Page 108 - InterloopAnnualReport2021

NOTES TO THE

FINANCIAL STATEMENTS

For the year ended June 30, 2021

6.7 Stock-in-trade
These are stated at the lower of cost and net realizable value (NRV). The methods used for the calculation
of cost are as follows:

Raw material - At factory Moving average cost
- In transit Invoice value plus direct charges in respect thereof.
Work in process and finished goods Prime cost including a proportion of production overheads.

Wastes are valued at net realizable value.

Stock-in-trade is regularly reviewed by the management and any obsolete items are brought down to
their net realizable value. Net realizable value signifies the selling price in the ordinary course of business
less costs necessary to be incurred to affect such sale.

6.8 Trade debts and other receivables
Trade debts are recognized and carried at the original invoice amounts, being the fair value, less loss
allowance, if any. For measurement of loss allowance for trade debts, the Company applies IFRS 9
simplified approach to measure the expected credit losses.

Other receivables are recognized at amortized cost, less any allowance for expected credit losses.
6.9 Cash and cash equivalents
Cash and cash equivalents comprise of cash in hand, cheques in hand/cheques overdrawn, balances
with banks and include short term highly liquid investments with original maturities of three months or
less. The cash and cash equivalents are readily convertible to known amount of cash and are subject to
insignificant risk of change in value.

6.10 Leases
Right of use assets

At inception, the Company assesses whether a contract is or contains a lease. This assessment involves
the exercise of judgement about whether the Company obtains substantially all the economic benefits
from the use of the asset and whether the Company has a right to direct the use of the asset. The
Company recognizes right of use assets (RoU) at the commencement date of the lease (i.e. the date
the underlying asset is available for use). Right of use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of
RoU includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments
made at or before the commencement date less any lease incentives received.

Unless the Company is reasonably certain to obtain ownership of the leased asset at the end of the lease
term, the recognized right of use assets are depreciated on a straight-line basis over the shorter of its
estimated useful life and the lease term. Depreciation of RoU is charged to statement of profit or loss.
Residual value and the useful life of an RoU are reviewed at least at each financial year-end. Depreciation
on additions to RoU is charged from the month in which an asset is acquired, while no depreciation is
charged for the month in which the asset is disposed off.

Lease liabilities
At the commencement date of the lease, the Company recognizes lease liabilities measured at the
present value of lease payments to be made over the lease term. The lease payments include fixed
payments (including in-substance fixed payments) less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and amounts expected to be paid under residual value
guarantees.

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