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Accounting Policies of Morgan Ventures Ltd. Company

Mar 31, 2015

1. Corporate Information

Morgan Ventures Limited is a Public Limited company incorporated under the provisions of Companies Act, 1956. The Company is a Non - Banking Financial Company registered with Reserve Bank of India. Equity Shares of the Company is listed at Bombay Stock Exchange. The Company is also engaged in power generation from windmills.

A. GENERAL:

The accounts have been prepared under the historical cost convention as a going concern basis and are in accordance with applicable accounting standards. Revenue is recognized and expenses are accounted for on accrual basis.

B. USE OF ESTIMATES

The preparation of the financial statements requires estimates and assumptions to be made that affect the reporting amount of assets and liabilities on the date of financial statements and the reporting amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

C. FIXED ASSETS

Fixed Assets are valued at cost less accumulated depreciation.

D. DEPRECIATION

(i) PLANT & MACHINERY {OLD WIND MILL) : At written down value method at the rates as per technical report.

(ii) PLANT & MACHINERY (NEW WIND MILL): At Straight line method as per schedule II of Companies Act, 2013

(iii) OTHER FIXED ASSETS: At Straight line method as per schedule II of Companies Act, 2013

E. INVESTMENTS

All the Investments of the Company are Long term investment and the same are valued at cost.

F. PURCHASE OF PLANT

The Company had purchased five units of Jhalani Tools India Ltd. (in Liquidation) during Accounting year ended 30.06.2006 through Court Auction. The Company /management had no intention to run these units; therefore, these units were treated as a part of Stock in Trade in the financial statements with an intention to use them for trading purpose. At the end of Accounting period ended 31.03.2015, there is only one unit appearing as a part of Stock in trade in financial statements.

G. STOCK-IN-TRADE

Stock-in-Trade is valued lower of cost or net realizable value.

H. RECOGNITION OF INCOME

Revenue is recognized on accrual basis. Revenue on Sale of Electricity is recognized as per the Billing Cycle recommended by the TNEB for the particular Wind Farm.

I. TAXES ON INCOME

a) Provision for Income tax is made in accordance with the Income tax Act-1961.

b) Deferred Tax resulting from timing differences between the book and the tax profit is accounted for, at the current rate of tax, to the extent that the timing differences are expected to crystallize. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future; however - where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of such assets. Deferred tax liabilities are reviewed as at each balance sheet date.

J. IMPAIRMENT OF ASSETS

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. In the opinion of the management no provision for the impairment of the Fixed Assets of the company is required to be made during the year as per AS-28 issued by the ICAI on "Impairment of assets".

K. EMPLOYEE BENEFITS

The Company is providing benefits to employees in accordance with relevant applicable Statutes on the subject.

L. DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES There are no dues to Micro, Small and Medium Enterprises.

M. BORROWING COSTS

Borrowing Cost that is attributable to the acquisition or construction of qualifying assets is capitalized as part of the cost of such assets. A qualifying asset is one that takes necessary substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

N. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the Financial Statements.


Jun 30, 2014

A. GENERAL:

The accounts have been prepared under the historical cost convention as a going concern basis and are in accordance with applicable accounting standards. Revenue is recognized and expenses are accounted for on accrual basis.

B. USE OF ESTIMATES

The preparation of the financial statements requires estimates and assumptions to be made that affect the reporting amount of assets and liabilities on the date of financial statements and the reporting amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/material ized.

C. FIXED ASSETS

Fixed Assets are valued at cost less accumulated depreciation.

D. DEPRECIATION

(i) PLANT & MACHINERY (OLD WIND MILL) : At written down value method at the rates as per technical report.

(ii) PLANT & MACHINERY (NEW WIND MILL): At Straight line method as per rates prescribed in schedule XIV of Companies Act, 1956

(iii) OTHER FIXED ASSETS: On straight-line method at the rates prescribed under Schedule XIV of the Companies Act, 1956.

E. INVESTMENTS

All the Investments of the Company are Long term investment and the same are valued at cost.

F. PURCHASE OF PLANT

The Company had purchased five units of Jhalani Tools India Ltd. (in Liquidation) during Accounting year ended 30.06.2006 through Court Auction. The Company /management had no intention to run these units; therefore, these units were treated as a part of Stock in Trade in the financial statements with an intention to use them for trading purpose. At the end of Accounting year ended 30.06.2014, there is only one unit appearing as a part of Stock in trade in financial statements.

G. STOCK-IN-TRADE

Stock-in-Trade is valued lower of cost or net realizable value.

H. RECOGNITION OF INCOME

Revenue is recognized on accrual basis. Revenue on Sale of Electricity is recognized as per the Billing Cycle recommended by the TNEB for the particular Wind Farm.

I. TAXES ON INCOME

a) Provision for Income tax is made in accordance with the Income tax Act-1961.

b) Deferred Tax resulting from timing differences between the book and the tax profit is accounted for, at the current rate of tax, to the extent that the timing differences are expected to crystallize. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future; however where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of such assets. Deferred tax liabilities are reviewed as at each balance sheet date.

J. IMPAIRMENT OF ASSETS

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. In the opinion of the management no provision for the impairment of the Fixed Assets of the company is required to be made during the year as per AS-28 issued by the ICAI on "Impairment of assets".

K. EMPLOYEE BENEFITS

The Company is providing benefits to employees in accordance with relevant applicable Statutes on the subject.

L. DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES

There are no dues to Micro, Small and Medium Enterprises.

M. BORROWING COSTS

Borrowing Cost that Is attributable to the acquisition or construction of qualifying assets is capitalized as part of the cost of such assets. A qualifying asset is one that takes necessary substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

N. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the Financial Statements.

F. Contingent Liabilities:

The Company is in litigation relating to termination of Agreement to Sell with Goldendreams Buildcon Private Limited for sale of a plot at Aurangabad, part of 5 units of Jhalani Tools India Ltd acquired through Court Auction. The claim under dispute is for Specific Performance of agreement to sell and interest accrued. Golden dreams Buildcon Private Limited has also claimed compensation for alleged loss and damages suffered by them which has not been quantified by them. The Directors are of the opinion that the Company can protect its interest successfully. Contingent Assets are neither recognized nor disclosed in the Financial Statement.


Jun 30, 2013

A. GENERAL:

The accounts have been prepared under the historical cost convention as a going concern basis and are in accordance with applicable accounting standards. Revenue is recognized and expenses are accounted for on accrual basis.

B. USE OF ESTIMATES

The preparation of the financial statements requires estimates and assumptions to be made that affect the reporting amount of assets and liabilities on the date of financial statements and the reporting amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

C. FIXED ASSETS

Fixed Assets are valued at cost less accumulated depreciation.

D. DEPRECIATION

(i) PLANT & MACHINERY (OLD WIND MILL) : At written down value method at the rates as per technical report.

(ii) PLANT & MACHINERY (NEW WIND MILL): At Straight line method as per rates prescribed in schedule XIV of Companies Act, 1956.

(iii) OTHER FIXED ASSETS: On straight-line method at the rates prescribed under Schedule XIV of the Companies Act, 1956.

E. INVESTMENTS

All the Investments of the Company are Long term investment and the same are valued at cost.

F. PURCHASE OF PLANT

The Company had purchased five units of Jhalani Tools India Ltd. (in Liquidation) during Accounting year ended 30.06.2006 through Court Auction. The Company /management had no intention to run these units; therefore, these units were treated as a part of Stock in Trade in the financial statements with an intention to use them for trading purpose. At the end of Accounting year ended 30.06.2013, there is only one unit appearing as a part of Stock in trade in financial statements.

G. STOCK-IN-TRADE

Stock-in-Trade is valued lower of cost or net realizable value.

H. RECOGNITION OF INCOME

Revenue is recognized on accrual basis. Revenue on Sale of Electricity is recognized as per the Billing Cycle recommended by the TNEB for the particular Wind Farm.

I. TAXES ON INCOME

a) Provision for Income tax is made in accordance with the Income tax Act-1961.

b) Deferred Tax resulting from timing differences between the book and the tax profit is accounted for, at the current rate of tax, to the extent that the timing differences are expected to crystallize. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future; however where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of such assets. Deferred tax liabilities are reviewed as at each balance sheet date.

J. IMPAIRMENT OF ASSETS

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. In the opinion of the management no provision for the impairment of the Fixed Assets of the company is required to be made during the year as per AS- 28 issued by the ICAI on "Impairment of assets".

K. EMPLOYEE BENEFITS

The Company is providing benefits to employees in accordance with relevant applicable Statutes on the subject.

L. DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES

There are no dues to Micro, Small and Medium Enterprises.

M. BORROWING COSTS

Borrowing Cost that is attributable to the acquisition or construction of qualifying assets is capitalized as part of the cost of such assets. A qualifying asset is one that takes necessary substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

N. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the Financial Statements.


Jun 30, 2009

A. GENERAL:

The accounts have been prepared under the historical cost convention as a going concern basis and are in accordance with applicable accounting standards. Revenue is recognized and expenses are accounted for on accrual basis.

B. USE OF ESTIMATES

The preparation of the financial statements requires estimates and assumptions to be made that affect the reporting amount of assets and liabilities on the date of financial statements and the reporting amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.

C. FIXED ASSETS

Fixed Assets are valued at cost less accumulated depreciation.

D. DEPRECIATION

(i) PLANT & MACHINERY (OLD WIND MILL) : At written down value method at the rates as per technical report.

(ii) PLANT & MACHINERY (NEW WIND MILL): At Straight line method as per rates prescribed in schedule XIV of Companies Act, 1956

(iii) OTHER FIXED ASSETS: On straight-line method at the rates prescribed under schedule XIV of the Companies Act, 1956.

E INVESTMENTS

Investments are valued at cost.

F PURCHASE OF PLANT

The Company has purchased five units of Jhalani Tools India Ltd. during accounting year ended 30.06.2006 through court auction. Some of these units which are still lying with the company are appearing as a part of stock in trade in the financial statements as per the managements intention to hold them for trading purpose. The management has no intention to run these units at all.

G STOCK-IN-TRADE

Stock-in-Trade is valued lower of cost or net realizable value.

H PROFIT ON SALE OF INVESTMENTS

Profit on sale of Investments has been shown separately in the Profit & Loss Account as "Profit on sale of Investment".

I RECOGNITION OF INCOME

Revenue is recognized on accrual basis. Revenue on Sale of Electricity is recognized as per the Billing Cycle recommended by the TNEB for the particular Wind Farm.

J TAXES ON INCOME

a) Provision for Income tax is made in accordance with the Income tax Act-1961.

b) Deferred Tax resulting from timing differences between the book and the tax profit is accounted for, at the current rate of tax, to the extent that the timing differences are expected to crystallize. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future; how ever where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of such assets. Deferred tax liabilities are reviewed as at each balance sheet date.

K IMPAIRMENT OF ASSETS

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. In the opinion of the management no provision for the impairment of the Fixed Assets of the company is required to be made during the year as per AS-28 issued by the ICAI on "Impairment of assets".

L EMPLOYEE BENEFITS

Provisions of Gratuity and PF act are not applicable to the company as the No. of the employees on the Roll of the company are below threshold limit specified in the relevant statute.

M DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES

There are no dues to Micro, Small and Medium Enterprises.

N BORROWING COSTS

Borrowing Cost that is attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that takes necessary substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

O CONTINGENT LIABILITIES AND CONTINGENT ASSETS

There are no Contingent Liabilities, hence no disclosure made in the Notes. Contingent Assets are neither recognized nor disclosed in the Financial Statement.

P SECURED LOANS

Punjab National Bank (Large Corporate Branch) Delhi has first charge on all moveable and immoveable assets, as applicable, related to 25 Wind Mills known as Kanyakumari Wind Farm, Erode Wind Farm, Chennai Wind Farm and Coimbatore Wind Farm situated at Tamilnadu and first charge on all receivables/payment to be received from Tamil Nadu Electricity Board (TNEB) related to these Wind Mills as security for its outstanding Term Loan of Rs 717 Lacs (Previous Year Rs 852 Lacs).

 
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