Investor Presentaiton
MRP
A distribution is authorized when it is approved by the
shareholders. A corresponding amount is recognised directly
in other equity.
12) Cash Flows and Cash and Cash Equivalents:
13)
Statement of cash flows is prepared in accordance with the
indirect method prescribed in the relevant IND AS. For the
purpose of presentation in the statement of cash flows, cash
and cash equivalents includes cash on hand, cheques and
drafts on hand, deposits held with Banks, other short-term,
highly liquid investments with original maturities of three
months or less that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of changes
in value, and book overdrafts. However, Book overdrafts are
to be shown within borrowings in current liabilities in the
balance sheet for the purpose of presentation.
Revenue Recognition:
The Company derives revenues primarily from sale of goods
comprising of Automobile Tyres, Tubes, Flaps and Tread
Rubber. The following is a summary of significant accounting
policies related to revenue recognition:
Revenue from contract with customers is recognised upon
transfer of control of promised products or services to
customers in an amount that reflects the consideration the
Company expects to receive in exchange for those products or
services.
Revenue from the sale of goods is recognised at the point in
time when control is transferred to the customer.
Revenue towards satisfaction of a performance obligation is
measured at the amount of transaction price (net of variable
consideration) allocated to that performance obligation. The
transaction price of goods sold and services rendered is net
of variable consideration on account of turnover/product/
prompt payment discounts and schemes offered by the
company as part of the contract with the customers. When
the level of discount varies with increase in levels of revenue
transactions, the Company recognises the liability based on
its estimate of the customer's future purchases. The Company
recognises changes in the estimated amounts of obligations
for discounts in the period in which the change occurs.
Revenue also excludes taxes collected from customers.
Revenue in excess of invoicing is classified as contract assets
while invoicing in excess of revenues are classified as contract
liabilities.
The Company provides warranties for general repairs and does
not provide extended warranties or maintenance services in its
contracts with customers and are assurance type warranties.
Claims preferred during the year against such obligations are
netted off from revenue, consistent with its current practice.
Provision for warranties is made for probable future claims
on sales effected and are estimated based on previous claim
experience and are accounted for under IND AS 37 Provisions,
Contingent Liabilities and Contingent Assets, consistent with its
current practice.
Use of significant judgements in Revenue Recognition:
Judgement is also required to determine the transaction
price for the contract. The transaction price could
be either a fixed amount of consideration or variable
consideration with elements such as turnover/product/
prompt payment discounts. Any consideration payable
to the customer is adjusted to the transaction price,
unless it is a payment for a distinct product or service
from the customer. The estimated amount of variable
consideration is adjusted in the transaction price only
to the extent that it is highly probable that a significant
reversal in the amount of cumulative revenue
recognised will not occur and is reassessed at the end
of each reporting period.
The Company exercises judgement in determining
whether the performance obligation is satisfied at a point
in time or over a period of time. The Company considers
indicators such as how customer consumes benefits as
services are rendered or who controls the asset as it is
being created or existence of enforceable right to payment
for performance to date and alternate use of such product
or service, transfer of significant risks and rewards to the
customer, acceptance of delivery by the customer.
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