Mar 31, 2015
1.1 Basis of Preparation of Financial Statements
a) Basis of Accounting
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under historical cost
convention on accrual basis. Pursuant to Section 133 of the Companies
Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014,
till the standards of accounting or any addendum thereto are prescribed
by Central Government in consultation and recommendation of the
National Financial Reporting Authority, the existing Accounting
Standards notified under the Companies Act, 1956 shall continue to
apply. Consequently, these financial statements have been prepared to
comply in all material aspects with the accounting standards notified
under Section 211(3C) [Companies (Accounting Standards) Rules, 2006, as
amended] of the Companies Act, 1956 and the other relevant provisions
of the Companies Act, 2013.
b) Use of Estimates
The preparation of financial statements in conformity with Generally
Accepted Accounting Principles requires management to make estimates
and assumptions that affect the reported amounts of assets,
liabilities, revenue and expenses and disclosure of contingent assets
and liabilities. The estimates and assumptions used in the accompanying
financial statements are based upon management evaluation of the
relevant facts and circumstances as on the date of the financial
statements. Actual results may differ from the estimates and
assumptions used in preparing the accompanying financial statements.
Any revisions to accounting estimates are recognised prospectively in
current and future periods.
c) Current / Non Current Classification
All assets and liabilities have been classified as current and
non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule III to the Companies Act, 2013. Based
on the nature of products and services and the time between acquisition
of assets for processing and their realization in cash and cash
equivalents, The Company has ascertained its operating cycle as 12
months for the purpose of current and non- current classification of
asset and liabilities.
1.2 Fixed Assets and Depreciation / Amortization
a) Tangible Fixed Assets
Tangible Assets are stated at cost net of recoverable taxes, trade
discounts and rebates, 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.
Subsequent expenditures related to an item of tangible asset are added
to its book value only if they increase the future benefits from the
existing asset beyond its previously assessed standard of performance.
Losses arising from the retirement of, and gains or losses arising from
disposal of tangible assets which are carried at cost are recognised in
the Statement of Profit and Loss.
Depreciation on tangible fixed assets of the company is provided using
Straight Line Method on pro-rata basis at rates and in manner specified
in Schedule II of the Companies Act, 2013.
b) Impairment
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is impaired when the carrying amount of the asset
exceeds the recoverable amount. An impairment loss is charged to the
statement of Profit and Loss in the year in which an asset is
identified as impaired. An impairment loss recognised in prior
accounting periods is reversed if there has been change in the estimate
of the recoverable amount.
1.3 Investments
Investments are classified into current and non-current investments.
Investments that are readily realizable and intended to be held for not
more than a year from the date of acquisition are classified as current
investments. All other investments are classified as non-current
investments.
Current investments are carried at the lower of cost or fair value. The
comparison of cost and fair value is done separately in respect of each
category of investments.
Non-current investments are stated at cost. A provision for diminution
in the value of long-term investments is made only if such a decline is
other than temporary in the opinion of the management.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is recognised in the Statement of
Profit and Loss.
1.4 Inventories
Securities acquired with the intention of short-term holding and
trading position is disclosed as stock-in-trade. Securities held as
stock-in-trade are valued at lower of cost or market value.
1.5 Revenue Recognition
Revenue is recognised when there is a reasonable certainty of its
ultimate realisation.
Merchant Banking Activities fees are accounted on accrual basis in
accordance with the terms and contracts entered into between the
company and the counterparty.
Consultation fees are accounted on accrual basis depending upon
progress of assignment.
Income from trading in Securities comprises of Profit/loss on sale of
securities held as stock-in-trade. Profit/loss on sale of Securities is
determined on FIFO Basis.
Profit/Loss on equity/ derivative transactions is accounted for on
final settlement or squaring-up of contracts for Equity Index/Stock
Futures, the profit or loss is calculated as difference between
settlement/squaring-up price and contract price and as on the balance
sheet date, the debit balance in the "Mark-to-Market Margin  Equity
Index/Stock Futures Account", being anticipated loss, is recognised in
the profit and loss account. When the Option contracts are squared-up
before expiry of the options, the premium prevailing on that date is
recognised in profit and loss account. On expiry of the contracts and
on exercising the options, the difference between final settlement
price and the strike price is transferred to the profit and loss
account.
Dividend Income is recognised when the right to receive payment is
established.
Profit/Loss earned on sale of Investments is recognised on trade date
basis. Profit/Loss on sale of Investments is determined based on the
weighted average cost of the Investments sold.
Interest income is recognised on accrual basis.
1.6 Employee Benefits
a) Short Term Employees Benefit
Employee benefits payable wholly within twelve months of receiving
employee services are classified as short- term employee benefits.
These benefits include salaries and wages, bonus, short term
compensated absences, ex- gratia, etc. The undiscounted amount of
short-term employee benefits to be paid in exchange for employee
services is recognised as an expense as the related service is rendered
by employees.
b) Post Employment Benefit
Defined Contribution Plans:
A defined contribution plan is a post-employment benefit plan under
which an entity pays specified contributions to a separate entity and
has no obligation to pay any further amounts. The Company makes
specified monthly contributions towards employee provident fund to
Government administered provident fund scheme and Employees' State
Insurance Corporation (ESIC) which are a defined contribution plan. The
Company's contribution is recognised as an expense in the Statement of
Profit and Loss during the period in which the employee renders the
related service.
Defined Benefit Plans:
The Payment of Gratuity Act is not applicable to company since numbers
of eligible employees are less than requisite number.
Termination Benefits:
Termination Benefits are charged to the Statement of Profit and Loss in
the year of accrual.
1.7 Borrowing Cost
Borrowing costs attributable to the acquisition, construction or
production of qualifying assets, are added to the cost of those assets,
upto the date when the assets are ready for their intended use. All
other borrowing costs are expensed in the period they occur.
1.8 Provisions and Contingencies
A provision is recognised if, as a result of a past event, the Company
has a present obligation that can be estimated reliably and it is
probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are recognised at the best estimate
of the expenditure required to settle the present obligation at the
balance sheet date. The provisions are measured on an undiscounted
basis.
A contingent liability exists when there is a possible but not probable
obligation or a present obligation that may, but probably will not,
require an outflow of resources, or a present obligation whose amount
cannot be estimated reliably. Contingent liabilities do not warrant
provisions, but are disclosed unless the possibility of outflow of
resources is remote. Contingent assets are neither recognised nor
disclosed in the financial statements. However, contingent assets are
assessed continually and if it is virtually certain that an inflow of
economic benefits will arise, the asset and related income are
recognised in the period in which the change occurs.
1.9 Taxes on Income
Income tax expenses comprise current and deferred taxes. Current tax is
determined on income for the year chargeable to tax in accordance with
the applicable tax rates and the provisions of the Income Tax Act, 1961
and other applicable tax laws and after considering credit for Minimum
Alternate Tax (MAT) available under the said Act. MAT paid in
accordance with the tax laws which gives future economic benefits in
the form of adjustments to future tax liability, is considered as an
asset if there is convincing evidence that the future economic benefit
associated with it will flow to the Company resulting in payment of
normal income tax.
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 reversing in one or more subsequent periods.
Deferred tax is measured using the tax rates and the tax laws enacted
or substantively enacted as at the reporting date. Deferred tax
liabilities are recognised for all timing differences. Deferred tax
assets are recognised for timing differences of items other than
unabsorbed depreciation and carry forward losses only to the extent
that there is a reasonable certainty that there will be sufficient
future taxable income will be available against which these can be
realised. However if there are unabsorbed depreciation and carry
forward of losses and items relating to capital losses, deferred tax
assets are recognised only if there is virtual certainty supported by
convincing evidence that there will be sufficient future taxable income
available to realise the assets. Deferred tax assets and liabilities
are offset if such items relate to taxes on income levied by the same
governing tax laws and the Company has a legally enforceable right for
such set off. Deferred tax assets are reviewed at each balance sheet
date for their realisability.
1.10 Earnings Per Share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders after deducting
preference dividends and attributable taxes by the weighted average
number of equity shares outstanding during the year.
For the purpose of calculating diluted earning per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares, if
any.
1.11 Cash and Cash Equivalents
The Company considers all highly liquid financial instruments, which
are readily convertible into known amount of cash that are subject to
an insignificant risk of change in value and having original maturities
of three months or less from the date of purchase, to be cash
equivalents.
1.12 Cash Flow Statement
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated with
investing or financing cash flows. The cash flows from operating,
investing and financing activities of the Company are segregated.
In the matter of IPO of RDB Rasayans Limited, SEBI issued Show Cause
Notice ("SCN") dated July 18, 2014 against Chartered Capital And
Investment Limited under Regulation 28(1) of Securities and Exchange
Board of India (Intermediaries) Regulations, 2008 which Was replied by
the Company within the prescribed time. Finally, SEBI has vide its
order dated May 13, 2015, disposed off the matter without any further
direction against the Company in the matter. It will have no
implications on the financial position of the Company.
Mar 31, 2014
1.1 Basis of Preparation of Financial Statements
a) Basis of Accounting
The financial statements of the Company are prepared under the
historical cost convention as a going concern on accrual basis and to
comply in all material aspects with the Accounting Standards prescribed
in the Companies (Accounting Standards) Rules, 2006 issued by the
Central Government, the relevant provisions of the Companies Act, 1956
("the Act") which as per clarification issued by the Ministry of
Corporate Affairs continue to apply under Section 133 of the Companies
Act, 2013 (which has superseded Section 211(3C) of the Act w.e.f 12
September 2013) and other accounting principles generally accepted in
India, to the extent applicable.
b) Use of Estimates
The preparation of financial statements in conformity with Generally
Accepted Accounting Principles requires management to make estimates
and assumptions that affect the reported amounts of assets,
liabilities, revenue and expenses and disclosure of contingent assets
and liabilities. The estimates and assumptions used in the accompanying
financial statements are based upon management''s evaluation of the
relevant facts and circumstances as on the date of the financial
statements. Actual results may differ from the estimates and
assumptions used in preparing the accompanying financial statements.
Any revisions to accounting estimates are recognised prospectively in
current and future periods.
c) Current / Non-Current classification
All assets and liabilities have been classified as current and
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI of the Companies Act, 1956. Based
on the nature of products and services and their realization in cash
and cash equivalents. The Company has ascertained its operating cycle
as 12 months for the purpose of current and non-current classification
of asset and liabilities.
1.2 Fixed Assets and Depreciation / Amortization
a) Tangible Fixed Assets
Fixed Assets are stated at cost of acquisition/construction (net of
recoverable taxes) less Accumulated Depreciation and impairment loss if
any. Cost of acquisition includes non refundable taxes, duties, freight
and other costs that are directly attributable to bringing assets to
their working condition for their intended use. All costs, including
financing costs till the asset is put to use and adjustments arising
from exchange rate variations attributable to the fixed assets are
capitalized.
Depreciation on tangible fixed assets is provided on straight - line
method on pro-rata basis at rates and in manner specified in Schedule
XIV of the Companies Act, 1956.
b) Impairment
At each balance sheet date, the management reviews the carrying amounts
of its assets included in each cash generating unit to determine
whether there is any indication that those assets were impaired. If any
such indication exists, the recoverable amount of the asset is
estimated in orderto determine the extent of impairment. Recoverable
amount is the higher of an asset''s net selling price and value in use.
In assessing value in use, the estimated future cash flows expected
from the continuing use of the asset and from its disposal are
discounted to their present value using a pre-tax discount rate that
reflects the current market assessments of time value of money and the
risks specific to the asset.
Reversal of impairment loss is recognised as income in the statement of
profit and loss.
1.3 Investments
Investments are classified into current and long-term investments.
Investments that are readily realizable and intended to be held for not
more than a year from the date of acquisition are classified as current
investments. All other investments are classified as long-term
investments. However, that part of long term investments which are
expected to be realized within twelve months from Balance Sheet date is
also presented under "Current Assets" under "Current portion of long
term investments" in consonance with the current / non-current
classification of revised Schedule VI to the Companies Act, 1956.
Current investments are stated at the lower of cost and fair value. The
comparison of cost and fair value is done separately in respect of each
category of investments.
Long-term investments are stated at cost. A provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary in the opinion of the management.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is recognised in the Statement of
Profit and Loss.
1.4 Inventories
Securities acquired with the intention of short-term holding and
trading position is disclosed as stock-in-trade. Securities held as
stock-in-trade are valued at lower of cost or market value.
1.5 Revenue Recognition
Revenue is recognised when there is a reasonable certainty of its
ultimate realisation.
Merchant Banking Activities fees are accounted on accrual basis in
accordance with the terms and contracts entered into between the
company and the counterparty.
Consultation fees are accounted on accrual basis depending upon
progress of assignment.
Income from trading in Securities comprises of Profit/loss on sale of
securities held as stock-in-trade. Profit/loss on sale of Securities is
determined on FIFO Basis.
Profit/Loss on equity/ derivative transactions is accounted for on
final settlement or squaring-up of contracts for Equity Index/Stock
Futures, the profit or loss is calculated as difference between
settlement/squaring-up price and contract price and as on the balance
sheet date, the debit balance in the "Mark-to-Market Margin - Equity
Index/Stock Futures Account", being anticipated loss, is recognised in
the profit and loss account. When the Option contracts are squared-up
before expiry of the options, the premium prevailing on that date is
recognised in profit and loss account. On expiry of the contracts and
on exercising the options, the difference between final settlement
price and the strike price is transferred to the profit and loss
account.
Dividend Income is recognised when the right to receive payment is
established.
Profit/Loss earned on sale of Investments is recognised on trade date
basis. Profit/Loss on sale of Investments is determined based on the
weighted average cost of the Investments sold.
Interest income is recognised on accrual basis.
1.6 Employee Benefits
a) ShortTerm Employees Benefit
Employee benefits payable wholly within twelve months of receiving
employee services are classified as short- term employee benefits.
These benefits include salaries and wages, bonus, short term
compensated absences, ex-gratia, etc. The undiscounted amount of
short-term employee benefits to be paid in exchange for employee
services is recognised as an expense as the related service is rendered
by employees.
Defined Contribution Plans
A defined contribution plan is a post-employment benefit plan under
which an entity pays specified contributions to a separate entity and
has no obligation to pay any further amounts. The Company makes
specified monthly contributions towards employee provident fund to
Government administered provident fund scheme which is a defined
contribution plan. The Company''s contribution is recognised as an
expense in the Statement of Profit and Loss during the period in which
the employee renders the related service.
Defined Benefit Plans
The Payment of Gratuity Act is not applicable to company since number
of eligible employees are less than requisite number.
Terminal Benefit
Termination Benefits are charged to Profit and Loss Account in the year
of accrual.
1.7 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a substantial period
of time to get ready for its intended use are capitalized as part of
the cost of the respective asset. All other borrowing costs are
expensed in the period they occur. Borrowing costs consist of interest
and other costs that an entity incurs in connection with the borrowing
of funds.
1.8 Provisions and Contingencies
A provision is recognised if, as a result of a past event, the Company
has a present obligation that can be estimated reliably and it is
probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are recognised at the best estimate
of the expenditure required to settle the present obligation at the
balance sheet date. The provisions are measured on an undiscounted
basis.
A contingent liability exists when there is a possible but not probable
obligation or a present obligation that may, but probably will not;
require an outflow of resources, ora present obligation whose amount
cannot be estimated reliably. Contingent liabilities do not warrant
provisions, but are disclosed unless the possibility of outflow of
resources is remote. Contingent assets are neither recognised nor
disclosed in the financial statements. However, contingent assets are
assessed continually and if it is virtually certain that an inflow of
economic benefits will arise, the asset and related income are
recognised in the period in which the change occurs.
Income tax expense comprises current tax (i.e. amount of tax for the
year determined in accordance with the income-tax law) and deferred tax
charge or credit (reflecting the tax effects of timing differences
between accounting income and taxable income for the year).
Provision for current tax is based on the results for the year ended
31st March, in accordance with the provisions of the Income Tax Act,
1961.
The deferred tax charge or credit and the corresponding deferred tax
liabilities or assets are recognised using the tax rates and tax laws
that have been enacted or substantively enacted by the balance sheet
date. Deferred tax assets are recognised only to the extent there is
reasonable certainty that the assets can be realized in future, however
when there is unabsorbed depreciation or carry forward loss under
taxation laws, deferred tax assets are recognised only if there is a
virtual certainty supported by convincing evidence that sufficient
future taxable income will be available against which such deferred tax
assets can be realized.
Deferred tax assets are reviewed as at each balance sheet date and
written down or written-up to reflect the amount that is reasonably /
virtually certain (as the case may be) to be realized.
Minimum Alternative Tax (MAT) under the provisions of the Income Tax
Act, 1961 is recognized as current tax. The credit available under the
said act in respect of MAT is recognized as an asset only when there is
certainty that the company will pay income tax in future periods and
MAT credit can be carried forward to set-off against the normal tax
liability. MAT credit recognized as an asset is reviewed at each
Balance sheet date and written down to the extent the aforesaid
certainty no longer exists.
1.10 Earning Per Share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders after deducting
preference dividends and attributable taxes by the weighted average
number of equity shares outstanding during the year.
For the purpose of calculating diluted earning per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares, if
any.
1.11 Cash and Cash Equivalent
The Company considers all highly liquid financial instruments, which
are readily convertible into known amount of cash that are subject to
an insignificant risk of change in value and having original maturities
of three months or less from the date of purchase, to be cash
equivalents.
1.12 Cash Flow:
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated with
investing or financing cash flows. The cash flows from operating,
investing and financing activities of the Company are segregated.
2.2 Rights, preferences and restrictions attached to Equity Shares
The company has only one class of equity shares having a par value of
Rs. 10 per share. Each share holder of equity shares is entitled to
one vote per share. In the event of liquidation, the equity
shareholders are eligible to receive the remaining assets of the
company, after distributed of all preferential amounts, in proportion
to their shareholding.
Mar 31, 2013
A. ACCOUNTING CONVENTIONS
I) Basis of Preparation of Financial Statements
The financial statements of the Company are prepared under the
historical cost convention on accrual basis of accounting in all
material respects in accordance with the notified Accounting Standards
by Companies (Accounting Standards) Rules 2006 (as amended) and the
relevant Provisions of the Companies Act,1956. The accounting policies
have been consistently applied by the Company during the year.
The presentation of the accounts is based on the revised Schedule VI of
the Companies Act, 1956. All assets and liabilities are classified in
to current and non-current generally based on criteria of realization /
settlement within twelve months period from the balance sheet date.
II) Use of Estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Practices requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates. Any revision to accounting estimates is
recognized prospectively in current and future periods
b. ACCOUNTING FOR FUTURES & OPTIONS
I. Equity Index / Stock - Futures
(i) Equity Index/Stock-Futures are rnarked-to-market on daily basis.
Debit or credit balance disclosed under Loans & Advances or Current
Liabilities, respectively, in the "Mark-to-Market Margin - Equity
Index/Stock Future Account", represents the net amount paid or received
on the basis of movement in the prices of index/Stock Futures till the
balance sheet date.
(ii) As on the balance sheet date, the profit/loss on open positions in
Index/Stock Futures are accounted for as follows:
> Credit balance in the "Mark-to-Market Margin - Equity Index/Stock
Future Account", Being anticipated profit, is ignored & no credit is
taken in the profit & loss account.
> Debit balance in the "Mark-to-Market Margin - Equity Index/Stock
Futures Account", being anticipated loss, is recognised in the profit
and loss account.
(iii) On final settlement or squaring-up of contracts for Equity
Index/Stock Futures, the profit or loss is calculated as difference
between settlement/squaring-up price and contract price. Accordingly,
debit or credit balance pertaining to the settled/squared-up contract
in "Mark-to-Market Margin - Equity Index/Stock Futures Account" is
recognised in the profit and loss account upon expiry or settlement of
the contracts. When more than one contract in respect of the relevant
series of Equity Index/Stock Futures contract to which the squared-up
contract pertains is outstanding at the time of the squaring-up of the
contract, the contract price of the contract so squared-up is
determined using weighted average method for calculating profit/loss on
squaring- up.
(iv) "Initial Margin - Equity Index/Stock Futures Account",
representing initial margin paid, and "Margin Deposits", representing
additional margin over and above initial margin, for entering into
contracts for Equity Index / Stock Futures, which are released on final
settlement/squaring-up of underlying contracts, are disclosed under
Loans and Advances.
II. Equity Index / Stock - Options
(i) As at the balance sheet date, in the case of long positions,
provisions is made for the amount by which the premium paid for those
options exceeds the premium prevailing on the balance sheet, and in the
case of short positions, for the amount by which premium prevailing on
the balance sheet date exceeds the premium received for those options,
and reflected in "Provisions for Loss on Equity Index/Stock Option
Account".
(ii) When the Option contracts are squared-up before expiry of the
options, the premium prevailing on that date is recognised in profit
and loss account. If more than one option contract in respect of the
same index/stock with the same strike and expiry date to which the
squared-up contract pertains is outstanding at the time of squaring-up
of the contract, weighted average method is followed for determining
profit or loss. On expiry of the contracts and on exercising the
options, the difference between final settlement price and the strike
price is transferred to the profit and loss account. In both the above
cases, premium paid or received for buying or selling the options, as
the case may be, is recognised in the profit and loss account for all
squared-up/settled contracts.
(iii) "Equity Index/Stock options margin account", representing initial
margin paid and "Margin Deposit", representing additional margin paid
over and above initial margin, for entering into contracts for Equity
Index/Stock options, which are released on final settlement/squaring-up
of underlying contracts, are disclosed under Loans and advances.
c. FIXED ASSETS
Tangible Assets
Fixed assets are stated at cost of acquisition/construction less
Accumulated Depreciation and impairment loss if any. Cost of
acquisition includes non refundable taxes, duties, freight and other
costs that are directly attributable to bringing assets to their
working condition for their intended use.
d. DEPRECIATION ON FIXED ASSETS
Tangible Assets
Depreciation on Fixed Assets is provided on straight-line method on
Pro-rata basis at rates and in manner specified in Schedule XIV of the
Companies Act, 1956.
e. IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is impaired when the carrying amount of the asset
exceeds the recoverable amount. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired. An impairment loss recognized in prior accounting periods is
reversed if there has been change in the estimate of the recoverable
amount.
f. 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 long term Investments. Long term
investments are stated at cost of acquisition. Provision for diminution
in value of long term investments is made, only if such decline is
other than temporary.
g. REVENUE RECOGNITION
Revenue is recognised when there is a reasonable certainty of its
ultimate realisation.
(i) Merchant Banking Activities fees are accounted on accrual basis in
accordance with the terms and contracts entered into between the
company and the counterparty.
(ii) Consultation fees are accounted on accrual basis depending upon
progress of assignment.
(iii) Underwriting Commission is recognised on accrual basis and is
exclusive of Service Tax.
(iv) Dividend Income is recognised when the right to receive payment is
established.
(v) Profit/Loss earned on sale of Investments is recognised on trade
date basis. Profit/Loss on sale of Investments is determined based on
the weighted average cost of the Investments sold. Profit/Loss on
closed positions of Derivative instruments is recognised on final
settlement or squaring up of the contracts. For Profit/Loss on
Derivative instruments where the company has open positions at the
year-end refer Point 3 below.
(vi) Interest income is recognised on accrual basis.
(vii) Brokerage earned from primary market operations, i.e. procuring
subscription from investors for public offerings of companies are
recorded on determination of the amount due to the company, once the
allotment of securities is completed.
h. EMPLOYEE BENEFITS
(i) Short Term Employees Benefit
Short Term Benefits are recognized as expenditure at the undiscounted
value in the Profit and Loss Account of the year in which the related
services as rendered.
(ii) Post Employment Benefit
Defined Contribution Plans - Monthly contributions to the Provident
Fund which is defined contribution schemes are charged to Profit and
Loss Account and deposited with the Provident Fund Authorities on
monthly basis.
Defined Benefit Plans - Gratuity to Employees are recognised in Profit
and Loss Account as when paid to Employees.
(iii) Terminal Benefit
Termination Benefits are charged to Profit and Loss Account in the year
of accrual.
i. BORROWING COST
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.
j. TAXES ON INCOME
Tax expense for a year comprises of current tax and deferred tax.
Current tax are measured at the amount expected to be paid to the tax
authorities, after taking into consideration, the applicable deductions
and exemptions admissible under the provisions of the Income tax Act,
1961.
Deferred tax reflects the impact of current year timing differences
between taxable income and accounting income for the year and reversal
of timing difference of earlier years. Deferred tax is measured based
on the tax rates and the tax laws enacted or substantively enacted at
the balance sheet date. Deferred tax assets are recognized only to the
extent that there is reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized. If there is unabsorbed depreciation or carry forward
of losses under tax laws, deferred tax assets are recognized only to
the extent that there is virtual certainty supported by convincing
evidence that sufficient future taxable income will be available
against which such deferred tax assets can be realized.
k. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
Provisions involving substantial degree of estimation in measurement
are recognized 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 recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
I. CASH FLOW STATEMENT
The Cash Flow Statement is prepared by the Indirect Method set out in
Accounting Standards on Cash Flow Statement & presents cash flows by
operating, investing & financing activities of the Company.
Cash and Cash Equivalent for the purposes of cash flow statement
comprise cash at bank and in hand and short-term investments with an
original maturity of three months or less.
m. EARNING PER SHARE
Basic earnings per share are calculated by dividing the net profit or
loss for the period attributable to equity shareholders (after
deducting preference dividends and attributable taxes) by the weighted
average number of equity shares outstanding during the period. Partly
equity shares are treated as a fraction of an equity share to the
extent that they are entitled to participate in dividends relative to a
fully paid equity share during the reporting period. The weighted
average number of equity shares outstanding during the period is
adjusted for events such as bonus issue, bonus element in a right share
split and reverse share split (consolidation of shares) that have
changed the number of equity shares outstanding, without a
corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
n. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash in hand, demand deposits with
banks ,other short-term highly Liquid investments with original
maturities of three months or less
Mar 31, 2012
A. Accounting convention (a) Basis of Accounting
The financial statements of the Company are prepared under the
historical cost convention on accrual basis of accounting in all
material respects in accordance with the notified Accounting Standards
by Companies (Accounting Standards) Rules 2006 (as amended) and the
relevant Provisions of the Companies Act,1956. The accounting policies
have been consistently applied by the Company during the year.
(b) Presentation And Disclosure Of Financial Statements
During the year ended 31st March, 2012, the Revised Schedule-VI
notified under Companies Act 1956, has become applicable to the
company, for preparation and presentation of its Financial statements.
The adoption of Revised Schedule-VI does not impact recognition and
measurement principles followed for preparation of Financial
Statements. However, it has significant impact on presentation and
disclosure made in financial statements. The company has also restated
the previous year figures in accordance with the requirements
applicable for the current year.
(c) Use of estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Policies requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates. Any revision to accounting estimates is
recognized prospectively in current and future periods.
B. Revenue recognition
Revenue is recognised when there is a reasonable certainty of its
ultimate realisation.
(a) Merchant Banking Activities fees are accounted on accrual basis in
accordance with the terms and contracts entered into between the
company and the counterparty.
(b) Consultation fees are accounted on accrual basis depending upon
progress of assignment.
(c) Underwriting Commission is recognised on accrual basis and is
exclusive of Service Tax.
(d) Dividend Income is recognised when the right to receive payment is
established.
(e) Profit/Loss earned on sale of Investments is recognised on trade
date basis. Profit/Loss on sale of Investments is determined based on
the weighted average cost of the Investments sold. Profit/Loss on
closed positions of Derivative instruments is recognised on final
settlement or squaring up of the contracts. For Profit/Loss on
Derivative instruments where the company has open positions at the
year-end refer Point 1.3 below.
(f) Interest income is recognised on accrual basis.
(g) Brokerage earned from primary market operations, i.e. procuring
subscription from investors for public offerings of companies are
recorded on determination of the amount due to the company, once the
allotment of securities is completed.
C. Accounting for Futures & Options
i) Equity Index / Stock - Futures
(a) Equity Index/Stock-Futures, are marked-to-market on daily basis.
Debit or credit balance disclosed under Loans & Advances or Current
Liabilities, respectively, in the "Mark-to-Market Margin,- Equity
Index/Stock Future Account", represents the net amount paid or received
on the basis of movement in the prices of index/Stock Futures till the
balance sheet date.
(b) As on the balance sheet date, the profit/loss on open positions in
Index/Stock Futures are accounted for as follows:
- Credit balance in the "Mark*to-Market*Margin - Equity Index/
Stock Future Account", Being anticipated profit, is ignored & no
credit is taken in the profit & loss account.
- Debit balance in the "Mark-to-Market Margin - Equity Index/Stock
Futures Account", being anticipated loss, is recognised in the profit
and loss account.
(c) On final settlement or squaring-up of contracts for Equity
Index/Stock Futures, the profit or loss is calculated is difference
between settlement/squaring-up price and contract price.
Accordingly, debit or credit balance pertaining to the
settled/squared-up contract in "Mark-to-Market Margin - Equity
Index/Stock Futures Account" is recognised in the profit and loss
account upon expiry or settlement of the contracts. When more than one
contract in respect of the relevant series of Equity Index/Stock
Futures contract to which the squared-up contract pertains is
outstanding at the time of the squaring-up of the contract, the
contract price of the contract so squared-up is determined using
weighted average method for calculating profit/loss on squaring- up.
(d) "Initial Margin - Equity Index/Stock Futures Account", representing
initial margin paid, and "Margin Deposits", representing additional
margin over and above initial margin, for entering into contracts for
Equity Index / Stock Futures, which are released on final
settlement/squaring-up of underlying contracts, are disclosed under
Loans and Advances.
ii) Equity Index / Stock- Options
(a) As at the balance sheet date, in the case of long positions,
provisions is made for the amount by which the premium paid for those
options exceeds the premium prevailing on the balance sheet, and in the
case of short positions, for the amount by which premium prevailing on
the balance sheet date exceeds the premium received for those options,
and reflected in "Provisions for Loss on Equity Index/Stock Option
Account".
(b) When the Option contracts are squared-up before expiry of the
options, the premium prevailing on that date is recognised in profit
and loss account. If more than one option contract in respect of the
same index/stock with the same strike and expiry date to which the
squared-up contract pertains is outstanding at the time of squaring-up
of the contract, weighted average method is followed for determining
profit or loss. On expiry of the contracts and on exercising the
options, the difference between final settlement price and the strike
price is transferred to the profit and loss account. In both the above
cases, premium paid or received for buying or selling the options, as
the case may be, is recognised in the profit and toss account for all
squared-up/settled contracts.
(c) "Equity Index/Stock options margin account", representing initial
margin paid and "Margin Deposit", representing additional margin paid
over and above initial margin, for entering into contracts for Equity
Index/Stock options, which are released on final settlement/squaring-up
of underlying contracts, are disclosed under Loans and advances.
D. Fixed Assets Tangible Assets
Fixed assets are stated at cost of acquisition/construction less
Accumulated Depreciation and impairment loss if any. Cost of
acquisition includes non refundable taxes, duties, freight and other
costs that are directly attributable to bringing assets to their
working condition for their intended use.
E. depreciation on Fixed Assets - Tangible Assets
Depreciation on Fixed Assets is provided on straight-line method on
Pro-rata basis at rates and in manner specified in Schedule XIV of the
Companies Act, 1956.
F. 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 lortg term Investments. Long term
investments are stated at cost of acquisition. Provision for diminution
in value of long term investments is made, only if such decline is
other than temporary.
G. Employee Benefits
(a) Short Term Employees Benefit '
Short Term Benefits are recognized as expenditure at the undiscounted
value in the Profit and Loss Account of the year in which the related
services are rendered.
(b) Post Employment Benefit - Defined Contribution Plans -
Monthly contributions to the Prdvident Fund which is defined
contribution schemes aie charyed to Profit'and Loss Accounting
deposited with the Provident Fund Authorities onmonthly basis.
Defined Benefit Piarw - Gratuity, to tmployeesare recognised in
Profit and Loss Account as and when paid to Employees.
(c) terminal Sepent ,
Termination Benefits ate changed to Profit and L'oss Account in the
year of accrual.
H. Borrowing Cost
Borrowing costs that arc* attributable to the acquisition or
construction of qualifying assets are capitalised as part of - the cost
of such assets. A qualifying asset K me that necessarity takes
substantial period of time to get ready for - interKied'Use. All
other fcorrcwmti cgstease,charged to revenue.
I. Taxes on Income ,
Tax expense for a year comprise:; of current tax and deferred tax.
Income tax. Act, 1961.
Deferred tax reflects the impact of current year timing differences
between taxable income alid accounting income for the year and reversal
of timing difference of earlier years. Deferred tax is measured based
on the tax rates and the tax , lawsenacted or stjbstsotivuty enacted at
the balance sheet date. Deferred tax. assets are recognized. to
the extent that there is reasonable certainty that sufficient future
taxable .income will be available, against which such deterred tax
assets can be realized. If there is unabsorbt'd depreciation or carry
forward of losses under tax laws, deferred tax , . assets are
recognized only to the extent that there is virtual, certainty
supported by convincing evidence that sufficient , future taxable
income will be available against which such deferred tax assets can
be.realized .
Mar 31, 2010
1. ACCOUNTING CONVENTIONS
I) Basis of Preparation of Financial Statements
The financial statements of the Company are prepared under the
historical cost convention on accrual basis of accounting in all
material respects in accordance with the notified Accounting Standards
by Companies (Accounting Standards) Rules 2006 (as amended) and the
relevant Provisions of the Companies Act,1956. The accounting policies
have been consistently applied by the Company during the year.
II) Use of Estimates
The preparation of the financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosure of
contingent liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. Any revision to
accounting estimates is recognized prospectively in current and future
periods.
2. REVENUE RECOGNITION
Revenue is recognised when there is a reasonable certainty of its
ultimate realisation.
a Merchant Banking Activities fees are accounted on accrual basis in
accordance with the terms and contracts entered into between the
company and the counterparty.
b Consultation fees are accounted on accrual basis depending upon
progress of assignment.
c Underwriting Commission is recognised on accrual basis and is
exclusive of Service Tax.
d Dividend Income is recognised when the right to receive payment is
established.
e Profit/Loss earned on sale of Investments is recognised on trade date
basis. Profit/Loss on sale of Investments is determined based on the
weighted average cost of the Investments sold. Profit/Loss on closed
positions of Derivative instruments is recognised on final settlement
or squaring up of the contracts. For Profit/Loss on Derivative
instruments where the company has open positions at the year end refer
Point 3 below.
f Interest income is recognised on accrual basis.
3. EQUITY INDEX/STOCK-FUTURE
a) Equity Index/Stock-Futures are marked-to-market on daily basis.
Debit or credit balance disclosed under Loans & Advances or Current
Liabilities, respectively, in the "Mark-to-Market Margin à Equity
Index/Stock Future Account", represents the net amount paid or received
on the basis of movement in the prices of index/Stock Futures till the
balance sheet date.
b) As on the balance sheet date, the profit/loss on open positions in
Index/Stock Futures are accounted for as follows:
- Credit balance in the "Mark-to-Market Margin à Equity Index/Stock
Future Account", Being anticipated profit, is ignored & no credit is
taken in the profit & loss account.
- Debit balance in the "Mark-to-Market Margin à Equity Index/Stock
Futures Account", being anticipated loss, is recognised in the profit
and loss account.
c) On final settlement or squaring-up of contracts for Equity
Index/Stock Futures, the profit or loss is calculated as difference
between settlement/squaring-up price and contract price. Accordingly,
debit or credit balance pertaining to the settled/squared-up contract
in "Mark-to-Market Margin à Equity Index/Stock Futures Account" is
recognised in the profit and loss account upon expiry or settlement of
the contracts. When more than one contract in respect of the relevant
series of Equity Index/Stock Futures contract to which the squared-up
contract pertains is outstanding at the time of the squaring-up of the
contract, the contract price of the contract so squared-up is
determined using weighted average method for calculating profit/loss on
squaring-up.
d) "Initial Margin à Equity Index/Stock Futures Account", representing
initial margin paid, and "Margin Deposits", representing additional
margin over and above initial margin, for entering into contracts for
Equity Index / Stock
Futures, which are released on final settlement/squaring-up of
underlying contracts, are disclosed under Loans and Advances.
4. FIXED ASSETS
Fixed Assets are stated at cost of acquisition/construction less
Accumulated Depreciation and impairment loss if any. Cost of
acquisition includes non refundable taxes, duties, freight and other
costs that are directly attributable to bringing assets to their
working condition for their intended use. All costs, including
financing costs till commencement of commercial production and
adjustments arising from exchange rate variations attributable to the
fixed assets are capitalized.
5. DEPRECIATION
Depreciation on Fixed Assets is provided on straight-line method on
Pro-rata basis at rates and in manner specified in Schedule XIV of the
Companies Act, 1956.
6. 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 long term Investments. Long term
investments are stated at cost of acquisition. Provision for diminution
in value of long term investments is made, only if such decline is
other than temporary.
7. EMPLOYEE BENEFITS
1) Short Term Employees Benefit
Short Term Benefits are recognized as expenditure at the undiscounted
value in the Profit and Loss Account of the year in which the related
services as rendered.
2) Post Employment Benefit
a. Defined Contribution Plans à Monthly contributions to the Provident
Fund which is defined contribution schemes are charged to Profit and
Loss Account and deposited with the Provident Fund Authorities on
monthly basis.
b. Defined Benefit Plans à Gratuity to Employees are recognised in
Profit and Loss Account as when paid to Employees.
3) Termination Benefit
Termination Benefits are charged to Profit and Loss Account in the year
of accrual.
8. BORROWING COST
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. TAXES ON INCOME
Tax expense for a year comprises of current tax and deferred tax.
Current tax are measured at the amount expected to be paid to the tax
authorities, after taking into consideration, the applicable deductions
and exemptions admissible under the provisions of the Income tax Act,
1961.
Deferred tax reflects the impact of current year timing differences
between taxable income and accounting income for the year and reversal
of timing difference of earlier years. Deferred tax is measured based
on the tax rates and the tax laws enacted or substantively enacted at
the balance sheet date. Deferred tax assets are recognized only to the
extent that there is reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized. If there is unabsorbed depreciation or carry forward
of losses under tax laws, deferred tax assets are recognized only to
the extent that there is virtual certainty supported by convincing
evidence that sufficient future taxable income will be available
against which such deferred tax assets can be realized.
10. PROVISIONS, CONTINGENT LIABILITIES AND CONTIGENT ASSETS
Provisions involving substantial degree of estimation in measurement
are recognized 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 recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
11. CASH FLOW STATEMENT
The Cash Flow Statement is prepared by the Indirect Method set out in
Accounting Standards on Cash Flow Statement & presents cash flows by
operating, investing & financing activities of the Company.
12. IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is impaired when the carrying amount of the asset
exceeds the recoverable amount. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired. An impairment loss recognized in prior accounting periods is
reversed if there has been change in the estimate of the recoverable
amount.
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