Accounting Policies of Ansal Buildwell Ltd. Company

Mar 31, 2016

1 SIGNIFICANT ACCOUNTING POLICIES

A Basis of accounting and preparation of financial statements

These Financial statements have been prepared in accordance with the Indian Generally Accepted Accounting Principles (“Indian GAAP”) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013 (“Act”) read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Act (to the extent notified). The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Use of Estimates

The preparation of the financial statements in conformity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

B Valuation of Inventories

Projects in progress includes the value of materials and stores at sites.

Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or net realizable value

b) Projects in Progress At lower of cost or net realizable value C Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

D Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies The prior period expenses are charged separately to the Statement of Profit and Loss. There is no change in the accounting policy during the year.

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

Intangible Assets

Intangible assets are amortized using straight line method over the estimated useful life, not exceeding 3 years. Amortization method, useful life and residual value are reviewed periodically.

F Revenue Recognition

a) Revenue from constructed properties for all projects commenced on or before March 31, 2012 and where revenue recognition commenced on or before the above date, is recognized in accordance with the provisions of Accounting Standard (AS) 9 on Revenue Recognition, read with Guidance Note on “Recognition of Revenue by Real Estate Developers”. Revenue is computed based on the “percentage of completion method” and on the percentage of actual project costs incurred thereon to total estimated project cost, subject to such actual cost incurred being 30 percent or more of the total estimated project cost.

Revenue from constructed properties for all projects commenced on or after April 1, 2012 or project where the revenue is recognized for the first time on or after the above date, is recognized in accordance with the Revised Guidence Note issued by the Institute of Chartered Accountants of India (“ICAI”) on “ Accounting of Real Estate Transactions (Revised 2012).” As per this Guidence Note, the Revenue have been recognized on percentage of completion method provided all of the following conditions are met at the reporting date.

- required critical approvals for commencement of the project have been obtained

- at least 25% of estimated construction and development costs (excluding land cost) has been incurred.

- at least 25% of the saleable project area is secured by the Agreements to sell/ application forms (containing silent terms of the agreement to sell); and

- at least 10% of the total revenue as per agreement to sell are realized in respect of these agreements.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current years account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on “Cash Basis” owing to practical difficulties and uncertainties involved.

d) Dividend income is recognized when the right to receive the dividend is established.

e) Interest income is accounted for on time proportion basis taking into account the amount outstanding and applicable rate of interest.

f) The Company pays interest on refund of registration money received for Future Projects in the eventuality if property is not offered to the buyers and the same is demanded from the Company in the project against which such registration amounts are received. In view of the same interest is charged to the Statement of Profit & Loss only when liability of interest crystallizes.

g) Income from works contracts is recognized on the basis of running bills raised during the year.

h) The Company has not recognized the Revenue and has not charged the Cost incurred during the year of a project in Jammu amounting to Rs. 43,75,661/- in the Statement of Profit and Loss since the matter is under litigation and the same is postponed in accordance with para 10 read with para

11 of Accounting Standard 9 regarding “Revenue Recognition” because of the significant uncertainty of consideration and ultimate collection from the said project.

G Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred up to the date the asset is put to use. Assets costing less than Rs. 5,000/- are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

H The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Gains/ losses arising due to fluctuation, if any, in the exchange rates are recognized in the Statement of Profit & Loss in the period in which they arise. There is no gain or loss on account of exchange difference during the year.

I Accounting for 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognize the decline.

J Employee Benefits

a) Employee Benefits include provident fund, employee state insurance scheme, gratuity fund and leave encashment.

b) Defined Contribution Plans

The Company’s contribution to provident fund and employee state insurance scheme are considered as defined contribution plans and are charged as an expense to the Statement of Profit and Loss based on the amount of contribution required to be made.

c) Defined Benefit Plans

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognized in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognized immediately to the extent that the benefits are already vested and otherwise is amortized on a straight-line basis over the average period until the benefits become vested.

d) Leave Encashment

Liability in respect of leave encashment becoming due or expected to be availed within twelve months from the balance sheet date is recognized on the basis of undiscounted value of estimated amount required to be paid or estimated value of benefit expected to be availed by the employees. Liability in respect of leave encashment not becoming due or expected to be availed more than twelve months after the balance sheet date is estimated on the basis of an actuarial valuation performed by an independent actuary using the projected unit credit method.

K Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost. Borrowing Costs are determined in accordance with the provisions of AS-16. Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

L Segment Reporting

Having regard to the integrated nature of the Real Estate Development business of the company, the disclosure requirement of “Segment Reporting” pursuant to the Accounting Standard (AS-17) is not applicable.

M Related Party Disclosure

The Details are stated in Note-34 “Related Party Transactions” below which are not reproduced here. N Leases

Financial Lease :

The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard (AS-19) on “Leases”.

Operating Lease :

Leases where the less or effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Lease Rentals under Operating lease are recognized in the statement of profit and loss on a straight-line basis over the lease term.

O Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the post-tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average number of 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.

The details are stated in Note-30 “Earnings Per Share” below which are not reproduced here.

P Consolidated Financial Statements

Consolidated financial statements of the company, its subsidiaries, Joint Ventures and Associates Companies, all incorporated in India, are enclosed separately.

Q Accounting for Taxes on Income In come Tax

Income-tax expense comprises of Current tax being amount of tax determined in accordance with the Income Tax Act, 1961. A provision is made for income-tax annually.

Deferred Tax

a) Current Tax is determined as the amount of tax payable as per Income Tax Act, 1961

b) Deferred Tax is recognized, subject to the consideration of prudence, on timing differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystallize.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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.

R Intangible Assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortization/ depletion. Cost comprises the acquisition price, development cost and any attributable / allocable incidental cost of bringing the asset to its working condition for its intended use.

S Financial Reporting of Interests in Joint Ventures

The management has applied Accounting Standard (AS) 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture’s assets, liabilities, income and expenses in the financial statements of venture, regardless of the structures or forms under which the joint venture activities take place. The details are stated in Note-36 “Interests in Joint Ventures” below which are not reproduced here.

T Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the company’s fixed assets. If any such indication exist the asset’s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds it’s recoverable amount. After the recognition of impairment loss the depreciation charged for the assets is adjusted in future periods to allocate the asset’s revised carrying amount less the residual value, if any, on the written down value basis over it’s useful remaining life.

U Provisions, Contingent Liabilities and Contingent Assets

The company recognizes a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources or where the same cannot be reliably estimated.

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Mar 31, 2015

A Basis of accounting and preparation of financial statements

These Financial statements have been prepared in accordance with the Indian Generally Accepted Acounting Principles ("Indian GAAP") to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013 ("Act") read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Act (to the extent notified). The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Use of Estimates

The preparation of the financial statements in confirmity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

B Valuation of Inventories

Projects in progress includes the value of materials and stores at sites.

Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or net realizable value

b) Projects in Progress At lower of cost or net realizable value

C Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

D Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

The prior period expenses are charged separately to the Statement of Profit and Loss. There is no change in the accounting policy during the year.

E Depreciation and Amortisation

Tangible Assets

Depreciation on tangible assets is provided on the Written Down Value Method over the useful lives of the assets as prescribed under Schedule-II of the Companies Act, 2013. Depreciation for assets purchased / sold during a period is proportionately charged. The useful lives of the assets as per Schedule-II of the Companies Act, 2013 as follows:

Class of Asset Useful Life

Air Conditioners & Refrigerators 15 Years

End user devices (Desktops, Laptops, etc.) 3 Years

Servers & Networks 6 Years

Furniture, Fixtures & Fittings 10 Years

Office Equipments 5 Years

Plant & Machinery (General) 15 Years

Plant & Machinery (Construction) 12 Years

Motor Vehicles (Motor Cycles, Scooters / Other Motor Vehicles) 10 Years / 8 Years

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

Intangible Assets

Intangible assets are amortised using straight line method over the estimated useful life, not exceeding 3 years. Amortisation method, useful life and residual value are reviewed periodically.

F Revenue Recognition

a) Revenue from constructed properties for all projects commenced on or before March 31, 2012 and where revenue recognition commenced on or before the above date, is recognized in accordance with the provisions of Accounting Standard (AS) 9 on Revenue Recognition, read with Guidence Note on "Recognition of Revenue by Real Estate Developers". Revenue is computed based on the "percentage of completion method" and on the percentage of actual project costs incurred thereon to total estimated project cost, subject to such actual cost incurred being 30 percent or more of the total estimated project cost.

Revenue from constructed properties for all projects commenced on or after April 1, 2012 or project where the revenue is recognized for the first time on or after the above date, is recognized in accordance with the Revised Guidence Note issued by the Institute of Chartered Accountants of India ("ICAI") on " Accounting of Real Estate Transactions (Revised 2012)." As per this Guidence Note, the Revenue have been recognized on percentage of completion method provided all of the following conditions are met at the reporting date.

* required critical approvals for commencement of the project have been obtained

* atleast 25% of estimated construction and development costs (excluding land cost) has been incurred.

* atleast 25% of the saleable project area is secured by the Agreements to sell/ application forms (containing silent terms of the agreement to sell); and

* atleast 10% of the total revenue as per agreement to sell are realized in respect of these agreements.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current years account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on "Cash Basis" owing to practical difficulties and uncertainties involved.

d) Dividend income is recognised when the right to receive the dividend is established.

e) Interest income is accounted for on time proportion basis taking into account the amount outstanding and applicable rate of interest.

f) The Company pays interest on refund of registration money received for Future Projects in the eventuality if property is not offered to the buyers and the same is demanded from the Company in the project against which such registration amounts are received. In view of the same interest is charged to the Statement of Profit & Loss only when liability of interest crystalizes.

g) Income from works contracts is recognised on the basis of running bills raised during the year.

G Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred upto the date the asset is put to use. Assets costing less than Rs. 5,000/- are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

H The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Gains/ losses arising due to fluctuation, if any, in the exchange rates are recognised in the Statement of Profit & Loss in the period in which they arise. There is no gain or loss on account of exchange difference during the year.

I Accounting for Investments

Investments that are readily realisable 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognise the decline.

J Employee Benefits

a) Employee Benefits include provident fund, employee state insurance scheme, gratuity fund and leave encashment.

b) Defined Contribution Plans

The Company's contribution to provident fund and employee state insurance scheme are considered as defined contribution plans and are charged as an expense to the Statement of Profit and Loss based on the amount of contribution required to be made.

c) Defined Benefit Plans

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested.

d) Leave Encashment

Liability in respect of leave encashment becoming due or expected to be availed within twelve months from the balance sheet date is recognised on the basis of undiscounted value of estimated amount required to be paid or estimated value of benefit expected to be availed by the employees. Liability in respect of leave encashment not becoming due or expected to be availed more than twelve months after the balance sheet date is estimated on the basis of an actuarial valuation performed by an independent actuary using the projected unit credit method.

K Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost.

Borrowing Costs are determined in accordance with the provisions of AS-16. Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to the Statement of Profit and Loss. L Segment Reporting

Having regard to the integrated nature of the Real Estate Development business of the company, the disclosure requirement of "Segment Reporting" pursuant to the Accounting Standard (AS-17) is not applicable.

M Related Party Disclosure

The Details are stated in Note-34 "Related Party Transactions" below which are not reproduced here.

N Leases

Financial Lease :

The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard (AS-19) on "Leases".

Operating Lease :

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term 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.

O Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the post-tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average number of 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.

The details are stated in Note-30 "Earnings Per Share" below which are not reproduced here.

P Consolidated Financial Statements

Consolidated financial statements of the company, its subsidiaries, Joint Ventures and Associates Companies, all incorporated in India, are enclosed separately.

Q Accounting for Taxes on Income

Income Tax

Income-tax expense comprises of Current tax being amount of tax determined in accordance with the Income Tax Act, 1961. A provision is made for income-tax annually.

Deferred Tax

a) Current Tax is determined as the amount of tax payable as per Income Tax Act, 1961

b) Deferred Tax is recognized, subject to the consideration of prudence, on timing differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystalise.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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 realised. 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.

R Intangible Assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortisation/depletion. Cost comprises the acquisition price, development cost and any attributable/allocable incidental cost of bringing the asset to its working condition for its intended use.

S Financial Reporting of Interests in Joint Ventures

The management has applied Accounting Standard (AS) 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture's assets, liabilities, income and expenses in the financial statements of venturer, regardless of the structures or forms under which the joint venture activities take place. The details are stated in Note-36 "Interests in Joint Ventures" below which are not reproduced here.

T Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the company's fixed assets. If any such indication exist the asset's recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds it's recoverable amount. After the recognition of impairment loss the depreciation charged for the assets is adjusted in future periods to allocate the asset's revised carrying amount less the residual value, if any, on the written down value basis over it's useful remaining life.

U Provisions, Contingent Liabilities and Contingent Assets

The company recognises a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources or where the same cannot be reliably estimated.

Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.

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Mar 31, 2014

A Basis of accounting and preparation of financial statements

The Financial statements are prepared and presented under the historical cost convention on the accrual basis of accounting and Generally Accepted Acounting Principles (GAAP) which include compliance with the Acounting Standards prescribed by the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956, to the extent applicable. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Use of Estimates

The preparation of the financial statements in confirmity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

B Valuation of Inventories

Projects in progress includes the value of materials and stores at sites.

Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or net realizable value

b) Projects in Progress At lower of cost or net realizable value

C Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

D Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

The prior period expenses are charged separately to the profit and loss account, except relating to sites and construction divisions, which have been charged to Work in Progress. There is no change in the accounting policy during the year.

E Depreciation and Amortisation Tangible Assets

Depreciation is provided on Written Down Value method on pro-rata basis at the rates as prescribed in Schedule XIV of the Companies Act, 1956 for the period the assets are held by the Company. The same are as given below:

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

Intangible Assets

Intangible assets are amortised using straight line method over the estimated useful life, not exceeding 3 years. Computer Software Licenses are amortised over a period of 3 years. Amortisation method, useful life and residual value are reviewed periodically.

F Revenue Recognition

a) The company follows "Percentage of Completion method" of accounting under which Sales Turnover and corresponding Profit/ Loss on each project in progress is accounted for at the year end in the proportion that the actual cost incurred bears to the total estimated cost of such project, subject to actual cost being 30% or more of total estimated cost.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current years account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on "Cash Basis" owing to practical difficulties and uncertainties involved.

d) Dividend income is recognised when the right to receive the dividend is established.

e) Interest income is accounted for on time proportion basis taking into account the amount outstanding and applicable rate of interest.

f) The Company pays interest on refund of registration money received for Future Projects in the eventuality if property is not offered to the buyers and the same is demanded from the Company in the project against which such registration amounts are received. In view of the same interest is charged to the Statement of Profit & Loss only when liability of interest crystalizes.

g) Income from works contracts is recognised on the basis of running bills raised during the year. The related costs there against are charged to the Statement of Profit & Loss.

h) Indirect costs are treated as "Period Costs" and are charged to the Statement of Profit and Loss in the year in which they are incurred.

G Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred upto the date the asset is put to use. Assets costing less than '' 5,000/- are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

H The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Gains/ losses arising due to fluctuation, if any, in the exchange rates are recognised in the Statement of Profit & Loss in the period in which they arise. There is no gain or loss on account of exchange difference during the year.

I Accounting for Investments

Investments that are readily realisable 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognise the decline.

J Employee Benefits

a) Employee Benefits include provident fund, employee state insurance scheme, gratuity fund and leave encashment.

b) Defined Contribution Plans

The Company''s contribution to provident fund and employee state insurance scheme are considered as defined contribution plans and are charged as an expense to the Statement of Profit and Loss based on the amount of contribution required to be made.

c) Defined Benefit Plans

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested.

d) Leave Encashment

Liability in respect of leave encashment becoming due or expected to be availed within twelve months from the balance sheet date is recognised on the basis of undiscounted value of estimated amount required to be paid or estimated value of benefit expected to be availed by the employees. Liability in respect of leave encashment not becoming due or expected to be availed more than twelve months after the balance sheet date is estimated on the basis of an actuarial valuation performed by an independent actuary using the projected unit credit method.

K Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost.

Borrowing Costs are determined in accordance with the provisions of AS-16. Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

L Segment Reporting

a) Having regard to the integrated nature of the Real Estate Development business of the company, the disclosure requirement of "Segment Reporting" pursuant to the Accounting Standard (AS-17) is not applicable.

b) The company''s Construction business, in terms of revenue, result and asset empolyed, is not reportable segment as per the Accounting Standard (AS-17) on "Segment Reporting".

M Related Party Disclosure

The Details are stated in Note-34 "Related Party Transactions" below which are not reproduced here.

N Leases

Financial Lease :

The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard (AS-19) on "Leases".

Operating Lease :

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

O Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the post-tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares 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. The details are stated in Note-30 "Earnings Per Share" below which are not reproduced here.

P Consolidated Financial Statements

Consolidated financial statements of the company and its subsidiaries M/s Ansal Real Estate Developers Private Limited, M/s Lancer Resorts and Tours Private Limited, M/s Potent Housing & Construction Private Limited, M/s Sabina Park Resorts and Marketing Private Limited and M/ s Triveni Apartments Private Limited, all incorporated in India, are enclosed separately.

Q Accounting for Taxes on Income

Income Tax

Income-tax expense comprises of current tax being amount of tax determined in accordance with the Income-tax law. A provision is made for income-tax annually.

Deferred Tax

a) Current tax is determined as the amount of tax payable as per Income Tax Act, 1961.

b) Deferred Tax is recognized, subject to the consideration of prudence, on timing differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystalise.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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 realised. 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.

R Intangible Assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortisation /depletion. Cost comprises the acquisition price, development cost and any attributable / allocable incidental cost of bringing the asset to its working condition for its intended use.

S Financial Reporting of Interests in Joint Ventures

The management has applied AS 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture assets, liabilities, income and expenses in the financial statements of venturer, regardless of the structures or forms under which the joint venture activities take place. The details are stated in Note-36 "Interests in Joint Ventures" below which are not reproduced here.

T Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the company''s fixed assets. If any such indication exist the asset''s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds it''s recoverable amount. After the recognition of impairment loss the depreciation charged for the assets is adjusted in future periods to allocate the asset''s revised carrying amount less the residual value, if any, on the written down value basis over it''s useful remaining life.

U Provisions, Contingent Liabilities and Contingent Assets

The company recognises a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources or where the same cannot be reliably estimated.

Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.

(As per the records of the Company, including its register of shareholders / members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.)

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Mar 31, 2012

A Disclosure of Accounting Policies

The Financial statements are prepared and presented under the historical cost convention on the accrual basis of accounting and Generally Accepted Acounting Principles (GAAP) which include compliance with the Acounting Standards prescribed by the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956, to the extent applicable. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Changes in presentation and disclosures of financial statements

During the year ended March 31, 2012, the revised schedule VI notified under the Companies Act, 1956, has become applicable, for preparation and presentation of financial statements. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However it has significant impact on presentation and disclosures made in financial statements. The Company has also reclassified the previous year figures in accordance with the requirements to conform to current year's classification, wherever necessary.

Use of Estimates

The preparation of the financial statements in confirmity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

B Valuation of Inventories

Projects in progress includes the value of materials and stores at sites.

Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or net realizable value

b) Projects in Progress At lower of cost or net realizable value

c) Stores & Spares At lower of cost or net realizable value

C Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

D Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

The prior period expenses are charged separately to the profit and loss account, except relating to sites and construction divisions, which have been charged to Work in Progress. There is no change in the accounting policy during the year.

E Depreciation and Amortisation Tangible Assets

Depreciation is provided on Written Down Value method on pro-rata basis at the rates as prescribed in Schedule XIV of the Companies Act, 1956 for the period the assets are held by the Company.

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

Intangible Assets

Intangible assets are amortised using straight line method over the estimated useful life, not exceeding 3 years. Computer Software Licenses are amortised over a period of 3 years. Amortisation method, useful life and residual value are reviewed periodically.

F Revenue Recognition

a) The company follows "Percentage of Completion method" of accounting under which Sales Turnover and corresponding Profit/ Loss on each project in progress is accounted for at the year end in the proportion that the actual cost incurred bears to the total estimated cost of such project, subject to actual cost being 30% or more of total estimated cost.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current years account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on "Cash Basis" owing to practical difficulties and uncertainties involved.

d) Dividend income is recognised when the right to receive the dividend is established.

e) The Company pays interest on refund of Registration money received for Future Projects in the eventuality if property is not offered to them by the Company in the project against which such registration amounts are received. In view of the same interest is charged to Profit & Loss Account only when liability of interest crystalizes.

f) Income from works contracts is recognised on the basis of running bills raised during the year. The related costs there against are charged to the profit & loss account.

g) Indirect costs are treated as "Period Costs" and are charged to Profit and Loss Account in the year in which they are incurred.

G Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred upto the date the asset is put to use. Assets costing less than Rs. 5,000/- are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

H The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Gains/ losses arising due to fluctuation, if any, in the exchange rates are recognised in the Profit & Loss Account in the period in which they arise. There is no gain or loss on account of exchange difference during the year.

I Accounting for Investments

Investments that are readily realisable 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognise the decline.

J Employee Benefits

a) Provisions for Gratuity and Leave Encashment are made on the basis of Actuarial Valuation Certificate for the year ending 31.03.2012, in accordance with AS-15 (Revised 2005) on 'Employee Benefits'.

b) Provident Fund Contribution made during the year are charged to Profit & loss Account.

K Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost.Borrowing Costs are determined in accordance with the provisions of AS-16. Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.During the current year, no borrowing costs were capitalized in accordance with the provisions of AS-16. (Previous Year : NIL)

L Segment Reporting

a) Having regard to the integrated nature of the Real Estate Development business of the company, the disclosure requirement of "Segment Reporting" pursuant to the Accounting Standard (AS- 17) is not applicable.

b) The company's Construction business, in terms of revenue, result and asset empolyed, is not reportable segment as per the Accounting Standard (AS-17) on "Segment Reporting".

M Related Party Disclosure

The Details are stated in Note-34 "Related Party Transactions" below which are not reproduced here.

N Leases

Financial Lease :

The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard (AS-19) on "Leases".

Operating Lease :

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

O Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the

post-tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares 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. The details are stated in Note-30 "Earnings Per Share" below which are not reproduced here.

P Consolidated Financial Statements

Consolidated financial statements of the company and its subsidiaries M/s Ansal Real Estate Developers Private Limited, M/s Lancer Resorts and Tours Private Limited, M/s Potent Housing & Construction Private Limited, M/s Sabina Park Resorts and Marketing Private Limited and M/s Triveni Apartments Private Limited, all incorporated in India, are enclosed separately.

Q Accounting for Taxes on Income

Income Tax

Income-tax expense comprises of current tax being amount of tax determined in accordance with the Income-tax law. A provision is made for income-tax annually.

Deferred Tax

a) Current tax is determined as the amount of tax payable as per Income Tax Act, 1961.

b) Deferred Tax is recognized, subject to the consideration of Prudence, on Timing Differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystalise.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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 realised. 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.

R Intangible Assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortisation /depletion. Cost comprises the acquisition price, development cost and any attributable / allocable incidental cost of bringing the asset to its working condition for its intended use.

S Financial Reporting of Interests in Joint Ventures

The management has applied AS 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture assets, liabilities, income and expenses in the financial statements of venturer, regardless of the structures or forms under which the joint venture activities take place. The details are stated in Note-36 "Interests in Joint Ventures" below which are not reproduced here.

T Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the company's fixed assets. If any such indication exist the asset's recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds it's recoverable amount. After the recognition of impairment loss the

depreciation charged for the assets is adjusted in future periods to allocate the asset's revised carrying amount less the residual value, if any, on the written down value basis over it's useful remaining life.

U Provisions, Contingent Liabilities and Contingent Assets

The company recognises a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources.

Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.

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Mar 31, 2011

1. Disclosure of Accounting Policies

The Financial statements are prepared and presented under the historical cost convention on the accrual basis of accounting and Generally Accepted Acounting Principles (GAAP) which include compliance with the Accounting Standards prescribed by the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956, to the extent applicable. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Use of Estimates

The preparation of the financial statements in confirmity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

2 Valuation of Inventories

Projects in progress includes the value of materials and stores at sites. Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or net realizable value

b) Projects in Progress At lower of cost or net realizable value

c) Stores & Spares At lower of cost or net realizable value

3 Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

4 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

The prior period expenses are charged separately to the profit and loss account, except relating to sites and construction divisions, which have been charged to Work in Progress. There is no change in the accounting policy during the year.

5 Depreciation Accounting

Depreciation is provided on Written Down Value method on pro-rata basis at the rates as prescribed in Schedule XIV of the Companies Act, 1956 for the period the assets are held by the Company. The same are as given below:

Class of Asset Rate of Depreciation

Air Conditioners & Refrigerators 13.91%

Computers 40%

Furniture, Fixtures & Fittings 18.10%

Land 0%

Office Equipments 13.91%

Plant & Machinery 13.91%

Vehicles 25.89%

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

6 Revenue Recognition

a) The company follows "Percentage of Completion method" of accounting under which Sales Turnover and corresponding Profit/ Loss on each project in progress is accounted for at the year end in the proportion that the actual cost incurred bears to the total estimated cost of such project, subject to actual cost being 30% or more of total estimated cost.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current year account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on "Cash Basis" owing to practical difficulties and uncertainties involved.

d) Dividend income is recognised when the right to receive the dividend is established.

e) The Company pays interest on refund of Registration money received for Future Projects in the eventuality if property is not offered to them by the Company in the project against which such registration amounts are received. In view of the same interest is charged to Profit & Loss Account only when liability of interest crystalizes.

f) Income from works contracts is recognised on the basis of running bills raised during the year. The related costs there against are charged to the profit & loss account.

g) Indirect costs (as detailed in Schedule 11) are treated as "Period Costs" and are charged to Profit and Loss Account in the year in which they are incurred.

7 Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred upto the date the asset is put to use. Assets costing less than Rs. 5,000/- are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

8 The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Gains/ losses arising due to fluctuation, if any, in the exchange rates are recognised in the Profit & Loss Account in the period in which they arise. There is no gain or loss on account of exchange difference during the year.

9 Accounting for Investments

Investments that are readily realisable 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognise the decline.

10 Employee Benefits

a) Provisions for Gratuity and Leave Encashment are made on the basis of Actuarial Valuation Certificate for the year ending 31.03.2011, in accordance with AS-15 (Revised 2005) on 'Employee Benefits'.

b) Provident Fund Contribution made during the year are charged to Profit & loss Account.

11 Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost. Borrowing Costs are determined in accordance with the provisions of AS-16.

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

During the current year, no borrowing costs were capitalized in accordance with the provisions of AS-16. (Previous Year : NIL)

12 Segment Reporting

a) Having regard to the integrated nature of the Real Estate Development business of the company, the disclosure requirement of "Segment Reporting" pursuant to the Accounting Standard (AS-17) is not applicable.

b) The company's Construction business, in terms of revenue, result and asset empolyed, is not reportable segment as per the Accounting Standard (AS-17) on "Segment Reporting".

13 Related Party Disclosure

The Details are stated in the financial notes below which are not reproduced here.

14 Leases Financial Lease :

The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard (AS-19) on "Leases".

Operating Lease :

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

15 Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the post-tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares 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. The details are stated in the financial notes below which are not reproduced here.

16 Consolidated Financial Statements

Consolidated financial statements of the company and its subsidiaries M/s Ansal Real Estate Developers Private Limited, M/s Lancer Resorts and Tours Private Limited, M/s Potent Housing & Construction Private Limited, M/s Sabina Park Resorts and Marketing Private Limited and M/s Triveni Apartments Private Limited, all incorporated in India, are enclosed separately.

17 Accounting for Taxes on Income Income Tax

Income-tax expense comprises of current tax being amount of tax determined in accordance with the Income-tax law. A provision is made for income-tax annually.

Deferred Tax

a) Current tax is determined as the amount of tax payable as per Income Tax Act, 1961.

b) Deferred Tax is recognized, subject to the consideration of Prudence, on Timing Differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystalise.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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 realised. 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.

18 Financial Reporting of Interests in Joint Ventures

The management has applied AS 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture assets, liabilities, income and expenses in the financial statements of venturer, regardless of the structures or forms under which the joint venture activities take place. The details are stated in the financial notes below which are not reproduced here.

19 Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the company's fixed assets. If any such indication exist the asset's recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds it's recoverable amount. After the recognition of impairment loss the depreciation charged for the assets is adjusted in future periods to allocate the asset's revised carrying amount less the residual value, if any, on the written down value basis over it's useful remaining life.

20 Provisions, Contingent Liabilities and Contingent Assets

The company recognises a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources.

Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually cetain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.

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Mar 31, 2010

1. Disclosure of Accounting Policies

The Financial statements are prepared and presented under the historical cost convention on the accrual basis of accounting and Generally Accepted Accounting Principles (GAAP) which include compliance with the Acounting Standards prescribed by the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956, to the extent applicable. The management evaluates all the recently issued or revised Accounting Standards on an ongoing basis.

Use of Estimates

The preparation of the financial statements in confirmity with GAAP requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of financial statements and reported amounts of income and expenses during the period. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

2. Valuation of Inventories

Projects in progress includes the value of materials and stores at sites. Inventories are valued as under:

a) Flats/Shops/Houses/Plots At lower of cost or market value

b) Projects in Progress At cost

c) Stores & Spares At cost

3. Cash Flow Statements

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non–cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. The Cash flow statement is separately attached with the Financial Statements of the company.

4. Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

The prior period expenses are charged separately to the profit and loss account, except relating to sites and construction divisions, which have been charged to Work in Progress. There is no change in the accounting policy during the year.

5. Depreciation Accounting

Depreciation is provided on Written Down Value method on pro–rata basis at the rates as prescribed in Schedule XIV of the Companies Act, 1956 for the period the assets are held by the Company. The same are as given below:

Depreciation on car parking spaces is not charged during the year as the management treats the same as Land and not Building.

6 Revenue Recognition

a) The company follows "Percentage of Completion method" of accounting under which Sales Turnover and corresponding Profit/ Loss on each project in progress is accounted for at the year end in the proportion that the actual cost incurred bears to the total estimated cost of such project, subject to actual cost being 30% or more of total estimated cost.

b) The estimates relating to saleable area, sale value, estimated cost etc., are revised and updated periodically by the management and necessary adjustments are made in the current years account.

c) Whereas all income and expenses are accounted for on accrual basis, interest on delayed payments by/to customers against dues are taken into account on "Cash Basis" owing to practical difficulties and uncertainties involved. Dividend income is recognised when the right to receive the dividend is established.

The Company pays interest on refund of Registration money received for Future Projects in the eventuality if property is not offered to them by the Company in the project against which such registration amounts are received. In view of the same interest is charged to Profit & Loss Account only when liability of interest crystalizes.

d) Income from works contracts is recognised on the basis of running bills raised during the year. The related costs there against are charged to the profit & loss account.

e) Indirect costs (as detailed in Schedule 11) are treated as "Period Costs" and are charged to Profit and Loss Account in the year in which they are incurred.

7 Accounting for Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Gross Block of fixed assets are shown at the cost of acquisition, which includes taxes, duties and other identifiable direct expenses incurred upto the date the asset is put to use. Assets costing less than Rs. 5,000/– are fully depreciated in the year of purchase. There was no revaluation of fixed assets carried out during the year.

8 The Effects of Changes in Foreign Exchange Rates

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction.

9 Accounting for Investments

Investments that are readily realisable 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, when there is a decline, other than temporary, in the value of the long term investment, the carrying cost is reduced to recognise the decline.

10 Employee Benefits

a) Provisions for Gratuity and Leave Encashment are made on the basis of Actuarial Valuation Certificate for the year ending 31.03.2010, in accordance with AS–15 (Revised 2005) on ‘Employee Benefits.

b) Provident Fund Contribution made during the year are charged to Profit & Loss Account.

11 Borrowing Costs

Borrowing costs which have a direct nexus and are directly attributable to the projects are charged to the projects and other borrowing costs are treated as periodic cost.

12 Segment Reporting

Having regard to the integrated nature of the Real Estate Development/ Construction business of the company, the requirement of Segment Reporting persuant to AS–17 is not applicable.

13 Related Party Disclosure

The Details are stated in the financial notes below which are not reproduced here.

14 Leases

Operating Lease

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Operating lease payments are recognized as an expense in the profit and loss account on a straight–line basis over the lease term.

15 Earnings Per Share

In determining earnings per share, the Company considers the net profit after tax and includes the post–tax effect of any extraordinary / exceptional item. The number of shares used in

computing basic earnings per share is the weighted average number of shares 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.

The details are stated in the financial notes below which are not reproduced here. There is no diluted Earning per Share as there are no dilutive potential equity shares.

16 Consolidated Financial Statements

Consolidated financial statements of the company and its subsidiary M/s Ansal Chaudhary Developers Private Limited (Nepal), M/s Rahul Buildwell Private Limited (Nepal), M/s Rahul Township Private Limited (Nepal), M/s AC Shelter Private Limited (Nepal), M/s AC Infrastructure & Development Private Limited (Nepal), all of them being incorporated in NEPAL and M/s Ansal Real Estate Developers Pvt Ltd,M/s Lancer Resorts and Tours Pvt Ltd, M/s Potent Housing & Construction Pvt Ltd,M/s Sabina Park Resorts and Marketing Pvt Ltd and M/s Triveni Apartments Pvt Ltd , all incorporated in India, are enclosed separately.

17 Accounting for Taxes on Income

Income Tax

Income–tax expense comprises of current tax being amount of tax determined in accordance with the Income–tax law. A provision is made for income–tax annually, based on the tax liability computed after considering tax allowances and exemptions.

Deferred Tax

a) Current tax is determined as the amount of tax payable as per Income Tax Act, 1961.

b) Deferred Tax is recognized, subject to the consideration of Prudence, on Timing Differences being differences between taxable income and accounting income, that originate in one period and are capable of being reversed in one or more subsequent periods, to the extent the timing differences are expected to crystalise.

c) The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying amount of a 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 realised. 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.

Fringe Benefit Tax

No Provision for Fringe Benefit Tax (FBT) has been made as on 31st March,2010, as the same has been abolished by the Finance Act, 2009.

18 Financial Reporting of Interests in Joint Ventures

The management has applied AS 27, Financial Reporting of Interests in Joint Ventures, in accounting for interests in joint venture and the reporting of joint venture assets, liabilities, income and expenses in the financial statements of venturer, regardless of the structures or forms under which the joint venture activities take place. The details are stated in the financial notes below which are not reproduced here.

19 Impairment of Assets

At the Balance Sheet date an assessment is done to determine whether there is any indication of impairment in the carrying amount of the companys fixed assets. If any such indication exist the assets recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. After the recognition of impairment loss the depreciation charged for the assets is adjusted in future periods to allocate the assets revised carrying amount less the residual value, if any, on the written down value basis over its useful remaining life.

20 Provisions, Contingent Liabilities and Contingent Assets

The company recognises a provision when there is a present obligation as a result of a past event that probable 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 may, but probably will not require an outflow of resources. Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually and if it is virtually cetain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.