Page 160 - Kolte Patil AR 2019-20

Notes forming part of the standalone financial statements

NOTE 35 - EMPLOYEE BENEFITS (Contd.)
xi. Sensitivity analysis: A quantitative sensitivity analysis for significant assumption is as shown below:

(H in Lakhs)
Effect on Defined Benefit Obligation on account of 1% change in the assumed rates:
DBO Rates Discount Rate Salary Escalation Rate Withdrawal Rate
Types
Year 1% Increase 1% Decrease 1% Increase 1% Decrease 1% Increase 1% Decrease
March 31, 2020 754 808 796 764 778 782
March 31, 2019 702 750 740 711 722 728
The sensitivity results above determine their individual impact on plan’s end of year defined benefit obligation. In reality, the plan is subject
to multiple external experience items which may move the defined benefit obligation in similar or opposite directions, while the plan’s
sensitivity to such changes can vary over time.
xii. Employee benefit plans

The plans typically expose the company to the actuarial risks such as: investments risk, interest risks, longevity risk and salary risk
The present value of the defined benefit plan liability (denominated in Indian Rupee) is calculated using a
Investment risk discount rate which is determined by reference to market yields at the end of the reporting period on
government bonds.
A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase
Interest risk
in the return on the plan’s debt investments.
The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of
Longevity risk plan participants both during and after their employment. An increase in the life expectancy of the plan participants
will increase the plan’s liability.
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants.
Salary risk
As such, an increase in the salary of the plan participants will increase the plan’s liability.
No other post-retirement benefits are provided to these employees.

In respect of the plan, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were
carried out as at March 31, 2020 by Ranadey Professional Services, Fellow of the Institute of Actuaries of India. The present value of the
defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit
method.

NOTE 36 - SEGMENT INFORMATION
Information reported to the chief operating decision maker (CODM) for the purposes of resource allocation and assessment of segment
performance focuses on the types of goods and services delivered or provided. The Company is engaged in development of real estate
property, operating in India, which in the context of Indian Accounting Standard 108 ‘Segment Information’ represents single reportable
business segment.

NOTE 37 - LEASES
Where the Company is Lessee:
The Company has entered into operating lease arrangements for certain facilities and office premises having term or remaining life as at April
1, 2019 for less than one year. Expenses for operating leases included in the Statement of Profit and Loss for the year is H125 Lakhs.
Where the Company is Lessor:
The Company has entered into operating lease arrangements for certain surplus facilities. The leases are cancellable.
Rental income from operating leases included in the statement of Profit and Loss for the year is H122 Lakhs [Previous Year - H114 Lakhs].

158 | Kolte-Patil Developers Limited