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Accounting Policies of Vision Cinemas Ltd. Company

Mar 31, 2015

1.1 BASIS OF PREPARATION

The Consolidated financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under Historical Cost convention on accrual basis. GAAP comprises mandatory Accounting Standards as specified in the Companies (Accounting Standards) Rules, 2006.

1.2 PRINCIPLES OF CONSOLIDATION

The financial Statement of the Subsidiary company used in the consolidation are drawn up to the same reporting date as of the Company.

The Consolidated financial statements have been prepared on the following basis:

i. The Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and other events in similar circumstances and are presented to the extent possible, in the same manner as the company's separate Financial Statements.

ii. The Consolidated of the financial statements of the holding company and its Subsidiary is done to the extent possible on a line by line bases by adding together like items of assets,liabilities,income and expenses;inter group transactions,balances and unrealized inter company profits have been eliminated in the process of consolidation.

iii. The excess of cost to the Company of its investments in subsidiary companies over its share of the equity of the subsidiary companies at the dates on which the investments in the subsidiary companies are made, is recognized as 'Goodwill' being an asset in the consolidated financial statements.Alternatively,where the share of equity in the subsidiary company as on the date of investment is in excess of cost of investment in the company,it is recognized as 'Capital Reserve' and shown under the head 'Reserves and Surplus', in the consolidated financial statement.

iv. Minority interest in subsidiary represents the minority shareholders proportionate share of net asset and net income.

1.3 USE OF ESTIMATES:

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates. Significant estimates used by the management in the preparation of these financial statements include classification of assets and liabilities into current and non-current, estimates of the economic useful lives of fixed assets, provisions for bad and doubtful debts. Any revision to accounting estimates is recognised prospectively.

1.4 INVENTORY:

Stock in trade is valued at lower of cost or the closing rate as per the quotation of Recognized Stock Exchange as on the balance sheet date.

1.5 EVENTS OCCURING AFTER BALANCE SHEET DATE :

Material events occurring after the date of Balance sheet are taken into cognizance.

1.6 EXPENDITURE :

Expenses are accounted on the accrual basis and provisions are made for all known losses and liabilities.

1.7 DEPRECIATION:

Depreciation is provided on straight line method on the basis of useful life of each asset setout under Schedule-II of the Companies Act, 2013 on a pro-rata basis.

1.8 REVENUE RECOGNITION:

a) Screening Income:

In cases where the Company has a formal contract with the advertiser or advertising agency, revenue is recognized as specified in the contract.In other cases, revenue is recognized after completion of screening of related advertisement.

b) Project Management/Development Income:

Income is recognized as and when the bill is raised.

1.9 TANGIBLE FIXED ASSETS:

- Fixed assets are stated at cost of acquisition including directly attributable costs for bringing the asset into intended use, less accumulated depreciation, amortization and impairment losses.

- Borrowing costs directly attributable to acquisition or construction of those Fixed assets which necessarily take a substantial period of time to get ready for their intended use are capitalized.

- Expenditure directly relating to expansion is capitalized only if it increases the life or functionality of an asset beyond its original standard of performance.

1.10 INTAGIBLE 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. Intangible assets are amortized on a straight line basis over a period of 3 years, which is estimated to be the useful life of the asset.

1.11 INVESTMENTS:

Long-term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such decline is not temporary in the opinion of the management.

1.12 EMPLOYEES RETIREMENT BENEFITS:

a. Short term employee benefits being all those benefits payable within 12 months of rendering the services such as salaries, house rent allowance & expected cost of bonus are recognised in the period in which the employee renders the related services.

b. Provident fund and Employee State Insurance: The company's contribution to the recognized Provident Fund and ESIC does not arise as the criteria for the number of employees as required by the respective Acts are not met.

c. Ex-gratia: Ex gratia payment to employees is accounted on payment basis

d. Gratuity: The company makes annual contributions to funds administered by trustees and managed by insurance companies for amounts notified by the said insurance companies. The company accounts for the net present value of its obligation for gratuity benefits based on an independent external actuarial valuation determined on the basis of the projected unit cash method carried out annually. Actuarial gains and losses are immediately recognized in the Profit and Loss Account. Provision in respect of leave encashment benefit is made based on accrual basis.

1.13 BORROWING COSTS :

Borrowing costs directly attributable to the acquisition or construction of qualifying fixed assets are capitalised as part of the cost of the assets, upto the date the asset is put to use. Other borrowing costs are charged to the Profit and Loss Account in the year in which they are incurred.

1.14 LEASE:

Asset taken on Lease under which, all the risk and rewards of ownership are effectively retained by the lessor is classified as Operating Lease. Operating lease payments are recognized as an expense on accrual basis in accordance with the respective Lease Agreements under the head "Rent" in notes to statement of profit and loss.

1.15 EARNINGS PER SHARE:

Basic earning per share is computed by dividing the net profit after tax by the weighted average number of equity share outstanding during the period.

The number of shares used in computing Diluted Earnings per Share comprises the weighted average shares considered for deriving basic Earnings per Share, and also the weighted average number of Equity Shares that could have been issued on the conversion of all dilutive potential Equity Shares.

1.16 TAXES ON INCOME:

Tax expense comprises both current and deferred taxes. The current charge for income taxes is calculated in accordance with the relevant tax regulations. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date.

Deferred tax assets are recognized 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. Deferred tax assets are recognized on carry forward of unabsorbed depreciation and tax losses only if there is virtual certainty that such deferred tax assets can be realized against future taxable profits.

Unrecognized deferred tax assets of earlier years are re-assessed and recognized to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realized.

Minimum Alternative tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the statement of profit and loss and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

1.17 IMPAIRMENT OF ASSETS :

At the end of each year, the company determines whether a provision should be made for impairment loss on fixed assets by considering the indications that an impairment loss may have occurred in accordance with A.S-28 "Impairment of Assets" issued by MCA, where the recoverable amount of any fixed asset is lower than its carrying amount, a provision for impairment loss on Fixed asset is made for the difference, if any.

Since there is no Impairment loss recognized during the previous year, the effect for the same has not been given in the Financial Statements.

1.18 CONTINGENT LIABILITIES:

Depending upon the facts of each case and after due evaluation of legal aspects, claims against the Company not acknowledged as debts are treated as contingent liabilities and the same is disclosed in notes.

The Company has only one class of shares referred to as equity shares having a par value of Re.1/-. Each holder of equity shares is entitled to one vote per share held.

The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting.

Dividend, if approved, is payable to the shareholders in proportion to their shareholding. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company.

The distribution will be in proportion to the number of equity shares held by the shareholders.


Jun 30, 2011

The financial statements are prepared on the accrual basis of accounting and in accordance with the applicable mandatory Accounting Standards and the relevant provisions of the Companies Act 1956.

(a) Fixed assets and depreciation:

i) Fixed assets are stated at cost less accumulated depreciation.

ii) The Company capitalizes all costs relating to the acquisition and installation of fixed assets,

iii) Depreciation on fixed assets is calculated based on straight-line method, prorata to the period of use of assets in the manner specified in Schedule XIV to the Companies Act, 1956, at the rates prescribed there in.

(b) Retirement Benefits: Provident Fund & Employee State Insurance - The Company has not made any contributions towards such funds, as the provisions of the said act are not applicable. Gratuity - The Company has not made provision for Gratuity as none of the employees currently employed with the company have met the criteria as defined under the Gratuity Act of 1972. Leave Encashment - The Company does not have any policy for encashment of leave. Hence the company has not made any provision for leave encashment.

(c) Inventories: The Company has not carried any stock during and as at the end of the year and hence the question of valuation of inventories does not arise.

(d) Earnings Per Share:

i) Basic Earnings per share is calculated by dividing the net earning available to the Equity Shareholders by the weighted average number of Equity Shares outstanding during the year.

ii) Diluted Earnings per share is calculated by dividing the net earnings available to existing and potential Equity Shareholders by aggregate of the weighted average number of Equity Shares considered for deriving basic earnings per share.

(e) Income Recognition: Screening Income: In cases where the Company has a formal contract with the advertiser or advertising agency, revenue is recognized as specified in the contract. In other cases, revenue is recognized after completion of screening of related advertisement.

Project Management/Development Income:

Income is recognized as and when the bill is raised.

(f) Deferred Taxes:

The net result of the deferred tax is the Deferred Tax Asset. However, Deferred Tax Assets are not recognized on the unabsorbed business and depreciation losses as the company is not reasonably certain that there will be a sufficient- future taxable business income to recover such losses.

(g) Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profits before tax is adjusted for the effects of transactions of a non-cash nature and the changes during the period in inventories and operating receivables and payables. The cash flows from regular revenue generating, investing and financing activities of the Company are shown separately.

(h) Impairment of Assets:

The Company assessed its fixed assets for impairment as at 30th June, 2011 and concluded that there has been no significant impaired fixed asset that needs to be recognized in the books of account.


Jun 30, 2010

The financial statements are prepared on the accrual basis of accounting and in accordance with the applicable mandatory Accounting Standards and the relevant provisions of the Companies Act 1956.

(a) Fixed assets and depreciation:

I. Fixed assets are stated at cost less accumulated depreciation.

II. The Company capitalizes all costs relating to the acquisition and installation of fixed assets.

III. Depreciation on fixed assets is calculated based on straight-line method, prorata to the period of use of assets in the manner specified in Schedule XIV to the Companies Act, 1956, at the rates prescribed there in.

(b) Retirement Benefits:

Provident Fund & Employee State Insurance - The Company has not made any contributions towards such funds, as the provisions of the said act are not applicable.

Gratuity - The Company has not made provision for Gratuity as none of the employees currently employed with the company have met the criteria as defined under the Gratuity Act of 1972.

Leave Encashment - The Company does not have any policy for encashment of leave. Hence the company has not made any provision for leave encashment.

(c) inventories:

The Company has not carried any stock during and as at the end of the year and hence the question of valuation of inventories does not arise.

Earnings Per Share:

i. Basic Earnings per share is calculated by dividing the net earning available to the Equity Shareholders by the weighted average number of Equity Shares outstanding during the year.

ii. Diluted Earnings per share is calculated by dividing the net earnings available to existing and potential Equity Shareholders by aggregate of the weighted average number of Equity Shares considered for deriving basic earnings per share.

(d) Income Recognition:

Screening Income:

In cases where the Company has a formal contract with the advertiser or advertising agency, revenue is recognized as specified in the contract.

In other cases, revenue is recognized after completion of screening of related advertisement.

Project Management/Development Income: Income is recognized as and when the bill is raised.

(e) Deferred Taxes:

The net result of the deferred tax is the Deferred Tax Asset. However, Deferred Tax Assets are not recognized on the unabsorbed business and depreciation losses as the company is not reasonably certain that there will be a sufficient future taxable business income to recover such losses.

(f) Cash Flow Statement :

Cash flows are reported using the indirect method, whereby net profits before tax is adjusted for the effects of transactions of a non-cash nature and the changes during the period in inventories and operating receivables and payables. The cash flows from regular revenue generating, investing and financing activities of the Company are shown separately.

(g) Impairment of Assets:

The Company assessed its fixed assets for impairment as at 30th June, 2010 and concluded that there has been no significant impaired fixed asset that needs to be recognized in the books of account.


Jun 30, 2009

The financial statements are prepared on the accrual basis of accounting and in accordance with the applicable mandatory Accounting Standards and the relevant provisions of the Companies Act 1956.

(a) Fixed assets and depreciation:

I. Fixed assets are stated at cost less accumulated depreciation.

II. The Company capitalizes all costs relating to the acquisition and installation of fixed assets.

III. Depreciation on fixed assets is calculated based on straight-line method, prorata to the period of use of assets in the manner specified in Schedule XIV to the Companies Act, 1956, at the rates prescribed there in.

IV. Depreciation on individual low cost assets (costing less than Rs.5, 000) is provided for in full in the year of purchase irrespective of date of installation.

(b) Retirement Benefits:

Provident Fund fr Employee State Insurance - The Company has not made any contributions towards such funds, as the provisions of the said act are not applicable.

Gratuity - The Company has not made provision for Gratuity as none of the employees currently employed with the company have met the criteria as defined under the Gratuity Act of 1972.

Leave Encashment - The Company does not have any policy for encashment of leave. Hence the company has not made any provision for leave encashment.

(c) Inventories:

The Company has not carried any stock during and as at the end of the year and hence the question of valuation of inventories does not arise.

(d) Earnings Per Share:

i. Basic Earnings per share is calculated by dividing the net earning available to the Equity Shareholders by the weighted average number of Equity Shares outstanding during the year.

ii. Diluted Earnings per share is calculated by dividing the net earnings available to existing and potential Equity Shareholders by aggregate of the weighted average number of Equity Shares considered for deriving basic earnings per share.

(e) Income Recognition:

Screening Income:

In cases where the Company has a formal contract with the advertiser or advertising agency, revenue is recognized as specified in the contract. In other cases, revenue is recognized after completion of screening of related advertisement.

Project Management Development Income:

Income is recognized as and when the bill is raised.

(f) Deferred Taxes:

The net result of the deferred tax is the Deferred Tax Asset. However, Deferred Tax Assets are not recognized on the unabsorbed business and depreciation losses as the company is not reasonably certain that there will be a sufficient future taxable business income to recover such losses.

(g) Fringe Benefit Tax :

Consequent to the introduction of Fringe Benefit tax effective April 1, 2005, in accordance with the guidance note on accounting for fringe benefit tax issued by the ICAI, the Company has made provision for Fringe Benefit Tax under Income taxes on accrual basis. (h) Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profits before tax is adjusted for the effects of transactions of a non-cash nature and the changes during the period in inventories and operating receivables and payables. The cash flows from regular revenue generating, investing and financing activities of the Company are shown separately.

(i) Impairment of Assets:

The Company assessed its fixed assets for impairment as at 30th June, 2009 and concluded that there has been no significant impaired fixed asset that needs to be recognized in the books of account.

 
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