Mar 31, 2015
1.1 Basis of preparation of Financial Statements:
a. The 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 and Housing Finance Companies, (NHB) Directions, 2010. Accounting Standards (AS) referred to in the notes are as issued by the Institute of Chartered Accountants of India.
b. Accounting policies not specifically referred to otherwise are consistent with the generally accepted accounting principles followed by the Company.
c. The preparation of financial statements requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.
1.2 Interest on Housing Loan :
Repayment of housing loans is by way of Equated Monthly Instalments (EMI) comprising principal and interest. Interest is calculated each year on the outstanding balance at the beginning of the Company's financial year or on monthly reducing balance in terms of financing scheme opted by the borrower. EMI commences once the entire loan is disbursed. Pending commencement of EMI, pre-EMI monthly interest is payable.
1.3 Interest & other related Financial Charges:
Interest and other related financial charges are recognized as an expense for the period for which they are incurred as specified in Accounting Standard (AS 16) on "Borrowing Costs".
1.4. Revenue Recognition:
a. Interest on performing assets is recognized on accrual basis and on non-performing assets on realisation basis as per the guidelines prescribed by the National Housing Bank.
b. Income from other services is recognised on accrual basis.
1.5. Provision for Contingencies:
Provision for Contingencies has been made on non-performing housing loans and other assets as per the Prudential Norms prescribed by the National Housing Bank. Company has also made provision on standard assets as prescribed by the directions of National Housing Bank.
1.6. Fixed Assets:
Fixed Assets are stated at cost inclusive of expenses incidental thereto. All cost, including financing cost till the asset is put to use are capitalised. Depreciation on fixed assets is provided on written down value method at the rates calculated as prescribed under Schedule II to the Companies Act, 2013.
1.7. Special Reserve:
The Company creates Special Reserve every year out of its profits in terms of Section 29C of the National Housing Bank Act, 1987which includes the transfer of Reserve amount as per Section 36(1) (viii) of the Income Tax Act, 1961.
1.8 Prepaid Expenses:
Financial Expenses incurred during the year which provides benefit in several accounting years has been treated as revenue expense only for the period relating to the current year and balance is treated as prepaid expense to be adjusted on pro-rata time basis in the future accounting years.
1.9. Income Tax:
Income Tax provision based on the present tax laws in respect of taxable income for the year and the deferred tax is treated in the accounts based on the Accounting Standard (AS 22) on "Accounting for Taxes on Income". The Deferred Tax assets and liabilities for the year, arising out of timing difference, are reflected in the Profit and Loss account. The cumulative effect thereof is shown in the Balance Sheet. Deferred Tax assets, if any, are recognised only if there is a reasonable certainty that the assets will be realized in future.
1.10 Housing and Other Loans:
Housing Loans include outstanding amount of Housing Loan disbursed directly or indirectly to individual and other borrowers in accordance with directions of National Housing Bank (NHB). EMI and instalments due from borrowers and which are not overdue against the housing loans are shown under current assets head.
1.11 Earnings Per Share:
Basic and diluted earnings per share are determined by dividing the net profit / (loss) after income tax by the weighted number of ordinary shares outstanding during the financial year.