Page 188 - Interloop Annual Report 2018-2019

NOTES TO THE CONSOLIDATED NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS FINANCIAL STATEMENTS

FOR THE YEAR ENDED JUNE 30, 2019 FOR THE YEAR ENDED JUNE 30, 2019

6.7 Stock-in-trade the discount rate used to measure the defined benefit obligation at the beginning of the annual period
to then-net defined benefit, taking into account any change in the net defined benefit obligation during
These are stated at the lower of cost and net realizable value (NRV). The methods used for the calculation the period as a result of contributions and benefit payments. Net interest expense and other expenses
of cost are as follows: e.g. current service cost, related to defined benefit plans are recognised in profit and loss.

Raw material - At factory Moving average cost (b) Defined Contribution Plan
- In transit Invoice value plus direct charges in respect thereof.
Work in process and finished goods Prime cost including a proportion of production overheads. There is a contributory provident fund for executive staff of the Company for which contributions are
Wastes are valued at net realizable value. charged to profit and loss as and when incurred.

Stock-in-trade is regularly reviewed by the management and any obsolete items are brought down The Company makes monthly contribution to the fund at the rate of 7.5% whereas employees of the
to their net realizable value. Net realizable value signifies the selling price in the ordinary course of Company make monthly contributions to the fund at the rates ranging form 7.5% to 12.5% of basic
business less costs necessary to be incurred to affect such sale. salary. The assets of the fund are held separately under the control of trustees.

6.8 Cash and cash equivalents (c) Employees’ Share Option Scheme (ESOS)

Cash and cash equivalents comprise of cash in hand, cheques in hand/cheques overdrawn, balances The Company operates an equity settled stock option scheme to be called ‘Interloop Limited -
with banks and include short term highly liquid investments. The cash and cash equivalents are readily Employees Stock Option Scheme, 2016’. The compensation committee (“committee”) of the Board of
convertible to known amount of cash and are subject to insignificant risk of change in value. directors (“Board”) evaluates the performance and other criteria of employees and recommends to the
Board for grant of options. The Board on the recommendation of the committee, on its discretion, grants
6.9 Non-current assets held for sale recommended options to employees. These options vest after a specified period subject to fulfillment of
certain conditions as defined in the scheme. Upon vesting, employees are eligible to apply and secure
Non-current assets (or disposal groups) are classified as assets held for sale when their carrying allotment of Company’s shares at a pre-determined price on the date of grant of options.
amount is to be recovered principally through a sale transaction rather than continuing use and a sale
is considered highly probable. They are stated at the lower of carrying amount and fair value less costs The fair value of the grant of share options is measured at grant date and difference of fair value and
to sell. Impairment losses on initial classification as held for sale and subsequent gains or losses on re- exercise price is recognized as an employee compensation expense, with a corresponding increase
measurements are recognized in the statement of profit or loss. in equity, on the straight line basis over the vesting period. The amount recognized as an expense is
adjusted to reflect the number of awards for which the related service and non-market performance
Once classified as held-for-sale, intangible assets and property, plant and equipment, are no longer conditions are expected to be met, such that the amount ultimately recognized is based on the number
amortised or depreciated. of awards that meet the related service and non- market performance conditions at the vesting date.

6.10 Staff retirement benefits When share options are exercised, the proceeds received, net of any transaction costs, are credited to
share capital (nominal value) and share premium.
(a) Defined Benefit Plan
6.11 Trade and other payables
The Company operates an unfunded gratuity scheme for all employees according to the terms of
employment, subject to a minimum qualifying period of service. Annual provision is made on the basis Trade and other payables are initially recognized at fair value and subsequently at amortized cost using
of actuarial valuation to cover obligations under the scheme for all employees eligible to gratuity benefits. effective interest rate method. Exchange gains and losses arising on translation in respect of liabilities
in foreign currency are added to the carrying amount of the respective liabilities.
The cost of providing benefits is determined using the projected unit credit method, with actuarial
valuation being carried out at each balance sheet date. Remeasurement of net defined benefit liability, 6.12 Ijarah
which comprise of actuarial gains and losses i.e. experience adjustments and the effects of changes 2018 - 19
Interloop Limited in actuarial assumptions, are recognised immediately in other comprehensive income. The Company Ijarah payments under an Ijarah are recognized as an expense in the statement of profit or loss on a Annual Report

determines net interest expense/(income) on the defined benefit obligation for the period by applying

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