‘MedPlus Health Services Limited (formerly known as MedPlus Health Services Private Limited)
Annexure: V

‘Summary of Significant Accounting Policies

(All amounts are in Rs. i millions except as otherwise stated)

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Summary of significant accounting policies (continued)
Significant accounting, estimates and assumptions (continued)

Fair value measurement of financial instruments

‘When the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is
measured using valuation techniques including the Discounted Cash Flow model. The inputs to these models are taken from observable markets where possible, but where
this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility
Changes in assumptions about these factors could affect the reported fair value of financial instruments,

Leases
‘The Group evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease requires significant judgement, The Group uses
significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount rate

‘The Group determines the lease term as the non-cancellable period of a lease, together with both periods covered by an option to extend the lease of the Group is reasonably
certain to exercise that option and periods covered by an option to terminate the lease if the Group is reasonably certain not to exercise that option. In assessing whether the
Group is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate the lease, it considers all relevant facts and circumstances that
create an economic incentive for the Group to exercise the option to extend the lease, oF not to exercise the option to terminate the lease, The Group revises the lease term if
there is a change in the non-cancellable period of a lease.

‘The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio of leases with similar characteristics,

Inventories
‘The Group estimates the net realisable value (NRV) of its inventories by taking into account their estimated selling price, estimated cost of completion, estimated costs
necessary to make the sale, obsolescence by applying certain percentages over different age category of such inventories, expected loss rate considering the past trend and
future outlook. Inventories are written down to NRV where such NRV is lower than their cost.

 

Business combination and goodwill
Business combinations arising from transfers of interests in entities that are under the control of the shareholder that controls the Group are accounted for as ifthe acquisition
had occurred at the beginning of the preceding period in the financial statements or, if later, at the date that common control was established; for this purpose comparatives
are revised. The assets and liabilities acquired are recognised at their carrying amounts. The identity of the reserves is preserved, and they appear in the standalone financial
statements of the Group in the same form in which they appeared in the financial statements of the acquired entity. The difference, if any, between the consideration and the
amount of share capital of the acquired entity is transferred to capital reserve.

Current and non current classification
‘The Group presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when itis:

= Expected to be realised or intended to be sold or consumed in normal operating cycle
Held primarily for the purpose of trading

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

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

All other assets are classified as non-current.

A liability is current when
= Itis expected to be settled in normal operating cycle

- It is held primarily for the purpose of trading

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

- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period
‘The Group classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.
‘The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, The Group has identified twelve months as
its operating cycle.

Foreign currencies

Initial recognition

‘Transactions in foreign currencies are translated into functional currency of the Group at the exchange rates at the dates of the transactions or an average rate if the average
rate approximates the actual rate at the date of the transaction,

Conversion
Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the functional currency at the exchange rate at that date. Non-
‘monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction, Non-monetary items that are
‘measured at fair value in a foreign currency are translated using the exchange rates at the date when the fait value was measured,

 

Exchange differences
Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial
recognition during the period or in previous financial statements are recognised in the statement of profit and loss inthe period in which they arise,

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