Investor Presentaiton
MRP
measure fair value, maximizing the use of relevant observable
inputs and minimizing the use of unobservable inputs.
All financial assets and financial liabilities for which fair
value is measured or disclosed in the Financial Statements
are categorized within the fair value hierarchy, described as
follows, based on the lowest level input that is significant to
the fair value measurement as a whole:
Level 1-Quoted (unadjusted) market prices in active markets
for identical assets or liabilities.
Level 2
Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
directly or indirectly observable.
Level 3
Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
Financial assets and financial liabilities that are recognized at
fair value on a recurring basis, the Group determines whether
transfers have occurred between levels in the hierarchy by re-
assessing categorization at the end of each reporting period.
21) 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. The Group recognizes a financial asset or
financial liability in its balance sheet only when the entity
becomes party to the contractual provisions of the instrument.
Financial Assets
a)
A financial asset inter-alia includes any asset that is cash,
equity instrument of another entity or contractual rights
to receive cash or another financial asset or to exchange
financial asset or financial liability under condition that
are potentially favourable to the Group.
Financial assets other than investment in Subsidiaries
Financial assets of the Group comprise trade receivable,
cash and cash equivalents, Bank balances, Investments
in equity shares of companies other than in Subsidiaries,
investment in units of Mutual Funds, loans/advances
to employee related parties / others, security deposit,
claims recoverable etc.
Initial recognition and measurement
All financial assets are recognized 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. However, Trade receivables that do not contain
a significant financing component are measured at
Transaction Price. Transaction costs of financial assets
carried at fair value through profit or loss are expensed
in Consolidated statement of profit and loss. Where
transaction price is not the measure of fair value and
fair value is determined using a valuation method
that uses data from observable market, the difference
between transaction price and fair value is recognized in
Consolidated statement of profit and loss on the date of
recognition if the fair value pertains to Level 1 or Level
2 of the fair value hierarchy and in other cases spread
over life of the financial instrument using effective interest
method.
Subsequent measurement
For purposes of subsequent measurement financial
assets are classified in three categories:
Financial assets measured at amortized cost
Financial assets at fair value through OCI - Debt
Instruments
Financial assets at fair value through profit or loss
Financial assets measured at amortized cost
Financial assets are measured at amortized cost if the
financial asset is held within a business model whose
objective is to hold financial assets in order to collect
contractual cash flows and the contractual terms of the
financial asset give rise on specified dates to cash flows
that are solely payments of principal and interest on the
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