Investor Presentaiton
MRP
Cash Generating Unit and the fair value less costs to disposal. For
calculating value in use the Company is required to estimate the
cash flows to be generated from using the asset. The fair value of
an asset is estimated using a valuation technique where observable
prices are not available. Further, the discount rate used in value in
use calculations includes an estimate of risk assessment specific to
the asset. (Refer Note 1 (C 4))
Impairment of Financial Assets:
The Company impairs financial assets other than those measured
at fair value through profit or loss or designated at fair value
through other comprehensive income on expected credit losses.
The estimation of expected credit loss includes the estimation
of probability of default (PD), loss given default (LGD) and the
exposure at default (EAD). Estimation of probability of default
apart from involving trend analysis of past delinquency rates
includes an estimation on forward-looking information relating
to not only the counterparty but also relating to the industry and
the economy as a whole. The probability of default is estimated
for the entire life of the contract by estimating the cash flows that
are likely to be received in default scenario. The lifetime PD is
reduced to 12 months PD based on an assessment of past history
of default cases in 12 months. Further, the loss given default
is calculated based on an estimate of the value of the security
recoverable as on the reporting date. The exposure at default is
the amount outstanding at the balance sheet date. (Refer Note 1
(C 21(a))
Defined Benefit Plans:
The cost of the defined benefit plan and other post-employment
benefits and the present value of such obligations are determined
using actuarial valuations. An actuarial valuation involves making
various assumptions that may differ from actual developments in
the future. These include the determination of the discount rate,
future salary increases, mortality rates and attrition rate. Due to the
complexities involved in the valuation and its long-term nature, a
defined benefit obligation is highly sensitive to changes in these
assumptions. All assumptions are reviewed at each reporting date.
(Refer Note 28 (g))
Fair Value Measurement of Financial Instruments:
When the fair values 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 (DCF) 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. (Refer Note 1 (C 20))
Income Taxes
Significant judgments are involved in determining the provision for
income taxes, including amount expected to be paid/recovered for
uncertain tax positions. (Refer Note 1 (C 17))
In assessing the realizability of deferred income tax assets,
management considers whether some portion or all of the deferred
income tax assets will not be realized. The ultimate realization of
deferred income tax assets is dependent upon the generation of future
taxable income during the periods in which the temporary differences
become deductible. Management considers the scheduled reversals
of deferred income tax liabilities, projected future taxable income
and tax planning strategies in making this assessment. Based on the
level of historical taxable income and projections for future taxable
income over the periods in which the deferred income tax assets are
deductible, management believes that the Company will realize the
benefits of those deductible differences. The amount of the deferred
income tax assets considered realizable, however, could be reduced
in the near term if estimates of future taxable income during the
carry forward period are reduced.
Leases
IND AS 116 requires lessees to determine the lease term as the non-
cancellable period of a lease adjusted with any option to extend or
terminate the lease, if the use of such option is reasonably certain.
The Company makes an assessment on the expected lease term on
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