Mar 31, 2010
1. Basis of Accounting
The financial statements have been prepared to comply in all material
respects with the mandatory Accounting Standards issued by the
Institute of Chartered Accountants of India and the relevant provisions
of the Companies Act, 1956. The financial statements have been prepared
underthe historical cost convention on an accrual basis. The accounting
policies have been consistently applied by the Company.
2. Use of Estimates
The preparation of financial statements requires making certain
estimates and assumptions necessary for reporting of amounts in the
financial statements and notes thereto. Differences, if any, between
actual and estimates are recognized in the period in which they
materialize.
3. Fixed Assets
Fixed assets are stated at cost, less accumulated depreciation. Cost
comprises of the purchase price and any attributable cost of bringing
the asset to its working condition for its intended use. Financing
costs related to acquisition of fixed assets are also included to the
extent they relate to the period till such assets are ready to be put
to use.
4. Depreciation/Amortisation
a. Depreciation is provided on fixed assets, under Straight Line
Method at rates prescribed in Schedule XIV to the Companies Act, 1956.
Depreciation on additions/deletions during the year is provided on
pro-rata basis.
b. Premiums other expenditure on leasehold land is amortised over the
period of lease.
5. Inventories
a. Raw Material, components, stores and spares and land (stock in
trade) are valued at lower of cost or net realizable value. Cost is
determined on First In First Out (FIFO) basis.
b. Work-in-progress in respect of construction activity is valued at
cost. Cost includes land cost, direct materials and labour and a
proportion of operating overheads including borrowing costs. In case
work is completed for more than 25% of the total work in each case,
work-in-progress is valued inclusive of estimated profit on percentage
completion basis.
c. Finished goods are valued at lower of cost or net realizable value.
Cost includes direct materials and labour and proportion of
manufacturing overheads based on normal operating capacity. Net
realizable value is the estimated selling price in the ordinary course
of business.
d. Stock in Trade /transit is valued at cost.
6 Revenue Recognition
a. Sales are excluding duties and taxes, net of usual trade discounts.
Revenue from sale of goods is recognized on the basis of dispatch of
goods when ownership, risk & reward is transferred to the customers.
b. Sales of construction activity are excluding duties and taxes.
Revenue from sale of property is recognized on transfer of ownership to
the customers. Revenue from construction contracts is recognized on the
basis of bills submitted on certification of work carried out.
c. Revenue from interest is recognized on time proportion basis.
7. Foreign Currency Transactions
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing at the time of transaction.
b. Monetary assets and liabilities denominated in foreign currencies
are translated into rupee currency at the year end. Non-monetary
foreign currency assets are carried at cost.
c. Any gains or losses on account of exchange differences either on
settlement or on transaction are recognized in the profit and loss
account.
8. Retirement benefits and other employee benefits (AS -15)
Retirement benefits and other employee benefits in the form of
Provident Fund and Gratuity are charged to Profit & Loss account of the
year when the contribution to the respective fund is due.
9. Taxation
Tax expense comprises of both current and deferred taxes. Current
income tax is measured at the amount expected to be paid to the tax
authorities in accordance with the Income Tax Act. Deferred income
taxes reflect the combined impact of current year timing differences
between taxable income and accounting income for the year and reversal
of timing differences of earlier years. Deferred tax is measured based
on the tax rates and the tax laws enacted at the balance sheet date.
Deferred tax assets are recognized only to the extent that there is
reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realized.
10. Impairment Loss
As per Accounting Standard AS-28 Impairment of Assets effective from
April 01, 2004, the Company assesses at each Balance Sheet date whether
there is any indication that any asset may be impaired and if such
indication exists, the carrying value of such asset is reduced to its
recoverable amount and a provision is made for such impairment loss in
the Profit and Loss Account.
11. Borrowing Costs
Borrowing Costs attributable to the acquisition and construction of the
qualifying assets are capitalized as part of the cost of respective
assets upto the date when such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to Profit & Loss Account.
12. Earning Per Share
Basic Earning per share is calculated by dividing the net profit for
the year attributable to equity shareholders by the weighted average
number of equity shares outstanding during the year. The Company has
not issued any dilutive potential equity shares and accordingly, the
basic earning per share and diluted earning per share are the same.
13. Provisions, Contingent Liabilities and Contingent Assets
A Provision is recognized when an enterprise has a present obligation
as a result of past event and it is probable that an outflow of
resources will be required to settle the obligation, in respect of
which a reliable estimate can be made. Provisions are not discounted to
their present value and are determined based on best estimate required
to settle the obligation at the balance sheet date. These are reviewed
at each balance sheet date and adjusted to reflect the current best
estimates. Contingent liabilities if material are disclosed by way of
notes to accounts. Contingent assets are not recognized.
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