Atul Ltd 2019-20

Corporate Overview Statutory Reports Financial Statements 216 Atul Ltd | Annual Report 2019-20 01-21 22-91 92-228 Note 29.8 Financial risk management (continued) As at March 31, 2019 ( ` cr) Type of hedge Change in the value of the hedging instrument recognised in other comprehensive income Hedge ineffectiveness recognised in profit or loss Amount reclassified from cash flow hedging reserve to profit or loss Financial Statement line item affected Cash flow hedge Foreign exchange risk 1.22 - 0.05 Trade receivables and payables Movements in cash flow hedging reserve ( ` cr) Risk category Foreign currency risk Derivative instruments As at March 31, 2020 As at March 31, 2019 Balance at the beginning of the year 0.79 0.03 Gain | (Loss) recognised in other comprehensive income during the year (1.62) 1.22 Amount reclassified to revenue during the year (1.22) (0.03) Tax impact on above 0.41 (0.43) Balance at the end of the year (1.64) 0.79 Note 29.9 Capital management Risk Management The primary objective of capital management of the Group is to maximise shareholder value. The Group monitors capital using debt-equity ratio which is total debt divided by total equity. For the purpose of capital management, the Group considers the following components of its Balance Sheet to manage capital: Total equity includes general reserve, retained earnings, share capital, security premium. Total debt includes current debt plus non-current debt. ( ` cr) Particulars As at March 31, 2020 As at March 31, 2019 Total debt 108.47 54.75 Total equity 3,154.90 2,705.71 Debt-equity ratio 0.03 0.02 Note 29.10 Offsetting financial assets and liabilities The Group has not offset any financial asset and financial liability. The Group offsets a financial asset and a financial liability when it currently has a legal enforceable right to set off the recognised amounts and the Group intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. a) Master netting arrangements – not currently enforceable Agreementswith derivative counterparties are based on an ISDAMaster Agreement. Under the terms of these arrangements, only where certain credit events occur (such as default), the net position owing | receivable to a single counterparty in the same currency will be taken as owing and all the relevant arrangements terminated. As the Group does not presently have a legally enforceable right of set-off, these amounts have not been offset in the Consolidated Balance Sheet.