Mar 31, 2012
1. Corporate Information
Brandhouse Retails Limited (BHRL) is a Public Company domiciled in
India and incorporated under the provisions of the Companies Act, 1956.
Its shares are listed on two stock exchanges in India. The Company was
established as a pure play retail organization. As a company that
caters to the entire spectrum of the socio-economic stratum in the
Indian market, BHRL's retail expertise extends from mid-price to the
lifestyle and luxury segment.
Driven by a team of specialists with experience in Retail & Brand
building, BHRL's proficiency is focused to retailing of fashion wear -
Textiles, Apparels, Home Textiles and Fashion Accessories.
BHRL is amongst the leading Fashion Retailers in India. It currently
manages the retailing of the brands i.e. Reid & Taylor, Belmonte,
Carmichael House and dunhill through Exclusive Brand Outlets across
India.
2. Method of Accounting
The Financial statements have been prepared on accrual basis, except
wherever otherwise stated, under the historical cost convention, in
accordance with the accounting principles generally accepted in India
and comply with the Accounting Standards as referred to in the
Companies (Accounting Standards) Rules 2006 issued by the Central
Government in exercise of power conferred under sub-section (i)(a) of
Section 642 and the relevant provisions of the Companies Act, 1956.
3. Use of Estimates
The preparation of the financial statements in conformity with the
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of Assets
and Liabilities and disclosures of contingent liabilities on the date
of financial statements. Actual results could differ from those
estimates. Any revision to accounting estimates is recognized
prospectively in the current and future periods.
4. Fixed Assets
i) Tangible Assets are stated at the cost of acquisition (inclusive of
all incidental expenses incurred towards acquisition and installation
thereof) less accumulated depreciation thereon.
ii) Intangible assets are carried at cost less accumulated
depreciation/amortization.
iii) Impairment of assets:
If the carrying amount of fixed assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured at the higher of
the net selling price and the value in use determined by the present
value of estimated future cash flow. Impairment loss is charged to
Statement of Profit and Loss.
5. depreciation
i. The Company provides depreciation on Tangible assets on Straight
Line Method at the rates and in the manner prescribed in Schedule XIV
to the Companies Act, 1956. In respect of Leasehold Improvements &
Visuals, the Company amortises the entire value over their useful life
as estimated by the management or primary period of lease, including
any further renewal period thereof, whichever is lower.
ii. Depreciation on assets each costing less than Rs. 5000/- is provided
for at 100% of the cost as specified in Schedule XIV to the Companies
Act, 1956.
iii. In respect of Stores closed, the WDV of Furniture and Fixture is
depreciated @ 100% in the year, in which stores are closed down.
iv. Goodwill on demerger is amortised over Ten Years on Straight Line
Method (SLM) basis.
6. Borrowing Costs
Borrowing costs attributable to the acquisition/construction of a
qualifying asset are capitalised as part of the cost of such assets, up
to the period assets are ready for their intended use. Other borrowing
costs are recognised as an expense in the period in which they are
incurred.
7. Capital work in Progress
Projects under commissioning and other capital work-in-progress are
carried at cost, comprising direct cost and related incidental
expenses.
8. Revenue Recognition
i. Revenue is recognised on sale of products when no significant
uncertainty as to its determination or realization exists.
ii. Sales are shown net of returns and Value Added Tax.
iii. Purchases, consistently accounted for on the basis of actual
receipt of goods, are shown net of returns, turnover incentives and
other incidental charges and include freight charges.
iv. Interest Income is recognized on time proportion basis, taking
into account the amount outstanding and the rate applicable.
vi. The claims are accounted for an acceptance basis.
9. Retirement and other Employee benefits
The Company contributes towards Provident Fund and Superannuation fund
which are defined contribution schemes. Provision for Gratuity and
Leave encashment is made on the basis of Actuarial Valuations done by
Independent Actuaries on each Balance Sheet date, forming part of
defined benefit plans.
10. Accounting for Taxes on income
i. Current tax is determined as the amount of tax payable in respect
of taxable income for the year, based on the applicable tax rates and
tax laws.
ii. Deferred tax is recognised on timing differences, being the
difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent
periods and is measured using tax rates that have been enacted or
substantively enacted as on the Balance Sheet date. Where there is
unabsorbed depreciation or carry forward losses, deferred tax assets
are recognised only if there is virtual certainty of realisation of
such assets. Other deferred tax assets are recognised only to the
extent there is reasonable certainty of realisation in future. Deferred
tax assets/ liabilities are reviewed on yearly basis to reassess their
realisation.
11. Foreign Currency Transactions / Fluctuations
a. Foreign exchange transactions are recorded as per the rates
prevailing on the dates of transactions and at year end are restated at
rate as on Balance Sheet date.
b. Resultant Foreign exchange gain/ loss on restatement of Assets /
Liabilities are charged to the Statement of Profit & Loss.
12. Earnings per share
In determining earnings per share, the Company considers the net profit
after tax and includes the post tax effect of any extraordinary items.
The number of shares used in computing basic earnings per share is
weighted average number of shares outstanding during the period.
For the purpose of computing diluted earnings per share, the net profit
attributable to equity shareholders and the weighted average number of
shares outstanding are adjusted for the effects of all dilutive
potential equity shares from exercise of options on un- issued share
capital.
13. Provisions, Contingent Liabilities & Contingent Assets
Disputed liabilities and claims against the Company including claims
raised by various revenue authorities (eg. Sales Tax, Income Tax,
Excise etc.), pending in appeal/court for which no reliable estimates
can be made of the amount of the obligation or which are remotely
poised for crystallisation are not provided for in accounts but
disclosed in Notes to Financial Statements.
However, present obligation as a result of past event with possibility
of outflow of resources, when reliable estimable, is recognised in
accounts.
A contingent asset is neither recognised nor disclosed in the financial
statements.
14. segment Reporting Policies
The Company prepares its segment information, in conformity with the
accounting policies adopted for preparing and presenting the financial
statements of the Company as a whole.
15. Leases
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership over the leased term are classified as
operating leases. Operating lease rentals are recognised as an expense,
as applicable, over the lease period.
16. investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as Non Current investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Non Current investments are carried at
cost. However, provision for diminution in value is made to recognise
a decline other than temporary in the value of the investments.
17. Cash & Cash Equivalents
Cash and Cash equivalents for the purpose of cash flow statement
comprise cash at bank and in hand and short-term investments with an
original maturity of three months or less.
Mar 31, 2010
1. Method of Accounting
The Financial statements have been prepared on accrual basis, except
wherever otherwise stated, under the historical cost convention, in
accordance with the accounting principles generally accepted in India
and comply with the Accounting Standards as referred to in the
Companies (Accounting Standards) Rules 2006 issued by the Central
Government in exercise of power conferred under sub-section (i)(a) of
section 642 and the relevant provisions of the Companies Act, 1956.
2. Use of Estimates
The preparation of the financial statements in conformity with the
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosures of contingent liabilities on the date
of financial statements. Actual results could differ from those
estimates. Any revision to accounting estimates is recognised
prospectively in the current and future periods.
3. Fixed Assets
Fixed Assets are stated at the cost of acquisition (inclusive of all
incidental expenses incurred towards acquisition and installation
thereof) less accumulated depreciation thereon.
Impairment of assets:
If the carrying amount of fixed assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price and the value in use determined by the present
value of estimated future cash flow. Impairment loss is charged to
Profit and Loss Account.
4. Depreciation
i. The Company provides depreciation on fixed assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV to the
Companies Act, 1956. In respect of leasehold improvements, the Company
amortises the entire value over their useful life as estimated by the
management or primary period of lease including any further renewal
period thereof, whichever is lower.
ii. Depreciation on assets each costing less than Rs. 5000/- is
provided for at 100% of the cost as specified in Schedule XIV to the
Companies Act, 1956.
iii. Goodwill on demerger is amortised over Ten Years in equal annual
instalments.
5. Capital Work in Progress
Projects under commissioning and other capital work-in-progress are
carried at cost, comprising direct cost and related incidental
expenses.
6. Revenue Recognition
i. Revenue is recognised on sale of products when no significant
uncertainty as to its determination or realisation exists.
ii. Sales are shown net of returns and Value Added Tax and are
inclusive of Tailoring services.
iii. Purchases, consistently accounted on the basis of actual receipt
of goods, are shown net of returns, turnover incentives and other
incidental charges and include freight charges.
iv. Interest Income is recognised on time proportion basis taking into
account the amount outstanding and the rate applicable.
v. Compensation are recognised on receipt basis.
7. Inventories
Finished Goods comprising of Textiles and Made-ups (including
accessories) are carried at the lower of cost or Net Realisable value,
where cost comprises of all purchase costs and other costs incurred in
bringing the inventories to their present location and condition.
8. Borrowing Costs
Borrowing costs attributable to the acquisition/construction of a
qualifying asset are capitalised as part of the cost of such assets
upto the period assets are ready for their intended use. Other
borrowing costs are recognised as an expense in the period in which
they are incurred.
9. Retirement and other Employee Benefits
The Company contributes towards Provident Fund and Superannuation fund
which are defined contribution schemes. Provision for Gratuity and
Leave encashment is made on the basis of Actuarial Valuations done by
Independent Actuaries on each Balance Sheet date, forming part of
defined benefit plans.
10. Accounting for Taxes on Income
i. Current tax is determined as the amount of tax payable in respect
of taxable income for the year, based on the
applicable tax rates and tax laws.
ii. Deferred tax is recognised on timing differences, being the
difference between taxable income and
accounting income that originate in one period and are capable of
reversal on one or more subsequent periods and is measured using tax
rates that have been enacted or substantively enacted as on the Balance
Sheet date. Where there is unabsorbed depreciation or carry forward
losses, deferred tax assets are recognised only if there is virtual
certainty of realisation of such assets. Other deferred tax assets are
recognised only to the extent there is reasonable certainty of
realisation in future. Deferred tax assets/ liabilities are reviewed on
yearly basis to reassess their realisation or otherwise.
iii. Fringe Benefit Tax (FBT) payable under the provisions of section
115 WC of the Income Tax Act, 1961 is in accordance with the Guidance
Note on Accounting for Fringe Benefits Tax issued by the Institute of
Chartered Accountants of India regarded as an additional income tax.
11. Foreign Currency / Fluctuation
i. Foreign Exchange transactions are recorded as per the rates
prevailing on the dates of transactions and at
year end are restated at rate as on Balance sheet date.
ii. Resultant Foreign exchange gain/ loss on restatement of Assets /
Liabilities are charged to the Profit &
Loss Account.
12. Earnings per Share
In determining earnings per share, the company considers the net profit
after tax and includes the post tax effect of any extraordinary items.
The number of shares used in computing basic earnings per share is
weighted average number of shares outstanding during the period.
For the purpose of computing diluted earnings per share, the net profit
attributable to equity shareholders and the weighted average number of
shares outstanding are adjusted for the effects of all dilutive
potential equity shares from exercise of options on un- issued share
capital.
13. Provisions, Contingent Liabilities & Contingent Assets
Disputed liabilities and claims against the Company including claims
raised by various revenue authorities (Eg Sales Tax, Income Tax, Excise
etc), pending in appeal/court for which no reliable estimates can be
made of the amount of the obligation or which are remotely poised for
crystallisation are not provided for in accounts but disclosed in Notes
on Accounts.
However, present obligation as a result of past event with possibility
of outflow of resources, when reliably estimable, is recognised in
accounts.
A contingent asset is neither recognised nor disclosed in the financial
statements.
14. Investments
i. Investment in shares being in the nature of long term investments
is carried at cost of acquisition.
ii. Quoted current investments are stated at the lower of cost and
market value.
iii Unquoted current investments are stated at lower of cost and fair
value where available.
15. Segment Reporting Policy
The company prepares its segment information if any, in conformity with
the accounting policies adopted for preparing and presenting the
financial statements of the company as a whole.