Mar 31, 2013
1.1 Basis of Preparation of Financial Statements
i) The accompanying Financial Statements are prepared under historical conventions in accordance with the generally accepted accounting principles and provisions of the Companies Act, 1956 and the applicable accounting standards referred to under Section 211(3C) of the Companies Act, 1956 as issued by The Institute of Chartered Accountants of India from time to time. The disclosures are made in accordance with the requirements of Schedule VI of the Companies Act, 1956 and the Accounting Standards as applicable to the Company.
ii) The Company is following Mercantile basis of accounting and recognizes Incomes & Expenditures on Accrual basis.
1.2 Use of Estimates
The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of the revenues and expenses during the period. Differences between actual and estimated are recognized in the period in which the result are known or are materialized.
1.3 Revenue Recognition
Income from services rendered is recognised as the service is performed and is booked based on agreements/arrangements with the concerned parties. Interest on investments is booked on a time proportion basis taking into account the amounts invested and the rate of interest.
1.4 Expenditure :
Expenses are accounted for on accrual basis and provision is made for all known losses and liabilities.
1.5 Investments :
Investments are classified as non-current or current, based on managementÂs intention at the time of purchase. Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as non-current investments.
Trade investments are the investments made for or to enhance the CompanyÂs business interests.
Current investments are stated at lower of cost and fair value determined on an individual investment basis. Non-current investments are stated at cost and provision for diminution in their value, other than temporary, is made in the financial statements.
1.6 Fixed Assets
Fixed assets are stated at cost of acquisition less accumulated depreciation. Cost is inclusive of freight, duties, taxes, levies, and other incidental expenses incurred for bringing the assets to their working condition for intended use.
1.7 Intangible Assets
The intangible assets of the Company will be written off over a period of five years from the Financial Year starting from April 1, 2012.
Depreciation is provided on fixed assets as per the written down value method at rates provided in schedule XIV of the Companies Act, 1956 except that of Goodwill. Assets individually costing less than Rs. 5,000/- are fully depreciated in the year of acquisition.
1.9 Impairment of Assets
As at each Balance Sheet date, the carrying amount of assets is tested for impairment so as to determine:
a) the provision for impairment loss, if any, required or
b) the reversal, if any, required of impairment loss required in previous periods. Impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined
a) in the case of an individual asset, at the higher of net selling price and the value in use, and
b) in the case of cash generating unit ( a group of assets that generates identified independent cash flows), at the higher of the cash generating unitÂs net selling price and the value in use Value in use is determined as the present value of estimated future cash flows from the continuing use of an asset and from its disposal at the end of its useful life.
1.10 Taxes on Income :
Provision for Taxation for the year comprises of Current Tax and Deferred Tax and Fringe Benefit Taxes. Income Tax expenses comprise of current tax and deferred tax charge or credit. Current Tax Provision has been determined on the basis of reliefs, deductions available, under the Income Tax Act. Deferred Tax is recognized for all timing differences, subject to the consideration of prudence applying the tax rates that are applicable to the Balance Sheet date based on the developments during the year.
1.11 Earnings Per Share (EPS) :
Basic and Diluted Earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.
1.12 Provisions and Contingent Liabilities
A provision is recognised when there is a present obligation as a result of a past event, it is probable that an outflow will be required to settle the obligation and in respect of which reliable estimate can be made. Provision is not discounted to its present value and is determined based on the best estimate required to settle the obligation at the yearend date. These are reviewed at each year end date and adjusted to reflect the best current estimate. Depending upon the facts of each case and after due evaluation of legal aspects, claims against the Company are accounted for as either provisions or disclosed as contingent liabilities. The Company makes a provision when there is a present obligation as a result of a past event where the outflow of economic resources is probable and a reliable estimate of the amount of obligation can be made. Possible future or present obligations that may but will probably not require outflow of resources or where the same cannot be reliably estimated, is disclosed as contingent liability in the Financial Statements.
1.13 Employee Benefit: a) Gratuity
No provision of gratuity is made in the books of the Company as no employee is more than five years old.
b) Leave Encashment
Leave encashment is made on Cash basis as per leave availed by the Employee.
b) Provident Fund
Contribution is made to state administered fund as a percentage of the covered employee''s salary.
1.14 Cash Flow Statement :
Cash Flow Statement are prepared in accordance with "Indirect Method" as explained in the Accounting Standard on Cash Flow Statement (AS-3) issued by the Institute of Chartered Accountants of India. Cash and cash equivalents include cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.
Mar 31, 2010
1. Since it is not possible to ascertain with reasonable certainty the quantum of accrual in respect of certain insurance and other claims, subsidy and interest on overdue bills from customers, the same are continued to be accounted for as and when received. As also the leave encashment in also continued for as and when paid to the employees.
2. The Income Tax assessments of the Company have been completed upto the Assessment year 2006-07. The Company has been advised that no provision for Income Tax or MAT is necessary for the current financial year in view of the losses.
3. Contingent Liabilities:
Current year Previous year
i. Bills discounted with the Bank Nil Nil
ii. The estimated amount of contracts remaining to be executed on Capital Account and not provided for Nil Nil
iii. Claims against the Company/Disputed Liabilities not acknowledged as debts Nil Nil
iv. Various demands from the Commercial Tax Department as per details. Nil Nil
4. Previous years figures have been regrouped/reclassified wherever necessary to make them comparable with current years figures.
5. Figures in brackets wherever indicated are for previous year.
6. Figures have been rounded off to the nearest rupee.
7. The transactions in Foreign Currency: Transactions in foreign currencies are recorded at the exchango rates prevailing on the date of the transaction or at the rates under related forward exchange contracts, if any.
8. In the opinion of the Board, the Current Assets, Loans & Advances are approximately of the value stated if realized in the ordinary course of business and provisions for all known liabilities have been accounted for.
9. Sundry creditors for supplies of Rs. NILrelating to small and ancillary units.
10. Related party disclosures:-As per Accounting Standard AS-18 issued by the Institute of Chartered Accountants of India, disclosure of transactions with the related parties as defined in the said Accounting Standard are as under:- NIL
11. The Accounting Standard AS22 issued by Institute of Chartered Accountants of India Is applicable to the Company w.e.f. 01.04.2001. However in view of the continued business losses no provision has been made for deferred tax liability for the current year.
12. In the absence of any manufacturing activity in the Company during the year, it is not required to give disclosure or segment reporting as prescribed under Accounting Standard AS-17 of the ICAI. Further, since the Company is also not having any subsidiary, it is not required to prepare Consolidated Financial Statements as required under AS-21/23 during the year under review.