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Accounting Policies of ETT Ltd. Company

Mar 31, 2015

1. BASIS OF PREPARATION

These Financial Statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention, as applicable to going concern, on the accrual basis except for certain financial instruments which are measured at fair values. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (Act') read with Rule 7 of the Companies (Accounts) Rules, 2014 and the provisions of the Act (to extent notified) and guidelines issued by Securities and Exchange Board of India (SEBI). The accounting policies have been consistently applied by the Company and are consistent with those used in previous year.

a) USE OF ESTIMATES

The preparation of financial statements requires management to make estimates and assumptions that affect the re- ported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of the changes in circumstances surrounding the estimates. Changes in estimates are reflected in the Financial Statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

b) FIXED ASSETS

Fixed Assets are stated at their original cost of acquisition or construction less accumulated depreciation (except land) and impairment loss if any. Cost comprises of purchase price and all expenses directly attributable to the acquisition or construction of the asset. Capital Work-in-Progress are capitalized as and when they are ready for use or put to use whichever is earlier. Till such time expenses incurred related to project and prior to commencement of project, including borrowing costs are capitalized under Capital Work-in-Progress.

c) DEPRECIATION /AMORTIZATION

Depreciation on tangible assets is provided on the Written down Value (WDV) Method over the useful lives of as- sets prescribed in Schedule II of the Companies Act, 2013. Depreciation for assets purchased/ sold during a period is provided on Pro-rata basis. Intangible assets are amortized over the respective individual estimated useful lives on Straight Line Method (SLM) basis, commencing from the date the asset is available to the Company for its use. Amortization has not been provided on the leasehold land.

d) INVENTORIES

Items of Inventory are valued at lower of cost or estimated realizable value. The valuation of inventories is made as per the requirements of Accounting Standard – 2, "Valuation of Inventories", prescribed under the Companies (Ac- counting Standards) Rules, 2006.

e) INVESTMENTS

Long Term Investments are stated at cost as per the requirements of Accounting Standard – 13, "Accounting for Investments", prescribed under the Companies (Accounting Standards) Rules, 2006. Decline in the value of long- term investments is recognized, if considered other than temporary.

Current Investments are stated at lower of cost or market value.

f) PROVISION FOR RETIREMENT BENEFITS

i) Periodical contributions made to the concerned authorities towards Provident Fund and ESI are charged to Revenue on accrual basis.

ii) The Company operates three defined benefit plans for its employees, viz. Gratuity, Leave Encashment (Earned Leave) and Leave Encashment (Sick Leave). As per the requirements of Accounting Standard – 15, "Employee Benefits", prescribed under the Companies (Accounting Standards) Rules, 2006, the costs of providing benefits under these plans are determined on the basis of actuarial valuation at each year-end. Separate actuarial valuation is carried out for each plan using the projected unit credit method. Actuarial gains and losses for the all (three) defined benefit plans are recognized in full in the period in which they occur in the Statement of Profit and Loss. The liability under all three defined benefit plans is unfunded.

g) TAXATION

Income tax comprises current tax and deferred tax. Current tax is the amount of tax payable as determined in accordance with the provisions of the Income Tax Act, 1961. As per the requirements of Accounting Standard – 22, "Accounting for Taxes on Income", prescribed under the Companies (Accounting Standards) Rules, 2006, deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the balance sheet date.

Minimum Alternative Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as current tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which company recognizes MAT credit as an asset in accordance with "Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Act, 1961", the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement".

h) EXPENSES

The Company has charged all expenses on accrual basis of accounting.

i) INCOME

The Company has recognized all incomes on accrual basis of accounting as per the requirements of Accounting Standard - 9, "Revenue Recognition", prescribed under the Companies (Accounting Standards) Rules, 2006.

Interest Income on late payment of dues by customers is recognized on actual receipt basis.

j) DERIVATIVE CONTRACTS

For transactions in derivative contracts, the company has adopted Guidance Note on Accounting for Derivative Contracts (2015) issued by Institute of Chartered Accountants of India. Accordingly, as on the balance sheet date derivative contracts have been valued at fair value derived by taking the market value of respective derivatives at the concerned stock exchanges where the derivative contracts are outstanding. Gains and/or losses arising on the above basis have been recognized in the Statement of Profit & Loss.

k) FOREIGN CURRENCY TRANSACTIONS

Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction.

l) IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying value of asset exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identifed as impaired. The impairment loss recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable value.

m) BORROWING COSTS

Borrowing costs that are attributable to the acquisition and/ or construction of a qualifying asset are capitalized as part of the cost of such asset and other borrowing costs are recognized as an expense in the period in which they are incurred. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.

n) LEASE

Assets given under operating leases are included under fixed assets. Lease income is recognized in the Statement of Profit and Loss on a straight line basis over the lease term. Costs, including depreciation are recognized as an expense in the Statement of Profit and Loss. Initial Direct Costs are charged to the Statement of Profit and Loss in period in which the same are incurred.

o) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Depending upon the facts of each case and after due evaluation of legal aspects, claims against the Company not acknowledged as debts are treated as contingent liabilities. 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. In respect of statutory dues disputed and contested by the Company, Contingent Liabilities are provided for and disclosed as per original demand without taking into account any interest or penalty that may accrue thereafter. Contingent Liabilities are not recognized but are disclosed in the notes. Contin- gent Assets are neither recognized nor disclosed in the financial statements.

p) INTANGIBLE ASSETS

According to Accounting Standard - 26 on "Intangible Assets" prescribed under the Companies (Accounting Standards) Rules, 2006, in case of an expenditure incurred by the Company which may provide future economic benefits to the Company, however out of which, no intangible asset or other asset is acquired or created that can be recognized, the expenditure is recognized as an expense as and when it is incurred.

q) CASH FLOW STATEMENT

Cash Flows are reported using the indirect method as set out in the Accounting Standard - 3 on "Cash Flow Statement" prescribed under the Companies (Accounting Standards) Rules, 2006, whereby net profit before tax is adjusted for the effects of the transactions of non-cash nature and any deferrals or accruals of the past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

r) CASH AND CASH EQUIVALENTS

Cash and Cash Equivalents for the purpose of "Cash Flow Statement" comprise cash at bank and in hand and de- posits with bank with an original maturity of three months or less.

s) EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted number of equity shares outstanding during the period.

For the purpose of calculating of diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted number of equity shares outstanding during the period are adjusted for the effects of all potentially dilutive equity shares.

Defined Benefit Plans

The Company operates three defined benefit plans, viz., Gratuity, Leave Encashment (Earned Leave) and Leave Encashment (Sick Leave) for its employees. Under Gratuity Plan, every employee who has completed at least five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service. The liability is unfunded.

Under Leave Encashment (Earned Leave) Plan, every employee who has completed at least one year of service is eligible to get 15 earned leaves. The liability is unfunded.

Under Leave Encashment (Sick Leave) Plan, every employee who has completed at least three months of service is eligible to get 6 sick leaves on proportionate basis in a year. The liability is unfunded.


Mar 31, 2014

A) USE OF ESTIMATES

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are reflected in the Financial Statements for the period in which the results are known/ materialized.

b) FIXED ASSETS

Fixed Assets are stated at their original cost of acquisition or construction less accumulated depreciation (except land) and impairment loss if any. Cost comprises of purchase price and all expenses directly attributable to the acquisition or construction of the asset. Capital Work-in-Progress are capitalized as and when they are ready for use or put to use whichever is earlier. Till such time expenses incurred related to project and prior to commencement of project, including financing costs are capitalized under Capital Work-in-Progress, which also includes material at site.

c) DEPRECIATION / AMORTIZATION

i) Depreciation has been provided on the value capitalized on the assets actually put to use during the current year, as per the Written down Value (WDV) Method at rates prescribed in Schedule XIV of the Companies Act, 1956.

ii) Depreciation is calculated on pro-rata basis from the date of acquisition and/or capitalization, as may be applicable.

iii) Assets individually costing Rs. 5,000/- (Rupees Five Thousand only) or less are fully depreciated in the year of purchase.

iv) Amortization has not been provided on the leasehold land.

d) INVENTORIES

Inventories are valued as under:

Stores and Spares - At lower of cost or estimated realizable value

Stock of Software - At lower of costor estimated realizable value

The valuation of inventories are made as per the requirements of Accounting Standard - 2, "Valuation of Inventories", prescribed under the Companies (Accounting Standards) Rules, 2006.

e) INVESTMENTS

Long Term Investments are stated at cost as per the requirements of Accounting Standard -13, "Accounting for Investments", prescribed under the Companies (Accounting Standards) Rules, 2006. Decline in the value of long-term investments is recognized, if considered other than temporary.

Current Investments are stated at lower of cost or market value.

f) PROVISION FOR RETIREMENT BENEFITS

i) Periodical contributions made to the concerned authorities towards Provident Fund and ESI are charged to Revenue on accrual basis,

ii) The Company operates three defined benefit plans for its employees, viz. Gratuity, Leave Encashment (Earned Leave) and Leave Encashment (Sick Leave). As per the requirements of Accounting Standard - 15, "Employee Benefits", prescribed under the Companies (Accounting Standards) Rules, 2006, the costs of providing benefits under these plans are determined on the basis of actuarial valuation at each year-end. Separate actuarial valuation is carried out for each plan using the projected unit credit method. Actuarial gains and losses for the all (three) defined benefit plans are recognized in full in the period in which they occur in the Statement of profit and loss. The liability under all three defined benefit plans is unfunded.

g) TAXATION

Income tax comprises current tax and deferred tax. Current tax is the amount of tax payable as determined in accordance with the provisions of the Income Tax Act, 1961. As per the requirements of Accounting Standard -22, "Accounting for Taxes on Income", prescribed under the Companies (Accounting Standards) Rules, 2006, deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the balance sheet date.

Minimum Alternative Tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which company recognizes MAT credit as an asset in accordance with "Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Act, 1961", the said asset is created by way of credit to the statement of profit and loss and shown as " MAT Credit Entitlement".

h) EXPENSES

The Company has charged all expenses on accrual basis of accounting.

i) INCOME

The Company has recognized all incomes on accrual basis of accounting as per the requirements of Accounting Standard - 9, "Revenue Recognition", prescribed under the Companies (Accounting Standards) Rules, 2006.

j) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rates prevailing on the dates of the transactions.

k) 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 recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable value.

I) BORROWING COSTS

Borrowing cost that is attributable to the acquisition or construction of a qualifying asset is capitalized as part of the cost of such asset and other borrowing costs are recognized as an expense in the period in which they are incurred. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.

m) LEASE

Assets given under operating leases are included in fixed assets. Lease income is recognized in the Statement of Profit and Loss on a straight line basis over the lease term. Costs, including depreciation are recognized as an expense in the statement of profit and loss.

n) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Depending upon the facts of each case and after due evaluation of legal aspect, claims against the Company not acknowledged as debts are treated as contingent liabilities. 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. In respect of statutory dues disputed and contested by the Company, Contingent Liabilities are provided for and disclosed as per original demand without taking into account any interest or penalty that may accrue thereafter. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements,

o) INTANGIBLE ASSETS

According to Accounting Standard -26 on "Intangible Assets" prescribed under the Companies (Accounting Standards) Rules, 2006, in case of an expenditure incurred by the Company which may provide future economic benefits to the Company, however out of which, no intangible asset or other asset is acquired or created that can be recognized, the expenditure is recognized as an expense as and when it is incurred.

p) CASH FLOW STATEMENT

Cash Flows are reported using the indirect method as set out in the Accounting Standard - 3 on "Cash Flow Statement" prescribed under the Companies (Accounting Standards) Rules, 2006, whereby net profit before tax is adjusted for the effects of the transactions of non-cash nature and any deferrals or accruals of the past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

q) CASHAND CASH EQUIVALENTS

Cash and Cash Equivalents for the purpose of "Cash Flow Statement" comprise cash at bank and in hand and deposits with bank with an original maturity of three months or less.

r) EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted number of equity shares outstanding during the period.

For the purpose of calculating of diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted number of equity shares outstanding during the period are adjusted for the effects of all potential dilutive equity shares.


Mar 31, 2013

A) USE OF ESTIMATES

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are reflected in the Financial Statements for the period in which the results are known / materialized.

b) FIXED ASSETS

Fixed Assets are stated at their original cost of acquisition or construction less accumulated depreciation (except land) and impairment loss if any. Cost comprises of purchase price and all expenses directly attributable to the acquisition or construction of the asset. Capital Work-in-Progress are capitalized as and when they are ready for use or put to use whichever is earlier. Till such time expenses incurred related to project and prior to commencement of project, including financing costs are capitalized under Capital Work-in-Progress, which also includes material at site.

c) DEPRECIATION /AMORTIZATION

i) Depreciation has been provided on the value capitalized on the assets actually put to use during the current year, as per the Written down Value (WDV) Method at rates prescribed in Schedule XIV of the Companies Act, 1956.

ii) Depreciation is calculated on pro-rata basis from the date of acquisition and/or capitalization, as may be applicable.

iii) Assets individually costing Rs. 5,000/- (Rupees Five Thousand only) or less are fully depreciated in the year of purchase.

iv) Amortization has not been provided on the leasehold land.

d) INVENTORIES

Inventories have been valued as under:

Stores and Spares - At lower of cost or estimated realizable value

Stock of Software - At lower of cost or estimated realizable value

The valuation of inventories has been made as per the requirements of Accounting Standard – 2, "Valuation of Inventories", prescribed under the Companies (Accounting Standards) Rules, 2006.

e) INVESTMENTS

Long Term Investments are stated at cost as per the requirements of Accounting Standard – 13, "Accounting for Investments", prescribed under the Companies (Accounting Standards) Rules, 2006. Decline in the value of long-term investments is recognized, if considered other than temporary. Current Investments are stated at lower of cost or market value.

f) PROVISION FOR RETIREMENT BENEFITS

i) Periodical contributions made to the concerned authorities towards Provident Fund and ESI are charged to Revenue on accrual basis.

ii) The Company operates three defined benefit plans for its employees, viz. Gratuity, Leave Encashment (Earned Leave) and Leave Encashment (Sick Leave). As per the requirements of Accounting Standard – 15, "Employee Benefits", prescribed under the Companies (Accounting Standards) Rules, 2006, the costs of providing benefits under these plans are determined on the basis of actuarial valuation at each year-end. Separate actuarial valuation is carried out for each plan using the projected unit credit method. Actuarial gains and losses for all the three defined benefit plans are recognized in full in the period in which they occur in the Statement of profit and loss. The liability under all three defined benefit plans is unfunded.

g) TAXATION

Income tax comprises current tax and deferred tax. Current tax is the amount of tax payable as determined in accordance with the provisions of the Income Tax Act, 1961. As per the requirements of Accounting Standard – 22, "Accounting for Taxes on Income", prescribed under the Companies (Accounting Standards) Rules, 2006, deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the balance sheet date. Minimum Alternative Tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which company recognizes MAT credit as an asset in accordance with "Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Act, 1961", the said asset is created by way of credit to the statement of profit and loss and shown as " MAT Credit".

h) EXPENSES

The Company has charged all expenses on accrual basis of accounting.

i) INCOME

The Company has recognized all incomes on accrual basis of accounting as per the requirements of Accounting Standard – 9, "Revenue Recognition", prescribed under the Companies (Accounting Standards) Rules, 2006.

j) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rates prevailing on the dates of the transactions.

k) 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 recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable value.

l) BORROWING COSTS

Borrowing cost that is attributable to the acquisition or construction of a qualifying asset is capitalized as part of the cost of such asset and other borrowing costs are recognized as an expense in the period in which they are incurred. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.

m) LEASE

Assets given under operating leases are included in fixed assets. Lease income is recognized in the Statement of Profit and Loss on a straight line basis over the lease term. Costs, including depreciation are recognized as an expense in the statement of profit and loss.

n) 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.

o) INTANGIBLE ASSETS

According to Accounting Standard – 26 on "Intangible Assets" prescribed under the Companies (Accounting Standards) Rules, 2006, in case of an expenditure incurred by the Company which may provide future economic benefits to the Company, however out of which, no intangible asset or other asset is acquired or created that can be recognized, the expenditure is recognized as an expense as and when it is incurred.

p) CASH FLOW STATEMENT

Cash Flows are reported using the indirect method as set out in the Accounting Standard - 3 on "Cash Flow Statement" prescribed under the Companies (Accounting Standards) Rules, 2006, whereby net profit before tax is adjusted for the effects of the transactions of non-cash nature and any deferrals or accruals of the past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

q) CASH AND CASH EQUIVALENTS

Cash and Cash Equivalents for the purpose of "Cash Flow Statement" comprise cash at bank and in hand and deposits with bank with an original maturity of three months or less.

r) EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted number of equity shares outstanding during the period. For the purpose of calculating of diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted number of equity shares outstanding during the period are adjusted for the effects of all potential dilutive equity shares.


Mar 31, 2012

A) USE OF ESTIMATES

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are reflected in the Financial Statements for the period in which the results are known / materialized.

b) FIXED ASSETS

Fixed Assets are stated at their original cost of acquisition or construction less accumulated depreciation (except land) and subsequent improvements thereto. Cost comprises of purchase price and all expenses directly attributable to the acquisition or construction of the asset. Expenses incurred related to project and prior to commencement of business, including financing costs are capitalized under Capital Work-in-Progress, which also includes material at site.

c) DEPRECIATION /AMORTIZATION

i) Depreciation has been provided on the value capitalized on the assets actually put to use during the current year, as per the Written down Value (WDV) Method at rates prescribed in Schedule XIV of the Companies Act, 1956.

ii) Depreciation is calculated on pro-rata basis from the date of acquisition and/or capitalization, as may be applicable.

iii) Assets costing individually Rs. 5,000/- (Rupees Five Thousand only) or less are depreciated fully in the year of purchase.

iv) Amortization has not been provided on the leasehold land.

d) INVENTORIES

Inventories have been valued as under:

Diesel - At lower of cost or estimated realizable value

Stock of Software - At lower of cost or estimated realizable value

The valuation of inventories has been made as per the requirements of Accounting Standard-2, "Valuation of Inventories", prescribed under the Companies (Accounting Standards) Rules, 2006.

e) INVESTMENTS

Long Term Investments are stated at cost as per the requirements of Accounting Standard – 13, "Accounting for Investments", prescribed under the Companies (Accounting Standards) Rules, 2006. Provision for diminution in the value of long-term investment is not made as the decline in the value of Investment is considered temporary by the management.

f) PROVISION FOR RETIREMENT BENEFITS

i) Periodical contributions made to the concerned authorities towards Provident Fund and ESI are charged to Revenue on accrual basis.

ii) The Company operates three defined benefit plans for its employees, viz. Gratuity, Leave Encashment (Earned Leave) and Leave Encashment (Sick Leave). As per the requirements of Accounting Standard – 15, "Employee Benefits", prescribed under the Companies (Accounting Standards) Rules, 2006, the costs of providing benefits under these plans are determined on the basis of actuarial valuation at each year-end. Separate actuarial valuation is carried out for each plan using the projected unit credit method. Actuarial gains and losses for the all (three) defined benefit plans are recognized in full in the period in which they occur in the Statement of profit and loss. The liability under all three defined plans is unfunded.

g) TAXATION

Income tax comprises current tax and deferred tax. Current tax is the amount of tax payable as determined in accordance with the provisions of the Income Tax Act, 1961. As per the requirements of Accounting Standard – 22, "Accounting for Taxes on Income", prescribed under the Companies (Accounting Standards) Rules, 2006, deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the balance sheet date. Minimum Alternative Tax (MAT) paid in a year is charged to the Statement of profit and loss as current tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which company recognizes MAT credit as an asset in accordance with "Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Ta x Act, 1961", the said asset is created by way of credit to the statement of profit and loss and shown as " MAT Credit".

h) EXPENSES

The Company has charged all expenses on accrual basis of accounting.

i) INCOME

The Company has recognized all incomes on accrual basis of accounting as per the requirements of Accounting Standard – 9, "Revenue Recognition", prescribed under the Companies (Accounting Standards) Rules, 2006.

j) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rates prevailing on the dates of the transactions.

k) 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 & Loss in the year in which an asset is identified as impaired. The Impairment loss recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable value.

l) BORROWING COSTS

Borrowing cost that is attributable to the acquisition or construction of a qualifying asset is capitalized as part of the cost of such asset and other borrowing costs are recognized as an expense in the period in which they are incurred. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.

m) LEASE

Assets given under operating leases are included in fixed assets. Lease income is recognized in the Statement of Profit & Loss on a straight line basis over the lease term. Costs, including depreciation are recognized as an expense in the Statement of profit & loss.

n) 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.

o) INTANGIBLE ASSETS

According to Accounting Standard – 26 on "Intangible Assets" prescribed under the Companies (Accounting Standards) Rules, 2006, in case of an expenditure incurred by the Company which may provide future economic benefits to the Company, however out of which, no intangible asset or other asset is acquired or created that can be recognized, the expenditure is recognized as an expense as and when it is incurred.

p) CASH FLOW STATEMENT

Cash Flows are reported using the indirect method as set out in the Accounting Standard - 3 on "Cash Flow Statement" prescribed under the Companies (Accounting Standards) Rules, 2006, whereby net profit before tax is adjusted for the effects of the transactions of non-cash nature and any deferrals or accruals of the past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

q) CASH AND CASH EQUIVALENTS

Cash and Cash Equivalents for the purpose of "Cash Flow Statement" comprise cash at bank and in hand and deposits with bank with an original maturity of three months or less.


Mar 31, 2011

A) ACCOUNTING CONVENTION

The financial statements have been prepared under the historical cost convention, as applicable to a going concern and in accordance with generally accepted accounting principles in India, mandatory accounting standards and provisions of the Companies Act, 1956.

b) USE OF ESTIMATES

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are recognised in the period in which the results are known / materialized.

c) FIXED ASSETS

Fixed Assets are stated at their original cost of acquisition or construction less accumulated depreciation (except land) and subsequent improvements thereto. Cost comprises of purchase price and all expenses directly attributable to the acquisition or construction of the asset. Expenses incurred related to project and prior to commencement of business, including financing costs are capitalized under Capital Work-in-Progress Account, which also includes material at site.

d) DEPRECIATION /AMORTIZATION

i) Depreciation has been provided on the value capitalized on the assets actually put to use during the current year, as per the Written Down Value Method at rates prescribed in Schedule XIV of the Companies Act, 1956.

ii) Depreciation is calculated on pro-rata basis from the date of acquisition and/or capitalization, as may be applicable.

iii) Assets costing individually Rs. 5,000/- (Rupees Five Thousand only) or less are depreciated fully in the year of purchase.

iv) Amortization has not been provided on the leasehold land.

e) INVENTORIES

Inventories have been valued as under:

Diesel - At lower of cost or estimated realizable value

Stock of Software - At lower of cost or estimated realizable value

The valuation of inventories has been made as per the requirements of Accounting Standard - 2, "Valuation of Inventories", prescribed under the Companies (Accounting Standards) Rules, 2006.

f) INVESTMENTS

Long Term Investments are stated at cost as per the requirements of Accounting Standard - 13, "Accounting for Investments", prescribed under the Companies (Accounting Standards) Rules, 2006. Provision for diminution in the value of long-term investment is not made as the decline in the value of Investment is considered temporary by the management.

g) PROVISION FOR RETIREMENT BENEFITS

i) Periodical contributions made to the concerned authorities towards Provident Fund and ESI are charged to Revenue on accrual basis.

ii) 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 amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of long term benefits are charged to the Profit and Loss account. The liability is unfunded.

h) TAXATION

Income tax comprises current tax and deferred tax. Current tax is the amount of tax payable as determined in accordance with the provisions of the Income Tax Act, 1961. Deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the balance sheet date.

i) EXPENSES

The Company has charged all expenses on accrual basis of accounting.

j) INCOME

The Company has recognized all incomes on accrual basis of accounting as per the requirements of Accounting Standard - 9, "Revenue Recognition", prescribed under the Companies (Accounting Standards) Rules, 2006.

k) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rates prevailing on the dates of the transactions.

l) 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 Profit & Loss Account in the year in which an asset is identified as impaired.

m) BORROWING COSTS

Borrowing cost that is attributable to the acquisition or construction of a qualifying asset is capitalised as part of the cost of such asset and other borrowing costs are recognized as an expense in the period in which they are incurred. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.

n) LEASE

Assets given under operating leases are included in fixed assets. Lease income is recognized in the Profit & Loss Account on a straight line basis over the lease term. Costs, including depreciation are recognized as an expense in the profit & loss account.

o) 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.

p) INTANGIBLE ASSETS

According to Accounting Standard - 26 on "Intangible Assets" prescribed under the Companies (Accounting Standards) Rules, 2006, in case of an expenditure incurred by the Company which may provide future economic benefits to the Company, however out of which, no intangible asset or other asset is acquired or created which can be recognized, the expenditure is recognized as an expense as and when it is incurred.

q) CASH FLOW STATEMENT

Cash Flows are reported using the indirect method as set out in the Accounting Standard - 3 on "Cash Flow Statement" prescribed under the Companies (Accounting Standards) Rules, 2006, whereby net profit before tax is adjusted for the effects of the transactions of non cash nature and any deferrals or accruals of the past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.