Accounting Policies of JSW Cement Ltd. Company

Mar 31, 2025

2. MATERIAL ACCOUNTING POLICIES

I. Statement of Compliances

Standalone Financial Statements have been prepared in
accordance with the accounting principles generally accepted in
India including Indian Accounting Standards (Ind AS) prescribed
under the section 133 of the Companies Act, 2013 read with
rule 3 of the Companies (Indian Accounting Standards) Rules,
2015 (as amended from time to time) and presentation and
disclosures requirement of Division II of revised Schedule III
of the Companies Act 2013, (Ind AS Compliant Schedule III), as
applicable to Standalone Financial Statements.

Accordingly, the Company has prepared these Standalone
Financial Statements which comprise the Standalone Balance
Sheet as at 31 March 2025, the Standalone Statement of Profit
and Loss, the Standalone Statement of Cash Flows and the
Standalone Statement of Changes in Equity for the year ended
as on that date, and accounting policies and other explanatory
information (together hereinafter referred to as "Standalone
Financial Statements" or "financial statements").

These Standalone Financial Statements are approved for issue
by the Board of Directors on 16^th May 2025.

II. Basis of preparation and presentation

The Standalone Financial Statements have been prepared on
the historical cost convention, on the accrual basis except for
certain financial instruments measured at fair values at the
end of each reporting year, as explained in the accounting
policies below.

The Standalone Financial Statements are presented in
Indian Rupees (which is also the functional currency of the
Company) and is rounded off to the nearest crores except
otherwise indicated. Amounts less than '' 50,000 have been
presented as "*"

Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date, regardless of
whether that price is directly observable or estimated using
another valuation technique. In estimating the fair value of
an asset or a liability, the Company takes in account the
characteristics of the asset or liability if market participants
would take those characteristics into account when pricing
the asset or liability at the measurement date. Fair value for
measurement and/or disclosure purposes in these Standalone
Financial Statements is determined on such a basis, except for
share-based payment transactions that are within the scope
of Ind AS 102, leasing transactions that are within the scope of
Ind AS116, fair value of plan assets within the scope of Ind AS
19 and measurements that have some similarities to fair value
but are not fair value, such as net realisable value in Ind AS 2 or
value in use in Ind AS 36.

In addition, for financial reporting purposes, fair value
measurements are categorised into Level 1, 2, or 3 based on
the degree to which the inputs to the fair value measurements
are observable and the significance of the inputs to the fair value
measurements 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 entity can
access at the measurement date;

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

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

Current and non-current classification

The Company presents assets and liabilities in the balance sheet
based on current / non-current classification.

An asset is classified as current when it satisfies any of the
following criteria:

• I t is expected to be realised in or is intended for sale or
consumption in, the Company''s normal operating cycle. it
is held primarily for the purpose of being traded;

• I t is expected to be realised within 12 months after the
reporting date; or

• I t is cash or cash equivalent unless it is restricted from
being exchanged or used to settle a liability for at least 12
months after the reporting date.

All other assets are classified as non-current.

A liability is classified as current when it satisfies any of the
following criteria:

• I t is expected to be settled in the Company''s normal
operating cycle;

• It is held primarily for the purpose of being traded;

• It is due to be settled within 12 months after the reporting
date; or the Company does not have an unconditional right
to defer settlement of the liability for at least 12 months
after the reporting date. Terms of a liability that could, at the
option of the counterparty, result in its settlement by the
issue of equity instruments do not affect its classification.

All other liabilities are classified as non-current.

The operating cycle is the time between the acquisition of assets
for processing and their realisation in cash and cash equivalents.
The company has identified 12 months as its operating cycle.

Deferred tax assets and liabilities are classified as non¬
current only.

III. Revenue Recognition

A. Sale of Goods

Revenue towards satisfaction of a performance obligation is
measured at the amount of transaction price (net of variable
consideration) allocated to that performance obligation. The
transaction price of goods sold and services rendered is net
of variable consideration on account of various discounts and
schemes offered by the Company as part of the contract.

Contract Balances

i) Contract assets

A contract asset is the right to consideration in exchange
for goods or services transferred to the customer. If the
Company performs by transferring goods or services to
a customer before the customer pays consideration or
before payment is due, a contract asset is recognised for
the earned consideration.

ii) Trade receivable

Trade receivables that do not contain a significant
financing component are measured at transaction price.

iii) Contract liabilities

A contract liability is the obligation to transfer goods or
services to a customer for which the Company has received
consideration (or an amount of consideration is due) from
the customer. If a customer pays consideration before the
Company transfers goods or services to the customer, a
contract liability is recognised when the payment is made
or the payment is due (whichever is earlier). Contract
liabilities are recognised as revenue when the Company

performs under the contract including Advance received
from Customer.

iv) Refund liabilities

A refund liability is the obligation to refund some or all
of the consideration received (or receivable) from the
customer and is measured at the amount the Company
ultimately expects it will have to return to the customer
including volume rebates and discounts. The Company
updates its estimates of refund liabilities at the end of
each reporting period.

B. 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.

IV. Leases

The Company assesses at contract inception whether a contract
is, or contains, a lease. That is, if the contract conveys the right
to control the use of an identified asset for a period of time in
exchange for consideration.

Company as lessor

Leases in which the Company does not transfer substantially
all the risks and rewards incidental to ownership of an asset
are classified as operating leases. Rental income arising is
accounted for on a straight-line basis over the lease terms.
Initial direct costs incurred in negotiating and arranging an
operating lease are added to the carrying amount of the leased
asset and recognised over the lease term on the same basis as
rental income. Contingent rents are recognised as revenue in the
period in which they are earned.

Company as lessee

The Company applies a single recognition and measurement
approach for all leases, except for short-term leases and leases
of low-value assets. The Company recognises lease liabilities to
make lease payments and right-of-use assets representing the
right to use the underlying assets.

Right-of-use assets

The Company recognises right-of-use assets at the
commencement date of the lease (i.e., the date the underlying
asset is available for use). Right-of-use assets are measured
at cost, less any accumulated depreciation and accumulated
impairment losses, and adjusted for any remeasurement of lease
liabilities. The cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs incurred, and
lease payments made at or before the commencement date less
any lease incentives received. Unless the Company is reasonably
certain to obtain ownership of the leased asset at the end of the
lease term, the recognised right-of-use assets are depreciated
on a straight-line basis over the shorter of its estimated useful
life and the lease term is as follows.

If ownership of the leased asset transfers to the Company at
the end of the lease term or the cost reflects the exercise of a
purchase option, depreciation is calculated using the estimated
useful life of the asset. Right-of-use assets are subject to
impairment test.

The Company accounts for sale and lease back transaction,
recognising right-of-use assets and lease liability, measured in
the same way as other right-of use assets and lease liability.
Gain or loss on the sale transaction is recognised in Standalone
Statement of Profit and Loss.

Lease liabilities

At the commencement date of the lease, the Company recognises
lease liabilities measured at the present value of lease payments
to be made over the lease term. The lease payments include
fixed payments (including in-substance fixed payments) less
any lease incentives receivable, variable lease payments that
depend on an index or a rate, and amounts expected to be paid
under residual value guarantees.

The variable lease payments that do not depend on an index or a
rate are recognised as expense in the period on which the event
or condition that triggers the payment occurs.

In calculating the present value of lease payments, the
Company uses the incremental borrowing rate at the lease
commencement date if the interest rate implicit in the lease
is not readily determinable. After the commencement date, the
amount of lease liabilities is increased to reflect the accretion of
interest and reduced for the lease payments made. In addition,
the carrying amount of lease liabilities is remeasured if there

is a modification, a change in the lease term, a change in the
lease payments (e.g., changes to future payments resulting
from a change in an index or rate used to determine such
lease payments) or a change in the assessment of an option to
purchase the underlying asset.

Short-term leases and leases of low-value assets

The Company applies the short-term lease recognition exemption
to its short-term leases (i.e., those leases that have a lease term
of 12 months or less from the commencement date and do not
contain a purchase option). It also applies the lease of low-value
assets recognition exemption to leases that are considered of
low value (such as tablets, computers, small items of office
furniture and telephones). Lease payments on short-term leases
and leases of low-value assets are recognised as expense on a
straight-line basis over the lease term.

V. Foreign Currencies

The functional currency of the Company is determined on
the basis of the primary economic environment in which it
operates. The functional currency of the Company is Indian
National Rupee (INR).

The 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 year, 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
Standalone Statement of Profit and Loss in the year in which
they arise except for:

a) exchange differences on foreign currency borrowings
relating to assets under construction for future productive
use, which are included in the cost of those assets when
they are regarded as an adjustment to interest costs on
those foreign currency borrowings;

b) exchange differences on transactions entered into in order
to hedge certain foreign currency risks (see below the
policy on hedge accounting in 2 (XVII)(C)(c));

VI. Borrowing Costs

Borrowing costs directly attributable to the acquisition and
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.

All other borrowing costs are recognised in the Standalone
Statement of Profit and Loss in the year in which they are incurred.

The Company determines the amount of borrowing costs eligible
for capitalisation as the actual borrowing costs incurred on that
borrowing during the year less any interest income earned
on temporary investment of specific borrowings pending
their expenditure on qualifying assets, to the extent that an
entity borrows funds specifically for the purpose of obtaining
a qualifying asset. In case if the Company borrows generally
and uses the funds for obtaining a qualifying asset, borrowing
costs eligible for capitalisation are determined by applying a
capitalisation rate to the expenditures on that asset.

Borrowing cost includes exchange difference arising from
foreign currency borrowings to the extent they are regarded as
an adjustment to finance cost.

VII. Government grants

Government grants are not recognised until there is reasonable
assurance that the Company will comply with the conditions
attached to them and that the grants will be received.

Government grants are recognised in the Standalone Statement
of Profit and Loss on a systematic basis over the years in which
the Company recognises as expenses the related costs for which
the grants are intended to compensate or when performance
obligations are met.

VIII. Employee Benefits

Retirement benefit costs and termination benefits

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

For defined benefit 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 year. 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 interest),
is reflected immediately in the Balance sheet with a charge or
credit recognised in other comprehensive income in the year
in which they occur. Re-measurement recognised in other
comprehensive income is reflected immediately in retained
earnings and will not be reclassified to Standalone Statement
of Profit and Loss. Past service cost is recognised in Standalone
Statement of Profit and Loss in the year of a plan amendment

or when the company recongnises corresponding restructuring
cost whichever is earlier. Net interest is calculated by applying
the discount rate to the net defined benefit liability or asset.
Defined benefit costs are categorised as follows:

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

• net interest expense or income; and

• re-measurement

The Company presents the first two components of defined
benefit costs in Standalone Statement of Profit and Loss in the
line item ''Employee benefits expenses''. Curtailment gains and
losses are accounted for as past service costs.

The retirement benefit obligation recognised in the Balance
sheet 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.

Short-term and other long-term employee benefits

A liability is recognised for benefits accruing to employees
in respect of wages and salaries, annual leave and sick/
contingency leave in the year the related service is rendered at
the undiscounted amount of the benefits expected to be paid
in exchange for that service.

Liabilities recognised in respect of short-term employee benefits
are measured at the undiscounted amount of the benefits
expected to be paid in exchange for the related service.

Liabilities recognised in respect of other long-term employee
benefits are measured at the present value of the estimated
future cash outflows expected to be made by the Company
in respect of services provided by employees up to the
reporting date.

IX. Share based payments

Equity-settled share-based payments to employees and others
providing similar services are measured at the fair value of
the equity instruments at the grant date. Details regarding the
determination of the fair value of equity-settled share-based
transactions are set out in note 39e.

The fair value determined at the grant date of the equity
settled share-based payments is expensed on a straight
line basis over the vesting period, based on the Company''s
estimate of equity instruments that will eventually vest, with a
corresponding increase in equity. At the end of each reporting
year, the Company revises its estimate of the number of equity
instruments expected to vest. The impact of the revision of the
original estimates, if any, is recognised in Standalone Statement
of Profit and Loss such that the cumulative expense reflects
the revised estimate, with a corresponding adjustment to the
equity-settled employee benefits reserve.

The Company has created an Employee Welfare Trust for
providing share-based payment to its employees. The Company
uses the Trust as a vehicle for distributing shares to employees
under the employee remuneration schemes.

X. Taxes

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

Current tax

Current tax is the amount of expected tax payable based on
the taxable profit for the year as determined in accordance with
the applicable tax rates and the provisions of the Income Tax
Act, 1961.

Deferred tax

Deferred tax is recognised on temporary differences between
the carrying amounts of assets and liabilities in the Standalone
Financial Statements and the corresponding tax bases used
in the computation of taxable profit. Deferred tax liabilities
are generally recognised for all taxable temporary differences.
Deferred tax assets are recognised for all deductible temporary
differences to the extent that it is probable that taxable profits
will be available against which those deductible temporary
differences can be utilised. Such deferred tax assets and
liabilities are not recognised if the temporary difference arises
from the initial recognition (other than in a business combination)
of assets and liabilities in a transaction that affects neither the
taxable profit nor the accounting profit. In addition, deferred tax
liabilities are not recognised if the temporary difference arises
from the initial recognition of goodwill.

The carrying amount of deferred tax assets is reviewed at the
end of each reporting year and reduced to the extent that it is
no longer probable that sufficient taxable profits will be available
to allow all or part of the asset to be recovered. Unrecognised
deferred tax assets are re-assessed at each reporting date
and are recognised to the extent that it has become probable
that future taxable profits will allow the deferred tax asset to
be recovered.

Minimum Alternate Tax (MAT) paid in accordance with the
tax laws, which gives future economic benefits in the form
of adjustment to future income tax liability, is considered
as an deferred tax asset if there is convincing evidence that
the Company will pay normal income tax. Accordingly, MAT is
recognised as an asset in the Balance Sheet when it is highly
probable that future economic benefit associated with it will flow
to the Company.

Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply in the year in which the liability is
settled or the asset realised, based on tax rates (and tax laws)
that have been enacted or substantively enacted by the end of
the reporting year.

Deferred tax assets and deferred tax liabilities are offset if a
legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to
the same taxable entity and the same taxation authority.

Current and deferred tax for the year

Current and deferred tax are recognised in profit and loss,
except when they are relating 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.

Deferred tax assets and liabilities are offset when they relate
to income taxes levied by the same taxation authority and
the relevant entity intends to settle its current tax assets and
liabilities on a net basis.

XI. Property, Plant and Equipment

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,
including relevant borrowing costs for qualifying assets and
any expected costs of decommissioning. Expenditure incurred
after the property, plant & equipment have been put into the
operation, such as repairs and maintenance, are charged to
Standalone Statement of Profit and Loss in the year in which
cost are incurred. Major shutdown and overhaul expenditure is
capitalised as the activity undertaken improves the economic
benefit expected to arise from the assets.

Spares parts, servicing equipment and standby equipment
which can be used only in connection with a particular Plant
& Equipment of the Company and their use is expected to be

irregular, are capitalised at cost. 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 Standalone Statement of Profit
and Loss.

Assets in the course of construction are capitalised in the
assets under Capital work in progress. At the point when an
asset is operating at management''s intended use, the cost
of construction is transferred to the appropriate category of
property, plant and equipment and depreciation commences.
Costs associated with the commissioning of an asset and any
obligatory decommissioning costs are capitalised where the
asset is available for use but incapable of operating at normal
levels, revenue (net of cost) generated from production during
the trial period is capitalised.

Property, plant and equipment except freehold land held for use
in the production, supply or administrative purposes, are stated
in the balance sheet at cost less accumulated depreciation and
accumulated impairment losses, if any.

The Company has elected to continue with the carrying value
for all of its property, plant and equipment as recognised in
the Standalone Financial Statements on transition to Ind AS,
measured as per the previous GAAP and use that as its deemed
cost as at the date of transition.

Depreciable amount for assets is the cost of an asset, or other
amount substituted for cost, less its estimated residual value.
Depreciation is recognised so as to write off the cost of assets
(other than freehold land and properties under construction)
less their residual values over their useful lives, using straight¬
line method as per the useful life prescribed in Schedule II to the
Companies Act, 2013 except in respect of following categories of
assets, in whose case the life of the assets has been assessed
as under based 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.

When significant parts of property, plant and equipment are
required to be replaced at intervals, the Company depreciates
them separately based on their specific useful lives.

Major overhaul costs are depreciated over the estimated life of
the economic benefit derived from the overhaul. The carrying
amount of the remaining previous overhaul cost is charged to
the Standalone Statement of Profit and Loss if the next overhaul
is undertaken earlier than the previously estimated life of the
economic benefit.

Freehold lands are not depreciated.

Expense Incurred for improvement of leasehold assets which are
expected to have future economic benefit are capitalised and
amortise over the term of the lease.

Capital assets whose ownership does not vest with the Company
are amortised based on the estimated useful life as follows:

The Company reviews the residual value, useful lives and
depreciation method annually and, if expectations differ from
previous estimates, the change is accounted for as a change in
accounting estimate on a prospective basis.

XII. 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.

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 year, 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.

Mining assets are amortised using unit of production method
over the entire lease term.

The Company has elected to continue with carrying value of all
its intangible assets recognised as on transition date, measured
as per the previous GAAP and use that carrying value as its
deemed cost as of transition date.

Mining Assets

Acquisition Costs

The cost of Mining Assets capitalised includes costs associated
with acquisition of licenses and rights to explore, stamp duty,
registration fees and other such costs.

Bid premium and royalties payable with respect to mining
operations is contractual obligation. The said obligations are
variable and linked to market prices. The Company has accounted
for the same as expenditure on accrual basis as and when
related liability arises as per respective agreements/ statute.

Exploration and evaluation

Exploration and evaluation expenditure incurred after obtaining
the mining right or the legal right to explore are capitalised as
exploration and evaluation assets (intangible assets) and stated
at cost less impairment. Exploration and evaluation assets are
assessed for impairment when facts and circumstances suggest
that the carrying amount of an exploration and evaluation asset
may exceed its recoverable amount.

The Company measures its exploration and evaluation assets
at cost and classifies as Property, plant and equipment or
intangible assets according to the nature of the assets acquired
and applies the classification consistently. To the extent that
tangible asset is consumed in developing an intangible asset,
the amount reflecting that consumption is capitalised as a part
of the cost of the intangible asset.

Exploration expenditure includes all direct and allocated indirect
expenditure associated with finding specific mineral resources
which includes depreciation and applicable operating costs
of related support equipment and facilities and other costs of
exploration activities:

General exploration costs - costs of surveys and studies, rights
of access to properties to conduct those studies (e.g., costs
incurred for environment clearance, defense clearance, etc.),
and salaries and other expenses of geologists, geophysical
crews and other personnel conducting those studies.

Costs of exploration drilling and equipping exploration -
Expenditure incurred on the acquisition of a license interest is
initially capitalised on a license by-license basis. Costs are held,

undepleted, within exploration and evaluation assets until such
time as the exploration phase on the license area is complete
or commercial reserves have been discovered.

Stripping cost

Developmental stripping costs in order to obtain access to
quantities of mineral reserves that will be mined in future
periods are capitalised as part of mining assets. Capitalisation
of developmental stripping costs ends when the commercial
production of the mineral reserves begins.

Production stripping costs are incurred to extract the minerals in
the form of inventories and/or to improve access to an additional
component of a mineral body or deeper levels of material.
Production stripping costs are accounted for as inventories
to the extent the benefit from production stripping activity is
realised in the form of inventories.

Other production stripping cost incurred are expensed in the
Standalone Statement of Profit and Loss.

Developmental stripping costs are presented within mining
assets. After initial recognition, stripping activity assets are
carried at cost less accumulated amortisation and impairment.
The expected useful life of the identified component of the
mineral is used to depreciate or amortise the stripping asset.

Mine restoration, rehabilitation and environmental costs:

Provision is made for costs associated with restoration and
rehabilitation of mining sites as soon as the obligation to incur
such costs arises. Such restoration and closure costs are typical
of extractive industries and they are normally incurred at the
end of the life of the mine. The costs are estimated on the basis
of mine closure plans and the estimated discounted costs
of dismantling and removing these facilities and the costs of
restoration are capitalised. The provision for decommissioning
assets is based on the current estimates of the costs for
removing and decommissioning production facilities, the
forecast timing of settlement of decommissioning liabilities
and the appropriate discount rate. A corresponding provision is
created on the liability side. The capitalised asset is charged to
profit and loss over the life of the asset through amortisation
over the life of the operation and the provision is increased each
period via unwinding the discount on the provision. Management
estimates are based on local legislation and/or other agreements
are reviewed periodically.

The actual costs and cash outflows may differ from estimates
because of changes in laws and regulations, changes in
prices, analysis of site conditions and changes in restoration
technology. Details of such provisions are set out in note 22

XIII. Impairment of Non-financial assets

At the end of each reporting year, 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). Where it is
not possible to estimate the recoverable amount of an individual
asset, the Company estimates the recoverable amount of the
cash-generating unit to which the asset belongs. Where 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 group of
cash-generating units for which a reasonable and consistent
allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible
assets not yet available for use are tested for impairment at least
annually, and whenever there is an indication that the asset may
be impaired.

Recoverable amount is the higher of fair value less costs to sell
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 the Standalone Statement of Profit and Loss.

The carrying amounts of the Company''s non-financial assets
are reviewed at each reporting date to determine whether there
is any indication of impairment. If any such indication exists,
then the asset''s recoverable amount is estimated in order to
determine the extent of the impairment loss, if any.

XIV. Inventories

Inventories are stated at the lower of cost and net realisable value.

Cost of raw materials include cost of purchase and other costs
incurred in bringing the inventories to their present location
and condition. Cost of semi-finished /finished goods and work
in progress include cost of direct materials and labor and a
proportion of manufacturing overheads based on the normal
operating capacity but excluding borrowing costs. Cost of traded
goods include purchase cost and inward freight.

Costs of inventories are determined on weighted average basis.
Net realisable value represents the estimated selling price for

inventories less all estimated costs of completion and costs
necessary to make the sale.