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Accounting Policies of Tutis Technologies Ltd. Company

Mar 31, 2011

1. Accounting Convention :

The Financial Statements have been prepared under the historical cost convention, on accrual basis to comply in all material respects with all applicable accounting principles in India, the applicable Accounting Standards notified under Section 211(3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates:

The preparation of the financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any differences of actual results to such estimates are recognized in the period in which the results are known / materialized.

3. Fixed Assets :

The fixed assets are stated at acquisition cost less accumulated depreciation.

4. Depreciation:

a) Depreciation on fixed assets has been provided on straight line method and depreciation on the assets acquired / sold during the year is provided on pro-rata basis.

b) Depreciation is charged at one hundred percent in respect of the Individual assets costing less than Rs.5,000.00 in the year of purchase.

5. Investments :

The Investments are classified as Quoted & Unquoted Investments.

a) 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.

b) There are no current investments.

6. Valuation of Inventories

Inventories are valued at lower of cost or net realizable value, on FIFO basis. Obsolete, defective and unserviceable stock are provided for wherever required.

7. Foreign Currency Transactions :

Transactions in foreign currency are recorded at the exchange rates prevailing at the dates of the transactions. Gains / losses arising out of fluctuation in exchange rates on settlement are recognised in the profit and loss account.

Foreign currency monetary assets and liabilities are restated at the exchange rate prevailing at the period end and the overall net gain / loss is adjusted to the profit and loss account.

8. Retirement Benefits :

(a) Provident Fund: Contribution to Provident Fund is made at the pre- determined rate, to the appropriate authorities and is charged to revenue as expenditure.

(b) Leave Encashment and Gratuity : As per Accounting Standard 15 issued by The Institute of Chartered Accountants of India, the Company is required to provide for liability in respect of earned Leave Encashment and Gratuity on accrual basis. However the Company continue to follow the past practice of charging leave encashment on cash basis and Gratuity is provided in the books as per actuarial valuation done. Refer note no 3.

9. Income and Expenditure

All income and expenditure are accounted on accrual basis by the company as required under section 209(3) of the Companies (Amendment) Act, 1988.

10. Revenue Recognition :

(a) Sales are exclusive of VAT and net of returns, claims, rebates and discounts etc.,

(b) Other items of revenue are recognised in accordance with the Accounting Standard (AS9). Accordingly, wherever there are uncertainties in the ascertainment / realisation of income such as interest from customers (including the financial conditions of the person from whom the same is to be realised), the same is accounted for in the year in which it is realised.

(c) Deferred Revenue expenses: Rs. 11,91,100 was incurred during the year for increasing Authorised Capital. Looking to the nature of expenses, it is spread over a period of five years. 1/5th being Rs. 2,38,220 is debited during the year as revenue expenses.

11. Borrowing Costs :

Interest and other costs incurred in connection with borrowing of the funds are charged to revenue on accrual basis except those borrowing cost which are directly attributable to the acquisition or construction of those fixed assets, which necessarily take a substantial period of time to get ready for their intended use. Such costs are capitalised with the fixed assets.

12. Earnings per Share (EPS) :

The earnings considered in ascertaining the Company's EPS comprises the net profit after tax (after providing the post tax effect of any extra ordinary items). The number of shares used in computing Basic EPS is the weighted average number of equity shares outstanding during the year.

13. Taxation :

a) Current Tax: A provision for current income tax is made on the taxable income using the applicable tax rates and tax laws.

b) Deferred Tax: Deferred tax arising on account of timing differences and which are capable of reversal in one or more subsequent periods is recognized using the tax rates and tax laws that have been enacted or substantively enacted. Deferred tax assets are not recognized unless there is a virtual certainty with respect to the reversal of the same in future.

14.Impairment of Assets :

Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is higher of the asset's fair value less costs to sell vis-à-vis value in use. For the purpose of impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows.

15.Provisions and Contingencies :

The company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that probably will not require an outflow of resources or where a reliable estimate of the obligation cannot be made.


Mar 31, 2010

1. Basic of Accounting

a) The financial statements have been prepared under the historical cost convention and in accordance with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and relevant presentational requirements of the Companies Act, 1956.

b) Accounting policies not specifically referred to otherwise are in Consonance with prudent accounting principals.

c) All income and expenditure items having material bearing on the Financial statements are recognized on accrual basis.

2. Investment

Current Investments are valued at cost. 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.

3. Fixed Assets

Fixed assets are stated at cost including related incidental expenditure less accumulated depreciation. Revenue expenditure incidental to the establishment of new Technology Center has been capitalized by allocating to various newly acquired fixed assets in proportion to the value of those fixed assets.

4. Depreciation

a) Depreciation on fixed assets has been provided on straight line method and depreciation on the assets acquired / sold during the year is provided on pro-rata basis.

b) Depreciation is charged at one hundred percent in respect of the Individual assets costing less than Rs.5,000.00 in the year of purchase.

5. Foreign Currency Transaction

In case of sale made to clients, income is accounted on the basis of the exchange rate as on the date of the transaction.

6. Income Taxes are accounted for in accordance with Accounting Standard (AS 22) on "Accounting Taxes on Income" issued by the Institute of Chartered Accountants of India.

 
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