Mar 31, 2015
1. Corporate Information
UNNO INDUSTRIES LIMITED (the Company) is a leading Non Banking Finance
Company, Registered with Reserve Bank of India and was incorporated on
4th August, 1992. The Company provides financial support to emerging
business entrepreneurs.
2. Basis of Preparation
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. Pursuant to section 133 of the
Companies Act, 2013 read with rule 7 of the Companies (Accounts) Rules
2014, till the standards of accounting or any addendum thereto are
prescribed by the Central Government in consultation and recommendation
of the National Financial Reporting Authority, the existing Accounting
Standards notified under the Companies Act, 1956 shall continue to
apply. Accordingly, these financial statements have been prepared to
comply in all material aspects with the Accounting Standards notified
under section 211(3C) of the Companies Act, 1956, Companies (Accounting
Standards) Rules, 2006, (as amended), the other relevant provisions of
the Companies Act, 2013 and Reserve Bank of India Regulations in
relation to Non Banking Finance Companies to the extent applicable to
the Company.
All assets and liabilities have been classified as current or
non-current as per the criteria set out in the schedule III to the
Companies Act, 2013. Based on the nature of the products and the time
between acquisition of assets for processing and their realization in
cash and cash equivalents, the Company has ascertained its operating
cycle as 12 months for the purpose of current/non-current
classification of its assets and liabilities.
a. Use of estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management's best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
b. Tangible fixed assets
Fixed assets, except land and buildings are stated at cost, net of
accumulated depreciation and accumulated impairment losses, if any. The
cost comprises purchase price borrowing costs if capitalization
criteria are met and directly attributable cost of bringing the asset
to its working condition for the intended use. Any trade discounts and
rebates are deducted in arriving at the purchase price.
Subsequent expenditure related to an item of fixed asset is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance.
Other expense on existing fixed assets including day- to- day repair
and maintenance expenditure and cost of replacing parts are charged to
the statement of profit and loss for the period.
c. Depreciation on tangible fixed assets
Deprecation on fixed assets is calculated on a WDV method using the
rates specified under the Schedule XIV to the Companies Act, 1956
arrived on the basis of the useful lives estimated by the management.
Useful lives of assets are determined by management by an internal
technical assessment except where such assessment suggests a life
significantly different from those prescribed by schedule II-part C of
the companies act, 2013 where the useful life is as assessed and
certified by a technical expert.
d. Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses if any. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized and
expenditure is reflected in the statement of profit and loss in the
year in which the expenditure is incurred.
Intangible assets (goodwill) arising on consolidation or acquisition is
not amortized but is tested for impairment.
The amortization period and the amortization method are reviewed at
least at each financial year end. If the expected useful life of the
asset is significantly different from previous estimates, the
amortization period is changed accordingly. If there has been a
significant change in the expected pattern of economic benefits from
the asset, the amortization method is changed to reflect the changed
pattern. Such changes are accounted for in accordance with AS 5 Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies.
Gains or losses arising from derecognizing of an intangible asset are
measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in the statement of
profit and loss when the asset is derecognized.
e. Borrowing Cost
Borrowing cost includes interest, amortization of ancillary costs
incurred in connection with the arrangement of borrowings and exchange
differences arising from foreign currency borrowings to the extent they
are regarded as an adjustment to the interest cost.
Borrowing costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a Substantial period
of time to get ready for its Intended use or sale are capitalized as
part of the cost of the respective asset. All other borrowing costs are
expensed in the period they occur.
f. Impairment of tangible and intangible assets
Management periodically assesses using, external and internal sources,
whether there is an indication that an asset may be impaired. An
impairment loss is recognized wherever the carrying value of an asset
exceeds its recoverable amount. The recoverable amount is higher of the
asset's net selling price and value in use i.e. the present value of
future cash flows expected to arise from the continuing use of the
asset and its eventual disposal. An impairment loss for an asset is
reversed if there has been a change in the estimates used to determine
the recoverable amount since the last impairment loss was recognized.
g. Leases
Where the Company is the lessee
Leases which effectively transfer to the Company substantially all the
risks and benefits incidental to ownership of the leased item, are
classified as finance leases and are capitalized at the lower of the
fair value and present value of the minimum lease payments at the
inception of the lease term and disclosed as assets acquired on finance
lease. Lease payments are apportioned between the finance charges and
reduction of the lease liability based on the implicit rate of return.
Finance charges on account of finance leases are charged to statement
of profit and loss.
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as an expense
in the statement of profit and loss on a straight line basis over the
lease term.
h. Investments
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost. However, provision for diminution in value is made to recognize a
decline other than temporary in the value of the investments.
i. Revenue Recognition
Expenses and income considered payable and receivable respectively have
been accounted for on accrual basis. Where the ability to assess the
ultimate collection with reasonable certainty is lacking at the time of
raising any claim, revenue recognition is postponed to the extent of
uncertainty involved
j. Taxes on Income
Tax expense comprises current and deferred tax. Current income tax is
measured at the amount expected to be paid to the tax authorities in
accordance with the Income- tax Act, 1961 enacted in India and tax laws
prevailing in the respective tax jurisdictions where the company
operates. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at the reporting date.
Deferred Income taxes reflect the impact of timing differences between
taxable income and accounting Income originating during the current
year and reversal of timing differences for the earlier years. Deferred
tax is measured using the tax rates and the tax laws enacted or
substantively enacted at the reporting date. Deferred income tax
relating to items recognized directly in equity is recognized in equity
and not in the statement of profit and loss.
Deferred tax liabilities are recognized for taxable timing differences.
Deferred tax assets are recognized for deductible timing differences
only to the extent that there is reasonable certainty that sufficient
future taxable income will be available against which such deferred tax
assets can be realized. In situations where the company has unabsorbed
depreciation or carry forward tax losses, all deferred tax assets are
recognized only if there is virtual certainty supported by convincing
evidence that they can be realized against future taxable profits.
At each reporting date, the company reassesses' unrecognized deferred
tax assets. It recognizes unrecognized deferred tax asset to the extent
that it has become reasonably certain or virtually certain as the case
may be that sufficient future taxable income will be available against
which such deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each
reporting date. The company writes down the carrying amount of deferred
tax asset to the extent that it is no Longer reasonably certain or
virtually certain as the case may be that sufficient future taxable
income will be available against which deferred tax asset can be
realized. Any such write down is reversed to the extent that it becomes
reasonably certain or virtually certain as the case may be that
sufficient future taxable income will be available.
Deferred tax assets and deferred tax liabilities are offset, if a
legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and deferred taxes
relate to the same taxable entity and the same taxation authority.
Minimum alternate tax (MAT) paid in a year is charged to the statement
of profit and loss as current tax. The company recognizes MAT credit
available as an asset only to the extent that there is convincing
evidence that the company will pay normal income tax during the
specified period. i.e the period for which MAT credit is allowed to be
carried forward. In the year in which the company recognizes MAT credit
as an asset in accordance with the Guidance Note on Accounting for
Credit Available in respect of Minimum Alternative Tax under the
Income- tax Act, 1961, the said asset is created by way of credit to
the statement of profit and loss and shown as "MAT Credit Entitlement."
The company reviews the "MAT credit entitlement" asset at each
reporting date and writes down the asset to the extent the company does
not have convincing evidence that it will pay normal tax during the
specified period.
k. Earnings per share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders by the weighted
average number of equity shares outstanding during the year.
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 shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares
l. Provisions
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
During the year advances, Receivables and investment made are
recoverable and performing, therefore management has not made any
provisions for bad or doubtful asset, however 0.25% of the Standard
Assets is being provided as per the notification issued by the Reserve
Bank of India (RBI).
In accordance with the notification No. DNBS.222/CGM(US)-2011 dated
17-01-2011issued by the Reserve Bank of India (RBI) vide its Directions
to all NBFCs to make general provision of 0.25% of the standard assets
The company has made a provision of Rs.4,05,958./- on the standard
assets as on March 31, 2015. The amount of provision on Standard assets
is shown separately as Contingent provision against Standard Assets
under Long Term Provisions in the Balance Sheet.
Pursuant to section 4C of the Reserve Bank Of India. 1934, during the
year the company has transferred an amount of Rs 2,89,182 to Statutory
Reserve
m. Contingent Liabilities
A contingent liability is a possible obligation that arises from past
events whose existence will be confirmed by the occurrence/
non-occurrence of one or more uncertain future events beyond the
control of the Company or a present obligation that is not recognized
because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises
in extremely rare cases where there is a liability that cannot be
recognized because it cannot be measured reliably. The Company does not
recognize the contingent liability but discloses its existence in the
financial statements.
n. Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and fixed
deposits with an original maturity of three months or less with banks.
o. Segment Reporting
The company is operating in single segment and hence segment wise
separate reporting as per AS 17 issued by ICAI is not required.
Mar 31, 2014
A. Use of estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management''s best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
b. Tangible fixed assets
Fixed assets, except land and buildings are stated at cost, net of
accumulated depreciation and accumulated impairment losses, if any. The
cost comprises purchase price borrowing costs if capitalization
criteria are met and directly attributable cost of bringing the asset
to its working condition for the intended use. Any trade discounts and
rebates are deducted in arriving at the purchase price.
Subsequent expenditure related to an item of fixed asset is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance.
Other expense on existing fixed assets including day-to-day repair and
maintenance expenditure and cost of replacing parts are charged to the
statement of profit and loss for the period.
c. Depreciation on tangible fixed assets
Depreciation on fixed assets is calculated on a WDV method using the
rates specified under the Schedule XIV to the Companies Act, 1956
arrived on the basis of the useful lives estimated by the management
d. Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses if any. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized and
expenditure is reflected in the statement of profit and loss in the
year in which the expenditure is incurred.
Intangible assets (goodwill) arising on consolidation or acquisition is
not amortized but is tested for impairment.
The amortization period and the amortization method are reviewed at
least at each financial year end. If the expected useful life of the
asset is significantly different from previous estimates, the
amortization period is changed accordingly. If there has been a
significant change in the expected pattern of economic benefits from
the asset, the amortization method is changed to reflect the changed
pattern. Such changes are accounted for in accordance with AS 5 Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies.
Gains or losses arising from derecognizing of an intangible asset are
measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in the statement of
profit and loss when the asset is derecognized.
e. Borrowing Cost
Borrowing cost includes interest, amortization of ancillary costs
incurred in connection with the arrangement of borrowings and exchange
differences arising from foreign currency borrowings to the extent they
are regarded as an adjustment to the interest cost.
Borrowing costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a Substantial period
of time to get ready for its Intended use or sale are capitalized as
part of the cost of the respective asset. All other borrowing costs are
expensed in the period they occur.
f. Impairment of tangible and intangible assets
Management periodically assesses using, external and internal sources,
whether there is an indication that an asset may be impaired. An
impairment loss is recognized wherever the carrying value of an asset
exceeds its recoverable amount. The recoverable amount is higher of the
asset''s net selling price and value in use i.e. the present value of
future cash flows expected to arise from the continuing use of the
asset and its eventual disposal. An impairment loss for an asset is
reversed if there has been a change in the estimates used to determine
the recoverable amount since the last impairment loss was recognized.
g. Leases
Where the Company is the lessee
Leases which effectively transfer to the Company substantially all the
risks and benefits incidental to ownership of the leased item, are
classified as finance leases and are capitalized at the lower of the
fair value and present value of the minimum lease payments at the
inception of the lease term and disclosed as assets acquired on finance
lease. Lease payments are apportioned between the finance charges and
reduction of the lease liability based on the implicit rate of return.
Finance charges on account of finance leases are charged to statement
of profit and loss.
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as an expense
in the statement of profit and loss on a straight line basis over the
lease term.
h. Investments
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost. However, provision for diminution in value is made to recognize a
decline other than temporary in the value of the investments.
i. Revenue Recognition
Expenses and income considered payable and receivable respectively have
been accounted for on accrual basis. Where the ability to assess the
ultimate collection with reasonable certainty is lacking at the time of
raising any claim, revenue recognition is postponed to the extent of
uncertainty involved
j. Taxes on Income
Tax expense comprises current and deferred tax. Current income tax is
measured at the amount expected to be paid to the tax authorities in
accordance with the Income-tax Act, 1961 enacted in India and tax
laws prevailing in the respective tax jurisdictions where the company
operates. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at the reporting date.
Deferred Income taxes reflect the impact of timing differences between
taxable income and accounting Income originating during the current
year and reversal of timing differences for the earlier years.
Deferred tax is measured using the tax rates and the tax laws enacted
or substantively enacted at the reporting date. Deferred income tax
relating to items recognized directly in equity is recognized in
equity and not in the statement of profit and loss.
Deferred tax liabilities are recognized for taxable timing differences.
Deferred tax assets are recognized for deductible timing differences
only to the extent that there is reasonable certainty that sufficient
future taxable income will be available against which such deferred tax
assets can be realized. In situations where the company has unabsorbed
depreciation or carry forward tax losses, all deferred tax assets are
recognized only if there is virtual certainty supported by convincing
evidence that they can be realized against future taxable profits.
At each reporting date, the company re-assesses unrecognized deferred
tax assets. It recognizes unrecognized deferred tax asset to the extent
that it has become reasonably certain or virtually certain as the case
may be that sufficient future taxable income will be available against
which such deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each
reporting date. The company writes-down the carrying amount of deferred
tax asset to the extent that it is no
Longer reasonably certain or virtually certain as the case may be that
sufficient future taxable income will be available against which
deferred tax asset can be realized. Any such write-down is reversed to
the extent that it becomes reasonably certain or virtually certain as
the case may be that sufficient future taxable income will be
available.
Deferred tax assets and deferred tax liabilities are offset, if a
legally enforceable right exists to set-off current tax assets against
current tax liabilities and the deferred tax assets and deferred taxes
relate to the same taxable entity and the same taxation authority.
Minimum alternate tax (MAT) paid in a year is charged to the statement
of profit and loss as current tax. The company recognizes MAT credit
available as an asset only to the extent that there is convincing
evidence that the company will pay normal income tax during the
specified period. i.e the period for which MAT credit is allowed to be
carried forward. In the year in which the company recognizes MAT credit
as Minimum Alternative Tax under the Income tax Act, 1961, the said
asset is created by way of credit to the an asset in accordance with
the Guidance Note on Accounting for Credit Available in respect of
statement of profit and loss and shown as "MAT Credit Entitlement." The
company reviews the "MAT credit entitlement" asset at each reporting
date and writes down the asset to the extent the company does not have
convincing evidence that it will pay normal tax during the specified
period.
k. Earnings per share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders by the weighted
average number of equity shares outstanding during the year. 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 shares outstanding during the year are adjusted for
the effects of all dilutive potential equity shares
l. Provisions
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
During the year advances, Receivables and investment made are
recoverable and performing, therefore management has not made any
provisions for bad or doubtful asset, however 0.25% of the Standard
Assets is being provided as per the notification issued by the Reserve
Bank of India (RBI).
In accordance with the notification No. DNBS.222/CGM(US)-2011 dated
17-01-2011issued by the Reserve Bank of India (RBI) vide its Directions
to all NBFCs to make ageneral provision of 0.25% of the standard assets
The company has made a provision of Rs.3,70,856./- on the standard
assets as on March 31, 2014. The amount of provision on Standard assets
is shown separately as Contingent provision against Standard Assets
under Long Term Provisions in the Balance Sheet. Pursuant to section 4C
of the Reserve Bank Of India. 1934, during the year the company has
transferred an amount of Rs 2, 59,392 to Statutory Reserve
m. Contingent Liabilities
A contingent liability is a possible obligation that arises from past
events whose existence will be confirmed by the occurrence/
non-occurrence of one or more uncertain future events beyond the
control of the Company or a present obligation that is not recognized
because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises
in extremely rare cases where there is a liability that cannot be
recognized because it cannot be measured reliably. The Company does not
recognize the contingent liability but discloses its existence in the
financial statements.
n. Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and fixed
deposits with an original maturity of three months or less with banks.
o. Segment Reporting
The company is operating in single segment and hence segment wise
separate reporting as per AS 17 issued by ICAI is not required.
Mar 31, 2013
A. Use of estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management''s best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
b. Tangible fixed assets
Fixed assets, except land and buildings are stated at cost, net of
accumulated depreciation and accumulated impairment losses, if any. The
cost comprises purchase price borrowing costs if capitalization
criteria are met and directly attributable cost of bringing the asset
to its working condition for the intended use. Any trade discounts and
rebates are deducted in arriving at the purchase price.
Subsequent expenditure related to an item of fixed asset is added to
its book value only if it increases the expense on existing fixed
assets including da?y ?to day repair and maintenance expenditure and
cost of future benefits from the existing asset beyond its previously
assessed standard of performance. Other replacing parts are charged to
the statement of profit and loss for the period.
c. Depreciation on tangible fixed assets
Depreciation on fixed assets is calculated on a WDV method using the
rates specified under the Schedule XIV to the Companies Act, 1956
arrived on the basis of the useful lives estimated by the management
d. Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses if any. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized and
expenditure is reflected in the statement of profit and loss in the
year in which the expenditure is incurred.
Intangible assets (goodwill) arising on consolidation or acquisition is
not amortized but is tested for impairment.
The amortization period and the amortization method are reviewed at
least at each financial year end. If the expected useful life of the
asset is significantly different from previous estimates, the
amortization period is changed accordingly. If there has been a
significant change in the expected pattern of economic benefits from
the asset, the amortization method is changed to reflect the changed
pattern. Such changes are accounted for in accordance with AS 5 Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies.
Gains or losses arising from derecognizing of an intangible asset are
measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in the statement of
profit and loss when the asset is derecognized.
e. Borrowing Cost
Borrowing cost includes interest, amortization of ancillary costs
incurred in connection with the arrangement of borrowings and exchange
differences arising from foreign currency borrowings to the extent they
are regarded as an adjustment to the interest cost.
Borrowing costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a Substantial period
of time to get ready for its Intended use or sale are capitalized as
part of the cost of the respective asset. All other borrowing costs are
expensed in the period they occur.
f. Impairment of tangible and intangible assets
Management periodically assesses using, external and internal sources,
whether there is an indication that an asset may be impaired. An
impairment loss is recognized wherever the carrying value of an asset
exceeds its recoverable amount. The recoverable amount is higher of the
asset''s net selling price and value in use i.e. the present value of
future cash flows expected to arise from the continuing use of the
asset and its eventual disposal. An impairment loss for an asset is
reversed if there has been a change in the estimates used to determine
the recoverable amount since the last impairment loss was recognized.
g. Leases
Where the Company is the lessee
Leases which effectively transfer to the Company substantially all the
risks and benefits incidental to ownership of the leased item, are
classified as finance leases and are capitalized at the lower of the
fair value and present value of the minimum lease payments at the
inception of the lease term and disclosed as assets acquired on finance
lease. Lease payments are apportioned between the finance charges and
reduction of the lease liability based on the implicit rate of return.
Finance charges on account of finance leases are charged to statement
of profit and loss.
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as an expense
in the statement of profit and loss on a straight line basis over the
lease term.
h. Investments
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All o t h e r
investments are classified as long term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost. However, provision for diminution in value is made to recognize a
decline other than temporary in the value of the investments.
i. Revenue Recognition
Expenses and income considered payable and receivable respectively have
been accounted for on accrual basis. Where the ability to assess the
ultimate collection with reasonable certainty is lacking at the time of
raising any claim, revenue recognition is postponed to the extent of
uncertainty involved
j. Taxes on Income expected to be paid to the tax authorities in
accordance with the Incom?e tax Act,
Tax expense comprises current and deferred tax. Current income tax is
measured at the amount 1961 enacted in India and tax laws prevailing in
the respective tax jurisdictions where the company operates. The tax
rates and tax laws used to compute the amount are those that are
enacted or substantively enacted, at the reporting date.
Deferred Income taxes reflect the impact of timing differences between
taxable income and accounting Income originating during the current
year and reversal of timing differences for the earlier years.
Deferred tax is measured using the tax rates and the tax laws enacted
or substantively enacted at t h e reporting date. Deferred i n c o m e
t a x relating to items recognized directly in equity is recognized in
equity and not in the statement of profit and loss.
Deferred tax liabilities are recognized for taxable timing differences.
Deferred tax assets are recognized for deductible timing differences
only to the extent that there is reasonable certainty that sufficient
future taxable income will be available against which such deferred tax
assets can be realized. In situations where the company has unabsorbed
depreciation or carry forward tax losses, all deferred tax assets are
recognized only if there is virtual certainty supported by convincing
evidence that they can be realized against future taxable profits.
At each reporting date, the company ?re assesses unrecognized deferred
tax assets. It recognizes unrecognized deferred tax asset to the extent
that it has become reasonably certain or virtually certain as the case
may be that sufficient future taxable income will be available against
which such deferred tax assets can be realized. write?s down the
carrying amount of deferred tax asset to the extent that it is no
The carrying amount of deferred tax assets are reviewed at each
reporting date. The company will be available against which deferred
tax asset can be realized. Any such wri?te down is reversed to Longer
reasonably certain or virtually certain as the case may be that
sufficient future taxable income the extent that it becomes reasonably
certain or virtually certain as the case may be that sufficient future
taxable income will be available.
Deferred tax assets and deferred tax liabilities are offset, if a
legally enforceable right exists to s?et off current tax assets against
current tax liabilities and the deferred tax assets and deferred taxes
relate to the same taxable entity and the same taxation authority.
Minimum alternate tax (MAT) paid in a year is charged to the statement
of profit and loss as current tax. The company recognizes MAT credit
available as an asset only to the extent that there is convincing
evidence that the company will pay normal income tax during the
specified period. i.e the period for which MAT credit is allowed to be
carried forward. In the year in which the company recognizes MAT
respect of Minimum Alternative Tax under the Incom?e tax Act, 1961, the
said asset is created by way of credit as an asset in accordance with
the Guidance Note on Accounting for Credit Available in credit to the
statement of profit and loss and shown as "MAT Credit Entitlement." The
company reviews the "MAT credit entitlement" asset at each reporting
date and writes down the asset to the extent the company does not have
convincing evidence that it will pay normal tax during the specified
period.
k. Earnings per share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders by the weighted
average number of equity shares outstanding during the year. 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 shares outstanding during the year are adjusted for
the effects of all dilutive potential equity shares
l. Provisions
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
m. Contingent Liabilities
A contingent liability is a possible obligation that arises from past
events whose existence will be confirmed by the occurrence/
non-occurrence of one or more uncertain future events beyond the
control of the Company or a present obligation that is not recognized
because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises
in extremely rare cases where there is a liability that cannot be
recognized because it cannot be measured reliably. The Company does not
recognize the contingent liability but discloses its existence in the
financial statements.
n. Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and fixed
deposits with an original maturity of three months or less with banks.
o. Segment Reporting
The company is operating in single segment and hence segment wise
separate reporting as per AS 17 issued by ICAI is not required.
Mar 31, 2012
1. 01 BASIS OF ACCOUNTING
The accounts of the Company are prepared under the historical cost
convention and in accordance with applicable Accounting Standards
except where otherwise stated. Accounting Policies not specifically
referred to are consistent with generally accepted accounting policies.
The Company follows the mercantile system of accounting and recognises
Income and Expenditure on accrual basis except otherwise specified.
1.02 REVENUE RECOGNITION
Expenses and income considered payable and receivable respectively have
been accounted for on accrual basis. Where the ability to assess the
ultimate collection with reasonable certainty is lacking at the time of
raising any claim, revenue recognition is postponed to the extent of
uncertainty involved.
1.03 FIXED ASSETS:
Fixed Assets are stated at cost of acquisition inclusive of freight,
duties, taxes and incidental expenses, less depreciation.
1.04 DEPRECIATION
Depreciation on Fixed Assets has been provided on the straight line
method at the rates prescribed in schedule XIV of the Companies Act,
1956 and on additions on Pro-rata basis.
1.05 INVESTMENTS
Investments (Long Term, other and current investments) are stated at
cost. All Investments are held as "Stock in Trade".
1.06 PROVISION FOR DIMINUTION IN VALUE OF INVESTMENTS
Provision for diminution in value of Long Term Quoted Investments and
Current Investments are provided at in aggregate for each category at
difference between cost and market value (if lower than cost), at the
balance sheet date, and Provision for diminution in value Other
unquoted Investments are ascertained either from the latest balance
sheet of the company, if available or value shares at Re. 1/- per
share, as the case may be in accordance with Reserve Bank of India
guidelines.
1.07 CONTINGENT LIABILITIES
Contingent liabilities are not Provided and are disclosed by way of
notes to accounts.
Mar 31, 2010
1. BASIS OF ACCOUNTING
The accounts of the Company are prepared under the historical cost
convention and in accordance with applicable Accounting Standards
except where otherwise staled. Accounting Policies not specifically
referred to are consistent with generally accepted accounting policies.
The Company follows the mercantile system of accounting and recognises
Income and Expenditure on accrual basis except otherwise specified.
2. REVENUE RECOGNITION
Expenses and income considered payable and receivable respectively have
been accounted for on accrual basis. Where the ability to assess the
ultimate collection with reasonable certainty is lacking at the time of
raising any claim, revenue recognition is postponed to the extent of
uncertainty involved.
3. FIXED ASSETS:
Fixed Assets are stated at cost of acquisition inclusive of freight,
duties, taxes and incidental expenses, less depreciation.
4. DEPRECIATION
Depreciation on Fixed Assets has been provided on the straight line
method at the rates prescribed in schedule XIV of the Companies Act,
1956 and on additions on Pro-rata basis.
5. INVESTMENTS
Investments (Long Term, other and current investments) are stated at
cose. All Investments are held as "Stock in Trade".
6. PROVISION FOR DIMUNATION IN VALUE OF INVESTMETS
Provision for diminution in value of Long Term Quoted Investments and
Current Investments are provided at in aggregate for each category at
difference between cost and market value (if lower than cost) . at (he
balance sheet date, and Provision for diminution in value Other
unquoted Investments are ascertained either from the lakes! balance
sheet of the company, if available or value shares at Re. 1/- per share
, as the case ma} be in accordance with Reserve Bank of India
guidelines.
7. CONTINGENT LIABILITIES
Contingent liabilities are not Provided and are disclosed by way of
notes to accounts.