Accounting Policies of Force Motors Ltd.

Company

(a) Statement of Compliance

The Company's financial statements conform with Indian Accounting Standards (Ind
AS) notified under Section 133 of the Companies Act, 2013 (the Act) [the Companies
(Indian Accounting Standards) Rules, 2015] and other applicable provisions of the
Act in all important respects.

(b) Basis of preparation

Except for some financial instruments and defined benefit plans, which are
assessed at fair value, the financial statements have been compiled on a historical
cost basis.

(c) Revenue Recognition

(i) sales: Revenue is calculated using the fair value of the consideration received or
receivable. The Company recognises revenue when it has passed the significant
risks and rewards connected with the goods to the buyer, the amount of revenue
can be reliably assessed, and future economic advantages are likely to come to the
Company.

(ii) Other Incomes: Other income is recognised when the economic advantage is
likely to accrue to the firm and the amount of income can be quantified accurately.

(d) Inventories: Inventory is valued at the lower of its cost or net realisable value.
The price of raw materials, retailers, and consumables is calculated using a moving
weighted average. Inventory include the costs of acquisition, conversion, and other
expenses spent in moving inventories to their current location and condition. The
cost of raw materials and purchased components is less than the net realisable
value. The weighted average approach is used to calculate the cost. Finished Goods
and work-in-progress are carried at the lowest of cost or net realisable value. Other
than outdated and slow moving commodities, stores, spares, and tools are
transported at cost. Obsolete and slow-moving objects are appraised at the lower of
cost or projected net realisable value.

(e) Property, Plant, and Equipment: Except for land, property, plant, and equipment
are carried at the historical cost of acquisition, construction, or production, as
applicable, minus accrued depreciation and amortisation. The expense of acquiring
freehold land is borne. Cost includes all expenditures directly linked to restoring the
asset to a workable condition in which it can operate as planned. Costs expended to
produce property, plant, and equipment, as well as intangibles, are deducted from
total expenditure in the Statement of Profit and Loss under the heading
Expenditure, included in aforementioned items, capitalised. (f) Intangible Assets
Acquired intangible assets are recorded at purchase cost, minus accrued
amortisation and any impairment losses. Internally developed intangible assets: The
Company's spending on the creation of researched know-how is recognised as an
intangible asset if and only if the future economic advantages due to the application
of such know-how are likely to flow to the Company and the expenses / expenditure
can be evaluated accurately.

(f) Property: Investment property is valued at the purchase price less cumulative
depreciation.

(g) Asset impairment: When events or changes in circumstances suggest that the
carrying amount may not be recovered, assets are evaluated for impairment.

(h) Amortization and depreciation

1- Depreciation on Property, Plant, and Equipment: Depreciation on Property, Plant,

and Equipment is given in Schedule-II to the Companies Act, 2013. - Leasehold land
is amortised over the lease term.

2- Intangible Assets: - Software and installation expenditures are written off over a
five-year period. - Acquired and domestically developed technical know-how is
amortised throughout the useful life of the assets, which is limited to ten years.

(i) Borrowing Fees: Borrowing costs spent for the purchase, building, or
manufacturing of a qualified asset are capitalised.

(j) Expenses for research and development: Revenue spending on R&D is written off
as an expense in the year in which it is incurred, while capital investment is grouped
with Assets under relevant categories and depreciation is supplied at the
corresponding rates.

(k) Leases

(i) Where the firm is the Lessee: - Operating leases are those in which the Lessor
effectively maintains virtually all of the risks and advantages of ownership of the
leased item. Operating lease payments are recorded as an expense on the
Statement of Profit and Loss. - Finance leases are capitalised at the start of the lease
at the fair value of the leased property.

(ii) Where the Company is the Lessor: Lease rents are recorded on the profit and
loss statement. Costs, including depreciation, are shown as an item on the
Statement of Profit and Loss.

(l) Taxation: Current tax is calculated as the amount of tax payable for the year on
taxable income. The current tax of the Company is determined using tax rates that
have been imposed or substantially enacted before the end of the reporting
quarter. On transitory disparities between the tax base of assets and liabilities and
their carrying amount in the financial statements, deferred tax is recorded.