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Accounting Policies of Ritesh Properties & Industries Ltd. Company

Mar 31, 2015

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Cost of the acquisition of new assets is inclusive of taxes and other incidental expenses.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Stock (Real Estate) At Cost

2) Project Expenses On the basis of actual expenses incurred

d) Revenue Recognition

1) Sales are recognized to the extent of project completion basis. During the year, the manage- ment has certified that the development of Project has been completed to the extent of 90% till 31.03.2015 (Previous Year 90%) on mercantile basis. Accordingly the revenue has been recognized.

2) Foreign currency fluctuations during the year are NIL (Previous year NIL).

3) Vat tax liability is accounted for on the basis of sales/Vat tax returns filed and tax deposited by the Company. Additional liability, if any, arises at the time of assessment, will be accounted for in the year of finalization of assessment.

e) Foreign Exchange Transaction Nil (Previous year Nil)

f) Depreciation

Consequent to the enactment of the Companies Act, 2013(the act) and its applicability for the accounting periods after April 1, 2014, the company has computed depreciation with reference to the estimated economic lives of the fixed assets prescribed by the Schedule II to the Act. For assets whose life is over, the carrying value, net of residual value, aggregating to Rs.4.53 lacs as at April 1, 2014 has been adjusted to retained earnings and in other assets the carrying value as at April 1,2014 has been depreciated over the remaining of the revised useful life of the assets and recognized in the above financial results. As a result, charge of depreciation is higher by Rs. 5.20 Lacs for the Qtr and for the year ended March 31,2015 and the net profit from activities before tax is lower by the same amount.

g) Retirement Benefits

Gratuity liability has been accounted for on an accrual basis.

Contribution to Provident Fund, Family Pension Scheme and E.S.I. are accounted for on accrual basis and charged to Profit & Loss Account accordingly.

h) Investments Investments are valued at cost.

I) Accounting of Taxes on Income

No provision for current tax is made on the basis of estimated taxable income for the current accounting year, in accordance with the provision of Income Tax Act, 1961.

The deferred tax for timing difference between the book profits and tax profits for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. Deferred tax asset arising from timing difference are recognized to the extent there is reasonable certainty that these would be realized in future and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates will be recognized prospectively in future periods.

k) IMPAIRMENT OF ASSETS

The Company assesses at each balance sheet whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the Profit and Loss Statement. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount subject to a maximum of depreciated historical cost and is accordingly reversed in the Profit and Loss Statement.






Mar 31, 2014

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Costs of the acquisition of new assets are inclusive of taxes and other incidental expenses.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Finished Goods At Estimated (Factories) : realizable value

2) Stock At Cost (Real Estate) :

3) Project On the basis of Development actual expenses Expenses incurred

d) Revenue Recognition

1) Sales are recognized to the extent of project completion basis. During the year, the management has certified that the development of Project has been completed to the extent of 90% till 31.03.2014 (Previous Year 80%) on mercantile basis. Accordingly the revenue has been recognized.

2) Foreign currency fluctuations during the year are NIL( Previous year NIL).

3) Vat tax liability is accounted for on the basis of sales/Vat tax returns filed and tax deposited by the Company. Additional liability, if any, arises at time of assessment, will be accounted for in the year of finalization of assessment.

e) Foreign Exchange Transaction - NIL (Previous year NIL)

f) Depreciation

Depreciation on Fixed Assets have not been calculated on the rates as per Schedule XIV of the Companies Act, 1956, however, it had been calculated and provided as per the rates prescribed in Income Tax Act, 1961 as consistently been provided year after year in the past.

g) Retirement Benefits

Gratuity liability has been accounted for on accrual basis.

Contribution to Provident Fund, Family Pension Scheme and E.S.I. are accounted for on accrual basis and charged to Profit & Loss Account accordingly.

h) Investment

Investments are valued at cost.

i) Accounting of Taxes on Income

Provision for current tax is made on the basis of estimated taxable income for the current accounting year, in accordance with the provision of Income Tax Act, 1961.

The deferred tax for timing difference between the book profits and tax profits for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. Deferred tax asset arising from timing difference are recognized to the extent there is reasonable certainty that these would be realized in future and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates will be recognized prospectively in future periods.

k) Impairment of Assets

The Company assesses at each balance sheet whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the Profit and Loss Statement. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount subject to a maximum of depreciated historical cost and is accordingly reversed in the Profit and Loss statement.


Mar 31, 2013

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Costs of the acquisition of new assets are inclusive of taxes and other incidental expenses.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Finished Goods At Estimated (Factories): realizable value

2) Stock At Cost (Real Estate):

3) Project On the basis of Development actual expenses Expenses incurred

d) Revenue Recognition

1) Sales are recognized to the extent of project completion basis. During the year, the management has certified that the development of project has been completed to the extent of 80% till 31.03.2013 (Previous Year 55%) on mercantile basis. Accordingly the revenue has been recognized. During the previous year the company has undertaken the development work of the project from Ansal API. The development expenses & other expenses incurred on project by Ansal API was taken as Project Development expenses in the cost of material.

During the previous year the company has changed the method of accounting for the recognition of revenue on the sale of plots. Earlier to the previous year the company was recognized the revenue for their own share of 62.50% on the basis of project completion basis as per the Development Agreement with Ansal API, but during the previous year the company had recognized the sale of plot at its own sale instead of share of revenue.

2) Foreign currency fluctuations during the year are NIL( Previous year NIL).

3) Vat tax liability is accounted for on the basis of sales/Vat tax returns filed and tax deposited by the Company. Additional liability, if any, arises at time of assessment, will be accounted for in the year of finalization of assessment.

e) Foreign Exchange Transaction - NIL (Previous year NIL)

f) Depreciation

Depreciation on Fixed Assets have not been calculated on the rates as per Schedule XIV of the Companies Act, 1956, however, it had been calculated and provided as per the rates prescribed in Income Tax Act, 1961 as consistently been provided year after year in past.

g) Retirement Benefits

Gratuity liability has been accounted for on accrual basis.

Contribution to Provident Fund, Family Pension Scheme and E.S.I, are accounted for on accrual basis and charged to Profit & Loss Account accordingly.

h) Investment

Investments are valued at cost.

i) Accounting of Taxes on Income

Provision for current tax is made on the basis of estimated taxable income for the current accounting year, in accordance with the provision of Income Tax Act, 1961.

The deferred tax for timing difference between the book profits and tax profits for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. Deferred tax asset arising from timing difference are recognized to the extent there is reasonable certainty that these would be realized in future and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates will be recognized prospectively in future periods.

k) Impairment of Assets

The Company assesses at each balance sheet whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the Profit and Loss Statement. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount subject to a maximum of depreciated historical cost and is accordingly reversed in the Profit and Loss Statement.


Mar 31, 2011

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Cost of the acquisition of new assets are inclusive of taxes and other incidental expenses.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Finished Goods : At Estimated realizable Value

2) Stock At Cost (Real Estate)s

d) Revenue Recognition

1) Sales are recognized to the extent of project completion basis. During the year, project on development of mercantile basis by the Management has reported / completed to the extent of 45%. Certificate in this regards have been obtained from the Management of the Company. Company's share of sales to the extent of 62.50% in terms of Agreement with Developer has been provided in the books of accounts of the company on Mercantile System of Accounting followed by the company year after year.

2) Foreign currency fluctuations during the year are NIL.

3) Vat tax liability is accounted for on the basis of sales/Vat tax returns filed and tax deposited by the Company. Additional liability, if any, arises at time of assessment, will be accounted for in the year of finalization of assessment.

e) Foreign Exchange Transaction

NIL

f) Depreciation

Depreciation on Fixed Assets have not been calculated on the rates as per Schedule XIV of the Companies Act, 1956, however, it had been calculated and provided as per the rates prescribed in Income Tax Act, 1961 which has consistently been provided year after year in past.

g) Gratuity

Gratuity liability contribution to Provident Fund, Family Pension Scheme and E.S.I. has been provided on accrual basis.

h) Investment

Investments are valued at cost. All the investments are treated as Long-term investments.

i) Accounting of Taxes on Income

Provision for current tax is made on the basis of estimated taxable income for the current accounting year, in accordance with the provision of Income Tax Act, 1961.

The deferred tax for timing difference between the book profits and tax profits for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. Deferred tax asset arising from timing difference are recognized to the extent there is reasonable certainty that these would be realized in future and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates will be recognized prospectively in future periods. In view of this, the figure of sale of Real Estate of Rs.818.82 lacs have been provided in the books of accounts of the company on estimated project completion to the extent of 45%.

k) Impairment of Assets

The Company assesses at each balance sheet whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount subject to a maximum of depreciated historical cost and is accordingly revered in the profit and loss account.


Mar 31, 2010

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Cost of the acquisition is inclusive of freight, duties, taxes and other incidental expenses.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Raw Material At Cost

2) Finished Goods : At Estimated

realizable Value

3) Others: At Cost

d) Revenue Recognition

1) Sale is recognized on mercantile basis.

2) Foreign currency fluctuations are recognized to revenue at time of realization.

3) Vat tax liability is accounted for on the basis of salesA/at tax returns filed and tax deposited by the Company. Additional liability, if any, arises at time of assessment, will be accounted for in the year of f inalization of assessment.

e) Foreign Exchange Transaction

All the foreign exchange transactions for sale are accounted for at the rate applicable at the time of execution of documents with the bank or dispatch of goods.

f) Depreciation

Depreciation has been calculated as per the Income Tax Act, 1961 on Written down Value Method.

g) Gratuity

Gratuity liability has been accounted for on accrual basis.

Contribution to Provident Fund, Family Pension Scheme and ESI are accounted for on accrual basis and charged to Profit & Loss Account accordingly.

h) Investment

Investments are valued at cost plus incidental expenses, if any. All Investments are treated as Long-term investments, which are stated at cost.

i) Accounting of Taxes on Income

No provision for Income tax has been made keeping in view the carried forward losses of the previous years.

Consequent to the issuance of Accounting Standard 22(AS-22) "Accounting for Taxes on Income" by the Institute of Chartered Accountants of India which is mandatory in nature, the company has reviewed Deferred Taxes which result from the timing difference between the Book Profits and Tax Profits.

In consideration of prudence as set out in paragraph 15 to 18 of AS-22, the company has not recognized Net Deferred Tax Assets in the Financial Statement for the year ended 31.03.2010. Further in accordance with paragraph 19 of AS-22 the Net Deferred Tax Asset, if any, shall be reassessed at the end of each Balance Sheet date hereafter and accordingly due recognition shall be given in the Financial Statements

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates is recognized prospectively in current and future periods.

k) Borrowing Cost

Borrowings cost that are attributable to the acquisition or constructions of qualifying assets are capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expense in the year in which they are incurred.

l) Provisions, Contingent Liabilities And Contingent Assets

A provision is created where there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation.

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

Contingent assets are neither recognized nor disclosed in the financial statements.

m) Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its receivable value. An impairment loss is charged to the profit & loss accounts 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.


Mar 31, 2009

A) Accounting Convention

The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and in accordance with the Accounting Standards applicable in India and the provisions of the Companies Act, 1956 as adopted consistently by the Company.

b) Fixed Assets

All fixed assets are stated at cost less accumulated depreciation. Cost of the acquisition is inclusive of freight, duties, taxes and other incidental expenses. Loss on conversion of foreign currency liability for acquisition of fixed assets is added to the assets.

c) Inventories

The inventories have been determined on the basis of FIFO method and the basis of determining cost for various categories of inventories are as follows:-

1) Raw Material At Cost

2) Finished Goods : At Estimated

realizable Value

3) Others: At Cost

d) Revenue Recognition

1) Sale is recognized on mercantile basis.

2) Foreign currency fluctuations are recognized to revenue at time of realization.

3) Sales/Vat tax liability is accounted for on the basis of sales/Vat tax returns filed and tax deposited by the Company. Additional liability, if any, arises at time of asses- sment, will be accounted for in the year of finalization of assessment.

e) Foreign Exchange Transaction

All the foreign exchange transactions for sale are accounted for at the rate applicable at the time of execution of documents with the bank or dispatch of goods.

f) Depreciation

Depreciation has been calculated as per the Income Tax Act, 1961 on Written down Value Method.

g) Gratuity

Gratuity liability has been accounted for on accrual basis.

Contribution to Provident Fund, Family Pension Scheme and ESI are accounted for on accrual basis and charged to Profit & Loss Account accordingly.

h) Investment

Investments are valued at cost plus incidental expenses, if any. Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost and fair value. Long-term investments are/shall be stated at cost. A provision for diminution shall be made to recognize a decline, other than temporary, in the value of long-term investments.

i) Accounting of Taxes on Income

Since the company has incurred losses during the year, so income-tax for current year has not been provided.

Consequent to the issuance of Accounting Standard 22(AS-22) "Accounting forTaxes on Income" by the Institute of Chartered Accountants of India which is mandatory in nature, the company has reviewed Deferred Taxes which result from the timing difference between the Book Profits and Tax Profits.

Fringe Benefit Tax (FBT) payable under the provisions of section 115WC of the Income Tax Act, 1961, is in accordance with the Guidance Note on Accounting for

Fringe Benefit Tax issued by the ICAI, regarded as an additional income tax and considered in determination of the profits for the year.

j) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting policies in India requires management to make estimates and assumption that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The Management believes that the estimates made in the preparation of the financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of accounting estimates is recognized prospectively in current and future periods.

k) Borrowing Cost

Borrowings cost that are attributable to the acquisition or constructions of qualifying assets are capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expense in the year in which they are incurred.

l) Provisions, Contingent Liabilities And Contingent Assets

A provision is created where there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation.

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

Contingent assets are neither recognized nor disclosed in the financial statements.

m) Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its receivable value. An impairment loss is charged to the profit & loss accounts 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.

 
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