Accounting Policies of Pramara Promotions Ltd. Company

Mar 31, 2025

1. MATERIAL ACCOUNTING POLICIES

(I) BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

The financial statements have been prepared under the historical cost
convention on an accrual basis and comply in all material aspects with the
mandatory accounting standards and the relevant provisions of the Companies
Act, 2013. Some small and petty cash expenses are accounted for either on
receipt of the relevant advice or on the payment of the actual expenditure
whichever is earlier.

(II) USE OF ESTIMATES

The presentation and preparation of financial statements in conformity with
the generally accepted accounting principles requires estimates and
assumptions to be made that affect the reported amount of revenues and
expenses during the reporting year. Difference between the actual result and
the estimates are recognized in the year in which the results are known/
materialized.

(III) FIXED ASSETS AND DEPRECIATION:

i. Depreciable amount for assets is the cost of an asset, or other amount
substituted for cost, less its estimated residual value. The depreciation on
tangible assets has been provided on the WDV basis as per the useful life
prescribed in Schedule II to the Companies Act, 2013. We have not done any
physical verification of fixed assets; we are relying on the Certificate by
management.

The company not charge the depreciation on moulds that are not in use and all
those Moulds that are not in use in manufacturing during the year.

(IV) INVENTORIES:

i. Raw materials, packing material are valued at lower of Cost or net realizable
value on FIFO basis.

ii. Scrap is valued at net realizable value

iii. Goods in Transit are valued at cost to date.

iv. ‘Cost’ comprises all costs of purchase, cost of conversion & other costs incurred
in bringing the inventory to the present location & condition.

v. We have not done physical verification of inventory of the company. We are
relying on the management certificate for the total inventory of the company.

(V) CASH AND CASH EQUIVALENT:

Cash and cash equivalents for the purpose of cash flow statements
comprise cash at bank and in hand and short-term investments with an
original maturity of twelve months or less.

(VI) REVENUE RECOGNITION:

i. Sales and sale of service:

Sales comprise sale of goods & services and other charges such as freight and
forwarding, octroi charges, and exchange difference wherever applicable.
Revenue from Services is recognized as and when services are rendered.

ii. Other Income:

Interest incomes are recognized on accrual basis in the Statement of Profit &
Loss.

iii. Export Benefits:

Export benefits are recognized in the year of Export.

iv. Dividend:

Dividend income is accounted for as and when received & when the Company’s

right to receive dividend is established.

(VII) TAXATION:

i. Provision for income tax is made on the basis of the taxable income for the
current accounting period in accordance with the provisions of the Income Tax
Act, 1961.

ii. Deferred tax is recognized, subject to the consideration of prudence, on timing
difference being the difference between taxable incomes and accounting income
for the year is accounted for using the tax rates & laws that have been enacted
and substantially enacted as of the balance sheet date. Deferred tax assets
arising from timing difference are recognized to the extent there is virtual
certainty that this would be realized in future and are reviewed for the
appropriateness of their respective carrying values at each Balance sheet date.

(VIII) INVESTMENT: -

Long term Investments are stated at cost. Provision for diminution in value of
long term investment is made only if such decline is other than temporary in
the opinion of the management.

Current Investments are carried individual at the lower of cost & fair value.

(IX) FOREIGN CURRENCIES:

i. Transactions in Foreign currencies are recorded at the exchange rate
prevailing on the date of transaction. Amount short or excess realized/incurred
is transferred to Statement of profit & Loss.

ii. All foreign currency liabilities/assets not covered by forward contracts, if
any, are restated at the rates prevailing at year end and any exchange
difference are debited/ credited to the statement of Profit & Loss.

iii. In respect of transaction covered by forward contracts, the difference
between the contract rate and the spot rate on the date of transaction is
charged to the statement of profit and loss over the period of contract.
Company has not entered into any transaction of forward contracts during the
year.

(X) GOVERNMENT GRANT:

The Government grants are treated as deferred income. The deferred income
is recognized in the statement of profit & loss on systematic and rational basis
over the periods necessary to match them with the related costs, which they are
intended to compensate.

(XI) EMPLOYEES BENEFITS:

As per the AS 15 issued by the Institute of Chartered Accountant of India
details as below

i. Short term employee benefits are recognized as an expense at the undiscounted
amounts in the statement of profit & loss of the year in which the related service
is rendered.

ii. Contribution payable to the recommended Provident Fund is charged to
Statement of Profit & Loss.

iii. Liabilities in respect of:

A. Gratuity:

The company has not made any provision for Gratuity during the year.
Company has changed the accounting policies & Gratuity will be
considered on Payment basis. As on 31.03.2025 outstanding balance of
Provision is Rs.18,43,525.

B. Bonus:

The company has not made any provision for Bonus during the year. It
will be considered on Payment basis.

iv. Other defined contribution for employees’ benefit:

i. The defined contribution for Leave travel allowance and medical re¬
imbursement are recognized on actual basis in the profit & loss
Statement in the year when the eligible employee actually renders the
service.

(XII) . BORROWING COST:

Borrowing cost attributable to the acquisition or construction of qualifying
assets is capitalized as part of the cost of such assets. A qualifying asset is
one that necessarily takes a substantial period of time to get ready for its
intended use or sale as per Accounting Standard 16 “Borrowing Cost”. Other
Interest and borrowing costs are charged to revenue.

(XIII) . EARNING PER SHARE:

Basic Earnings per share is computed by dividing net profit or loss for the
period attributable to equity shareholders by the weighted average number of
shares outstanding during the year. Diluted EPS is computed after adjusting
the effects of all the dilutive potential equity shares except where the results
would be a dilutive. The number of shares used in computing diluted earnings
per share comprises the weighted average number of shares considered for
deriving basic EPS, and also the weighted average number of equity shares,
which would have been issued on the conversion of all dilutive potential
equity shares.

(XIV) . IMPAIRMENT OF ASSETS

The company assesses at each balance sheet date whether there is any
indication that an asset may be impaired. If any such indication exists, the
management estimates the recoverable amount of the assets. If such
recoverable amount of the assets or the recoverable amount of the cash
generating unit to which the asset belongs is less than its carrying amount is
reduced to its recoverable amount. The reduction is treated as an impairment
loss and is recognized in the statement of profit and loss

27] . In the opinion of the Directors, the current assets, loans and advances are

approximately of the value as stated in the balance sheet, if realized in the
ordinary course of the business. The provision of all known liabilities is
adequate and not in excess of the amount reasonably required. We have not
verified the all Debtors & Creditor, Advance to Other Parties, Loans as a third
party confirmation. We are relying on management certificate for their realized
value of the assets.

28] . SUBSIDIARY COMPANY AND ASSOCIATES FIRM:

a) Company has a 100% subsidiary at Honkong (Pramara Promotions Private
Limited-Honkong).

b) Company has a 40% Associate Enterprises relationship with Essel Plast
Pack.

31]. DISCLOSURE OF TRANSACTIONS BETWEEN COMPANY AND RELATED

PARTY:

32. LEASES

Lease arrangement where the risk and reward incidental to ownership of an asset
substantially vest with the lessor are recognized as operating lease. Lease rental
under operating lease are recognized in statement of profit and loss account as and
when accrues. During the year lease charges paid Rs. 87,46,990/-. Future
minimum lease payment due as on Balance Sheet date are as under:

Note:

1. Lease Agreement Daman Factory Starts from 15.08.22 and last date is 14.08.25.

2. Lease Agreement Bhiwandi WH Starts from 01.08.22 and last date is 31.07.25

3. The lease agreement of Delhi WH is under process. And the rent is being paid

by mutual consent till 31.3.2025. We will renew the rent agreement from 01
April 2025.

4. The lease agreement of Guest House Daman is under process. And the rent is

being paid by mutual consent till 31.3.2025. We will renew the rent agreement
from 01 April 2025.

33. LONG TERM BORROWING:

Company has been sanctioned a term loan from Deutsche Bank as Loan Against
Property of Rs. 8,50,00,000 against hypothecation of Office & Residence flat and
offices of Directors of the company & personal guarantee of Mr Rohit Lamba &
Sheetal Lamba Director of the Company. For maturity of loan refer note number 3
of the financial statements.

Company has also been sanctioned Covid-19 loan from Deutsche Bank Ltd Rs
5,61,26,714 & Axis Bank Ltd of Rs. 2,59,00,000 during financial year 2020-21,
2021-22.

The Company has also taken long term borrowings from NBFC of Rs 47,599,49
during the financial year

34. SHORT TERM BORROWING:

Working capital loan has been taken by the company from Deutsche Bank against
the security of stocks, debtors and collateral security of Office of the Company &
Residential Flat and offices of the Directors & all the assets of the company. Loan is
secured by personal guarantee of Mr Rohit Lamba & Mrs. Sheetal Lamba Director of
the Company.

The Company has also taken long term borrowings from NBFC of Rs 1,63,67,759
during the financial year

35. DEBTORS AND CREDITORS & OTHER CURRENT ASSETS

No independent confirmation of balances has been received from debtors and
creditors & Other Current Assets and, therefore, the amounts reported in the
Balance Sheet are those which are reflected in the books of accounts.

36. ACCOUNTING FOR TAXES ON INCOME

Income Tax Assessments of the Company have been completed up to Assessment
Year 2023-24. There is no disputed demand outstanding up to the said Assessment
Year.

During the Current Year provision for Income Tax has been made as per Income Tax
Act, 1961, after considering all available exemptions and deductions.