Home  »  Company  »  IL&FS Investment Man  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of IL&FS Investment Managers Ltd. Company

Mar 31, 2013

A) Basis for preparation of Financial Statements

The Financial Statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles in India pursuant to the Companies (Accounting Standard) Rules, 2006. All income and expenditure having material bearing on the Financial Statements are recognized on an accrual basis

The preparation of Financial Statements requires the Management to make certain estimates and assumptions considered in the reported amounts of Assets and Liabilities (including Contingent Liabilities) as on the date of the Financial Statements and the reported Income and Expenses during the reporting period. The Management believes that the estimates used in preparation of the Financial Statements are prudent and reasonable. Actual results could differ from these estimates. Any changes in such estimates are recognized prospectively

b) Fixed Assets (Tangible and Intangible) and Depreciation / Amortisation

Fixed Assets have been capitalized at cost of acquisition and other incidental expenses

Depreciation on fxed asset is provided pro-rata from the date on which asset is ready to be put to use for its intended purpose on Straight-Line Method based on the estimated useful life of the assets, which are as follows :

All categories of assets costing Rs. 5,000/- or less each and mobile phones, tablet devices and soft furnishing are written off in the year of capitalization

c) Operating Leases

Leases where the lessor effectively retains substantially all the risks and benefts of ownership over the lease term are classifed as operating lease. Lease rental expenses in respect of operating leases is equated over the lease period

d) Investments

i) Investments are recognized at actual cost including costs incidental to acquisition

ii) Investments are classifed as long-term or current at the time of acquisition of such investments

iii) Long term investments are individually valued at cost less provision for diminution, other than temporary

iv) Current investments are valued at lower of cost or fair value, computed scrip-wise

e) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the rate prevailing on the date of transaction. Foreign currency monetary items outstanding as at the Balance Sheet date are restated at the closing rate

(ii) Non-Monetary items which are carried in terms of historical cost denominated in foreign currency at the Balance Sheet date are reported using the exchange rate at the date of the transaction

f) Derivative Transactions

The Company enters into forward contracts to hedge its assets and liabilities

The premium or discount arising at the inception of a Forward Contract is amortised as income or expense over the life of such Contract

At the reporting date, Forward contracts are revalued and gains/losses if any, are recognized in the Statement of Proft and Loss

g) Revenue Recognition

i) Income from Investment in Units of Private Equity Funds (PEF) is recognized on the basis of income distributed by the respective PEFs

ii) Management fee income on PEF under management and advisory fee income are recognized based on contractual arrangements

iii) Dividend income is recognized once the unconditional right to receive dividend is established

iv) Interest income on fxed deposits is accrued proportionately based on period for which the same is placed

h) Employee Benefts

i) Contributions to Provident Fund and Superannuation Fund are charged as expenses in the Statement of Proft and Loss as per applicable law/rules

ii) The Company has taken group gratuity cum life assurance scheme with Life Insurance Corporation of India for gratuity payable to the employees. Incremental liability based on actuarial valuation as per the projected unit credit method as at the reporting date, is charged as Expenses in the Statement of Proft and Loss

iii) The leave balance is classifed as short term and long term based on the past trends. The leave encashment liability for the expected leave to be encashed has been measured on actual components eligible for leave encashment and expected leave to be availed is valued based on the total cost to the Company. The Short term and Long term leave have been valued on actuarial basis as per the projected unit credit method

i) Placement Fees Expense

Placement Fees paid to the Arranger of PEF are recognized over period of 5 years

j) Taxation

Tax Expense comprises of Current Tax and net changes in Deferred Tax Assets or Liability during the year. Current Tax is measured at the amount of tax payable in respect of taxable income for the year in accordance with the Income tax Act, 1961 enacted in India

Deferred Tax Assets and Liabilities are recognised for the future tax consequences of timing differences arising from differences in accounting policies as per the accounts drawn up under the Companies Act, 1956 and the Income tax Act, 1961. Deferred Tax Assets and Liabilities other than on carry forward losses and unabsorbed depreciation under tax laws are recognised when it is reasonably certain that there will be future taxable income. Deferred Tax Asset on carry forward losses and unabsorbed depreciation, if any, are recognised when it is virtually certain that there will be future taxable proft

Deferred Tax Assets and Liabilities are measured using substantively enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the Proft and Loss statement in the period of substantive enactment of the change

k) Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized when the Company has a present legal or constructive obligation as a result of a past event and it is probable that the outfow of resources would be required to settle the obligation, and in respect of which a reliable estimate can be made. Provisions are reviewed at each balance sheet date and are adjusted to refect the current best estimates. A Contingent Liability is disclosed unless the possibility of an outfow of resources embodying the economic benefts is remote. Contingent Assets are neither recognized nor disclosed in the fnancial statements

l) Cash fow Statements

i) Cash fows are reported using the indirect method, whereby proft/(loss) before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash fows from operating, investing and fnancing activities of the Company are segregated based on the available information

ii) Cash comprises cash on hand. Cash Equivalents are cheque on hand, balances in bank current account and EEFC account

m) Earnings Per Share

In determining earnings per share, the Company considers the net proft after tax. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the weighted average shares considered for deriving basic earnings per share, and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless issued at a later date

f) Proposed Dividend

The Company has proposed dividend for the year ended March 31, 2013, on Equity Shares @ Rs. 1.50 per share aggregating to Rs. 366,610,694/- inclusive of dividend distribution tax of Rs. 53,254,829/- g) Forfeited shares

During the fnancial year 1997-98 the Company had forfeited 10,000 equity shares of Rs. 2 each on which amount paid up was Rs. 20,000/-


Mar 31, 2012

A) Basis for preparation of Financial Statements

The Financial Statements are prepared in accordance with the applicable Accounting Standards pursuant to the Companies (Accounting Standard) Rules, 2006. All income and expenditure having material bearing on the Financial Statements are recognized on an accrual basis

The preparation of Financial Statements requires the Management to make certain estimates and assumptions considered in the reported amounts of Assets and Liabilities (including Contingent Liabilities) as on the date of the Financial Statements and the reported Income and Expenses during the reporting period. The Management believes that the estimates used in preparation of the Financial Statements are prudent and reasonable. Actual results could differ from these estimates

b) Fixed Assets (Tangible and Intangible)

Fixed Assets have been capitalized at cost of acquisition and other incidental expenses

Depreciation on fixed asset is provided pro-rata from the date on which asset is ready to be put to use for its intended purpose on Straight-Line Method based on the estimated useful life of the assets, which are as follows :

c) Operating Leases

Leases where the less or effectively retains substantially all the risks and benefits of ownership over the lease term are classified as operating lease. Lease rental expenses in respect of operating leases is recognized in accordance with the Accounting Standard on "Leases'(AS 19)

d) Investments

i) Investments are capitalized at actual cost including costs incidental to acquisition

ii) Investments are classified as long term or current at the time of acquisition of such investments

iii) Long term investments are individually valued at cost less provision for diminution, other than temporary

iv) Current investments are valued at lower of cost or fair value, computed scrip-wise

e) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the rate prevailing on the date of transaction. Foreign currency monetary items outstanding as at the Balance Sheet date are restated at the closing rate

(ii) Non-Monetary items which are carried in terms of historical cost denominated in foreign currency at the Balance Sheet date are reported using the exchange rate at the date of the transaction

f) Derivative Transactions

The Company enters into forward contracts to hedge its assets and liabilities

The premium or discount arising at the inception of a Forward Contract is amortised as income or expense over the life of such Contract

At the reporting date, Forward contracts are marked-to-market and gains/losses if any, are recognized in the Statement of Profit and Loss

g) Revenue Recognition

i) Management fee income on funds under management and advisory fee income are recognized based on contractual arrangements

ii) Income from Investment in Units of Private Equity Funds (PEF) is recognized on the basis of income distributed by the respective PEFs

iii) Dividend income is recognized once the unconditional right to receive dividend is established

iv) Interest income on fixed deposits is accrued proportionately based on period for which the same is placed

h) Employee Benefits

i) Contributions to Provident Fund and Superannuation Fund are charged as Expenses in the Statement of Profit and Loss as per applicable law/rules

ii) The Company has taken group gratuity cum life assurance scheme with Life Insurance Corporation of India for gratuity payable to the employees. Incremental liability based on actuarial valuation as per the projected unit credit method as at the reporting date, is charged as Expenses in the Statement of Profit and Loss

iii) The leave balance is classified as short term and long term based on the past trends. The leave encashment liability for the expected leave to be enchased has been measured on actual components eligible for leave encashment and expected leave to be availed is valued based on the total cost to the Company. The Short term and Long term leave have been valued on actuarial basis as per the projected unit credit method

i) Placement Fees Expense

Placement Fees paid to the Arranger of Fund are recognised over period of 5 years

j) Taxation

Income tax comprises of Current Tax and net changes in Deferred Tax Assets or Liability during the year. Current Tax is determined at the amount of tax payable in respect of taxable income for the year as per the Income tax Act, 1961

Deferred Tax Assets and Liabilities are recognized for the future tax consequences of timing differences arising from differences in accounting policies as per the accounts drawn up under the Companies Act, 1956 and the Income tax Act, 1961. Deferred Tax Assets and Liabilities other than on carry forward losses and unabsorbed depreciation under tax laws are recognized when it is reasonably certain that there will be future taxable income. Deferred Tax Asset on carry forward losses and unabsorbed depreciation, if any, are recognized when it is virtually certain that there will be future taxable profit. Deferred tax assets and liabilities are measured using substantively enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Profit and Loss Account in the period of substantive enactment of the change

k) Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized when the Company has a present legal or constructive obligation as a result of a past event and it is probable that the outflow of resources would be required to settle the obligation, and in respect of which a reliable estimate can be made. Provisions are reviewed at each balance sheet date and are adjusted to reflect the current best estimates. A Contingent Liability is disclosed unless the possibility of an outflow of resources embodying the economic benefits is remote. Contingent Assets are neither recognized nor disclosed in the financial statements

l) Cash flow Statements

i) Cash flows are reported using the indirect method, whereby profit/(loss) before tax is adjusted for the effects of transactions of non -cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating , investing and financing activities of the Company are segregated based on the available information

ii) Cash comprises cash on hand. Cash Equivalents are cheque on hand, balances in bank current account and EEFC account

m) Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the weighted average shares considered for deriving basic earnings per share, and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless issued at a later date

d) Shares options granted and outstanding under the Company's Employee Share Option Plans

As at March 31, 2012 , executives and senior employees held options of 1,361,000 equity shares of the Company, the range of exercise price for Stock Option outstanding as at March 31, 2012 is Rs 13.60 to Rs 19.20 and the weighted average remaining contractual life is 1.29 years. Share options granted under the Company's employee share option plan carry no rights to dividends and no voting rights


Mar 31, 2010

A) Basis for preparation of Financial Statements

The financial statements are prepared under the historical cost convention in accordance with the applicable Accounting Standards pursuant to Companies (Accounting Standard) Rules, 2006. All income and expenditure having material bearing on the financial statements are recognised on an accrual basis

The preparation of financial statements requires the Management to make certain estimates and assumptions in the reported amounts of assets and liabilities (including contingent liabilities) as on the date of the financial statements and the reported income and expenses during the reporting period. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Actual results could differ from these estimates

b) Revenue Recognition

i) Management fee income on funds under management and advisory fee income are recognised based on contractual arrangements

ii) Income from Investment in Units of Private Equity Funds (PEF) is recognised on the basis of income distributed by the respective PEFs

iii) Dividend income is recognised once the unconditional right to receive dividend is established

iv) Interest income on fixed deposits is accrued proportionately based on period for which the same is placed

c) Fixed Assets

FixedAssetsarestated at costof acquisition and other incidental expenses

Depreciation on fixed asset is provided pro-rata from the date on which asset is ready to be put to use for its intended purpose on Straight-Line Method based on the estimated useful life of the assets, which are as follows:

All categories of assets costing Rs 5,000/- or less each and mobile phones are written off in the year of capitalisation

Intangible Assets include business know how, value of Management and Advisory Contracts and related intangible assets acquired by the Company. These Intangible Assets are amortised overthe estimated useful life of 5 years on Straight-Line Method

d) Investments

i) Investments are capitalised at actual cost including costs incidental to acquisition

ii) I nvestments are classified as long term or current at the time of making such investments

iii) Long term investments are individually valued at cost less provision fordiminution, otherthan temporary

iv) Currentinvestmentsarevaluedatlowerofcostorfairvalue,computedscrip-wise

e) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the rate prevailing on the date of transaction. Foreign currency monetary items outstanding as at the Balance Sheet date are restated at the closing rate. The premium or discount arising at the inception of a Forward Contract is amortised as income or expense over the life of such Contract

(ii) Non-Monetary items which are carried in terms of historical cost denominated in foreign currency at the Balance Sheet date are reported using the exchange rate at the date of the transaction

f) Employee Benefits

i) Contributions to Provident Fund and Superannuation Fund are charged to the Profit and Loss Account as per applicable law/rules

ii) The Company has taken group gratuity cum life assurance scheme with Life Insurance Corporation of India for gratuity payable to the employees. Incremental liability based on actuarial valuation as per the projected unit credit method as at the reporting date, is charged to the Profit and Loss Account

iii) The leave balance is classified as short term and long term based on the best estimates after considering the past trends. The short term leave encashment liability for the expected leave to be encashed has been measured on actual components eligible for leave encashment and expected short term leave to be availed is valued based on the total cost to the Company and Long term leave have been valued on actuarial basis

g) Taxation

Income tax comprises of Current Tax and net changes in Deferred Tax Assets or Liability during the year. Current Tax isdeterminedattheamountoftaxpayableinrespectof taxable income fortheyearasperthe Income taxAct, 1961

Deferred Tax Assets and Liabilities are recognised for the future tax consequences of timing differences arising from differences in accounting policies as per the accounts drawn up under the Companies Act and the Income tax Act. Deferred Tax Assets and Liabilities other than on carryforward losses and unabsorbed depreciation under tax laws are recognised when it is reasonably certain that there will be future taxable income. Deferred Tax Asset on carry forward losses and unabsorbed depreciation, if any, are recognised when it is virtually certain that there will be future taxable profit. Deferred tax assets and liabilities are measured using substantively enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in the Profit and Loss Account in the period of substantive enactment of the change

h) Cash and Cash equivalent

Cash and Cash equivalent comprises cash on hand, demand deposits with banks, short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value

i) Earnings PerShare

In determining earnings per share, the Company considers the net profit after tax. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year. The number of shares used in computing diluted earnings pershare comprises the weighted average shares considered for deriving basic earnings pershare, and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless issued at a laterdate

j) Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when the Company has a present obligation as a result of a past event and it is probable that the outflow of resources would be required to settle the obligation, and in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on the best estimates at the balance sheet date required to settle the obligation. Provisions are reviewed at each balance sheet date and are adjusted to reflect the current best estimation. Acontingent liability is disclosed unless the possibility of an outflow of resources embodying the economic benefits is remote. Contingent Assets are neither recognised nor disclosed in the financial statements

k) Placement Fees Expense

Placement Fees payable to the Arranger of Fund are recognized over the life of the managed scheme

 
Subscribe now to get personal finance updates in your inbox!