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Accounting Policies of Artefact Projects Ltd. Company

Mar 31, 2015

1.01 BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP), including the Accounting Standards notified under the relevant provisions of the Companies Act, 2013 as adopted consistently by the Company. The financial statements have been prepared on a going concern basis under the historical cost convention.

1.02 USE OF ESTIMATES

The preparation of financial statements in conformity with Indian GAAP requires judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

1.03 REVENUE RECOGNITION

Income from Mining Contracts, Consultancy & Infrastruture project services and Engineering Procurement Construction Contracts are recognised in accordance with the Contract/Agreement entered into. Revenues are recognised when it is earned and no significant uncertainty exists as to its ultimate collection and includes, service tax, wherever applicable. Interest income is recognised on a time proportion basis. Dividend is considered when the right to receive is established.

1.04 FIXED ASSETS - TANGIBLE ASSETS

Tangible Assets are stated at cost net of Central Value Added Tax and Value Added Tax Credits, less accumulated depreciation and impairment loss, if any. The cost of Tangible Assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use.

1.05 INTANGIBLE ASSETS

Intangible Assets are stated at cost less accumulated amortisation. Softwares which is not an integral part of the related hardware is classified as an Intangible asset and is amortised over the useful life of three years on Straight Line Basis.

1.06 DEPRECIATION

a) Depreciation on fixed assets is provided to the extent of depreciable amount on Straight Line Method over the useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

b) Additions, which form integral part of the fixed assets, are depreciated during the residual useful life of the asset.

c) In respect of fixed assets whose actual cost does not exceed Rs. 5000, depreciation is provided at 100% in the year of addition.

1.07 IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

1.08 INVESTMENTS

Long-term investments are carried at cost. Current Investments are carried at the lower of costs and quoted/ fair value computed script wise. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

1.09 BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets (Net of income earned and deployment of funds) are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and Loss.

1.10 EMPLOYEE'S BENEFITS

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered.

(ii) Post employment and other long term employee benefits are recognized as an expense on the Statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognized at the present value of the amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

1.11 FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. Non-Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

1.12 ACCOUNTING FOR JOINT VENTURE OPERATIONS

The financial statements reflect the share of the Company's assets and liabilities as well as income and expenditure of Joint Venture Operations which are accounted for according to the participating interest of the Company as per the various Joint Venture Agreements on a line by line basis along with similar items in the Company's financial statements.

1.13 DERIVATIVE INSTRUMENTS

In respect of derivative contracts, premium paid gains / losses on settlement and provision for losses, if any; are recognised in the Statement of Profit and Loss.

1.14 PROVISION FOR CURRENT AND DEFFERED TAX

Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable / virtual certainty that the assets will be realised against future taxable profits.

1.15 PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the financial statements. Contingent Assets are neither recognised nor disclosed in the financial statements.

1.16 SHARE ISSUE EXPENSES

Share issue expenses are adjusted against the Securities Premium Account.


Mar 31, 2014

1.01 BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention, in accordance with the generally accepted accounting principles, accounting standards issued by the Institute of Chartered Accountants Of India and the provisions of the Companies Act, 1956

1.02 USE OF ESTIMATES

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

1.03 REVENUE RECOGNITION

Income from Consultancy and Infrastructure project services are recognised in accordance with the Contract/Agreement entered into. Revenues are recognised when it is earned and no significant uncertainty exists as to its ultimate collection and includes, service tax, wherever applicable. Interest income is recognised on a time proportion basis. Dividend is considered when the right to receive is established.

1.04 FIXED ASSETS

Fixed Assets are stated at cost less accumulated depreciation, net of Central Value Added Tax. All costs including financing cost till the assets ready to use are capitalised.

1.05 INTANGIBLE ASSETS

Intangible Assets are stated at cost less accumulated amortisation. Softwares are amortised over a period of three years.

1.06 DEPRECIATION

Depreciation on fixed assets has been provided on Straight Line Method at the rates and in the manner specified in Schedule XIV of the Companies Act 1956. Additions, which form integral part of the fixed assets, are depreciated during the residual useful life of the asset. In respect of fixed assets whose actual cost does not exceed Rs. 5000, depreciation is provided at 100% in the year of addition.The leasehold improvements has been depreciated over the lease period.

1.07 IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

1.08 INVESTMENTS

Long-term investments are carried at cost. Current Investments are carried at the lower of costs and quoted/ fair value computed script wise. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

1.09 BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets (Net of income earned and deployment of funds) are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and Loss.

1.10 EMPLOYEE''S BENEFITS

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered.

(ii) Post employment and other long term employee benefits are recognized as an expense on the Statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognized at the present value of the amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

1.11 FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. Non-Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

1.12 ACCOUNTING FOR JOINT VENTURE OPERATIONS

The financial statements reflect the share of the Company''s assets and liabilities as well as income and expenditure of Joint Venture Operations which are accounted for according to the participating interest of the Company as per the various Joint Venture Agreements on a line by line basis along with similar items in the Company''s financial statements.

1.13 DERIVATIVE INSTRUMENTS

In respect of derivative contracts, premium paid gains / losses on settlement and provision for losses, if any; are recognised in the Statement of Profit and Loss.

1.14 PROVISION FOR CURRENT AND DEFFERED TAX

Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that asset will be realized in future.

1.15 PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

1.16 SHARE ISSUE EXPENSES

Share issue expenses are adjusted against the Securities Premium Account.


Mar 31, 2013

1.01 BASISOF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention, in accordance with the generally accepted accounting principles, accounting standards issued by the institute of Chartered Accountants Of India and the provisions of the Companies Act, 1956

1.02 USE OF ESTIMATES

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the dale of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

1.03 REVENUE RECOGNITION

Income from Consultancy and Infrastructure project services are recognised in accordance with the Contract/Agreement entered into. Revenues are recognised when it is earned and no significant uncertainty exists as to its ultimate collection and includes, service tax, wherever applicable. Interest income is recognised on a time proportion basis. Dividend is considered when the right to receive is established.

1.04 FIXED ASSETS

Fixed Assets are stated at cost less accumulated depreciation, net of Central Value Added Tax. All costs including financing cost till the assets ready to use are capitalised.

The leasehold improvements has been depreciated over the lease period.

1.05 INTANGIBLE ASSETS

Intangible Assets are stated at cost less accumulated amortisation. Softwares are amortised over a period of three years.

1.06 DEPRECIATION

Depreciation on fixed assets has been provided on Straight Line Method at the rates and in the manner specified in Schedule XIV of the Companies Act 1956. Additions, which form integral part of the fixed assets, are depreciated during the residual useful life of the asset. In respect of fixed assets whose actual cost does not exceed Rs. 5000, depreciation is provided at 100% in the year of addition.

1.07 IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

1.08 INVESTMENTS

Long-term investments are carried at cost. Current Investments are carried at the lower of costs and quoted/ fair value computed script wise. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

1.09 BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or constmction of qualifying assets (Net of income earned and deployment of funds) are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and Loss.

1.10 EMPLOYEE''S BENEFITS

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered. (ii) Post employment and other long term employee benefits are recognized as an expense on the Statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognized at the present value of the amount payable detennined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

1.11 FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. Non-Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

1.12 ACCOUNTING FOR JOINT VENTURE OPERATIONS

The financial statements reflect the share of the Company''s assets and liabilities as well as income and expenditure of Joint Venture Operations which are accounted for according to the participating interest of the Company as per the various Joint Venture Agreements on a line by line basis along with similar items in the Company''s financial statements,

1.13 DERIVATIVE INSTRUMENTS

In respect of derivative contracts, premium paid gains / losses on settlement and provision for losses, if any; are recognised in the Statement of Profit and Loss.

1.14 PROVISION FORCURRENT AND DEFFERED TAX

Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The defeircd tax asset is recognized and carried forward only to the extent that there is virtual certainty that asset will be realized in future.

1.15 PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

1.16 SHARE ISSUE EXPENSES

Share issue expenses are adjusted against the Securities Premium Account.


Mar 31, 2012

1.01 BASIS OF PREPARATION OF FINANCIAL STATEMENTS The financial statements have been prepared under the historical cost convention, in accordance with the generally accepted accounting principles, accounting standards issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956

1.02 USE OF ESTIMATES The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

1.03 REVENUE RECOGNITION Income from Consultancy and Infrastructure project services are recognised in accordance with the Contract/Agreement entered into. Revenues are recognised when it is earned and no significant uncertainty exists as to its ultimate collection and includes, service tax, wherever applicable. Interest income is recognised on a time proportion basis. Dividend is considered when the right to receive is established.

1.04 FIXED ASSETS Fixed Assets are stated at cost less accumulated depreciation, net of Central Value Added Tax. All costs including financing cost till the assets ready to use are capitalised.

1.05 INTANGIBLE ASSETS "Intangible Assets are stated at cost less accumulated amortisation. Softwares are amortised over a period of three years."

1.06 DEPRECIATION Depreciation on fixed assets has been provided on Straight Line Method at the rates and in the manner specified in Schedule XIV of the Companies Act 1956. Additions, which form integral part of the fixed assets, are depreciated during the residual useful life of the asset. In respect of

fixed assets whose actual cost does not exceed Rs. 5000, depreciation is provided at 100% in the year of addition.

1.07 IMPAIRMENT OF ASSETS An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

1.08 INVESTMENTS

Long-term investments are carried at cost. Current Investments are carried at the lower of costs and quoted/ fair value computed script wise. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

1.09 BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets (Net of income earned and deployment of funds) are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and Loss.

1.10 EMPLOYEE’S BENEFITS

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered.

(ii) Post employment and other long term employee benefits are recognized as an expense on the Statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognized at the present value of the amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

1.11 FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. Non-Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

1.12 ACCOUNTING FOR JOINT VENTURE OPERATIONS

The financial statements reflect the share of the Company’s assets and liabilities as well as income and expenditure of Joint Venture Operations which are accounted for according to the participating interest of the Company as per the various Joint Venture Agreements on a line by line basis along with similar items in the Company’s financial statements.

1.13 DERIVATIVE INSTRUMENTS

In respect of derivative contracts, premium paid gains / losses on settlement and provision for losses, if any; are recognised in the Statement of Profit and Loss.

1.14 PROVISION FOR CURRENT AND DEFFERED TAX

Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that asset will be realized in future.

1.15 PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

1.16 SHARE ISSUE EXPENSES

Share issue expenses are adjusted against the Securities Premium Account.

2.03 Rights to Equity Shareholders

The Company has only one class of equity share having face value of Rs. 10 per share. Each shareholder is eligible for one vote per share held

In the event of liquidation of the company , the equity shareholders will be entitled to receive any of remaining assets of the company after distributiion of all preferential amounts . The distribution will be in proportion to the number of equity shares held by the shareholder.

2.04 Reserved Shares :

The Convertible Share Warrants holders have the option to convert their Share Warrants into Nil Equity Share (Previous Year 10,22,400) of Rs. 10 each at the Terms and Condition referred in Note No. 4.

NOTE 4

MONEY RECEIVED AGAINST SHARE WARRANTS

As approved by the Shareholders in the Extra- Ordinary General Meeting held on February 23, 2010, the Company had alloted 1,022,400 Convertible Warrants on preferential basis @ Rs. 101 each to be converted into one fully paid-up equity share of the Company of Rs. 10 each at a premium of Rs. 91 per equity share at any time prior to 18 months from the date of allotment of warrants i.e April 27, 2010. During the year the warrants holders have exercise option in respect of 547,400 warrants and 547,400 Equity Shares are allotted. In respect of 475,000 warrants, warrant holders did not exercise their option, accordingly Rs.11,993,750 being the amount received against these Convertible Share Warrants has been forfeited by the Company and credited to Capital Reserve.

5.01 Term Loan from a Bank referred to above and Rs.14,834,402 included in current maturity of long term debts in Note No.9 is Secured against Mortgage of Building and Hypothecation of other Fixed Assets, Equipments, Hardwares and Softwares. The loan is repayable in 42 equal monthly installments (including interest) of Rs. 2,373,415 as per repayment schedule, ending on September 6, 2015 and carry a prevailing interest rate @ 16% p.a.

5.02 Guaranteed by Directors or others :

The above term loan from a bank is guaranteed by some of the Directors in their personal capacity and also covered by a Corporate Guarantee of a Company i.e. Vidharbha Holding Limited.

5.03 Vehicle Loan referred to above and Rs.315,975 included in current maturity of long term debts in Note No.9 is secured by the hypothecation of the specific vehicle financed. The loan is repayable in 43 monthly equal instalments (including interest) of Rs. 34,570 as per repayment schedule.

7.01 Working Capital Loans form Banks

(i) aggregating to Rs.87,888,880 (Previous Year Rs. 81,245,319) referred to above are secured by the hypothecation of whole of the movable properties Including Book Debts and Assets both present and future, and are further secured collaterally by mortgage of immovable properties of the Company, guaranteed by some of the directors in their personal capacity and also covered by a Corporate Guarantee of a Company i.e. Vidharbha Holding Ltd.

(ii) aggregating to Rs.20,252,589 (Previous Year Rs. Nil) referred to above are secured by the Pledge of Fixed Deposit with Bank (Refer Note No. 15.01).

EMPLOYEES BENEFIT EXPENSES

20.01 Salaries, Wages and Allowance includes Remuneration to Executive Directors of Rs. Nil (Previous Year Rs. 2,263,505) paid in excess of the amount eligible under schedule XIII of the Companies Act, 1956. The Company has already applied for the approval to the Central Government.


Mar 31, 2010

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention, in accordance with the generally accepted accounting principles, accounting standards issued by the Institute of Chartered Accountants Of India and the provisions of the Companies Act, 1956

2. USE OF ESTIMATES

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

3. REVENUE RECOGNITION

Income from Consultancy and Infrastructure project services are recognised in accordance with the Contract/Agreement entered into. Revenues are recognised when it is earned and no significant uncertainty exists as to its ultimate collection and includes, service tax, wherever applicable.

4. FIXED ASSETS

Fixed Assets are stated at cost less accumulated depreciation, net of Central Value Added Tax. All costs including financing cost till commencement of commercial production are capitalised.

5. INTANGIBLE ASSETS

Intangible Assets are stated at cost less accumulated amortisation. Softwares are amortised over a period of three years.

6. DEPRECIATION

Depreciation on fixed assets has been provided on Straight Line Method at the rates and in the manner specified in Schedule XIV of the Companies Act 1956. Additions, which form integral part of the fixed assets, are depreciated during the residual useful life of the asset. In respect of fixed assets whose actual cost does not exceed ?. 5000, depreciation is provided at 100% in the year of addition.

7. INVESTMENTS

Long-term investments are carried at cost. Current Investments are carried at the lower of costs and quoted/fair value computed script wise. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

8. BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

9. EMPLOYEES BENEFITS

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

(ii) Post employment and other long term employee benefits are recognized as an expense in the profit and loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the profit and loss account.

10. FOREIGN CURRENCYTRANSACTION

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. Non-Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss account.

11. TAXATION

Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that asset will be realized in future

12. ACCOUNTING FOR JOINT VENTURE OPERATIONS

The financial statements reflect the share of the Companys assets and liabilities as well as income and expenditure of Joint Venture Operations which are accounted for according to the participating interest of the Company as per the various Joint Venture Agreements on a line by line basis along with similar items in the Companys financial statements.

13. DERIVATIVE INSTRUMENTS

In respect of derivative contracts, premium paid gains / losses on settlement and provision for losses, if any; are recognised in the Profit and Loss Account.

14. IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

15. PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

Notes:

1 Bracket indicates cash outflow.

2 The above cash flow statement has been prepared under the "Indirect Method" as set out in the Accounting Standard 3 - "Cash Flow Statement" as notified by Companies (Accounting Standard) Rules, 2006.

3 Cash And Cash Equivalents At The End Of The Year includes deposits with banks aggreagating to Rs. 98,32,000/- which are pledged against bank guaranteesw and overdraft.