Accounting Policies of Medistep Healthcare Ltd. Company

Mar 31, 2025

2. Significant Accounting Policies
Basis of Preparation of Financial Statements

The Financial Statements of the Company have been prepared and presented in accordance with the Generally Accepted
Accounting Principles in India (''Indian GAAP''). It comprises the Accounting Standards notified u/s 133 read with section 469
of the Companies Act, 2013. The accounting policies have been framed, keeping in view the fundamental accounting
assumptions of Going Concern, Consistency and Accrual, and also the basic considerations of Prudence, Substance over
form, and Materiality. Based on the nature of products and the time between acquisition of assets and their realisation in
cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non¬
current classification of assets and liabilities. These financial statements have been prepared on historical cost basis except
certain items like Financial Leases and Defined Benefit Plans are measured at fair value.

Use of Estimates

The preparation of financial statements requires the management to make certain estimates and assumptions that affect the
amounts reported in the financial statements and notes thereto. The management believes that these estimates and
assumptions are reasonable and prudent but the actual results may differ from them. They are reviewed on an on-going
basis and any revision to accounting estimates is recognised prospectively in current and future periods. Accounting
estimates and assumptions that have a significant effect on the amounts reported in the financial statements include:

i) Net Realisable value of items of Inventories

ii) Useful life and Residual value of Property, Plant and Equipment and Intangible Assets

iii) Defined Benefit obligations

iv) Deferred Tax asset or liability

v) Provisions for Trade Receivables

vi) Other Provisions and Contingencies

Property, Plant and Equipments

Property, plant and equipments are initially recognised at cost. Cost includes purchase price, taxes and duties and other
costs directly attributable to bringing the asset to the working condition for its intended use. However, cost excludes duties
and taxes wherever credit of such duties and taxes is availed. It is thereafter carried at its cost less accumulated depreciation
and accumulated impairment losses, if any.

Depreciation on tangible assets has been provided on "Written Down Value" method in accordance with the provision of
Schedule II of the Companies Act, 2013. Depreciation in respect of tangible assets put to use in current year has been
charged on pro rata basis. Residual values @ 5% of the cost of assets are provided.

Depreciation and amortization methods, useful lives and residual values are reviewed periodically.

Investments

Long-term investments are valued at cost less provision for diminution in value, if the diminution is other than temporary.
Current investments are valued at lower of cost and fair value. Gain or loss arising on the sale of investments is computed as
a difference between carrying amount and the proceeds from sale, net of any expenses. Such gain or loss is recognised in the
Statement of Profit and Loss.

Inventories

Inventories are valued at the lower of cost and net realisable value. Cost is computed on a ''First In First Out'' basis.

Cost of raw materials and stores and spares includes cost of purchase and other costs incurred in bringing the inventories to
their present location and condition. The aforesaid items are valued at net realisable value if the finished products in which
they are to be incorporated are expected to be sold at a loss. Cost of finished goods and work-in-progress include all costs of
purchases, conversion costs and other costs incurred in bringing the inventories to their present location and condition. The
net realisable value is the estimated selling price in the

ordinary course of business less the estimated costs of completion and estimated costs necessary to make the sale.

Trade Receivables and Loans and Advances

Trade Receivables and Loans and Advances are presented after making adequate provision for any shortfall in their recovery.
The provision and any subsequent recovery is recognised in the Profit and Loss statement. Bad debts are written off when
they are identified.

Cash and cash equivalents

All highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an
insignificant risk of change in value and having original maturities of three months or less from the date of purchase are
considered to be cash equivalents.