PRIVI SPECIALITY CHEMICALS LIMITED Annual Report 2020-21

182 PRIVI SPECIALITY CHEMICALS LIMITED (Formerly known as Fairchem Speciality Limited) Impairment of Trade receivables At March 31, 2021, the ageing of trade and other receivables that were not impaired was as follows. Particulars Carrying amount March 31, 2021 March 31, 2020 (Restated) Neither past due nor impaired 19,076.98 17,185.14 Past due 0-90 days 3,910.20 4,446.67 Past due 90-180 days 547.81 701.29 Past due 180-270 days 294.95 40.34 Past due 270-360 days 8.34 – More than 360 days 65.57 516.62 23,903.85 22,890.06 Movement in Loss allowance measured at amount equal to life time expected credit losses for trade receivables. Particulars Amount Opening balance as at April 01, 2019 (Restated) 10.86 Impairment loss recognised 15.58 Amounts written off – Balance as at March 31, 2020 (Restated) 26.44 Impairment loss recognised – Amounts written off – Balance as at March 31, 2021 26.44 The Group uses an allowance matrix to measure the expected credit loss of trade receivables. Based on the industry practices and the business environment in which the entity operates, Management considers that the trade receivables are in default (credit impaired) if the payments are more than 365 days past due. Management believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk and the current provision for the bad debts represents the impacted credit loss it foresees in its receivables. Financial assets other than trade receivables are not impaired and further, there are no amounts that are past due. Management believes that the amounts are collectible in full, based on historical payment behaviour. b) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group maintains the level of its cash and cash equivalents at an amount in excess of expected cash outflow on financial liabilities. The Group also monitors the level of expected cash inflows on trade and other receivables together with expected cash inflows on trade and other payables. 34 Financial risk management (continued) NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2021 (Currency: Indian Rupees in lakhs)