Accounting Policies of Upsurge Seeds of Agriculture Ltd. Company

Mar 31, 2023

SUMMARY STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES & NOTES TO FINANCIAL INFORMATION

1.1 Basis of Preparation & Presentation of Financial Statements: -

The financial statements are prepared on a historical cost basis in accordance with applicable Indian
Accounting Standards (Ind AS) and on accounting principles of going concern which are measured
at fair values. These financial statements have been prepared to comply with all material aspects with
the Indian accounting standards notified under section 133 of the Act, (the "Act") read with Rule 7 of
the Companies (Accounts) Rules, 2014, and the other relevant provisions of the Act.

Accounting policies have been consistently applied except where a newly issued accounting
standard is initially adopted or a revision to an existing accounting standard requires a change in the
accounting policies hitherto in use.

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

1.2 Use of Estimates: -

The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent assets and liabilities on the date of the financial
statements and the results of operations during the reporting periods. Although these estimates are
based upon management''s knowledge of current events and actions, actual results could differ from
those estimates, and revisions, if any, are recognized in the current and future periods.

1.3 Property, Plant, and Equipment
1) Tangible Fixed Assets: -

All property, plant, and equipment are stated at cost, which includes capitalized borrowing costs, less
accumulated depreciation, and impairment loss, if any. Cost includes purchase price, including non¬
refundable duties and taxes, expenditure that is directly attributable to bring the assets to the location
and condition necessary for its intended use, and estimated costs of dismantling and removing the
item and restoring the site on which it is located, if any

Properties in the course of construction for production, supply or administrative purposes are carried at
cost, less any recognized impairment loss. Cost includes professional fees, and for qualifying assets,
borrowing costs capitalized in accordance with the Company''s accounting policies. Such properties
are classified to the appropriate categories of property, plant and equipment when completed and
ready for intended use. Depreciation of these assets, on the same basis as other property assets,
commences when the assets are ready for their intended use. Spare parts are treated as capital assets
when they meet the definition of property, plant and equipment. Otherwise, such items are classified
as inventory.

If significant parts of an item of property, plant and equipment have different useful lives, then they are
accounted for, as separate items (major components) of property, plant and equipment. Any gains or
losses on their disposal, determined by comparing sales proceeds with carrying amount, are
recognized in the Statement of Profit or Loss.

Subsequent expenditure: -

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

De-Recognition: -

An item of property, plant and equipment is de-recognized upon disposal or when no future economic
benefits are expected to arise from its use. Any gain or loss arising from its de-recognition is measured
as the difference between the net disposal proceeds and the carrying amount of the asset and is
recognized in Statement of Profit and Loss when the asset is de-recognized.

Depreciation methods, estimated useful lives and residual value:-

Depreciation on property, plant and equipment is provided using the written down value method
based on the life and in the manner prescribed in Schedule II to the Companies Act, 2013, and is
generally recognized in the statement of profit and loss. Cost of Lease hold is amortized over the tenure
of lease agreement. Freehold land is not depreciated. In case where the cost of part of 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 assets, the useful life of that significant part has been determined separately.

The depreciation methods, useful lives, and residual values are reviewed at each financial year-end
and adjusted if appropriate. Based on technical evaluation and consequent advice, the
management believes that its estimates of useful lives as given above best represent the period over
which management expects to use these assets. Depreciation on additions (disposals) is provided on a
pro-rata basis i.e. from (up to) the date on which the asset is ready for use (disposed of).

Biological assets: -

Recognition and measurement

The company recognizes the biological asset (agricultural produce) when:

(a) the company controls the asset as a result of past events;

(b) it is probable that future economic benefits associated with the asset will flow to the
company; and

(c) the fair value or cost of the asset can be measured reliably

The biological asset is measured at the end of each reporting period at its fair value less costs
to sell.

Capital work in progress: -

Properties in the course of construction for production, supply or administrative purposes are carried at
cost, less any recognized impairment loss. Cost includes professional fees and, for qualifying assets,
borrowing costs capitalized in accordance with the Company''s accounting policy. Such properties are
classified to the appropriate categories of property, plant and equipment when completed and ready
for intended use. Depreciation of these assets, on the same basis as other property assets, commences
when the assets are ready for their intended use.

2) Intangible assets: -

Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. The
cost of an intangible asset comprises its purchase price, and any directly attributable expenditure on
making the asset ready for its intended use and net of any trade discounts and rebates. Subsequent
expenditure on an intangible asset after its purchase is recognized as an expense when incurred unless
it is probable that such expenditure will enable the asset to generate future economic benefits in
excess of its originally assessed standards of performance and such expenditure can be measured and
attributed to the asset reliably, in which case such expenditure is added to the cost of the asset.

1.4 Revenue Recognition: -

Revenue is measured at the fair value of the consideration received or receivable where the
ownership and significant risk has been transferred to the buyer.

Sales return are accounted for / provided for in the year in which they pertain to, as ascertained till
finalization of the books of account.

Compensation on account of crop quality discounts is accounted for as and when settled

1.5 Taxation: -
INCOME TAX:-

Provision for Current Tax is made and retained in the accounts on the basis of estimated tax liability as
per applicable provisions of the Income Tax Act 1961.

DEFERRED TAX:-

Deferred tax is recognized on temporary differences between the carrying amounts of assets
and liabilities in the financial statements and the corresponding tax bases used in the
computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable
temporary differences. Deferred tax assets are generally recognized 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 utilized. Such deferred tax assets and liabilities
are not recognized 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.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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

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

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 period

Current and deferred tax are recognized in profit or loss, except when they relate to items that
are recognized in other comprehensive income or directly in equity, in which case, the current
and deferred tax are also recognized 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.

The Company recognizes interest levied and penalties related to Income Tax assessments in the
tax expanse.

1.6 Earnings per Share:-

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