Accounting Policies of Neopolitan Pizza and Foods Ltd. Company

Mar 31, 2025

2 SIGNIFICANT ACCOUNTING POLICIES
a Basis of preparation of Financial statements:

These standalone financial statements have been prepared to comply with the Generally Accepted Accounting Principles (Indian
GAAP), including Accounting Standards notified under the relevant provisions of the Companies Act, 2013. The standalone
financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies not
specifically referred, are consistently applied from the past accounting periods.

b Use of Estimates

The preparation of standalone financial statements in conformity with the Generally Accepted Accounting Policies requires the
management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenues and expenses
and disclosures of contingent assets and liabilities. The estimates and assumptions used in the accompanying standalone
financial statements are based upon management''s evaluation of the relevant facts and circumstances as on the date of the
standalone financial statements. Actual results may differ from the estimates and assumptions used in preparing the
accompanying financial statements. Any differences of actual results to such estimates are recognized in the period in which the
results are known/ materialized.

c Revenue recognition

Having regard to size, nature and complexity of business and practices followed by others in the same line and level of business,
the management is of opinion that Company is applying accrual basis of accounting for recognition of income and expenditure
earned or incurred respectively, in the normal course of business.

d Inventories

Inventories are stated at the lower of cost or net realisation value.
e Employee benefits

Shortterm benefits such as salary, bonus, ex-gratia and other benefits as may be applicable on the Company are accounted for
on accrual basis. The Company at present does not have any Defined Contribution Plan or Defined Benefit Plan as contemplated
under AS- 15 on ''Employee Benefits''.

f Taxes on income

Tax Expenses comprise of Current and Minimum Alternate Tax. Current Tax is determined as the amount of tax payable on the
taxable income for the year, using tax rates as per the relevant tax regulations and any adjustment to tax payable in respect of
previous year.

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is
calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date.
Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty
of its realisation, supported by convincing evidence.

Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of
its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

Current income tax expense comprises taxes on income from operations in India and in foreign jurisdictions. Income tax
payable in India is determined in accordance with the provisions of the Income Tax Act, 1961. Tax expense relating to foreign
operations is determined in accordance with tax laws applicable in countries where such operations are domiciled. Minimum
Alternative Tax (MAT) paid in accordance with the tax laws in India, which gives rise to future economic benefits in the form of
adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company and its
Indian subsidiaries will pay normal income tax after the tax holiday period. Accordingly, MAT is recognised as an asset in the
balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with it
will fructify.

g Provisions

A provision is recognized when the Company has a present obligation as a result of past event, it is probable that an outflow of
resource embodying economic benefits will be require to settle the obligation and a reliable estimate can be made of the
amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate
required to settle the obligation at the reporting date. These estimates are reviewed at the end of each reporting date and
adjusted to reflect the current best estimates.

h Inventories

Raw materials are carried at the lower of cost and net realisable value. Cost is determined on a weighted average basis.
Purchased goods-in-transit are carried at cost. Work-in-progress is carried at the lower of cost and net realisable value. Stores
and spare parts are carried at lower of cost and net realisable value. Finished goods produced or purchased by the Company are
carried at lower of cost and net realisable value. Cost includes direct material and labour cost and a proportion of
manufacturing overheads.

i Cash and cash equivalents

The Company considers 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, to be cash equivalents.

j Revenue recognition

Revenue from the sale of equipment are recognised upon delivery, which is when title passes to the customer. Revenue is
reported net of discounts.

Interest income is recognised on time proportion basis taking into account the amount outstanding and the rate applicable.

k Property, Plant & Equipment (AS- 10)

Fixed Assets:-

Fixed Assets are value at cost less depreciation. The depreciation has been calculated as prescribed in Companies Act, 2013 on
single shift and if the Asset is purchased during the year depreciation is provided on the days of utilisation in that year.

Depreciation on Fixed Assets:-

Pursuant to Companies Act, 2013 (''the Act'') being effective from 1 April 2014, the Company has revised Depreciation rates on
tangible fixed assets as per the useful life specified in part ''C'' of schedule II of the Act. Depreciation on Fixed Assets is provided
as per Straight Line method on the basis of useful life of assets specified and in the manner specified in the Schedule II of the
Companies Act, 2013.

Tangible assets, if any are stated at cost, less accumulated depreciation and impairment, if any. Direct costs are capitalized until
such assets are ready for use.

Depreciation has been charged on cost of fixed assets, adopting the following methods / rates:

1. On straight line method over the remaining useful life of the assets as prescribed under Schedule II to the Companies Act,
2013 or as estimated by the Management.

2. If the cost of a part of the asset is significant to the total cost of the asset and useful life of that part is different from the
useful life of the remaining asset, useful life of that significant part is determined separately for depreciation.

3. For other assets acquired / sold during the year pro-rata charge has been made from the date of first use or till the date of
sale.

l Cash and cash equivalents:

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short term balances (with an original
maturity of three months or less from the date of acquisition) and highly liquid investments that are readily convertible into
known amounts of cash and which are subject to insignificant risk of changes in value.

For the purposes of the cash flow statement, cash and cash equivalents include cash on hand, in banks and demand deposits
with banks, net of outstanding bank overdrafts that are repayable on demand, book overdraft and are considered part of the
Company''s cash management system.

m The Effect of changes in Foreign Exchange Rates:

An enterprise may carry on activities involving foreign exchange in two ways. It may have transactions in foreign currencies or it
may have foreign operations.

Initial Recognization:

A foreign currency transaction is a transaction which is denominated in or requires settlement in a foreign currency, including
transactions arising when an enterprise either: (a) buys or sells goods or services whose price is denominated in a foreign
currency; (b) borrows or lends funds when the amounts payable or receivable are denominated in a foreign currency; (c)
becomes a party to an unperformed forward exchange contract; or (d) otherwise acquires or disposes of assets, or incurs or
settles liabilities, denominated in a foreign currency. A foreign currency transaction should be recorded, on initial recognition in
the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the
foreign currency at the date of the transaction.

At Balancesheet date:

(a) foreign currency monetary items should be reported using the closing rate. However, in certain circumstances, the closing
rate may not reflect with reasonable accuracy the amount in reporting currency that is likely to be realised from, or required to
disburse, a foreign currency monetary item at the balance sheet date, e.g., where there are restrictions on remittances or where
the closing rate is unrealistic and it is not possible to effect an exchange of currencies at that rate at the balance sheet date. In
such circumstances, the relevant monetary item should be reported in the reporting currency at the amount which is likely to
be realised from, or required to disburse, such item at the balance sheet date; (b) non-monetary items which are carried in
terms of historical cost denominated in a foreign currency should be reported using the exchange rate at the date of the
transaction; and (c) non-monetary items which are carried at fair value or other similar valuation denominated in a foreign
currency should be reported using the exchange rates that existed when the values were determined.

n Taxation

Current income tax expense comprises taxes on income from operations in India and in foreign jurisdictions. Income taxpayable
in India is determined in accordance with the provisions of the Income Tax Act, 1961. Tax expense relating to foreign operations
is determined in accordance with tax laws applicable in countries where such operations are domiciled.

Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which gives rise to future economic benefits in
the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company
will pay normal income tax after the tax holiday period. Accordingly, MAT is recognised as an asset in the balance sheet when
the asset can be measured reliably and it is probable that the future economic benefit associated with it will fructify.

Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and
accounting income that originate in one period and is likely to reverse in one or more subsequent periods. Deferred tax assets
and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance
sheet date.

Advance taxes and provisions for current income taxes are presented in the balance sheet after off-setting advance tax paid and
income tax provision arising in the same tax jurisdiction for relevant tax paying units and where the Company is able to and
intends to settle the asset and liability on a net basis.

The Company offsets deferred tax assets and deferred tax liabilities if it has a legally enforceable right and these relate to taxes
on income levied by the same governing taxation laws.

o Cash Flow Statement (AS-3)

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non¬
cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses
associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the group
are segregated.

P

In the opinion of the Board, ''Trade Receivables'', ''Loans and Advances'' and ''Other Current Assets'' are approximately of the
value stated if realized in the ordinary course of business. Confirmation Letters have not been obtained in respect of Trade
Receivable, Trade Payables, loans taken and loan/advances given. Accordingly, such balances are subject to confirmation,
reconciliation and consequent adjustments, if any

q Related Party Disclosure:

List of related parties where control exists and also related parties with whom transactions have taken place and relationships,
has been disclosed in Note - 33 to the Notes to Accounts.

r Other Note:

As per the Ministry of Corporate Affairs (MCA) notification, proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, for
the financial year commencing April 1, 2023, every company which uses accounting software for maintaining its books of
account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction,
creating an edit log of each change made in the books of account along with the date when such changes were made and
ensuring that the audit trail cannot be disabled. The interpretation and guidance on what level edit log and audit trail needs to
be maintained evolved during the year and continues to evolve.

In the company, the accounting software has a feature of audit trail, but it was disable at an application level for maintenance
of books of accounts and relevant transactions. The Company will enable the same in near future.

s

As certified by the company that it was received written representation from all the directors, that companies in which they are
directors had not defaulted in terms of section 164(2) of the companies Act, 2013, and the representation from directors taken
in Board that Director is disqualified from being appointed as Director of the company.