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Accounting Policies of Ram Info Ltd. Company

Mar 31, 2015

2.1 Accounting conventions:

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost basis, as a going concern, in accordance with Generally Accepted Accounting Principles in India, provisions of the Companies Act, 2013 & Accounting Standards notified by the Central Government under the Companies (Accounting Standards) Rules, 2006.

2.2 Use of estimates:

The presentations of financial statements are in conformity with the Generally Accepted Accounting Principles which require estimates and assumptions to be made that affect the reportable amount of assets and liabilities on the date of financial statements and the reportable amount of revenue and expenses during the reporting period. Differences between the actual results and estimates are recognised in the year in which the results are known / materialized.

2.3 Revenue recognition:

Revenue is recognized upon rendering the services to customers as per the invoice raised on milestone basis as per the contracts, in cases of customized application development projects; on completion of installation and acceptance by customer incase of software products and on time and material basis for onsite projects.

2.4 Fixed assets:

Fixed assets are stated at cost of acquisition/purchase price inclusive of duties, taxes, incidental expenses, erection/commissioning expenses etc. up to the date the asset is ready for its intended use.

2.5 Depreciation:

2.5.1 Depreciation on fixed assets is provided on Straight Line Method at the following useful life specified in Schedule II of the Companies Act, 2013

Category Useful Life considered by company (years)

Office Equipment 5

Furniture & Fixtures 10

Computer Systems - other than servers 3

Computer Systems - Servers 6

Electrical Installations 10

Vehicles 6

Building 3

2.5.2 Depreciation on fixed assets added/disposed off during the year is provided on pro-rata basis with reference to the date of addition/disposal

2.6 Impairment of assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of profit & loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

2.7 Foreign currency transactions:

2.7.1 Foreign currency transactions are generally recorded on the basis of exchange rates prevailing on the date of their occurrence. Net exchange gain or loss resulting in respect of Foreign Exchange transactions settled during the periodis recognised in the statement of Profit & Loss.

2.7.2 Foreign currency assets and liabilities (other than those covered by forward contracts) as on the Balance Sheet date are revalued in the accounts on the basis of exchange rates prevailing at the close of the year and exchange differences arising thereon, is adjusted to the cost of fixed assets or charged to the Profit and Loss Account, as the case may be.

2.7.3 In case of transactions covered by forward contracts, the differences between the contract rate and exchange rate prevailing on the date of the transaction is adjusted to the cost of assets or recognized as income or expenses over the life of the contract, as the case may be.

2.8 Borrowing costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of assets. Qualifying Asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

2.9 Taxes on income:

2.9.1 Current year charge:

Provision for taxation is ascertained on the basis of assessable profits computed in accordance with the provisions of Income-tax Act, 1961. However, where the tax is computed in accordance with the provision of Section 115JB of the Income-tax Act, 1961, as Minimum Alternate Tax (MAT), it is charged off to the Profit & Loss Account of the relevant year.

2.9.2 Deferred tax:

Deferred income tax is recognized 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. The tax effect is calculated on the accumulated timing differences at the year end based on tax rates and laws, enacted or substantially enacted as on the Balance Sheet date.

2.10 Provisions, contingent liabilities and contingent assets:

2.10.1 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. Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts. Contingent Assets are neither recognized nor disclosed in the financial statement.

2.11 Cash Flow Statement:

2.11.1 Cash flows are reported using the indirect method, whereby a profit before tax is adjusted for the effects of transactions of non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, financing and investing activities of the Company are segregated.

2.12 Employees Retirement benefits:

2.12.1 Contribution to provident fund is made as per provisions of Employees Provident Fund and Miscellaneous Provisions Act, 1952 and charged to Profit and Loss Account.

2.12.2 The company has an obligation towards Gratuity, a defined benefit retirement plan covering eligible employees. The liability is provided for on the basis of actuarial valuation made at the end of each financial year.

2.12.3 The company has an obligation towards leave encashment, a defined benefit retirement plan covering eligible employees. The liability is provided for on the basis of actuarial valuation made at the end of each financial year.

2.13 Intangible Assets:

2.13.1 Intangible assets are stated at acquisition cost, net of accumulated amortisation and accumulated impairment losses, if any, Intangible assets are amortised over a period of 4 years.

2.13.2 Intangible assets, that are self-generated, are accounted for at cost and amortised over a period of 4 years.

2.14 Earnings Per Share:

2.14.1 Basic earnings per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basis earning per share and also the weightged average number of equity shares, which may be issued on the conversion of all dilutive potential shares, unless the results would be anti-dilutive.

2.15 Segment Reporting:

The accounting policies adopted for segment reporting are in conformity with the accounting policies adopted for the company. Further,

2.15.1 Inter segment revenue has been accounted for based on the transaction price agreed to between segments which is primarily market based.

2.15.2 Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses, which relate to the company as a whole and are not allocable to segments on a reasonable basis, have been included under "Un- allocated corporate expenses net of un-allocatged income".


Mar 31, 2014

1.1 Accounting conventions:

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost basis, as a going concern, in accordance with Generally Accepted Accounting Principles in India, provisions of the Companies Act, 1956 & Accounting Standards notified by the Central Government under the Companies (Accounting Standards) Rules, 2006.

1.2 Use of estimates:

The presentations of financial statements are in conformity with the Generally Accepted Accounting Principles which require estimates and assumptions to be made that affect the reportable amount of assets and liabilities on the date of financial statements and the reportable amount of revenue and expenses during the reporting period. Differences between the actual results and estimates are recognised in the year in which the results are known / materialized.

1.3 Revenue recognition:

Revenue is recognized upon rendering the services to customers as per the invoice raised on milestone basis as per the contracts, in cases of customized application development projects; on completion of installation and acceptance by customer incase of software products and on time and material basis for onsite projects.

1.4 Fixed assets:

Fixed assets are stated at cost of acquisition/purchase price inclusive of duties, taxes, incidental expenses, erection/ commissioning expenses etc. up to the date the asset is ready for its intended use.

1.5.0 Depreciation:

1.5.1 Depreciation on fixed assets is provided on Straight Line Method at the following rates specified in Schedule xiii of the Companies Act, 1956

Category Rate %

Office Equipment 4.75

Furniture & Fixtures 6.33

Computer Systems 16.21

Electrical Installations 4.75

Vehicles 9.50

1.5.2 Depreciation on fixed assets added/disposed off during the year is provided on pro-rata basis with reference to the date of addition/disposal

1.5.3 Depreciation on assets costing up to 5,000/- is provided in full in the year of acquisition

1.6.0 Impairment of assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of profit & loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

1.7.0 Foreign currency transactions:

1.7.1 Foreign currency transactions are generally recorded on the basis of exchange rates prevailing on the date of their occurrence.

1.7.2 Foreign currency assets and liabilities (other than those covered by forward contracts) as on the Balance Sheet date are revalued in the accounts on the basis of exchange rates prevailing at the close of the year and exchange differences arising thereon, is adjusted to the cost of fixed assets or charged to the Profit and Loss Account, as the case may be.

1.7.3 In case of transactions covered by forward contracts, the differences between the contract rate and exchange rate prevailing on the date of the transaction is adjusted to the cost of assets or recognized as income or expenses over the life of the contract, as the case may be.

1.8.0 Borrowing costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of assets. Qualifying Asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

1.9.0 Taxes on income:

1.9.1 Current year charge:

Provision for taxation is ascertained on the basis of assessable profits computed in accordance with the provisions of Income-tax Act, 1961. However, where the tax is computed in accordance with the provision of Section 115JB of the Income-tax Act, 1961, as Minimum Alternate Tax (MAT), it is charged off to the Profit & Loss Account of the relevant year.

1.9.2 Deferred tax:

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty, except arising from unabsorbed depreciation and carry forward losses which are recognized to the extent that there is virtual certainty, that sufficient future taxable income will be available against which such tax assets can be realized. Since generation of sufficient future taxable income is uncertain, no deferred tax assest has been recognised in the books.

1.10.0 Provisions, contingent liabilities and contingent assets:

1.10.1 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. Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts. Contingent Assets are neither recognized nor disclosed in the financial statement.

1.11.0 Cash flows are reported using the indirect method, whereby a profit before tax is adjusted for the effects of transactions of non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, financing and investing activities of the Company are segregated


Mar 31, 2013

1.1 Accounting conventions

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost basis, as a going concern, in accordance with Generally Accepted Accounting Principles in India, provisions of the Companies Act, 1956 & Accounting Standards notified by the Central Government under the Companies (Accounting Standards) Rules, 2006.

1.2 Use of estimates

The presentations of financial statements are in conformity with the Generally Accepted Accounting Principles which require estimates and assumptions to be made that affect the reportable amount of assets and liabilities on the date of financial statements and the reportable amount of revenue and expenses during the reporting period. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

1.3 Revenue recognition

Revenue is recognized upon rendering the services to customers as per the invoice raised on milestone basis as per the contracts, in cases of customized application development projects; on completion of installation and acceptance by customer incase of software products and on time and material basis for onsite projects.

1.4 Fixed assets

Fixed assets are stated at cost of acquisition/purchase price inclusive of duties, taxes, incidental expenses, erection/commissioning expenses etc. up to the date the asset is ready for its intended use.

1.5.2 Depreciation on fixed assets added/disposed off during the year is provided on pro-rata basis with reference to the date of addition disposal

1.5.3 Depreciation on assets costing up to 5,000/- is provided in full in the year of acquisition

1.6.0 Impairment of assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of profit & loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

1.7.0 Foreign currency transactions

1.7.1 Foreign currency transactions are generally recorded on the basis of exchange rates prevailing on the date of their occurrence.

1.7.2 Foreign currency assets and liabilities (other than those covered by forward contracts) as on the Balance Sheet date are revalued in the accounts on the basis of exchange rates prevailing at the close of the year and exchange differences arising thereon, is adjusted to the cost of fixed assets or charged to the Profit and Loss Account, as the case may be.

1.7.3 In case of transactions covered by forward contracts, the differences between the contract rate and exchange rate prevailing on the date of the transaction is adjusted to the cost of assets or recognized as income or expenses over the life of the contract, as the case may be.

1.8.0 Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of assets. Qualifying Asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

1.9.0 Taxes on income:

1.9.1 Current year charge

Provision for taxation is ascertained on the basis of assessable profits computed in accordance with the provisions of Income-tax Act, 1961. However, where the tax is computed in accordance with the provision of Section 115JB of the Income-tax Act, 1961, as Minimum Alternate Tax (MAT), it is charged off to the Profit & Loss Account of the relevant year.

1.9.2 Deferred tax

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty, except arising from unabsorbed depreciation and carry forward losses which are recognized to the extent that there is virtual certainty, that sufficient future taxable income will be available against which such tax assets can be realized. Since generation of sufficient future taxable income is uncertain, no deferred tax assest has been recognized in the books.

1.10.0 Provisions, contingent liabilities and contingent assets

1.10.1 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. Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts. Contingent Assets are neither recognized nor disclosed in the financial statement.

1.11.0 Cash flows are reported using the indirect method, whereby a profit before tax is adjusted for the effects of transactions of non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, financing and investing activities of the Company are segregated


Mar 31, 2010

1.1 COST CONVENTION

The Accounts have been prepared under the historical cost convention.

1.2 REVENUE RECOGNITION

All incomes and expenditure are accounted on accrual basis.

1.3 SECURED LOANS

Overdraft facilities from Canara Bank is secured by first charge on Companys Fixed Assets excluding Vehicles and Electrical installations, hypothecation of book debts, equitable mortgage of the property (office space) owned by the Company and also guaranteed by personal guarantee of three directors.

Canara Bank has issued a notice of symbolic possession for the immovable property secured on 30.04.2010 due to the account becoming non performing assets (NPA) and made a claim for Rs.1,49,94,365.08 (excluding contingent liability Rs.47,43,200 for bank guarantees). The management intends to file an appeal to Debt Recovery Tribunal.

Term Loan from Canara Bank is secured by hypothecation of assets (Computers and equipments etc.,) pertaining to "PASS Project of APSRTC "at Visakhapatnam and also guaranteed by personal guarantee of three directors.

1.4 FIXED ASSETS

Fixed Assets have been valued at cost less depreciation.

1.5 DEPRECIATION

Depreciation is provided on straight line method in accordance with the rates prescribed under Schedule XIV of the Companies Act, 1956.

1.6 INVESTMENTS:

Investment in subsidiary is long term in nature and is stated at cost. Business circumstances indicate impairment in the value as the management is of the opinion that there has been decline in value. However the same has not been effected in this year.

1.7 INVENTORIES

Inventories are valued at lower of cost and net realisable value. Cost is determined on First in First out basis.

1.8 FOREIGN EXCHANGE TRANSACTIONS

Earnings in foreign currency are accounted at the rates prevailing on the day of the transaction. Differences in realisation is accounted as fluctuations in foreign currency. Sales made at overseas office and collections deposited in overseas bank accounts and also the expenditure incurred and disbursements made out of the said bank accounts of the overseas office are accounted at a rate that approximates the average monthly rate. However, current assets and current liabilities pertaining to the overseas office are translated at the exchange rate prevalent at the date of the balance sheet and the resultant difference is accounted in the profit and loss account. Fixed assets purchased at overseas office are recorded at cost, based on the exchange rate as of the date of purchase. The charge for depreciation is determined as per the companys accounting policy.

1.9 LEASES:

Leases, where the lessor retains substantially all the risks and rewards incidental to the ownership are classified as operating leases. Operating lease payments are recognised as an expense in Profit & Loss account on straight Line basis over the lease term.

1.10 RETIREMENT BENEFITS:

a) Contribution to Provident Fund is recognised as an expenditure on accrual basis.

b) The company has an obligation towards Gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees on retirement, death while in employment or on termination of employment in an amount equivalent to 15 days salary payable for each completed year of service. Vesting occurs upon completion of five years of service. The Gratuity plans of the entity is an unfunded plan. The company accounts for the liability for future Gratuity benefits on the basis of n independent actuarial valuation.

c) Leave encashment is not categorised as a retirement benefit as the company is in the practice of paying the leave encashment benefit every year.

1.11 DEFERRED TAXES

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty, except arising from unabsorbed depreciation and carry forward losses which are recognized to the extent that there is virtual certainty, that sufficient future taxable income will be available against which such tax assets can be realized.

 
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