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Accounting Policies of Talwalkars Better Value Fitness Ltd. Company

Mar 31, 2015

(a) Basis of preparation of financial statements:

* The financial statements of the Company are prepared in accordance with Generally Accepted Accounting Principles in India ('Indian GAAP') under the historical cost convention on an accrual basis. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

* The amounts in the accompanying financial statements have been stated in millions of Indian rupees and rounded off to two decimals.

Use of Estimates:

* The preparation of financial statements in conformity with Indian GAAP requires management to make judgements, estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as at the date of the financial statements. These estimates are based upon management's best knowledge of current events and actions. The difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

(b) Fixed assets:

* Tangible fixed assets are stated at original cost, net of tax/duty credits availed if any, less accumulated depreciation / amortization. Costs include all expenses incurred to bring the assets to its present location and condition. Assets acquired by way of slump sale are recorded at book value in the books of the transferor as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial activity are treated as part of the fixed assets and capitalized.

* Intangible assets are recorded at the consideration paid for acquisition and are carried at cost less accumulated amortization.

(c) Depreciation/Amortization:

* Depreciation on all the fixed assets is provided pro-rata from / up to the date of acquisition / disposal using the straight line method in line with the useful lives prescribed by Schedule II to the Companies Act, 2013 from 01.04.2014.

* The Company has reviewed the useful life of the fixed assets based on Schedule II to the Companies Act, 2013. Consequently depreciation charge for the year is higher and profit before tax so is lesser to that extent.

* In case of Goodwill, the amount is amortized @4.75% p.a. using the straight-line method.

(d) Provisions, Contingent Liabilities and Contingent Assets:

* Provisions involving substantial degree of estimation in measurement are recognized if there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of obligation can be reliably estimated.

* Contingent Liabilities are not recognized in the financial statements but are disclosed in the notes to accounts. Contingent Assets are neither recognized nor disclosed in the financial statements.

(e) Revenue Recognition:

* Income from fees and subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the fees receivable from existing members as at the end of the year has been recognised as income for the year.

* The costs relating to rendering of these services being unascertainable are charged off to revenue in the year in which they become legally payable.

* Input credit availed on service tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which service tax is paid in subsequent year are booked net of the un-availed service tax at end of the year.

* Income by way of franchisee fees (including up-front fees) received pursuant to franchisee agreements entered, are recognized as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

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

* Any other income i.e. from juice bar sales, consumables etc. are recognised on receipt basis since the realizations there from are immediate and no credit is allowed to the customers / members.

(f) Impairment of Assets:

* The management periodically assesses using, external and internal sources, whether there is an indication that an asset may be impaired.

* An impairment loss is charged to the Statement of Profit and Loss in the year in which the asset is identified as impaired.

* At each balance sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss.

* The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

(g) Employee benefits:

* All employee benefits payable wholly within twelve months of rendering the service are classified as a short term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc. is recognized in the period in which the employee/contractual labour renders the related service.

* The gratuity liability is provided and charged off as revenue expenditure based on the actuarial valuation. The company has subscribed to the group gratuity scheme policy of LIC of India.

* Any other payments under the relevant labour statutes, wherever applicable, are reimbursed to the Outsourced Agency as and when applicable.

(h) Borrowing Cost:

* Borrowing cost incurred for qualifying assets is capitalized up to the date; the asset is ready for intended use, based on borrowings incurred specifically for financing the asset. In determining the amount of borrowing cost eligible for capitalization during a period, any income earned on the temporary investment on those borrowings is deducted from the borrowing cost incurred.

* Other Borrowing costs are charged off as revenue expenditure in the year in which they are incurred.

(i) Foreign Currency Transactions:

* Foreign Currency Transactions are recorded on initial recognition in the reporting currency, using the exchange rate on the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing rate.

* Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company's monetary items at the closing rate are:

i. Upto 31st March 2008, recognized as an income or expense in the period in which they arise and

ii. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(j) Earnings Per Share:

Basic Earnings Per Share

* Basic earnings per share is computed by dividing the net profit or loss for the year attributable to equity shareholders, by weighted average number of equity shares outstanding during the year.

Diluted Earnings Per Share

* For the purpose of calculating Diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

(k) Taxes on Income:

* Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

* Deferred Taxation is recognized for all timing differences between accounting income and taxable income and is quantified using enacted / substantial enacted tax rates as at balance sheet date. Deferred Tax asset are recognized subject to the management's judgement that the realization is virtually / reasonably certain.

* Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961, based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each balance sheet date.

(l) Cash Flow Statement:

* The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS)3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

* Cash and cash equivalents presented in the Cash Flow Statement consists of cash on hand, balances in Current, Fixed deposit and Cash Credit Accounts with Bank.

(m) Investments:

* Long term Investments are stated at cost, less provision for other than temporary diminution in value. Current investments comprising investments in Mutual Funds are stated at the lower of cost and fair value determined on an individual investment basis.

(n) Inventories:

* Inventories of stock-in-trade are valued at lower of cost and net realizable value.

(o) Debenture Redemption Reserve:

* Transfer to Debenture Redemption Reserve is made in terms of requirement of Circular No.04/2013 dated 1 1/02/2013 issued by the Ministry of Corporate Affairs.

(p) Leases:

* Assets taken on lease by the Group in its capacity as lessee, where the Group has substantially all the risks and rewards of ownership are classified as finance lease. Such leases are capitalized at the inception of the lease at lower of fair value or the present value of the minimum lease payments and a liability is recognized for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant rate of interest on the outstanding liability for each year.

* Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vests with the lessor, are recognized as operating lease. Lease rentals under operating lease are recognized in the Statement of Profit and Loss.


Mar 31, 2014

(a) Basis of preparation of financial statements:

- The financial statements of the Company are prepared in accordance with Generally Accepted Accounting Principles in India ("Indian GAAP") under the historical cost convention on an accrual basis. The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

- All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in Revised Schedule VI to the Companies Act, 1956. The Company has ascertained its operating cycle as 12 months for the purpose of such classification.

- The amounts in the accompanying financial statements have been stated in millions of Indian rupees rounded off to two decimals. Use of Estimates:

- The preparation of financial statements in conformity with Indian GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as at the date of the financial statements. These estimates are based upon management''s best knowledge of current events and actions. The difference between the actual results and estimates are recognized in the period in which the results are known / materialised.

(b) Fixed assets :

- Tangible fixed assets are stated at original cost, net of tax/duty credits availed if any, less accumulated depreciation/amortisation. Costs include all expenses incurred to bring the assets to its present location and condition. Assets acquired byway of slump sale are recorded at bookvalue in the books of the transferor as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial activity are treated as part of the fixed assets and capitalised.

- Intangible assets are recorded at the consideration paid for acquisition and are carried at cost less accumulated amortisation.

(c) Depreciation/Amortisation :

- Depreciation on all fixed assets is provided pro-rata from/ up to the date of acquisition / disposal using the straight line method at the rates prescribed by schedule XIV of the Companies Act, 1956. However, in respect of the following asset categories the depreciation is provided at higher rates in linewith their revised estimated useful life with effect from 01.04.2013.

- In case of Goodwill, the amount is amortized @4.75% p.a. using the straight-line method.

(d) Provisions, Contingent Liabilities and Contingent Assets:

- Provisions involving substantial degree of estimation in measurement are recognized if there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of obligation can be reliably estimated.

- Contingent Liabilities are not recognized in the financial statements but are disclosed in the notes to accounts. Contingent Assets are neither recognized nor disclosed in the financial statements.

(e) Revenue Recognition:

- Income from fees and subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the fees receivable from existing members as at the end of the year has been recognised as income for the year.

- The costs relating to rendering of these services being unascertainableare charged off to revenue in the year in which they become legally payable.

- Input credit availed on service tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which service tax is paid in subsequent year are booked net of the un-availed service tax at end of the year.

- Income by way of franchisee fees (including up-front fees) received pursuant to franchisee agreements entered, are recognised as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

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

- Any other income i.e. from juice bar sales, consumables etc. are recognised on receipt basis since the realisations there-from are immediate and no credit is allowed to the customers/ members.

Significant accounting policies and notes to the Financial Statements

for the year ended 31st March, 2014

(f) Impairment of Assets:

- The management periodically assesses using, external and internal sources, whether there is an indication that an asset may be impaired.

- An impairment loss is charged to the Statement of Profit and Loss in the year in which the asset is identified as impaired.

- At each balance sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss.

- The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

(g) Employee benefits:

- All employee benefits payable wholly within twelve months of rendering the service are classified as a short term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc. is recognised in the period in which the employee/ contractual labour renders the related service.

- The gratuity liability is provided and charged off as revenue expenditure based on the actuarial valuation. The company has subscribed to the group gratuity scheme policy of LIC of India.

- Any other payments under the relevant labour statutes, wherever applicable, are reimbursed to the outsourced agency as and when applicable. (h) Borrowing Cost:

- Borrowing cost incurred for qualifying assets is capitalised up to the date; the asset is ready for intended use, based on borrowings incurred specifically for financing the asset. In determining the amount of borrowing cost eligible for capitalisation during a period, any income earned on the temporary investment on those borrowings is deducted from the borrowing cost incurred.

- Other Borrowing costs are charged off as revenue expenditure in the year in which they are incurred. (i) Foreign Currency Transactions:

- Foreign Currency Transactions are recorded on initial recognition in the reporting currency, using the exchange rate on the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing rate.

- Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company''s monetary items at the closing rate are:

i. Upto 31st March 2008, recognised as an income or expense in the period in which they arise and

ii. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(j) Earnings Per Share:

Basic Earnings Per Share

- Basic earnings per share is computed by dividing the net profit or loss for the year attributable to equity shareholders, by weighted average number of equity shares outstanding during the year.

Diluted Earnings Per share

- For the purpose of calculating Diluted Earnings Per Share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

(k) Taxes on Income:

- Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1 961.

- Deferred Taxation is recognised for all timing differences between accounting income and taxable income and is quantified using enacted / substantial enacted tax rates as at balance sheet date. Deferred Tax asset are recognised subject to the management''s judgement that the realisation is virtually/ reasonably certain.

- Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 11 5JAA of the Income Tax Act, 1 961, based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each balance sheet date.

(I) Cash Flow Statement:

- The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS)3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

- Cash and cash equivalents presented in the Cash Flow Statement consists of cash on hand, balances in Current, Fixed deposit and Cash Credit Accounts with Bank.

(m) Investments:

- Long term Investments are stated at cost, less provision for other than temporary diminution in value. Current investments comprising investments in Mutual Funds are stated at the lower of cost and fair value determined on an individual investment basis.

Significant accounting policies and notes to the Financial Statements

for the year ended 31 st March, 2014 (n) Inventories :

- Inventories of stock-in-trade are valued at lower of cost and net realisable value. (o) Debenture Redemption Reserve:

- Transfer to Debenture Redemption Reserve is made in terms of requirement of Circular No. 04/2013 dated 11/02/201 3 issued by the Ministry of Corporate Affairs.

(p) Leases:

- Assets taken on lease by the Group in its capacity as lessee, where the Group has substantially all the risks and rewards of ownership are classified as finance lease. Such leases are capitalized at the inception of the lease at lower of fair value or the present value of the minimum lease payments and a liability is recognized for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant rate of interest on the outstanding liability for each year.

- Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vests with the lessor, are recognised as operating lease. Lease rentals under operating lease are recognised in the Statement of Profit and Loss.

(i) Terms/ Rights attached to Equity Shares

(a) The Company has only one class of share capital namely Equity Shares having a face value of Rs.1 0 per share.

(b) In respect of every Equity Share (Whether fully paid or partly paid).voting right shall be in the same proportion as the capital paid up on such Equity Share bears to the total paid up Equity capital of the Company.

(c) The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend.

(d) In the event of liquidation, the shareholders of Equity Shares are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholdings.

(ii) Reconciliation of Number of Equity Shares and Share Capital

b) All loans are sanctioned by Union Bank of India are secured primarily against the first hypothecation / mortgage charge on the entire movable and immovable Fixed Assets & Current Assets of the Company including Gymnasium Equipments, Furniture & Fixtures and any other equipment installed in the Gymnasiums, equitable mortgage of immovable premises of the Company, corporate guarantee and collateral security by way of equitable mortgage of premises situated at Tardeo and Mahalaxmi, Mumbai of third parties and the personal guarantee of three Directors of the Company. (Amount repayable in the next 1 2 months Rs.272.07 million, Previous year Rs.241.40 million)

Notes:

a) Acceptances by Union Bank of India are secured primarily against the first hypothecation/ mortgage charge on the entire movable and immovable Fixed Assets & Current Assets of the Company including Gymnasium Equipments, Furniture & Fixtures and any other equipment installed in the Gymnasiums, equitable mortgage of immovable premises of the Company, corporate guarantee and collateral security by way of equitable mortgage of premises situated at Tardeo and Mahalaxmi, Mumbai of third parties and the personal guarantee of three Directors of the Company.

b) Refundable security deposit from Franchisee of Rs. 0.5 millions

Note:

(a) All employee benefits payable wholly within twelve months of rendering the service are classified as a short term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc is recognized in the period in which the employee/contractual labour renders the related service.

The gratuity liability is provided and charged off as revenue expenditure based on actuarial valuation. The Company has subscribed to the group gratuity scheme policy of LIC of India.

Any other payments under the relevant labour statutes, wherever applicable are reimbursed to the Out sourced Agency as and when applicable.

Disclosure pursuant to Accounting Standard (AS) 1 5 (Revised):

The Company''s liability towards Gratuity as per provision of Accounting Standard (AS) 1 5 (Revised) on the basis of actuarial valuation has been covered by a LIC Group Gratuity Scheme. The Company does not allow carryforward of compensated absences to employees. Accordingly, no provision has been made for compensated absences.

B. The employees long term benefits like Gratuity, Ex-Gratia and other terminal benefits are valued on actuarial basis and recognised in the statement of profit and loss. The assumption in the actuarial valuation of the gratuity provision is as under:

i) Nature of Gratuity- Gratuity is payable to all eligible employees at the rate of 1 5 days of last drawn salary for each completed year of service subject to the maximum of Rs. 1 million for all employees who were on the roll as on 31.03.2014.

ii) The retirement age is taken as 60 years.

iii) Progression of future salary is taken into account while calculating the liability.

iv) Valuation Method: Projected unit credit method.

v) Basis of Valuation:


Mar 31, 2013

(a) Basis of preparation of financial statements:

The financial statements of the Company are prepared in accordance with Generally Accepted Accounting Principles in India ("Indian GAAP") under the historical cost convention on an accrual basis. The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

- All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in Revised Schedule VI to the Companies Act, 1956. The Company has ascertained its operating cycle as 12 months for the purpose of such classification.

- The amounts in the accompanying financial statements have been stated in millions of Indian rupees rounded off to two decimals.

Use of Estimates:

- The preparation of financial statements in conformity with Indian GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as at the date of the financial statements. These estimates are based upon management''s best knowledge of current events and actions. The difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

(b) Fixed assets :

- Tangible fixed assets are stated at original cost, net of tax/duty credits availed if any, less accumulated depreciation / amortisation. Costs include all expenses incurred to bring the assets to its present location and condition. Assets acquired by way of slump sale are recorded at book value in the books of the transfer or as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial activity are treated as part of the fixed assets and capitalised.

- I ntangible assets are recorded at the consideration paid for acquisition and are carried at cost less accumulated amortisation.

(c) Depreciation / Amortisation :

- Depreciation on all tangible fixed assets is provided pro-rata from / up to the date of acquisition / disposal using the straight-line method at the rates prescribed by Schedule XIV of the Companies Act, 1956.

- In case of Goodwill, the amount is amortised @4.75% p.a. using the straight-line method.

(d) Provisions, Contingent Liabilities and Contingent Assets:

- Provisions involving substantial degree of estimation in measurement are recognised if there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of obligation can be reliably estimated.

- Contingent Liabilities are not recognised in the financial statements but are disclosed in the notes to accounts. Contingent Assets are neither recognised nor disclosed in the financial statements.

(e) Revenue Recognition:

- Income from Fees and Subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the Fees receivable from existing members as at the end of the year has been recognised as income for the year.

- The costs relating to rendering of these services being unascertainable are charged off to revenue in the year in which they become legally payable.

- Input credit availed on Service Tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which Service Tax is paid in subsequent year are booked net of the Un-availed Service Tax at end of the year.

- Income by way of Franchisee Fees (including up-front fees) received pursuant to franchisee agreements entered, are recognised as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

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

- Any other income i.e. from juice bar sales, consumables etc. are recognised on receipt basis since the realisations there- from are immediate and no credit is allowed to the customers/ members.

(f) Impairment of Assets:

- The management periodically assesses using external and internal sources, whether there is an indication that an asset may be impaired.

- An impairment loss is charged to the Statement of Profit and Loss in the year in which the asset is identified as impaired.

- At each Balance Sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss.

- The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

(g) Employee benefits:

- All employee benefits payable wholly within twelve months of rendering the service are classified as a short term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc. is recognised in the period in which the employee/ contractual labour renders the related service.

- The gratuity liability is provided and charged off as revenue expenditure based on the actuarial valuation. The company has subscribed to the group gratuity scheme policy of LIC of India.

- Any other payments under the relevant labour statutes, wherever applicable, are reimbursed to the Outsourced Agency as and when applicable.

(h) Borrowing Cost:

- Borrowing cost incurred for qualifying assets is capitalised up to the date the asset is ready for intended use, based on borrowings incurred specifically for financing the asset. In determining the amount of borrowing cost eligible for capitalisation during a period, any income earned on the temporary investment on those borrowings is deducted from the borrowing cost incurred.

- Other Borrowing costs are charged off as revenue expenditure in the year in which they are incurred.

(i) Foreign Currency Transactions:

- Foreign Currency Transactions are recorded on initial recognition in the reporting currency, using the exchange rate on the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing rate.

- Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company''s monetary items at the closing rate are:

i. Upto 31 st March 2008, recognised as an income or expense in the period in which they arise and

li. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(j) Earnings Per Share:

Basic Earnings Per Share

- Basic earnings per share is computed by dividing the net profit or loss for the period attributable to Equity shareholders, by weighted average number of Equity shares outstanding during the period.

Diluted Earnings Per Share

- For the purpose of calculating Diluted Earnings Per Share, the net profit or loss for the period attributable to Equity shareholders and the weighted average number of Equity shares outstanding during the period are adjusted for the effects of all dilutive potential Equity shares.

(k) Taxes on Income:

- Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

- Deferred Taxation is recognised for all timing differences between accounting income and taxable income and is quantified using enacted / substantial enacted tax rates as at Balance Sheet date. Deferred Tax Asset are recognised subject to the management''s judgement that the realisation is virtually /reasonably certain.

- Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 11 5JAA of the Income Tax Act, 1961, based on convincing evidence that the Company will pay normal Income Tax within the statutory time frame and the same is reviewed at each Balance Sheet date.

(l) Cash Flow Statement:

- The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS) 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

- Cash and cash equivalents presented in the Cash Flow Statement consists of cash on hand, balances in Current, Fixed deposit and Cash Credit Accounts with Bank.

(m) Investments:

- Long term Investments are stated at cost, less provision for other than temporary diminution in value. Current investments comprising investments in Mutual Funds are stated at the lower of cost and fair value determined on an individual investment basis.

(n) Inve ntories:

- Inventories of stock-in-trade are valued at lower of cost and net realisable value.

(o) Debenture Redemption Reserve:

- Transfer to Debenture Redemption Reserve is made pro-rata over the life of Debentures in terms of the requirement of provisions of Companies Act, 1956.

(p) Leases:

- Leases, where the Lessor effectively retains substantially all the risks and benefits of ownership of the leased items, are classified as operating leases. Operating lease payments are recognised as expenses in the Statement of Profit and Loss.


Mar 31, 2012

(a) Basis of preparation of financial statements:

- The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 1956.

(b) Use of Estimates:

- The preparation of financial statements in conformity with generally accepted accounting principles requires that management makes estimates and assumptions that affect the reported amounts of income and expenses of the year. The reported balance of assets and liabilities and the disclosure relating to contingent liabilities as at the date of the financial statements. These estimates are based upon management's best knowledge of current events and actions. The difference between the actual results and estimates are recognised in the period in which the results are known/materialised.

(c) Fixed Assets:

- Fixed Assets are stated at original cost, net of tax/duty credits availed if any, less accumulated depreciation/ amortisation. Costs include all expenses incurred to bring the assets to its present location and condition. Assets acquired by way of slump sale are recorded at book value in the books of the transferor as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial activity are treated as part of the fixed assets and capitalised.

- Intangible assets are recorded at the consideration paid for acquisition and are carried at cost less accumulated amortisation.

(d) Depreciation/Amortisation:

- Depreciation on all fixed assets is provided pro-rata from/up to the date of acquisition/disposal using the straight line method at the rates prescribed by Schedule XIV of the Companies Act, 1956.

- In case of Goodwill, the amount is amortized @4.75% p.a. using the straight-line method.

(e) Provisions, Contingent Liabilities and Contingent Assets:

- Provisions involving substantial degree of estimation in measurement are recognised if there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of obligation can be reliably estimated.

- Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

(f) Revenue Recognition:

- Income from Fees and subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the Fees receivable from existing members as at the end of the year has been recognised as income for the year.

- The costs relating to rendering of these services being unascertainable are charged off to revenue in the year in which they become legally payable.

- Input credit availed on Service Tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which service tax is paid in subsequent year are booked net off the Un-availed Service Tax at end of the year.

- Income by way of Franchise Fees (including up-front fees) received pursuant to franchise agreements entered are recognised as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

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

- Any other income i.e. from juice bar sales, consumables etc. are recognised on receipt basis since the realisations there-from are immediate and no credit is allowed to the customers/members.

(g) Impairment of Assets:

- The management periodically assesses using, external and internal sources, whether there is an indication that an asset may be impaired.

- An impairment loss is charged to the Profit and Loss Account in the year in which the asset is identified as impaired.

- At each balance sheet date, the management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss.

- The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

(h) Employee benefits:

- All employee benefits payable wholly within twelve months of rendering the service are classified as a short-term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc is recognised in the period in which the employee/contractual labour renders the related service.

- The gratuity liability is provided and charged off as revenue expenditure based on actuarial valuation. The Company has subscribed to the group gratuity scheme policy of LIC of India.

- Any other payments under the relevant labour statutes, wherever applicable are reimbursed to the Outsourced Agency as and when applicable.

(i) Borrowing Cost:

- Borrowing cost incurred for qualifying assets is capitalised up to the date the asset is ready for intended use, based on borrowings incurred specifically for financing the asset. In determining the amount of borrowing cost eligible for capitalization during a period, any income earned on the temporary investment on those borrowings is deducted from the borrowing cost incurred.

- Other Borrowing costs are charged off to Revenue Account in the year in which they are incurred.

(j) Foreign Currency Transactions:

- Foreign Currency Transactions are recorded on initial recognition in the reporting currency, using the exchange rate on the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing rate.

- Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company's monetary items at the closing rate are:

i. Upto 31st March, 2008, recognised as income or expense in the period in which they arise and

ii. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(k) Earnings per share:

Basic Earnings Per Share

- Basic and diluted earnings per share is computed by dividing the net profit attributable to equity shareholders for the year, by weighted average number of equity shares outstanding during the year.

Diluted Earnings Per Share

- For the purpose of calculating Diluted EPS the net profit or loss for the period attributable to equity shareholders and the weighted average number of equity shares outstanding during the period are adjusted for the effects of all potential equity shares.

(l) Taxes on Income:

- Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

- Deferred Taxation is recognised for all timing differences between accounting income and taxable income and is quantified using enacted/substantial enacted tax rates as at balance sheet date. Deferred Tax asset are recognised subject to the management's judgement that the realisation is virtually/reasonably certain.

- Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961 based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each balance sheet date.

(m) Investments:

- Long-term Investments are stated at cost, less provision for other than temporary diminution in value. Current investments comprising investments in Mutual Funds are stated at the lower of cost and fair value determined on an individual investment basis.

(n) Cash Flow Statement:

- The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS) 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

- Cash and cash equivalents presented in the cash flow Statement consist of cash on hand, balances in Current, Fixed Deposit and Cash Credit Accounts with Bank.

(o) Transfer to Debenture Redemption Reserve is made pro-rata over the life of Debentures in terms of the requirement of provisions of Companies Act, 1956.

(p) Segment Reporting:

- There is only one reportable business segment as envisaged by Accounting Standard (AS) 17 'Segment Reporting'. Accordingly, no separate disclosure for the segment reporting is required to be made in the financial statement of the Company.

- Secondary segmentation based on geography has not been presented as the Company operates primarily in India and the Company perceives that there is no significant difference in its risk and returns in operating from different geographic areas within India.

(q) Lease:

Leases, where the Lessor effectively retains the substantially all the risks and benefits of ownership of the leased items, are classified as operating lease. Operating lease payments are recognised as expenses in the Statement of Profit & Loss.


Mar 31, 2011

(a) Basis of preparation of financial statements:

- The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 1956.

(b)Use of Estimates:

- The preparation of financial statements in conformity with generally accepted accounting principles requires that management makes estimates and assumptions that affect the reported amounts of income and expenses of the year. The reported balance of assets and liabilities and the disclosure relating to contingent liabilities as at the date of the financial statements. These estimates are based upon management's best knowledge of current events and actions. The difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

(c) Fixed assets :

- Fixed assets are stated at original cost, net of tax/duty credits availed if any, less accumulated depreciation / amortisation. Costs include all expenses incurred to bring the assets to its present location and condition. Assets acquired by way of slump sale are recorded at book value in the books of the transferor as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial activity are treated as part of the fixed assets and capitalized.

- Capital work-in-progress comprises outstanding advances paid to acquire fixed assets, and the cost of fixed assets that are not yet ready for their intended use at the balance sheet date.

- Intangible assets are recorded at the consideration paid for acquisition and are carried at cost less accumulated amortization.

(d)Depreciation/Amortisation :

- Depreciation on all fixed assets is provided pro-rata from / up to the date of acquisition / disposal using the straight line method at the rates orescribed by

schedule XIV of the Companies Act, 1956.

In case of Goodwill, the amount is amortized @4.75% p.a. using the straight-line method.

(e) Provisions, Contingent Liabilities and Contingent Assets:

- Provisions involving substantial degree of estimation in measurement are recognized if there is a present obligation as a result of past events and it is probable that there will be an outflow of resources.

- Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

(f) Revenue Recognition:

- Income from Fees and subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the Fees receivable from existing members as at the end of the year has been recognised as income for the year.

- The costs relating to rendering of these services being unascertainable are charged off to revenue in the year in which they become legally payable.

- Input credit availed on Service Tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which service tax is paid in subsequent year are booked net off the Un-availed Service Tax at end of the year.

- Income by way of Franchise Fees (including up-front fees) received pursuant to franchise agreements entered are recognized as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

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

- Any other income i.e. from juice bar sales, consumables etc are recognised on receipt basis since the realizations there-from are immediate and no credit is allowed to the customers / members.

(g) Impairment of Assets:

- The management periodically assesses using, external and internal sources, whether there is an indication that an asset may be impaired.

- An impairment loss is charged to the Profit & Loss Account in the year in which the asset is identified as impaired.

- At each balance sheet date, the management reviews the carrying amounts of its

assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss.

- The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

(h) EmpEoyee benefits:

- AM employee benefits payable wholly within twelve months of rendering the service are classified as a short term employee benefits. Benefits such as salaries, wages, contractual labour charges and short term compensated absences, etc is recognized in the period in which the employee/contractual labour renders the related service.

- The gratuity liability is provided and charged off as revenue expenditure based on actuarial valuation. The company has subscribed to the group gratuity scheme policy of LIC of India.

- Any other payments under the relevant labour statutes, wherever applicable are reimbursed to the Outsourced Agency as and when applicable.

(i) Borrowing Cost:

- Borrowing cost incurred for qualifying assets is capitalized up to the date the asset is ready for intended use, based on borrowings incurred specifically for financing the asset. In determining the amount of borrowing cost eligible for capitalization during a period, any income earned on the temporary investment on those borrowings is deducted from the borrowing cost incurred.

- Other Borrowing costs are charged off to Revenue Account in the year in which they are incurred.

(j) Foreign Currency Transactions;

- Exchange differences are recorded on initial recognition in the reporting currency, using the exchange rate at the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing rate.

- Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company's monetary items at the closing rate are:

i. Upto 31st March 2008, recognized as income or expense in the period in which they arise and

ii. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(k)Earnings per share:

- Basic and diluted earnings per share is computed by dividing the net profit attributable to equity shareholders for the year, by weighted average number of equity shares outstanding during the year.

(i) Taxes on Income:

- Current Tax is the amount of tax payable on the taxable income for the year as

determined in accordance with the provisions of the Income Tax Act, 1961.

- Deferred Taxation is recognized for all timing differences between accounting income and taxable income and is quantified using enacted / substantial enacted tax rates as at balance sheet date. Deferred Tax asset are recognized subject to the management's judgement that the realization is virtually / reasonably certain.

- Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961 based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each balance sheet date.

(m) Investments:

- Long term Investments are stated at cost, less provision for other than temporary diminution in value. Current investments comprising investments in Mutual Funds are stated at the lower of cost and fair value determined on an individual investment basis.

(n)Cash Flow Statement :

- The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS-3) on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

- Cash and cash equivalents presented in the cash flow Statement consist of cash on hand, balances in Current, Fixed deposit and Cash Credit Accounts with Bank.

(9) Transfer to Debenture Redemption Reserve is made pro-rata over the life of Debentures in terms of the requirement of provisions of Companies Act, 1956.

(p) Segment Reporting:

- There is only one reportable business segment as envisaged by AS-17 'Segment Reporting'. Accordingly, no separate disclosure for the segment reporting is required to be made in the financial statement of the company.

- Secondary segmentation based on geography has not been presented as the company operates primarily in India and the Company perceives that there is no significant difference in its risk and returns in operating from different geographic areas within India.


Mar 31, 2010

(a) Basis of preparation of financial statements:

- The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006 and the provisions of the Companies Act, 1956. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

- The preparation of financial statements in conformity with generally accepted accounting principles requires that management makes estimates and assumptions that affect the reported amounts of income and expenses of the year. The reported balance of assets and liabilities and the disclosure relating to contingent liabilities as at the date of the financial statements. These estimates are based upon managements best knowledge of current events and actions. The difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

(b) Fixed assets and depreciation:

- Fixed assets are stated at original cost, net of tax / duty credits availed if any, less accumulated depreciation / amortisation. Assets acquired by way of slump sale are recorded at book value in the books of the transferor as on the date of transfer. Revenue expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of activity are treated as part of the fixed assets and capitalised. Capital work-in-progress comprises outstanding advances paid to acquire fixed assets, and the cost of fixed assets that are not yet ready for their intended use at the balance sheet date. Intangible assets are recorded at the consideration paid for acquisition.

- Depreciation on all fixed assets is provided pro-rata from / up to the date of acquisition / disposal using the straight line method at the rates prescribed by schedule XIV of the Companies Act, 1956.

- In case of Goodwill, the amount is amortised @4.75% p.a. using the straight-line method.

(c) Provisions, Contingent Liabilities and Contingent Assets:

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

(d) Revenue Recognition:

- Income from Fees and subscriptions, recorded net of discounts and rebates have been recognised as income for the year irrespective of the period, for which these are received. However, the Fees receivable from existing members as at the end of the year has been recognised as income for the year.

- The costs relating to rendering of these services being unascertainable are charged off to revenue in the year in which they become legally payable.

- Input credit availed on Service Tax through revenue expenses paid are accounted for separately as income, thus accounting the expenses at their gross values inclusive of service tax. Expenses on which Service Tax is paid in subsequent year are booked net off the Un-availed Service Tax at end of the year.

- Income by way of Franchisee Fees (including up-frontfees) received pursuantto franchise agreements entered are recognised as income of the period in accordance with terms of the agreement, and as per data submitted by the franchisees.

- Any other income i.e. from juice bar sales, consumables, etc. are recognised on receipt basis since the realisations there-from are immediate and no credit is allowed to the customers/ members.

(e) Impairment of Assets:

- An impairment loss is charged to the Profit and Loss Account in the year in which the asset is identified as impaired.

(f) Employee benefits:

- All employee benefits payable wholly within twelve months of rendering the service are classified as a short-term employee benefits. Benefits such as salaries, wages, contractual labour charges and short-term compensated absences, etc. is recognised in the period in which the employee/ contractual labour renders the related service. Any other payments under relevant labour statutes, wherever applicable, are reimbursed to the outsourced agencies and charged off to the Profit and Loss Account in the year of payment.

- Post Retirement benefits are neither funded nor covered by a defined contribution plan. Post Employment and other long-term employee benefits are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised based on actuarial valuation at year end using the Projected unit credit method.

- Any other payments under the relevant labour statutes, wherever applicable are reimbursed to the Outsourced Agency as and when applicable.

(g) Borrowing Cost:

- Borrowing costs that are attributable to the acquisition or construction are capitalised as part of cost of such asset till such time as the asset is ready for its intended use.

- Other Borrowing costs are charged off to Revenue Account in the year in which they are incurred. (h) Foreign Currency Transactions:

- Exchange differences are recorded on initial recognition in the reporting currency, using the exchange rate at the date of the transaction. At each Balance Sheet date, foreign currency monetary items are reported using the closing rate.

- Exchange differences that arise on settlement of monetary items or on reporting at each Balance Sheet date of the Companys monetary items at the closing rate are:

i. Upto 31st March 2008, recognised as income or expense in the period in which they arise and

ii. Thereafter adjusted in the cost of fixed assets specifically financed by the borrowings to which the exchange differences relate.

(i) Earnings per share:

- Basic and diluted earnings per share is computed by dividing the net profit attributable to equity shareholders for the year, by weighted average number of equity shares outstanding during the year.

(j) Taxes on Income:

- Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

- Deferred Tax Liability in accordance with the Accounting Standard (AS) 22 amounting to Rs.329.19 lacs on account of the timing difference between the depreciation as per the Companies Act & Income Tax Act and the unabsorbed depreciation as per Income Tax Act had not been considered in the accounts in the previous years, the same has been adjusted against the Reserves brought forward by the Company. The Deferred Tax Liability of the current year amounting to Rs.1 52.90 lacs has been charged to profits of the current year in accordance with the Accounting Standard (AS) 22.

(k) Investments:

- The Company has classified all its investments as long-term. Long-term Investments are stated at cost. (I) Cash Flow Statement:

- The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard (AS) 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company.

- Cash and cash equivalents presented in the cash flow statement consist of Cash on hand, balances in Current, Fixed deposit and Cash Credit Accounts with Bank.

 
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