ಕಂಪನಿಯ ಅಕೌಂಟಿಗ್ ಪಾಲಿಸಿ Travel Food Services Ltd.

2B. Material accounting policies

(i) (a) Revenue from contracts with customers

Revenue from contracts with customers is recognised
when control of the goods or services are transferred
to the customer at an amount that reflects the

consideration to which the Company expects to be
entitled in exchange for those goods or services.
Revenue is measured based on the transaction
price, which is fixed consideration specified in a
contract with a customer and excluding taxes or
duties collected on behalf of the government. The
Company has concluded that it is the principal in all
of its revenue arrangements since it is the primary
obligor in all the revenue arrangements as it has
pricing latitude and is also exposed to credit risks.
However, sales tax/ value added tax (VAT)/ Goods
and Service (GST) is not received by the Company
on its own account. Rather, it is tax collected on
value added to the commodity by the seller on
behalf of the government. Accordingly, it is excluded
from revenue. No element of financing is deemed
present as majority of sales are on cash basis and
credit sales are made with normal credit period
consistent with market practice. The following
specific recognition criteria must also be met before
revenue is recognised:

(i) (a) Revenue from contracts with customers

(continued)

Other Operating income

Strategic Tie-up fees

Income from Strategic Tie-up fees primarily
consisting of joining fee, branding and visibility
income which is recognised on accrual basis and
in accordance with the contractual arrangement
entered into with the customer.

Any other operating income

All other revenue is recognised in the period in
which the performance obligation is satisfied at
a point in time.

(b) Contract balances

(A) Contract assets

A contract asset is the right to consideration in
exchange for services rendered to the customer.
If the Company performs by rendering services
to a customer before the customer pays
consideration or before payment is due, a
contract asset is recognised for the earned
consideration that is conditional.

(B) Contract liabilities

A contract liability is the obligation to transfer
services to a customer for which the Company
has received consideration from the customer.
If a customer pays consideration before the
Company renders services to the customer,
a contract liability is recognised when the
payment is made. Contract liabilities are
recognised as revenue when the Company
performs under the contract.

(c) Trade receivables

A trade receivable is recognised if an amount
of consideration is unconditional (i.e., only the
passage of time is required before payment of
the consideration is due). Trade receivables
that do not contain a significant financing
component are measured at transaction
price. Further, refer to accounting policies of
financial assets.

(ii) Interest income

Interest income is recognised using the Effective Interest

Rate (EIR method).

(iii) Dividend Income

Dividend income is recognised in profit or loss on the
date on which the Company''s right to receive payment
is established.

(iv) Employee benefits
Short-term employee benefits

All employee benefits payable wholly within twelve
months of rendering the service are classified as short¬
term employee benefits. The undiscounted amount
of short-term employee benefits expected to be paid
in exchange for the services rendered by employees is
recognised as an expense during the period.

Share-based payment arrangements

The grant date fair value of equity-settled share-based
payment arrangements granted to employees is generally
recognised as an employee benefits expense, with a
corresponding increase in equity, over the vesting period
of the awards. The amount recognised as an expense is
adjusted to reflect the number of awards for which the
related service and non-market performance conditions
are expected to be met, such that the amount ultimately
recognised is based on the number of awards that
meet the related service and non-market performance
conditions at the vesting date. For share-based payment
awards with non-vesting conditions, the grant date fair
value of the share-based payment is measured to reflect
such conditions and there is no true-up for differences
between expected and actual outcomes.

The fair value of the amount payable to employees in
respect of share appreciation rights ("SARs"), which are
settled in cash, is recognised as an employee benefits
expense with a corresponding increase in liabilities,
over the period during which the employees become
unconditionally entitled to payment. The liability is
remeasured at each reporting date and at settlement
date based on the fair value of the SARs. Any changes in
the liability are recognised in profit or loss.

The total expense is recognised over the vesting period,
which is the period over which the specified vesting
conditions are to be satisfied. At the end of each period,
the Company revises its estimates of the number of
options that are expected to vest based on service
conditions. It recognises the impact of the revision to
original estimates, if any, in statement of profit and loss,
with a corresponding adjustment to equity.

When the terms of an equity-settled award are modified,
the minimum expense recognised by the Company is the
grant date fair value of the unmodified award, provided
the vesting conditions (other than a market condition)
specified on grant date of the award are met.

(iv) Employee benefits (continued)

Share-based payment arrangements (continued)

Further, additional expense, if any, is measured and
recognised as at the date of modification, in case
such modification increases the total fair value of the
share-based payment plan, or is otherwise beneficial
to the employee.

Defined contribution plan

The defined contribution plan is a post-employment
benefit plan under which the Company contributes fixed
contribution to a government administered fund and will
have no legal or constructive obligation to pay further
contribution. The Company''s defined contribution plan
comprises of provident fund. The Company''s contribution
to defined contribution plans are recognised in the
statement of profit and loss in the period in which the
employee renders the related services.

Defined benefit plans

The Company has defined benefit plans comprising of
gratuity. Company''s obligation towards gratuity liability
is unfunded. The present value of the defined benefit
obligation is determined based on actuarial valuation
using the projected unit credit method. The rate used
to discount defined benefit Liability is determined by
reference to market yields at the Balance Sheet date
on Indian Government Bonds for the estimated term
of obligations.

Re-measurements comprising of (a) actuarial gains and
losses, and (b) the effect of the asset ceiling, if any,
(excluding amounts included in net interest on the net
defined benefit liability) are recognised immediately in
the balance sheet with a corresponding debit or credit to
retained earnings through Other comprehensive income
in the period in which they occur. Re-measurements
are not reclassified to statement of profit and loss in
subsequent periods.

Gains or losses on the curtailment or settlement are
recognised immediately in profit and loss when the
curtailment or settlement occurs.

Compensated absences

As per the leave Policy of the Company, employees are
entitled to avail 30 days of leave during a calendar year.
At reporting date liability pertaining to compensated
absences is calculated based on the total leave balances
of each employee, as applicable.

(v) Income tax

Income tax expense comprises current and deferred tax.
It is recognised in profit or loss except to the extent that

it relates to a business combination, or items recognised
directly in equity or in Other comprehensive income.

The Company has determined that interest and
penalties related to income taxes, including uncertain
tax treatments, do not meet the definition of income
taxes, and therefore accounted for them under Ind AS 37
Provisions, Contingent Liabilities and Contingent Assets.

Current tax

Current tax comprises the expected tax payable or
receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect
of previous years. The amount of current tax payable or
receivable is the best estimate of the tax amount expected
to be paid or received that reflects uncertainty related to
income taxes, if any. It is measured using tax rates enacted
or substantively enacted at the reporting date.

Current tax assets and liabilities are offset only if there
is a legally enforceable right to set off the recognised
amounts, and it is intended to realise the asset and settle
the liability on a net basis or simultaneously.

Deferred tax

Deferred tax is recognised in respect of temporary
differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the
corresponding amounts used for taxation purposes.
Deferred tax is also recognised in respect of carried
forward tax losses and tax credits.

Deferred tax is not recognised for:

• temporary differences on the initial recognition of
assets or liabilities in a transaction that:

- is not a business combination; and

- at the time of the transaction

(i) affects neither accounting nor taxable
profit or loss and

(ii) does not give rise to equal taxable and
deductible temporary differences

• temporary differences related to investments in
subsidiaries, associates and joint arrangements to
the extent that the Company is able to control the
timing of the reversal of the temporary differences
and it is probable that they will not reverse in the
foreseeable future; and

• taxable temporary differences arising on the initial
recognition of goodwill.

(v) Income tax (continued)

Deferred tax (continued)

Deferred tax assets are recognised for unused tax losses,
unused tax credits and deductible temporary differences
to the extent that it is probable that future taxable profits
will be available against which they can be used. Future
taxable profits are determined based on the reversal of
relevant taxable temporary differences. If the amount of
taxable temporary differences is insufficient to recognise
a deferred tax asset in full, then future taxable profits,
adjusted for reversals of existing temporary differences,
are considered, based on the business plans for individual
subsidiaries in the Company. Deferred tax assets are
reviewed at each reporting date and are reduced to the
extent that it is no longer probable that the related tax
benefit will be realised; such reductions are reversed
when the probability of future taxable profits improves.

Deferred tax is measured at the tax rates that are
expected to apply to the period when the asset is realised
or the liability is settled, based on the laws that have been
enacted or substantively enacted by the reporting date.

The measurement of deferred tax reflects the tax
consequences that would follow from the manner in which
the Company expects, at the reporting date, to recover or
settle the carrying amount of its assets and liabilities. For
this purpose, the carrying amount of investment property
is presumed to be recovered through sale.

Deferred tax assets and liabilities are offset if there is a
legally enforceable right to offset current tax liabilities
and assets, and they relate to income taxes levied by
the same tax authority on the same taxable entity, or on
different tax entities, but they intend to settle current tax
liabilities and assets on a net basis or their tax assets and
liabilities will be realised simultaneously.

(vi) Inventories

Inventories consist of perishable and non-perishables raw
materials and stock in trade which are valued at lower of
cost and net realisable value on item by item basis.

Cost includes purchase price, duties and taxes (other than
those subsequently recoverable by the enterprise from
the taxing authorities), freight cost and other expenditure
incurred in bringing such inventories to their present
location and condition.

Costs of inventories is determined on First In First
Out(FIFO) basis. Provision is made for inventories expired
or not likely to be consumed where considered necessary.

Net realisable value is the estimated selling price in
the ordinary course of business, less estimated costs

of completion and the estimated costs necessary
to make the sale.

(vii) Property, plant and equipment
Recognition and measurement

The cost of an item of property, plant and equipment
shall be recognised as an asset if, and only if it is probable
that future economic benefits associated with the item
will flow to the Company and the cost of the item can be
measured reliably.

Items of property, plant and equipment (including
capital work-in-progress) are measured at cost, which
includes capitalised borrowing costs, less accumulated
depreciation and any accumulated impairment losses.

Cost of an item of property, plant and equipment
comprises its purchase price, including import duties and
non-refundable purchase taxes, after deducting trade
discounts and rebates, any directly attributable cost of
bringing the item to its working condition for its intended
use and estimated costs of dismantling and removing the
item and restoring the site on which it is located.

The cost of a self-constructed item of property, plant and
equipment comprises the cost of materials and direct
labour, any other costs directly attributable to bringing
the item to working condition for its intended use, and
estimated costs of dismantling and removing the item
and restoring the site on which it is located.

If significant parts of an item of property, plant and
equipment have different useful lives, then they are
accounted for as separate items (major components) of
property, plant and equipment.

Any gain or loss on disposal of an item of property, plant
and equipment is recognised in profit or loss.

Transition to Ind AS

The cost of Property, plant and equipment as at 1
April 2022 the Company date of transition to Ind AS,
was determined with reference to its carrying value
recognised as per previous GAAP (deemed cost) as at the
date of transition to Ind AS.

Depreciation

Depreciation is calculated on the cost of items of property,
plant and equipment less their estimated residual values
using the straight-line method over their estimated useful
lives, and is generally recognised in the statement of
profit and loss.

Useful life so estimated are in line with the useful life
indicated by Schedule II to the Companies Act 2013,
except for plant and machinery, office equipments and
furniture and fixtures. Depreciation methods, useful lives

(vii) Property, plant and equipment (continued)
Depreciation (continued)

and residual values are reviewed at each reporting date
and adjusted if appropriate. Based on technical evaluation
and consequent advice, the management believes that
its estimates of useful lives as given above best represent
the period over which management expects to use these
assets. Depreciation is charged on pro rata basis for assets
purchased/sold during the year.

The estimated useful life of items of property, plant and
equipment is mentioned below:

Leasehold improvements are amortised over the useful
life of assets or the lease term, whichever is lower.

Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable
that the future economic benefits associated with the
expenditure will flow to the Company and the cost of
the item can be measured reliably. All other expenses
on existing assets, including day-to-day repair and
maintenance expenditure and cost of replacing parts, are
charged to the Standalone Statement of profit and loss
for the period during which such expenses are incurred.

Derecognition

An item of property, plant and equipment and any
significant part initially recognised is de-recognised
upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or loss
arising on de-recognition of the asset (calculated as
the difference between the net disposal proceeds and
the carrying amount of the asset) is included in the
Standalone Statement of profit and loss when the asset
is de-recognised.

Capital work-in-progress includes the cost of property,
plant and equipment that are not ready for their intended
use as at the Standalone Statement of assets and
liabilities date.

Advance paid for acquisition/ construction of property,
plant and equipment which are not ready for their
intended use at each Standalone Statement of assets and
liabilities date are disclosed as capital advances under
other non-current assets.

(viii) Intangible assets

Recognition and measurement

Intangible assets are carried at cost less accumulated
amortisation and accumulated impairment losses, if any.
Cost includes expenditure that is directly attributable to the
acquisition of the intangible assets. Identifiable intangible
assets are recognised when it is probable that future
economic benefits attributed to the asset will flow to the
Company and the cost of the asset can be reliably measured.

Computer software is capitalised at the amounts paid to
acquire the respective licence for use and are amortised
over the period of its useful lives.

The amortisation expense on intangible assets with finite
lives is recognised in the statement of profit and loss
unless such expenditure forms part of carrying value
of another assets. Amortisation is calculated over their
estimated useful lives using the straight-line method.
Amortisation methods, useful lives and residual values
are reviewed at each reporting date and adjusted if
appropriate. The estimated useful life of intangible assets
is mentioned below:

Franchisee rights are amortised over the useful life of
the contract term.

Transition to Ind AS

The cost of intangible asset as at 1 April 2022 the Company
date of transition to Ind AS, was determined with
reference to its carrying value recognised as per previous
GAAP (deemed cost) as at the date of transition to Ind AS.

Subsequent expenditure

Subsequent expenditure is capitalised only when it increases
the future economic benefits embodied in the specific asset
to which it relates the cost of the asset can be measured
reliably. All other expenditure, including expenditure on

(viii) Intangible assets (continued)

internally generated goodwill and brands, is recognised in
the Standalone Statement of profit and loss as incurred.

Derecognition

An intangible asset is derecognised upon disposal (i.e.,
at the date the recipient obtains control) or when no
future economic benefits are expected from its use or
disposal. Any gain or loss arising upon derecognition of
the asset (calculated as the difference between the net
disposal proceeds and the carrying amount of the asset)
is included in the Standalone Statement of profit and loss.
when the asset is derecognised.

(ix) Financial instruments
I. Financial Assets:

Classification

On initial recognition the Company classifies financial
assets as subsequently measured at amortised cost,
fair value through Other comprehensive income or
fair value through profit or loss on the basis of its
business model for managing the financial assets
and the contractual cash flow characteristics of the
financial asset.

Initial recognition and measurement

All financial assets except trade receivable that
does not contain significant financing component
(not measured subsequently at fair value through
profit or loss) are recognised initially at fair value
plus transaction costs that are attributable to the
acquisition of the financial asset. Purchases or sales
of financial assets that require delivery of assets
within a time frame established by regulation or
convention in the market place (regular way trades)
are recognised on the trade date, i.e., the date that
the Company commits to purchase or sell the asset.

Financial assets at amortised cost

A ''financial asset'' is measured at the amortised cost
if both the following conditions are met:

i) the asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows, and

ii) contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using the

effective interest rate (EIR) method. Amortised cost
is calculated by taking into account any discount
or premium and fees or costs that are an integral
part of the EIR. The EIR amortisation is included in
finance income in the Statement of Profit and Loss.
The losses arising from impairment are recognised
in the Statement of Profit and Loss. This category
generally applies to trade and other receivables,
loans and advances etc.

Financial assets at fair value through profit and loss
(FVTPL)

Financial assets included within the FVTPL category
are measured at fair value with all changes
recognised in the Statement of Profit and Loss.

Derecognition

A financial asset (or, where applicable, a part of a
financial asset or part of a company of similar financial
assets) is primarily derecognised (i.e. removed from
the Company''s financial statements) when:

- The rights to receive cash flows from the asset
have expired, or

- The Company has transferred its rights to
receive cash flows from the asset or has assumed
a liability to pay the received cash flows in full
without material delay to a third party under a
''pass-through'' arrangement; and either:

i) the Company has transferred substantially all
the risks and rewards of the asset, or

ii) the Company has neither transferred nor
retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.

Impairment of financial assets and contract assets

The Company applies expected credit losses (ECL)
model for measurement and recognition of loss
allowance on the following:

i) Trade receivables and contract assets

ii) Financial assets measured at amortised cost
other than trade receivables.

In case of trade receivables and contract assets, the
Company follows a simplified approach wherein
an amount equal to lifetime ECL is measured and
recognised as loss allowance.

The Company computes ECL based on a provision
matrix. The provision matrix is prepared based on
historically observed default rates over the expected

I. Financial Assets: (continued)

Derecognition (continued)

life of trade receivables and is adjusted for forward¬
looking estimates.

Financial assets measured at amortised cost other
than trade receivables are assessed for evidence
of impairment at end of each reporting period
based on monitoring of whether there has been a
significant increase in credit risk. To assess whether
there is a significant increase in credit risk, the
Company compares the risk of a default occurring
on the asset as at the reporting date with the risk
of default as at the date of initial recognition. It
considers available reasonable and supportive
forwarding-looking information. If the credit risk
of such assets has not increased significantly, an
amount equal to 12-month ECL is measured and
recognised as loss allowance.

For a financial asset that is credit-impaired at the
reporting date, ECL is measured as a difference
between gross carrying amount and present value
of estimated future cash flows.

Investments in subsidiaries

Investments in subsidiaries are carried at cost less
accumulated impairment losses, if any. Where
an indication of impairment exists, the carrying
amount of the investment is assessed and written
down immediately to its recoverable amount.
On disposal of investments in subsidiaries, the
difference between net disposal proceeds and the
carrying amounts are recognised in the statement of
profit and loss.

Investment in associates and joint ventures (JV)

Associates are those entities in which the Company
has significant influence, but not control or joint
control over the financial and operating policies.
A joint venture is an arrangement in which the
Company has joint control, whereby the Company
has rights to the net assets of the arrangement,
rather than rights to its assets and liabilities.

II. Financial Liabilities
Classification

The Company classifies all financial liabilities as
subsequently measured at amortised cost, except
for financial liabilities measured at fair value through
profit or loss. Such liabilities shall be subsequently
measured at fair value with changes in fair value
being recognised in the Statement of Profit and Loss.

Initial recognition and measurement

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value.

All financial liabilities are recognised initially at fair
value and, in the case of loans, borrowings and
payables, net of directly attributable transaction
costs. The Company''s financial liabilities include
trade and other payables.

Financial liabilities at amortised cost

After initial recognition, interest-bearing loans and
borrowings and other payables are subsequently
measured at amortised cost using the EIR method.
Gains and losses are recognised in Statement of
Profit and Loss when the liabilities are derecognised.

Amortised cost is calculated by taking into account
any discount or premium on acquisition and fees
or costs that are an integral part of the EIR. The
EIR amortisation is included as finance costs in the
Statement of Profit and Loss.

This category generally applies to interest-bearing
loans and borrowings, trade payables etc.

Derecognition

A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires.

Offsetting of financial instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle
the liabilities simultaneously.

[x) Fair value measurement

The Company measures financial instruments at fair
value in accordance with the accounting policies
mentioned above. Fair value is the price that would be
received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the
measurement date. The fair value measurement is based
on the presumption that the transaction to sell the asset
or transfer the liability takes place either:

a) in the principal market for the asset or liability, or

b) in the absence of a principal market, in the most
advantageous market for the asset or liability

(x) Fair value measurement (continued)

All assets and liabilities for which fair value is measured
or disclosed in These Standalone financial statements are
categorized within the fair value hierarchy that categorizes
into three levels, described as follows, the inputs to
valuation techniques used to measure value. The fair
value hierarchy gives the highest priority to quoted prices
in active markets for identical assets or liabilities (Level
1 inputs) and the lowest priority to unobservable inputs
(Level 3 inputs).

Level 1 — quoted (unadjusted) market prices in active
markets for identical assets or liabilities

Level 2 — inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly or indirectly

Level 3 — inputs that are unobservable for the asset
or liability

(xi) Foreign currency transaction and balances

Foreign currency transactions are translated into
functional currency using the exchange rates at the date
of the transactions. Foreign exchange gains and losses
resulting from the settlement of such transactions and
from the translation of monetary assets and liabilities
denominated in foreign currencies at year end exchange
rates are recognised in the Statement of Profit and Loss.

Foreign exchange gains and losses are presented in the
statement of profit and loss on a net basis within other
income/other expenses.