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Background
Atul Ltd (the Company) is a public company limited by shares, incorporated and domiciled in India. Its registered office is located at
Atul House, G I Patel Marg, Ahmedabad 380 014, Gujarat, India and the principal place of business is located at Atul, Gujarat, India.
The Company and its subsidiary companies are referred to as the Group here under. The Group is serving the needs of varied industries
such as Adhesives, Agriculture, Animal Feed, Automobile, Composites, Construction, Cosmetic, Defence, Dyestuff, Electrical and
Electronics, Flavour, Food, Footwear, Fragrance, Glass, Home Care, Horticulture, Hospitality, Paint and Coatings, Paper, Personal Care,
Pharmaceutical, Plastic, Polymer, Rubber, Soap and Detergent, Sport and Leisure, Textile, Tyre and Wind Energy across the world.
Note 1 Significant Accounting Policies
This Note provides a list of the significant Accounting Policies adopted by the Group in preparation of these Consolidated
Financial Statements. These policies have been consistently applied to all the years presented, unless otherwise stated. The
Consolidated Financial Statements are for the Group consisting of the Company and its subsidiary companies.
a) Basis of preparation:
i)
Compliance with Ind AS:
The Consolidated Financial Statements comply in all material respects with Indian Accounting Standards (Ind AS)
notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules,
2015] and other relevant provisions of the Act as amended.
ii) Historical cost convention:
The Consolidated Financial Statements have been prepared on a historical cost basis except for the following:
a) Certain financial assets and liabilities (including derivative instruments): measured at fair value
b) Defined benefit plans: plan assets measured at fair value
c) Biological assets: measured at fair value less cost to sell
b) Principles of Consolidation and equity accounting:
i) Subsidiary companies
Subsidiary companies are all entities over which the Group has control. The Group controls an entity when the Group
is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power to direct the relevant activities of the entity. Subsidiary companies are fully consolidated
from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group.
The Group combines the Financial Statements of the parent and its subsidiary companies line by line adding together
like items of assets, liabilities, equity, income and expenses. Intercompany transactions, balances and unrealised gains
on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the transferred asset. Accounting Policies of subsidiary companies have been
changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiary companies are shown separately in the Consolidated
Statement of Profit and Loss, Consolidated Statement of changes in equity and Consolidated Balance Sheet respectively.
ii) Associate companies
Associate companies are all entities over which the Group has significant influence, but not control or joint control.
This is generally the case where the Group holds between 20% and 50% of the voting rights. Investments in associate
companies are accounted for using the equity method of accounting {see (iv) below}.
iii) Joint arrangements
Under Ind AS 111 ’Joint Arrangements‘, investments in joint arrangements are classified as either joint operations or
joint ventures. The classification depends on the contractual rights and obligations of each investor, rather than the
legal structure of the ’Joint Arrangement‘. The Group has interest only in one joint venture company.
Joint venture company
Interest in joint venture company is accounted for using the equity method {see (iv) below}.
Joint operation
The Group recognises its direct right to the assets, liabilities, revenues and expenses of joint operation and its share of
any jointly held or incurred assets, liabilities, revenues and expenses. Theses have been incorporated in the Consolidated
Financial Statement under the appropriate headings. Details of the joint operation are set out in Note 29.14.
Notes
to the Consolidated Financial Statements