Mar 31, 2012
A. Basis of Preparation of Financial Statements
The accompanying financial statements are prepared in accordance with
Indian Generally Accepted Accounting Principles (GAAP) under historical
cost convention on accrual basis and comply with relevant statutory
enactments. Indian GAAP comprises mandatory accounting standards issued
by Institute of Chartered Accountants of India (ICA1) and the
provisions of the Companies Act, 1956. The Accounting policies have
been consistently applied by the Company.
Accounting Policies not specifically referred to, are in consistent
with generally accepted accounting practices and Accounting Standards
as specified in the Companies (accounting Standards) Rules, 2006.
b. Use of Estimates
The preparation of financial statements in conformity with Indian
General Accepted Accounting Principles (GAAP) requires management to
make estimates and assumptions that affect the report amounts of assets
liabilities, disclosures relating to contingent assets & the financial
statements and reported amount of income and expenses during the period.
Differences between the actual results and estimates arc recognized in
the period in which the results are known /materialized.
c. Revenue Recognition
* Revenue is recognized when it is earned and no significant
uncertainty exists as to its realization or collection.
* Interest and other dues are accounted on accrual basis.
d. Investment
Investments are classified into current and non - current investments.
Investments which are intended to be held for one year or more arc
classified as non - current investments and investments which are
intended to be held for less than one year are classified as current
investments. Non - current investments are accounted at cost and any
decline in the carrying value other than temporary in is provided for.
Current investments are valued at lower of cost or market value/fair
value.
e. Taxation
(i) Tax expense comprises of Current and Deferred, Current Income Tax
is measured at the amount expected to be paid to the tax authorities,
using the applicable tax rates and tax laws.
(ii) Deferred tax is recognized subject to consideration of prudence on
timing differences, being difference between taxable and accounting
income that originate in one period and are capable of reversal one or
more subsequent periods. Deferred Tax is measured based on the tax rates
and the tax laws enacted or substantially ma@ia:at the Balance Sheet
date. Deferred tax assets are recognize only to the extent there is
reasonable certainty that sufficient future taxable income will be
available against which these assets can be realized in future whereas
in case of existence of carry forward of losses or unabsorbed
depreciation , deferred tax assets are recognized only if there is
virtual certainty of realization backed by convincing evidence .
Deferred Tax assets are reviewed at each Balance Sheet date.
f. Provisions & Contingent Liabilities
Provisions are recognized when the Company has a present obligation as
a result of past events and it is more likely that an outflow of
resources will be required to settle the obligations and the amount has
been reliably estimated. Provision is not discounted to its present
value and is determined based on the best estimate required to settle
the obligation at the yearend date. These are reviewed at each year end
date and adjusted to reflect the best current estimate.
Liabilities, though contingent are provided for if there are reasonable
prospects of such liabilities maturing. Other contingent liabilities,
barring frivolous claims, not acknowledged as debt, are disclosed by
way of notes.
g. Change in accounting policy:
Presentation and disclosure of financial statements: During the year
ended 31 March 2012, the revised Schedule VI notified under the
Companies Act 1956, has become applicable to the company, for
preparation and presentation of its financial statements. The adoption
of revised Schedule VI docs not impact recognition and measurement
principles followed for preparation of financial statements. However,
it has significant impact on presentation and disclosures made in the
financial statements. The company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year.
h. Earnings per Share:
The Company reports basic and diluted earnings per share in accordance
with AS-20, 'Earnings per Share'. Earning per shares is computed by
dividing Net profit after tax by the weighted average number of equity
share outstanding at the end of the year.
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