. Financial statements of an associate or joint venture are prepared for the same reporting period as for our
Company. When necessary, adjustments are made to bring the accounting policies in line with those of
our Company.

. The consolidated financial statements have been prepared using uniform accounting policies for like
transactions and other events in similar circumstances and are presented to the extent possible, in the
same manner, as the Company’s separate financial statements.

Estimation of uncertainties relating to the global health pandemic from COVID-19

The COVID-19 pandemic has impacted the businesses around the world, including India. There has been severe
disruption to our regular operations in the first quarter of Fiscal 2021 due to Government imposed emergency
restrictions and lockdown.

We have assessed the impact on liquidity position and carrying amounts of inventories, trade receivables,
investments, property, plant and equipment and other financial assets. Our assessment based on estimates and
judgements, available from internal and external sources of information including economic forecasts does not
indicate any material impact on the carrying value of assets and liabilities as on the reporting date.

We will continue to monitor the future economic conditions and assess its impact on the financial statements. The
eventual outcome of the impact of the global health pandemic may be different from those estimated as on date
of the approval of the consolidated financial statements.

Property Plant and Equipment

All Property Plant & Equipment barring land as at transition date are stated at cost of acquisition / installation as
adjusted for import duty waivers and foreign exchange losses / gains less accumulated depreciation and
impairment losses.

Cost of acquisition / installation includes the fair value of the consideration given to acquire the PPE (net of
discounts and rebates) and any directly attributable costs of bringing the asset to working condition for its intended
use (inclusive of non-refundable purchase taxes and duties).

Foreign exchange gain or loss arising on unhedged foreign currency denominated borrowing taken to acquire
property, plant and equipment are recorded in the cost of asset and depreciated over their remaining useful life. In
respect of exchange gain or loss arising from foreign currency denominated borrowings which are hedged,
accounting has been done based on hedge effectiveness either as derivative or cash flow hedge.

We capitalize the import duty waived in respect of capital equipment imported under the Export Promotion Capital
Goods Scheme.

Foreign exchange gain /loss arising on foreign currency denominated borrowing which are not hedged that were
incurred to acquire PPE are recorded as part of the cost of asset and depreciated over their remaining useful life.
In respect of exchange gain or loss arising from foreign currency denominated borrowings which are hedged
accounting has been done based on hedge effectiveness either as derivative or cash flow hedge

Depreciation on Plant Property and Equipment

The depreciable amount of property, plant and equipment, being the gross carrying value less the estimated
residual value, is depreciated on a systematic basis over its useful life.

In respect of certain classes of property, plant and equipment, we use different useful life other than those
prescribed under law. The useful life of such class of property, plant and equipment has been ascertained based
on technical review by a chartered engineer and assessment by our management, as detailed in the following table:

 

Classes of Property, Plant and Equipment Useful life and Basis of Depreciation
New Plant and Machinery 20 years
Used Plant and Machinery 10 years

Tool holder, jigs, fixtures, patterns, dies, molds and 5 years
instruments and gauges
Lease hold improvements Over lease period

 

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