Home  »  Company  »  Looks Health Service  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Looks Health Services Ltd. Company

Mar 31, 2014

1. Basis of Preparation of Financial Statements

The Financial Statements have been prepared un- der Historical Cost conventions and on accrual ba- sis in accordance with the Generally Accepted Ac- counting Principles (''GAAP'') applicable in India, Companies (Accounting Standard) Rules, 2006 no- tified by Ministry of Company Affairs and Account- ing Standards issued by the Institute of Chartered Accountants of India as applicable and relevant pro- visions of the Companies Act, 1956, as adopted con- sistently by the Company.

2. Use of Estimates

The preparation of Financial Statements in confor- mity with Indian GAAP requires estimates and as- sumptions to be made, that affects the reported amounts of assets and liabilities on the date of the Financial Statements and the reported amounts of revenue and expenses during the reporting period. Differences between the actual results and esti- mates are recognized in the period in which the re- sults are known / materialized.

3. Fixed Assets

Fixed Assets are capitalized at cost less accumu- lated depreciation inclusive of purchase price, du- ties and other non refundable taxes, direct attribut- able cost of bringing asset to its working condition and financing cost till commercial production, if any.

Projects, if any, under which assets are not ready for their intended use are shown as Capital Work- in-Progress. However no project was undertaken during the year under review.

4. Depreciation / Amortization

Depreciation on fixed assets is provided on Written Down Value (WDV) at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

5. Inventories

The inventories are stated at lower of cost and net realizable value, after providing for obsolescence, if any. Cost of Inventories comprises of all cost of purchase, cost of conversion and other cost incurred in bringing inventory to the present location and con- dition and valuation is inclusive of taxes and duties incurred on same.

6. Revenue Recognition

Revenue from sales transactions is recognized on transfer of significant risk and rewards of ownership, which generally is on the dispatch of goods. Rev- enue from services are recognized upon rendering of services & in case of sittings on the basis of completion of each sitting. Interest Income is recog- nized on accrual basis.

7. Investment

Investments are classified as Current & Non Cur- rent Investments. Current Investments are carried at lower of cost or Market / Fair Value determined on an individual investment basis. Non-Current in- vestments are valued at cost. However no Invest- ment was made by the Company during the year.

8. Borrowing Costs

Borrowing costs that are attributable to the acquisi- tion or construction of qualifying assets are capital- ized as part of the cost of such assets. A qualifying asset is one that takes necessarily substantial pe- riod of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss A/c.

9. Taxation

Tax expenses for the year comprise of current tax and deferred tax. Current tax is measured as amount of tax payable in respect of taxable income for cur- rent year as per Income Tax Act 1961 after consid- ering tax allowances and exemptions, if any. De- ferred Tax assets or liabilities are recognized for fur- ther tax consequence attributable to timing differ- ence between taxable income and accounting in- come that originate in one year and are capable of reversal in one or more subsequent year.

In view of higher depreciation benefit under Income Tax Act no taxable income arise and hence no pro- vision is made for Current Years Income Tax. Deffered Tax liability is created on account of timing difference on Depreciation as per Companies Act and Income Tax Act.

10. Leases Operating Lease

Lease where the lesser effectively retains substan- tially all risks and benefits of the asset are classified as Operating lease. Operating lease payments are recognized as an expense in the Profit & Loss ac- count.

11. Impairment of Assets

An asset is impaired when the carrying cost of as- sets exceeds its recoverable value. An impairment loss is charged to Profit & Loss in the year in which an asset is identified as Impaired. As on Balance Sheet date, the Company reviews the carrying amount of Fixed Assets to determine whether there are any indications that those assets have suffered "Impairment Loss".

12. Foreign Exchange Transactions

i) Transactions in Foreign currency are recorded at the rate of exchange prevailing on the date of the respective transactions or that approximates the actual rate at the date of the transaction.

ii) Monetary items denominated in foreign curren- cies at the yearend are restated at year end rates. In case of items which are covered by forward ex- change contracts, the difference between the yearend rate and rate on the date of the contract is recognized as exchange difference and the pre- mium paid on forward contracts is recognized over the life of the contract.

iii) Non-monetary foreign currency items are car- ried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss, ex- cept in case of long term liabilities, where they re- late to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets

13. Earnings per Share

In determining the Earnings Per share, the com- pany considers the net profit after tax which includes any post tax effect of any extraordinary / exceptional item. The number of shares used in computing ba- sic earnings per share is the weighted average num- ber of shares outstanding during the period.

The number of shares used in computing Diluted earnings per share comprises the weighted aver- age number of shares considered for computing Basic Earnings per share and also the weighted number of equity shares that would have been is- sued on conversion of all potentially dilutive shares.

14. Retirement Benefits

No provision is made for gratuity as according to management, no employees have crossed the minimum length of service in the organization required for making gratuity payments.

15. Contingent Liabilities & Provisions

Provisions are recognized only when there is a present obligation as a result of past events and when a reliable estimate of the amount of obligation can be made.

Contingent Liability is disclosed for by way of note for -

a) Possible obligation which will be confirmed only by future events not wholly within the control of the Company or

b) Present obligations arising from the past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

c) Contingent Assets are not recognized in the fi- nancial statements since this may result in the rec- ognition of income that may never be realized.

Mar 31, 2013

1. Basis of accounting:

The financial statements are prepared on the historical cost convention basis and on accrual concept as a going concern in accordance with the applicable Accounting Standards referred to in Sub section 3C of Section 211 of the Companies Act, 1956 and normally accepted accounting principles.

2. Accounting Standards:

Accounting standards as prescribed by the Department of Corporate Affairs (Formerly known as Department of Company Affairs) and referred to in the Companies Act, 1956 have been followed wherever applicable.

3. Fixed Assets and its Depreciation:

Fixed assets are stated at cost price comprising of the purchase price and any attributable cost of bringing the assets to its working condition for its intended use.

Depreciation is calculated under WDV method at the rates prescribed under amended schedule XIV of the Companies Act, 1956 and on pro-rata basis.

4. Investments:

Company has not made any investments during the year under review.

5. Inventories:

Stock of Medicines are valued at Cost or realizable value whichever is less.

6. Contingent Liabilities:

No litigations are filed or pending against the Company & Company does not have any present obligation arising out of any past event. Hence no provision arises or is made for contingent liabilities.

7. Revenue Recognition:

Company is rendering professional services of cosmetic & other surgeries & skin and hair care services & most of these services run into no. of sittings. Hence revenue generation is recognized sitting-wise after completion of client sitting. In case of sale of medicines revenue is recognized on transfer of goods to the buyer. All expenses to the extent considered payable respectively unless specifically stated to be otherwise are accounted for on mercantile basis.

8. Retirement Benefits:

Company has not applied under Provident Fund & Miscellaneous Provisions Act & hence no provision is made towards retirement benefits of Employees.

9. Operating Lease -

The company has obtained all premises for its business operations (including furniture and fittings at Bandra) under operating lease or leave and license agreements. These are generally not non-cancellable and range between 11 months to 5 years under leave and license, or longer for other lease and are renewable by mutual consent on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

Total Lease payments of Rs.58,26,001/- are recognized in the Profit and Loss Account under the head "Rent Paid".

10. Foreign Currency Transactions:

Foreign currency transactions made for purchase of imported medical equipments are recorded at the prevailing exchange rates or rates that closely approximate the prevailing exchange rates at the time of initial recognition (date of transaction). Exchange differences arising on final settlement is adjusted to the cost of Medical Equip- ments. Further as on year end there is no outstanding balances of monetary items denominated in foreign currency. Foreign exchange Outgo - Company has made payment of US$ 1670/- to suppliers from whom Company has procured medical equipments.

11. Borrowing Cost:

Company has taken loans, temporary, if any, from its members but according to management & from records it appears same are temporary loans and hence according to management interest is not payable to them and hence is not provided for.

12. Taxation :

In view of carried forward loss of earlier year, no provision for current tax is made under the provisions of the Income Tax act, 1961. Deferred tax Liability of Rs. 67577''/- resulting from timing differences between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable / Virtual certainty that the asset will be realized in future.

13. Segmental Reporting: .

The Company is operating only in one segment i.e. Cosmetic Surgeries & Skin, Hair, Dental & other Health Care Services.

14. Related Party Transactions:

As per accounting standard 18 (AS-18) Related party disclosures, notified in the companies (Accounting Stan- dards) Rules 2006, the disclosure of transactions with the related parties defined in AS-18 are given below;

1. Key Managerial Personnel:

a) Dr. Prashant Vikram

b) Dr. Nishita Sheth

c) Mr. Pritesh Doshi

Further following Related Party Transactions were noticed during the year:

a) Bandra Clinic premises owned by Dr. Nishita Sheth - M.D. has been taken on Leave and Licence basis by the Company w.e.f26/12/2011. Monthly rent is Rs. 100000/-. (Advance deposit of Rs. 10 lacs made by the Company to her).

b) Furniture at Bandra Clinic owned by Dr. Prashant Vikram - Chairman has been taken on Leave and Licence basis by the Company w.e.f.26/12/2011 on monthly rent of Rs.75,000/-.(Advance deposit of Rs.5 lacs made by the Company to him).

c) Company has advanced a total sum of Rs.10,35,407/- to various parties for Furniture (Bandra Office) on behalf of Dr. Prashant Vikram to be recovered from him & as on 31/03/2013 at sumofRs.485407/- is due from him.

15. Earnings (Loss) Per Share:

Basic EPS - (0.07) = 438258 (Net Profit attributable to Shareholders) / 6000000 (Weighted Avg. No of Equity Shares)

Diluted EPS - (0.07) = 438258 (Net Profit attributable to Shareholders) / 6000000 (Weighted Avg. No of Equity Shares) -

Diluted EPS is similar to Basic EPS as there are no potential equity share as on date.

16. Miscellaneous Expenditure

Preliminary Expenses incurred by Company is written off during the year in view of AS26 (Para 56). Further management has decided not to write off Public Issue Expenses during the year of Issue and to write off the same over a period of 5 years.

Oct 21, 12:00 am
Oct 21, 4:14 pm
Subscribe now to get personal finance updates in your inbox!