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Accounting Policies of Dharani Finance Ltd. Company

Mar 31, 2014

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II. FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use.

The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13

IV. RETIREMENT BENEFITS:

The Company''s Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income Tax Act, 1961.

b) Deferred Tax is recognized 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, subject to consideration of prudence.

The Status and Break up as of 31.03.2014 is given below

(Rs.in Lakhs)

DESCRIPTION ASSET

Timing Difference in Depreciable Asset 31.60

Timing difference in Provision against NPA 0.74

Timing Difference in Provision for Bonus 1.36

Timing Difference in Provision for Gratuity & Leave Encashment 4.84

Total 38.54

Net Deferred Tax Asset 38.54

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by The Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company''s reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.


Mar 31, 2012

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II. FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use.

The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13.

IV. RETIREMENT BENEFITS:

The Company's Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income Tax Act, 1961.

b) Deferred Tax is recognized on timing differences being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods, subject to consideration of prudence.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company's reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.


Mar 31, 2011

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II.FIXEDASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use. The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III.INVESTMENTS:

Investments are classified as long as term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13

IV.RETIREMENT BENEFITS:

The Company's Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end. V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under I ncome Tax Act, 1961.

b) Deferred Tax is recognized on timing differences being the difference between taxable fncome and accounting income that originate in one period and are capable of reversal in one or more subsequent periods, subject to consideration of prudence.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company's reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.


Mar 31, 2010

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) overthe period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis. II.FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use. The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13 IV.RETIREMENT BENEFITS:

The Companys Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income TaxAct, 1961.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reportingth issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Companys reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.

 
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