Fair value hierarchy:
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consists of the following three levels:
Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2— Inputs are other than quoted prices included within Level1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3—Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.
30. Financial risk management
The Company is exposed to various risks such as credit risk, liquidity risk and market risk.
i. Credit risk
Credit risk arises due to customer’s failure to repay the debts according to the contractual terms and conditions. It consists of two elements viz. risk of default in payment and decrease in the creditworthiness of the customers. Credit risk is controlled by analyzing credit limits and creditworthiness of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit.
Since the Company is not engaged in Exports, it is not exposed to risk associated with other geographies.
ii. Market risk
The risk that the fair value of the financial instrument may fluctuate because of change in market conditions. Such changes in the values of financial instruments may result from changes in the interest rates, credit, liquidity and other market changes.
Since most of the liquid funds are parked as deposits with maturity of less than three months, the Company is exposed to the interest risk.
iii. Liquidity risk
Maintaining enough balance of cash and marketable securities is essential to meet the obligation when due. Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company consistently generated sufficient cash flows from operations to meet its financial obligations as and when they fall due. However, the Company is exposed to liquidity risk as its current financial liabilities are significantly higher than the current financial assets (excluding current tax assets). The details are as follows:
31. Foreign exchange earnings and outgo:
The earnings and outgo in foreign currency is Rs. Nil for March 31,2024 (March 31,2023 - Rs. Nil).
32. Contingent liability:
The Contingent liability as at March 31,2024 is Rs. Nil (March 31,2023 - Rs. Nil).
33. Details of dues to micro and small enterprises as defined under MSMED Act, 2006
There are no defaults and overdue amounts payable to suppliers, who have intimated about their status as Micro and Small Enterprises as per the provisions of Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).
34. Capital commitments:
The capital commitment as at March 31,2024 is Rs. Nil (March 31,2023 - Rs. Nil).
36. Previous periods / year’s figures have been regrouped where necessary to conform to current period’s classification.