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Accounting Policies of Sterling Guaranty & Finance Ltd. Company

Mar 31, 2014

A) The Company follows the accrual system of accounting unless stated otherwise.

b) Basis of Preparation of Financial Statements:

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

c) Use of Estimates:

The presentation of financial statements requires estimates and assumptions to be made that effect the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenue and expenses during the reporting period. Difference between the actual results and estimates are recognized In the period In which the results are known / materialised.

d) Income Recognition:

The Company''s Income from operations Is accounted for on accrual basis.

e) Expenses

All crystalised claimed expenses are provided for on accrual basis.

f) Valuation:

(I) Stock of Trading Securities are classified Into current and long term Investments. Current Investments are valued scripwise under each category at cost or market value whichever is lower. Long term Investments are valued at cost. The provision for diminution In value of long term Investments has been made If In the opinion of Board of Directors of the Company there Is a permanent decline In value of Investments.

(II) Market value of Trading Securities (Current Investments) Is determined as under:

- Quoted securities are taken at highest year end closing market rates prevailing at the principal exchanges where they are traded.

- The Rights entitlements for shares/debentures are taken at the year end closing market rates applicable for relevant shares / debentures less uncalled liability, If any.

- Unquoted Securities are taken at cost or break up value whichever Is lower.

- Traded Government Securities are taken on the basis of NSE quotations and non-traded Government securities are taken on the basis of prevailing YTM.

(III) Stock of Derivatives are valued at MTM taken by the exchange at year end.

They are treated as Trading Securities In the books. Profit or loss of the same are accounted as and when they are settled or squared up.

g) Depreciation:

i. The Company has been providing depreciation for own assets on Straight line-Pro-rata basis at the rate specified In Schedule XIV of the Companies Act, 1956.

ii. In terms of Guidance Note on Accounting for lease issued by Institute of Chartered Accountants of India, depreciation on assets given on lease is provided in manner such that the cost of such asset is written off over the primary lease period In proportion to lease rentals accrued during the Year.

h) Borrowing Costs:

Borrowing costs, which are directly attributable to the acquisition/ construction of fixed assets, till the time such assets are ready for intended use, are capitalized as part of the cost of the assets. Other borrowing costs are recognized as an expenses in the year in which they are incurred.

i) Provision for Bad & doubtful Debts is made based on the RBI guidelines to Non-Banking Financial Companies Prudential Norms.

j) The payment of gratuity to employee is accounted on cash basis.

k) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. Provision for income tax is made on the basis of estimated taxable income for the year.

Deferred Tax resulting from the timing difference between book and tax profit is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystalise.


Mar 31, 2013

A) The Company follows the accrual system of accounting unless stated otherwise.

b) Basis of Preparation of Financial Statements:

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

c) Use of Estimates:

The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenue and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialised.

d) Income Recognition:

The Company''s income from operations is accounted for on accrual basis.

e) Expenses:

All crystallized claimed expenses are provided for on accrual basis.

f) Valuation:

(i) Stock of Trading Securities are classified into current and long term Investments. Current Investments are valued scripwise under each category at cost or market value whichever is lower. Long term Investments are valued at cost. The provision for diminution in value of long term investments has been made if in the opinion of Board of Directors of the Company there is a permanent decline in value of investments.

(ii) Market value of Trading Securities (Current investments) is determined as under:

Quoted securities are taken at highest year end closing market rates prevailing at the principal Exchanges where they are traded.

The Rights entitlements for shares/debentures are taken at the year end closing market rates as applicable for relevant shares / debentures less uncalled liability, if any.

Unquoted Securities are taken at cost or break up value whichever is lower.

Traded Government Securities are taken on the basis of NSE quotations and non-traded Government securities are taken on the basis of prevailing YTM.

(iii) Stock of Derivatives are valued at MTM taken by the exchange at year end. They are treated as Trading Securities in the books. Profit or loss of the same is accounted as and when they are settled or squared up.

g) Depreciation:

i The Company has been providing depreciation for own assets on Straight line-Pro-rata basis at the rate specified in Schedule XIV of the Companies Act, 1956.

ii In terms of Guidance Note on Accounting for lease issued by Institute of Chartered Accountants of India, depreciation on assets given on lease is provided in manner such that the cost of such asset is written off over the primary lease period in proportion to lease rentals accrued during the Year.

h) Borrowing Costs:

Borrowing costs, which are directly attributable to the acquisition/ construction of fixed assets, till the time such assets are ready for intended use, are capitalized as part of the cost of the assets. Other borrowing costs are recognized as an expenses in the year in which they are incurred..

i) Provision for Bad & doubtful Debts is made based on the RBI guidelines to Non-Banking Financial Companies Prudential Norms.

j) The payment of gratuity to employee is accounted on cash basis.

k) Taxation:

Income tax expenses comprises current tax and deferred tax charge or credit. Provision for income tax is made on the basis of estimated taxable income for the year.

Deferred Tax resulting from the timing difference between book and tax profit is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystalise.


Mar 31, 2012

A) The Company follows the accrual system of accounting unless stated otherwise.

b) Basis of Preparation of Financial Statements:

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

c) Use of Estimates:

The presentation of financial statements requires estimates and assumptions to be made that effect the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenue and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialised.

d) Income Recognition:

The Company''s income from operations is accounted for on accrual basis.

e) Expenses

All crystalised claimed expenses are provided for on accrual basis.

f) Valuation:

(i) Stock of Trading Securities are classified into current and long term Investments. Current Investments are valued scripwise under each category at cost or market value whichever is lower. Long term Investments are valued at cost. The provision for diminution in value of long term investments has been made if in the opinion of Board of Directors of the Company there is a permanent decline in value of investments.

(ii) Market value of Trading Securities (Current investments) is determined as under:

- Quoted securities are taken at highest year end closing market rates prevailing at the principal exchanges where they are traded

- The Rights entitlements for shares/debentures are taken at the year end closing market rates applicable for relevant shares / debentures less uncalled liability, if any.

- Unquoted Securities are taken at cost or break up value whichever is lower.

- Traded Government Securities are taken on the basis of NSE quotations and non-traded Government securities are taken on the basis of prevailing YTM.

(iii) Stock of Derivatives are valued at MTM taken by the exchange at year end.

They are treated as Trading Securities in the books. Profit or loss of the same are accounted as and when they are settled or squared up.

g) Depreciation:

i The Company has been providing depreciation for own assets on Straight line-Pro-rata basis at the rate specified in Schedule XIV of the Companies Act, 1956.

ii In terms of Guidance Note on Accounting for lease issued by Institute of Chartered Accountants of India, depreciation on assets given on lease is provided in manner such that the cost of such asset is written off over the primary lease period in proportion to lease rentals accrued during the Year.

h) Borrowing Costs:

Borrowing costs, which are directly attributable to the acquisition/ construction of fixed assets, till the time such assets are ready for intended use, are capitalized as part of the cost of the assets. Other borrowing costs are recognized as an expenses in the year in which they are incurred.

i) Provision for Bad & doubtful Debts is made based on the RBI guidelines to Non-Banking Financial Companies Prudential Norms.

j) The payment of gratuity to employee is accounted on cash basis.

k) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. Provision for income tax is made on the basis of estimated taxable income for the year.

Deferred Tax resulting from the timing difference between book and tax profit is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystalise.


Mar 31, 2011

A) The Company follows the accrual system of accounting unless stated otherwise.

b) Basis of Preparation of Financial Statements:

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

c) Use of Estimates:

The presentation of financial statements requires estimates and assumptions to be made that effect the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenue and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialised.

d) Income Recognition:

The Company's income from operations is accounted for on accrual basis.

e) Expenses

All crystalised claimed expenses are provided for on accrual basis.

f) Valuation:

(i) Stock of Trading Securities are classified into current and long term Investments. Current Investments are valued scripwise under each category at cost or market value whichever is lower. Long term Investments are valued at cost. The provision for diminution in value of long term investments has been made if in the opinion of Board of Directors of the Company there is a permanent decline in value of investments.

(ii) Market value of Trading Securities (Current investments) is determined as under:

- Quoted securities are taken at highest year end closing market rates prevailing at the principal exchanges where they are traded

- The Rights entitlements for shares/debentures are taken at the year end closing market rates applicable for relevant shares / debentures less uncalled liability, if any.

- Unquoted Securities are taken at cost or break up value whichever is lower.

- Traded Government Securities are taken on the basis of NSE quotations and non- traded Government securities are taken on the basis of prevailing YTM.

(iii) Stock of Derivatives are valued at MTM taken by the exchange at year end.

They are treated as Trading Securities in the books. Profit or loss of the same are accounted as and when they are settled or squared up.

g) Depreciation:

i The Company has been providing depreciation for own assets on Straight line-Pro-rata basis at the rate specified in Schedule XIV of the Companies Act, 1956.

ii In terms of Guidance Note on Accounting for lease issued by Institute of Chartered Accountants of India, depreciation on assets given on lease is provided in manner such that the cost of such asset is written off over the primary lease period in proportion to lease rentals accrued during the Year.

h) Borrowing Costs:

Borrowing costs, which are directly attributable to the acquisition/ construction of fixed assets, till the time such assets are ready for intended use, are capitalized as part of the cost of the assets. Other borrowing costs are recognized as an expenses in the year in which they are incurred.

i) Provision for Bad & doubtful Debts is made based on the RBI guidelines to Non- Banking Financial Companies Prudential Norms.

j) The payment of gratuity to employee is accounted on cash basis.

k) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. Provision for income tax is made on the basis of estimated taxable income for the year.

Deferred Tax resulting from the timing difference between book and tax profit is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystalise.


Mar 31, 2010

A) The Company follows the accrual system of accounting unless stated otherwise.

b) Basis of Preparation of Financial Statements:

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

c) Use of Estimates:

The presentation of financial statements requires estimates and assumptions to be made that effect the reported amount of assets and liabilities on the date of financial statements and the reported amount oi revenue and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialised.

d) Income Recognition:

The Companys income from operations is accounted for on accrual basis.

e) Expenses

All crystalised claimed expenses are provided for on accrual basis.

f) Valuation:

(i) Stock of Trading Securities are classified into current and long term Investments. Currer Investments are valued scripwise under each category at cost or market value whichever lower. Long term Investments are valued at cost. The provision for diminution in value of long ten investments has been made if in the opinion of Board of Directors of the Company there is permanent decline in value of investments.

(ii) Market value of Trading Securities (Current investments) is determined as under:

- Quoted securities are taken at highest year end closing market rates prevailing at the principa exchanges where they are traded

- The Rights entitlements for shares/debentures are taken at the year end closing market rates applicable for relevant shares / debentures less uncalled liability, if any.

- Unquoted Securities are taken at cost or break up value whichever is lower.

- Traded Government Securities are taken on the basis of NSE quotations and non-traded Government securities are taken on the basis of prevailing YTM.

(iii) Stock of Derivatives are valued at MTM taken by the exchange at year end.

They are treated as Trading Securities in the books. Profit or loss of the same are accounted as and when they are settled or squared up.

g) Depreciation:

i The Company has been providing depreciation for own assets on Straight line-Pro-rata basis at the rate specified in Schedule XIV of the Companies Act, 1956.

ii In terms of Guidance Note on Accounting for lease issued by Institute of Chartered Accountants of India, depreciation on assets given on lease is provided in manner such that the cost of such asset is written off over the primary lease period in proportion to lease rentals accrued during the Year.

h) Borrowing Costs:

Borrowing costs, which are directly attributable to the acquisition/ construction of fixed assets, till the time such assets are ready for intended use, are capitalized as part of the cost of the assets. Other borrowing costs are recognized as an expenses in the year in which they are incurred.

i) Provision for Bad & doubtful Debts is made based on the RBI guidelines to Non-Bankinj Financial Companies Prudential Norms.

j) The payment of gratuity to employee is accounted on cash basis.

k) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. Provision for income tax is made on the basis of estimated taxable income for the year.

Deferred Tax resulting from the timing difference between book and tax profit is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystalise.

 
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