227 (` cr) Note 15 Other equity As at March 31, 2023 As at March 31, 2022 Summary of other equity balance a) General reserve 2.52 71.24 b) Retained earnings 4,152.67 3,747.18 c) Statutory reserve 0.54 0.18 d) Capital redemption reserve 0.15 0.07 e) Other reserves i) FVTOCI equity instruments 454.36 554.95 ii) Effective portion of cash flows hedges (0.68) 0.20 iii) Foreign currency translation reserve 32.29 25.53 4,641.85 4,399.35 Refer Consolidated Statement of changes in equity for detailed movement in other equity balance. Nature and purpose of other reserves a) General reserve General reserve represents amount appropriated out of retained earnings pursuant to the earlier provisions of Companies Act, 1956 and local laws of respective foreign subsidiary companies. b) Retained earnings Retained earnings are the profits that the Group has earned till date, less, any transfers to general reserve, any transfers from or to other comprehensive income, dividends or other distributions paid to shareholders. c) Statutory reserve Statutory reserve represents the reserve created pursuant to the Reserve Bank of India Act, 1934 (the RBI Act ). In terms of Section 45-IC of the RBI Act, a Non-Banking Finance Company is required to transfer an amount not less than 20 per cent of its net profit to a reserve fund before declaring any dividend. Appropriation from this reserve fund is permitted only for the purposes specified by RBI. d) Capital redemption reserve In accordance with Section 69 of the Companies Act, 2013, the Company creates capital redemption reserve equal to the nominal value of the shares bought back as an appropriation from general reserve. e) FVTOCI equity instruments The Group has elected to recognise changes in the fair value of certain investments in equity securities in other comprehensive income. These changes are accumulated within the FVTOCI equity instruments reserve within equity. The Group transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised. f) Cash flow hedge reserve The Group uses hedging instruments as part of its management of foreign currency risk associated with its highly probable forecast sale and inventory purchases and interest rate risk associated with variable interest rate borrowings. For hedging foreign currency risk, the Group uses foreign currency forward contracts, foreign currency option contracts and interest rate swaps. They are designated as cash flow hedges to the extent these hedges are effective, the change in fair value of the hedging instrument is recognised in the cash flow hedging reserve. Amounts recognised in the cash flow hedging reserve is reclassified to profit or loss when the hedged item affects profit or loss (for example, sales and interest payments). When the forecast transaction results in the recognition of a non-financial asset (for example, inventory), the amount recognised in the cash flow hedging reserve is adjusted against the carrying amount of the nonfinancial asset. g) Foreign currency translation reserve Exchange differences arising on translation of the Financial Statements of a foreign operation are recognised in other comprehensive income as described in accountingpolicy andaccumulated in a separate reservewithin equity. The cumulative amount is reclassified to the Consolidated Statement of Profit and Loss when the net investment is disposed-off.
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