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National Buildings Construction Corporation Ltd. Accounting Policies | Accounting Policy of National Buildings Construction Corporation Ltd.
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Accounting Policies of National Buildings Construction Corporation Ltd. Company

Mar 31, 2015

(a) Corporate Information

National Buildings Construction Corporation Limited (NBCC/the company) was incorporated in I960 under the Companies Act, 1956. NBCC is a Public Sector Enterprise under the administrative control of Ministry of Urban Development, Government of India. NBCC is primarily engaged in the business of (i) Project Management Consultancy (PMC) (ii) Real Estate Development and (iii) Engineering, Procurement and Construction (EPC). The equity shares of NBCC are listed on National Stock Exchange of India Limited and BSE Limited.

(b) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared to comply in all material respects with the notified Accounting Standards by Companies Accounting Standards Rules, 2006 as amended from time to time (notified under Section 211(3C) of the Companies Act, 1956 which continues to be applicable in terms of Companies (Accounts) Rules, 2014 in respect of Section 133 of the Companies Act, 2013) and other relevant provisions of the Companies Act, 2013. Financial Statements have been prepared under historical cost convention on accrual basis in accordance with Generally Accepted Accounting Principles (GAAP) in India. The accounting policies have been consistently followed by Company.

(c) USE OF ESTIMATES

Financial Statements are prepared in accordance with GAAP in India which require management to make estimates and assumptions that affect the reported balances of assets, liabilities and disclosure of contingent liabilities at the date of the financial statements and reported amounts of income & expenses during the periods. Although these estimates and assumptions used in accompanying financial statements are based upon management''s evaluation of relevant facts and circumstances as of date of financial statements which in management''s opinion are prudent and reasonable, actual results may differ from estimates and assumptions used in preparing accompanying financial statements. Any revision to accounting estimates is recognized prospectively from the period in which results are known/ materialize in accordance with applicable Accounting Standards.

2. INCOME RECOGNITION

(a) In case of PMC contracts which are in nature of Cost Plus Contracts, revenue is recognised on the basis of percentage completion method. The stage of completion is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs.

(b) In respect of Real Estate Development, the company is following Revised Guidance Note, GN (A) 23 (revised 2012) on "Accounting for Real Estate Transactions" issued by The Institute of Chartered Accountants of India. Revenue from Real Estate projects is recognized on "Percentage of completion Method" (POC) of accounting. Revenue under POC method is recognized on basis of percentage of actual costs incurred including construction and development cost of projects under execution and proportionate cost of land provided following conditions have been fulfilled:

i. atleast 25% of estimated construction and development costs (excluding land cost) has been incurred;

ii. atleast 25% of saleable project area is secured by the Agreements to Sell/ Application Forms (containing salient terms of the agreement to sell); and

iii. atleast 10% of total revenue as per Agreement to Sell are realized in respect of these agreements.

(c) In case of EPC Contracts, the revenue is recognised on the basis of percentage completion method. The stage of completion is determined by the proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total contract costs.

(d) Revenue includes:

(i) Work done for which only letters of intent have been received, however, formal contracts / agreements are in the process of execution.

(ii) Work executed and measured by the Company pending certification by the client.

(iii) Work executed but not measured / partly executed are accounted for at engineering estimated cost.

(iv) Extra and substituted items to the extent considered realizable.

(v) Claims lodged against clients to the extent considered realizable.

(vi) Amount retained by the clients which is released after the commissioning of the project.

(e) Income from interest is accounted for on time proportion basis taking into account amount outstanding and applicable rate of interest. Interest from customers under agreement to sell is accounted for on receipt basis.

(f) Dividend income is recognised when right to receive is established.

(g) Rent, Service Receipts are accounted for on accrual basis.

3. WORK-IN-PROGRESS

Work-in-progress includes unsold portion of Real Estate Projects. Increase / decrease in Work-in-Progress is accounted for as income or expenditure for the year, as the case may be. Valuation of work-in-progress including unsold portion of reality project is being done on basis of actual cost and overheads incurred which are directly attributable to project, till completion.

4. FIXED ASSETS Tangible Assets:

Fixed Assets are stated at historical cost less accumulated depreciation and impairment loss, if any Cost comprises purchase price, duties, levies and any directly attributable cost of bringing the assets to their working condition for its intended use. It excludes refundable taxes. Borrowing costs, if any relating to acquisition of fixed assets which take substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Intangible Assets:

Intangible Assets are stated at their cost of acquisition less accumulated amortisation.

5. DEPRECIATION & AMORTISATION

a) Depreciation on Fixed Assets is calculated on Straight line method in accordance with the provisions of Schedule II of the Companies Act, 2013 keeping 5% of cost as residual value. The useful life of fixed assets as defined in the Part C of Schedule II of the Companies Act, 2013 has been taken for all tangible assets.

b) Fixed Assets costing upto Rs. 10,000/- each are fully depreciated in the year of its acquisition.

6. FOREIGN CURRENCY TRANSACTIONS

The financial statement of an integral operation is translated using following principles and procedures:

a. A foreign currency transaction is recorded, on initial recognition in reporting currency (i.e. Rs.), by applying to foreign currency exchange rate at the date of transaction.

b. Monetary items denominated in a foreign currency are reported using exchange rate at reporting date.

c. Non-monetary items carried in term of historical cost denominated in foreign currency, are reported using exchange rate at the date of transaction.

d. Exchange differences arising on the settlement of monetary items or on reporting an enterprise''s monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements, are recognized as income or as expenses in the period in which they arise.

e. Exchange differences arising on reporting of long term monetary assets at rates different from those at which they were initially reported during the period or previous periods in so far they relate to the acquisition of depreciable capital asset is added to or deducted from the cost of assets.

f. Non monetary foreign currency items are carried at cost.

7. VALUATION OF INVENTORIES

a) Direct Materials, Stores and Spare Parts are valued at lower of cost or net realizable value. Cost is determined on weighted average cost method.

b) Consumables including Cantering, Shuttering and Scaffolding, Loose TooIs, Laboratory Equipment, empty containers & others are valued on the basis of realizable value, based on the engineering estimate.

8. INVESTMENTS

* Current Investments are valued at Lower of Cost or Net Realizable Value.

* Long Term Investment are stated at cost. Provision for diminution in the value of long term investments is made only if, such decline is other than temporary in the opinion of the management.

9. EMPLOYEE BENEFITS

a) SHORT TERM BENEFITS

These are recognised as an expense at the undiscounted amount in the statement of profit and loss for the year in which the related services are rendered. These benefits include performance related pay and compensated absences.

b) LONG TERM BENEFITS

Defined Contribution Plan

Company''s contribution paid/payable during the year to Provident Fund, EPS 1995 of EPFO and Company''s Pension Scheme is recognised in the statement of profit and loss for the year in which the related services are rendered. The same is paid to a fund administered through separate trusts.

Defined Benefit Plan

Company''s liability towards gratuity, leave benefits (including compensated absences) and TA on Superannuation are determined by independent actuary, at the year end using the projected unit credit method. Actuarial gains or losses are recognised immediately in the statement of profit and loss. Liability for gratuity as per actuarial valuation is paid to a fund administered through a separate trust.

c. EMPLOYEE SEPERATION COSTS

Ex Gratia to employees who have opted for retirement under the voluntary retirement scheme of the Company is charged to the Statement of Profit and Loss in the year of acceptance of option by the management.

10. PRIOR PERIOD EXPENDITURE / INCOME

Expenditure / Income upto Rs. 1,00,000 in each case relating to prior period has been charged / accounted for to the respective head of accounts.

11. TAXES ON INCOME

Tax expense comprises both current and deferred tax. Current tax is determined on the basis of taxable income in accordance with the provisions of the Income Tax Act, 1961. Deferred tax liability /asset resulting from ''timing difference'' between accounting income and taxable income, that is capable of reversal in subsequent accounting period is accounted for considering the tax rate & tax laws that have been enacted or substantively enacted as on the reporting date. Deferred tax asset is recognized and carried forward only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Deferred tax assets are reviewed at each reporting date for their realisability.

12. IMPAIRMENT OF ASSETS

Carrying amount of cash generating units is reviewed at each reporting date where there is any indication of impairment based on internal/ external indicators. An impairment loss is recognised in the statement of profit and loss where carrying amount exceeds recoverable amount of cash generating units. Impairment loss is reversed, if, there is change in recoverable amount and such loss either no longer exists or has decreased or indication on which impairment was recognised no longer exists.

13. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

A provision is recognised when the company has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle obligation and in respect of which a reliable estimate can be made. Provisions are determined based on management estimate required to settle the obligation on reporting date.

Contingent liabilities are disclosed on basis of judgment of management after a careful evaluation of facts and legal aspects of matter involved.

Contingent assets are neither recognized nor disclosed. However, when realization of income is virtually certain, related asset is recognized.

14. PROVISION FOR DOUBTFUL DEBTS / LOANS AND ADVANCES

The amount of Trade Receivables / Loans and Advances in closed projects, pertaining to Government of India, its departments and Public Sector Enterprises are considered Good for realisation irrespective of the age of receivable / loans and advances. These debts are under constant persuasion for realisation till final settlement made with client or in case of dispute, verdict is passed by the arbitrator / court. Necessary provision against doubtful debts / loans and advances is made based on the previous experience of Management. Receivables / Advances are written-off as and when considered unrealisable.

15. UNADJUSTED CREDIT BALANCES WRITTEN BACK

Write back of unsettled credit balances is done on closure of the concerned project or earlier based on the previous experience of Management and actual facts of each case.

16. ARBITRATION AWARDS

Arbitration / Court''s awards, to the extent not taken into accounts at the time of initiation, are accounted for after it becomes decree. Interest to / from in these cases are accounted for on actual payment /receipt basis.

17. LIQUIDATED DAMAGES

Liquidated Damages / Compensation for delay in respect of clients/ contractors, if any, are accounted for when matter is considered settled by management.


Mar 31, 2013

1. (a) BASIS OF PREPARATION Of FINANCIAL STATEMENTS

These financial statement are prepared in accordance with Indian Generally accepted accounting principles (GAAP) under the historical cost convention and the accrual basis GAAP comprises mandatory according as standard as prescribed by the companies according standards) Rules 2005 as amended issued by the Central Government the provisions of companies ACt,1956 guidelines issued by the securities and Exchange Board of India (SEBI) and ICAI The according policies have been consistently followed by the company.

(b) USE OF ESTIMATES

The financial statements are prepared in according with generally accepted accounting (GAAP) in India which requires management to make estimates and assumptions that affect the reported balances of assets liability and disclosure of contingent liability as at the date of the financial statement and reported amounts of income & expenses during the periods. The estimates and assumptions used in the accompanying financial statements are based upon management evaluation of the relevant facts and circumstances as of the date of the financial statements which in managements opinion are prudent and reasonable Actual results may differ from the east mates and assumptions used in preparing the accompanying financial statements Any revision to accounting estimates is recognized prospectively in current future periods.

2. INCOME RECOGNIOTION

(a) Value of work done is being shown in the accounts based on percentage completion method such an evaluation of work done is based on the previous experience of the Management.

(b) Value of work done and constituent for which only letters of intent have been received however formal contracts agreements are in the process of execution.

(i) Work done for the constituent for which only letters of intent have been received however formal contracts/agreements are in the process of execution.

(ii) Work executed and measured by the company pending certified by the constituent.

(iii) Work executed but not measured party executed accounted for at engineering estimated cost.

(iv) Extra and substituted items to the extent consider realized based on the previous experiences of the Management.

v) Claims referred to arbitration or lodged against constituent to the extent considered realizable based on the previous experience of the Management

vi) Amount retained by the constituent which is released after the coming of the project.

(c) Company is following the revised guidance note GN(A) 23 (revised2012) on accounting for real estate transfer Revenue from real estate projects is recognized on the percentage of compliances method (POC) of accounting Revenue under POC method is execution and proportionate cost of land subject to such actual cost incurred.

Total sale consideration as per the duty executed agreements to sell application forms corporate salient terms of a agreement to sell) is recognized as rev endue based on the percentage of actual project cost of land and at least 25% or more area of total salable area is secured by agreements to sell application forms containing salient terms of agreement to sell of which at least 10% amount of the total revenue is received.

4. FIXEDASSETS

Fixed Assets are stated at historical cost less accumulated depreciation and impair mane loss if any cost directly attributable to acquisition of fixed assets are capitalized. Fixed essay sure capsule

5. DEPRECIATION & AMORTISATION

a) Depreciation on fixed assets is calculated on straight line Method in according with the provisions of schedule XIV to the companies Act,1956 after keeping 5% residual value of Assets.

b) Fixed Assets costing up to Rs,5000/- each are depreciated fully in the year of its creation.

c) Temporary hutments and installation are depreciated fully in the year of its question.

d) Hostel staff campus equipments are considered as temporary Assets and the depreciation thereon is ascertained by deducting the realizable value as estimated by the management from the book value.

T. VALUATION OF INVENTORIES

a) Valuation of Direct Metrical stores & spore parts steel scrap tools & Equipments act are done at lower at cost or net realizable value

b) Consumables including centering shuttering and scaffolding loose laboratory Equipment empty containers & others is ascertained on the basis of realizable value at the end of every period.

g. INVESTMENTS

Current investments are valued at lower of original cost or net Realizable value.

9. EMPLOYEE BENEFITS

A) Short term employs benefits are recognized as an expense in the statement of profit 7 loss for the year in which the related services are rendered.

II) LONG TERM BENEFITS

a) Gratuity

The PROVISION FOR GRATUITY IS MADE IN THE ACCOUNTS IN According with the provisions of the payment of Gratuity Act, on actuarial basis

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

c) Travelling Allowance on Superannuation

The provision for travelling allowance on suppuration is made on actuarial basis.

d) Pension

The provision for pension on superannuation is made on actual basis

19. PEFERRED REVENUE ESPEHDITUHE

Expenditure incurred for acquiring Technical knowhow is treated as Deferred Revenue Expenditure and charged to profit & loss Account in equal yearly instilments over a period of six years or estimated life of the know-how whichever is less.

11. CONSUMPTION OF MATERIAL AT SITE

The consumption of material at site is net of recovery/sale from/ to PRW Others and inter unit transfer shortage of materials on account of theft pirate etc. if any is booked separately under the appropriate discrepancy head.

12. PRIOR PERIODEXPENDITURE- INCOME

Expenditure/income up to Rs,50000/- In each relating to prior has been charged for to the respective head of accounts.

13. TAXES ON INCOME

Income Tax is accounted for in accordance with Accounting Standard -22''Accounting for taxes on income issued by ICAI which includes current Taxes and Deferred Taxes

Deferred taxis recognized on timing differences being the different taxable income and Accounting income that originate in one period and capable of reversing in one more subsequent period

14. IMPAIRMENT OF ASSETS

The company identified impair able assets on individual asset ct the year end in the terms of pare 5-13 of AS-28 issued by ICAI for the purpose of arriving at impairment loss thereon if any being the difference the book value and recoverable value of relevant assets The impairment loss recognized in the prior accounting periods is reversed if there has been a charged in the estimates of recoverable amount.

15. PROVISIONS CONTINGENT LIABILITIES AND CONTINGENT ASSETS

a) A Provision is made in the accounts if it becomes problem that an out flow of resources embodying economic benefits will be required to settle the obligation in respect of which a reliable estimate can be made.

b) Contingent Liability are disclosed after a careful evaluation of the facts and legal aspects of the matter involved

c) Contingent Assets are neither recognized nor disclosed as per Accounting standard -29 issued by the institute of chartered Accountants of India.

16. PROVISION FOR DOUBTFUL DEBTS LOANS AND ADVANCES

The amount of Sundry Debtors Loans and Advances in closed rejects pertaining to Govt of India Departments and PSEs clients are considered Good for realization irrespective of the age debtors/loans and advances These debts are under constant persuasion for realization till final settlement made with the client or verdict is passed by the arbitrator/court in case of dispute Necessary provision against doubtful debts/loans and advances is made based on the previous experience of the Management Debtors/ Advances are written off when considered unrealizable.

17 UNADJUSTED CFIEDTT BALANCES WRITTEN BACK

Write back is done on closure of the concerned project or earlier based on the previous experience of the Management.

19 JOINT VENTURE

i) Jointly controlled offend operations are accounted as independent contract entity.

ii) In respect of contracts/Reality projects executed by a jointly controlled entity the profit/loss from the joint venture is a accounted for as and when determined.

19 ARBITRATION

Arbitration courts awards to the extent net taken into accounts at the time of initiation are accounted for after in becomes Decree interest to form in these cases are account for on actual receipt/payment basis.

2D LIQUIDATED DAMAGES

Liquidated Damages .'' Cam pa real ion for delay in reaped of Cans revert.'' Ocala cores, ill any, are accorded for when the matter a considered scathed by the meaner.

21 SEGMENT REPORTING

The company has indentified three primary reporting segments based on nature of business activities viz Real Estate infrastructure and civil construction.

22 INSURANCE CLAIMS

Insurance claims are accounted for on the basis of claims accepted by the insurers in the year of acceptance.


Mar 31, 2012

1. (a) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

These financial statement are prepared in accordance with Indian Generally accepted accounting principles (GAAP) under the historical cost convention on the accural basis except for certain financial instruments which are measured at fair values. GAAP comprises mandatory accounting standards as prescibed by the Companies (Accounting Standards) Rules 2006 as amended issued by the Central Government, the provision of Companies Act,1956 and guidelines issued by the Securities and Exchange Board of India (SEBI).The accounting policies have been consistently followed by the Company.

(b) USE OF ESTIMATES

The financial statements are prepared in accordance with generally accepted accounting principles (GAAP) in India which requires management to make estimates and assumptions that affect the reported balances of assets, liabilities and disclosure of contingent liabilities as at the date of the finacial statement and reported amounts of income & expenses during the periods. The estimates and assumptions used in the accompanying financial statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the financial statements which in management's opinion are prudent and reasonable. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revision to accounting estimates is recognized prospectively in current and future periods.

2. INCOME RECOGNITION

(a) Value of work done is being shown in the accounts based on percentage completion method. Such an evaluation of work done is based on the previous experience of the Management.

(b) Value of work done and Sundry Debtors include:

i) Work done for the constituent for which only letters of intent have been received however formal contracts / agreements are in the process of execution.

ii) Work executed and measured by the Corporation pending certification by the constituent.

iii) Work executed but not measured / partly executed / accounted for at engineering estimated cost.

iv) Extra and substituted items to the extent considered realizable based on the previous experience of the Management.

v) Claims referred to arbitration or lodged against constituent to the extent considered realizable based on the previous experience of the Management.

vi) Amount retained by the constituent is released after the commissioning of the project.

(c) Value of work done for Real Estate Projects (Reality Project), taking into account the total expenditure incurred in the project, is accounted for in the year of receipts of sale consideration or on the basis of execution of sale documents with the buyers, wherever significant sale consideration has been recieved, whichever is earlier. Sales documents also include unregistered agreement to sell.

3. WORK-IN-PROGRESS

Work-in-progress incudes unsold portion of Real Estate pertaining to Reality Projects. The increase / decrease in Work-in- Progress is accounted for as income or expenditure of the year, as the case may be. Valuation of work-in-progress including unsold portion of reality project is being done on the basis of incurrence of expense directly attributable to the project.

4. FIXED ASSETS

Fixed Assets are stated at historical cost less accumulated depreciation. Cost directly attributable to acquisition of fixed assets are capitalized.

5. DEPRECIATION & AMORTISATION

a) Depreciation on fixed assets is calculated on Straight Line Method in accordance with the provisions of schedule-XIV to the Companies Act, 1956.

b) Fixed Assets costing upto Rs. 5000/- each are depreciated fully in the year of its acquisition.

c) Temporary hutments and installation are depreciated fully in the year of its creation.

d) Hostel / Staff Camps equipments are considered as Current Assets and the depreciation thereon is ascertained by deducting the realizable value as estimated by the Management from the book value.

e) Amortisation amounts in respect of Centering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others is ascertained by deducting the realizable value, as estimated by the Management from the book value.

6. FOREIGN CURRENCY TRANSACTIONS

(a) Foreign Projects

The basis adopted for conversion of foreign currency:-

i) Revenue items other than opening and closing inventories and depreciation are translated into Indian Currency at an average rate of the month of the transaction.

ii) Assets (other than fixed assets), liabilities relating to foreign projects have been translated into Indian currency at the closing buying rates. Balance of Head Office account in the books of branch is reported at the amount of balance of branch account appearing in the books of Head Office.

iii) The net exchange difference resulting from the translation of items in respect of foreign branches is charged or credited to Profit & Loss Account except to the extent adjusted in the carrying amount of the related fixed assets.

(b) Inland Projects

Foreign currency in respect of revenue items are translated into Indian Rupees on the date of transaction and liabilities are translated in Indian Rupees at the closing buying rates. The difference, if any, is recognized as revenue / expenditure, as the case may be during the year.

7. VALUATION OF INVENTORIES

a) Valuation of Direct Material, Stores & spare parts, Steel Scrap, Tools & Equipments etc are done at lower of historical cost or net realizable value .

b) Centering, shuttering & Scaffolding and Hostel / Staff Camp equipments are valued at written down value arrived at after deducting amortization / depreciation indicted in para 5(e) above.

8. INVESTMENTS

Short Term Investments are valued at Lower of Original Cost or Net Realizable Value.

9. RETIREMENT BENEFITS

a) Gratuity

The provision for gratuity is made in the accounts in accordance with the provisions of the Payment of Gratuity Act on actuarial basis.

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

c) Travelling Allowance on Superannuation

The provision for travelling allowance on superannuation is made on actuarial basis.

10. DEFERRED REVENUE EXPENDITURE

Expenditure incurred for acquiring Technical know-how is treated as Deferred Revenue Expenditure and charged to Profit & Loss Account in equal yearly instalments over a period of six years or estimated life of the know-how, whichever is less.

11. The consumption of material at site is net of recovery / sale from / to PRW / Others and inter-unit transfers. Shortage of materials on account of theft, pilferage etc., if any, is booked separately under the appropriate discrepancy head.

12. PRIOR PERIOD EXPENDITURE / INCOME

Expenditure / Income upto Rs. 50,000/- in each case relating to prior period has been charged / accounted for to the respective head of accounts.

13. TAXES ON INCOME

Income Tax is accounted for in accordance with Accounting Standard-22 'Accounting for taxes on income' issued by ICAI, which includes Current Taxes and Deferred Taxes.

Deferred tax is recognized on timing differences, being the difference between taxable income and Accounting income that originate in one period and are capable of reversing in one or more subsequent period.

Deferred Tax Assets are recognized only to the extent there is a reasonable certainty of its realization.

14. IMPAIRMENT OF ASSETS

The company identifies impairable assets based on individual assets concept at the year-end in the terms of para 5-13 of AS- 28 issued by ICAI for the purpose of arriving at impairment loss thereon, if any, being the difference between the book value and recoverable value of relevant assets. The impairment loss recognized in the prior accounting periods is reversed if there has been a change in the estimates of recoverable amount.

15. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

a) A provision is made in the accounts if it becomes probable that an out flow of resources embodying economic benefits will be required to settle the obligation in respect of which a reliable estimate can be made.

b) Contingent Liabilities are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.

c) Contingent Assets are neither recognized nor disclosed as per Accounting Standard-29 issued by the Institute of Chartered Accountants of India.

16. PROVISION FOR DOUBTFUL DEBTS / LOANS AND ADVANCES

The amount of Sundry Debtors / Loans and Advances in closed projects, pertains to Govt. of India Departments and PSEs clients are considered Good for realisation irrespective of the age of debtors / loans and advances. These debts are under constant persuasion for realisation till final settlement made with the client or verdict is passed by the arbitration / court, in case of dispute. Necessary provision against doubtful debts / loans and advances is made based on the previous experience of the Management. Debtors / Advances are written-off when considered unrealisable.

17. JOINT VENTURE

i) Jointly controlled operations are accounted as independent contract / entity.

ii) In respect of contracts / Reality Projects executed by a jointly controlled entity, the profit / loss from the Joint Venture is accounted for as and when determined.

18. ARBITRATION

Arbitration / Court's awards, to the extent not taken into accounts at the time of lodge, are accounted for after it becomes Decree. Interest to / from in these cases are accounted for on actual receipt / payment.

19. LIQUIDATED DAMAGES

Liquidated Damages / Compensation for delay in respect of constituent / contractors, if any, are accounted for when the matter is considered settled by the management.

20. SEGMENT REPORTING

The company has identified three primary reporting segments based on nature of business activities viz. Real Estate, Infrastructure and Civil Construction.

21. INSURANCE CLAIMS

Insurance claims are accounted for on the basis of claims accepted by the insurers in the year of acceptance.


Mar 31, 2008

1. FINANCIAL STATEMENTS

The financial statements are prepared under the historical cost convention and generally accepted accounting principles in accordance with the Companies Act, 1956 and with the compliance of Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI) to the extent applicable. The Company maintains its accounts on accrual basis as a going concern except where otherwise stated.

2. INCOME RECOGNITION

a) Value of work done is being shown in the accounts based on percentage completion method. Such an evaluation of work done is based on the previous experience of the Management.

b) Value of work done and Sundry Debtors include:

i) Work done for the constituent for which only letters of intent have been received however formal contracts / agreements are in the process of execution.

ii) Work executed and measured by the Corporation pending certification by the constituent.

iii) Work executed but not measured / partly executed / accounted for at engineering estimated cost.

iv) Extra and substituted items to the extent considered realizable based on the previous experience of the Management.

v) Claims referred to arbitration or lodged against constituent to the extent considered realizable based on the previous experience of the Management.

vi Amount retained by the constituent is released after the commissioning of the project.

c) Value of work done for Real Estate Projects (Reality Project), taking into account the total expenditure incurred in the project, is accounted for in the year of receipts of sale consideration or on the basis of execution of sale documents with the buyers, wherever significant sale consideration has been received, whichever is earlier. Sales documents also include unregistered agreement to sell.

3. WORK-IN-PROGRESS

Work-in-progress includes unsold portion of Real Estate pertaining to Reality Project. The increase / decrease in Work-in-Progress is accounted for as income or expenditure of the year, as the case may be. Valuation of work in progress including unsold portion of reality project is being done on the basis of incurrence of expense directly attributable to the project.

4. FIXED ASSETS

Fixed Assets are stated at cost. Cost directly attributable to acquisition of fixed assets are capitalized.

5. DEPRECIATION & AMORTISATION

a) Depreciation on fixed assets is calculated on Straight Line Method in accordance with the provisions of schedule XIV to the Companies Act, 1956.

b) Fixed assets costing upto Rs.5000/- each are depreciated fully in the year of its acquisition.

c) Temporary hutments and installation are depreciated fully in the year of its creation.

d) Furniture, Fixtures and Equipments in Transit / Staff Camps are considered as Current Assets and the depreciation thereon is ascertained by deducting the realizable value as estimated by the Management from the book value.

e) Amortisation amounts in respect of Centering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others is ascertained by deducting the realizable value, as estimated by the Management from the book value.

6. FOREIGN CURRENCY TRANSACTIONS

a) Foreign Projects

The basis adopted for conversion of foreign currency:-

i) Revenue items other than opening and closing inventories and depreciation are translated into Indian Currency at an average rate of the month of the transaction.

ii) Assets (other than fixed assets), liabilities relating to foreign projects have been translated into Indian currency at the closing buying rates. Balance of Head Office account in the books of branch is reported at the amount of balance of branch account appearing in the books of Head Office.

iii) Fixed Assets as on 31st March, 1991 have been converted at closing buying rate prevalent on 31st March, 1991. The transactions after 31st March, 1991 relating to fixed assets and depreciation thereon have been valued at the original purchase rate.

iv) The net exchange difference resulting from the translation of items in respect of foreign branches is charged or credited to Profit & Loss Account except to the extent adjusted in the carrying amount of the related fixed assets.

b) Inland Projects

Foreign currency in respect of revenue items are translated into Indian Rupees on the date of transaction and liabilities are translated in Indian Rupees at the closing buying rates. The difference, if any, is recognized as revenue / expenditure, as the case may be during the year.

7. VALUATION OF INVENTORIES

a) Valuation of Direct Material is done at lower of historical cost or net realizable value.

b) Stores and spare parts are valued at cost

c) Steel scrap, Tools & Equipments etc. are valued at estimated realizable value.

d) Centering, shuttering & Scaffolding and furniture, fixture & equipments in transit /staff camps are valued at written down value arrived at after deducting amortization /depreciation indicated in para 5(e) above.

8. INVESTMENTS

Investments are valued at cost.

9. RETIREMENT BENEFITS

a) Gratuity

The provision for gratuity is made in the accounts in accordance with the provisions of the Payment of Gratuity Act on actuarial basis.

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

10. DEFERRED REVENUE EXPENDITURE

Expenditure incurred for acquiring Technical know-how is treated as Deferred Revenue Expenditure and charged to Profit & Loss Account in equal yearly installments over a period of six years or estimated life of the know-how, whichever is less.

11. The consumption of material at site is net of recovery / sale from / to PRW / Others and inter-unit transfers. Shortage of materials on account of theft, pilferage etc., if any, is booked separately under the appropriate discrepancy head.

12. PRIOR PERIOD EXPENDITURE/INCOME

Expenditure / Income upto Rs. 50,000/- in each case relating to prior period has been charged / accounted for to the respective head of accounts.

13. TAXES ON INCOME

Deferred tax is recognized on timing differences, being the difference between taxable income and Accounting income that originate in one period and are capable of reversing in one or more subsequent period.

Deferred Tax Assets are recognized only to the extent there is a reasonable certainty of its realization.

14. IMPAIRMENT OF ASSETS

The company identifies impairable assets based on individual assets concept at the year-end in the terms of para 5-13 of AS-28 issued by ICAI for the purpose of arriving at impairment loss thereon, if any, being the difference between the book value and recoverable value of relevant assets. Impairment loss when crystallizes is charged against revenue of the year.

15. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Contingent liabilities and contingent assets are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.

16. JOINT VENTURE

i) Jointly controlled operations are accounted as independent contract/ entity.

ii) In respect of contracts / Reality Projects executed by a jointly controlled entity, the profit/ loss from the Joint Venture is accounted for as and when determined.

17. ARBITRATION

Arbitration / Court's awards, to the extent not taken into accounts at the time of lodge, are accounted for after it becomes Decree. Interest to / from in these cases are accounted for on actual receipt / payment.

18. LIQUIDATED DAMAGES

Liquidated Damages / Compensation for delay in respect of constituent/ contractors, if any, are accounted for when the matter is considered settled by the management.

19. SEGMENT REPORTING

The company has identified three primary reporting segments based on nature of business activities viz. Real Estate, Infrastructure and civil construction.


Mar 31, 2006

1. FINANCIAL STATEMENTS

The financial statements are prepared under the historical cost basis and are in accordance with the generally accepted accounting principles and the provision of the Companies Act, 1956. The Company maintains its accounts on accrual basis as a going concern except where otherwise stated.

2. VALUE OF WORK DONE (INCOME RECOGNITION):

a) Value of work done is being shown in the accounts after deductions in the event of possible likely rejections. Such an evaluation of work done is based on the previous experience of the Management.

b) Value of work done and Sundry Debtors include:

i) Work done for the constituent for which only letters of intent have been received however formal contracts / agreements are in the process of execution.

ii) Work executed and measured by the Corporation pending certification by the constituent.

iii) Work executed but not measured/partly executed accounted for at engineering estimated cost.

iv) Extra and substituted items to the extent considered realisable based on the previous experience of the Management.

v) Claims referred to arbitration or lodged against constituent to the extent considered realisable based on the previous experience of the Management.

vi) Amount retained by the constituent is released after the commissioning of the project.

c) Value of work done for Real Estate Projects(Reality Project), taking into account the total expenditure incurred in the project, is accounted for in the year of actual receipts of sale proceeds or on the basis of execution of sale documents with the buyers whichever is earlier. Sales documents also include unregistered agreement to sell.

3. WORK-IN-PROGRESS

Work-in-progress includes unsold portion of Real Estate pertaining to Reality Project and other projects where work has not yet started. The increase/decrease in Work-in-Progress is accounted for as income or expenditure for the year, as the case may be. Valuation of work in progress including unsold portion of reality project is being done on the basis of incurrence of expense directly attributable to the project.

4. FIXED ASSETS

Fixed Assets are stated at cost. Costs directly attributable to acquisition of fixed assets are capitalised.

5. DEPRECIATION & AMORTISATION

a) Depreciation on fixed assets is calculated on straight line method in accordance with the provisions of schedule XIV to the Companies Act, 1956.

b) Fixed assets costing upto Rs.5000/- each are depreciated fully in the year of its acquisition.

c) Temporary hutments and installations are depreciated fully in the year of its creation.

d) Furniture, Fixtures and Equipments in Transit/Staff Camps are considered as Current Assets and the depreciation thereon is ascertained by deducting the realisable value as estimated by the Management from the book value.

e) Amortisation amounts in respect of Centering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others is ascertained by deducting the realisable value, as estimated by the Management from the book value.

6. FOREIGN CURRENCY TRANSACTIONS

a) Foreign Projects

(i) Revenue items, other than opening and closing inventories and depreciation, are translated into Indian Currency at an average of opening and closing buying rates.

(ii) Assets (other than Fixed Assets), liabilities relating to foreign projects have been translated into Indian currency at the closing buying rates. Balance of Head Office account in the books of branch is reported at the amount of balance of branch account appearing in the books of Head Office.

(iii) Fixed Assets as on 31st March,1991 have been converted at closing buying rate prevalent on 31st March, 1991. The transactions after 31st March,1991 relating to fixed assets and depreciation thereon have been valued at the original purchase rate.

(iv) The net exchange difference resulting from the translation of items in respect of foreign branches is charged or credited to Profit & Loss Account except to the extent adjusted in the carrying amount of the related fixed assets in accordance with para 6(a)(iii) above.

b) Inland projects

Foreign currency liabilities are translated in Indian Rupees at the closing buying rates. The difference, if any, is transferred to fixed assets in case liabilities are related to fixed assets and in other case the difference, if any, is recognised as revenue / expenditure, as the case may be, during the year.

7. VALUATION OF INVENTORIES

a) Valuation of Direct Material is done at lower of historical cost or net realisable value.

b) Stores and spare parts are valued at cost.

c) Steel scrap, Tools & Equipments etc. are valued at estimated realisable value.

d) Centering, shuttering & Scaffolding and furniture, fixture & equipments in transit/staff camps are valued at written down value arrived at after deducting amortisation/depreciation indicated in para 5 above.

8. INVESTMENTS

Long Term Investments are valued at cost.

9. RETIREMENT BENEFITS

a) Gratuity

The provision for gratuity is made in the accounts in accordance with the provisions of the Payment of Gratuity Act on actuarial basis.

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

10. DEFERRED REVENUE EXPENDITURE

a) Expenditure incurred for acquiring Technical know-how is treated as Deferred Revenue Expenditure and charged to Profit & Loss Account in equal yearly installments over a period of six years or estimated life of the know-how, whichever is less.

b) Expenditure on preparatory works such as soil investigation, survey and consultancy have been treated as Deferred Revenue Expenditure where physical execution of work has not yet started. Such expenditure will be charged to profit & loss account on the commencement of the project.

11. The consumption of material at site is net of recovery/sale from/to PRW/ Others and inter-unit transfers. Shortage of materials on account of theft, pilferage etc., if any, is booked separately under the appropriate discrepancy head.

12. PRIOR PERIOD EXPENDITURE/INCOME

Expenditure/Income upto Rs.50,000/- in each case relating to prior period has been charged/accounted for to the respective head of accounts.

13. TAXES ON INCOME

Deferred tax is recognised on timing differences, being the difference between taxable income and Accounting income that originate in one period and are capable of reversing in one or more subsequent period.

Deferred Tax Assets are recognised only to the extent there is a reasonable certainty of its realisation.


Mar 31, 2005

1. FINANCIAL STATEMENTS

The financial statements are prepared under the historical cost basis and are in accordance with the generally accepted accounting principles and the provision of the Companies Act, 1956. The Company maintains its accounts on accrual basis as a going concern except where otherwise stated.

2. VALUE OF WORK DONE (INCOME RECOGNITION):

- Value of work done is being shown in the accounts after deductions in the event of possible likely rejections. Such an evaluation of work done is based on the previous experience of the Management.

- Value of work done and Sundry Debtors include:

i) Work done for the constituent for which only letters of intent have been received however formal contracts / agreements are in the process of execution. xvi) Work executed and measured by the Corporation pending certification by the constituent.

ii) Work executed but not measured/partly executed accounted for at engineering estimated cost. xvi) Extra and substituted items to the extent considered realizable based on the previous experience of the Management. xvi) Claims referred to arbitration or lodged against constituent to the extent considered realisable based on the previous experience of the Management.

iii) Amount retained by the constituent is released after the commissioning of the project.

- Value of work done for Real Estate Projects(Reality Project), taking into account the total expenditure incurred in the project, is accounted for in the year of actual receipts of sale proceeds or on the basis of execution of sale documents with the buyers.

3. WORK-IN-PROGRESS

Work-in-progress includes unsold portion of Real Estate pertaining to Reality Project and other projects where work has not yet started. The increase/decrease in Work-in-Progress is accounted for as income or expenditure for the year, as the case may be. Valuation of work in progress including unsold portion of reality project is being done on the basis of incurrence of expense directly attributable to the project.

4. FIXED ASSETS

Fixed Assets are stated at cost. Costs directly attributable to acquisition of fixed assets are capitalized

5. DEPRECIATION & AMORTISATION

- Depreciation on fixed assets is calculated on straight line method in accordance with the provisions of schedule XIV to the Companies Act, 1956.

- Fixed assets costing upto Rs.5000/- each are depreciated fully in the year of its acquisition.

- Temporary hutments and installations are depreciated fully in the year of its creation.

- Furniture, Fixtures and Equipments in Transit/Staff Camps are considered as Current Assets and the depreciation thereon is ascertained by deducting the realizable value as estimated by the Management from the book value.

- Amortisation amounts in respect of Cantering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others is ascertained by deducting the realizable value, as estimated by the Management from the book value.

6. FOREIGN CURRENCY TRANSACTIONS

a) Foreign Projects

(i) Revenue items, other than opening and closing inventories and depreciation, are translated into Indian Currency at an average of opening and closing buying rates.

(ii) Assets (other than Fixed Assets), liabilities relating to foreign projects have been translated into Indian currency at the closing buying rates. Balance of Head Office account in the books of branch is reported at the amount of balance of branch account appearing in the books of Head Office.

(iii) Fixed Assets as on 31st March,1991 have been converted at closing buying rate prevalent on 31st March, 1991. The transactions after 31st March,1991 relating to fixed assets and depreciation thereon have been valued at the original purchase rate.

(iv) The net exchange difference resulting from the translation of items in respect of foreign branches is charged or credited to Profit & Loss Account except to the extent adjusted in the carrying amount of the related fixed assets in accordance with para 6(a)(iii) above.

b) Inland projects

Foreign currency liabilities are translated in Indian Rupees at the closing buying rates. The difference, if any, is transferred to fixed assets in case liabilities are related to fixed assets and in other case the difference, if any, is recognized as revenue / expenditure, as the case may be, during the year.

7. VALUATION OF INVENTORIES

- Valuation of Direct Material is done at lower of historical cost or net realizable value.

- Stores and spare parts are valued at cost.

- Steel scrap, Tools & Equipments etc. are valued at estimated realizable value.

- Centering, shuttering & Scaffolding and furniture, fixture & equipments in transit/staff camps are valued at written down value arrived at after deducting amortization/depreciation indicated in para 5 above.

8. INVESTMENTS

Long Term Investments are valued at cost.

9. RETIREMENT BENEFITS

e) Gratuity

The provision for gratuity is made in the accounts in accordance with the provisions of the Payment of Gratuity Act on actuarial basis.

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

10. DEFERRED REVENUE EXPENDITURE

- Expenditure incurred for acquiring Technical know-how is treated as Deferred Revenue Expenditure and charged to Profit & Loss Account in equal yearly instalments over a period of six years or estimated life of the know-how, whichever is less.

- Expenditure on preparatory works such as soil investigation, survey and consultancy have been treated as Deferred Revenue Expenditure where physical execution of work has not yet started. This expenditure shall be charged proportionately on the basis of actual execution of work.

11. The consumption of material at site is net of recovery/sale from/to PRW/ Others and inter-unit transfers. Shortage of materials on account of theft, pilferage etc., if any, is booked separately under the appropriate discrepancy head.

12. PRIOR PERIOD EXPENDITURE/INCOME

Expenditure/Income upto Rs.50,000/- in each case relating to prior period has been charged/accounted for to the respective head of accounts.

13. TAXES ON INCOME

Deferred tax is recognised on timing differences, being the difference between taxable income and Accounting income that originate in one period and are capable of reversing in one or more subsequent period.

Deferred Tax Assets are recognized only to the extent there is a reasonable certainty of its realization.


Mar 31, 2004

1. FINANCIAL STATEMENTS

The financial statements are prepared under the historical cost basis and are in accordance with the generally accepted accounting principles and the provision of the Companies Act, 1956. The Company maintains its accounts on accrual basis as a going concern except where otherwise stated.

2. VALUE OF WORK DONE:

- Value of work done and Sundry Debtors are shown in the accounts after deductions for likely rejections identified and evaluated at best estimates by the Management.

- Value of work done and Sundry Debtors include:

i) Work done for the clients for which letters of intent have been received but formal contracts/ agreements are yet to be executed.

ii) Work done and measured by the Corporation but not certified by the clients.

iii) Unmeasured/partly executed work accounted for at engineering estimates.

iv) Extra and substituted items to the extent considered realisable by the Management.

v) Claims referred to arbitration or lodged against Clients to the extent considered realisable by the Management.

Vii) Value of work done for Real Estate Projects is accounted for in the ratio of the total estimated realisable value to the total estimated expenditure on the basis of agreement to sell or execution of sale deed or acceptance of sale by the buyer.

3. WORK-IN-PROGRESS

Work-in-progress includes unsold portion of Real Estate and Defence Housing Project (DHP). Valuation of unsold portion of Real Estate is done at lower of cost or net realisable value. Cost includes material consumed, overheads, depreciation/ amortisation and interest cost directly attributable to the project. The increase/decrease in Work-in-Progress is accounted for as income or expenditure for the year, as the case may be.

4. FIXED ASSETS

Fixed Assets are stated at cost. Costs directly attributable to acquisition of fixed assets are capitalised

5. DEPRECIATION & AMORTISATION

- Leasehold land is amortised over the period of lease.

- Depreciation on fixed assets is calculated on straight line method in accordance with the provisions of schedule XIV to the Companies Act, 1956.

- Fixed assets costing upto Rs.5000/- each are depreciated fully in the year of capitalisation.

- Temporary hutments and installations are depreciated fully in the year of capitalisation.

- Furniture, Fixtures and Equipments in Hostel/Staff Camps are considered as Current Assets and the depreciation thereon is ascertained by deducting the realisable value as estimated by the Management from its book value.

- Amortisation amounts in respect of Centering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others is ascertained by deducting the realisable value, as estimated by the Management, from its book value.

6. FOREIGN CURRENCY TRANSACTIONS

a) Foreign Projects

(v) Revenue items, other than opening and closing inventories and depreciation, are translated into Indian Currency at average of opening and closing buying rates.

(v) Assets (other than Fixed Assets), liabilities relating to foreign projects have been translated into Indian currency at the closing buying rates. Balance of Head Office account in the books of branch is reported at the amount of balance of branch account appearing in the books of Head Office.

(v) Fixed Assets as on 31st March,1991 have been converted at closing buying rate prevalent on 31st March, 1991. The transactions after 31st March,1991 relating to fixed assets and depreciation thereon have been valued at the original purchase rate.

(iv) The net exchange difference resulting from the translation of items in respect of foreign branches is charged or credited to Profit & Loss Account except to the extent adjusted in the carrying amount of the related fixed assets in accordance with para 6(a)(iii) above.

e) Inland projects

Foreign currency liabilities are translated in Indian Rupees at the closing buying rates. The difference, if any, is transferred to fixed assets in case liabilities are related to fixed assets and in other case the difference, if any, is recognised as revenue / expenditure, as the case may be, during the year.

7. VALUATION OF INVENTORIES

- Valuation of Direct Material is done at lower of historical cost and net realisable value.

- Stores and spare parts are valued at cost.

- Steel scrap, Tools & Equipments etc. are valued at estimated realisable value.

- Centering, shuttering & Scaffolding and furniture, fixture & equipments in hostel/staffcamps are valued at written down value arrived at after deducting amortisation/depreciation indicated in para 5 above.

8. INVESTMENTS

Long Term Investments are valued at cost.

9. RETIREMENT BENEFITS

f) Gratuity

The provision for gratuity is made in the accounts in accordance with the provisions of the Payment of Gratuity Act on actuarial basis.

b) Leave Encashment

The provision for leave encashment of employees is made on actuarial basis.

10. TECHNICAL KNOW-HOW

Expenditure incurred for acquiring Technical know-how is treated as Deferred Revenue Expenditure and charged to Profit & Loss Account in equal yearly installments over a period of six years or estimated life of the know-how, whichever is less.

11. The consumption of material at site is net of recovery/sale from/to PRW/ Others and inter-unit transfers. Shortage of materials on account of theft, pilferage etc., if any, is booked separately under the appropriate discrepancy head.

12. PRIOR PERIOD EXPENDITURE/INCOME

Expenditure/Income upto Rs.50,000/- in each case relating to prior period has been charged/accounted for to the respective head of accounts.

13. Sales Tax / Turnover Tax is adjusted in the books of accounts at the time of final assessment except where composite tax scheme is adopted.

TAXES ON INCOME

14. Current tax is determined as the amount of tax payable in respect of taxable income for the period. Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

 
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