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Shaping the future of software driven business
Consolidated Financials •
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Herald Technologies Inc. (HTI), based in the USA a wholly owned subsidiary of Persistent Systems Inc., is working on
implementation of platforms and related IT services for the healthcare industry.
2. Basis of preparation
The consolidated financial statements of the Group have been prepared on an accrual basis and under the historical cost
convention except for certain financial instruments, equity settled employee stock options and initial recognition of assets
acquired under business combinations which have been measured at fair value. Historical cost is generally based on the
fair value of the consideration given in exchange for goods and services. The accounting policies are consistently applied
by the Group during the year and are consistent with those used in previous year except where a newly issued accounting
standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy
hitherto in use.
Statement of compliance:
In accordance with the notification issued by the Ministry of Corporate Affairs, the Group has adopted Indian Accounting
Standards (referred to as “Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015.
3. Principles of consolidation
The consolidated financial statements of the Company and its subsidiaries (“the Group”) for the year ended March 31, 2019
are prepared in accordance with generally accepted accounting principles applicable in India, and the Indian Accounting
Standard 110 (Ind AS 110) on ‘Consolidated Financial Statements’, notified by Companies (Accounting Standards) Rules,
2015, (“Indian Accounting Standards”) by and to the extent possible in the same format as that adopted by the Company
for its separate financial statements.
The Company consolidates entities which it owns or controls. The consolidated financial statements comprise the financial
statements of the company, its subsidiaries as disclosed below. Control exists when the parent has power over the entity,
is exposed or has rights to variable returns from its involvement with the entity; and has the ability to affect those
returns by using its power over the entity. Power is demonstrated through existing rights that give the ability to direct
relevant activities, those which significantly affect the entity’s returns. Subsidiaries are consolidated from the date control
commences until the date control ceases.
The financial statements of the Company and its subsidiary companies have been combined on line by line basis by adding
together the book values of like items of assets and liabilities, income and expenses after eliminating intra group balances
and intra group transactions except where cost cannot be recovered. The unrealized profits or losses resulting from the
intra group transactions and balances have been eliminated.
The consolidated financial statements include the share of profit / loss of associate companies, which are accounted for
under the ‘Equity method’. The share of profit / loss of the associate company has been adjusted to the cost of investment
in the associate, as per the ‘Equity method’. An associate is an enterprise in which the investor has significant influence
and which is neither a subsidiary nor a joint venture.
The excess of the cost to the Company of its investment in a subsidiary and the Company’s portion of equity of subsidiary
on the date at which investment in the subsidiary is made, is described as goodwill and recognized separately as an asset
in the consolidated financial statements. The excess of the Company’s portion of equity of the acquired company over its
cost is treated as gain on bargain purchase in the financial statements. Goodwill arising on consolidation is not amortized.
It is tested for impairment on a periodic basis and written off if found impaired.
The consolidated financial statements are prepared using uniform accounting policies for like transactions and other
events in similar circumstances and necessary adjustments required for deviations, if any, are made in the consolidated
financial statements. The consolidated financial statements are presented in the same manner as the Company’s separate
financial statements.
The financial statements of the subsidiary companies used in the consolidation are drawn up to the same reporting date
as of the Company.
Notes forming part of consolidated financial statements (Contd.)