Mar 31, 2015
COMPANY OVERVIEW
IEC Education Limited (the "Company') was incorporated on 23rd
August,1994 in India as a public limited Company. The Company made an
initial public offer in March, 1996. As at 31st March, 2015 the Company
is listed on Three Stock exchanges in India namely Bombay Stock
Exchange, Delhi Stock Exchange and Jaipur Stock Exchange. The Company
has three Subsidiaries located in India. The Company's business
consists of Computer education, Franchisee business & Personality
development programme.
1.1) Basis of Accounting:
The accompanying financial statements have been prepared in compliance
with the requirements under section 133 of the Companies Act, 2013 (to
the extent notified), read with Rule 7 of the Companies (Accounts)
Rules, 2014, and other generally accepted accounting principles (GAAP)
in India, to the extent applicable, under the historical cost
convention, on the accrual basis of accounting, GAAP comprises
standards as specified in the Companies (Accounting Standards) Rules,
2006.
1.2) Use of Estimates:
The preparation of financial statements in conformity with Generally
Accepted Accounting Principles (GAAP) in India requires management to
make estimates and assumptions that affect the reported amount of
assets and liabilities and the disclosure of contingent liabilities on
the date of financial statements and the reported amount of revenue 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.
1.3) Fixed assets:
1) Tangible fixed assets are stated at cost less accumulated
depreciation and impairment losses if any. Cost of acquisition or
construction is inclusive of freight, duties, taxes and incidental
expenses related to such acquisition or construction.
2) Intangible fixed assets are stated at cost less amortization.
1.4) Depreciation
Depreciation is systematically allocated over the useful life of an
asset as specified in part C of schedule II of Companies Act.2013.
1.5) Investments:
Investments are classified into long term and current investments based
on the intent of management at the time of acquisition. Long-term
investments are stated at cost of acquisition and related expenses.
Provision is made to recognize a decline, other than temporary, in the
value of long term investments on an individual s.
Current investments are carried at the lower of cost and net realizable
value.
1.6) Employee Benefits:
Short term employee benefits are recognized as an expense at the
undiscounted amount in the Statement of Profit & Loss Account of the
year in which the relative service is rendered.
Provision for gratuity is made, in the books of account as per the
provisions of Payment of Gratuity Act, 1972 on the assumption that all
the employees are entitled to gratuity at the end of the accounting
year. Provision for leave encashment is provided for at the end of
financial year on the basis of last month drawn salary of the
employees.
1.7) Revenue Recognition:
The revenue in respect of sale of courseware is recognized on delivery
of materials. The revenue from training and education activity is
recognized over the period of the course program. Revenue in respect of
other consultancy receipts is recognized upon rendering of the service.
All other income are accounted for on accrual basis. Claims including
insurance claims are accounted for on the acceptance and determination
of the amounts recoverable by the concerned authorities.
1.8) Dividend:
Dividend proposed, if any, by the Board of Directors as appropriation
of profit is provided for in the books of account pending approval of
the shareholders at the annual general meeting.
1.9) Taxes on Income:
The expense comprises current and deferred tax. Current tax is measured
at the amount expected to be paid to the tax authorities in accordance
with the Income Tax Act, 1961. The impact of current year timing
differences between taxable income and accounting income for the year
is recognized as a deferred tax asset or deferred tax liability. The
tax effect is calculated on accumulated timing differences at the end
of accounting year, based on effective tax rate substantively enacted
by the balance date. Deferred tax assets are recognized only to the
extent that there is a reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized in future; however where there is unabsorbed
depreciation or carry forward of losses, deferred tax assets are
recognized only if there is a virtual certainty of realization of such
assets.
1.10) Borrowing Cost:
Financing costs relating to borrowed funds attributable to construction
or acquisition of qualifying assets for the period up to the completion
of construction or acquisition of such assets are included in the costs
of the assets. Other financing costs are recognized as an expense in
the period in which they are incurred.
1.11) Leases:
Lease arrangements where the risk and rewards incidental to ownership
of an asset substantially vest with the lessor are recognized as
operating leases. Payments under operating lease are recognized in
statement of profit & loss account on a accrual basis over the lease
term. Rental income is recognized on accrual basis over the lease term.
1.12) Impairment of Assets:
Management periodically assesses using external and internal sources
whether there is an indication that an asset may be impaired.
Impairment occurs where the carrying value exceeds the present value of
future cash flows expected to arise from the continuing use of asset
and its eventual disposal. The impairment loss to be expensed is
determined as the excess of the carrying amount over the higher of the
asset's net sales price or present value as determined above. An
impairment loss is reversed only to the extent that the assets carrying
amount does not exceed the carrying amount that would have been determined
net of depreciation or amortization, if no impairment loss had been
recognized.
1.13) Provision and Contingencies:
The Company recognizes a provision when there is a present obligation
as results of a past event and it is probable that it would involve an
outflow of resources and a reliable estimate can be made of the amount
of such obligation. Such provisions are not discounted to their present
value and are determined based on the management's estimation of the
obligation required to settle the obligation at the balance sheet date.
These are reviewed at each balance sheet date and adjusted to reflect
management's current estimates.
A disclosure for a contingent liability is made where it is more likely
than not that a present obligation or possible obligation may result in
or involve an outflow of resources. When no present or possible
obligation exists and the possibility of an outflow of resources is
remote, no disclosure is made.
Contingent assets are not recognised in the financial statements.
1.14) Operating cycle:
Based on the nature of products / activities of the Company and the
normal time between acquisition of assets and their realisation in cash
or cash equivalents, the Company has determined its operating cycle as
12 months for the purpose of classification of its assets and
liabilities as current and non-current.
Mar 31, 2014
1.1) Basis of preparation:
The financial statements are prepared under the historical cost
convention on the accrual basis, in accordance with the Indian
Generally Accepted Accounting Principles ("GAAP") and mandatory
accounting standards as prescribed in the Companies (Accounting
Standard) Rules,2006, the provisions of the Companies Act,1956 and
guidelines issued by the Securities and Exchange Board of India
("SEBI")
1.2) Use of Estimates:
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and reported amount
of revenues and expenses during the reporting period and the
disclosures relating to contingent liabilities as of the date of the
Financial Statements. Although these estimates are based on the
management's best knowledge of current events and actions, the actual
outcome may be different from the estimates. Difference between actual
results and estimates are recognized in the period in which results are
known or materialise.
1.3) Fixed assets:
1) Tangible fixed assets are stated at cost less accumulated
depreciation and impairment losses if any. Cost of acquisition or
construction is inclusive of freight, duties, taxes and incidental
expenses related to such acquisition or construction.
2) Intangible fixed assets are stated at cost less amortization.
1.4) Depreciation and Amortization
1) Depreciation on tangible fixed assets is provided on the
straight-line method at the rates and in the manner laid down in
schedule XIV to the Companies Act, 1956.
2) Depreciation has been provided on pro-rata basis in respect of
addition to/deletion from the intangible fixed assets with reference to
the date of addition/deletion of the assets.
3) Goodwill arising on acquisition of business unit is amortized over a
period of ten years.
4) Leasehold land in the nature of perpetual lease is not amortized.
1.5) Investments:
Investments are classified into long term and current investments based
on the intent of management at the time of acquisition. Long- term
investments are stated at cost of acquisition and related expenses.
Provision is made to recognize a decline, other than temporary, in the
value of long term investments on an individual basis.
Current investments are carried at the lower of cost and net realizable
value.
1.6) Employee Benefits:
Short term employee benefits are recognized as an expense at the
undiscounted amount. in the Statement of Profit & Loss Account of the
year in which the relative service is rendered.
Provision for gratuity is made, in the books of account as per the
provisions of Payment of Gratuity Act, 1972 on the assumption that all
the employees are entitled to gratuity at the end of the accounting
year. Provision for leave encashment is provided for at the end of
financial year on the basis of last month drawn salary of the
employees.
1.7) Revenue Recognition:
The revenue in respect of sale of courseware is recognized on delivery
of materials. The revenue from training and education activity is
recognized over the period of the course program. Revenue in respect of
other consultancy receipts is recognized upon rendering of the service.
All other income are accounted for on accrual basis. Claims including
insurance claims are accounted for on the acceptance and determination
of the amounts recoverable by the concerned authorities.
1.8) Dividend:
Dividend proposed, if any, by the Board of Directors as appropriation
of profit is provided for in the books of account pending approval of
the shareholders at the annual general meeting.
1.9) Miscellaneous Expenditure:
Preliminary, share issue and deferred revenue expenditure are being
written off over a period of five years from the date of commencement
of commercial operation.
1.10) Taxes on Income:
The expense comprises current and deferred tax. Current tax is measured
at the amount expected to be paid to the tax authorities in accordance
with the Income Tax Act,1961. The impact of current year timing
differences between taxable income and accounting income for the year
is recognized as a deferred tax asset or deferred tax liability. The
tax effect is calculated on accumulated timing differences at the end
of accounting year, based on effective tax rate substantively enacted
by the balance date. Deferred tax assets are recognized only to the
extent that there is a reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized in future; however where there is unabsorbed
depreciation or carry forward of losses, deferred tax assets are
recognized only if there is a virtual certainty of realization of such
assets.
1.11) Borrowing Cost:
Financing costs relating to borrowed funds attributable to construction
or acquisition of qualifying assets for the period up to the completion
of construction or acquisition of such assets are included in the costs
of the assets. Other financing costs are recognized as an expense in
the period in which they are incurred.
1.12) Leases:
Lease arrangements where the risk and rewards incidental to ownership
of an asset substantially vest with the lessor are recognized as
operating leases. Payments under operating lease are recognized in
statement of profit & loss account on a accrual basis over the lease
term. Assets lease out under operating leases are Capitalised. Rental
income is recognized on accrual basis over the lease term.
1.13) Impairment of Assets:
Management periodically assesses using external and internal sources
whether there is an indication that an asset may be impaired.
Impairment occurs where the carrying value exceeds the present value of
future cash flows expected to arise from the continuing use of asset
and its eventual disposal. The impairment loss to be expensed is
determined as the excess of the carrying amount over the higher of the
asset's net sales price or present value as determined above. An
impairment loss is reversed only to the extent that the assets carrying
amount does not exceed the carrying amount that would have been
determined net of depreciation or amortization, if no impairment loss
had been recognized.
1.14) Provision and Contingencies :
The Company recognized a provision when there is a present obligation
as results of a past event and it is probable that it would involve an
outflow of resources and a reliable estimate can be made of the amount
of such obligation. Such provisions are not discounted to there present
value and are determined based on the management's estimation of the
obligation required to settle the obligation at the balance sheet date.
These are reviewed at each balance sheet date and adjusted to reflect
management's current estimates.
A disclosure for a contingent liability is made where it is more likely
than not that a present obligation or possible obligation may result in
or involve an outflow of resources. When no present or possible
obligation exists and the possibility of an outflow of resources is
remote, no disclosure is made.
Contingent assets are not recognised in the financial statements.
1.15) Operating cycle :
Based on the nature of products / activities of the Company and the
normal time between acquisition of assets and their realisation in cash
or cash equivalents, the Company has determined its operating cycle as
12 months for the purpose of classification of its assets and
liabilities as current and non-current.
Mar 31, 2013
Company Overview
IEC Education Limited (the ACI-Company'') was incorporated on 23rd
August,1994 in India as a public limited Company. The Company made an
initial public offer in March, 1996. As at 31st March, 2013 the Company
is listed on Three Stock exchanges in India namely Bombay Stock
Exchange, Delhi Stock Exchange and Jaipur Stock Exchange. The Company
has three Subsidiaries located in India. The Company''s business
consists of Computer education, Franchisee business ACY- Personality
development programme.
1.1) Basis of preparation:
The financial statements are prepared under the historical cost
convention on the accrual basis, in accordance with the Indian
Generally Accepted Accounting Principles ( ACI-GAAP ACI-) and mandatory
accounting standards as prescribed in the Companies (Accounting
Standard) Rules,2006, the provisions of the Companies Act,1956 and
guidelines issued by the Securities and Exchange Board of India
( ACI-SEBI ACI-)
1.2) Use of Estimates:
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and reported amount
of revenues and expenses during the reporting period and the
disclosures relating to contingent liabilities as of the date of the
Financial Statements. Although these estimates are based on the
management''s best knowledge of current events and actions, the actual
outcome may be different from the estimates. Difference between actual
results and estimates are recognized in the period in which results are
known or materialise.
1.3) Fixed assets:
1) Tangible fixed assets are stated at cost less accumulated
depreciation and impairment losses if any. Cost of acquisition or
construction is inclusive of freight, duties, taxes and incidental
expenses related to such acquisition or construction.
2) Intangible fixed assets are stated at cost less amortization.
1.4) Depreciation and Amortization
1) Depreciation on tangible fixed assets is provided on the
straight-line method at the rates and in the manner laid down in
schedule XIV to the Companies Act, 1956.
2) Depreciation has been provided on pro-rata basis in respect of
addition to/deletion from the intangible fixed assets with reference to
the date of addition/deletion of the assets.
3) Goodwill arising on acquisition of business unit is amortized over a
period of ten years.
4) Leasehold land in the nature of perpetual lease is not amortized.
1.5) Investments:
Investments are classified into long term and current investments based
on the intent of management at the time of acquisition. Long- term
investments are stated at cost of acquisition and related expenses.
Provision is made to recognize a decline, other than temporary, in the
value of long term investments on an individual basis.
Current investments are carried at the lower of cost and net realizable
value.
1.6) Employee Benefits:
Short term employee benefits are recognized as an expense at the
undiscounted amount in the Statement of Profit ACY- Loss Account of the
year in which the relative service is rendered.
Provision for gratuity is made, in the books of account as per the
provisions of Payment of Gratuity Act, 1972 on the assumption that all
the employees are entitled to gratuity at the end of the accounting
year. Provision for leave encashment is provided for at the end of
financial year on the basis of last month drawn salary of the
employees.
1.7) Revenue Recognition:
The revenue in respect of sale of courseware is recognized on delivery
of materials. The revenue from training and education activity is
recognized over the period of the course program. Revenue in respect of
other consultancy receipts is recognized upon rendering of the service.
All other income are accounted for on accrual basis. Claims including
insurance claims are accounted for on the acceptance and determination
of the amounts recoverable by the concerned authorities.
1.8) Dividend:
Dividend proposed, if any, by the Board of Directors as appropriation
of profit is provided for in the books of account pending approval of
the shareholders at the annual general meeting.
1.9) Miscellaneous Expenditure:
Preliminary, share issue and deferred revenue expenditure are being
written off over a period of five years from the date of commencement
of commercial operation.
1.10) Taxes on Income:
The expense comprises current and deferred tax. Current tax is measured
at the amount expected to be paid to the tax authorities in accordance
with the Income Tax Act, 1961. The impact of current year timing
differences between taxable income and accounting income for the year
is recognized as a deferred tax asset or deferred tax liability. The
tax effect is calculated on accumulated timing differences at the end
of accounting year, based on effective tax rate substantively enacted
by the balance date. Deferred tax assets are recognized only to the
extent that there is a reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized in future ADs- however where there is unabsorbed
depreciation or carry forward of losses, deferred tax assets are
recognized only if there is a virtual certainty of realization of such
assets.
1.11) Borrowing Cost:
Financing costs relating to borrowed funds attributable to construction
or acquisition of qualifying assets for the period up to the completion
of construction or acquisition of such assets are included in the costs
of the assets. Other financing costs are recognized as an expense in
the period in which they are incurred.
1.12) Leases:
Lease arrangements where the risk and rewards incidental to ownership
of an asset substantially vest with the lessor are recognized as
operating leases. Payments under operating lease are recognized in
statement of profit ACY- loss account on a accrual basis over the lease
term. Assets lease out under operating leases are Capitalised. Rental
income is recognized on accrual basis over the lease term.
1.13) Impairment of Assets:
Management periodically assesses using external and internal sources
whether there is an indication that an asset may be impaired.
Impairment occurs where the carrying value exceeds the present value of
future cash flows expected to arise from the continuing use of asset
and its eventual disposal. The impairment loss to be expensed is
determined as the excess of the carrying amount over the higher of the
asset''s net sales price or present value as determined above. An
impairment loss is reversed only to the extent that the assets carrying
amount does not exceed the carrying amount that would have been
determined net of depreciation or amortization, if no impairment loss
had been recognized.
1.14) Provision and Contingencies:
The Company recognized a provision when there is a present obligation
as results of a past event and it is probable that it would involve an
outflow of resources and a reliable estimate can be made of the amount
of such obligation. Such provisions are not discounted to there present
value and are determined based on the management''s estimation of the
obligation required to settle the obligation at the balance sheet date.
These are reviewed at each balance sheet date and adjusted to reflect
management''s current estimates.
A disclosure for a contingent liability is made where it is more likely
than not that a present obligation or possible obligation may result in
or involve an outflow of resources. When no present or possible
obligation exists and the possibility of an outflow of resources is
remote, no disclosure is made.
Contingent assets are not recognised in the financial statements.
1.15) Operating cycle:
Based on the nature of products / activities of the Company and the
normal time between acquisition of assets and their realisation in cash
or cash equivalents, the Company has determined its operating cycle as
12 months for the purpose of classification of its assets and
liabilities as current and non-current.
Mar 31, 2010
A) System of Accounting :
The financial statements have been prepared and presented under the
historical cost convention, on the accrual basis of accounting and are
in accordance with the requirements of the Companies Act,1956 and
comply with the Accounting Standards (AS) referred to in sub section
(3C) of Section 211 of the said Act. The preparation of financial
statements requires the management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the
disclosures of contingent liabilities on the date of financial
statements and the reported income and expenses.Actual results could
differ from these estimates.Any revision to accounting estimates is
recognized prospectively in current and future period.
b) Fixed assets :
1) Fixed Assets are stated at cost less accumulated depreciation and
impairment losses if any. Cost of acquisition or construction is
inclusive of freight, duties, taxes and incidental expenses related to
such acquisition or construction.
2) Goodwill is stated at cost less amortization.
c) Depreciation :
1) Depreciation on fixed assets is provided on the straight-line method
at the rates and in the manner laid down in schedule XIV to the
Companies Act, 1956.
2) Depreciation has been provided on pro-rata basis in respect of
addition to/deletion from the fixed assets with reference to the date
of addition/deletion of the assets.
3) Goodwill arising on acquisition of business unit is amortized over a
period of ten years
d) Investment :
1) Long-term investments are stated at cost of acquisition and related
expenses. Provision is made to recognize a decline, other than
temporary, in the value of long term investments on an individual
basis.
2) Current investments are carried at the lower of cost and fare value.
e) Employee Benefit :
Short term employee benefits are recognized as an expense at the
undiscounted amount in the Profit & Loss Account of the year in which
the relative service is rendered. Provision for gratuity is made, in
the books of account as per the provisions of Payment of Gratuity Act,
1972 on the assumption that all the employees are entitled to gratuity
at the end of the accounting year. Provision for leave encashment is
provided for at the end of financial year on the basis of last month
drawn salary of the employees.
f) Revenue Recognition :
The revenue in respect of sale of courseware is recognized on delivery
of materials. The revenue from training and education activity is
recognized over the period of the course program. Revenue in respect of
other consultancy receipts is recognized upon rendering of the service.
Claims including insurance claims are accounted for on the acceptance
and determination of the amounts recoverable by the concerned
authorities.
g) Dividend :
Dividend proposed, if any, by the Board of Directors as appropriation
of profit is provided for in the books of account pending approval of
the shareholders at the annual general meeting.
h) Miscellaneous Expenditure :
Preliminary, share issue and deferred revenue expenditure are being
written off over a period of five years from the date of commencement
of commercial operation.
i) Taxes on Income :
The expense comprises current and deferred tax. Current tax is measured
at the amount expected to be paid to the tax authorities in accordance
with the Income Tax Act,1961. The impact of current year timing
differences between taxable income and accounting income for the year
is recognized as a deferred tax asset or deferred tax liability. The
tax effect is calculated on accumulated timing differences at the end
of accounting year, based on effective tax rate substantively enacted
by the balance date. Deferred tax assets are recognized only to the
extent that there is a reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized in future; however where there is unabsorbed
depreciation or carry forward of losses, deferred tax assets are
recognized only if there is a virtual certainty of realization of such
assets.
j) Borrowing Cost :
Borrowing cost incurred in relation to the acquisition, construction of
assets are capitalized as the part of the cost of such assets upto the
date when such assets are ready for intended use. Other borrowing costs
are charged as expenses in the year in which they are incurred.
k) Leases :
Lease arrangements where the risk and rewards incidental to ownership
of an asset substantially vest with the lessor are recognized as
operating leases. Payments under operating lease are recognized in
profit & loss account on a accrual basis over the lease term. Assets
lease out under operating leases are Capitalised.Rental income is
recognized on accrual basis over the lease term.
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 the
Profit and Loss Account in the year in which an asset is identified as
impaired. The impairment loss recognized in prior accounting periods is
reversed if there has been a change in the estimate of recoverable
amount.
m) Provisions, Contingent Liabilities and Contingent Assets :
Provisions involving substantial degree of estimation in measurement
are recognized in terms of Accounting Standard 29-Ã Provisions,
Contingent Liabilities and Contingent Assetsà (AS-29) notified by the
Companies (Accounting Standards) Rules, 2006 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 recognized
only when there is a possible obligation arising from past events and
the existences of which will be confirmed only by the occurance or non-
occurance of future events not wholly within the control of the
Company. Contingent Assets are neither recognized nor disclosed in
financial statements.
n) General :
The financial statements have been prepared in accordance with
historical cost convention. Accounting policies not specifically
referred to are consistent with GENERALLY ACCEPTED ACCOUNTING
PRACTICES.
Mar 31, 2009
A) System of Accounting:
The financial statements have been prepared and presented under the
historical cost convention, on the accrual basis of accounting and on
the accounting principles of a going concern and comply in all material
respects with the mandatory Accounting Standards (AS), issued by the
institute of Chartered Accountants of India and the relevant provisions
of Companies Act, 1956.
b) Fixed assets:
1) Fixed Assets are stated at cost less accumulated depreciation. Cost
of acquisition or construction is inclusive of freight, duties, taxes
and incidental expenses related to such acquisition or construction.
2) Goodwill is stated at cost less amortization.
c) Depreciation:
1) Depreciation on fixed assets is provided on the straight-line method
at the rates and in the manner laid down in schedule XIV to the
Companies Act, 1956.
2) Depreciation has been provided on pro-rata basis in respect of
addition to/deletion from the fixed assets with reference to the date
of addition/deletion of the assets.
3) Goodwill arising on acquisition of business unit is amortized over a
period often years
d) Investment:
Long-term investments are stated at cost of acquisition and related
expenses. Provision is made to recognize a decline, other than
temporary, in the value of investments.
e) Employee Benefits:
Short term employee benefits are recognized as an expense at the
undiscounted amount in the Profit & Loss Account of the year in which
the relative service is rendered
Provision for gratuity is made, in the books of account as per the
provisions of Payment of Gratuity Act, 1972 on the assumption that all
the employees are entitled to gratuity at the end of the accounting
year. Provision for leave encashment is provided for at the end of
financial year on the basis of last month drawn salary of the
employees.
f) Revenue Recognition:
The revenue in respect of sale of courseware is recognized on delivery
of materials. The revenue from training and education activity is
recognized over the period of the course program. In respect of
software and consultancy activities, the revenue arises and is
recognized on dispatch/delivery of the concerned goods/services. Claims
including insurance claims are accounted for on the acceptance and
determination of the amounts recoverable by the concerned authorities.
d) Dividend:
Dividend proposed, if any, by the Board of Directors as appropriation
of profit is provided for in the books of account pending approval of
the shareholders at the annual general meeting.
e) Miscellaneous Expenditure:
Preliminary, share issue and deferred revenue expenditure are being
written off over a period of five years from the date of commencement
of commercial operation.
f) Provision for current and Deferred Tax
Income taxes are accounted for in accordance with Accounting
Standard-22 on Accounting for Taxes on Income. Provision for tax is
made for current and deferred taxes. Current tax is provided on the
taxable income using the applicable tax rates and tax laws. Deferred
tax assets and liabilities arising on account of timing differences and
which are capable of reversal in subsequent periods are recognized
using the tax rates and tax laws that have been enacted or subsequently
enacted.
g) Borrowing Cost:
Borrowing cost incurred in relation to the acquisition, construction of
assets are capitalized as the part of the cost of such assets upto the
date when such assets are ready for intended use. Other borrowing costs
are charged as an expenses in the year in which they are incurred.
h) Leases:
Lease arrangements where the risk and rewards incidental to ownership
of an asset substantially vest with the lessor are recognized as
operating leases. Payments under operating lease are recognized in
profit & loss account on accural basis over the lease term. Assets
leased out under operating leases are capitalized. Rental income is
recognized on accrual basis over the lease term.
i) Impairment of Assets:
An assets is treated as impaired when the carrying cost of assets
exceeds its recoverable value. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired. The impairment loss recognized in prior accounting periods is
reversed if there has been a change in the estimate of recoverable
amount.
m) 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 resourses.
Contingent liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in
financial statements.
n) General:
The financial statements have been prepared in accordance with
historical cost convention Accounting policies not specifically
referred to are consistent with GENERALLY ACCEPTED ACCOUNTING
PRACTICES.