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Accounting Policies of M B Parikh Finstocks Ltd. Company

Mar 31, 2015

1.01 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 specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act") / Companies Act, 1956 ("the 1956 Act"), as applicable. 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.

1.02 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.

1.03 Inventories

As the company is involved in trading and investing in shares, stocks, bonds and other funds, it does not carry stock in trade. Securities held for trading is considered as a current Investment.

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

Cash comprises cash on hand. Cash equivalents are balance in current accounts with bank(s) and demand deposits with banks (with an original maturity of three months or less).

1.05 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 of the Company are segregated based on the available information.

1.06 Depreciation and amortisation

Depreciation on Fixed Assets is provided on Written Down Value method at the rates prescribed in Schedule II to the Companies Act, 2013. Depreciation on additions to fixed assets and assets disposed off / discarded is charged on pro-rata basis. Assets costing less than ' 5,000 each are fully depreciated in the year of capitalisation.

1.07 Revenue recognition

a. Income from services

Brokerage income is recognised on the trade date of transaction upon confirmation of the transaction by recognised Stock Exchange and the client.

The Company has trading activities in Derivative segment in Shares and Commodities.

Derivative contracts are market-to-market and loss, if any, is recognised in the Statement of Profit and Loss as at the Balance Sheet date. Gains arising on the same are not recognised, until realised, on grounds of prudence.

b. Other income

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

1.08 Tangible fixed assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use, net of CENVAT (where claimed), excluding government grant, borrowing cost for qualifying assets.

1.09 Investments

Investments are classified as long term and Current based on their nature and intended holding period. 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. The diminution in value, if any, of investment in funds is taken as per the published annual audited results of relevant fund.

1.10 Employee benefits

As the number of employees of the company is below the prescribed limit for Registration under the Payment of Gratuity Act, 1972; Employees Provident Funds and Miscellaneous Provisions Act, 1952 or any other Act pertaining to employee benefits, the company has not provided for such employee benefits. Bonus is paid to employees as decided by the Management.

1.11 Segment reporting

Considering the nature of Company's business and operations, there is no reportable segment (business and / or geographical) in accordance with the requirement of Accounting Standard - 17 ‘Segment Reporting', prescribed under the Companies (Accounts) Rules, 2014.

1.12 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 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, by the number of equity shares considered for deriving basic earnings per share.

1.13 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. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisability. Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the Statement of Profit and Loss.

1.14 Provisions and contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes. Contingent Assets are not recognised in financial statements.

1.15 Derivative contracts

The Company has trading activities in Derivative segment in Shares and Commodities.

Derivative contracts are marked-to-market and losses are recognised in the Statement of Profit and Loss. Gains arising on the same are not recognised, until realised, on grounds of prudence.

1.16 Impairment of Assets

The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, except in case of revalued assets.

1.17 Service Tax Input Credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is reasonable certainty in availing / utilising the credits.

For the period of five years immediately preceding the date as which the Balance Sheet is prepared:

(A) No shares were allotted as fully paid-up pursuant to contracts without payment being received in cash.

(B) No shares were allotted as fully paid-up by way of bonus shares.

(C) No shares were bought back.


Mar 31, 2014

1.01 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006, (which continue to be applicable in respect of Section 133 ofthe Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

1.02 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.

1.03 Inventories

As the company is involved in trading and investing in shares, stocks, bonds and other funds, it does not carry stock in trade. Securities held for trading is considered as a current Investment.

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

Cash comprises cash on hand. Cash equivalents are balance in current accounts with bank(s) and demand deposits with banks (with an original maturity of three months or less).

1.05 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 of the Company are segregated based on the available information.

1.06 Depreciation and amortisation

Depreciation has been provided on the Written down Value Method as per the rates and manner prescribed in Schedule XIV to the Companies Act, 1956 .

Assets costing less than Rs. 5,000 each are fully depreciated in the year of capitalisation.

1.07 Revenue recognition

a. Income from services

Brokerage income is recognised on the trade date of transaction upon confirmation of the transaction by recognised Stock Exchange and the client.

The Company has trading activities in Derivative segment in Shares and Commodities.

Derivative contracts are marked-to-market and loss, if any, is recognised in the Statement of Profit and Loss as at the Balance Sheet date. Gains arising on the same are not recognised, until realised, on grounds of prudence.

b. Other income

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

1.08 Tangible fixed assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use, net of CENVAT (where claimed), excluding government grant, borrowing cost for qualifying assets.

1.09 Investments

Investments are classified as long term and Current based on their nature and intended holding period. 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. The diminution in value, if any, of investment in funds is taken as per the published annual audited results of relevant fund.

1.10 Employee benefits

As the number of employees of the company is below the prescribed limit for Registration under the Payment of Gratuity Act, 1972; Employees Provident Funds and Miscellaneous Provisions Act, 1952 or any other Act pertaining to employee benefits, the company has not provided for such employee benefits. Bonus is paid to employees as decided by the Management.

1.11 Segment reporting

Considering the nature of Company''s business and operations, there is no reportable segment (business and / or geographical) in accordance with the requirement of Accounting Standard - 17 ''Segment Reporting'', prescribed under Company (Accounting Standards) Rule, 2006.

1.12 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 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, by the number of equity shares considered for deriving basic earnings per share .

1.13 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. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisability. Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the Statement of Profit and Loss.

1.14 Provisions and contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes. Contingent Assets are not recognised in financial statements.

1.15 Derivative contracts

The Company has trading activities in Derivative segment in Shares and Commodities.

Derivative contracts are marked-to-market and losses are recognised in the Statement of Profit and Loss. Gains arising on the same are not recognised, until realised, on grounds of prudence.

1.16 Impairment of Assets

The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, except in case of revalued assets.

1.17 Service Tax Input Credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is reasonable certainty in availing / utilising the credits.


Mar 31, 2012

1.01 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared on accrual basis under the historical cost convention and 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 ol the Companies Act, 1956 and guidelines issued by SEBI. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

1.02 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 recognized in the periods in which the results are known / materialize.

1.03 Inventories

As the company is a finance company it does not carry stock in trade. Securities held for trading is considered as a current Investment.

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

Cash comprises cash on hand. Cash equivalents are balance in current accounts with bank(s) and demand deposits with banks (with an original maturity of twelve months or less from the reporting date ).

1.05 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 of 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.

1.06 Depreciation and amortization

Depreciation has been provided on the Written down Value Method as per the rates and manner prescribed in Schedule XIV to the Companies Act, 1956 .

Assets costing less than' 5,000 each are fully depreciated in the year of capitalization

1.07 Revenue recognition

a. Income from services

Revenues from Brokerage is recognized on the trade date of transaction upon confirmation of the transaction by recognized Stock Exchange and the client, when services are rendered and related costs are incurred.

The Company has trading activities in Derivative segment in Shares and Commodities. Derivative contracts are marked-to-market and losses are recognized in the Statement of Profit and Loss. Gains arising on the same are not recognized, until realized, on grounds of prudence.

b. Other income

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

1.08 Tangible fixed assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date.

1.09 Investments

Investments are classified as long term and Current based on their nature and intended holding period. 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.

1.10 Employee benefits

Employee benefits include salary, allowance and bonus.

1.11 Segment reporting

The Company doesn't have more than one reportable segment in terms of AS-17 "Segment Reporting".

1.12 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 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, by the number of equity shares considered for deriving basic earnings per share.

1.13 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 recognized 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 recognized on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal ii one or more subsequent periods. Deferred tax is measured using the tax rates and the tax law enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognize for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized only if there is virtual certainty that there will be sufficient future taxable income available to realize such assets. Deferred tax assets are recognized for timing differences of other items only to the extent that reasonable certainty exists the sufficient future taxable income will be available against which these can be realized. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their reliability.

Current and deferred tax relating to items directly recognized in equity are recognized in equity and not in the Statement of Profit and Loss.

1.14 Provisions and contingencies

A provision is recognized when the Company has a present obligation as a result of past' event; and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclose in the Notes.

1.15 Derivative contracts

The Company has trading activities in Derivative segment in Shares and Commodities.

Derivative contracts are marked-to-market and losses are recognized in the Statement of Profit and Loss. Gains arising on the same are not recognized, until realized, on grounds of prudence.


Mar 31, 2010

1. Preparation of Financial Statements:

The Financial statements are prepared under the historical cost convention on the accrual basis and in accordance with Generally Accepted Accounting Principles (GAAP). GAAP comprises mandatory accounting standards issued by the Institute of Chartered Accountants of India (ICAI), the provisions of the Companies Act, 1956 and guidelines issued by SEBI.

2. Use of Estimates:

The preparation of financial statements in conformity with the accounting standards requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are recognized in the period in which they materialize.

3. Revenue Recognition:

Brokerage income is recognized on the trade date of transaction upon confirmation of the transactions by stock exchanges and clients. Interest income is recognized on time proportion basis. Profit on sale of securities held as stock-in-trade is recorded on transfer of title as per guidelines of SEBI. Dividend is recognized on receipt basis.

4. Fixed Assets:

Fixed Assets are stated at cost less accumulated depreciation. Costs attributable to the asset till the date asset is ready to be put to use are added to the cost of asset.

5. Depreciation:

Depreciation on Fixed Assets is provided on "Written Down Value Method" on a pro-rata basis at the rates and in the manner specified in Schedule XIV of the companies Act, 1956.

6. Investments:

Investments are classified as long term or Current based on their nature and intended holding period. Long term Investments are stated at fair value cost less provision for diminution other than temporary in value.

7. Financial Instruments (i.e. Stock-in-Trade of) Quoted Equity Shares:-

The financial instruments being quoted equity shares, acquired with the intention of short term holding and trading position are considered as Stock-in-Trade, and shown undercurrent assets, are reported at Fair Value Through Profit or Loss (FVTPL) as per provisions of AS 30 - "Financial Instruments: Recognition and Measurement".

During the year, the company has adopted AS -30 "Financial Instruments: Recognition and Measurement" issued by the Institute of Chartered Accountants of India, which is made recommendatory w.e.f. 01.04.2009.

8. Taxes on Income:

Current Tax is determined on the taxable income for the year as per the provisions of the Income Tax Act, 1961.

Deferred tax expenses or benefit is recognized, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax liabilities are measured using the tax rate and tax law that have been enacted or subsequently enacted.

9. Provisions:

A provision is recognized when there is a present obligation as a result of past event i.e. it is probable that an outflow of resources will be required to settle the obligation and in respect of which reliable estimate can be made. Provision is not discounted to its present value and is determined based on the best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the best current estimate.

 
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