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Accounting Policies of Sparc Systems Ltd. Company

Mar 31, 2014

A. Basis & Method of Accounting

The financial statements have been prepared on accrual basis under historical cost convention in accordance with generally accepted accounting principles in India and the provision of the Companies Act,1956.

b. Use of Estimates

The preparation of financial statements is conformity with generally accepted accounting principles requires the management to make estimates and assumptions that effects the reported balances of assets and liabilities as of the date of financial statement and reported amount of income and expenses during the period management believe that the estimates used in the preparation of financial statements are prudent and reasonable. Actual results could differ from the Estimates.

c. Fixed Assets

Fixed Assets are stated at cost of acquisition or construction inclusive of capitalization of all costs incurred till the commencement of commercial production.

d. Impairment of Assets

The carrying amount of assets are reviewed at each Balance Sheet date, if there is any indication of impairment based on internal / external factors. An asset is impaired when the carrying amount of the asset exceed the recoverable amount. An impairment loss is charged to the Statement of Profit and Loss in the year in which the asset is identified as being impaired.

e. Depreciation

The depreciation on Fixed Assets is provided on straight line method, in accordance with the Schedule XIV to the Companies Act, 1956. The depreciation on Assets added during the year has been provided on pro-rata basis with reference to the date on which the assets were put to use. No depreciation has been provided on the fixed assets, which have not been put to use during the year.

f. Revenue recognition

Sales represent invoice value of goods supplied and service rendered, including Sales Tax applicable and are net of rate difference and goods returned.

g. Inventories

Inventories are valued at cost or net realizable value whichever is lower. The cost is worked out on weighted average basis.

h. Research and Development Expenses

Expenditure relating to capital items is debited to fixed assets and depreciated at applicable rates. Revenue expenses are charged to the Statement of Profit & Loss of the year.

i. Retirement Benefits

Retirement benefits are given as per term & condition of contract with employee. Short term employee''s benefits are recognized at the undiscounted amount in the profit and loss account.

j. Taxation

Income-tax expenses comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are recognized, only if there is a virtual certainty of its realization, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized only to the extent there is a reasonable certainty of its realization. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realization.

k. Earning per Share

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.

l. Segment Reporting

The Company is engaged in the Office Automation and Security Systems and Services thereof being a single segment hence disclosure as requirements of Accounting Standard AS-17 issued by the Institute of Chartered Accountants of India is not applicable.

m. Other Accounting policies

These are consistent with generally accepted accounting practices.

(b) Term & right attached to Equity Shares

The Company has only one class of Equity Shares having a par value of Rs.10/- per share. Each holder of Equity Share is entitled to one vote per share. In the event of liquidation, a shareholder will be entitled to receive remaining assets of the Company after distribution of all preferential amount. The distribution will be in proportion to the Equity Share held by the share holder.


Mar 31, 2010

A. Basis & Method of Accounting

The financial statements have been prepared on accrual basis under historical cost convention in accordance with generally accepted accounting principles in India and the prfovision of the Companies Act,1956.

b. Use of Estimates

The preparation of financial statements is conformity with generally accepted accounting principles requires the management to make estimates and assumptions that effects the reported balances of assets and liabilities as of the date of financial statement and reported amount of income and expenses during the period management believe that the estimates used in the preparation of financial statements are prudent and reasonable. Actual results could differ from the estimates.

c. Fixed Assets

Fixed Assets are stated at cost of acquisition or construction inclusive of capitalization of all costs incurred till the commencement of commercial production.

d. Impairment of Assets

The carrying amount of assets are reviewed at each Balance Sheet date, if there is any indication of impairment based on internal / external factors. An asset is impaired when the carrying amount of the asset exceed the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which the asset is identified as being impaired.

e. Depreciation

The depreciation on Fixed Assets is provided on straight line method, in accordance with the Schedule XIV to the Companies Act, 1956. The depreciation on Assets added during the year has been provided on pro- rata basis with reference to the date on which the assets were put to use. No depreciation has been provided on the fixed assets, which have not been put to use during the year.

f. Investments

The long term investments (unquoted) are stated at cost. The income from investments is accounted for when received.

g. Revenue recognition

Sales represent invoice value of goods supplied and service rendered, including Sales Tax applicable and are net of rate difference and goods returned.

h. Inventories

Inventories are valued at cost or net realizable value whichever is lower. The cost is worked out on weighted average basis.

i. Research and Development Expenses

Expenditure relating to capital items is debited to fixed assets and depreciated at applicable rates. Revenue expenses are charged to Profit & Loss Account of the year.

j. Retirement Benefits

No provisions has been made for payment of gratuity since it is not yet applicable. Leave encashment benefits have been charged to Profit & Loss Account.

k. Borrowing Cost

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

I. Taxation

Income-tax expenses comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are recognized, only if there is a virtual certainty of its realization, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized only to the extent there is a reasonable certainty of its realization. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realization.

m. Earning per share

The earnings considered in ascertaining the Companys EPS are computed as per Accounting Standard 2C on "Earning Per Share", issued by the Institute of Chartered Accountants of India. The number of share: 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.

n. Segment Reporting

The Company is engaged in the Office automation and security system and services thereof being a singment segment hence disclosure as requirements of Accounting Standard AS-17 issued by the Institute o Chartered Accountants of India is not applicable.

o. Miscellaneous Expenditure

There is no miscellaneous expenditure for the year.

p. Other Accounting policies

These are consistent with generally accepted accounting practices.

 
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