MAHINDRA & MAHINDRA LTD. | Integrated Annual Report 2022-23

243 COMPANY OVERVIEW BOARD’S REPORT MANAGEMENT DISCUSSION AND ANALYSIS CORPORATE GOVERNANCE BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT STANDALONE ACCOUNTS CONSOLIDATED ACCOUNTS 1. General Information Mahindra & Mahindra Limited (‘the Company’) is a limited company incorporated in India. The addresses of its registered office and principal activities of the Company are disclosed in the introduction to the Annual Report. The Ordinary (Equity) shares of the Company are listed on the National Stock Exchange of India Limited (“NSE”) and BSE Limited (“BSE”) in India. The Global Depository Receipts (GDRs) of the Company are listed on the Luxembourg Stock Exchange and are also admitted for trading on International Order Book (IOB) of the London Stock Exchange. 2. Significant Accounting Policies: (a) Statement of compliance and basis of preparation and presentation These standalone or separate financial statements of the Company have been prepared in accordance with Indian Accounting Standards as per the Companies (Indian Accounting Standards) Rules, 2015 as amended and notified under Section 133 of the Companies Act, 2013 (the ‘Act’) and other relevant provisions of the Act. These standalone or separate financial statements were approved by the Company’s Board of Directors and authorised for issue on 26 th May, 2023. (b) Basis of measurement The financial statements have been prepared on the historical cost basis except for certain financial instruments which are measured at fair values. (c) Measurement of fair values A number of Company’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. The Company has established policies and procedures with respect to the measurement of fair values. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows: — Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities. — Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. — Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs). (d) Use of estimates and judgments The preparation of financial statements in conformity with Ind AS requires management to make judgments, estimates and assumptions, that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses at the date of these financial statements and the reported amounts of revenues and expenses for the years presented. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed at each balance sheet date. Revisions to accounting estimates are recognised in the period in which the estimate is revised and future periods affected. Key sources of estimation uncertainty at the date of financial statements, which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, is in respect of useful lives of property, plant and equipment, intangible assets, provision for product warranties, fair value of financial assets/liabilities and impairment of investments. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below: (i) Useful lives of property, plant and equipment and intangible assets The Company reviews the useful lives of property, plant and equipment and intangible assets at the end of each reporting period. This re- assessment may result in change in depreciation and amortisation expense in future periods. (ii) Provision for product warranties The Company recognises provision for warranties in respect of the products that it sells. Provisions are discounted, where necessary, to its present value based on the best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. (iii) Fair value of financial assets and liabilities and investments The Company measures certain financial assets and liabilities on fair value basis at each balance sheet date or at the time they are assessed for impairment. Fair value measurement that are based on significant unobservable inputs (Level 3) requires estimates of operating margin, discount rate, future growth rate, terminal values, etc. based on management’s best estimate about future developments. Notes forming part of the Financial Statements | for the period ended 31 st March, 2023