Accounting Policies of Ducol Organics & Colours Ltd. Company

Mar 31, 2025

1 Significant accounting policies:

1.1 Basis of preparation of financial statements:

These Standalone Financial Statements have been
prepared in accordance with Ind AS as notified under the
Companies (Indian Accounting Standards) Rules, 2015
read with Section 133 of the Companies Act, 2013 (the
"Act”) and other relevant provisions of the act.

The Standalone Financial Statements up to and for the
year ended 31^st March, 2025 were prepared in accordance
with the accounting standards notified under Companies
(Accounting Standards) Rules, 2006 (as amended)
("Previous GAAP”) and other relevant provisions of the Act.

As these are the Company''s first standalone financial
statements prepared in accordance with Indian
Accounting Standards (Ind AS), Ind AS 101, First-time
adoption of Indian Accounting Standards has been
applied. An explanation of how the transition from
previous GAAP to Ind AS has affected the Company''s
previously reported financial position, financial
performance and cash flows is provided in Note 43.

Historical cost convention:

The Standalone Financial Statements have been
prepared on the historical cost basis except for the
following items:

Current versus non-current classification:

All assets and liabilities have been classified as current
or non-current as per the Company''s operating cycle and
other criteria set out in the Schedule III to the Companies
Act, 2013. Based on the nature of products and services
and their realisation in cash and cash equivalents,
the Company has ascertained its operating cycle as
12 months for the purpose of current non-current
classification of assets and liabilities.

1.2 Use Of Estimates:

The preparation of financial statements in conformity
with Indian GAAP requires the management to make
judgments, estimates and assumptions that affect the
reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at
the end of the reporting period. Although these estimates
are based on the management''s best knowledge of
current events and actions, uncertainty about these
assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts
of assets or liabilities in future periods.

1.3 Fixed Assets, Intangible assets and capital work in
progress:

Fixed assets are stated at cost, after reducing
accumulated depreciation and impairment up to the
date of the Balance Sheet. Direct costs are capitalized
until the assets are ready for use and include financing
costs relating to any borrowing attributable to acquisition
of construction of those fixed assets which necessarily
take a substantial period of time to get ready for their
intended use. Capital work in progress includes the
cost of fixed assets that are not yet ready for their
intended use. Intangible assets, if any, are recorded at
the consideration paid for acquisition of such assets and
are carried at cost less accumulated amortization and
impairment.

Transition to Ind AS:

Pursuant to paragraph D7AA of Ind AS 101 - First-time
Adoption of Indian Accounting Standards, the Company
has elected to continue with the carrying values of all
its property, plant and equipment, as recognised in its
previous GAAP financial statements, as the deemed cost
at the date of transition to Ind AS.

Accordingly:

• The carrying amount of PPE under previous GAAP
as at the transition date 31.03.2025 has been
considered as the deemed cost under Ind AS.

• No adjustments have been made to the value of
PPE on account of Ind AS transition.

• The Company has not applied fair value or
revaluation as deemed cost for any of its PPE
assets.

• This policy has been applied consistently to all
items of PPE

Subsequent expenditure:

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

1.4 Depreciation:

Depreciation on fixed assets is determined based on
the estimated useful life of the assets using the written
down value method as prescribed under the schedule II
to the Companies Act, 2013. Individual assets costing
less than '' 5000 or less are depreciated within a year
of acquisition. Depreciation on assets purchased/sold
during the period is proportionately charged. Leasehold
land is amortized on a straight line basis over the period
of lease. Intangible assets, if any, are amortized over their
useful life on a straight line method.

1.5 Goodwill and Other Intangible Assets:

Goodwill:

The excess of the cost of an acquisition over the
Company''s share in the fair value of the acquiree''s
identifiable assets, liabilities, and contingent liabilities is
recognized as goodwill. If the excess is negative, a bargain
purchase gain is recognized in other comprehensive
income and accumulated in equity as Capital reserve.
Goodwill is not amortized but it is tested for impairment
annually, or more frequently if events or change in the
circumstances indicate that it might be impaired, and is
carried at cost less accumulated impairment losses. The
excess of the cost of an acquisition over the Company''s
share in the fair value of the acquiree''s identifiable
assets, liabilities and contingent liabilities is recognized
as goodwill. If the excess is negative, a bargain purchase
gain is recognized in other comprehensive income and
accumulated in equity as Capital reserve. Goodwill is
not amortised but is tested for impairment annually,
or more frequently if events or circumstances indicate
that it might be impaired, and is carried at cost less
accumulated impairment losses.

Other intangible assets:

"Intangible assets acquired separately are measured
on initial recognition at cost. The cost of intangible
assets acquired in a business combination is their
fair value at the date of acquisition. Following initial
recognition, intangible assets are carried at cost less any
accumulated amortisation and accumulated impairment
losses. Internally generated intangible asset arising
from development activity is recognised at cost on
demonstration of its technical feasibility, the intention and
ability of the Company to complete, use or sell it, only if, it
is probable that the asset would generate future economic
benefit and the expenditure attributable to the said assets

during its development can be measured reliably."
Transition to Ind AS:

Pursuant to paragraph D7AA of Ind AS 101 - First-time
Adoption of Indian Accounting Standards, the Company
has elected to continue with the carrying values of all
its property, plant and equipment, as recognised in its
previous GAAP financial statements, as the deemed cost
at the date of transition to Ind AS.

Accordingly:

• The carrying amount of PPE under previous GAAP
as at the transition date 31.03.2025 has been
considered as the deemed cost under Ind AS.

• No adjustments have been made to the value of
PPE on account of Ind AS transition.

• The Company has not applied fair value or
revaluation as deemed cost for any of its PPE
assets.

• This policy has been applied consistently to all
items of PPE

Amortisation of Intangible Assets:

Intangible assets are amortised over their useful lives on
written down value method.

Investment in Subsidiaries:

Investments in subsidiaries are carried at cost less
accumulated impairment losses, if any. Where an
indication of impairment exists, the carrying amount of
the investment is assessed and written down immediately
to its recoverable amount. On disposal of investments
in subsidiaries, the difference between net disposal
proceeds and the carrying amounts is recognized in the
Statement of Profit and Loss. The Company has acquired
susbidiary only after April 1,2024.

1.6 Employee benefits

Short Term benefits are recognized as an expense at
the undiscounted amount in the statement of Profit and
Loss of the year in which related service is rendered.
Retirement benefits in form of gratuity, leave encashment
etc. are accounted for on an accrual basis. The company
has incurred the liabilities in this respect at the end of
the year. Provisions of Employees'' Provident Fund and
Miscellaneous Provisions Act and Payment of gratuity
act are applicable to the company. In compliance with AS
15 (Revised) Employee Benefits, upto current year ended
31 March 2025 company has made provision for Gratuity
at '' 122.86 Lakhs Previous year: '' 109.32 Lakhs.

1.7 Government grants

Grants and subsidies from the government are
recognized when there is reasonable assurance that (i)
the company will comply with the conditions attached
to them, and (ii) the grant/subsidy will be received.
When the grants or subsidy related to revenue, it is
recognized as income on a systematic basis in the
statement of profit and loss over the periods necessary
to match them with the related costs, which they are
intended to compensate. Where the grant relates to an
asset, it is recognized as deferred income and released
to income in equal amounts over the expected useful life
of the related asset.

Government grants of the nature of promoters''
contribution are credited to capital reserve and treated
as a part of the shareholders'' fund.

1.8 Investments

Investments, which are readily realizable and intended to
be held for not more than one year from the date on which
such investments are made, are classified as current
investments. All other investments are classified as long
term investments. Current investments are carried in
the financial statements at lower of cost and fair value
determined on an individual investment basis. Long
term investments are carried at cost. However, provision
for diminution in value is made to recognize a decline
other than temporary in the value of the investments.
On disposal of an investment, the difference between its
carrying amount and net disposal proceeds is charged or
credited to the statement of profit and loss.

Equity investments have been measured at fair value
through Profit and Loss account (FVTPL) as per Ind AS
109, with transition adjustments accounted in retained
earnings as of transition date.

1.9 Inventories

All trading goods are valued at lower of cost and net
realizable value. Cost of inventories is determined on first
in first out basis. Scrap is valued at net realizable value
Net realizable value is the estimated selling price in the
ordinary course of business.

1.10 Revenue recognition

"Revenue is recognized to the extent that it is probable
that the economic benefits will flow to the company and
the revenue can be reliably measured. The following
specific recognition criteria must also be met before
revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the
significant risks and rewards of ownership of the goods
have been passed to the buyer, usually on delivery of
the goods. The company collects GST on behalf of the
government and, therefore, these are not economic
benefits flowing to the company. Hence, they are
excluded from the revenue.

Income from Job work/Services

Revenue from Job work/ Services is recognized when
the contractual obligation is fulfilled and goods/services
are delivered to the contractee.

Interest

Interest income is recognized on a time proportion basis
taking into account the amount outstanding and the
applicable rate of interest. Interest income is included
under the head "Other Income” in the statement of profit
and loss.

1.11 Income Taxes

Tax expenses comprise current and deferred tax.
Current Income tax is measured at the amount
expected to be paid to the tax authorities in accordance
with the Income Tax Act, 1961. The tax rates and tax
laws used to compute the amount are those that are
enacted or substantively enacted, at the reporting date.
Deferred Income taxes reflect the impact of timing
differences between taxable income and accounting
income originating during the current year and reversal
of timing differences for the earlier years. Deferred
tax is measured using the tax rates and the tax laws
enacted or substantively enacted at the reporting date.
Deferred tax liabilities are recognized for all taxable
timing differences. Deferred tax assets are recognized
for deductible timing differences only to the extent that
there is reasonable certainty that sufficient future taxable
income will be available against which such deferred tax
assets can be realized. In situations where the company
has unabsorbed depreciation or carry forward tax losses,
all deferred tax assets are recognized only if there is
virtual certainty supported by convincing evidences
that they can be realized against future taxable profits.
Deferred tax assets are reviewed at each reporting date.
Minimum Alternate Tax paid in a year is charged to the
statement of profit and loss as current tax. The company
recognizes MAT credit available as an asset only to
the extent that there is convincing evidence that the
company will pay normal income tax during the specified

period, i.e., the period for which MAT credit is allowed
to be carried forward. In the year in which the company
recognizes MAT credit as an asset in accordance with
the guidance note on accounting for credit available in
respect of minimum alternate tax under the income tax
act, 1961, the said asset is created by way of credit to the
statement of profit and loss and shown as "MAT Credit
Entitlement.” The company reviews the "MAT credit
entitlement” at each reporting date.

---

Mar 31, 2024

Note - 1. Significant accounting policies

1.1 Basis of preparation of financial statements

The financial statements of the company have been prepared under the historical cost convention, in accordance with generally accepted accounting principles in India (Indian GAAP) on an accrual basis. The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounts) Rules, 2014, and the relevant provisions of the Companies Act, 2013, to the extent applicable and the guidance notes, standards issued by the Institute of Chartered Accountants of India. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard required a change in the accounting policy hitherto in use.

1.2 Use Of Estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

As per MCA notification dated 16th February 2015, companies whose shares are listed on SME exchange as referred to in Chapter XB of SEBI (Issue of Capital and Disclosure requirements) Regulations, 2009 are exempted from the compulsory requirement of adoption of IND-AS. As the Company is covered under the exempted category, it has not adopted IND-AS for preparation of the financial results.

1.3 Fixed Assets, Intangible assets and capital work in progress

Fixed assets are stated at cost, after reducing accumulated depreciation and impairment up to the date of the Balance Sheet. Direct costs are capitalized until the assets are ready for use and include financing costs relating to any borrowing attributable to acquisition of construction of those fixed assets which necessarily take a substantial period of time to get ready for their intended use. Capital

work in progress includes the cost of fixed assets that are not yet ready for their intended use. Intangible assets, if any, are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment.

1.4 Depreciation

Depreciation on fixed assets is determined based on the estimated useful life of the assets using the written down value method as prescribed under the schedule II to the Companies Act, 2013. Individual assets costing less than '' 5000.00 or less are depreciated within a year of acquisition. Depreciation on assets purchased/sold during the period is proportionately charged. Leasehold land is amortized on a straight line basis over the period of lease. Intangible assets, if any, are amortized over their useful life on a straight line method.

1.5 Employee benefits

Short Term benefits are recognized as an expense at the undiscounted amount in the statement of Profit and Loss of the year in which related service is rendered. Retirement benefits in form of gratuity, leave encashment etc. are accounted for on an accrual basis. The company has incurred the liabilities in this respect at the end of the year. Provisions of Employees'' Provident Fund and Miscellaneous Provisions Act and Payment of gratuity act are applicable to the company. In compliance with AS 15 (Revised) Employee Benefits, upto current year ended 31 March 2024 company has made provision for Gratuity at '' 109.32 Lakhs Previous year: '' 88.58 Lakhs.

1.6 Government grants

Grants and subsidies from the government are recognized when there is reasonable assurance that (i) the company will comply with the conditions attached to them, and (ii) the grant/subsidy will be received.

When the grants or subsidy related to revenue, it is recognized as income on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs, which they are intended to compensate. Where the grant relates to an asset, it is recognized as deferred income and released to income in equal amounts over the expected useful life of the related asset.

Government grants of the nature of promoters'' contribution are credited to capital reserve and treated as a part of the shareholders'' fund.

1.7 Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long term

investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.8 Inventories

All trading goods are valued at lower of cost and net realizable value. Cost of inventories is determined on first in first out basis. Scrap is valued at net realizable value Net realizable value is the estimated selling price in the ordinary course of business.

1.9 Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on delivery of the goods. The company collects GST on behalf of the government and, therefore, these are not economic benefits flowing to the company. Hence, they are excluded from the revenue.

Income from Job work/Services

Revenue from Job work/ Services is recognized when the contractual obligation is fulfilled and goods/services are delivered to the contractee.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable rate of interest. Interest income is included under the head "Other Income” in the statement of profit and loss.

1.10 Income Taxes

Tax expenses comprise current and deferred tax. Current Income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred Income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidences that they can be realized against future taxable profits. Deferred tax assets are reviewed at each reporting date. Minimum Alternate Tax paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the guidance note on accounting for credit available in respect of minimum alternate tax under the income tax act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement.” The company reviews the "MAT credit entitlement” at each reporting date.

---

Mar 31, 2023

Company Overview

Dducol Organics and Colours Limited (the company) is a public limited company (CIN:U24239MH1994PLC079015) incorporated on under the provisions of the Comapnies Act, 2013 with the Registrar of companies,. Its registered office is Express Building, Office No. 302, 3^rd Floor, 14-E Road, Churchgate, Mumbai - 400 020.

Note - 1. Significant accounting policies1.1 Basis of preparation of financial statements

The financial statements of the company have been prepared under the historical cost convention, in accordance with generally accepted accounting principles in India (Indian GAAP) on an accrual basis. The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounts) Rules, 2014, and the relevant provisions of the Companies Act, 2013, to the extent applicable and the guidance notes, standards issued by the Institute of Chartered Accountants of India. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard required a change in the accounting policy hitherto in use.

1.2 Use Of Estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

1.3 Fixed Assets, Intangible assets and capital work in progress

Fixed assets are stated at cost, after reducing accumulated depreciation and impairment up to the date of the Balance Sheet. Direct costs are capitalized until the assets are ready for use and include financing costs relating to any borrowing attributable to acquisition of construction of those fixed assets which necessarily take a substantial period of time to get ready for their intended use. Capital work in progress includes the cost of fixed assets that are not yet ready for their intended use. Intangible assets, if any, are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment.

1.4 Depreciation

Depreciation on fixed assets is determined based on

the estimated useful life of the assets using the written down value method as prescribed under the schedule II to the Companies Act, 2013. Individual assets costing less than 5000.00 or less are depreciated within a year of acquisition. Depreciation on assets purchased/sold during the period is proportionately charged. Leasehold land is amortized on a straight line basis over the period of lease. Intangible assets, if any, are amortized over their useful life on a straight line method.

1.5 Employee benefits

Short Term benefits are recognized as an expense at the undiscounted amount in the statement of Profit and Loss of the year in which related service is rendered. Retirement benefits in form of gratuity, leave encashment etc. will be accounted for on accrual basis. The company has not incurred any liabilities in this respect till the end of the year. Provisions of Employees'' Provident Fund and Miscellaneous Provisions Act and Payment of gratuity act are not applicable to the company. However, there is no liability accrued in this respect as on the end of the financial year.

1.6 Government grants

Grants and subsidies from the government are recognized when there is reasonable assurance that (i) the company will comply with the conditions attached to them, and (ii) the grant/subsidy will be received.

When the grants or subsidy related to revenue, it is recognized as income on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs, which they are intended to compensate. Where the grant relates to an asset, it is recognized as deferred income and released to income in equal amounts over the expected useful life of the related asset.

Government grants of the nature of promoters'' contribution are credited to capital reserve and treated as a part of the shareholders'' fund.

1.7 Investments

Investments, which are readily realizable and intended to be held for not more that one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.8 Inventories

All trading goods are valued at lower of cost and net realizable value. Cost of inventories is determined on first in first out basis. Scrap is valued at net realizable value Net realizable value is the estimated selling price in the ordinary course of business.

1.9 Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on delivery of the goods. The company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economic benefits flowing to the company. Hence, they are excluded from the revenue.

Income from Job work/Services

Revenue from Job work/ Services is recognized when the contractual obligation is fulfilled and goods/services are delivered to the contractee.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable rate of interest. Interest income is included under the head "Other Income” in the statement of profit and loss.”

1.10 Income Taxes

Tax expenses comprise current and deferred tax. Current Income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred Income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual

certainty supported by convincing evidences that they can be realized against future taxable profits. Deferred tax assets are reviewed at each reporting date.

Minimum Alternate Tax paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the guidance note on accounting for credit available in respect of minimum alternate tax under the income tax act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement.” The company reviews the "MAT credit entitlement” at each reporting date.

1.11 Provisions and contingent liabilities

The company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a present obligation that cannot be estimated reliably or a possible or present obligation that may, but probably will not, require and outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

1.12 Earning Per Share

Earning per share are calculated by dividing the net profit or loss after taxes for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating, diluted earnings per share, the net profit/ (loss) for the year attributable to equity shareholders and weighted average number of shares outstanding during the year are adjusted for the effects of dilutive potential equity shares.

1.13 Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.