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Accounting Policies of SFL International Ltd. Company

Mar 31, 2014

1. BASIS OF PREPARATION OF FINANCIAL STATEMENT

Financial Statements have been prepared under historical cost convention on accrual basis, in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 1956. All income and Expenditure having a material bearing on the Financial Statement are recognized on accrual basis,

2. USE OF ESTIMATES

The preparation of Financial Statement in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported accounts of Assets and liabilities and disclosure of contingent liabilities on the date of the financial statements, Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods,

3. INVENTORY:

The dosing stock of shares is valued at cost.

4. CASH FLOW STATEMENT

(a) Cash & Cash Equivalents (for the purpose of cash flow statement)

Cash Comprises cash on hand and demand deposits with banks. Cash Equivalents are short-term balances (with original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

(b) 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,

5. FIXED ASSETS & DEPRECIATION:

(a) Gross block of Fixed Assets including leased assets are valued at historical cost.

(b) Depreciation on all assets is provided on straight Line Basis as per section 205(2)(b) of the Companies Act, 1956 at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 as amended from time to time. The Depreciation is calculated on a pro rata basis from the date on which the assets is purchased/ brought to use which-ever is later.

6 REVENUE RECOGNITION

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

(a) Dividend on investments is recognized when the right to receive is to be established,

(b) Interest income is recognized on time proportion basis taking into account the amount outstanding and the rate applicable.

(e) Revenue in respect of other Income is recognized when no significant uncertainty as to its determination or realization exists.

7. INVESTMENTS

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. Ail other investments are classified as long term investments. Long term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management. Current investments are carried at the lower of cost and quoted / fair value, computed category wise,

8. BORROWING COST

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are charged to statement of Profit & Loss,

9. RELATED PARTY TRANSACTIONS

Disclosure of transactions with related parties, as required by Accounting Standard 18 - "Related Party Disclosure" as specified in Companies (Accounting Standards) Rules, 2006 fas amended), have been set out in a separate note forming part of the financial statements. Related party as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by key managerial personnel and information available with the company.

10. EARNING PER SHARE:

The Company reports basic and diluted earning per share (EPS) on accordance with the Accounting Standard 20 as specified in Companies (Accounting Standards) Rules, 2006 (as amended), The Basic EPS has been computed by dividing the income available to Equity Shareholders by the Weighted Average number of Equity Shares outstanding during the accounting year. The diluted EPS has been computed using the weighted average number of Equity shares and dilutive potential Equity shares outstanding at the end of the year.

11. TAXES ON INCOME Deferred Taxation

In accordance with the Accounting Standard 22 - Accounting for Taxes on Income, as specified in the Companies (Accounting Standard) Rules, 2006 (as amended), the deferred tax for timing difference between the book and the income tax profit for the year is accounted for by using the tax rate and laws that has been enacted and substantively enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognized to the extent there is a virtual certainty that the assets can be realized in future.

Net outstanding balance in deferred tax account is recognized as deferred tax liability/assets. The deferred tax account is used solely for reversing timing difference as and when crystallized.

Current taxation

Provision for taxation has been made in accordance with the income tax laws prevailing for the relevant assessment year.

12. IMPAIRMENT OF FIXED ASSETS

The carrying amount of assets, other than inventories, is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indications exist, the asset recoverable amount is estimated.

The impairment loss is recognized whenever the carrying cost amount of an asset or its cash generation unit exceed its recoverable amount. The recoverable amount is the greater of the asset net selling price and value in the use which is determined based on the estimated future cash flow discounted to the present value all impairment losses are recognize in the profit and loss account.

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and it is recognized in the profit and loss account,

13. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurements are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2010

A. BASIS OF ACCOUNTING POLICY

(i) Financial Statements have been prepared under historical cost.

(ii) The Company follows accrual method of accounting.

B. FIXED ASSETS & DEPRECIATION:

a) Cross block of Fixed Assets including leased assets are valued at historical cost.

b) Depreciation on all assets is provided on straight Line Basis as per section 205(2)(b) of the Companies Act. 1 956 at the rates and in the manner specified in schedule XIV of the Companies Act. 1956 as amended from time to time. The Depreciation is calculated on a pro rata basis from the date on which the assets is purchased/brought to use which ever is letter. No depreciation is provided on the assets which were not used during the year.

C. INVESTMENTS :

Investments are valued at their acquisition cost. Diminution in the value of long term investment has not been accounted for.

D. INVENTORY :

The closing stocks of shares are valued at cost.

E. AMORTISATION OF MISCELLANEOUS EXPENDITURE :

Preliminary expenses and share issue expenses are deferred to be amortized over a period of ten years.

F. EARNING PER SHARE :

The Company reports basic and diluted earning per share (EPS) on accordance with the Accounting Standard 20 issued by the Institute of Chartered Accountant of India. The Basic EPS has been computed by dividing the income available to Equity Shareholders by the Weighted Average number of Equity Shares outstanding during the accounting year. The diluted EPS has been computed using the weighted average number of Equity shares and dilutive potential Equity shares outstanding at the end of the year.

G. IMPAIRMENT OF FIXED ASSETS :

The carrying amount of assets, other than inventories, is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated.

The impairment loss is recognized whenever the carrying amount of an asset or its cash generation unit exceeds its recoverable amount. The recoverable amount is the greater of the asset's net selling price and value in the uses which is determined based on the estimated future cash flow discounted to their present values. All impairment losses are recognized in the profit and loss account.

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and is recognized in the profit and loss account.

H. Related Party Transactions :

Disclosure of transaction with related parties, as required by Accounting Standard 18 "RELATED PARTY DISCLOSURES" has been set out in a separate note forming part of the schedule. Related Party as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by Key Managerial Personnel and information available with the company.

I. CASH FLOW STATEMENT :

The cash flow statement is feeing prepared as per Accounting standard - 3 prescribed by the Institute of Chartered Accountants of India.