial statements, the Company has applied the below mentioned optional exemptions and
mandatory exceptions.

A. Optional exemptions availed

1. Property, plant and equipment and Intangible assets

The Company has availed the exemption available under Ind AS 101 to continue the carrying value for all of its

property, plant and equipment and intangibles as recognised in the financial statements as at the date of transition
to Ind AS, measured as per the IGAAP and use that as its deemed cost as at the date of transition (1 April 2016).

B. Mandatory Exceptions

1. Estimates

On assessment of the estimates made under the Previous GAA P financial statements, the Company has
concluded that there is no necessity to revise the estimates under Ind AS, as there is no objective evidence of an
error in those estimates. However, estimates that were required under Ind AS but not required under Previous
GAAP are made by the Company for the relevant reporting dates reflecting conditions existing as at that date.

2. Classification and measurement of financial assets

As permited under Ind AS 101, Company has determined the classification of financial assets based on facts and
circumstances that exist on the date of transition. In line with Ind AS 101, measurement of financial assets
accounted at amortised cost has been done retrospectively except where the same is impracticable.

Note 29 Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the
company by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the company (after

Note 30 Financial instruments - Fair values and risk management
(a) Financial Risk Management

The Company''s business activities are exposed to financial risks, namely Credit risk,
Liquidity risk .The Company''s Senior Management has the overall responsibility for
establishing and governing the Company''s risk management framework. The Company has
constituted a Risk Management Committee, which is responsible for developing and
monitoring the Company''s risk management policies. The committee reports regularly to
the Board of Directors on its activities.

The Company''s risk management policies are established to identify and analyse the risks
faced by the Company, to set appropriate risk limits and controls and to monitor risks and
adherence to limits. Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Company''s activities.

The audit committee oversees how Management monitors compliance with the
Company''s risk management policies and procedures, and reviews the adequacy of the
risk management framework in relation to the risks faced by the Company.

The audit committee is assisted in its oversight role by internal audit. Internal audit
undertakes both regular and adhoc reviews of risk management controls and procedures,
the results of which are reported the audit committee

i. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a
financial instrument fails to meet its contractual obligations, and arises principally from the
Company''s receivables from customers and investment securities. Credit risk is managed
through credit approvals, establishing credit limits and continuously monitoring the
creditworthiness of customers to which the Company grants credit terms in the normal
course of business. The Company establishes, if require an allowance for doubtful debts
and impairment that represents its estimate of incurred losses in respect of trade and
other receivables and investments.
iii. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the
obligations associated with its financial liabilities that are settled by delivering cash or
another financial asset. The Company''s approach to managing liquidity is to ensure, as far
as possible, that it will have sufficient liquidity to meet its liabilities when they are due,
under both normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Company''s reputation.

Management monitors rolling forecasts of the Company''s liquidity position on the basis of
expected cash flows. This monitoring includes financial ratios and takes into account the
accessibility of cash and cash equivalents

Note 31 Capital Management

For the purpose of the Company''s capital management, capital includes issued capital and
other equity reserves. The primary objective of the Company''s Capital Management is to
maximise shareholders value. The Company manages its capital structure and makes
adjustments in the light of changes in economic environment and the requirements of the
financial covenants.

The Company monitors capital using Adjusted net debt to equity ratio. For this purpose,
adjusted net debt is defined as total debt less cash and bank balances

Note 34

The Company''s significant leasing arrangements are in respect of premises used for business, are accounted as a
short term lease. The aggregate lease rentals payable are charged as rent in the statement of profit and loss . These
lease arrangements are cancellable in nature and can be terminated by giving notice for a period, which vary from
one months to three months.

Note 35

The spread of COVID-19 pandemic impacted operations for the first quarter of the financials of the Company during
the year ended 31st March, 2022 due to lockdown and restrictions. The operations have shown recovery in the
subsequent quarters. The Company has assessed the impact of pandemic on its financials based on the internal and
external information available upto the date of approval of these Financials. The Company will continue to closely
monitor any material changes to future economic conditions due to this pandemic situation.

Explanation where variance is more than
25%:

* Led by increase in depreciation, finance cost and other expenses corresponding
decrease in profit

** During the year, there is significant increase trade receivables and trade payables as a result of
increase in sales and purchases.

*** Inventory turnover increased due to small quantum of inventory was lying at the
end of the FY.

Note 37

Other Disclosures

(a) The Company do not have any Benami property, where any proceeding has been initiated
or pending against the Company for holding any Benami property.

(b) Transaction with struck off companies: The Company does not have any transactions with
companies struck- off under Section 248 of the Companies Act, 2013.

(c) The Company do not have any charges or satisfaction which is yet to be registered with
ROC beyond the statutory period.

(d) The Company have not traded or invested in Crypto currency or Virtual Currency during
the financial year.

(e) The Company have not advanced or loaned or invested funds to any other person(s) or
entity(ies), including foreign entities (Intermediaries) with the understanding that the
Intermediary shall:

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or;

(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate beneficiaries.

(f) The Company have not received any fund from any person(s) or entity(ies), including
foreign entities (Funding Party) with the understanding (whether recorded in writing or
otherwise) that the Company shall:

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner

whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or;

(ii) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(g) The Company do not have any such transaction which is not recorded in the books of
accounts that has been surrendered or disclosed as income during the year in the tax
assessments under the Income Tax Act, 1961 (such as, search or survey or any other
relevant provisions of the Income Tax Act, 1961).

(h) The Company has complied with the number of layers prescribed under clause (87) of
section 2 of the Act read with the Companies (Restriction on number of Layers) Rules,

2017.

(i) The Code on Social Security, 2020 (''Code'') relating to employee benefits during
employment and post- employment benefits received Presidential assent in September
2020. The Code has been published in the Gazette of India. However, the date on which
the Code will come into effect has not been notified. The company will assess the impact of
the Code when it comes into effect and will record any related impact in the period the
Code becomes effective.

(j) The Company is not declared wilful defaulter by any bank or financial institution or lender
during the year.

(k) There are no significant subsequent events that would require adjustments or disclosures
in the financial statements as on the balance sheet date.

Note 38 MSME

The company has asked for from th e suppliers regarding their registration under Micro, Small and Medium
Enterprises Development Act, 2006. However, the company has not received confirmation from the parties
regarding their registration for the same. Therefore no amount is determined as payable to Micro, Small and
Medium Enterprises in management''s opinion and these facts are been relied upon by the auditor.

Note 39

Previous year''s figures have been regrouped / rearranged wherever necessary, so as to make them comparable
with those of the current year

to be furnished u/s 22 of the Micro Small and Medium Enterprise. This has been relied
upon by the auditors.

As per our report Of Even Date For board & Directors of

For Naik Mehta & Co. WHITE ORGANIC RETAIL

LIMITED.

Chartered Accountants
Firm Reg No : 124529W

CA ALPA NIMESH MEHTA Ishita Gala Tejas Cheda

Partner MANAGING DIRECTOR DIRECTOR

Mem. No. 107896 (DIN: 07165038) (DIN:

07799005)

UDIN : 24107896BKCTTC3181

Place : Mumbai Phani Raju Kothapalli Deepali Jain

CHIEF FINANCIAL OFFICER COMPANY

Date : 28-05-2024 SECRETARY