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Accounting Policies of Indus Finance Ltd. Company

Mar 31, 2015

2.1 Basis of accounting and preparation of financial statements

The financial statements ofthe Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) including Accounting Standards specified under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions ofthe Companies Act, 2013. The financial statements have been prepared on accrual basis underthe historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

2.2 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known /materialise.

2.3 Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant riskof changes in value.

2.4 Cash flow statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and 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 ofthe Company are segregated based on the available information.

2.5 Depreciation and amortisation

Depreciation/amortisation on fixed assets, including revaluation cost and the capitalisation of capital expenditure, are charged over the period ofthe remaining useful life of the asset, arrived at after considering the asset life as prescribed under Schedule-ll to the Companies Act, 2013, adopting straight line method of depreciation/amortisation.

2.6 Revenue recognition-Income from Financing Activity

(i) Interest income is recognised in the Profit and Loss Account as it accrues except in the case of non-performing assets where it is recognised upon realization as per the prudential norms of the Reserve Bank of India. Accrual of income is also suspended on certain other loans where in the opinion ofthe management, significant uncertainties exist as at the year end.

All otherfees are recognised upfront on their becoming due.

2.7 Revenue recognition-Income from Non-Financing Activity

(i) Power income is recognised on accrual basis as they are earned or incurred.

(ii) Dividend income is accounted for when the right to receive it is established.

(iii) Income from otherfinancing activities and services is recognised on accrual basis.

2.8 Tangible fixed assets

Fixed assets are stated at historical cost less accumulated depreciation.

2.9 Investments

Long-term investments, are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lowerof cost and fair value.

2.10 Employee benefits

The Company has not formulated any policy for employee benefits, including Provident Fund, ESI or Gratuity.

2.11 Borrowing costs

Borrowing costs include interest, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Costs in connection with the borrowing of funds to the extent not directly related to the acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the loan.

2.12 Segment Reporting

The company is operating in two business segment viz., Non-Banking Finance and Power Generation.

Details of Segment-wise Assets and Profit & Loss Statement can be reffered in Note No. 21.7.

2.13 Earnings Per Share

Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares.

2.14 Taxes on income

"Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income TaxAct, 1961. Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company. Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences.

2.15 Impairmentofassets

The carrying values of assets are reviewed for impairment at each balance sheet date to ascertain impairment based on internal / external factors. An impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount. The recoverale amount is higher of the netsellilng price of the assets and their value in use.

2.16 Provisions

Provisions are recognised when the Company has present legal or constructive obligations, as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.


Mar 31, 2014

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention except for categories of fixed assets acquired before 1 April, 200X, that are carried at revalued amounts.

1.2 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known /materialise.

1.3 Inventories

Inventories include, Energy generated from Wind Mills and not sold.

1.4 Cash and cash equivalents (for purposes of Cash Flow Statement)

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

1.5 Cash flow statement

The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

1.6 Depreciation and amortisation

Depreciation is provided on the straight-line method as per the rates prescribed in Schedule XIV to the Companies Act, 1956 except in case of windmills where Depreciation is provided at equilant to rates prescribed under Income Tax Act, treating the rates precribed under schedule XIV to the Companies Act, 1956 as minimum.

1.7 Revenue recognition

Power income is recognised on accrual basis as they are earned or incurred.

Interest Income is recognised on the basis of circular issued by RBI for "Non-Banking Financial (Non -Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007" Income from other financing activities and services is recognised on accrual basis.

1.8 Other income

Interest income is accounted on accrual basis. Dividend income is accounted for when the right to receive it is established.

1.9 Tangible fixed assets

Fixed assets are stated at historical cost less accumulated depreciation.

1.10 Investments

Long-term investments, are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value.

1.11 Employee benefits

The Company has not formulated any policy for employee benefits, including Provident Fund, ESI or Gratuity.

The Company is in the position to meet Employee Liability when it becomes due.

1.12 Borrowing costs

Borrowing costs include interest, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Costs in connection with the borrowing of funds to the extent not directly related to the acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the loan.

1.13 Segment Reporting

The company is operating in two business segment viz., Non-Banking Finance and Power Generation.

Details of Segment-wise Assets and Profit & Loss Statement can be reffered in Note No. 21.7.

1.14 Earnings Per Share

Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares.

1.15 Taxes on income

"Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961. Minimum Alternate Tax(MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax.

Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company. Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date.

Deferred tax liabilities are recognised for all timing differences."

1.16 Impairment of assets

The carrying values of assets are reviewed for impairment at each balance sheet date to ascertain impairment based on internal / external factors.

An impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is higher of the net selling price of the assets and their value in use.

1.17 Provisions

Provisions are recognised when the Company has present legal or constructive obligations, as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

1.18 Provisioning requirement as per circular issued by RBI for "NonBanking Financial (Non -Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007" The Circular states that Provision has to be made for Non-Performing Asset on its value if it satisfy certain criteria. The Criteria mentioned in the Circular is reproduced here:

(1) The provisioning requirement in respect of loans, advances and other credit facilities including bills purchased and discounted shall be as under:

(i) Loss Assets

The entire asset shall be written off. If the assets are permitted to remain in the books for any reason, 100% of the outstanding should be provided for;

(ii) Doubtful Assets

(a) 100% provision to the extent to which the advance is not covered by the realisable value of the security to which the mortgage guarantee company has a valid recourse shall be made. The realisable value is to be estimated on a realistic basis;

(b) In addition to item (a) above, depending upon the period for which the asset has remained doubtful, provision to the extent of 20% to 50% of the secured portion (i.e. estimated realisable value of the outstanding) shall be made.

(iii) Sub-standard assets

Ageneral provision of 10% of total outstanding shall be made.


Mar 31, 2013

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally disclosed the Sale Consideration as Income and an amount equal to written down value of asset sold

1.2 The preparation of the financial statements in conformity with Indian GAAP requires the Management

1.3 Inventories

Inventories include, Energy generated from Wind Mills and not sold.

1.4 Cash and cash equivalents (for purposes of Cash Flow Statement)

The cash flows from operating, investing and financing activities of the Company are segregated

1.6 Depreciation the life of the assets has been assessed as under: 9 9

Plant & Machinery - Depreciation has been provided based on the expected useful life of the assets for

Plants Machine^ has been provided for the assets acquired during the earlier years at

1.7 Power income is recognised on accrual basis as they are earned or incurred.

Income from otherfinancing activities and services is recognised on accrual basis.

1.8 Other income

Interest income is accounted on accrual basis. Dividend income is accounted for when the right to Other income received from sale of windmill.

1.9 Tangible fixed assets

Fixed assets are stated at historical cost less accumulated depreciation.

1.10 Investments

1.11 EmpSyeebTneflte''

The Company has not formulated any policy for employee benefits, including Provident Fund, ESI or

Thecompany is in the position to meet Employee Liability when it becomes due.

1.12 Borrowing costs

Borrowing costs include interest, amortisation of ancillary costs incurred and exchange differences acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the

1.13 Segment Reporting

The company is operating in two business segment viz., Non-Banking Finance and Power

DeSfSegment-wise Assets and Profit & Loss Statement can be reffered in Note No. 21.7.

1.14 Earnings PerShare

1.15 TaSonYnTome

Current tax is the ameunt ef tax payable on the taxable income for the year as determined in Pobable that future economic benefit associated with it will flow to the Company Deferred tax is SeSdak

1.16 Impairment of assets

Amount of an asset exceeds its recoverable amount The recoverale amount is higher of thenet sellilngpriceoftheassetsandtheirvalueinuse. 9

1.17 Provisions

settletheebligation and a reliable estimate can be madeforthe amountef theobligation.

1.18 Provisioning requirement as per circular issued by RBI for "Non-Banking Financial (Non - Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007"

The Circular states that Provision has to be made for Non-Performing Asset on its value if it satisify certain criteria. The Criteria mentioned in the Circular is reproduced here:

(1) The provisioning requirement in respect of loans, advances and other credit facilities including bills purchased and discounted shall be as under:

(i) Loss Assets:

The entire asset shall be written off. If the assets are permitted to remain in the books for any reason, 100% of the outstanding should be provided for;

(ii) DoubtfulAssets:

(a) 100% provision to the extent to which the advance is not covered by the realisable value of the security to which the mortgage guarantee company has a valid recourse shall be made. The realisable value is to be estimated on a realistic basis;

(b) In addition to item (a) above, depending upon the period for which the asset has remained doubtful, provision to the extent of 20% to 50% of the secured portion (i.e. estimated realisable value of the outstanding) shall be made.

(ill) Sub-standard assets:

Ageneral provision of 10% of total outstanding shall be made.

The Company has followed the above said prudential norms except in the following cases. Details of such asset along with the Auditor''s recommendation are given below:


Mar 31, 2012

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

1.2 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known/materialise.

1.3 Inventories

Inventories represent, Energy generated from Wind Mills and not sold.

1.4 Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks.

1.5 Cash flow statement

The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

1.6 Depreciation and amortisation

Depreciation has been provided on the straight-line method as per the rates prescribed in Schedule XIV to the Companies Act, 1956 except in respect of the following categories of assets, in whose case the life of the assets has been assessed as under:

Plant & Machinery - Depreciation has been provided based on the expected useful life of the assets forthe assets added during the year.

Plant & Machinery - Depreciation has been provided for the assets acquired during the earlier years at the rates prescribed in Schedule XIV.

The Company has provided depreciation as permitted under Income Tax Act, 1961 on wind mills investments for FY 11-12. Accordingly the current year's depreciation includes Rs. 75,562,500/- charged on such wind mills.

1.7 Revenue recognition

Power income is recognised on accrual basis as they are earned or incurred.

Income from otherfinancing activities and services is recognised on accrual basis.

1.8 Other income

Interest income is accounted on accrual basis. Dividend income is accounted for when the right to receive it is established.

1.9 Tangible fixed assets

Fixed assets are stated at historical cost less accumulated depreciation.

1.10 Intangible assets

The Company has written off during the year the intangible assets against the profits.

1.11 Investments

Long-term investments, are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value.

1.12 Employee benefits

The Company has not formulated any policy for employee benefits, including Provident Fund, ESI or Gratuity.

1.13 Borrowing costs

Borrowing costs are recognised as expenses in the period in which they are actually incurred.

1.14 Taxes on income

Current tax is provided on the taxable income for the year.

Deferred tax liabilities arising from timing differences have been fully provided. Deferred tax assets are recognised on the consideration of prudence.

1.15 Impairment of assets

The carrying values of assets are reviewed for impairment at each balance sheet date to ascertain impairment based on internal / external factors. An impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount. The recoverale amuont is higher of the net sellilng price of the assets and their value in use.

1.16 Provisions

Provisions are recognised when the Company has present legal or constructive obligations, as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amuont of the obligation.


Mar 31, 2010

1. Basis of Accounting

The Financial Statements are prepared on Accrual Basis under the Historic Cost Convention.

2.. Recognition of Income and Expenditure

Revenues / Incomes and Costs / Expenditure are generally accounted on Accrual Basis as they are earned or incurred.

Finance Charges in respect of Hire-Purchase transactions are apportioned over the period of the contract on the basis of internal rate of return method.

Lease income is accounted as per the terms of lease agreement entered into with the lessees from time to time in respect of leases entered prior to 31st March 2001. No lease agreements have been entered since 1st April 2001.

3. Fixed Assets

Fixed Assets are stated at cost, less accumulated depreciation.

4. Amortisation Policy

a) Leased Assets - Depreciation on all leased assets are provided over the primary lease period.

b) Assets held for own use - Depreciation on Assets held for own use is provided under Straight Line Method, at the rates prescribed by Schedule XIV of the Companies (Amendment), Act 1988.

5. Investments

Investments are stated at cost. Income from investments is included in the Profit and Loss Account. As the investments are long term in nature, fluctuation in its market value from time to time has not been considered.

6. Borrowing Costs

Interest and other costs incurred by the Company in connection with the borrowing of funds are recognized as an expense in the period in which they are actually incurred.

7. Lease Rentals

Lease Rentals are being accounted for on accrual basis.

8. Retirement Benefits

The Company has not provided for any retirement benefits to the employees. No Provision has been made for any liability for gratuity payable to the employees.

9. Impairment of Assets:

The carrying amounts of assets are reviewed at each balance sheet date to ascertain impairment based on internal / external factors. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is higher of the net selling price of the assets and their value in use.

10. Provisions:

Provisions are recognized when the company has present legal or constructive obligations, as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

11. Taxation:

Current Tax is provided on the taxable income for the year.

" Deferred tax liabilities arising from timing differences have been fully provided for. Deferred tax assets are recognized on the consideration of prudence.

 
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