Accounting Policies of Niyogin Fintech Ltd. Company

Mar 31, 2018

1. SIGNIFICANTACCOUNTING POLICIES

i. BASIS OF PREPARATION

The financial statements are prepared and presented in accordance with Indian Generally Accepted Accounting Principles (‘GAAP’) under the historical cost convention, on the accrual basis of accounting, unless otherwise stated, and comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013 (the ‘Act’), the provisions of Schedule III to the Act and circulars and guidelines issued by RBI for NBFCs. The financial statements are presented in Indian rupees and rounded off to nearest lac.

II. USE OF ESTIMATES

The preparation of the financial statements in conformity with the generally accepted accounting principles requires management to make judgments, estimates and assumptions that affect the application of accounting policies and reported amount of assets, liabilities, expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to the accounting estimates is recognised prospectively in current and future periods.

iii. CURRENT - NON-CURRENT

classification

All assets and liabilities are classified into current or non-current.

Assets - An asset is classified as current when it satisfies any of the following criteria:

a. It is expected to be realised in the Company’s normal cycle:

b. It is expected to be realised within 12 months after the reporting date: or

c. It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as non-current.

Liabilities - A liability is classified as current when it satisfies any of the following criteria:

a. It is expected to be settled in the Company’s normal cycle:

b. It is due to be settled within 12 months after the reporting date: or

c. The Company does not have any unconditional right to defer settlement of liability for at least 12 months after the reporting date.

Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current.

Operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle. Considering nature of the business, operating cycle cannot be determined, hence, the Company has adopted its operating cycle as 12 months for the purpose of current - non-current classification of assets and liabilities.

IV. PROPERTY, PLANT & EQUIPMENT, INTANGIBLE ASSETS, AND DEPRECIATION / AMORTISATION

a. Tangible assets

Tangible fixed assets are carried at cost of acquisition or construction less accumulated depreciation and / or accumulated impairment loss, if any. The cost of an item of tangible fixed asset comprises its purchase price, and other non-refundable taxes or levies and any directly attributable cost of bringing the asset to its working condition for its intended use. Subsequent expenditure is capitalised only when it increases the future economic benefits from the specific asset to which it relates. Tangible fixed assets under construction are disclosed as capital work-in-progress.

b. Intangible assets

Intangible assets that are acquired by the Company are measured initially at cost. After initial recognition, an intangible asset is carried at its cost less any accumulated amortisation and any accumulated impairment loss. Subsequent expenditure is capitalised only when it increases the future economic benefits from the specific asset to which it relates.

c. leasehold improvements

Leasehold improvement includes all expenditure incurred on the leasehold premises that have future economic benefits. Leasehold improvements are written off over the period of lease.

d. Intangibles assets under development

Eligible expenditure incurred for development of intangible assets is carried as intangible assets under development where such assets are not yet ready for their intended use.

e. capital work-in-progress

Projects under which tangible fixed assets are not yet ready for their intended use are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

f. depreciation and amortization

Depreciation / amoritisation is provided over the useful life of the assets, pro rata for the period of use, on a straight-line method. The useful life estimates prescribed in Part C of Schedule II to the Act have been considered as useful life for tangible assets. Intangible assets are amortised over a period as per management estimates of their useful life. Pursuant to this policy, the useful life estimates in respect of the following assets are as follows:

g. Impairment of assets

The Company assesses at the each balance sheet date whether there is any indication that an asset may be impaired based on internal/external factors. If any such indication exists, the Company estimates the recoverable amount of the asset. The recoverable amount is the greater of the net selling price and the value in use of those assets. Value in use is arrived at by discounting the estimated future cash flows to their present value based on an appropriate discount factor. If such recoverable amount of the asset or the recoverable amount of cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of the depreciable historical cost.

V. INVESTMENTS

Investments are classified into long term and current investments at the time of purchase of each investment.

Cost includes purchase cost, brokerage, stamp duty, etc. Discount received or premium paid on purchase of investments, as the case may be, is accreted or amortized, over the residual tenure of the security to give a constant yield to maturity.

Investments are recorded on a trade date and broken period interest is recognised in the balance sheet as interest accrued but not due.

a. Long term investments - Long term investments are investments intended to be held for a period of more than a year. Long term investments are carried individually at cost less provision for diminution, other than temporary, determined on an individual investment basis.

b. Current investments - Current investments are investments intended to be held for a period of less than a year. Current investments are stated at the lower of cost and fair value, determined on an individual investment basis.

Basis of valuation

In case of quoted debt instruments, where the quoted price is not available on the balance sheet date and unquoted debt instruments, fair value is determined based on quotes / market value provided by market intermediaries.

For investments in the schemes of mutual funds, Net Asset value ‘(NAV’) is considered as provided by the fund house.

Commercial papers are valued at carrying cost as per the requirements of RBI prudential norms.

VI. REVENUE RECOGNITION

a. Interest income - Interest income is recognised as it accrues on a time proportion basis taking into account the amount of principal outstanding and the interest rate applicable, except in the case of non-performing assets (‘NPAs’) where it is recognised upon realisation as per RBI Guidelines.

b. Processing fees - Processing fee is recognized upfront, when the amount becomes due.

c. Other finance charges - Cheque bounce charges, overdue interest, foreclosure fees, service charges, finance charges etc. are recognized provided it is not unreasonable to expect ultimate collection.

d. Gain / loss on sale of investments - Profit or loss on sale of investments is recognised on a trade date and determined on the basis of First-In-First-Out (FIFO).

VII. EMPLOYEE BENEFITS

a. Contribution to provident fund – The Company makes specified monthly contributions towards employee provident fund to government administered provident fund scheme which is a defined contribution plan. The Company’s contribution is recognized as an expense in the statement of profit and loss during the period in which the employee renders the related services.

b. Gratuity - The Company provides for the gratuity, which is a defined benefit plan. The plan provides for lumpsum payments to employees upon death while in employment or on separation from employment after serving for the stipulated period mentioned under ‘The Payment of Gratuity Act, 1972’. The Company accounts for liability of future gratuity benefits based on an external actuarial valuation on projected unit credit method carried out for assessing liability as at the reporting date. Actuarial gains / losses are immediately taken to the statement of profit and loss and are not deferred.

VIII. ACCOUNTING FOR LEASES

Leases where the lessor effectively retains substantially all the risks and benefits of ownership over the lease term are classified as operating leases. Operating lease rentals are recognized as an expense on a straight-line basis over the lease period.

IX. FOREIGN EXCHANGE TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rate prevailing on the dates of transaction. Monetary assets and liabilities denominated in foreign currency, remaining unsettled at the balance sheet date are restated at the closing exchange rates. Gain / loss arising on actual payments / realisations and year-end restatements are recognized in the statement of profit and loss.

X. PROVISIONS FOR NPAS AND DOUBTFUL DEBTS

NPAs including loans and advances are identified as sub-standard / doubtful / loss based on the tenor of default. NPA provisions are made based on management’s assessment of the degree of impairment and the level of provisioning and meets prudential norms for asset classification prescribed by RBI for Non Deposit Taking Non Systemically Important NBFCs. These provisioning norms are considered the minimum and additional provision is made based on perceived credit risk where necessary.

All contracts which as per management are not likely to be recovered are considered as loss assets and written-off as bad debts. Recoveries made from previously written off contracts are included in ‘Other Income’.

A general provision has been made on standard assets as prescribed by RBI for Non Deposit Taking Non Systemically Important NBFCs.

XI. OTHER PROVISIONS AND CONTINGENT LIABILITIES

The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

Provisions are reviewed at the balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognized in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognized in the period in which the change occurs.

XII. CASH AND CASH EQUIVALENT

Cash and cash equivalents for the purpose of cash flow statement comprise cash at bank and cash in hand and short term balances with original maturity of three months or less from the date of acquisition, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

XIII. TAXATION

Income-tax expense comprises current tax (i.e. amount of tax for the period determined in accordance with the income-tax law) and deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the period).

Current taxes

Provision for current income-tax is recognized in accordance with the provisions of Indian Income-tax Act, 1961 and is made annually based on the tax liability after taking credit for tax allowances and exemptions.

Deferred taxes

Deferred tax is recognised in respect of timing differences between taxable income and accounting income i.e. differences that originate in one period and are capable of reversal in one or more subsequent periods. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future: however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realised. Deferred tax assets are reviewed as at the each balance sheet date and written down or written-up to reflect the amount that is reasonably / virtually certain (as the case may be) to be realised.

XIV.SHARE ISSUE EXPENSES

Share issue expenses are adjusted against the Securities Premium Account as permissible under Section 52 of the Act to the extent any balance is available for utilisation in the Securities Premium Account. Share issue expenses in excess of the balance in the Securities Premium Account are expensed in the statement of profit and loss.

XV. EARNINGS PER SHARE

The basic earnings per share (‘EPS’) is computed by dividing the net profit attributable to the equity shareholders by the weighted average number of equity shares outstanding during the reporting year.

Number of equity shares used in computing diluted EPS comprises the weighted average number of shares considered for deriving basic earnings per share and also weighted average number of equity shares, which would have been issued on the conversion of all dilutive potential shares. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year except where the results would be anti-dilutive.

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Mar 31, 2014

(a) Basis of Accounting

The financial statements have been prepared under the historical cost convention and on accrual basis of accounting and in accordance with applicable Accounting Standards and relevant presentational requirement of the Companies Act, 1956.

(b) Recognition of Income

(i) Sales of Shares & Securities

Sale of Shares are recognized as per contract note.

Rent Income is recognized as per contract between the parties.

(iii) Other income

(a) Other income is recognised on accrual basis except when realization of such Income is uncertain.

(b) The prudential norms for income recognition and provisioning in respect of Loans and Advances. have been made as per RBI norms for Non-Banking Financial Companies.

(c) Fixed Assets

(ii) These costs exclude Mod vat / Service tax credit if availed, but include The borrowing cost up to the date commercial production, wherever applicable.

(iii) As required by AS 28 on impai rment of Assets issued by ICAI, the Company has Carried out as exercise of identifying the assets that may have been impaired. There were no impaired assets during the year mainly on account of economic performance and alternative viability of such assets.

(d) Depreciation

(i) Depreciation has been provided on W ritten Down Val ue Method basis on all assets at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 and New Schedule II as per Companies Act, 2013.

(e) Investments

Investments are long-term investments and are stated at the cost of their acquisition. Long term investments are stated at cost less provisions, if any, for decline other Than temporary in their value.

Inventories are valued at lower of cost and net realizable value.

(g) Retirement Benefits (i) Gratuity

Gratuity is provided on the basis of actual valuation

(ii) Leave Encashment

The benefit of encashment of leave is given to the employees of the company during Their service and on retirement. The accumulated leave liability as at the end of the Year is provided for on actual valuation.

The provision for taxation is ascertained on the basis of assessable profits computed in accordance with the provisions of the Income-tax 1961.

Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the differences between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent Periods.

*Deferred Tax assets are recognized only if there is a reasonable or virtual certainty That they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

Provisions and Contingent (I) Liability:

The Company creates a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate Can be made of the amount of the obligation.

A disclosure for a contingent liability is made when there is a possible obligation Or a present obligation that may, but probably will not require an outflow of resources When there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

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Mar 31, 2013

Not Available.

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Mar 31, 2011

I Basis of Accounting - The Financial Statements are Prepared on Accrual Basis under the Historic Cost Convention and are in accordance with the requirements of the Companies Act 1956.

a) Interest on loans is accounted on annual basis and as per the terms and conditions and wherever receivable.

b) Dividend Income is accounted on receipt basis.

ii. Stock in Trade - The Securities held as stock in trade under current asset are valued at cost or fair value whichever is lower

iii. All expenses are accounted for on accrual basis.