Mar 31, 2015
(a) USE OF ESTIMATES
The preparation of financial statement in conformity with generally
accepted accounting principles require estimate and assumptions to be
made that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities on the date of financial statement
and the reported amounts of revenues and expenses during the reporting
period, actual results could differ from these estimates and difference
between actual results and estimate are recognized in the periods in
which the results are known/materialize.
(b) REVENUE RECOGNITION
The company follows the accrual basis of accounting except in the
following case where the same are recorded on cash basis on
ascertainment of risk and obligation
a. Interest and other dues are recognized on accrual basis except in
the case of income on Non-performing Assets (NPAs) which is recognized,
as and when received, as per the prudential norms prescribed by the
RBI.
b. Dividend declared by the respective companies' up to the close of
the accounting period are accounted for as income, once the right to
receive is established.
(c) CASH FLOW STATEMENT
The cash flow statement is prepared using the "Indirect method set out
in Accounting Standard 3" Cash Flow statement, which presents cash flow
from operating, investing and financing activities of the company. Cash
and cash equivalent presented in the cash flow statement consists of
cash in hand and unencumbered lightly liquid Bank Balance.
(d) FIXED ASSETS
Fixed assets are carried at cost of acquisition or construction (net of
CENVAT where applicable). They are carried at historical cost less
accumulated depreciation.
(e) DEPRECIATION
Depreciation is charged over the estimated useful life of fixed assets
on written down value basis. Depreciation is provided based on useful
life of the assets as prescribed in schedule II to the Companies Act
,2013.
(f) INVESTMENT
All Investments which are held for more than one year from date of
acquisition are classified as long term investment and are carried at
cost.
(g) RETIREMENT BENEFIT
No provision has been made in accounts against liability in respect of
future payment of Gratuity, Leave Encashment, ESI, Provident Fund and
Bonus to employee as in the opinion of the management neither the
Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor
any employee qualifies for entitlement of such benefits.
(h) BORROWING COST
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Borrowing costs relating to working capital are charged
to statement profit and loss as expenses, if any, incurred.
(i) EARNINGS PER SHARE
The company reports basic and diluted earning per shares computed in
accordance with Accounting Standard- 20 -Earning per share. Basic EPS
is calculated by dividing the Net Profit after tax for the year
attributable to equity share holders by the weighted Average number of
Equity Shares outstanding during the year.
(j) PRIOR PERIOD ITEM
Income and expenditure pertaining to prior period which were omitted to
be recorded in last year due to error or omission in books are duly
reflected under head of prior period items in the statement of Profit &
loss of current year.
(k) TAXATION
1) The Provision for wealth tax and current tax has been provided in
accordance with provision of wealth tax Act 1956 and the Income Tax
Act, 1961 respectively.
2) Deferred tax assets and liabilities are recognized on a prudent
basis for future tax consequences of timing differences arising between
the carrying value of assets and liabilities and their respective tax
basis, and carried forward losses. It is measured using tax rates and
tax laws that have been enacted or substantially enacted at the balance
sheet date. The impact of changes in deferred tax assets and
liabilities is recognized in the profit and loss account.
3) Minimum Alternative Tax ('MAT') under the provisions of the
Income-tax Act, 1961 is recognised as current tax in the Statement of
Profit and Loss as per recommendations contained in the guidance notes
issued by ICAI, the credit available under the Act in respect of MAT
paid is recognised as an asset only when and to the extent there is
convincing evidence that the company will pay normal income tax during
the period for which the MAT credit can be carried forward for set-off
against the normal tax liability. MAT credit recognised as an asset is
reviewed at each balance sheet date and written down to the extent the
aforesaid convincing evidence no longer exists.
(l) PROVISION AND CONTINGENCIES
Provisions involving substantial degree of estimation in measurement
are recognized where there is a Present obligation as a result of past
events and it is probable that there will be out flow of resources.
Contingent liabilities are not recognized, but are disclosed in the
notes of accounts, contingent assets are neither recognized nor
disclosed in the financial statement.
(m) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE
Accounting for contingencies (gains and losses) arising out of
contractual obligations, are made only on the basis of mutual
acceptances. Events occurring after the date of the Balance Sheet are
considered up to the date of approval of the accounts by the Board,
where material.
(n) IMPAIRMENT OF ASSETS
Fixed asset are reviewed for impairment whenever events or changes in
circumstances indicates that the carrying amount of assets may not be
recoverable. If such assets are considered to be impaired, the
impairment is recognized by debiting the Profit & Loss Account and is
measured as the amount by which the carrying cost of assets exceeds the
fair value of assets. The impairment loss recognized in prior
accounting period is reversed, if there has been a change in the
estimate of recoverable amount. By virtue of this, Company has carried
out comprehensive exercise, to assess the impairment loss of assets
based on such exercise.
(o) Provision/ Write Off against Loans and Other Credit Facilities
(a) All credit exposures are classified into performing and
non-performing assets as per the RBI guidelines. Further, NPAs are
classified into Sub-Standard, Doubtful & Loss Assets based on the
criteria stipulated by RBI. Provisions are made on Standard,
Sub-Standard and Doubtful Assets at the rates prescribed by RBI. Loss
Assets & Unsecured portion of Doubtful Assets are provided/ written off
as per the RBI guidelines. Additional provisions are made against
specific non-performing assets over and above what is stated above, if
in the opinion of the management, increased provisions are necessary.
(b) NPA Provision has been written back of those accounts whose
recovery is affected during the year.
(p) STATUTORY RESERVES
Company has made an appropriation of Rs.899218.49 (P.Y. Rs.601938.79)
out of the Profit for the year ended 31st March,2015 to the statutory
reserve pursuant to the requirement of RBI guidelines.
Mar 31, 2014
A) Basis of Preparation of Financial Statement
The accompanying financial statement have been prepared and presented
under the historical cost convention and conform in all material
aspects to the Generally Accepted Accounting Principles in India which
encompasses applicable accounting standards notified by the Companies
(Accounting Standards) Rules, 2006, prudential norms for Income
recognition and provision for non performing assets as prescribed by
Reserve Bank of India for Non Banking Financial Companies, complies
with the accounting standards referred to in Section 211 (3C) of the
Companies Act, 1956 read with the General Circular 15 2013 dated 13th
Sept.,2013 of the Ministry of Corporate Affairs in respect of section
133 of the Companies Act, 2013 as adopted consistently by the company
and other statutory provision and regulatory framework. The Company
adopts the accrual concept in the preparation of Accounts.
(b) USE OF ESTIMATES
The preparation of financial statement in conformity with generally
accepted accounting principles require estimate and assumptions to be
made that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities on the date of financial statement
and the reported amounts of revenues and expenses during the reporting
period, actual results could differ from these estimates and difference
between actual results and estimate are recognized in the periods in
which the results are known/ materialize.
(c) REVENUE RECOGNITION
The company follows the accrual basis of accounting except in the
following case where the same are recorded on cash basis on
ascertainment of risk and obligation
a. Interest and other dues are recognized on accrual basis except in
the case of income on Non- performing Assets (NPAs) which is
recognized, as and when received, as per the prudential norms
prescribed by the RBI.
b. Interest on allotment/call money in arrears, on shares, is
accounted as and when received due to practical difficulties.
c. Dividend declared by the respective companies'' up to the close of
the accounting period are accounted for as income, once the right to
receive is established.
(d) CASH FLOW STATEMENT
The cash flow statement is prepared using the "Indirect method set out
in Accounting Standard 3" Cash Flow statement, which presents cash flow
from operating, investing and financing activities of the company. Cash
and cash equivalent presented in the cash flow statement consists of
cash in hand and unencumbered lightly liquid Bank Balance.
(e) FIXED ASSETS
Fixed assets are carried at cost of acquisition or construction (net of
CENVAT where applicable). They are carried at historical cost less
accumulated depreciation.
(f) DEPRECIATION
Depreciation is charged over the estimated useful life of fixed assets
on written down value basis. The rates of depreciation for fixed
assets, which are not lower than the rates prescribed in Schedule XIV
to the Companies Act, 1956.
(g) INVESTMENT
All Investments which are held for more than one year from date of
acquisition are classified as long term investment and are carried at
cost.
(h) RETIREMENT BENEFIT
No provision has been made in accounts against liability in respect of
future payment of Gratuity, Leave Encashment, ESI, Provident Fund and
Bonus to employee as in the opinion of the management neither the
Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor
any employee qualifies for entitlement of such benefits.
(i) BORROWING COST
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Borrowing costs relating to working capital are charged
to profit and loss account as expenses, if any, incurred.
(j) EARNINGS PER SHARE
The company reports basic and diluted earning per shares computed in
accordance with Accounting Standard-20 -Earning per share. Basic EPS is
calculated by dividing the Net Profit after tax for the year
attributable to equity share holders by the weighted Average number of
Equity Shares outstanding during the year.
(k) PRIOR PERIOD ITEM
Income and expenditure pertaining to prior period which were omitted to
be recorded in last year due to error or omission in books are duly
reflected under head of prior period items in the statement of Profit &
loss of current year.
(l) TAXATION
1) The Provision for wealth tax and current tax has been provided in
accordance with provision of wealth tax Act 1956 and the Income Tax
Act, 1961 respectively.
2) Deferred tax assets and liabilities are recognized on a prudent
basis for future tax consequences of timing differences arising between
the carrying value of assets and liabilities and their respective tax
basis, and carried forward losses. It is measured using tax rates and
tax laws that have been enacted or substantially enacted at the balance
sheet date. The impact of changes in deferred tax assets and
liabilities is recognized in the profit and loss account.
3) Minimum Alternative Tax (''MAT'') under the provisions of the
Income-tax Act, 1961 is recognised as current tax in the Statement of
Profit and Loss as per recommendations contained in the guidance notes
issued by ICAI, the credit available under the Act in respect of MAT
paid is recognised as an asset only when and to the extent there is
convincing evidence that the company will pay normal income tax during
the period for which the MAT credit can be carried forward for set-off
against the normal tax liability. MAT credit recognised as an asset is
reviewed at each balance sheet date and written down to the extent the
aforesaid convincing evidence no longer exists.
(m) PROVISION AND CONTINGENCIES
Provisions involving substantial degree of estimation in measurement
are recognized where there is a Present obligation as a result of past
events and it is probable that there will be out flow of resources.
Contingent liabilities are not recognized, but are disclosed in the
notes of accounts, contingent assets are neither recognized nor
disclosed in the financial statement.
(n) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE
Accounting for contingencies (gains and losses) arising out of
contractual obligations, are made only on the basis of mutual
acceptances. Events occurring after the date of the Balance Sheet are
considered up to the date of approval of the accounts by the Board,
where material.
(o) IMPAIRMENT OF ASSETS
Fixed asset are reviewed for impairment whenever events or changes in
circumstances indicates that the carrying amount of assets may not be
recoverable. If such assets are considered to be impaired, the
impairment is recognized by debiting the Profit & Loss Account and is
measured as the amount by which the carrying cost of assets exceeds the
fair value of assets. The impairment loss recognized in prior
accounting period is reversed, if there has been a change in the
estimate of recoverable amount. By virtue of this, Company has carried
out comprehensive exercise, to assess the impairment loss of assets
based on such exercise.
(p) Provision/ Write Off against Loans and Other Credit Facilities
(a) All credit exposures are classified into performing and
non-performing assets as per the RBI guidelines. Further, NPAs are
classified into Sub-Standard, Doubtful & Loss Assets based on the
criteria stipulated by RBI. Provisions are made on Standard,
Sub-Standard and Doubtful Assets at the rates prescribed by RBI. Loss
Assets & Unsecured portion of Doubtful Assets are provided/ written off
as per the RBI guidelines. Additional provisions are made against
specific non-performing assets over and above what is stated above, if
in the opinion of the management, increased provisions are necessary.
(b) NPA Provision has been written back of those accounts whose
recovery is affected during the year.
Mar 31, 2013
(A) Basis of Preparation of Financial Statement
a) The accompanying financial statement have been prepared and
presented under the historical cost convention and conform in all
material aspects to the Generally Accepted Accounting Principles in
India which encompasses applicable accounting standards notified by the
Companies (Accounting Standards) Rules, 2006, prudential norms for
Income recognition and provision for non performing assets as
prescribed by Reserve Bank of India for Non Banking Financial
Companies, complies with the accounting standards referred to in
Section 211 (3C) of the Companies Act, 1956 as adopted consistently by
the company and other statutory provision and regulatory framework..
The Company adopts the accrual concept in the preparation of Accounts.
(b) CURRENT AND NON CURRENT CLASSIFICATION
All Assets and Liabilities are classified into Current and Noncurrent.
ASSETS: - As assets is classified as current when it satisfies any of
the following criteria:
(i) It is expected to be realized in or intended for sale or
consumption in the company normal operating cycle.
(ii) It is held primarily for the purpose of being traded.
(iii) It is expected to be realized within 12 months of the reporting
date or
(iv) It is Cash or Cash equivalent unless it is restricted from being
exchanged or used to settle a liability for at least 12 months after
the reporting date.
Current assets include the current position of the non current
financial assets. All other Assets are classified as Non current.
LIABILITY: - A Liability is classified as current when it satisfies any
of the following criteria:
(i) It is expected to be settled in the companies normal operating
cycle, or
(ii) It is held primarily for the purpose of being traded, or
(iii) It is due to be settled within 12 months after the reporting
date, or
(iv) The company does not have an unconditional right to date
settlement of the liability for at least 12 months after the reporting
date. Term of a liability that could at the option of the counter party
result in its settlement by the issue of equity instrument do not
affected its classification. Current liability includes current
position of the non current financial liabilities all other liabilities
are classified as Noncurrent.
(B) Use of Estimates
The preparation of financial statements require estimates and
assumptions considered in the reported amount of assets and liabilities
(including Contingent liabilities) as of the date of financial
statements and the reported income and expenses during the reporting
period. The management believes that the estimates used in preparation
of financial statement are prudent and reasonable. Future results could
differ from these estimates.
(C) Revenue Recognition
The company follows the accrual basis of accounting except in the
following case where the same are recorded on cash basis on
ascertainment of risk and obligation
a. Interest and other dues are recognized on accrual basis except in
the case of income on Non-performing Assets (NPAs) which is recognized,
as and when received, as per the prudential norms prescribe by the RBI.
b. Interest on allotment/call money in arrears, on shares, are
accounted as and when received due to
(i) Long term Investments are carried at acquisition cost.
(ii) Current investments are carried at the lower of cost or fair value
on an individual basis. However, appreciation if any, within the
category, is available for set off.
(D) Fixed Assets :
Fixed Assets are stated at cost (inclusive of expenses incurred for
acquisition thereof) less accumulated depreciation.
(E) Depreciation :
Depreciation has been provided on WDV method as per the rate and manner
prescribed in Schedule XIV of the Companies Act, 1956.
(F) Investment:
All Investment are held for more than a year from date of acquisition
are classified as long term investment and are carried at cost .
Investment are classified non current investment and same are carried
at carried at Carrying Cost without deducting the diminution in value
of Rs.9986/- of PANJON LTD. of due to temporary in nature in the
opinion of the management.
(G) Retirement Benefit:
No provision has been made in accounts against liability in respect of
future payment of Gratuity, Leave Encashment, ESI, Provident Fund and
Bonus to employee as in the opinion of the management neither the
Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor
any employee qualifies for entitlement of such benefits. Management
further stated that they are in process to determine the retirement
benefit as per As-15 (Revised) and accordingly no provision was made in
the accounts. Further they opined that same will be accounted on
payment basis.
(H) Borrowing Cost:
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Borrowing costs relating to working capital are charged
to profit and loss account as expenses if any incurred.
(I) Earnings per share
The earning considered to ascertain the Company''s EPS comprises the net
profit after tax of the year and includes the past tax effect of any
extra ordinary items.
(J) Prior Period Item
Prior period item (if any) has been separately disclosed in Profit &
Loss Account as per AS-5.
(K) Taxation
Current income tax is measured at the amount expected to be paid to the
tax authorities in accordance with the income tax Act. Deferred tax
Asset is recognized, subject to the consideration of prudence, on
timing difference, being the difference between taxable income and
accounting income/expenditure that originate in one period and are
capable of being reversed in one or more subsequent year(s).Deferred
taxes are reviewed for their carrying values at each balance sheet
dates.
(L) Provision and Contingencies
Provisions involving substantial degree of estimation in measurement
are recognized where there is a present obligation as a result of past
events and if it is probable that there will be out flow of resources
Contingent liabilities are not recognized, but are disclosed in the
notes of accounts, contingent assets are neither recognized nor
disclosed in the financial statement. However In current year , Company
have written back the provision of income tax for assessment year
(2008-09) in the financial statement as per order received in favor of
company. But Income Tax department has filled Second Appeal before ITAT
Indore against 1st Appeal decided in favour of the Company.
(M) Contingencies and Events occurring after the Balance Sheet date.
Accounting for contingencies (gains and losses) arising out of
contractual obligations, are made only on the basis of mutual
acceptances. Events occurring after the date of the Balance Sheet are
considered up to the date of approval of the accounts by the Board,
where material.
(N) Impairment of Assets
An assets is treated as impaired when carrying cost of assets exceeds
its recoverable amount. Thus based on such exercise, there is no
impairment of assets, accordingly no adjustment in respect of loss as
impairment of assets is required to be made in the accounts.
(O) Provision/ Write Off against Loans and Other Credit Facilities
(a) All credit exposures are classified into performing and
non-performing assets as per the RBI guidelines. Further, NPAs are
classified into Sub-Standard, Doubtful & Loss Assets based on the
criteria stipulated by RBI Provisions are made on Standard,
Sub-Standard and Doubtful Assets as the rates prescribed by RBI. Loss
Assets & Unsecured portion of Doubtful Assets are provided/ written off
as per the extent RBI guidelines. Additional provisions are made
against specific non-performing assets over and above what is stated
above, if in the opinion of the management, increase provisions are
necessary.
(b) NPA Provision has been written back of those accounts whose
recovery is affected in during the year.
(P ) PREVIOUS YEAR FIGURES
Mar 31, 2012
(A) Basis of Preparation of Financial Statement
a) The accompanying financial statement have been prepared on a
historical cost convention and conform in all material aspects to the
Generally Accepted Accounting Principles in India which encompasses
applicable accounting standards notified by the Companies (Accounting
Standards) Rules, 2006, prudential norms for Income recognition and
provision for non-performing assets as prescribed by Reserve Bank of
India for Non-Banking Financial Companies, complies with the accounting
standards referred to in Section 211 (3C) of the Companies Act, 1956 as
adopted consistently by the company and other statutory provision and
regulatory framework.. The Company adopts the accrual concept in the
preparation of Accounts.
b) Presentation & disclosure of financial statement
During the year ended 31st march, 2012 the revised schedule VI notified
under the company Act, 1956 has become applicable to the company for
preparation and presentation of its financial statement. The adaption
of revised schedule VI does not impact recognition and measurement
principle followed for preparation of financial statement. However it
has significant impact on presentation and disclosure made in the
financial statement. The company has also declared the previous year
figures in accordance with the requirement applicable in the current
year.
(B) Use of Estimates
The preparation of financial statements require estimates and
assumptions considered in the reported amount of assets and liabilities
(including Contingent liabilities) as of the date of financial
statements and the reported income and expenses during the reporting
period. The management believes that the estimates used in preparation
of financial statement are prudent and reasonable. Future results could
differ from these estimates.
(C) Revenue Recognition
The company follows the accrual basis of accounting except in the
following case where the same are recorded on cash basis on
ascertainment of risk and obligation
a. Interest and other dues are recognized on accrual basis except in
the case of income on Non-performing Assets (NPAs) which is recognized,
as and when received, as per the prudential norms prescribe by the RBI.
b. Interest on allotment/call money in arrears, on shares, are
accounted as and when received due to practical difficulties.
c. Dividend declared by the respective Companies till the close of the
accounting period are accounted for as income, once the right to
receive is established.
(D) Fixed Assets :
Fixed Assets are stated at cost (inclusive of expenses incurred for
acquisition thereof) less accumulated depreciation.
(E) Depreciation :
Depreciation has been provided on WDV method as per the rate and manner
prescribed in Schedule XIV of the Companies Act, 1956.
(F) Investment:
All Investment are held for more than a year from date of acquisition
are classified as long term investment and are carried at cost.
Investments are classified under two categories i.e. current and long
term and are valued in according with the RBI Guidelines as applicable
to Non-Banking Financial Companies (NBFCs) and Accounting Standard 13
on 'Accounting for Investment' as notified by the companies
(accounting Standard) Rules, 2006.
(i) Long term Investments are carried at acquisition cost.
(ii) Current investments are carried at the lower of cost or fair value
on an individual basis. However, appreciation if any, within the
category, is available for set off.
(G) Retirement Benefit:
No provision has been made in accounts against liability in respect of
future payment of Gratuity, Leave Encashment, ESI, Provident Fund and
Bonus to employee as in the opinion of the management neither the
Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor
any employee qualifies for entitlement of such benefits. Management
further stated that they are in process to determine the retirement
benefit as per As-15 (Revised) and accordingly no provision was made in
the accounts. Further they opined that same will be accounted on
payment basis.
(H) Borrowing Cost:
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Borrowing costs relating to working capital are charged
to profit and loss account as expenses if any incurred.
(I) Earnings per share
The earning considered to ascertain the Company's EPS comprises the net
profit after tax of the year and includes the past tax effect of any
extra ordinary items.
(J) Prior Period Item
Prior period item has been separately disclosed in Profit & Loss
Account as per AS-5.
(K) Taxation
Current income tax is measured at the amount expected to be paid to the
tax authorities in accordance with the income tax Act. Deferred tax
Asset is recognized, subject to the consideration of prudence, on
timing difference, being the difference between taxable income and
accounting income/expenditure that originate in one period and are
capable of being reversed in one or more subsequent year(s). Deferred
taxes are reviewed for their carrying values at each balance sheet
dates.
(L) Provision and Contingencies
Provisions involving substantial degree of estimation in measurement
are recognized where there is a present obligation as a result of past
events and if it is probable that there will be out flow of resources
Contingent liabilities are not recognized, but are disclosed in the
notes of accounts, contingent assets are neither recognized nor
disclosed in the financial statement.
(M) Contingencies and Events occurring after the Balance Sheet date.
Accounting for contingencies (gains and losses) arising out of
contractual obligations, are made only on the basis of mutual
acceptances. Events occurring after the date of the Balance Sheet are
considered up to the date of approval of the accounts by the Board,
where material.
(N) Impairment of Assets
An assets is treated as impaired when carrying cost of assets exceeds
its recoverable amount. Thus based on such exercise, there is no
impairment of assets, accordingly no adjustment in respect of loss as
impairment of assets is required to be made in the accounts.
(O) Provision/Write Off against Loans and Other Credit Facilities
(a) All credit exposures are classified into performing and
non-performing assets as per the RBI guidelines. Further, NPAs are
classified into Sub-Standard, Doubtful & Loss Assets based on the
criteria stipulated by RBI Provisions are made on Standard,
Sub-Standard and Doubtful Assets as the rates prescribed by RBI. Loss
Assets & Unsecured portion of Doubtful Assets are provided/written off
as per the extent RBI guidelines. Additional provisions are made
against specific non-performing assets over and above what is stated
above, if in the opinion of the management, increase provisions are
necessary.
(b) NPA Provision has been written back of those accounts whose
recovery is affected in during the year.
Mar 31, 2010
(A) System of Accounting
a. The financial statement have been prepared under the historical
cost convention in accordance with the generally accepted accounting
principles and complies with the accounting standards referred to in
Section 211 (3C) of the Companies Act, 1956 as adopted consistently by
the company. The Company adopts the accrual concept in the preparation
of Accounts.
b. The Company has followed the prudential norms for Income
recognition and provision for non performing assets as prescribed by
Reserve Bank of India for Non Banking Financial Companies.
(B) Revenue Recognition
a. Income & Expenditures are recognized and accounted on accrual
basis. Interest from customer/debtors who are not repaying the
installment/loan are accounted when received and appropriated. Moreover
revenue recognition is postponed to a later year only when it is not
able to estimate if with reasonable accuracy.
b. Interest on allotment/call money in arrears, on shares, are
accounted as and when received due to practical difficulties.
c. Dividend is accounted when the right to receive payment is
established.
d. Income on NPA has been recognized as and when received.
e. Gratuity and Retirement Benefits for the employee are accounted for
on payment basis.
(C) Fixed Assets :
Fixed Assets are stated at cost (inclusive of expenses incurred for
acquisition thereof) less accumulated depreciation.
(D) Depreciation :
Depreciation has been provided on WDV method as per the rate and manner
prescribed in Schedule XIV of the Companies Act, 1956.
(E) Investment:
Investments are classified as Long Term Investment and shown at cost.
No Provision has been made for diminution in the value of investment as
all the investments are long term and in the boards opinion the
decline is temporary.
(G) Non Performing Assets and Provision:
All loan where the installment are over due for more than six months
from the date of demand are classified as non performing assets in
accordance with the prudential norms prescribed by the Reserve Bank of
India Provision for non performing assets has been made as per RBI
Norm. However, the advances by way of loans are stated before provision
for NPA & Doubtful Debts.
(H) Retirement Benefit:
No provision has been made in accounts against liability in respect of
future payment of Gratuity, Leave Encashment, ESI, Provident Fund and
Bonus to employee as in the opinion of the management neither the
Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor
any employee qualifies for entitlement of such benefits. Management
further stated that they are in process to determine the retirement
benefit as per As-15 (Revised) and accordingly no provision was made in
the accounts. Further they opined that same will be accounted on
payment basis.
(I) Borrowing Cost:
Borrowing costs relating to working capital are charged to profit and
loss account as expenses if any incurred.
(J) Earning per share
The earning considered to ascertain the Companys EPS comprises the net
profit after tax of the year and includes the past tax effect of any
extra ordinary items.
(K) Prior Period Item
Prior period item has been separately disclosed in Profit & Loss
Account as per AS-5.
(L) Accounting for taxes on income.
Provision for current tax are computed as per provision under the
Income Tax Act, 1961 Deferred tax liability is recognized if any
subject to the consideration of prudence, on timing difference, being
the difference between taxable income and accounting income that
originate in one period and are capable of being reversed in one or
more subsequent period.
(M) Provision , Contingent liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement
are recognized where there is a present obligation as a result of past
events and if it is probable that there will be out flow of resources
Contingent liabilities are not recognized, but are disclosed in the
notes of accounts, contingent assets are neither recognized nor
disclosed in the financial statement.
(N) Contingencies and Events occurring after the Balance Sheet date.
Accounting for contingencies (gains and losses) arising out of
contractual obligations, are made only on the basis of mutual
acceptances. Events occurring after the date of the Balance Sheet are
considered up to the date of approval of the accounts by the Board,
where material.
(O) Impairment of Assets
An assets is treated as impaired when carrying cost of assets exceeds
its recoverable amount. Thus based on such exercise, there is no
impairment of assets, accordingly no adjustment in respect of loss as
impairment of assets is required to be made in the accounts.
(P) Loans & Advances
Loans & Advances granted by the company are repayable on demand. Hence
the same are not classified between different categories.
(Q) Provision/ Write Off against Loans & Advances and Debtors
(a) All NPA, Loans & Advances & Debtors are classified into
Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated
by RBI. Provision has been made on the Sub-Standard and Doubtful Assets
as the rates prescribed by RBI. Loss Assets & Unsecured portion of
Doubtful Assets are provided/ written off as per the extent RBI
guidelines. Additional provision on some Advances & Debtors has not
been made due to recoverable in the opinion of the Management.
(b) NPA Provision has been written back of those accounts whose
recovery is affected in during the year.
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