|620| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Assets/Disposal Group Reportable Segment Non-current Assets (L&T Financial Consultants Limited) Financial services Current Assets (L&T Vision Ventures Limited) Others (b) The Group has following non-current assets/disposal group recognised as held for sale as on March 31, 2018: Assets/Disposal Group Reportable Segment Port operation (Marine Infrastructure Developer Private Limited) Developmental Projects Non-current Assets (L&T Financial Consultants Limited) Financial Services Current Assets (L&T Vision Ventures Limited) Others (c) The proposed sale are expected to be completed within 1 year from the respective reporting dates. (d) The details of assets/ disposal group classified as held for sale and liabilities associated thereto are as under: ` crore Particulars As at 31-3-2019 As at 31-3-2018 Group(s) of assets classified as held for sale: 1.17 1464.24 Property, Plant and Equipment Other Intangible assets – 0.58 Inventories – 0.48 Trade receivable – 2.50 Cash and cash equivalents – 0.18 Other assets 6.24 44.45 Total 7.41 1512.43 Liabilities associated with group(s) of assets classified as held for sale: – 0.90 Provisions Tax liabilities (Net) – 1.38 Other liabilities 3.20 1459.69 Total 3.20 1461.97 Note [66] Subsequent to the year under review, the Company has divested its entire stake in L&T Kobelco Machinery Private Limited (part of Others Segment) to Kobe Steel, Ltd. on April 17, 2019. Since the criteria for classifying the said investment as held for sale is not met as at reporting date, the same has not been classified as held for sale in the consolidated financial statements. 12. OIL AND NATURAL GAS CORPORATION LIMITED Non-current assets or disposal groups classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell. Non-current assets or disposal groups are classified as held for sale if their carrying amounts will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification as held for sale, and actions required to complete the plan of sale should indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.
|621| Chap. 25 – Ind AS 105- ‘Non-current Assets Held for Sale and Discontinued Operations’ Property, Plant and Equipment (PPE) and intangible assets are not depreciated or amortized once classified as held for sale 24 Assets classified as held for sale (` in million) Particulars As at March 31, 2019 As at March 31, 2018 CWIP Asset - Hazira Dahej Naphtha Pipeline (HDNPL) (Refer note 24.1) 1,154.40 - Other Assets 124.26 76.89 Total Assets held for sale 1,278.66 76.89 24.1 During the year, the Company has classified CWIP Asset - under construction "Hazira Dahej Naphtha Pipeline (HDNPL)" of ` 1,154.40 million as "Assets classified as held for sale” subsequent to Heads of Agreement entered between the Company and Joint venture Company ONGC Petro additions Limited (OPaL), wherein OPaL agreed to take over the project from the Company subject to respective Board approvals and execution of definitive agreement on or before June 30, 2019. The assets are presented within total assets of the onshore segment. 24.2 In respect of subsidiary PMHBL, company intends to dispose of surplus materials used for the pipeline laying project, it no longer utilizes in the next 12 months. These materials are located at various project sites and were purchased for use during construction of pipeline. Efforts are underway to dispose of the project surplus materials to oil companies. The Management of the Group expects that, the fair value (less cost to sell) is higher than the carrying amount. 13. PC JEWELLER LIMITED Disclosure Disclosure pursuant to Ind AS 105 ‘Non-Current Assets Held for Sale and Discontinued Operations’ a) Description of the disposal group The Parent Company is having two core business verticals viz. Domestic Division and Export Division. The Board of the Parent Company has decided to demerge the export division of PC Jeweller Limited and subsequent amalgamation of the same with it’s newly incorporated wholly owned subsidiary company i.e. PCJ Gems & Jewellery Limited. The net worth of the export division as on 31 March 2019 is ` 1,564.30 crores. The turnover of the export division for the year ended 31 March 2019 is ` 1,439.48 crores which represents 20.77% of the Parent Company’s turnover. b) Description of facts and circumstances leading to the expected disposal, and the expected manner and timing of the disposal In the view of the Board the commercial activities of the two verticals are distinct and diverse from each other and in order to ensure sustainable long term growth, profitability, market share and continuous customer service both require focused management attention, different sets of skills and resources to meet competitive, regulatory environment and to mitigate risks. With these objectives in mind, it was proposed to demerge the “Export Division” of the Company into a separate entity. Thus, the Company would be able to revise its business plans and priorities from time to time, thereby ensuring speedy and profitable growth of the two businesses and enhance shareholder’s wealth.
|622| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts 14. RAYMOND LIMITED Significant Accounting Policies Non-current assets held for sale Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee benefits, financial assets and contractual rights under insurance contracts, which are specifically exempt from this requirement. Non-current assets are not depreciated or amortised while they are classified as held for sale. Disclosures Note 13 - Asset classified as heLd for sale (` in lakhs) Particulars As at 31st March, 2019 As at 31st March, 2018 Plant & equipments - 6.56 Freehold land 35.47 - Buildings 70.28 - Total 105.75 6.56 J K Files (India) Limited, a subsidiary has closed its plant at Kolkatta during the year ended 31 March 2018, pursuant to which the subsidiary is in process of sale its land and building at Kolkatta which has been classified as asset held for sale. The land and building are carried at book value in accordance with ‘Ind AS 105 - Non current asset held for sale and discontinued operations’ being lower than the fair value less cost to sell. Note 41 - Discontinued operation Subsidiaries of RUDPL ( Joint Venture of group), UCO Sportswear International NV (USI) and UCO Fabrics Inc. (UFI), had discontinued their operations in 2008. The disclosures with respect to these discontinuing operations are as under: (` in lakhs) Subsidiaries of Raymond uco denim Private Limited 2018-19 2017-18 Group’s share of total Assets at the close of the year 2.32 2.32 15. SHOPPERS STOP LIMITED Disclosure Discontinued Operations The Board of Directors of Gateway Multichannel Retail (India) Limited (Gateway), a subsidiary of SSL had decided to discontinue operation in January 2009. SSL has committed to provide the necessary level of support, to enable Gateway to remain in existence and continue as a going concern. During the year ended 31 March 2018, the Company disposed off 77,158,778 equity shares of `10/- each constituting 51.09% of the share capital of Hypercity Retail (India) Ltd; its material subsidiary to Future Retail Limited on November 30, 2017. Accordingly, Hypercity ceases to be subsidiary of the Company. Refer note 35(a)
|623| Chap. 25 – Ind AS 105- ‘Non-current Assets Held for Sale and Discontinued Operations’ Further, during the year ended 31 March 2018, the Company has disposed off its 40% and 48.42% shareholding in Nuance Group (India) Ltd. (NGIPL) and Timezone Entertainment Private Limited (TEPL). Accordingly, NGIPL and TEPL ceases to be joint ventures of the Company. Refer note 35(b) Statement showing the revenue and expenses of discontinued operations: Particulars 31 March 2019 31 March 2018 Revenue - 73,096.64 Other Income 0.20 2,602.86 Total Revenue 0.20 75,699.50 Operating Expenses 1.45 81,781.84 Loss before tax from discontinued operations (1.25) (6,082.34) Share of Profit/(Loss) in Joint Ventures - 143.12 Loss before tax from discontinued operations (1.25) (5,939.22) Income tax - - (Loss) after tax from discontinued operations (attributable to owners of the Company) (1.25) (5,939.22) The major classes of assets and liabilities of discontinued operations is as follows: Particulars 31 March 2019 31 March 2018 Non-current assets 26.27 26.25 Current assets 3.46 3.91 Non-current liabilities 2,201.66 2,201.66 Current liabilities 41.20 40.38 Carrying value of Group’s interest in Joint Ventures (Refer note 35 (b)(ii) - - Equity attributable to owners of the Company - - Non-controlling interests - - Cash flows from discontinued operations 31 March 2019 31 March 2018* Net cash inflow / (outflow) from operating activities 0.11 2,384.34 Net cash inflow / (outflow) from investing activities 0.20 (125.18) Net cash inflow / (outflow) from financing activities - (699.88) Net cash inflows 0.31 1,559.28 * Hypercity cashflow considered till 30 November’2017 16. SIYARAM SILK MILLS LIMITED Significant Accounting Policies Non-current assets held for sale and discontinued operations Non-current assets (including disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. Non-current assets classified as held for sale are measured at lower of their carrying amount and fair value less cost to sell.
|624| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Non-current assets classified as held for sale are not depreciated or amortised from the date when they are classified as held for sale. Non-current assets classified as held for sale and the assets and liabilities of a disposal group classified as held for sale are presented separately from the other assets and liabilities in the Consolidated Balance Sheet. A discontinued operation is a component of the entity that has been disposed off or is classified as held for sale and: represents a separate major line of business or geographical area of operations and; is part of a single co-ordinated plan to dispose of such a line of business or area of operations. The results of discontinued operation are presented separately in the Consolidated Statement of Profit and Loss. Disclosure Held for sale and discontinued operations Particulars As at March 31, 2019 As at March 31, 2018 (a) Assets classified as held for sale and discontinued operations - 12.65 (i) Assets held for sale (footnote ‘i’) - 1,085.69 (ii) Discontinued operations (footnote ‘ii’) - 1,098.34 (b) Liabilities directly associated with discontinued operations (i) Discontinued operations (footnote ‘ii’) - 549.95 - 549.95 Footnotes: In the previous year, the Group intended to surrender the leasehold land which it no longer intended to utilise. During the year, the Group has filed an application and is in process of obtaining an extension letter for leasehold land as the Group intends to start manufacturing activities, hence management has considered this asset as no longer being assets held for sale and reclassified the same into leasehold land under “property, plant and equipment”. Discontinued operations comprise of assets and liabilities of Phosphatic Fertilisers business and Trading business as at March 31, 2018 (note 34). 17. TATA COFFEE LIMITED Non-Current Assets held for sale and discontinued operations – IND AS 105 Non-current assets held for sale are presented separately in the balance sheet when the following criteria are met: - The Group is committed to selling the asset; - The assets are available for sale immediately; - An active plan of sale has commenced; and - Sale is expected to be completed within 12 months. Assets held for sale and disposal groups are measured at the lower of their carrying amount and fair value less cost to sell. Assets held for sale are no longer amortised or depreciated.
|625| Chap. 25 – Ind AS 105- ‘Non-current Assets Held for Sale and Discontinued Operations’ Note No. 11 - Non Current Assets Held for Sale ` in Lakhs Particulars Timber Property, Plant & Equipment Total As at April 1, 2017 60.34 - 60.34 Additions 170.66 164.71 335.37 Disposals (149.62) - (149.62) As at April 1, 2018 81.38 164.71 246.09 Additions 66.42 - 66.42 Disposals (71.22) (164.71) (235.93) As at March 31, 2019 76.58 - 76.58 The Holding Company intends to dispose off certain Non-Current assets, it no longer utilises in the next 12 months. No impairment loss was recognised on reclassification of the assets as held for sale, as the Holding Company expects that the fair value less costs to sell is higher than the carrying amount. 18. TATA COMMUNICATIONS LIMITED Accounting Policies r. Non-current assets held for sale and discontinued operations Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the asset (or disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such asset (or disposal group) and its sale is highly probable. The Management must be committed to the sale, which should be expected to qualify for recognition as completed sale within one year from the date of classification. When the Group is committed to sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Group will retain a non- controlling interest in its former subsidiary after the sale. Non-current assets held for sale/for distribution to owners and disposal groups are measured at the lower of their carrying amount and the fair value less costs to sell/ distribute. Assets and liabilities classified as held for sale/ distribution are presented separately in the balance sheet. Property, plant and equipment and intangible assets once classified as held for sale/ distribution to owners are not depreciated or amortised. Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss before tax from discontinued operations in the statement of profit and loss. When the Group is committed to a sale plan involving disposal of an investment, or a portion of an investment, in an associate or joint venture, the investment or the portion of the investment that will be disposed of is classified as held for sale when the criteria described above are met, and the Group discontinues the use of the equity method in relation to the portion that is classified as held for sale. Any retained portion of an investment in an associate or a joint venture that has not been classified as held for sale continues to be accounted for using the equity method. The Group discontinues the use of the equity method at the time of disposal when the disposal results in the Group losing significant influence over the associate or joint venture. After the disposal takes place, the Group accounts for any retained interest in the associate or joint venture in accordance with Ind AS 109 unless the retained interest continues to be an associate or a joint venture, in which case the Group uses the equity method (see the accounting policy regarding investments in associates or joint ventures above).
|626| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell. 14. Assets classified as held for sale (` in crores) Particulars As at 31 March 2019 As at 31 March 2018 a. Staff Quarters (Refer a. below) 2.11 2.32 b. Land at Guldhar Repeater Station - 0.45 c. Land and building in Lake Cowichan Site (United States of America) - 3.73 2.11 6.50 a. The Management intends to dispose off a parcel of the Company’s few staff quarters. The Company was only able to partially dispose off its assets classified as held for sale as at 31 March 2018 on account of certain circumstances beyond its control which lead to extension of the period required to complete the sale. An active program is in place to complete the sale and it is expected to be completed in the next 12 months. Accordingly, these assets have been classified as assets held for sale as at 31 March 2019. Further the fair value of these assets is higher than its carrying value as at 31 March 2019 and hence, no impairment loss has been recognized. 19. THE BOMBAY DYEING AND MANUFACTURING COMPANY LIMITED Significant Accounting Policies Discontinued Operations A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed of, or is classified as held for sale, and: Represents a separate major line of business or geographical area of operations. Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations or Is a subsidiary acquired exclusively with a view to resale. Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the statement of profit and loss. Disclosure Discontinued Operations The Company had shareholding of 33.89% in the Joint Venture PT Five Star Textile Indonesia (PTFS). The Company took strategic move to wind up this loss making Joint Venture. With this strategic objective, on July 18, 2018, the Company acquired 3,409 Shares (52.11% Shareholding) in PTFS at a value of ` 3,818 (USD $34). Further, on November 20, 2018, loan amounting to ` 185.48 crores given by the Company to PTFS was converted into equity shares in PTFS. As a result of this conversion, the percentage holding of the Company increased to 97.36%. Upon acquisition, the Company obtained control over PTFS and it became a Subsidiary of the Company, thereby enabling the Company to apply for liquidation as per the laws of Indonesia and winding up process is initiated. Gain has not been recognised by the Company on re-measurement of its previously held equity interest at fair value since the amount of gain is immaterial. Accordingly, in terms of provisions Ind AS 103, Goodwill of ` 92.39 Crores on acquisition is also recognised in Consolidated Financial Statements and subsequently impaired. There is no additional financial exposure. The above Consolidated Assets and Liabilities include assets of ` 2.41 crores and liabilities of ` 0.93 crores of PTFS which is classified as a Discontinued Operation in accordance with Ind AS 105 on “Non-Current Assets Held for Sale and Discontinued Operations”.
|627| Chap. 25 – Ind AS 105- ‘Non-current Assets Held for Sale and Discontinued Operations’ Particulars Year ended March 31, 2019 Analysis of loss for the year from Discontinued Operations Revenue including other income 187.08 Expense (96.59) Impairment of Goodwill (92.39) Loss before Income Tax (1.90) Income Tax - Loss after Income Tax (1.90) Analysis of cash flow from Discontinued Operations Net Cash Flow from Operating activities (36.54) Net Cash Flow from Investing activities 92.56 Net Cash Flow from Financing activities (54.27) Net Cash Flow generated from Discontinued Operations 1.75 20. ULTRATECH CEMENT LIMITED Accounting Policies (g) Non-current assets (or disposal groups) classified as held for sale: To classify any asset or disposal groups (comprising assets and liabilities) as “Asset / Disposal groups held for sale” they must be available for immediate sale and its sale must be highly probable. Such assets or group of assets / liabilities are presented separately in the Balance Sheet, in the line “Assets / Disposal groups held for sale” and “Liabilities included in disposal group held for sale” respectively. Once classified as held for sale, intangible assets and PPE are no longer amortised or depreciated. Such assets or disposal groups held for sale are stated at the lower of carrying amount and fair value less costs to sell. (dd) Discontinued Operations: A discontinued operation is a component of the group’s business, the operations and cashflows of which can be clearly distinguished from those of the rest of the group and which represent a separate major line of business or geographical area of operations and - Is a part of single coordinated plan to dispose of a separate major line of business or geographical area of operations; or - Is a subsidiary acquired exclusively with a view to re-sale. Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria to be classified as held for sale, if earlier. When an operation is classified as a discontinued operation, the comparative Statement of Profit and Loss is represented as if the operation had been discontinued from the start of the comparative period. Disclosures Note 59: Assets / Disposal group held for sale (Ind AS 105) (a) The Group has identified certain assets like Aggregate Mines, Pre Grinders, Vibrating Mill, Naptha based power plant, Waste Heat Recovery System (WHRS) etc., which are available for sale in its present condition. The Group is committed to plan the sale of these assets and an active programme to locate a buyer and complete the plan have been initiated. The Group expects to dispose of these assets within twelve months from its classification. These assets have been stated at fair value less cost to sell (being lower of the carrying amount) amounting to ` 56.30 Crores (March 31, 2018: ` 43.40 Crores). Refer Note 2 for impairment relating to these assets.
|628| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts (b) Consequent to the acquisition of UNCL (refer note 41), the Group has identified disposal groups (foreign subsidiaries of UNCL) that meet the criteria to be classified as held for sale on acquisition, as these are not considered core to the groups ongoing business activities and management is committed to sell these disposal groups, active efforts have been initiated to locate a buyer. The Group expects to sell the disposal group within twelve months from its classification. The disposal group comprises assets held for sale amounting to ` 1,037.20 Crores (March 31, 2018: Nil) and liabilities amounting to ` 489.00 Crores (March 31, 2018: Nil), which have been stated at fair value less cost to sell (being lower of their carrying amount). The disposal group have also been considered as discontinued operations. The non-recurring fair value measurement for the disposal group has been categorised as a level 2 fair value based on the inputs to the valuation technique used. Refer note 1(B)(b)(vii) in respect of the valuation basis used in measuring the fair value of the disposal group. 21. VEDANTA LIMITED Accounting Policies (G) Non-current assets held for sale Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale which should be expected to qualify for recognition as a completed sale within one year from the date of classification. Non-current assets and disposal groups classified as held for sale are not depreciated and are measured at the lower of carrying amount and fair value less costs to sell. Such assets and disposal groups are presented separately on the face of the consolidated balance sheet. 22. WIPRO LIMITED Assets of disposal groups that is available for immediate sale and where the sale is highly probable of being completed within one year from the date of classification are considered and classified as assets held for sale. Non-current assets and disposal groups held for sale are measured at the lower of carrying amount and fair value less costs to sell. ll
|629| Chap. 26 – Ind AS 108 – Operating Segments Chapter 26 Ind AS 108 – Operating Segments 1. APOLLO HOSPITAL ENTERPRISE LIMITED The Group uses the management approach for reporting information about segments in annual financial statements. The management approach is based on the way the Chief Operating Decision maker organises segments within a Group for making an operating decision and assessing performance. Reportable segments are based on services, legal structure, management structure and any other manner in which the management disaggregates a company. Based on the management approach model the Group has determined that its business model is comprised of Clinics and Diagnostics. The Group classifies non-current assets held for sale if their carrying amounts will be principally recovered through a sale rather than through continuing use of assets and action required to complete such sale indicate that it is unlikely that significant changes to the plan to sell will be made or that the decision to sell will be withdrawn. Also, such assets are classified as held for sale only if the management expects to complete the sale within one year from the date of classification. 2. COLGATE PALMOLIVE INDIA LIMITED Operating Segments Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (“CODM”). The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Managing Director and Finance Director of the Company. The Company has identified ‘Personal Care (including Oral Care)’ as its only primary reportable segment, which primarily includes products such as Soaps, Cosmetics and Toilet Preparations. Disclosures Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (“CODM”) of the Company. The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Managing Director and Finance Director of the Company. The Company operates only in one Business Segment i.e. ‘Personal Care (including Oral Care)’ which primarily includes products such as Soaps, Cosmetics and Toilet Preparations and the activities incidental thereto within India, hence does not have any reportable Segments as per Ind AS 108 “Operating Segments”. The performance of the Company is mainly driven by sales made locally and hence, no separate geographical segment is identified. 3. GILLETTE INDIA LIMITED IND AS – 108 - Operating Segments Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM) of the Company. The CODM is responsible for allocating resources and assessing performance of the operating segments of the Company. Disclosures 27.1 Products from which reportable segments derive their revenues Information reported to the chief operating decision maker (CODM) for the purposes of resource allocation and assessment of segment performance focuses on the types of goods delivered. The directors of the
|630| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Company have chosen to organise the Company around differences in products. No operating segments have been aggregated in arriving at the reportable segments of the Company. Specifically, the Company’s reportable segments under Ind AS 108 are as follows: – The grooming segment, produces and sells shaving system and cartridges, blades, toiletries and components. – The oral care segment, produces and sells tooth brushes and oral care products. 4. GRASIM INDUSTRIES LIMITED Identification of Segments Operating Segments are identified based on monitoring of operating results by the chief operating decision maker (CODM) separately for the purpose of making decision about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss, and is measured consistently with profit or loss of the Group. Operating Segment is identified based on the nature of products and services, the different risks and returns, and the internal business reporting system. Segment Policies The Group prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Group as a whole. Further, inter-segment revenue have been accounted for based on the transaction price agreed to between segments, which is primarily market based. Unallocated Corporate Items include general corporate income and expenses, which are not attributable to segments. 4.6 OPERATING SEGMENTS 4.6.1 Details of products included in each of the Segments are as under:- Viscose - Viscose Staple Fibre, Wood Pulp and Viscose Filament Yarn Chemicals - Caustic Soda, Allied Chemicals and Epoxy Cement - Grey Cement, White Cement and Allied Products Financial Services - Non- Bank Financial Services, Life insurance services, Asset Management (AMC), Housing Finance, Equity and broking, Wealth Management, General Insurance Advisory and Health Insurance Others - Mainly Textiles, Insulators, Agri-business and Solar Power Information about Operating Segments for Current Year: (` in Crore) Viscose Chemicals Cement Financial Services Others Eliminations Total REVENUE Sales (As reported) 10,220.26 5,414.60 36,758.00 15,020.67 4,753.62 - 72,167.15 Sales (Inter-Segment) 11.39 957.86 16.69 11.28 23.66 (1,020.88) - Total Sales (Note 3.1) 10,231.65 6,372.46 36,774.69 15,031.95 4,777.28 (1,020.88) 72,167.15 Other Income (including Other Operating Revenues) 120.09 83.05 1,039.25 18.64 57.44 (23.08) 1,295.39 Unallocated Corporate Other Income 309.50 Total Other Income 120.09 83.05 1,039.25 18.64 57.44 (23.08) 1,604.89 Total Revenue 10,351.74 6,455.51 37,813.94 15,050.59 4,834.72 (1,043.96) 73,772.04
|631| Chap. 26 – Ind AS 108 – Operating Segments (` in Crore) Viscose Chemicals Cement Financial Services Others Eliminations Total RESULTS Segment Results (PBIT) 1,667.60 1,588.46 5,086.40 718.31 335.66 0.44 9,396.87 Unallocated Corporate Income/ (Expenses) 162.53 Finance Costs* (1,780.56) Profit before Exceptional Items and Tax 7,778.84 Exceptional Items (Note 3.10) (2,574.52) Profit Before Tax and Share in Profit/(Loss) of Equity Accounted Investees 5,204.32 Share in Profit of Joint Ventures and Associates (Allocable to Operating Segments) 118.86 - 0.19 209.06 1.57 - 329.68 Share in Profit of Joint Ventures and Associates (Unallocable) (300.62) Profit Before Tax 5,233.38 Current Tax 2,357.97 Provision for Tax of Earlier Years Written Back (15.51) Deferred Tax 114.97 Profit for the period before Non-controlling Interest 2,775.95 Less: Non-controlling Interest (1,004.03) Profit for the year 1,771.92 OTHER INFORMATION Segment Assets 9,534.20 5,903.11 66,432.88 129,637.33 6,006.26 (7.24) 217,506.54 Investment in Associates/ Joint Ventures (Allocable to Operating Segments) 1,091.64 - 7.36 4,913.71 30.19 - 6,042.90 Investment in Associates/Joint Ventures (Unallocable) 241.39 Unallocated Corporate Assets 5,411.84 Total Assets 229,202.67 Segment Liabilities 2,030.40 926.55 9,762.32 98,911.89 862.43 (62.91) 112,430.68 Unallocated Corporate Liabilities 33,611.59 Total Liabilities 146,042.27 Additions to Non-Current Assets@ 1,270.34 752.14 6,110.06 155.98 874.53 - 9,163.05 Unallocated Corporate Capital Expenditure 22.92 Total Additions to NonCurrent Assets 9,185.97 Depreciation and Amortisation 384.42 238.87 2,139.80 341.62 142.43 - 3,247.14
|632| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts (` in Crore) Viscose Chemicals Cement Financial Services Others Eliminations Total Unallocated Corporate Depreciation and Amortisation 13.31 Total Depreciation and Amortisation 3,260.45 Significant Non-Cash Expenses other than Depreciation and Amortisation (Allocable) - - - 94.01 135.00 - 229.01 Significant Non-Cash Expenses other than Depreciation and Amortisation (Unallocable) 2,345.51 * Finance cost excludes finance cost of ` 4,050.18 Crore on financial services business, since it is considered as an expense for deriving segment result. @ also includes addition on account of acquisition of UNCL, controlling stake in ABREL & ABSL and Grasim Premium Fabrics Private Limited. Transfer prices between operating segments are on an arm’s length basis in a manner similar to transactions with third parties. Information about Operating Segments for Previous Year: Viscose - Viscose Staple Fibre, Wood Pulp and Viscose Filament Yarn Chemicals - Caustic Soda, Allied Chemicals and Epoxy Cement - Grey Cement, White Cement and Allied Products Financial Services - Non- Bank Financial Services, Life insurance services, Housing Finance, Asset Management, Private Equity, Equity and Commodity broking, Wealth Management, General Insurance Advisory and Health Insurance (w.e.f 1st July 2017) Others - Mainly Textiles, Insulators, Agri - business and Solar Power (w.e.f 1st July 2017) (` in Crore) Viscose Chemicals Cement Financial Services Others Eliminations Total REVENUE Sales (As reported) 8,442.57 4,156.86 31,423.11 9,074.77 3,317.56 - 56,414.87 Sales (Inter-Segment) 16.56 879.40 11.90 8.11 0.30 (916.27) - Total Sales (Note 3.1) 8,459.13 5,036.26 31,435.01 9,082.88 3,317.86 (916.27) 56,414.87 Other Income (including Other Operating Revenues) 120.29 82.76 995.76 3.41 70.47 (21.66) 1,251.03 Unallocated Corporate Other Income 228.44 Total Other Income 120.29 82.76 995.76 3.41 70.47 (21.66) 1,479.47 Total Revenue 8,579.42 5,119.02 32,430.77 9,086.29 3,388.33 (937.93) 57,894.34 RESULTS Segment Results (PBIT) 1,383.75 1,088.20 4,885.80 512.43 197.72 9.18 8,077.08 Unallocated Corporate Income/ (Expenses) 81.93 Finance Costs* (1,363.98) Profit before Exceptional Items and Tax 6,795.03 Exceptional Items (Note 3.10) (432.85)
|633| Chap. 26 – Ind AS 108 – Operating Segments (` in Crore) Viscose Chemicals Cement Financial Services Others Eliminations Total Profit Before Tax and Share in Profit/(Loss) of Equity Accounted Investees 6,362.18 Share in Profit of Joint Ventures and Associates (allocable to operating segments) 120.09 - (0.13) 127.50 (1.25) - 246.21 Share in Profit of Joint Ventures and Associates (Unallocable) (973.65) Profit Before Tax 5,634.74 Current Tax 1,831.69 Provision for Tax of Earlier Years Written Back (97.86) Deferred Tax 213.29 Profit for the period before Noncontrolling Interest 3,687.62 Less: Non-controlling Interest (1,009.04) Profit for the year 2,678.58 OTHER INFORMATION Segment Assets 8,419.36 5,240.37 58,876.88 114,174.83 4,122.04 (57.26) 190,776.22 Investment in Associates/ Joint Ventures (Allocable to Operating Segments) 1,073.41 10.81 4,886.97 - 5,971.19 Investment in Associates/Joint Ventures (Unallocable) 7,961.49 Unallocated Corporate Assets 3,211.18 Total Assets 207,920.08 Segment Liabilities 1,521.53 1,008.17 8,090.42 83,994.55 953.66 (66.16) 95,502.17 Unallocated Corporate Liabilities 28,719.18 Total Liabilities 124,221.35 Additions to Non-Current Assets@ 1,247.18 553.61 18,287.64 138.38 56.88 - 20,283.69 Unallocated Corporate Capital Expenditure 14.00 Total Additions to Non-Current Assets 20,297.69 Depreciation and Amortisation 296.24 211.77 1,847.93 243.45 111.45 - 2,710.84 Unallocated Corporate Depreciation and Amortisation 13.52 Total Depreciation and Amortisation 2,724.36 Significant Non-Cash Expenses other than Depreciation and Amortisation (Allocable) - 30.43 346.60 25.00 87.68 - 489.71 Significant Non-Cash Expenses other than Depreciation and Amortisation (Unallocable) (56.86) * Finance cost excludes finance cost of ` 2,299.19 Crore on financial services business, since it is considered as an expense for deriving segment result.
|634| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts @ also includes addition on account of acquisition of JAL& JCCL, merger of ABNL and acquisition of rights to manage and operate VFY business of CTIL. Transfer prices between operating segments are on an arm’s length basis in a manner similar to transactions with third parties. 4.6.2 Geographical Segments The Company’s Operating Facilities are located in India. (` in Crore) Current Year Previous Year Segment Revenues: India 70,207.31 54,492.61 Rest of the World 1,959.84 1,922.26 Total 72,167.15 56,414.87 Addition to Non-Current Assets $ India 9,101.52 20,139.96 Rest of the World 61.53 143.73 Total 9,163.05 20,283.69 4.6.3 The Carrying Amount of Non-Current Operating Assets by location of Assets: (` in Crore) As at 31st March 2019 Ast at 31st March 2018 Non-Current Assets$ India 80,575.65 72,706.61 Rest of the World 2,313.81 2,252.28 Total 82,889.46 74,958.89 $ Non-current assets excludes Financial Assets, Equity Accounted Investees, Deferred tax assets and Noncurrent tax assets) 4.6.4 Information about Major Customers No Single customer represents 10% or more of the Group total Revenue for the year ended 31st March 2019 and year ended 31st March 2018. 5. IRB INFRASTRUCTURE DEVELOPERS LIMITED a) Significant Accounting Policies 3.26 Segment information Based on “Management Approach” as defined in Ind AS 108 - Operating Segments, the Management (“the Board of Directors”) evaluates the Group’s performance and allocates the resources based on an analysis of various performance indicators by business segments. Inter segment sales and transfers are reflected at market prices. Unallocable items includes general corporate income and expense items which are not allocated to any business segment. Segment Policies The Group prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Group as a whole. Common allocable costs are allocated to each segment on an appropriate basis.
|635| Chap. 26 – Ind AS 108 – Operating Segments Note 36 : Segment Information: a) The Group has identified business segments in accordance with Indian Accounting Standard 108 “Operating Segment” notified under section 133 of the Companies Act 2013, read together with relevant rules issued thereunder. b) The Group has identified two business segments viz., Built, Operate and Transfer (‘BOT’) and Construction as reportable segments. The business segments of the Group comprise of the following: Segment BOT Projects Construction c) The Group's activities are restricted within India and hence no separate geographical segment disclosure is considered necessary. d) Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. e) Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively. f) Details of Business Segment information is presented below: (` in millions) Particulars BOT Projects Construction Unallocated corporate Total 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 Revenue Total external revenue 20,847.54 18,206.81 46,018.56 38,555.98 204.09 178.20 67,070.18 56,940.99 Inter segment revenue - - - - - - - - Total Revenue (Net) 20,847.54 18,206.81 46,018.56 38,555.98 204.09 178.20 67,070.18 56,940.99 Result Segment Results 13,304.22 10,485.14 11,110.85 11,096.64 93.50 (49.46) 24,508.57 21,532.32 Unallocated corporate expenses (530.75) (179.13) Operating Profit 23,977.82 21,353.19 Other Income 1,956.00 1,686.68 Unallocated financial expenses (11,200.58) (9,666.68) Profit Before Exceptional items and Tax 14,733.24 13,373.19 Exceptional items - 1,266.90 Profit Before Tax 14,733.24 14,640.09 Current Tax 6,192.62 5,711.92 Deferred Tax 40.97 (268.40) Profit after tax and before non-controlling interest 8,499.65 9,196.57 Less: Non-controlling interests - - Profit for the year 8,499.65 9,196.57
|636| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Particulars BOT Projects Construction Unallocated corporate Total 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 Other Information Segment assets 333,825.77 332,134.49 39,800.65 39,609.80 31,334.33 32,287.84 404,960.75 404,032.13 Segment liabilities 148,447.90 189,559.87 21,534.20 15,484.65 171,827.16 142,062.43 341,809.27 347,106.95 Capital expenditure incurred 41,847.85 39,259.36 341.05 400.76 - - 42,188.90 39,660.12 Depreciation and Amortisation 4,940.49 4,747.54 421.42 654.63 33.21 38.28 5,395.13 5,440.45 Footnotes:- 1. Unallocated corporate assets includes current and non-current investments, goodwill, deferred tax assets, cash and bank balances and advance payment of income tax. 2. Unallocated corporate liabilities includes long term borrowings, short term borrowings, current maturities of long term borrowing, deferred tax liability and provision for taxation. 3. Unallocated corporate under segment revenue and segment results includes Real Estate Development, Windmill (Sale of electricity generated by windmill), Hospitality and Airport Infrastructure. 6. KANSAI NEROLAC PAINTS LIMITED Segment Reporting The Management Committee of the Holding Company, approved by the Board of Directors and Audit Committee performs the function of allotment of resources and assessment of performance of the Group. Considering the level of activities performed, frequency of their meetings and level of finality of their decisions, the Holding Company has identified that Chief Operating Decision Maker function is being performed by the Management Committee. The financial information presented to the Management Committee in the context of results and for the purposes of approving the annual operating plan is on a consolidated basis for various products of the Group. As the Group’s business activity falls within a single business segment viz. ‘Paints’ and the sales substantially being in the domestic market, the financial statement are reflective of the information required by Ind AS 108 “Operating Segments”. As the Group mainly caters to the domestic market in India, the total overseas turnover is 4.63% (2017-18 1.51%) of the total turnover of the Group, which is insignificant and thus a separate geographical segment information has not been given in the Consolidated Financial Statements. 7. LARSEN & TOUBRO LIMITED a) Significant Accounting Policies (y) Accounting and reporting of information for operating segments operating segments are those components of the business whose operating results are regularly reviewed by the chief operating decision making body in the Group to make decisions for performance assessment and resource allocation. the reporting of segment information is the same as provided to the management for the purpose of the performance assessment and resource allocation to the segments. segment accounting policies are in line with the accounting policies of the Group. in addition, the following specific accounting policies have been followed for segment reporting: (i) segment revenue includes sales and other operational revenue directly identifiable with/allocable to the segment including (a) inter-segment revenue and (b) profit on sale of stake in the subsidiary and/ or joint venture companies under developmental projects segment and Realty business grouped under “others” segment
|637| Chap. 26 – Ind AS 108 – Operating Segments (ii) expenses that are directly identifiable with/allocable to segments are considered for determining the segment result. in respect of (a) Financial services segment and (b) Power Generation projects under developmental Projects segment which are classified as assets given on finance lease, the finance costs on borrowings are accounted as segment expenses. (iii) most of the centrally incurred costs are allocated to segments mainly on the basis of their respective expected segment revenue estimated at the beginning of the reported period. (iv) income which relates to the Group as a whole and not allocable to segments is included in “unallocable corporate income”. (v) segment result includes margins on inter-segment capital jobs, which are reduced in arriving at the profit before tax of the Group. (vi) segment result includes the finance costs incurred on interest bearing advances with corresponding credit included in “unallocable corporate income”. (vii) segment results have not been adjusted for the exceptional item attributable to the corresponding segment. the said exceptional item has been included in “unallocable corporate income net of expenditure”. the corresponding segment assets have been carried under the respective segments without adjusting the exceptional item. (viii) segment assets and liabilities include those directly identifiable with the respective segments. in respect of (a) Financial services segment, and (b) Power Generation projects under developmental Projects segment which are classified as assets given on finance lease, segment liabilities include borrowings as the finance costs on borrowings are accounted as segment expenses in respect of the segment and projects. investment in joint ventures and associates identified with a particular segment are reported as part of the segment assets of those respective segments. Unallocable corporate assets and liabilities represent the assets and liabilities that relate to the Group as a whole. (ix) segment non-cash expenses forming part of segment expenses includes the fair value of the employee stock options which is accounted as employee compensation cost [see note 1(w) above] and is allocated to the segment. (x) segment revenue resulting from transactions with other business segments is accounted on the basis of transfer price which are either determined to yield a desired margin or agreed on a negotiated basis. b) Notes to Accounts Note [46] Disclosure pursuant to Ind AS 108 “Operating Segment” (a) Information about Reportable segments ` crore For the year ended 31-3-2019 For the year ended 31-3-2018 External Intersegment Total Intersegment External Total Revenue 72418.05 785.71 73203.76 62286.62 1130.29 63416.91 Infrastructure Power 3971.50 11.59 3983.09 6200.58 7.65 6208.23 Heavy Engineering 2174.22 339.44 2513.66 1391.60 243.47 1635.07 Defence Engineering 3751.96 97.28 3849.24 3214.44 5.62 3220.06 Electrical & Automation Note 42(c)] 5786.81 306.82 6093.63 5209.03 299.24 5508.27 Hydrocarbon 15131.58 44.65 15176.23 11735.83 23.80 11759.63
|638| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts For the year ended 31-3-2019 For the year ended 31-3-2018 External Intersegment Total Intersegment External Total IT & Technology Services 14371.36 181.74 14553.10 11187.79 169.64 11357.43 Financial Services 12637.69 – 12637.69 10063.75 – 10063.75 Developmental Projects 5068.04 – 5068.04 4294.05 – 4294.05 Others 5695.88 239.10 5934.98 4278.41 165.79 4444.20 Elimination – (2006.33) (2006.33) – (2045.50) (2045.50) Total 141007.09 – 141007.09 119862.10 – 119862.10 Segment result [Profit/(Loss) before interest and tax] Infrastructure 5388.77 5440.08 Power 129.88 163.99 Heavy Engineering 487.01 205.21 Defence Engineering 472.22 120.38 Electrical & Automation [Note 42(c)] 850.09 668.82 Hydrocarbon 1178.10 771.81 IT & Technology Services 3084.20 2146.51 Financial Services 3052.64 1440.64 Developmental Projects 314.35 196.40 Others 776.20 1182.57 Total 15733.46 12336.41 Inter-segment margins on capital jobs (5.50) 12.90 Finance costs (1806.04) (1538.52) Unallocated corporate income net of expenditure 659.00 828.37 Profit before Tax 14580.92 11639.16 Provision for current tax (4693.33) (3732.27) Provision for deferred tax 349.99 533.40 Profit after tax 10237.58 8440.29 Share in profit/(loss) of joint venture/associate companies (net) (21.00) (435.86) Adjustments for noncontrolling interests in subsidiaries (1311.45) (634.57) Net profit after tax, noncontrolling interests and share in profit/(loss) of joint ventures/associates 8905.13 7369.86 ` crore Particulars Segment Assets Segment Liabilities As at 31-3-2019 As at 31-3-2018 As at 31-3-2019 As at 31-3-2018 Infrastructure 74848.71 65485.32 50908.92 43235.53 Power 6030.51 6491.79 4838.09 5647.48 Heavy Engineering 4614.54 3962.73 2111.79 1541.48
|639| Chap. 26 – Ind AS 108 – Operating Segments Particulars Segment Assets Segment Liabilities As at 31-3-2019 As at 31-3-2018 As at 31-3-2019 As at 31-3-2018 Defence Engineering 7826.76 7734.33 4964.28 4618.63 Electrical & Automation [Note 42(c)] 4458.66 4449.55 2178.18 2139.88 Hydrocarbon 12224.57 9226.17 10096.59 7841.04 IT & Technology Services 9647.21 7568.14 2575.96 2187.10 Financial Services 104842.19 86088.63 92973.64 76390.47 Developmental Projects 31191.27 30375.07 9560.38 11109.86 Others 9819.89 10576.54 3936.13 2975.92 Segment Total 265504.31 231958.27 184143.96 157687.39 Corporate unallocated assets/liabilities 15890.10 14329.15 28049.54 28495.10 Inter-segment assets/liabilities (2260.34) (2409.97) (2260.34) (2409.97) Consolidated Total assets/liabilities 279134.07 243877.45 209933.16 183772.52 (a) Information about Reportable segments (contd.) ` crore Particulars Depreciation, amortization, impairment & obsolescence included in segment expense Non-cash expenses other than depreciation included in segment expense 2018-19 2017-18 2018-19 2017-18 Infrastructure 764.59 683.64 46.40 22.86 Power 47.16 43.56 2.99 1.40 Heavy Engineering 44.95 87.47 2.19 1.06 Defence Engineering 134.03 141.44 2.59 0.95 Electrical & Automation [Note 42(c)] 161.63 152.74 6.37 3.85 Hydrocarbon 151.83 132.41 7.82 3.66 IT & Technology Services 251.34 244.43 7.25 8.47 Financial Services 49.01 51.23 68.15 29.43 Developmental Projects 207.22 73.68 – – Others 96.77 115.42 1.46 1.29 Segment Total 1908.53 1726.02 145.22 72.97 Unallocable 175.47 202.71 12.75 38.42 Consolidated Total 2084.00 1928.73 157.97 111.39 Note : Impairment loss included in segment expense: Heavy Engineering Segment R Nil (previous year: ` 31.88 crore), Developmental Projects Segment ` 127.94 crore (previous year: R Nil), Other segment ` 2.08 crore (previous year: ` 27.69 crore) and Corporate Unallocated ` 146.93 crore (previous year: ` 84.32 crore). ` crore Interest Income included in segment income Finance costs included in segment expense Profit or (loss) of associates and joint ventures accounted applying equity method not included in segment result 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 Infrastructure 6.37 2.95 297.87 236.90 0.96 2.44 Power – – – – 183.60 164.45 Heavy Engineering – – – – (156.81) (227.96)
|640| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Interest Income included in segment income Finance costs included in segment expense Profit or (loss) of associates and joint ventures accounted applying equity method not included in segment result 2018-19 2017-18 2018-19 2017-18 2018-19 2017-18 Defence Engineering 1.29 0.48 – – 0.40 0.06 Electrical & Automation [Note 42(c)] 6.61 5.29 – – – – Hydrocarbon 244.92 119.43 – – 17.70 29.72 IT & Technology Services 5.20 4.04 – – – – Financial Services 286.25 215.74 6859.46 5449.67 – 0.70 Developmental Projects 1.17 0.54 599.54 627.53 (90.38) (392.85) Others 66.57 53.62 – – 6.24 2.98 Segment Total 618.38 402.09 7756.87 6314.10 (38.29) (420.46) Unallocable 629.65 518.66 (297.87) (236.90) 17.29 (15.40) Inter-segment (347.45) (255.08) (73.37) (57.46) – – Consolidated Total 900.58 665.67 7385.63 6019.74 (21.00) (435.86) (a) Information about Reportable segments (contd.) ` crore Additions to non-current assets Investment in associates and joint ventures accounted applying equity method included in segment assets 2018-19 2017-18 As at 31-3-2019 As at 31-3-2018 Infrastructure 1251.62 1516.19 4.70 8.95 Power 62.96 133.40 933.37 774.53 Heavy Engineering 76.76 41.25 – – Defence Engineering 219.15 229.40 6.36 5.96 Electrical & Automation [Note 42(c)] 258.30 202.16 – – Hydrocarbon 386.99 399.29 394.60 359.92 IT & Technology Services 667.31 512.16 – – Financial Services 860.12 351.39 – – Developmental Projects 2938.11 2461.60 1275.49 1310.94 Others 629.99 410.14 26.93 20.73 Segment Total 7351.31 6256.98 2641.45 2481.03 Unallocable 228.58 457.28 0.84 0.56 Inter-segment (105.29) (74.61) – – Consolidated Total 7474.60 6639.65 2642.29 2481.59 (b) Geographical Information ` crore Particulars Revenues by location of customers 2018-19 2017-18 India (a) 95898.05 80162.78
|641| Chap. 26 – Ind AS 108 – Operating Segments Particulars Revenues by location of customers 2018-19 2017-18 Foreign countries (b): United States of America 8826.86 7355.33 Kingdom of Saudi Arabia 6575.22 8053.68 Sultanate of Oman 3031.69 4485.12 United Arab Emirates 6306.93 3866.38 Kuwait 1672.07 2174.35 Qatar 4146.69 5335.10 Other countries 14549.58 8429.36 Total Foreign countries (b) 45109.04 39699.32 Total (a+b) 141007.09 119862.10 Particulars Non-current Assets As at 31-3-2019 As at 31-3-2018 India 38648.64 35096.97 Foreign countries 2113.39 1680.43 Total 40762.03 36777.40 (c) Revenue contributed by any single customer in any of the operating segments, whether reportable or otherwise, does not exceed ten percent of the group’s total revenue. (d) The group’s reportable segments are organized based on the nature of products and services offered by these segments. (e) Segment reporting: basis of identifying operating segments, reportable segments and definition of each reportable segment: (i) Basis of identifying Operating segments: Operating segments are identified as those components of the group (a) that engage in business activities to earn revenues and incur expenses (including transactions with any of the group’s other components); (b) whose operating results are regularly reviewed by the Group’s Corporate Executive Management to make decisions about resource allocation and performance assessment; and (c) for which discrete financial information is available. The group has nine reportable segments [described under “segment composition”] which are the group’s independent businesses. The nature of products and services offered by these businesses are different and are managed separately given the different sets of technology and competency requirements. In arriving at the reportable segment, the seven operating segments have been aggregated and reported as “infrastructure segment” as these operating segments have similar economic characteristics in terms of long term average gross margins, nature of the products and services, type of customers, methods used to distribute the products and services and the nature of regulatory environment applicable to them. (ii) Reportable segments An operating segment is classified as Reportable segment if reported revenue (including intersegment revenue) or absolute amount of result or assets exceed 10% or more of the combined total of all the operating segments. (iii) Performance of a segment is measured based on segment profit (before interest and tax), as included in the internal management reports that are reviewed by the Group’s Corporate Executive Management. The performance of financial services segment and finance lease activities of power
|642| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts development segment are measured based on segment profit (before tax) after deducting the interest expense. (iv) Segment composition • Infrastructure segment comprises engineering and construction of building and factories, transportation infrastructure, heavy civil infrastructure, power transmission & distribution, water and effluent treatment, smart world & communication projects and metallurgical & material handling systems. • Power segment comprises turnkey solutions for Coal-based and Gas-based thermal power plants including power generation equipment with associated systems and/or balance-of-plant packages. • Heavy Engineering segment comprises manufacture and supply of custom designed, engineered critical equipment & systems to core sector industries like Fertiliser, Refinery, Petrochemical, Chemical, Oil & Gas and Thermal & Nuclear Power. • Defence Engineering segment comprises design, development, prototyping, serial production, delivery, commissioning and through life-support of equipment, systems and platforms for Defence and Aerospace sectors. It also includes Defence Shipbuilding comprising design, construction, commissioning, repair/refit and upgrades of Naval and Coast Guard vessels. • Electrical & Automation segment comprises manufacture and sale of low and medium voltage switchgear components, custom built low and medium voltage switchboards, electronic energy meters/protection (relays) systems and control & automation products. • Hydrocarbon segment comprises complete EPC solutions for the global Oil & Gas Industry from front-end design through detailed engineering, modular fabrication, procurement, project management, construction, installation and commissioning. • IT & Technology Services segment comprises information technology and integrated engineering services. • Financial Services segment comprises rural finance, housing finance, wholesale finance, mutual fund and wealth management. • Developmental projects segment comprises development, operation and maintenance of basic infrastructure projects, toll and fare collection, power development, development and operation of port facilities (till the date of sale) and providing related advisory services. • Others segment includes realty, manufacture and sale of industrial valves, welding equipment and cutting tools (till the date of sale), manufacture, marketing and servicing of construction equipment and parts thereof, marketing and servicing of mining machinery and parts thereof, manufacture and sale of rubber processing machinery, mining and aviation. None of the businesses reported as part of others segment meet any of the quantitative thresholds for determining reportable segments for the year ended March 31, 2019. 8. TATA CHEMICALS LIMITED Significant Accounting Policies Segment reporting 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 Managing Director and Chief Executive Officer (who is the Group’s chief operating decision maker) in deciding how to allocate resources and in assessing performance.
|643| Chap. 26 – Ind AS 108 – Operating Segments The accounting policies adopted for segment reporting are in conformity with the accounting policies of the Group. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Inter segment revenue is accounted on the basis of transactions which are primarily determined based on market / fair value factors. Revenue, expenses, assets and liabilities which relate to the Group as a whole and are not allocable to segments on a reasonable basis have been included under ‘unallocated revenue / expenses / assets / liabilities’. Notes to accounts 39. Segment information 39.1 Continuing operations (a) Information about operating segments Based on the recommendations of the Audit Committee, post divestment of the Fertiliser business, the Board of Directors has approved the revised segment reporting, from April 1, 2018, as under: - Basic chemistry products : Soda Ash and other bulk chemicals - Consumer products : Branded consumer products such as salt, pulses, spices, etc - Specialty products : Nutrition solutions, agri Solutions and advance materials Inter segment pricing is determined on an arm’s length basis using transfer pricing principles. The corresponding information for the previous periods presented in these financial statement has been restated. ` in crore Particulars Year ended March 31, 2019 Year ended March 31, 2018 1. Segment revenue (Revenue from operations) (i) Basic chemistry products 8,309.05 7,672.92 (ii) Consumer products 1,847.28 1,512.24 (iii) Specialty products 2,026.29 1,843.38 12,182.62 11,028.54 Inter segment revenue (903.42) (702.17) 11,279.20 10,326.37 Unallocated 17.13 18.99 11,296.33 10,345.36 2. Segment result (Reconciliation with profit from continuing operations) ` in crore Particulars Year ended March 31, 2019 Year ended March 31, 2018 (i) Basic chemistry products 1,303.61 1,461.10 (ii) Consumer products 313.89 234.67 (iii) Specialty products 172.13 203.92 Total Segment results 1,789.63 1,899.69 Net unallocated income/(expenditure) 216.01 (3.21) Finance costs (363.10) (325.58) Profit before share of profit/loss from investment in joint ventures and tax 1,642.54 1,570.90 Share of profit of joint ventures (net of tax) 99.21 49.23 Tax expense (346.92) (60.13) Profit for the year from continuing operations 1,394.83 1,560.00
|644| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts 3. Segment assets and segment liabilities ` in crore Particulars As at March 31, 2019 As at March 31, 2018 As at March 31, 2019 As at March 31, 2018 (i) Basic chemistry products 15,142.21 14,213.24 2,636.93 2,880.41 (ii) Consumer products 220.44 140.54 181.69 137.27 (iii) Specialty products* 2,486.94 1,983.86 852.52 756.12 17,849.59 16,337.64 3,671.14 3,773.80 Unallocated 9,055.33 8,455.31 7,977.84 7,736.02 26,904.92 24,792.95 11,648.98 11,509.82 * Including assets held for sale 4. Other information Particulars Addition to non-current assets * Depreciation and amortisation Other non-cash expenses Year ended March 31, 2019 Year ended March 31, 2018 Year ended March 31, 2019 Year ended March 31, 2018 Year ended March 31, 2019 Year ended March 31, 2018 (i) Basic chemistry products 728.51 603.20 504.35 451.34 126.75 133.98 (ii) Consumer products 1.17 4.87 1.37 0.87 6.12 3.64 (iii) Specialty products 409.21 82.21 50.20 50.07 13.22 8.81 1,138.89 690.28 555.92 502.28 146.09 146.43 Unallocated 10.33 27.10 15.47 15.73 (2.54) (1.48) 1,149.22 717.38 571.39 518.01 143.55 144.95 *Comprises additions to Property, plant and equipment, Capital work-in-progress, Goodwill, Other intangible assets and Intangible assets under development. (b) Information about geographical areas The geographical segments revenue are disclosed on the basis of sales as follows: - Asia (other than India): Comprising sales to customers located in Asia (other than India). - Europe: Comprising sales to customers located in Europe. - Africa: Comprising sales to customers located in Africa. - America: Comprising sales to customers located in America. 1. Geographical Segment revenue* Year ended March 31, 2019 ` in crore Particulars Basic chemistry products Consumer products Specialty products Unallocated Total (i) India 2,062.85 1,845.76 1,374.54 17.13 5,300.28 (ii) Asia (other than India) 548.11 1.52 374.53 - 924.16 (iii) Europe 1,401.45 - 0.35 - 1,401.80 (iv) Africa 280.73 - 30.44 - 311.17 (v) America 3,101.59 - 235.56 - 3,337.15 (vi) Others 10.91 - 10.86 - 21.77 7,405.64 1,847.28 2,026.28 17.13 11,296.33
|645| Chap. 26 – Ind AS 108 – Operating Segments Year ended March 31, 2018 ` in crore Particulars Basic chemistry products Consumer products Specialty products Unallocated Total (i) India 2,086.39 1,511.23 1,363.87 18.99 4,980.48 (ii) Asia (other than India) 331.32 1.01 336.33 - 668.66 (iii) Europe 1,387.21 - 4.82 - 1,392.03 (iv) Africa 307.24 - 30.14 - 337.38 (v) America 2,850.62 - 99.01 - 2,949.63 (vi) Others 7.99 - 9.19 - 17.18 6,970.77 1,512.24 1,843.36 18.99 10,345.36 * Including operating revenues and net of inter segment revenue 2. Non-current assets* ` in crore Particulars As at March 31, 2019 As at March 31, 2018 (i) India 3,631.53 2,896.39 (ii) Asia (other than India) 0.03 0.06 (iii) Europe 1,321.28 1,287.60 (iv) Africa 115.87 120.13 (v) America 10,275.14 9,675.90 15,343.85 13,980.08 *non-current assets other than investments in joint ventures, financial assets, deferred tax assets (net) and net defined benefit assets (c) Revenue from major products The following is an analysis of Group's segment revenue from continuing operations from its major products ` in crore Particulars Year ended March 31, 2019* Year ended March 31, 2018* (i) Basic chemistry products - Soda Ash 5,990.22 5,532.98 - Bicarb 429.32 467.02 - Others 986.09 970.75 (ii) Consumer products - Salt 1,608.43 1,400.34 - Others 238.85 111.90 (iii) Specialty products - Crop Protection (includes Fungicides, Herbicides and Insecticides) 1,481.48 1,333.84 - Seeds 311.19 291.30 - Others 233.62 218.24 (iv) Unallocated 17.13 18.99 11,296.33 10,345.36 * Including operating revenues and net of inter segment revenue
|646| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts (d) Revenue from major customers No single customer contributed 10% or more to the Group's revenue for the year ended March 31, 2019 and March 31, 2018. (e) Other note Segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis. 39.2 Discontinued operations (note 34) (a) Information about operating segment ` in crore Particulars Year ended March 31, 2019 Year ended March 31, 2018 Revenue from operations (external) 624.55 4,086.91 Result : Segment result (9.13) 1,715.12 Finance costs (2.18) (63.41) Profit before tax (11.31) 1,651.71 Tax expenses 3.33 (509.22) Profit from discontinued operations after tax (7.98) 1,142.49 Other information ` in crore Particulars As at March 31, 2019 As at March 31, 2018 Segment assets - 1,085.69 Segment liabilities - 549.95 ` in crore Particulars Year ended March 31, 2019 Year ended March 31, 2018 Addition to non-current assets* - 10.58 Depreciation and amortisation - 12.58 Other non-cash (income)/expenses (8.54) 103.20 *Comprises additions to Property, plant and equipment, Capital work-in-progress and Intangible assets (b) Information about geographical area Discontinued operations sells its products mainly within India where the conditions prevailing are uniform. (c) Revenue from major products Discontinued operations segment deals in one product group i.e fertiliser and other agri inputs. (d) Revenue from major customers No single customer contributed 10% or more to the discontinued operations of the Group's revenue for the year ended March 31, 2019 and March 31, 2018.
|647| Chap. 26 – Ind AS 108 – Operating Segments 39.3 Reconciliation of information on reportable segment to Consolidated Balance Sheet and Consolidated Statement of Profit and Loss (a) Reconciliation of profit for the year as per Consolidated Statement of Profit and Loss ` in crore Particulars Year ended March 31, 2019 Year ended March 31, 2018 Profit for the year from continuing operations (note 39.1 (a) (2)) 1,394.83 1,560.00 Profit for the year from discontinued operations (note 39.2 (a)) (7.98) 1,142.49 Profit for the year as per Consolidated Statement of Profit and Loss 1,386.85 2,702.49 (b) Reconciliation of total assets as per Consolidated Balance Sheet ` in crore Particulars As at March 31, 2019 As at March 31, 2018 Total assets as per continuing operations (note 39.1 (a) (3)) 26,904.92 24,792.95 Total assets as per discontinued operations (note 39.2 (a)) - 1,085.69 Total assets as per Consolidated Balance Sheet 26,904.92 25,878.64 (c) Reconciliation of total liabilities as per Consolidated Balance Sheet ` in crore Particulars As at March 31, 2019 As at March 31, 2018 Total liabilities as per continuing operations (note 39.1 (a) (3)) 11,648.98 11,509.82 Total liabilities as per discontinued operations (note 39.2 (a)) - 549.95 Total liabilities as per Consolidated Balance Sheet 11,648.98 12,059.77 9. TATA CONSULTANCY SERVICES LIMITED 32) Segment information Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance. The Group’s chief operating decision maker is the Chief Executive Officer and Managing Director. The Group has identified business segments (‘industry vertical’) as reportable segments. The business segments comprise: 1) Banking, Financial Services and Insurance, 2) Manufacturing, 3) Retail and Consumer Business, 4) Communication, Media and Technology and 5) Others such as Energy, Resources and Utilities, Life Science and Healthcare, s-Governance and Products. Revenue and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reporting segment have been allocated on the basis of associated revenue of the segment or manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. Property, plant and equipment that are used interchangeably among segments are not allocated to reportable segments.
|648| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Summarised segment information for the years ended March 31, 2019 and 2018 is as follows: Year ended March 31, 2019 (` crore) Banking, Financial Services and Insurance Manufacturing Retail and Consumer Business Communication, Media and Technology Others Total Revenue 57,938 15,682 25,164 23,925 23,754 146,463 Segment result 16,089 4,311 6,871 6,644 5,554 39,469 Total Unallocable expenses 2,217 Operating income 37,252 Other income (net) 4,311 Profit before taxes 41,563 Tax expense 10,001 Profit for the year 31,562 Depreciation and amortisation expense 35 - - - 2 37 Depreciation and amortisation expense (unallocable) 2,019 Significant non-cash items (allocable) 6 3 27 27 124 187 As at March 31, 2019 (` crore) Banking, Financial Services and Insurance Manufacturing Retail and Consumer Business Communication, Media and Technology Others Total Segment assets 13,650 4,305 6,982 6,042 7,945 38,924 Unallocable assets 76,019 Total assets 114,943 Segment liabilities 3,167 262 535 452 1,081 5,497 Unallocable liabilities 19,547 Total liabilities 25,044 Year ended March 31, 2018 (` crore) Banking, Financial Services and Insurance Manufacturing Retail and Consumer Business Communication, Media and Technology Others Total Revenue 48,418 13,361 21,055 21,131 19,139 123,104 Segment result 13,045 3,698 5,580 5,797 4,339 32,459 Total Unallocable expenses 2,009 Operating income 30,450 Other income (net) 3,642 Profit before taxes 34,092 Tax expense 8,212 Profit for the year 25,880 Depreciation and amortisation expense 55 - - - 2 57 Depreciation and amortisation expense (unallocable) 1,957 Significant non-cash items (allocable) 51 4 33 38 80 206
|649| Chap. 26 – Ind AS 108 – Operating Segments As at March 31, 2018 (` crore) Banking, Financial Services and Insurance Manufacturing Retail and Consumer Business Communication, Media and Technology Others Total Segment assets 11,700 3,559 6,024 6,033 7,003 34,319 Unallocable assets 71,977 Total assets 106,296 Segment liabilities 2,661 178 478 428 780 4,525 Unallocable liabilities 16,241 Total liabilities 20,766 Geographical revenue is allocated based on the location of the customers. Information regarding geographical revenue is as follows: (` crore) Geography Year ended March 31, 2019 Year ended March 31, 2018 Americas (1) 77,562 66,145 Europe (2) 43,456 34,155 India 8,393 7,921 Others 17,052 14,883 Total 146,463 123,104 Geographical non-current assets (property, plant and equipment, goodwill, intangible assets, income tax assets and other non-current assets) are allocated based on the location of the assets. Information regarding geographical non-current assets is as follows: (` crore) Geography Year ended March 31, 2019 Year ended March 31, 2018 Americas (3) 1,531 1,354 Europe (4) 2,250 1,694 India 14,313 14,699 Others 539 588 Total 18,633 18,335 i. (1) and (3) are substantially related to operations in the United States of America. ii. (2) includes revenue in the United Kingdom of ` 22,862 crore and ` 17,625 crore for the years ended March 31, 2019 and 2018, respectively. iii. (4) includes non-current assets from operations in the United Kingdom of ` 891 crore and ` 568 crore as at March 31, 2019 and 2018, respectively. Information about major customers No single customer represents 10% or more of the Group’s total revenue for the years ended March 31, 2019 and 2018, respectively. 10. TVS MOTOR COMPANY LIMITED IND AS – 108 - Operating Segments The Group has identified the operating segments on the basis of individual companies operations as reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker.
|650| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts The Group has identified the following business segments as reportable segments, (on the basis of products and production process) viz., (1) Automotive vehicles and parts, (2) Automotive components, (3) Financial services and (4) Others. 11. ZOMATO MEDIA PRIVATE LIMITED Segment reporting Identification of segments The Group’s operating businesses are organized and managed separately according to the geographical locations of the customers, with each segment representing a strategic business unit that serves different markets. The ‘Others’ segment includes those segments, which are not separately reportable as per Ind AS 108. Allocation of common costs Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs. Unallocated items Unallocated items include general corporate income and expense items which are not allocated to any business segment. Disclosure 42. Segment Information Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance. The Group’s chief operating decision maker is the Chief Executive Officer. The Group has identified geographical segments as reportable segments. The geographical segments comprise: 1) India 2) United Arab Emirates (UAE) 3) ROW (such as Australia, New Zealand, Philippines, Indonesia, Malaysia, USA, Lebanon, Turkey, Czech, Slovakia, Poland) Revenue and expenses directly attributable to segments are reported under each reportable segment. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. Summarised segment information for the years ended March 31, 2019 and March 31, 2018 is as follows: Year ended 31 March 2019 Particulars India UAE ROW Total segments Adjustments and Eliminations Consolidated Revenue Revenue External customers 20,358.02 1,943.62 969,09 23,270 .73 -10,144.97 13,125.76 Inter-segment 120.39 - - 120.39 -120.29 0.1 Total revenue 20,478.41 1,943.62 969.09 23,.391.12 -10,265.26 13,125.86 Income/(Expenses) Depreciation and amortisation 103.67 4.13 6.74 114.54 141,39 255,93
|651| Chap. 26 – Ind AS 108 – Operating Segments Year ended 31 March 2019 Particulars India UAE ROW Total segments Adjustments and Eliminations Consolidated Revenue Segment loss -22,001.70 12,498.28 -639.99 -10,143.41 132.26 -10,011.15 Total assets 31,429.91 4,640.41 2,240.29 38,310.61 -5,169.41 33,141.20 Total liabilities 14,381.57 -8,096.86 526.3 6,811.01 554.06 7,365.07 Other disclosures Investments in an associate and a Joint venture 1.63 - - 1.63 - 1.63 Capital expenditure 469,05 3.44 10.54 483.03 1,033.11 1,516.14 Year ended 31 March 2018 Particulars India UAE ROW Total segments Adjustments and Eliminations Consolidated Revenue Revenue External customers 2,932.56 1,117.45 825.15 4,875.16 -222.18 4,652.98 Inter-segment 45.8 - 45,8 -35.14 10.65 Total revenue 2,978.35 1,117.45 825.15 4,920.96 -257.32 4,663.63 Income/(Expenses) Depreciation and amortisation 135.85 11.52 12.86 160.24 - 160.24 Segment loss -1,269.84 336.79 -305.53 -1,238.58 175.46 -1,063,12 Total assets 14,863.56 652.7 2,051.80 17,568.05 -4,070.94 13,497.12 Total liabilities 623.5 385.87 444.21 1,453.58 -150.94 1,302.64 Other disclosures Investments in an associate and a Joint venture 1.63 - - 1.63 - - 1.63 Capital expenditure 35 6.17 2.89 44.07 1,564.91 1,608.98 Inter-segment revenues are eliminated upon consolidation and reflected in the ‘adjustments and eliminations’ column. All other adjustments and eliminations are part of detailed reconciliations presented further below. Adjustments and eliminations Finance income and costs, and fair value gains and losses on financial assets are not allocated to individual segments as the underlying instruments are managed on a group basis. Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are also managed on a group basis. Capital expenditure consists of additions of property, plant and equipment, intangible assets and investment properties including assets from the acquisition of subsidiaries. Reconciliations to amounts reflected in the financial statements Reconciliation of loss 31-March-2019 31-March-2018 Segment loss -10,143.41 -1,238.58 Inter-segment sales (elimination) 132.26 175.46 Loss before tax -10,011.15 -1,063.12
|652| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Reconciliation of assets 31-March-2019 31-March-2018 Segment operating assets 35,106.13 11,142.49 Loan notes (Note 10) 43.21 Adjustments and Eliminations -5,169.40 -79.96 Total assets 29,936.73 11,105.74 Recondliation of liabilities 31-March-2019 31-March-2018 Segment operating liabilities 6,811.01 1,453.58 Adjustments and Eliminations 554.06 -150.94 Total liabilities 7,365.07 1,302.64 Revenue from external customers 31-March-2019 31-March-2018 India 20,478.41 2,978. 34 Outside India 2,91 2.71 1,942.61 Adjustments and Eliminations -10,265.26 -257.32 Total revenue per consolidated statement of profit or loss 13,125.86 4,663.63 Non-current operating assets 31-March-2019 31-March-2018 India 6,594.61 4,737.61 Outside India 1,839.32 1,644.74 Adjustments and Eliminations -5,229 .46 -3,990.98 Total 3,204.47 2,391.38 Non-current assets for this purpose consist of property, plant and equipment, investment properties and intangible. Information about major customers: No single customer represents 10% or more of the Group's total revenue for the year ended 31 March 2019 and 31 March 2018. ll
|653| Chap. 27 – Ind AS 109 – Financial Instruments Chapter 27 Ind AS 109 – Financial Instruments 1. DR. REDDY’S LABORATORIES LIMITED A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets Initial recognition and measurement All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (e.g., regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset. Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant finuancing components, in which case they are recognised at fair value. The Company’s trade receivables do not contain any significant financing component and hence are measured at the transaction price measured under Ind AS 115. Subsequent measurement For purposes of subsequent measurement, financial assets are classified in four categories: • Debt instruments at amortised cost; • Debt instruments at FVTOCI; • Debt instruments, derivatives and equity instruments at FVTPL; and • Equity instruments measured at FVTOCI. Debt instruments at amortised cost A “debt instrument” is measured at the amortised cost if both the following conditions are met: a) the asset is held within a business model whose objective is to hold assets for collecting contractual cash flows; and b) contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding. After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. The effective interest rate amortisation is included in other income in the consolidated statement of profit and loss. The losses arising from impairment are recognised in the consolidated statement of profit and loss. This category generally applies to trade and other receivables. Debt instrument at FVTOCI A “debt instrument” is classified as at the FVTOCI if both of the following criteria are met: a) the objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets; and
|654| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts b) the asset’s contractual cash flows represent SPPI. Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognised in the other comprehensive income (OCI). However, the Company recognises interest income, impairment losses and reversals and foreign exchange gain or loss in the consolidated statement of profit and loss. On derecognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified to the consolidated statement of profit and loss. Interest earned while holding a FVTOCI debt instrument is reported as interest income using the effective interest rate method. Debt instrument at FVTPL FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorisation as at amortised cost or as FVTOCI, is classifi ed as at FVTPL. In addition, the Company may elect to designate a debt instrument, which otherwise meets amortised cost or FVTOCI criteria, as at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as an “accounting mismatch”). Debt instruments included within the FVTPL category are measured at fair value with all changes recognised in the consolidated statement of profit and loss. Equity investments All equity investments within the scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading and contingent consideration recognised by an acquirer in a business combination to which Ind AS103 applies, are classified as at FVTPL. For all other equity instruments, the Company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis. The classification is made upon initial recognition and is irrevocable. If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognised in the OCI. There is no recycling of the amounts from OCI to the consolidated statement of profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity. Equity investments designated as FVTOCI are not subject to impairment assessment. Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the consolidated statement of profit and loss. Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed from the Company’s consolidated balance sheet) when: the rights to receive cash flows from the asset have expired; or Both (1) the Company has transferred its rights to receive cash fl ows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a “pass-through” arrangement” and (2) either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. When the Company has transferred its rights to receive cash flows from an asset or has entered into a passthrough arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
|655| Chap. 27 – Ind AS 109 – Financial Instruments Impairment of trade receivables and other financial assets In accordance with Ind AS 109, the Company applies the expected credit loss (ECL) model for measurement and recognition of impairment loss on trade receivables or any contractual right to receive cash or another fi nancial asset. For this purpose, the Company follows a “simplified approach” for recognition of impairment loss allowance on the trade receivable balances. The application of this simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed. Liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an eff ective hedge, as appropriate. All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts and derivative financial instruments. Subsequent measurement The measurement of financial liabilities depends on their classification, as described below: Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on liabilities held for trading are recognised in the consolidated statement of profit and loss. Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognised in OCI. These gains or losses are not subsequently transferred to the consolidated statement of profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the consolidated statement of profit and loss. The Company has not designated any financial liability as fair value through profit and loss. Loans and borrowings After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in the consolidated statement of profit and loss when the liabilities are derecognised as well as through the effective interest rate amortisation process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. The effective interest rate amortisation is included as finance costs in the consolidated statement of profit and loss.
|656| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Derecognition A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the consolidated statement of profit and loss. Derivative financial instruments The Company is exposed to exchange rate risk which arises from its foreign exchange revenues and expenses, primarily in US dollars, UK pounds sterling, Russian roubles, Brazilian reals, South African fronds (“ZAR”), Romanian new leus (“RON”) and Euros, and foreign currency debt in US dollars, Russian roubles, Ukrainian hryvnias and Euros. The Company uses derivative financial instruments such as foreign exchange forward contracts, option contracts and swap contracts to mitigate its risk of changes in foreign currency exchange rates. The Company also uses non-derivative financial instruments as part of its foreign currency exposure risk mitigation strategy. Hedges of highly probable forecasted transactions The Company classifies its derivative financial instruments that hedge foreign currency risk associated with highly probable forecasted transactions as cash flow hedges and measures them at fair value. The effective portion of such cash flow hedges is recorded in the Company’s hedging reserve as a component of equity and re-classified to the consolidated statement of profit and loss as part of the hedged item in the period corresponding to the occurrence of the forecasted transactions. The ineffective portion of such cash flow hedges is recorded in the consolidated statement of profit and loss as finance costs immediately. The Company also designates certain non-derivative financial liabilities, such as foreign currency borrowings from banks, as hedging instruments for hedge of foreign currency risk associated with highly probable forecasted transactions. Accordingly, the Company applies cash flow hedge accounting to such relationships. Remeasurement gain or loss on such non-derivative financial liabilities is recorded in the Company’s hedging reserve as a component of equity and reclassified to the consolidated statement of profit and loss as part of the hedged item in the period corresponding to the occurrence of the forecasted transactions. If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, then hedge accounting is discontinued prospectively. The cumulative gain or loss previously recognised in other comprehensive income, remains there until the forecasted transaction occurs. If the forecasted transaction is no longer expected to occur, then the balance in other comprehensive income is recognised immediately in the consolidated statement of profit and loss. Hedges of recognised assets and liabilities Changes in the fair value of derivative contracts that economically hedge monetary assets and liabilities in foreign currencies, and for which no hedge accounting is applied, are recognised in the consolidated statement of profi t and loss. The changes in fair value of such derivative contracts, as well as the foreign exchange gains and losses relating to the monetary items, are recognised in the consolidated statement of profit and loss. If the hedged item is derecognised, the unamortised fair value is recognised immediately in the consolidated statement of profit and loss. Hedges of changes in the interest rates Consistent with its risk management policy, the Company uses interest rate swaps to mitigate the risk of changes in interest rates. The Company does not use them for trading or speculative purposes. Cash and cash equivalents Cash and cash equivalents consist of cash on hand, demand deposits and short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant
|657| Chap. 27 – Ind AS 109 – Financial Instruments risk of changes in value. For this purpose, “short-term” means investments having original maturities of three months or less from the date of investment. Bank overdrafts that are repayable on demand form an integral part of the Company’s cash management and are included as a component of cash and cash equivalents for the purpose of the consolidated statement of cash flows. 2. GRASIM INDUSTRIES LIMITED Financial Instruments A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity Financial Assets Initial Recognition and Measurement All financial assets are recognised initially at fair value. However, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset are added to the fair value. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell the asset. Subsequent measurement For the purposes of subsequent measurement, financial assets are classified in four categories: • Debt instruments at amortised cost • Debt instruments at Fair Value through Other Comprehensive Income (FVTOCI) • Debt instruments, derivatives and equity instruments, mutual funds at Fair Value through Profit or Loss (FVTPL) • Equity instruments measured at FVTOCI Debt Instruments at Amortised Cost: A ‘debt instrument’ is measured at amortised cost, if both the following conditions are met: a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows; and b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding. After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the profit or loss. The losses arising from impairment are recognised in the profit or loss. This category generally applies to trade and other receivables. Debt instrument at FVTOCI A ‘debt instrument’ is classified at FVTOCI, if both of the following criteria are met: a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets; and b) The asset’s contractual cash flows represent SPPI on the principal amount outstanding. Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognised in the OCI. However, the Group recognises interest income, impairment losses and reversals, and foreign exchange gain or loss in the Statement of Profit and Loss. On de-recognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to the Statement of Profit and Loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the EIR method.
|658| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Debt Instrument at FVTPL FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorisation as at amortized cost or as FVTOCI, is classified as at FVTPL. In addition, the group may elect to designate a debt instrument, which otherwise meets amortised cost or FVTOCI criteria, as at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ‘accounting mismatch’). Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the Statement of Profit and Loss, except for changes with respect to Policyholders’ investments under the life insurance business (except for assets held to cover linked liabilities) relating to Revenue Account of Life Insurance Policyholders, wherein the fair value movements are included under “Life insurance contract liabilities and other financial liabilities of the life insurance fund” in the Balance Sheet. Equity Investments Investment in Associates and Joint ventures are out of scope of Ind AS 109 and it is accounted as per Ind AS 28. All other equity investments are measured at fair value. Equity instruments, which are held for trading, are classified as at FVTPL. For equity instruments, other than held for trading, the Group has irrevocable option to present in OCI subsequent changes in the fair value. The group makes such election on an instrumentby instrument basis. The classification is made on initial recognition and is irrevocable. Where the Group classifies equity instruments as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of the amounts of profit or loss from OCI to Statement of Profit and Loss, even on sale of investment. Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the Statement of Profit and Loss, except for changes with respect to Policyholders’ investments under the life insurance business (except for assets held to cover linked liabilities) relating to Revenue Account of Life Insurance Policyholders, wherein the fair value movements are included under “Life insurance contract liabilities and other financial liabilities of the life insurance fund” in the Balance Sheet. Impairment of Financial Assets The Group recognises loss allowances for ECLs on the following financial instruments that are not measured at FVTPL: • Loans and advances to customers; • Debt investment securities; • Trade and other receivable; • Lease receivables; • Irrevocable loan commitments issued; and • Financial guarantee contracts issued. With the exception of POCI financial assets (which are considered separately below), ECLs are required to be measured through a loss allowance at an amount equal to: • 12-month ECL, i.e. that result from those default events on the financial instrument that are possible within 12 months after the reporting date, (referred to as Stage 1); or • full lifetime ECL, i.e. that result from all possible default events over the life of the financial instrument, (referred to as Stage 2 and Stage 3). A loss allowance for full lifetime ECL is required for a financial instrument if the credit risk on that financial instrument has increased significantly since initial
|659| Chap. 27 – Ind AS 109 – Financial Instruments recognition (and consequently for credit impaired financial assets). For all other financial instruments, ECLs are measured at an amount equal to the 12-month ECL The Group’s policy is always to measure loss allowances for lease receivables as lifetime ECL. ECLs are a probability-weighted estimate of the present value of credit losses. These are measured as the present value of the difference between the cash flows due to the Group under the contract and the cash flows that the Group expects to receive arising from the weighting of multiple future economic scenarios, discounted at the asset’s EIR. • for undrawn loan commitments, the ECL is the difference between the present value of the difference between the contractual cash flows that are due to the Group if the holder of the commitment draws down the loan and the cash flows that the Group expects to receive if the loan is drawn down; and • for financial guarantee contracts, the ECL is the difference between the expected payments to reimburse the holder of the guaranteed debt instrument less any amounts that the Group expects to receive from the holder, the debtor or any other party. The Group measures ECL on an individual basis, or on a collective basis for portfolios of loans that share similar economic risk characteristics. The measurement of the loss allowance is based on the present value of the asset’s expected cash flows using the asset’s original EIR, regardless of whether it is measured on an individual basis or a collective basis. Credit-impaired financial assets A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Credit-impaired financial assets are referred to as Stage 3 assets. Evidence of credit-impairment includes observable data about the following events: • significant financial difficulty of the borrower or issuer; • a breach of contract such as a default or past due event; • the lender of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider; • the disappearance of an active market for a security because of financial difficulties; or • the purchase of a financial asset at a deep discount that reflects the incurred credit losses. It may not be possible to identify a single discrete event—instead, the combined effect of several events may have caused financial assets to become credit-impaired. The Group assesses whether debt instruments that are financial assets measured at amortised cost or FVTOCI are credit-impaired at each reporting date. To assess if corporate debt instruments are credit impaired, the Group considers factors such as bond yields, credit ratings and the ability of the borrower to raise funding. A loan is considered credit-impaired when a concession is granted to the borrower due to a deterioration in the borrower’s financial condition, unless there is evidence that as a result of granting the concession the risk of not receiving the contractual cash flows has reduced significantly and there are no other indicators of impairment. For financial assets where concessions are contemplated but not granted the asset is deemed credit impaired when there is observable evidence of credit-impairment including meeting the definition of default. The definition of default (see below) includes unlikeliness to pay indicators and a back-stop if amounts are overdue for 90 days or more. Purchased or originated credit-impaired (POCI) financial assets POCI financial assets are treated differently because the asset is credit-impaired at initial recognition. For these assets, the Group recognises all changes in lifetime ECL since initial recognition as a loss allowance with any changes recognised in Statement of Profit and Loss. A favorable change for such assets creates an impairment gain. Definition of default
|660| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Critical to the determination of ECL is the definition of default. The definition of default is used in measuring the amount of ECL and in the determination of whether the loss allowance is based on 12-month or lifetime ECL, as default is a component of the probability of default (PD) which affects both the measurement of ECLs and the identification of a significant increase in credit risk. The Group considers the following as constituting an event of default: • the borrower is past due more than 90 days on any material credit obligation to the Group; or • the borrower is unlikely to pay its credit obligations to the Group in full. The definition of default is appropriately tailored to reflect different characteristics of different types of assets. When assessing if the borrower is unlikely to pay its credit obligation, the Group takes into account both qualitative and quantitative indicators. The information assessed depends on the type of the asset, for example in corporate lending a qualitative indicator used is the admittance of bankruptcy petition by National Company Low Tribunal (NCLT), which is not relevant for retail lending. Quantitative indicators, such as overdue status and non-payment on another obligation of the same counterparty are key inputs in this analysis. The Group uses a variety of sources of information to assess default which are either developed internally or obtained from external sources. The definition of default is applied consistently to all financial instruments unless information becomes available that demonstrates that another default definition is more appropriate for a particular financial instrument. Significant increase in credit risk The Group monitors all financial assets, issued irrevocable loan commitments and financial guarantee contracts that are subject to the impairment requirements to assess whether there has been a significant increase in credit risk since initial recognition. If there has been a significant increase in credit risk the Group will measure the loss allowance based on lifetime rather than 12-month ECL. The Group’s accounting policy is not to use the practical expedient that financial assets with ‘low’ credit risk at the reporting date are deemed not to have had a significant increase in credit risk. As a result, the Group monitors all financial assets, issued irrevocable loan commitments and financial guarantee contracts that are subject to impairment for significant increase in credit risk. In assessing whether the credit risk on a financial instrument has increased significantly since initial recognition, the Group compares the risk of a default occurring on the financial instrument at the reporting date based on the remaining maturity of the instrument with the risk of a default occurring that was anticipated for the remaining maturity at the current reporting date when the financial instrument was first recognised. In making this assessment, the Group considers both quantitative and qualitative information that is reasonable and supportable, including historical experience and forwardlooking information that is available without undue cost or effort, based on the Group’s historical experience and expert credit assessment. Given that a significant increase in credit risk since initial recognition is a relative measure, a given change, in absolute terms, in the probability of default (PD) will be more significant for a financial instrument with a lower initial PD than compared to a financial instrument with a higher PD. Modification and derecognition of financial assets A modification of a financial asset occurs when the contractual terms governing the cash flows of a financial asset are renegotiated or otherwise modified between initial recognition and maturity of the financial asset. A modification affects the amount and/or timing of the contractual cash flows either immediately or at a future date. In addition, the introduction or adjustment of existing covenants of an existing loan may constitute a modification even if these new or adjusted covenants do not yet affect the cash flows immediately but may affect the cash flows depending on whether the covenant is or is not met (e.g. a change to the increase in the interest rate that arises when covenants are breached). The Group renegotiates loans to customers in financial difficulty to maximise collection and minimise the risk of default. A loan forbearance is granted in cases where although the borrower made all reasonable efforts to pay under the original contractual terms, there is a high risk of default or default has already happened and the borrower is expected to be able to meet the revised terms. The revised terms in most of the cases include an extension of the maturity of the loan, changes to the timing of the cash flows of the loan (principal and interest repayment), reduction
|661| Chap. 27 – Ind AS 109 – Financial Instruments in the amount of cash flows due (principal and interest forgiveness) and amendments to covenants. When a financial asset is modified the Group assesses whether this modification results in derecognition. In accordance with the Group’s policy a modification results in derecognition when it gives rise to substantially different terms. To determine if the modified terms are substantially different from the original contractual terms the Group considers the following: • Qualitative factors, such as contractual cash flows after modification are no longer SPPI • change in currency or change of counterparty • the extent of change in interest rates, maturity, covenants • If these do not clearly indicate a substantial modification, then; In the case where the financial asset is derecognised the loss allowance for ECL is remeasured at the date of derecognition to determine the net carrying amount of the asset at that date. The difference between this revised carrying amount and the fair value of the new financial asset with the new terms will lead to a gain or loss on derecognition. The new financial asset will have a loss allowance measured based on 12-month ECL except in the rare occasions where the new loan is considered to be originated-credit impaired. This applies only in the case where the fair value of the new loan is recognised at a significant discount to its revised paramount because there remains a high risk of default which has not been reduced by the modification. The Group monitors credit risk of modified financial assets by evaluating qualitative and quantitative information, such as if the borrower is in past due status under the new terms. When the contractual terms of a financial asset are modified and the modification does not result in derecognition, the Group determines if the financial asset’s credit risk has increased significantly since initial recognition by comparing: • the remaining lifetime PD estimated based on data at initial recognition and the original contractual terms; with • the remaining lifetime PD at the reporting date based on the modified terms. For financial assets modified, where modification did not result in derecognition, the estimate of PD reflects the Group’s ability to collect the modified cash flows taking into account the Group’s previous experience of similar forbearance action, as well as various behavioural indicators, including the borrower’s payment performance against the modified contractual terms. If the credit risk remains significantly higher than what was expected at initial recognition the loss allowance will continue to be measured at an amount equal to lifetime ECL. The loss allowance on forborne loans will generally only be measured based on 12-month ECL when there is evidence of the borrower’s improved repayment behaviour following modification leading to a reversal of the previous significant increase in credit risk. Where a modification does not lead to derecognition the Group calculates the modification gain/loss comparing the gross carrying amount before and after the modification (excluding the ECL allowance). Then the Group measures ECL for the modified asset, where the expected cash flows arising from the modified financial asset are included in calculating the expected cash shortfalls from the original asset. The Group derecognises a financial asset only when the contractual rights to the asset’s cash flows expire (including expiry arising from a modification with substantially different terms), or when the financial asset and substantially all the risks and rewards of ownership of the asset are transferred to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received. On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain/loss that had been recognised in OCI and accumulated in equity is recognised in the Statement of Profit and Loss, with the exception of equity investment designated as measured at FVTOCI, where the cumulative gain/loss previously recognised in OCI is not subsequently reclassified to the Statement of Profit and Loss. On derecognition of a financial
|662| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts asset other than in its entirety (e.g. when the Group retains an option to repurchase part of a transferred asset), the Group allocates the previous carrying amount of the financial asset between the part it continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any cumulative gain/loss allocated to it that had been recognised in OCI is recognised in the Statement of Profit and Loss. A cumulative gain/loss that had been recognised in OCI is allocated between the part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair values of those parts. This does not apply for equity investments designated as measured at FVTOCI, as the cumulative gain/loss previously recognised in OCI is not subsequently reclassified to the Statement of Profit and Loss. Write off Loans and debt securities are written off when the Group has no reasonable expectations of recovering the financial asset (either in its entirety or a portion of it). This is the case when the Group determines that the borrower does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off. A write-off constitutes a derecognition event. The Group may apply enforcement activities to financial assets written off. Recoveries resulting from the Group’s enforcement activities will result in impairment gains. Presentation of allowance for ECL in the Balance Sheet Loss allowances for ECL are presented in the Balance Sheet as follows: • for financial assets measured at amortised cost: as a deduction from the gross carrying amount of the assets; • for debt instruments measured at FVTOCI: no loss allowance is recognised in the Balance Sheet as the carrying amount is at fair value. Where a financial instrument includes both a drawn and an undrawn component, and the Group cannot identify the ECL on the loan commitment component separately from those on the drawn component: the Group presents a combined loss allowance for both components. The combined amount is presented as a deduction from the gross carrying amount of the drawn component. Financial Liabilities and Equity Instruments Classification as Debt or Equity: Debt and equity instruments, issued by the Group, are classified as either financial liabilities or as equity, in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. Equity Instruments An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs. Financial Liabilities Financial liabilities are classified, at initial recognition as fair value through profit or loss: • Loans and borrowings, • Payables, or • as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognised initially at fair value, and in the case of loans and borrowings and payables are recognised net of directly attributable transaction costs. The Group’s financial liabilities include trade and other payables, loans and borrowings, including bank overdrafts, financial guarantee contracts and derivative financial instruments.
|663| Chap. 27 – Ind AS 109 – Financial Instruments Subsequent Measurement The measurement of financial liabilities depends on their classification, as described below: Financial Liabilities at FVTPL Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at FVTPL. Financial liabilities are classified as held for trading, if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Group, that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading, unless they are designated as effective hedging instruments. Gains or losses on liabilities held for trading are recognised in the Statement of Profit and Loss. Financial liabilities, designated upon initial recognition at FVTPL, are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. Loans and Borrowings After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the Effective Interest Rate (EIR) method. Gains and losses are recognised in the Statement of Profit and Loss, when the liabilities are derecognised as well as through the EIR amortisation process Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss. Financial Guarantee Contracts Financial guarantee contracts issued by the Group, are those contracts that require a payment to be made to reimburse the holder for a loss it incurs, because the specified debtor fails to make a payment when due, in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per the impairment requirements of Ind AS 109, and the amount recognised less cumulative amortisation. De-recognition of Financial Liabilities The Group de-recognises financial liabilities when and only when, the Group’s obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability de-recognised and the consideration paid and payable is recognised in Statement of Profit and Loss. Embedded Derivatives An embedded derivative is a component of a hybrid (combined) instrument, that also includes a nonderivative host contract – with the effect that some of the cash flows of the combined instrument vary in a way similar to a stand-alone derivative. An embedded derivative causes some or all of the cash flows that would otherwise be required by the contract to be modified according to a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable, provided in the case of a non-financial variable, that the variable is not specific to a party to the contract. Re-assessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows, that would otherwise be required or a re-classification of a financial asset out of the fair value through profit or loss. If the hybrid contract contains a host that is a financial asset within the scope of Ind AS 109, the Company does not separate the embedded derivatives. Rather, it applies the classification requirements contained in Ind AS 109 to the entire hybrid contract. Derivatives embedded in all other host contracts are accounted for as separate derivatives and recorded at fair value, if their economic characteristics and risks are not closely related to those of the host contracts, and the host contracts are not held for trading or designated at fair value though profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognised in profit or loss, unless designated as effective hedging instruments.
|664| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Offsetting of Financial Instruments Financial assets and financial liabilities are offset and the net amount is reported in the Balance Sheet, if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously. 3. ITC LIMITED Financial Instruments, Financial Assets, Financial Liabilities and Equity Instruments Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the relevant instrument and are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities measured at fair value through profit or loss) are added to or deducted from the fair value on initial recognition of financial assets or financial liabilities. Purchase or sale of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date when the Group commits to purchase or sell the asset. Financial Assets Recognition: Financial assets include Investments, Trade receivables, Advances, Security deposits, Cash and cash equivalents. Such assets are initially recognised at transaction price when the Group becomes party to contractual obligations. The transaction price includes transaction costs unless the asset is being fair valued through the Statement of Profit and Loss. Classification: Management determines the classification of an asset at initial recognition depending on the purpose for which the assets were acquired. The subsequent measurement of financial assets depends on such classification. Financial assets are classified as those measured at: (a) amortised cost, where the financial assets are held solely for collection of cash flows arising from payments of principal and / or interest. (b) fair value through other comprehensive income (FVTOCI), where the financial assets are held not only for collection of cash flows arising from payments of principal and interest but also from the sale of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognised in other comprehensive income. (c) fair value through profit or loss (FVTPL), where the assets are managed in accordance with an approved investment strategy that triggers purchase and sale decisions based on the fair value of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognised in the Statement of Profit and Loss in the period in which they arise. Trade receivables, Advances, Security deposits, Cash and cash equivalents etc. are classified for measurement at amortised cost while investments may fall under any of the aforesaid classes. However, in respect of particular investments in equity instruments that would otherwise be measured at fair value through profit or loss, an irrevocable election at initial recognition may be made to present subsequent changes in fair value through other comprehensive income. Impairment: The Group assesses at each reporting date whether a financial asset (or a group of financial assets) such as investments, trade receivables, advances and security deposits held at amortised cost and financial assets that are measured at fair value through other comprehensive income are tested for impairment based on evidence or information that is available without undue cost or effort. Expected credit losses are assessed and loss allowances recognised if the credit quality of the financial asset has deteriorated significantly since initial recognition.
|665| Chap. 27 – Ind AS 109 – Financial Instruments Reclassification: When and only when the business model is changed, the Group shall reclassify all affected financial assets prospectively from the reclassification date as subsequently measured at amortised cost, fair value through other comprehensive income, fair value through profit or loss without restating the previously recognised gains, losses or interest and in terms of the reclassification principles laid down in the Ind AS relating to Financial Instruments. De-recognition: Financial assets are derecognised when the right to receive cash flows from the assets has expired, or has been transferred, and the Group has transferred substantially all of the risks and rewards of ownership. Concomitantly, if the asset is one that is measured at: (a) amortised cost, the gain or loss is recognised in the Statement of Profit and Loss; (b) fair value through other comprehensive income, the cumulative fair value adjustments previously taken to reserves are reclassified to the Statement of Profit and Loss unless the asset represents an equity investment in which case the cumulative fair value adjustments previously taken to reserves is reclassified within equity. Income Recognition: Interest income is recognised in the Statement of Profit and Loss using the effective interest method. Dividend income is recognised in the Statement of Profit and Loss when the right to receive dividend is established. Financial Liabilities Borrowings, trade payables and other financial liabilities are initially recognised at the value of the respective contractual obligations. They are subsequently measured at amortised cost. Any discount or premium on redemption / settlement is recognised in the Statement of Profit and Loss as finance cost over the life of the liability using the effective interest method and adjusted to the liability figure disclosed in the Balance Sheet. Financial liabilities are derecognised when the liability is extinguished, that is, when the contractual obligation is discharged, cancelled and on expiry. Offsetting Financial Instruments Financial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Equity Instruments Equity instruments are recognised at the value of the proceeds, net of direct costs of the capital issue ll
|666| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts Chapter 28 Ind AS 110 – Consolidated Financial Statements 1. ALL CARGO LOGISTICS LIMITED The Consolidated Financial Statements (‘CFS’) were authorised for issue in accordance with a resolution of the directors on 22 May 2019. Basis of consolidation The CFS comprise the financial statements of the holding Company and its subsidiaries as at 31 March 2019. The CFS also includes the Group’s share of net assets of the subsidiary and the Group’s share of profits. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has all of the below: a) Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee) b) Exposure, or rights, to variable returns from its involvement with the investee, and c) The ability to use its power over the investee to affect its returns The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary. CFS are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the group uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar circumstances, appropriate adjustments are made to that group member’s financial statements in preparing the consolidated financial statements to ensure conformity with the group’s accounting policies. The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the holding Company, i.e., year ended on 31 March. Consolidation procedure: Combine like items of assets, liabilities, equity, income, expenses and cash flows of the Parent with those of its subsidiaries. For this purpose, income and expenses of the subsidiary are based on the amounts of the assets and liabilities recognised in the consolidated financial statements at the acquisition date. Offset (eliminate) the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary. Business combinations policy explains how to account for any related goodwill. Eliminate in full intra group assets and liabilities, equity, income, expenses and cash flows relating to transactions between entities of the group (profits or losses resulting from intragroup transactions that are recognised in assets, such as inventory and fixed assets, are eliminated in full). Intragroup losses may indicate an impairment that requires recognition in the consolidated financial statements. Ind AS12 Income Taxes applies to temporary differences that arise from the elimination of profits and losses resulting from intragroup transactions.
|667| Chap. 28 – Ind AS 110 – Consolidated Financial Statements Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the holding Company of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it: - Derecognises the assets (including goodwill) and liabilities of the subsidiary - Derecognises the carrying amount of any non- controlling interests - Derecognises the cumulative translation differences recorded in equity - Recognises the fair value of the consideration received - Recognises the fair value of any investment retained - Recognises any surplus or deficit in profit or loss - Reclassifies the parent’s share of components previously recognised in OCI to profit or loss or retained earnings, as appropriate, as would be required if the Group had directly disposed of the related assets or liabilities 2. AMBUJA CEMENTS LIMITED Accounting Policies B. Basis of Consolidation I. The consolidated financial statements comprise those of Ambuja Cements Limited, entities controlled by the Company and its subsidiaries. The list of principal companies is presented in note 43. II. A Company is considered a subsidiary when controlled by the Group. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has: a. Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee), b. Exposure, or rights, to variable returns from its involvement with the investee, and c. The ability to use its power over the investee to affect its returns. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. III. Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: a. The contractual arrangement with the other vote holders of the investee, b. Rights arising from other contractual arrangements, c. The Group’s voting rights and potential voting rights, d. The size of the Group’s holding of voting rights relative to the size and dispersion of the holdings of the other voting rights holders e. Any additional facts and circumstances that indicate that the Group has, or does not have, the current ability to direct the relevant activities at the time when decisions need to be made, including voting patterns at previous shareholders' meetings.
|668| Mandatory Accounting Standards (Ind AS) — Extracts from Published Accounts IV. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary. V. In cases where the financial year of subsidiaries is different from that of the Company, the consolidated financial statements of the subsidiaries have been drawn up so as to be aligned with the financial year of the Company. VI. Consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the group uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar circumstances, appropriate adjustments are made to that group member’s financial statements in preparing the consolidated financial statements to ensure conformity with the group’s accounting policies. VII. Consolidation procedure a. The consolidated financial statements of the Company and its subsidiaries have been prepared in accordance with the Ind AS 110 - Consolidated Financial Statements, on a line-by-line basis by adding together the book value of like items of assets, liabilities, income, expenses and cash flow. b. Offset (eliminate) the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary. Business combinations policy explains how any related goodwill is accounted. c. Eliminate in full intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between entities of the Group (profits or losses resulting from intra-group transactions that are recognised in assets, such as inventory and fixed assets, are eliminated in full). Intragroup losses may indicate an impairment that requires recognition in the consolidated financial statements. Ind AS 12 Income Taxes applies to temporary differences that arise from the elimination of profits and losses resulting from intra-group transactions. VIII. Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group's interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Group. IX. Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the parent of the Group and to the non-controlling interest, even if this results in the noncontrolling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. X. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it: a. Derecognises the assets (including goodwill) and liabilities of the subsidiary, b. Derecognises the carrying amount of any non-controlling interest, c. Derecognises the cumulative translation differences recorded in equity, d. Recognises the fair value of the consideration received, e. Recognises the fair value of any investment retained, or, when applicable, the cost on initial recognition of an investment in an associate or a joint venture,
|669| Chap. 28 – Ind AS 110 – Consolidated Financial Statements f. Recognises any surplus or deficit in the statement of profit and loss, g. Reclassifies the parent’s share of components previously recognised in other comprehensive income (OCI) to the statement of profit and loss or retained earnings, as appropriate, as would be required if the Group had directly disposed of the related assets or liabilities. 3. AVENUE SUPERMARTS LIMITED Basis of consolidation The consolidated financial statements comprise the financial statements of the company and its subsidiaries as at 31st March, 2018. Control is achieved when the group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the group controls an investee if and only if the group has: - Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee) - Exposure, or rights, to variable returns from its involvement with the investee, and - The ability to use its power over the investee to affect its returns; Generally, there is a presumption that a majority of voting rights result in control. To support this presumption and when the group has less than a majority of the voting or similar rights of an investee, the group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: - The contractual arrangement with the other vote holders of the investee - Rights arising from other contractual arrangements - The group’s voting rights and potential voting rights - The size of the group’s holding of voting rights relative to the size and dispersion of the holdings of the other voting rights holders The group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the group obtains control over the subsidiary and ceases when the group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the group gains control until the date the group ceases to control the subsidiary. Consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the group uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar circumstances, appropriate adjustments are made to that group member’s financial statements in preparing the consolidated financial statements to ensure conformity with the group’s accounting policies. The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the parent company, i.e., year ended on 31st March. When the end of the reporting period of the parent is different from that of a subsidiary, the subsidiary prepares, for consolidation purposes, additional financial information as of the same date as the financial statements of the parent to enable the parent to consolidate the financial information of the subsidiary, unless it is impracticable to do so. Consolidation procedure: (a) Combine like items of assets, liabilities, equity, income, expenses and cash flows of the parent with those of its subsidiaries. For this purpose, income and expenses of the subsidiary are based on the amounts of the assets and liabilities recognised in the consolidated financial statements at the acquisition date. (b) Offset (eliminate) the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary. Business combinations policy explains how to account for any related goodwill.