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Accounting Policies of Saven Technologies Ltd. Company

Mar 31, 2015

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared under the historical cost convention, on the basis of a going concern, with revenue recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amounts, determined as payable or receivable during the year.

1.2 Cash and cash equivalents

Cash comprises cash on hand and fixed deposits with banks. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

1.3 Cash flow statement

Cash flows are reported using the indirect method, whereby profit/(loss) before extraordinary items and 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, investing and financing activities of the Company are segregated based on the available information.

1.4 Fixed Assets

Fixed assets are capitalized at acquisition cost inclusive of freight, installation cost and other incidental expenses incurred during the year.

1.5 Depreciation and amortisation

Depreciation has been provided on the straight-line method at the rates and in the manner prescribed in Sched- ule II of the Companies Act, 2013.

1.6 Revenue Recognition

Income from services

Revenues from software related services are accounted for on the basis of services rendered, as per terms of contract.

1.7 Other Income

Interest income is recognized on time proportion basis.

Dividend income on investments is accounted when the right to receive the dividend is established.

1.8 Investments

Investments are classified into current investments and long-term investments. Current investments are carried at the lower of cost or fair market value. Any reduction in carrying amount and any reversals of such reduction are charged or credited to the profit and loss account. Long-term investments are carried at cost less provision made to recognize any decline, other than temporary, in the value of such investments.

1.9 Earnings per share (EPS)

The earnings considered in ascertaining the company's EPS comprises the net profit / loss after tax (And includes the post tax effect of any extraordinary items). The number of shares used in computing Basic EPS is the weighted average number of shares outstanding during the year. The number of shares used in computing Diluted EPS comprises of weighted average shares considered for deriving Basic EPS, and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date.

1.10 Employee Benefits

Defined contribution plans:

Contributions in respect of Employees Provident Fund and Pension Fund are made to a fund administered and managed by the Government of India and are charged as incurred on accrual basis.

Defined benefit plans:

The Company also provides for other employee benefits in the form of gratuity. The Company's Contributions to Gratuity scheme are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The gratuity fund is managed by the Life Insurance Corporation of India (LIC).

Long-term employee benefits:

The Company also provides to eligible employee benefits in the form of Leave Encashment. The Company's Contributions are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The Leave encashment fund is managed by the Life Insur- ance Corporation of India (LIC).

Short-term employee benefits:

The undiscounted amount of short-term employee benefits i.e performance incentive expected to be paid in exchange for the services rendered by employee are recognized during the year when employees render the service.

1.11 Foreign Currency Transactions

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Ex- change differences arising on settlement of short-term foreign currency monetary assets are recognized as income or expense in the statement of Profit and Loss account. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the Profit and Loss Account. The long term investments of the Company in the Joint venture in the UK, are recorded at the foreign exchange prevailing on the date of investments.

2.1 In accordance with Part C of Schedule-II of the Companies Act, 2013 , reassessed the useful lives of Fixed assets. Consequently, the Depreciation on carrying value of the assets whose useful lives expired as 01.04.2014, aggregating Rs.14,68,734/-,have been adjusted against the balance in Surplus of Profit and Loss account as on 01.04.2014.

3.1 *During the financial year 2012-13, Company has taken vehicle loan from ICICI bank for an amount of Rs.15,00,000/- carrying interest @11.25%. The said loan is repayable in 60 monthly equal instalments of Rs.32,499/- each commencing from July 2012. The said loan is secured by charge on same asset on which loan taken.

During March, 2015 company forclosed remaining 27 equal instalments.

4.1 During the year, the company has not recognised the deferred tax asset of Rs.3.59 lakhs, as the effect of the said deferred tax asset is insgnificant.


Mar 31, 2014

A. Basis of preparation of Financial Statements :

- The financial statements have been prepared under historical cost convention on the accrual basis of accounting in accordance with the accounting principles generally accepted in India (GAAP) and in compliance with the Accounting Standards issued by The Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956 as adopted consistently by the company.

- Accounting policies not specifically referred to otherwise are consistent with the generally accepted accounting principles followed by the Company.

- The preparation of financial statements in conformity with the generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

b. Revenue recognition:

- - Revenue from sales in respect of hardware is recognized when they are completed with passing of the title and are exclusive of sales tax, octroi and other incidental expenses.

- Revenue from software development is recognized in accordance with the percentage of completion method and revenue from sale of licenses of software products and other products is recognized on delivery / installation, as the case may be.

- Revenue from IT infrastructure networking, annual service contracts and facilities management services is deferred and recognized ratably over the period of the underlying maintenance agreement.

- Interest Income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

- Dividend Income is recognized when the shareholders'' right to receive payment is established by the Balance Sheet Date.

c. Expenditure:

Expenses are accounted on accrual basis and the provisions are made for all known losses and liabilities. No provisions are made towards likely expenses on providing post-sales client support for fixed priced contracts as well as in respect of annual technical service contracts in so far as it pertains to the period beyond the current accounting year.

d. Fixed Assets and Depreciation :

A. Fixed Assets

- Fixed assets are stated at their original cost of acquisition including incidental expenses related to acquisition & installation of the concerned assets less accumulated depreciation and impairment losses, if any,.

- Costs that are directly associated with identifiable and unique software products controlled by the Company, whether developed in-house or acquired, and have probable economic benefits exceeding the cost are recognized as product development.

- Assets acquired under lease are at cost of acquisition including incidental expenses related to acquisition & installation of such assets.

- Advances paid towards acquisition of fixed assets and the cost of assets not ready for use as at the Balance Sheet date are disclosed under capital work-in-progress.

B. Depreciation /Amortization.

- Depreciation on Software and Computer Systems is provided based on Management''s estimate of useful life of Software/System however subject to maximum period of 6 years. Depreciation on Fixed Assets other than Land and those mentioned above has been provided on Straight Line Method at the following rates:

- Product Development Expenses capitalized are amortized over its useful life for a period not exceeding ten years.

- Leasehold assets are amortized over the period of lease.

- Miscellaneous expenditure is amortized over a period of 5 years from the year in which it has been incurred,

e. Impairment of Assets:

Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Whenever the carrying amount of an asset exceeds its recoverable amount, an impairment loss is recognized in the income statement for items of fixed assets carried at cost. The recoverable amount is higher of an assets net selling price and value in use. The net selling price is the amount obtained from the sale of an asset in an arm''s length transaction while value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset, from its disposal at the end of its useful life.

f. Inventories:

Inventories have been valued on the following basis:

i). Raw Materials, packing material, stores and spares - At cost.

ii). Work-in-progress

At cost plus appropriate allocation of overheads.

iii). Finished Goods

At cost plus appropriate allocation of overheads or net realizable value, whichever is lower

g. Investments:

Investments are classified into current investment and long term investments. Current investments are stated at lower of cost or fair market value. Long Term Investments are stated at cost less provision for permanent diminution in value if any, of investments.

h. Foreign Exchange Transactions :

Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Realized gains and losses on settlement of foreign currency transactions are recognized in the Profit and Loss account. Foreign currency assets and liabilities at the year end are translated at the year end exchange rates and the resultant exchange difference is recognized in the Profit and Loss Account. Exchange differences relating to fixed assets are adjusted in the cost of the respective assets.

i. Research & Development:

1. Revenue expenditure on R&D is charged of to profit & loss account in the year in which it is incurred where the Company is not certain of realizing future economic benefits from such activities.

2. Capital expenditure on R&D is included under the relevant fixed assets.

j. Employee Benefits:

(a) Short Term Employee Benefits

All short term employee benefits such as salaries, wages, bonus, medical benefits which fall due within 12 months of the period in which the employee renders the related services are charged to the profit and loss account.

(b) Long Term & Post- Employment Benefits

(i) Defined Contribution Plan

Company''s contribution paid/payable during the year towards Provident Fund Scheme, ESIC is recognized in the Profit & Loss Account.

(ii) Defined Benefit Plan

The Company''s Gratuity Benefit Scheme is a defined benefit plan. The Company''s liability for gratuity is determined by actuarial valuation made at the end of each financial year using the projected unit credit method. Actuarial gains and Losses are immediately recognized in Profit & Loss Account as income and expense.

k. Borrowing Costs:

Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized as a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the Profit & Loss Account.

I. Deferred tax:

Deferred Income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. The differences that result between the profit considered for income taxes and the profit as per the financial statements are identified, and thereafter a deferred tax asset or deferred tax liability is recorded for timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted or substantially enacted regulations. Deferred tax assets are recognized only if there is reasonable certainty of their realization and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

m. Provision for Tax:

Provision for current tax is determined on the basis of estimated taxable income for the period as per the provisions of Section 115JB Income Tax Act, 1961.

n. Earnings per Share (EPS):

The earnings considered in ascertaining the Company''s EPS are computed as per Accounting Standard 20 on "Earning per Share", issued by the Institute of Chartered Accountants of India. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the period. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless the effect of the potential dilutive equity shares is anti-dilutive.

o. Provision and Contingent Liabilities

Provisions are recognized and computed in accordance with Accounting Standard 29 on "Provisions, Contingent Liabilities and Contingent Assets" issued by the Institute of Chartered Accountants of India i.e. they are recognized if the following conditions are satisfied:

(a) The Company has a present obligation as a result of past event;

(b) It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and

(c) A reliable estimate can be made of the amount of the obligation.

Similarly, the Contingent liabilities are disclosed in Accordance with the Accounting Standard 29 i.e. they are disclosed when the Company has a possible obligation or a present obligation and it is probable that a Cash Outflow will not be required to settle the obligation.

p. Leases

Lease arrangements where the risks and rewards incident to ownership of an asset substantially vest with the lessor, are recognised as operating leases. Lease rentals under operating leases are recognised in the profit and loss account on a straight-line basis over the period of lease.


Mar 31, 2013

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared under the historical cost convention, on the basis of a going concern, with revenue recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amounts, determined as payable or receivable during the year.

1.2 Cash and cash equivalents

Cash comprises cash on hand and fixed deposits with banks. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

1.3 Cash flow statement

Cash flows are reported using the indirect method, whereby profit/(loss) before extraordinary items and 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, investing and financing activities of the Company are segregated based on the available information.

1.4 Fixed Assets

Fixed assets are capitalized at acquisition cost inclusive of freight, installation cost and other incidental expenses incurred during the year.

1.5 Depreciation and amortisation

Depreciation has been provided on the straight-line method as per Section 205(2)(b) of the Companies Act, 1956 at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

1.6 Revenue Recognition

Income from services

Revenues from software related services are accounted for on the basis of services rendered, as per terms of contract.

1.7 Other Income

Interest income is recognized on time proportion basis.

Dividend income on investments is accounted date of the declaration of Dividend.

1.8 Investments

Investments are classified into current investments and long-term investments. Current investments are carried at the lower of cost or fair market value. Any reduction in carrying amount and any reversals of such reduction are charged or credited to the profit and loss account. Long-term investments are carried at cost less provision made to recognize any decline, other than temporary, in the value of such investments.

1.9 Earnings per share (EPS)

The earnings considered in ascertaining the company''s EPS comprises the net profit / loss after tax (And includes the post tax effect of any extraordinary items). The number of shares used in computing Basic EPS is the weighted average number of shares outstanding during the year. The number of shares used in computing Diluted EPS comprises of weighted average shares considered for deriving Basic EPS, and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date.

1.10 Employee Benefits

Defined contribution plans:

Contributions in respect of Employees Provident Fund and Pension Fund are made to a fund administered and managed by the Government of India and are charged as incurred on accrual basis.

Defined benefit plans:

The Company also provides for other employee benefits in the form of gratuity. The Company''s Contributions to Gratuity scheme are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The gratuity fund is managed by the Life Insurance Corporation of India (LIC).

Long-term employee benefits:

The Company also provides to eligible employee benefits in the form of Leave Encashment. The Company''s Contributions are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The Leave encashment fund is managed by the Life Insur- ance Corporation of India (LIC).

Short-term employee benefits:

The undiscounted amount of short-term employee benefits i.e performance incentive expected to be paid in exchange for the services rendered by employee are recognized during the year when employees render the service.

1.11 Foreign Currency Transactions

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Ex- change differences arising on settlement of short-term foreign currency monetary assets are recognized as income or expense in the statement of Profit and Loss account. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the Profit and Loss Account. The long term investments of the Company in the subsidiary in the USA and in the Joint venture in the UK, are recorded at the foreign exchange prevailing on the date of invest- ments.

1.12 Taxes on Income

Although the company has started generating profit, the Deferred Tax Asset / Liability has not recognized based on materiality concept.


Mar 31, 2012

1.1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared under the historical cost convention, on the basis of a going concern, with revenue recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amounts, determined as payable or receivable during the year.

1.2 Cash and cash equivalents

Cash comprises cash on hand and fixed deposits with banks. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

1.3 Cash flow statement

Cash flows are reported using the indirect method, whereby profit/(loss) before extraordinary items and 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, investing and financing activities of the Company are segregated based on the available information.

1.4 Fixed Assets

Fixed assets are capitalized at acquisition cost inclusive of freight, installation cost and other incidental expenses incurred during the year.

1.5 Depreciation and amortization

Depreciation has been provided on the straight-line method as per Section 205(2)(b) of the Companies Act, 1956 at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

1.6 Revenue Recognition

Income from services

Revenues from software related services are accounted for on the basis of services rendered, as per terms of contract.

1.7 Other Income

Interest income is recognized on time proportion basis.

Dividend income on investments is accounted for when the right to receive the payment is established.

1.8 Investments

Investments are classified into current investments and long-term investments. Current investments are carried at the lower of cost or fair market value. Any reduction in carrying amount and any reversals of such reduction are charged or credited to the profit and loss account. Long-term investments are carried at cost less provision made to recognize any decline, other than temporary, in the value of such investments.

1.9 Earnings per share (EPS)

The earnings considered in ascertaining the company's EPS comprises the net profit / loss after tax (And includes the post tax effect of any extraordinary items). The number of shares used in computing Basic EPS is the weighted average number of shares outstanding during the year. The number of shares used in computing Diluted EPS comprises of weighted average shares considered for deriving Basic EPS, and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date.

1.10 Employee Benefits

Defined contribution plans:

Contributions in respect of Employees Provident Fund and Pension Fund are made to a fund administered and managed by the Government of India and are charged as incurred on accrual basis.

Defined benefit plans:

The Company also provides for other employee benefits in the form of gratuity. The Company's Contributions to Gratuity scheme are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The gratuity fund is managed by the Life Insurance Corporation of India (LIC).

Long-term employee benefits:

The Company also provides to eligible employee benefits in the form of Leave Encashment. The Company's Contributions are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The Leave encashment fund is managed by the Life Insurance Corporation of India (LIC).

Short-term employee benefits:

The undiscounted amount of short-term employee benefits i.e. performance incentive expected to be paid in exchange for the services rendered by employee are recognized during the year when employees render the service.

1.11 Foreign Currency Transactions

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Ex- change differences arising on settlement of short-term foreign currency monetary assets are recognized as income or expense in the statement of Profit and Loss account. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the Profit and Loss Account. The long term investments of the Company in the subsidiary in the USA and in the Joint venture in the UK, are recorded at the foreign exchange prevailing on the date of investments.

1.12 Taxes on Income

Although the Company has started generating profit, it is not considered prudent to recognize the Deferred Tax Asset/ Liability due to effect of timing difference at present.


Mar 31, 2011

1. Accounting Convention:

The Accounts have been prepared under the historical cost convention, on the basis of a going concern, with revenue recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amounts, determined as payable or receivable during the year.

2. Fixed Assets:

Fixed assets are capitalized at acquisition cost inclusive of freight, installation cost and other incidental expenses incurred during the year.

3. Depreciation:

The Company provides depreciation on the basis of Straight Line Method as per Section 205(2)(b) of the Companies Act, 1956 at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

4. Revenue Recognition:

Revenues from software related services are accounted for on the basis of services rendered on Cost plus method, as per terms of contract.

Revenues from BPO services are based on the performance of specific criteria at contracted rates.

Dividend income on investments is accounted for when the right to receive the payment is established.

Interest income is recognized on time proportion basis.

5. Investments:

Investments are classified into current investments and long-term investments. Current investments are carried at the lower of cost or fair market value. Any reduction in carrying amount and any reversals of such reduction are charged or credited to the profit and loss account. Long-term investments are carried at cost less provision made to recognize any decline, other than temporary, in the value of such investments.

6. Earnings per share:

The earnings considered in ascertaining the company's EPS comprises the net profit / loss after tax (And includes the post tax effect of any extraordinary items). The number of shares used in computing Basic EPS is the weighted average number of shares outstanding during the year. The number of shares used in computing Diluted EPS comprises of weighted average shares considered for deriving Basic EPS, and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date.

7. Employee Benefits:

(i) Provident Fund:

Contributions in respect of Employees Provident Fund and Pension Fund are made to a fund administered and managed by the Government of India and are charged as incurred on accrual basis.

(ii) Gratuity:

The Company also provides for other employee benefits in the form of gratuity. The Company's Contributions to Gratuity scheme are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account. The gratuity fund is managed by the Life Insurance Corporation of India (LIC).

(Hi) Leave Encashment:

The Company provides for leave encashment based on actual calculations as at the Balance Sheet date.

8. Foreign Currency Transactions:

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the Profit and Loss Account. The long term investments of the Company in the subsidiary in the USA and in the Joint venture in the UK, are recorded at the foreign exchange prevailing on the date of investments.


Mar 31, 2010

1. Accounting Convention:

The Accounts have been prepared under the historical cost convention, on the basis of a going concern, with revenue recognized and expenses accounted on their accrual, including provisions/ adjustments for committed obligations and amounts, determined as payable or receivable during the year.

2. Fixed Assets:

Fixed assets are capitalized at acquisition cost inclusive of freight, installation cost and other incidental expenses incurred during the year.

3. Depreciation:

The Company provides depreciation on the basis of Straight Line Method as per Section 205(2)(b) of the Companies Act, 1956 at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

4. Revenue Recognition:

Revenues from software related services are accounted for on the basis of services rendered on Cost plus method, as per terms of contract.

Revenues from BPO services are based on the performance of specific criteria at contracted rates.

5. Investments:

Investments are classified into current investments and long-term investments. Current investments are carried at the lower of cost or fair market value. Any reduction in carrying amount and any reversals of such reduction are charged or credited to the profit and loss account. Long-term investments are carried at cost less provision made to recognize any decline, other than temporary, in the value of such investments.

6. Earnings per share:

The earnings considered in ascertaining the companys EPS comprises the net profit / loss after tax (And includes the post tax effect of any extraordinary items). The number of shares used in computing Basic EPS is the weighted average number of shares outstanding during the year. The number of shares used in computing Diluted EPS comprises of weighted average shares considered for deriving Basic EPS, and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date.

7. Retirement Benefits:

(i) The Companys Contributions to Provident Fund have been paid to Governments provident fund and charged as expenditure to Profit & Loss account.

(ii) The Companys Contributions to Gratuity scheme are determined by actuarial valuation and have been made to an approved Fund and the same is charged as expenditure to Profit & Loss account.

8. Foreign Currency Transactions:

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the Profit and Loss Account.

 
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