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Accounting Policies of AGI Infra Ltd. Company

Mar 31, 2016

A. Basis of Preparation of Financial Statements

a. Financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 2013.

b. The Company follows the mercantile system of accounting on a going concern basis.

B. Use of Estimates

These preparation of financial statement is in conformity with GAAP requires management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosure relating to contingent assets and liabilities as at the date of financial statements are reported amounts of incomes and expenses during the period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the management become aware of changes in circumstances surrounding the estimates.

C. Fixed Assets, including Intangible Assets and Capital Work in Progress

a) Fixed assets are stated at cost of acquisition or construction (net of Cenvat Credits). All cost relating to the acquisition and installation of fixed assets are capitalized and include borrowing costs directly attributable to construction or acquisition of fixed assets, up to the date of asset is put to use and adjustment arising out of exchange rate variation relating to liabilities attributable to those fixed assets. They are stated at historical cost less depreciation.

b) Capital Work-In-Progress comprises of the cost of fixed assets that are not yet ready for their intended use at the reporting date.

D. Depreciation and Amortization

Depreciation has been provided based on life assigned to each asset in accordance with schedule II of the Companies Act 2013. Share Issue expenses has been written off in five years.

E. Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

a) Revenue from job work is recognized on the basis of % completed service contract.

b) Sales are accounted for on handed over of possession to the customers and are exclusive of the Service Tax, sales return rebate & discount, rate difference but inclusive of the sales tax, if any.

c) Dividend income and insurance claim has been accounted on cash basis.

d) Commission income, profit on sale of Assets, Investment, Export incentives, Int. on FDR are accounted on accrual basis.

e) Custom duty refund not recovered from the buyers and it will be recognized in the books of accounts as and when recovered from the custom department

F. Inventories

a) Inventories of Raw materials are valued at cost, determined on FIFO basis. Cost of Raw Materials Stocks is determined so as to exclude from cost, taxes and duties, which are subsequently Recoverable from taxing authorities.

b) Stock of Work-in-progress valued at estimated cost.

c) Stock of finished goods is valued at cost or market price whichever is less.

G. Cash Flow Statement

Cash flows are reported using the indirect method, where by profit/(loss) before extraordinary items and tax is adjusted for the effects of transactions of non cash nature and deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregated based on the available information.

H. Foreign Currency Transactions

Sometimes the payments are received from the NRI customers in foreign exchange and the amount received after conversion is credited to their accounts. Question of exchange difference does not arise. In case of foreign exchange outgo actual payments made through banks are debited to the parties.

I. Investment

Investments are classified into long-term investments and short-term investments. Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments. Long Term Investments & Short Term Investments are carried at cost. No provisions for diminution has been made as in the opinion of the management the diminution are temporary in nature.

J. Impairment of Assets

The carrying amount of assets is reviewed at each Balance Sheet date to determine if there is any indication of impairment thereof based on external/ internal factors. An impairment loss in accordance with Accounting Standard-28 “Impairment of Assets “ is recognized wherever the carrying amount of an assets exceeds its recoverable amount, which represent the greater of the net selling price of assets and their value in use. An impairment loss recognized in prior accounting period is reversed if there has been a change in estimate of recoverable amount.

K. Retirement and other Employee Benefits

a) Gratuity - Liabilities in respect of Gratuity is being provided in respect of employees who have completed 5 years of service as on date of balance sheet.

b) Provident Fund and Leave Encashment - A liability in respect of Provident Fund & Leave Encashment is provided in the accounts on accrual basis for the period.

L. Segment Reporting

a) The company is dealing in construction & development of Real Estate Business. There is no other segment in which company is engaged.

N. Borrowing cost

Borrowing Cost directly attributable to the acquisition or construction of qualifying assets is capitalized. Other borrowing cost is recognized as expenses in the period in which they are incurred.

O. Taxation

a) Current tax is determined as the amount of tax payable in respect of taxable income for the year.

b) Deferred tax is recognized, on timing differences, being the Difference between taxable incomes and accounting income that originates in one period and is capable of reversal in one or more subsequent periods.

c) Minimum Alternate Tax (MAT) Credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during specified period. The year in which the MAT credit becomes eligible, it is to be recognized as an asset. In accordance with recommendation contained in the guidance note issued by ICAI, said asset is created by way of credit/reversal of provisions to Profit and Loss A/c and shown as MAT Credit Entitlements in Loans and Advances. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that company will pay normal Income Tax during the specified period.

P. Provisions, Contingent Liabilities and Contingent Assets:

a) The company has submitted performance guarantees aggregating Rs. 93.04 lacs in favour Jalandhar Development Authority in respect of licenses issued by JDA for approving group housing projects.

b) There are certain litigations pending against the company on account of which a liability of Rs.1.90 lacs may arise in future.

Q. Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.

R. There are no Auditor''s Qualifications in the Financial Statements of the Company.


Mar 31, 2015

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