ಕಂಪನಿಯ ಅಕೌಂಟಿಗ್ ಪಾಲಿಸಿ Sahaj Solar Ltd.

1 COMPANY INFORMATION

Founded with the objective of contributing towards sustainable and clean energy solutions, Sahaj Solar Ltd. has been engaged in the research and development of solar technologies since 2007. The Company received approval from the International Electrotechnical Commission (IEC) in 2010 and is recognized by the Ministry of New and Renewable Energy (MNRE) as a solar panel manufacturer in India. The Company is committed to delivering world-class products and innovative energy solutions with a strong focus on quality, technology, and customer satisfaction. With expertise in Crystalline Photovoltaic Technology, Sahaj Solar specializes in the manufacturing of Solar PV Modules and provides comprehensive Engineering, Procurement and Construction (EPC) services, including system designing and execution of solar power projects. Over the years, Sahaj Solar has established itself as a reliable provider of high-quality solar products and EPC solutions across India. The Company ’ s project implementation approach emphasizes prolonged equipment life, operational efficiency, and optimum return on investment for its clients. Further, the Company utilizes remote monitoring systems that enable customers to monitor plant performance effectively and undertake timely preventive measures for efficient operations. Sahaj Solar continues to work towards promoting green energy adoption through innovation, technical expertise, and sustainable business practice s.

2 SIGNIFICANT ACCOUNTING POLICIES a Basis of Preparation

These financial statements have been prepared in accordance with the Generally Accepted Accounting Principles in India (‘Indian GAAP’) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, as applicable. The financial statements have been prepared under the historical cost convention on accrual basis, except for certain financial instruments which are measured at fair value.

b Use of Estimates

The preparation of financial statements requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to the contingent liabilities as at the date of the financial statements and reported amounts of income and expense during the year. Examples of such estimates include provisions for doubtful receivables, provision for income taxes, the useful lives of depreciable Property, Plant and Equipment and provision for impairment. Future results could differ due to changes in these estimates and the difference between the actual result and the estimates are recognised in the period in which the results are known / materialise.

c Property, Plant and Equipment

Property, Plant and Equipment are stated at cost, less accumulated depreciation. Costs include all expenses incurred to bring the asset to its present location and condition.

d Intangible assets

Intangible assets are stated at cost, less accumulated amortisation. e Depreciation and amortization

In respect of Property, Plant and Equipment (other than freehold land and capital work-in-progress) acquired during the year, depreciation is charged on Written down value basis so as to write-off the cost of the assets over the useful lives. Intangible Assets amortized over the year on Straight Line Method Basis.

The useful life of the Assets has been taken as below;

Computers 3 Years

f Impairment of assets

At each balance sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment. Recoverable amount is the higher of an asset’s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the asset and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the asset. Reversal of impairment loss is recognised as income in the statement of profit and loss.

g Leases

Assets taken on lease by the Company in its capacity as lessee, where the Company has substantially all the risks and rewards of ownership are classified as finance lease. Such a lease is capitalised at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is recognised for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor, are recognised as operating leases. Lease rentals under operating leases are recognised in the statement of profit and loss on a straight-line basis.

h Investment

Long-term investments and current maturities of long-term investments are stated at cost, less provision for other than temporary diminution in value. Current investments, except for current maturities of long-term investments, comprising investments in mutual funds, government securities and bonds are stated at the lower of cost and fair value.

i Inventories

The Company is in business of manufacturing of Solar Panel and Power Generating System. The Company is following historical system of Cost Accounting to determine the cost of production/operation, cost of sales, sales realization and margin separately for each product/activity and also for each product. The company is maintaining integrated costing and finance system in computer-based software ERP. At the end of the year cost statements are prepared separately for each product/activity. The cost statements are in line with the process of manufacture and methodology is reasonably correct for cost determination of the products and activities as per FORM CRA -1 of the Companies (Cost Records and Audit) Amendment Rules, 2014 and varouis amendment made to the rules time to time. Overheads are mainly divided in (i) Production Overheads, (ii) Administration and Corporate Overheads, (iii) Selling & Distribution Overheads and (iv) Finance Overheads. The Production Overheads are segregated between fixed expense and variable expense. Fixed expenses are recovered on products on the basis of turnover. While variable expenses are recovered on the products on the basis of turnover. Other Overheads are allocated to products on the bases of turnover.

j Cash and cash equivalents

The Company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents.

k Revenue recognition

The Company manufactures and sells a solar panels as well as is also engaged in supply of solar power generating system, solar water pumping system, solar roof top and other renewable energy devices.

Revenue from sale of products is recognised when control of the products has transferred, being when the products are delivered to the customer. Delivery occurs when the products have been shipped or delivered to the specific location as the case may be, the risks of loss has been transferred, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance have been satisfied. Sale of products include related ancillary services, if any. Revenue from sales is recognised when the significant risks and rewards associated with ownership of goods are transferred to the buyers and no significant uncertainty exists as to the amount of consideration derived from the sales.

When the goods are supplied along with ‘warranty’ provision for a period which is beyond the balance sheet date, the company defers recognition of revenue for which service portion is covered over the period which is beyond the balance sheet date and recognizes the same evenly over the time period for which it is involved. The ‘deferred income’ reported in financials represents the recognition of revenue for which supply of goods has taken place in earlier periods.

Supply of Services:

* With respect to services, the revenues are recognized on completion of assignment and that there is no uncertainity in its ultimate collection.

* No element of financing is deemed present as the sales are generally made with a credit term of 30-90 days, which is consistent with market practice. A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

l Employee Benefits

Post-employment benefit plans

Contributions to defined contribution retirement benefit schemes are recognised as expense when employees have rendered services entitling them to such benefits.

For defined benefit schemes, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in full in the statement of profit and loss for the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested, or amortised on a straight-line basis over the average period until the benefits become vested.

The retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, and as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to the present value of available refunds and reductions in future contributions to the scheme.

Other employee benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognised during the period when the employee renders the service. These benefits include compensated absences such as paid annual leave, overseas social security contributions and performance incentives.

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as an actuarially determined liability at the present value of the defined benefit obligation at the balance sheet date.

m Borrowing Cost

The company capitalised the interest on qualifying asset whenever applicable otherwise it is expense off in the profit & loss statement.

n Foreign currency transactions

Income and expense in foreign currencies are converted at exchange rates prevailing on the date of the transaction. Foreign currency monetary assets and liabilities other than net investments in non-integral foreign operations are translated at the exchange rate prevailing on the balance sheet date and exchange gains and losses are recognised in the statement of profit and loss. Exchange difference arising on a monetary item that, in substance, forms part of an enterprise’s net investments in a non-integral foreign operation are accumulated in a foreign currency translation reserve.

o Taxation

Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and is likely to reverse in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

Advance taxes and provisions for current income taxes are presented in the balance sheet after off-setting advance tax paid and income tax provision arising in the same tax jurisdiction for relevant tax paying units and where the Company is able to and intends to settle the asset and liability on a net basis.

The Company offsets deferred tax assets and deferred tax liabilities if it has a legally enforceable right and these relate to taxes on income levied by the same governing taxation laws.

Current income tax expense comprises taxes on income from operations in India. Income taxpayable in India is determined in accordance with the provisions of the Income Tax Act, 1961.

p Government Grants

Government grants are recognized when there is reasonable assurance that the Company will comply with the conditions attached to the grants and that the grants will be received. Government grants are accounted for in accordance with the applicable Accounting Standards. Grants related to revenue are recognized in the Statement of Profit and Loss on a systematic basis over the periods in which the Company recognizes the related costs for which the grants are intended to compensate. Such grants are presented under “Other Operating Income” or deducted from the related expense, as applicable. Government grants related to specific fixed assets are either deducted from the gross value of the respective assets or treated as deferred income and recognized in the Statement of Profit and Loss over the useful life of the related asset in proportion to the depreciation charged. Export incentives, subsidies and other government assistance are recognized when there is reasonable certainty regarding ultimate collection and compliance with the attached conditions. Any grant received as compensation for expenses or losses already incurred or for immediate financial support, with no future related costs, is recognized in the Statement of Profit and Loss in the period in which it becomes receivable.

q Earnings Per Shares

Basic earning per share is computed by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Diluted earning per share is computed by taking into account the weighted average number of equity shares outstanding during the period and the weighted average number of equity shares which would be issued on conversion of all dilutive potential equity shares into equity shares.

r Provisions, Contingent liabilities and Contingent assets

A provision is recognised when the Company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. Provisions (excluding retirement benefits and compensated absences) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Contingent liabilities are not recognised in the financial statements. A contingent asset is neither recognised nor disclosed in the financial statements.

1 COMPANY INFORMATION

Sahaj Solar Ltd. (Sahaj Solar) is synonyms to acquire green energy in a natural simple way. Sahaj Solar is founded with a humble objective of contributing company''s efforts for the betterment of mankind. Sahaj has initiated R&D on solar technologies in 2007 and since 2010 Company is International Electrotechnical Commission (IEC) approved, Ministry of New and Renewable Energy (MNRE) recognized Solar Panel Manufacturer in India. From day one company has focused on quality and innovations. Companies one of the expertise is Crystalline Photovoltaic Technology used for manufacturing Solar PV Modules. Sahaj also engaged in system Designing and Engineering, Procurement and Construction (EPC) services. Sahaj is based in western part of India having offices across Pan India and Africa. Sahaj supplies qualitative products and provide EPC Services all over India and in Africa. Sahaj''s team undertakes project implementation with two most important aspects - prolonged life of the equipment and optimum return on investment. The remote monitoring system helps the clients to monitor performance and take pre-emptive measures

2 SIGNIFICANT ACCOUNTING POLICIES a Basis of Preparation

These financial statements have been prepared in accordance with the Generally Accepted Accounting Principles in India (''Indian GAAP'') to comply with the Accounting Standards specified under Section 133 of the Companies Act 2013, as applicable. The financial statements have been prepared under the historical cost convention on accrual basis, except for certain financial instruments which are measured at fair value.

b Use of estimates

The preparation of financial statements requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to the contingent liabilities as at the date of the financial statements and reported amounts of income and expense during the year. Examples of such estimates include provisions for doubtful receivables, provision for income taxes, the useful lives of depreciable Property, Plant and Equipment and provision for impairment. Future results could differ due to changes in these estimates and the difference between the actual result and the estimates are recognised in the period in which the results are known / materialise.

c Property, Plant and Equipment

Property, Plant and Equipment are stated at cost, less accumulated depreciation / amortisation. Costs include all expenses incurred to bring the asset to its present location and condition.

d Depreciation / amortisation

In respect of Property, Plant and Equipment (other than freehold land and capital work-in-progress) acquired during the year, depreciation is charged on Written down value basis so as to write-off the cost of the assets over the useful lives. Intangible Assets amortized over the year on Straight Line Method Basis.

e Impairment

At each balance sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment. Recoverable amount is the higher of an asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the asset and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the asset. Reversal of impairment loss is recognised as income in the statement of profit and loss.

f Investments

Long-term investments and current maturities of long-term investments are stated at cost, less provision for other than temporary diminution in value. Current investments, except for current maturities of long-term investments, comprising investments in mutual funds, government securities and bonds are stated at the lower of cost and fair value.

g Revenue recognition

The Company manufactures and sells a solar panels as well as is also engaged in supply of solar power generating system, solar water pumping system, solar roof top and other renewable energy devices.

Revenue from sale of products is recognised when control of the products has transferred, being when the products are delivered to the customer. Delivery occurs when the products have been shipped or delivered to the specific location as the case may be, the risks of loss has been transferred, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance have been satisfied. Sale of products include related ancillary services, if any. Revenue from sales is recognised when the significant risks and rewards associated with ownership of goods are transferred to the buyers and no significant uncertainty exists as to the amount of consideration derived from the sales.

« When the goods are supplied along with ''warranty'' provision for a period which is beyond the balance sheet date, the company defers recognition of revenue for which service portion is covered over the period which is beyond the balance sheet date and recognizes the same evenly over the time period for which it is involved. The ''deferred income'' reported in financials represents the recognition of revenue for which supply of goods has taken place in earlier periods.

Supply of Services:

* With respect to services, the revenues are recognized on completion of assignment and that there is no uncertainity in its ultimate collection.

* No element of financing is deemed present as the sales are generally made with a credit term of 30-90 days, which is consistent with market practice. A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

h Taxation

Current income tax expense comprises taxes on income from operations in India . Income taxpayable in India is determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and is likely to reverse in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

Advance taxes and provisions for current income taxes are presented in the balance sheet after off-setting advance tax paid and income tax provision arising in the same tax jurisdiction for relevant tax paying units and where the Company is able to and intends to settle the asset and liability on a net basis.

The Company offsets deferred tax assets and deferred tax liabilities if it has a legally enforceable right and these relate to taxes on income levied by the same governing taxation laws.

i Foreign currency transactions

Income and expense in foreign currencies are converted at exchange rates prevailing on the date of the transaction. Foreign currency monetary assets and liabilities other than net investments in non-integral foreign operations are translated at the exchange rate prevailing on the balance sheet date and exchange gains and losses are recognised in the statement of profit and loss. Exchange difference arising on a monetary item that in substance, forms part of an enterprise''s net investments in a non-integral foreign operation are accumulated in a foreign currency translation reserve.

j Inventories

The Company is in business of manufacturing of Solar Panel and Power Generating System. The Company is following historical system of Cost Accounting to determine the cost of production/operation, cost of sales, sales realization and margin separately for each product/activity and also for each product The company is maintaining integrated costing and finance system in computer based software ERP. At the end of the year cost statements are prepared separately for each product/activity. The cost statements are in line with the process of manufacture and methodology is reasonably correct for cost determination of the products and activities as per FORM CRA -1 of the Companies (Cost Records and Audit) Amendment Rules, 2014 and varouis amendment made to the rules time to time. Overheads are mainly divided in (i) Production Overheads, (ii) Administration and Corporate Overheads, (iii) Selling 8t Distribution Overheads and (iv) Finance Overheads. The Production Overheads are segregated between fixed expense and variable expense. Fixed expenses are recovered on products on the basis of turnover. While variable expenses are recovered on the products on the basis of turnover. Other Overheads are allocated to products on the bases of turnover

k Provisions, Contingent liabilities and Contingent assets

A provision is recognised when the Company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. Provisions (excluding retirement benefits and compensated absences) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Contingent liabilities are not recognised in the financial statements. A contingent asset is neither recognised nor disclosed in the financial statements.

I Cash and cash equivalents

The Company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents.