Accounting Policies of Z-Tech (India) Ltd. Company

Mar 31, 2025

1.01 Basis of Preparation

The financial statements of the Company have been
prepared in accordance with the Generally Accepted
Accounting Principles in India (Indian GAAP), including
the Accounting Standards notified under section 133
of the Companies Act, 2013. The financial statements
have been prepared on accrual basis under the historical
cost convention. The accounting policies adopted in the
preparation of the financial statements are consistent
with those followed in the previous years.

1.02 Current and Non-current classification

The company presents assets and liabilities in the balance
sheet based on current and Non-current classification.

An asset is classified as current when it is-

Expected to be realised or intended to be sold or
consumed in normal operating cycle;

Held primarily for the purpose of trading;

Expected to be realised within twelve months after
the reporting period, or

Cash or Cash equivalent unless restricted from being
exhanged or used to settle a liability for at least
twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when-

It is expected to be settled in normal operating cycle:

It is held primarily for the purpose of trading;

It is due to be settled within twelve months after the
reporting period, or

There is no unconditional right to defer the settlement
of the liability for at least twelve months after the
reporting period.

The company classifies all other liabilities as non-current.

Deferred tax assets and liabilties are classified as non¬
current assets and liabilties.

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

1.03 Use of estimates

The preparation of financial statements are in conformity
with the Accounting Standards which requires Management
to make estimates and assumptions that affect the reported
amount of assets and liabilities and disclosures relating to
the contingent liabilities as on the date of balance sheet and
the reported amount of revenues and expenditures during
the reporting period. The estimates and assumptions used
in the Financial Statements are based upon Management''s
best evaluation of the relevant facts and circumstances as
of the date of the Financial Statements. Examples of such
estimates include useful life of fixed assets, creation of
deferred tax asset, lease rentals and write off of deferred
revenue expenditure. Actual results may differ from
those estimates.

1.04 Inventories

Inventories are valued at cost after providing for
obsolescence and other losses, where considered
necessary and realizable value whichever is less. Cost
includes all charges in bringing the goods to the point of
sale, including octroi and other levies, transit insurance
and receiving charges. Work-in-progress and finished
goods include appropriate proportion of overheads.

1.05 Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise
of cash at bank and in hand and short term investments
with an original maturity of three months or less if any.
Earmarked balances with bank, margin money or security
against borrowings, guarantees and other commitments
,if any shall be treated separately from cash and
cash equivalent

1.06 Cash flow statement

Cash flows are reported using the indirect method,
whereby profit / (loss) before extraordinary items and
tax is adjusted for the effects of transactions of non-cash
nature and any deferrals or accruals of past or future cash
receipts or payments. The cash flows from operating,
investing and financing activities of the Company are
segregated based on the available information.

1.07 Depreciation and amortisation

Depreciation has been provided as per the useful life
of the respective asset by retaining 5% as residual
value in accordance with the Schedule II to the
Companies Act, 2013.

Depreciation on addition to fixed assets is provided on
pro-rata basis from the date the assets are acquired/
installed. Depreciation on sale/deduction from fixed
assets is provided for upto the date of sale, deduction and
discardment as the case may be.

1.08 Revenue recognition
Sale of goods

Sales are recognised, net of returns and trade discounts,
on transfer of significant risks and rewards of ownership
to the buyer, which generally coincides with the delivery of
goods to customers. Sales include excise duty but exclude
sales tax, value added tax and GST. The company follows
the mercantile system of accounting and recognizes the
income and expenditures on accrual basis except in case
of significant uncertainties. Certain items of income such
as insurance claim, market fees refund ,overdue interest
from customers etc have been considered to the extent
the amount is accepted by the parties

Domestic sales are recognized at the point of
dispatches to customers.

Export Sales at the time of issue of Bill of Lading.

1.09 Other income

Interest income is recognised on time proportion basis.

1.10 Tangible fixed assets

Fixed assets are stated at cost less accumulated
depreciation and impairment losses, if any. Cost comprises
the purchase price and any directly attributable cost of
bringing the asset to its working condition for its intended
use, including borrowing cost till commencement of
commercial production, net changes on foreign exchange
contracts,(if capitalization criteria are met). Capital work
in progress is stated at cost. Capital work in progress
includes the cost of fixed assets that are not yet ready for
their intended use, as on the balance sheet date.

1.11 Intangible assets

Intangible assets are carried at cost less accumulated
amortisation and impairment losses, if any. The cost of an
intangible asset comprises its purchase price, including
any import duties and other taxes (other than those
subsequently recoverable from the taxing authorities),
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 / completion
is recognised 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. Amortization is on the basis of Useful
Life that is 20 years for PPP model

1.12 Foreign currency transactions and translations
Initial recognition

Transactions in foreign currencies entered into by
the Company and its integral foreign operations are
accounted at the exchange rates prevailing on the date of
the transaction or at rates that closely approximate the
rate at the date of the transaction.

Measurement of foreign currency monetary items at the
Balance Sheet date

Foreign currency monetary items (other than derivative
contracts) of the Company outstanding at the Balance
Sheet date are restated at the year-end rates.

Exchange differences arising out of these translations are
charged to the Statement of Profit and Loss.

1.13 Government grants, subsidies and export incentives

Export Incentive if any is accounted on accrual basis
except Interest Subsidy which has been accounted for
on receipt basis.

1.14 Investments

Long-term investments (excluding investment
properties), are carried individually at cost less provision
for diminution, other than temporary, in the value of
such investments. Current investments are carried
individually, at the lower of cost and fair value. Cost
of investments include acquisition charges such as
brokerage, fees and duties.

Investment properties are carried individually at cost
less accumulated depreciation and impairment, if any.
Investment properties are capitalised and depreciated
(where applicable) in accordance with the policy stated
for Tangible Fixed Assets. Impairment of investment
property is determined in accordance with the policy
stated for Impairment of Assets.

1.15 Employee benefits

The Company has adopted the Accounting Standard
15- Employee Benefits prescribed under the Companies
(Accounting Standards) Rules, 2006. ''Employee benefits
include provident fund, bonus, superannuation fund,
compensated absences, long service awards and

post-employment medical benefits. The Company''s
obligation towards various employee benefits has been
recognized as follows:

Short Term Employee Benefits

All employee benefits payable wholly within twelve
months of rendering the service are short-term employee
benefits. Benefits such as salaries, wages and bonus wages,
etc, are recognized in the Profit and Loss statement in the
period in which the employee renders the related service.

Defined contribution plans

The Company’s contribution to provident fund are
considered as defined contribution plans and are charged
as an expense as they fall due based on the amount of
contribution required to be made.

1.16 Borrowing costs

Borrowing costs include interest, amortisation of
ancillary costs incurred and exchange differences arising
from foreign currency borrowings to the extent they are
regarded as an adjustment to the interest cost. Costs in
connection with the borrowing of funds to the extent
not directly related to the acquisition of qualifying
assets are charged to the Statement of Profit and Loss
over the tenure of the loan. Borrowing costs, allocated
to and utilised for qualifying assets, pertaining to the
period from commencement of activities relating to
construction / development of the qualifying asset upto
the date of capitalisation of such asset is added to the
cost of the assets.

Borrowing cost attributable to the fixed assets during
construction/ exploration, renovation and modernization
are capitalized. Such borrowing costs are apportioned on
the average balance of capital work in progress for the
year. Other borrowing costs are recognized as an expense
in the period in which they are incurred.

1.17 Segment reporting

The Company identifies primary segments based on
the dominant source, nature of risks and returns and
the internal organisation and management structure.
The operating segments are the segments for which
separate financial information is available and for which
operating profit/loss amounts are evaluated regularly by
the executive Management in deciding how to allocate
resources and in assessing performance. However the
company is currently dealing in only one primary segment..

1.18 Taxes on income

Tax expense comprises current and deferred tax. Current
income tax is measured at the amount expected to be paid
to the tax authorities in accordance with Income Tax Act,
1961. Deferred income tax reflects the impact of current

year timing differences between taxable income that
originates in one period and are capable of reversal in one
or more subsequent periods

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 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 probable that future economic benefit associated with
it will flow to the Company.

Deferred tax is recognised on timing differences, being
the differences between the taxable income and the
accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred tax is measured using the tax rates and the tax
laws enacted or substantially enacted as at the reporting
date. Deferred tax liabilities are recognised for all timing
differences. Deferred tax assets in respect of unabsorbed
depreciation and carry forward of losses are recognised
only if there is virtual certainty that there will be sufficient
future taxable income available to realise such assets.
Deferred tax assets are recognised for timing differences
of other items only to the extent that reasonable certainty
exists that sufficient future taxable income will be
available against which these can be realised. Deferred
tax assets and liabilities are offset if such items relate to
taxes on income levied by the same governing tax laws
and the Company has a legally enforceable right for such
set off. Deferred tax assets are reviewed at each Balance
Sheet date for their realisability.

1.19 Impairment of assets

The carrying values of assets / cash generating units are
reviewed at each Balance Sheet date for impairment.
If any indication of impairment exists, the recoverable
amount of such assets is estimated and impairment is
recognised if the carrying amount of these assets exceeds
their recoverable amount. The recoverable amount is the
greater of the net selling price and their value in use. Value
in use is arrived at by discounting the future cash flows
to their present value based on an appropriate discount
factor. When there is indication that an impairment loss
recognised for an asset in earlier accounting periods
no longer exists or may have decreased, such reversal
of impairment loss is recognised in the Statement of
Profit and Loss.