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F-81
Interests in joint arrangements
A joint arrangement is an arrangement of which two or more parties have joint control. Joint control is the contractually agreed sharing of control of
an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.
Joint operations
Certain of the Company’s activities, are conducted through joint operations, which are joint arrangements whereby the parties that have joint
control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. The Company recognizes, in the
consolidated financial statements, its share of the assets, liabilities, income and expenses of these joint operations incurred jointly with the other
partners, along with its share of income from the sale of the output and any assets, liabilities and expenses that it has incurred in relation to the joint
operation.
Joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
The results, assets and liabilities of a joint venture are incorporated in these financial statements using the equity method of accounting as described
below.
Associates
Associates are those entities in which the Company has significant influence. Significant influence is the power to participate in the financial and
operating policy decisions of the investee but not control or joint control those policies. Significant influence is presumed to exist when the Company
holds between 20 and 50 percent of the voting power of another entity. The results, assets and liabilities of associates are incorporated in these
financial statements using the equity method of accounting as described below.
Equity method of accounting (equity accounted investees)
An interest in an associate or joint venture is accounted for using the equity method from the date in which the investee becomes an associate or
a joint venture and are recognized initially at cost. The Company’s investment includes goodwill identified on acquisition, net of any accumulated
impairment losses.The consolidated financial statements include the Company’s share of profits or losses and equity movements of equity accounted
investees, from the date that significant influence or joint control commences until the date that significant influence or joint control ceases. When
the Company’s share of losses exceeds its interest in an equity accounted investee, the carrying amount of that interest (including any long-term
investments in the nature of net investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the
Company has an obligation or has made payments on behalf of the investee.
When the Company transacts with an associate or joint venture of the Company, unrealized profits and losses are eliminated to the extent of the
Company’s interest in its associate or joint venture.
d. Business combination
Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. Acquisition related costs are recognized in profit or loss
as incurred. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition are recognized at their fair
value at the acquisition date, except certain assets and liabilities required to be measured as per the applicable standard.
Purchase consideration in excess of the Company’s interest in the acquiree’s net fair value of identifiable assets, liabilities and contingent liabilities is
recognized as goodwill. Excess of the Company’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities
over the purchase consideration is recognized, after reassessment of fair value of net assets acquired, in the Capital Reserve.
e. Use of estimates and judgments
The preparation of financial statements in conformity with Ind AS requires management to make judgments, estimates and assumptions, that affect
the application of accounting policies and the reported amounts of assets, liabilities, income, expenses and disclosures of contingent assets and
liabilities at the date of these financial statements and the reported amounts of revenues and expenses for the years presented. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed at each balance sheet date. Revisions to accounting estimates are recognised in the period in
which the estimate is revised and future periods affected.
In particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have the most
significant effect on the amounts recognized in the financial statements are included in the following notes:
i)
Note 5 - Impairment of goodwill
ii)
Note 6 - Impairment of indefinite life intangible assets
iii)
Note 20 - Recoverability/recognition of deferred tax assets
iv) Note 28 - Provision for product warranty
v)
Note 36 - Assets and obligations relating to employee benefits
NOTES FORMING PART OF CONSOLIDATED FINANCIAL STATEMENTS