Heritage Foods Limited | 30th Annual Report 2021-22

30 th Annual Report 2021-22 Heritage Foods Limited 172 Categories of financial instruments Particulars As at 31 March 2022 As at 31 March 2021 FVTPL FVTOCI Amortised cost FVTPL FVTOCI Amortised cost Financial assets Quoted equity shares - 0.20 - - 0.13 - Unquoted equity shares - 2.60 - - 2.60 - Investment in government securities - - 0.16 - - 0.16 Trade receivables - - 179.76 - - 145.33 Cash and cash equivalents - - 324.76 - - 196.64 Other bank balances - - 24.99 - - 17.29 Loans - - 0.91 - - 8.90 Other financial assets - - 96.94 - - 83.02 - 2.80 627.52 - 2.73 451.34 Particulars As at 31 March 2022 As at 31 March 2021 FVTPL FVTOCI Amortised cost FVTPL FVTOCI Amortised cost Financial liabilities Deferred payment liabilities - - 37.47 - - 53.47 Borrowings - - - - - 470.25 Lease liabilities - - 75.36 - - 44.87 Trade payables - - 482.04 - - 327.77 Other financial liabilities - - 1,026.68 - - 1,182.33 - - 1,621.55 - - 2,078.69 The fair value of the financial assets and financial liabilities are included at an amount at which the instruments could be exchanged in a current transaction between the willing parties, other than in a forced or liquidation sale. 40. Financial risk management objectives and policies Financial Risk Management Framework The Company’s Board of Directors has an overall responsibility for the establishment and oversight of the Company’s risk management framework. The Board of Directors has established Risk Management Committee, which is responsible for developing and monitoring the Company’s risk management policies. The Committee reports regularly to the Board of Directors on its activities. The Company’s principal financial liabilities, comprises of borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include investments in equity shares, loans, trade and other receivables, and cash and cash equivalents that the Company derives directly from its operations. The Company is exposed primarily to Credit risk, Liquidity risk and Market risk (fluctuations in interest rates, foreign currency rates, and prices of equity instruments), which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company. A. Credit risk Credit risk is the risk that the counterparty shall not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of the creditworthiness as well as concentration of risks. Credit risk arises primarily from financial assets such as trade receivables, investment in equity shares, balances with banks, loans and other receivables. Credit risk is controlled by analyzing credit limits and creditworthiness of the customers on a continuous basis to whom credits have been granted after obtaining necessary approvals. Financial instruments that are subject to concentration of credit risk principally consist of trade receivables, investments, cash and cash equivalents, bank deposits and other financial assets. None of the financial instruments of the Company result in material concentration of credit risk. Summary of the significant accounting policies and other explanatory information (All amounts in ` millions, except share data and where otherwise stated)