Dec 31, 2013
1.1 Basis of preparation of financial statements
The financial statements of the Company have been prepared in
accordance with generally accepted accounting principles in India
(Indian GAAP). The Company has prepared these financial statements to
comply in all material respects with the accounting standards notified
under the Companies (Accounting Standards) Rules, 2006, (as amended)
and the relevant provisions of the Companies Act, 1956 & Companies Act
2013. The financial statements have been prepared on an accrual basis
and under the historical cost convention.The accounting policies
adopted in the preparation of financial statements have been
consistently applied by the Company and are consistent with those used
in the previous year except for changes in accounting policies
explained below.
1.1 Use of estimates
The preparation of financial statements in conformity with the
generally accepted accounting principles (''GAAP'') in India requires
management to make estimates and assumptions that affect the reported
amounts of income and expenses of the period, assets and liabilities
and disclosures relating to contingent liabilities as of the date of
the financial statements. Actual results could differ from those
estimates. Any revision to accounting estimates is recognised
prospectively in future periods.
1.3 Operating cycle
The operating cycle is the time between the acquisition of assets for
processing/ trading and their realization in cash or cash equivalent
and the same is considered as a period of 12 months.
2.4 Tangible Fixed Assets And Depreciation
2.4.1 Fixed assets are stated at cost, less accumulated depreciation.
Cost comprises the purchase price and any attributable cost of bringing
the asset to its working condition for its intended use. Financing
costs relating 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.
2.4.2 Depreciation on fixed assets is provided on Straight Line Method
based at the rates specified in Schedule XIV to the Companies Act, 1956
or the rates determined as per the useful lives of the respective
assets, whichever is higher.
2.4.3 Fixed assets individually costing Rs 5,000 or less are fully
depreciated in the year of purchase/ installation. Depreciation on
additions and disposals during the period is provided on a pro-rata
basis.
2.4.4 The cost of leasehold land is amortised over the period of the
lease. Leasehold improvements and assets acquired on finance lease are
amortised over the lease term or useful life, whichever is lower.
2.5 Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses, if any. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized and
expenditure is reflected in the statement of profit and loss in the
year in which the expenditure is incurred, Intangible assets are
amortized on a straight line basis over the estimated useful economic
life. The Company uses a rebuttable presumption that the useful life of
an intangible asset will not exceed ten years from the date when the
asset is available for use.
The amortization period and the amortization method are reviewed at
least at each financial year end. If the expected useful life of the
asset is significantly different from previous estimates, the
amortization period is changed accordingly. If there has been a
significant change in the expected pattern of economic benefits from
the asset, the amortization method is changed to reflect the changed
pattern. Such changes are accounted for in accordance with AS S Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies Gains or losses arising from derecognition of an
intangible asset are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and are
recognized in the statement of profit and loss when the asset is
derecognized.
Goodwill representing non - compete fee is amortized using the
straight-line method over the period of respective agreements for non-
compete fee.
Costs relating to software, which are acguired, are capitalized and
amortized on a straight line basis over the useful lives of three
years.
2.6 Investments
Investments, which are readily realizable and intended to be held for
not more than ore year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments.
On initial recognition, all investments are measured at cost. The cost
comprises purchase price and directly attributable acguisition charges
such as brokerage, fees and duties. If an investment is acquired, or
partly acquired, by the issue of share or other securities, the
acquisition cost is the fair value of the securities issued, if an
investment is acquired in exchange for another asset, the acquisition
is determined by reference to the fair value of the asset given up or
by reference to the fair value of the investment acquired, which is
more clearly evident.
Current investments are carried in the financial statements at lower of
cost and fair value determined on an individual investment basis.
Long-term investments are carried at cost. However, provision for
diminution in value is made to recognize a decline other than temporary
in the value of the investments.
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long-term investments are carried at
cost. However, provision for diminution in value is made to recognize a
decline other than temporary in the value of the investments.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is charged or credited to the
statement of profit and loss.
2.7 Inventories
Inventories have been valued at lower of cost or net realizable value.
Cost is determined on the basis of first-in-first out method.
Net realizable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and estimated
costs necessary to make the sale,
2.8 Cash and cash equivalents
Cash and Cash Equivalents for the purpose of cash flow statement
comprises cash at bank, cheques in hand (other than stale cheques),
cash in hand and short term investments with an original maturity of
three months or less.
2.9 Foreign Currency Transactions
2.9.1 Initial Recognition: Foreign currency transactions are recorded
in the reporting currency, by applying to the foreign currency amount
the exchange rate between the reporting currency and the foreign
currency at the date of the transaction.
2.9.2 Conversion: Foreign currency monetary items are reported using
the closing rate. Non-monetary items, which are carried in terms of
historical cost denominated in a foreign currency, are reported using
the exchange rate at the date of transaction.
2.9.3 Exchange Differences: Exchange differences arising on the
settlement of monetary items at rates different from those at which
they mere initially recorded during the year, or reported in previous
financial statements, are recognized as income or as exDense in the
vear in which thev arise.
2.10 Tax Expenses
Income tax expense comprises current tax as per Income Tax Act, 1961,
fringe benefit tax and deferred tax charge or credit (reflecting the
tax effects of timing differences between accounting income and taxable
income for the period). The deferred tax charge or credit and the
corresponding deferred tax liabilities or assets are recognized using
the tax rates that have been enacted or substantively enacted by the
balance sheet date, Deferred tax assets are recognized only to the
extent there is reasonable certainty that the asset can be realized in
future; however, where there is unabsorbed depreciation or carried
forward loss under taxation laws, deferred tax assets are recognized
only if there is a virtual certainty of realization of such assets.
Deferred tax assets are reviewed as at each balance sheet date and
written down or written up to reflect the amount that is reasonably /
virtually certain, as the case may be, to be realized.
2.11 Revenue Recogntion
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured, In case of outright sales, the revenue is recognized
on dispatch of goods to customers which is incidental to transfer of
significant risks and rewards of ownership. Sales are stated net of
discounts, rebates and returns.
Export sales are recognized on the basis of bill of lading dates and
are accounted for at exchange rates as specified in the bill of lading
documents.
Export incentives under Duty Exemption Pass Book (DEPB) Scheme, Duty
Drawback Scheme, Vishesh Krishi Gram Upaj Yojna (VKGUY), Focus Product
Scheme (FPS) etc., are accounted for on accrual basis, i.e. in the year
of export of goods or in the year export benefits are announced by the
relevant government authority for earlier years, to the extent the
realisation of the same is considered certain by the Company.
Commission is recognized as and when the services are rendered.
Interest Income is recognized on a time proportion basis taking into
account the amount outstanding and the rate applicable.
2.12 Earnings Per Share
Basic earning per share is calculated by dividing the ret profit or
loss for the year attributable to equity shareholders by the weighted
average number of equity shares outstanding during the year.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the year attributable to equity shareholders and the
weighted average number of shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares,
2.13 Employee Benefits
Pursuant to the requirements of AS IS (revised 2005) on "Employee
Benefits", issued by the Institute of Chartered Accountants of India
(the standard), which has become effective from April 1, 2007, the
Company provided for employee benefits as per the revised requirements
of the standard for the current quarter. In respect of the employee
benefits up to December 31, 2013, the actuarial valuation is being
carried out by the management for the recognition of gratuity and leave
encashment liability.
Gratuity has been provided on the basis of provisions of Gratuity Act,
1972 and actuarial assumption used by the actuary and leave encashment
has been provided on the basis of company policy and actuarial
assumption used by the actuary in this regard.
2.14 Commodity Futures contract
The Company enters into commodity futures contracts as a hedge against
stocks and trading commitments and its various trading exposures.
Principal commodities hedged by these contracts are Barley, RM Seed,
Sugar, Ghana & Maize.
Mark-to-market gains/ losses arising from hedging transactions against
physical stocks and trading commitments are accounted for on settlement
of contracts. Against open position not backed by physical stocks and
trading commitments, mark-to-market loss is recognized in the Statement
of profit and loss and gain is not accounted for.
2.15 Lease Rentals
Leases of assets under which all the risk and rewards of ownership are
effectively retained by the lessor are classified as operating leases.
Lease rentals under an operating lease are recognised as an expenses on
a straight - line basis over the lease term or on a systematic basis
that is representative of the time pattern of the user''s benefit.
Sep 30, 2012
1.1 Basis of preparation of financial statements
The financial statements of the Company have been prepared in
accordance with generally accepted accounting principles in India
(Indian GAAP). The Company has prepared these financial statements to
comply in all material respects with the accounting standards notified
under the Companies (Accounting Standards) Rules, 2006, (as amended)
and the relevant provisions of the Companies Act, 1956. The financial
statements have been prepared on an accrual basis and under the
historical cost convention.The accounting policies adopted in the
preparation of financial statements have been consistently applied by
the Company and are consistent with those used in the previous year
except for changes in accounting policies explained below.
1.2 Changes in Accounting Policies
Presentation and disclosure of financial statements - During the year
ended 30 September 2012, the revised Schedule VI notified under the
Companies Act 1956, has become applicable to the Company, for
preparation and presentation of its 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 the
financial statements. The Company has also reclassified the previous
year''s figures in accordance with the requirements applicable in the
current year.
1.3 Use of estimates
The preparation of financial statements in conformity with the
generally accepted accounting principles (''GAAP'') in India requires
management to make estimates and assumptions that affect the reported
amounts of income and expenses of the period, assets and
liabilities and disclosures relating to contingent liabilities as of
the date of the financial statements. Actual results could differ from
those estimates. Any revision to accounting estimates is recognised
prospectively in future periods.
1.4 Operating cycle
The operating cycle is the time between the acquisition of assets for
processing/ trading and their realization in cash or cash equivalent
and the same is considered as a period of 12 months.
1.5 Tangible Fixed Assets And Depreciation
1.5.1 Fixed assets are stated at cost, less accumulated depreciation.
Cost comprises the purchase price and any attributable cost of bringing
the asset to its working condition for its intended use. Financing
costs relating 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.
1.5.2 Depreciation on fixed assets is provided on Straight Line Method
based at the rates specified in Schedule XIV to the Companies Act, 1956
or the rates determined as per the useful lives of the respective
assets, whichever is higher.
1.5.3 Fixed assets individually costing Rs 5,000 or less are fully
depreciated in the year of purchase/ installation. Depreciation on
additions and disposals during the period is provided on a pro-rata
basis.
1.5.4 The cost of leasehold land is amortised over the period of the
lease. Leasehold improvements and assets acquired on finance lease are
amortised over the lease term or useful life, whichever is lower.
1.6 Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses, if any. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized and
expenditure is reflected in the statement of profit and loss in the
year in which the expenditure is incurred.
Intangible assets are amortized on a straight line basis over the
estimated useful economic life. The Company uses a rebuttable
presumption that the useful life of an intangible asset will not exceed
ten years from the date when the asset is available for use.
The amortization period and the amortization method are reviewed at
least at each financial year end. If the expected useful life of the
asset is significantly different from previous estimates, the
amortization period is changed accordingly. If there has been a
significant change in the expected pattern of economic benefits from
the asset, the amortization method is changed to reflect the changed
pattern. Such changes are accounted for in accordance with AS 5 Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies
Gains or losses arising from derecognition of an intangible asset are
measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in the statement of
profit and loss when the asset is derecognized.
Goodwill representing non - compete fee is amortized using the
straight-line method over the period of respective agreements for non-
compete fee.
Costs relating to software, which are acquired, are capitalized and
amortized on a straight line basis over the useful lives of three
years.
1.7 Investments
Investments, which are readily realizable and intended to be held for
not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments.
On initial recognition, all investments are measured at cost. The cost
comprises purchase price and directly attributable acquisition charges
such as brokerage, fees and duties. If an investment is acquired, or
partly acquired, by the issue of share or other securities, the
acquisition cost is the fair value of the securities issued, if an
investment is acquired in exchange for another asset, the acquisition
is determined by reference to the fair value of the asset given up or
by reference to the fair value of the investment acquired, which is
more clearly evident.
Current investments are carried in the financial statements at lower of
cost and fair value determined on an individual investment basis. Long-
term investments are carried at cost. However, provision for diminution
in value is made to recognize a decline other than temporary in the
value of the investments.
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long-term investments are carried at
cost. However, provision for diminution in value is made to recognize a
decline other than temporary in the value of the investments.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is charged or credited to the
statement of profit and loss.
1.8 Inventories
Inventories have been valued at lower of cost or net realizable value.
Cost is determined on the basis of first-in-first out method.
Net realizable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and estimated
costs necessary to make the sale.
1.9 Cash and cash equivalents
Cash and Cash Equivalents for the purpose of cash flow statement
comprises cash at bank, cheques in hand (other than stale cheques),
cash in hand and short term investments with an original maturity of
three months or less.
1.10 Foreign Currency Transactions
1.10.1 Initial Recognition: Foreign currency transactions are recorded
in the reporting currency, by applying to the foreign currency amount
the exchange rate between the reporting currency and the foreign
currency at the date of the transaction.
1.10.2 Conversion: Foreign currency monetary items are reported using
the closing rate. Non-monetary items, which are carried in terms of
historical cost denominated in a foreign currency, are reported using
the exchange rate at the date of transaction.
1.10.3 Exchange Differences: Exchange differences arising on the
settlement of monetary items at rates different from those at which
they were initially recorded during the year, or reported in previous
financial statements, are recognized as income or as expense in the
year in which they arise.
1.11 Tax Expenses
Income tax expense comprises current tax as per Income Tax Act, 1961,
fringe benefit tax and deferred tax charge or credit (reflecting the
tax effects of timing differences between accounting income and taxable
income for the period). The deferred tax charge or credit and the
corresponding deferred tax liabilities or assets are recognized using
the tax rates that have been enacted or substantively enacted by the
balance sheet date.
Deferred tax assets are recognized only to the extent there is
reasonable certainty that the asset can be realized in future; however,
where there is unabsorbed depreciation or carried forward loss under
taxation laws, deferred tax assets are recognized only if there is a
virtual certainty of realization of such assets. Deferred tax assets
are reviewed as at each balance sheet date and written down or written
up to reflect the amount that is reasonably / virtually certain, as the
case may be, to be realized.
1.12 Revenue Recogntion
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
In case of outright sales, the revenue is recognized on dispatch of
goods to customers which is incidental to transfer of significant risks
and rewards of ownership. Sales are stated net of discounts, rebates
and returns.
Export sales are recognized on the basis of bill of lading dates and
are accounted for at exchange rates as specified in the bill of lading
documents.
Export incentives under Duty Exemption Pass Book (DEPB) Scheme, Duty
Drawback Scheme, Vishesh Krishi Gram Upaj Yojna (VKGUY), Focus Product
Scheme (FPS) etc., are accounted for on accrual basis, i.e. in the year
of export of goods or in the year export benefits are announced by the
relevant government authority for earlier years, to the extent the
realisation of the same is considered certain by the Company.
Commission is recognized as and when the services are rendered.
Interest Income is recognized on a time proportion basis taking into
account the amount outstanding and the rate applicable.
1.13 Earnings Per Share
Basic earning per share is calculated by dividing the net profit or
loss for the year attributable to equity shareholders by the weighted
average number of equity shares outstanding during the year.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the year attributable to equity shareholders and the
weighted average number of shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares.
1.14 Employee Benefits
Pursuant to the requirements of AS 15 (revised 2005) on "Employee
Benefits", issued by the Institute of Chartered Accountants of India
(the standard), which has become effective from April 1, 2007, the
Company provided for employee benefits as per the revised requirements
of the standard for the current quarter. In respect of the employee
benefits up to September 30, 2012, the actuarial valuation is being
carried out by the management for the recognition of gratuity and leave
encashment liability.
Gratuity has been provided on the basis of provisions of Gratuity Act,
1972 and actuarial assumption used by the actuary and leave encashment
has been provided on the basis of company policy and actuarial
assumption used by the actuary in this regard.
1.15 Commodity Futures contract
The Company enters into commodity futures contracts as a hedge against
stocks and trading commitments and its various trading exposures.
Principal commodities hedged by these contracts are Barley, RM Seed,
Sugar, Chana & Maize.
Mark-to-market gains/ losses arising from hedging transactions against
physical stocks and trading commitments are accounted for on settlement
of contracts. Against open position not backed by physical stocks and
trading commitments, mark-to-market loss is recognized in the Statement
of profit and loss and gain is not accounted for.
1.16 Lease Rentals
Leases of assets under which all the risk and rewards of ownership are
effectively retained by the lessor are classified as operating leases.
Lease rentals under an operating lease are recognised as an expenses on
a straight - line basis over the lease term or on a systematic basis
that is representative of the time pattern of the user''s benefit.
Sep 30, 2011
A) Nature of Operations
Financial Eyes (India) Limited ('the Company') is engaged in the
business of trading in Agri Commodities / Products.
b) Accounting basis and convention
The financial statements have been prepared to comply in all material
respects with the Accounting Standards notified by Companies
(Accounting Standards) Rules, 2006 and the relevant provisions of the
Companies Act, 1956. The financial statements have been prepared on a
going concern basis under the historical cost convention on an accrual
basis. The accounting policies have been consistently applied by the
Company and are consistent with those used in the previous year.
c) Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
In case of outright sales, the revenue is recognized on dispatch of
goods to customers which is incidental to transfer of significant risks
and rewards of ownership. Sales are stated net of discounts, rebates
and returns.
Export sales are recognized on the basis of bill of lading dates and
are accounted for at exchange rates as specified in the bill of lading
documents.
Export incentives have been accounted for on accrual basis.
d) Fixed Assets
Fixed assets are stated at cost, less accumulated depreciation. Cost
comprises the purchase price and any attributable cost of bringing the
asset to its working condition for its intended use. Financing costs
relating 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.
e) Depreciation
Depreciation on fixed assets is provided on Straight Line Method based
at the rates specified in Schedule XIV to the Companies Act, 1956 or
the rates determined as per the useful lives of the respective assets,
whichever is higher. Individual assets costing less than Rs. 5,000/-
are depreciated at the rate of 100%.
f) Investments
Investments are stated in accordance with Accounting Standard-13 issued
by the Institute of Chartered Accountants of India. Short Term
Investments are stated at cost or market value which ever is less. Long
Term Investments are stated at cost.
g) Inventories
Inventories have been valued at lower of cost or net realizable value.
Cost is determined on the basis of first-in-first-out method.
h) Foreign Currency Transactions
i.) Initial Recognition : Foreign currency transactions are recorded in
the reporting currency, by applying to the foreign currency amount the
exchange rate between the reporting currency and the foreign currency
at the date of the transaction.
ii.) Conversion : Foreign currency monetary items are reported using
the closing rate. Non-monetary items, which are carried in terms of
historical cost denominated in a foreign currency, are reported using
the exchange rate at the date of transaction.
iii.) Exchange Differences : Exchange differences arising on the
settlement of monetary items at rates different from those at which
they were initially recorded during the year, or reported in previous
financial statements, are recognized as income or as expense in the
year in which they arise.
i) Earnings per Share
Basic earnings per share are calculated by dividing the net profit or
loss for the period attributable to equity shareholders (after
deducting attributable taxes) by the weighted average number of equity
shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
j) Taxes on Income
Income tax expense comprises current tax as per Income Tax Act, 1961
and deferred tax charge or credit (reflecting the tax effects of timing
differences between accounting income and taxable income for the
period). The deferred tax charge or credit and the corresponding
deferred tax liabilities or assets are recognized using the tax rates
that have been enacted or substantively enacted by the balance sheet
date.
Deferred tax assets are recognized only to the extent there is
reasonable certainty that the asset can be realized in future; however,
where there is unabsorbed depreciation or carried forward loss under
taxation laws, deferred tax assets are recognized only if there is a
virtual certainty of realization of such assets. Deferred tax assets
are reviewed as at each balance sheet date and written down or written
up to reflect the amount that is reasonably / virtually certain, as the
case may be, to be realized.
k) Employees Benefits
Pursuant to the requirements of AS 15 (revised 2005) on "Employee
Benefits", issued by the Institute of Chartered Accountants of India,
the Company provided for employee benefits as per the requirements of
the standard for the current period. In respect of the employee
benefits up to September 30, 2011, the actuarial valuation is being
carried out by the management for the recognition of gratuity and leave
encashment liability for the period ending 30th September 2011.
Gratuity has been provided on the basis of provisions of the Gratuity
Act, 1972 and actuarial assumption used by the actuary and leave
encashment has been provided on the basis of company policy and
actuarial assumption used by the actuary in this regard.
l) Provisions & Contingencies
The Company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of the 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. When there is a possible obligation or
a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made
Jun 30, 2010
A) Nature Operations
Financial Eyes (India) Limited (the Company) is engaged in the
business of trading in Agri Commodities.
b) Accounting basis and convention
The financial statements are prepared to comply in all material
respects with the mandatory Accounting Standard issued by the Institute
of Chartered Accountants of India (ICAI) and the relevant provisions
of the Companies Act, 1956. The financial statements have been
prepared on a going concern basis under the historical cost convention
on an accrual basis. The accounting policies have been consistently
applied by the Company and are consistent with those used in the
previous year.
c) Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
In case of outright sales, the revenue is recognized on dispatch of
goods to customers which is incidental to transfer of significant risks
and rewards of ownership. Sales are stated net of discounts, rebates
and returns.
Export sales are recognized on the basis of bill of lading dates and
are accounted for at exchange rates as specified in the bill of lading
documents.
Export incentives have been accounted for on accrual basis.
d) Fixed Assets
Fixed assets are stated at cost, less accumulated depreciation. Cost
comprises the purchase price and any attributable cost of bringing the
asset to its working condition for its intended use.
Financing costs relating 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.
e) Depreciation
Depreciation on fixed assets is provided on Straight Line Method based
at the rates specified in Schedule XIV to the Companies Act, 1956 or
the rates determined as per the useful lives of the respective assets,
whichever is higher. Individual assets costing less than Rs. 5,000/-
are depreciated at the rate of 100%.
f) Investments
Investments are stated in accordance with Accounting Standard-13 issued
by the Institute of Chartered Accountants of India.
Short Term Investments are stated at cost or market value which ever is
less.
Long Term Investments are stated at cost.
g) Stock In Trade
Inventories are valued lower of cost or net realizable value. Cost is
determined on the basis of first-in-first-out method.
h) Foreign Currency Transactions
i.) Initial Recognition
Foreign currency transactions are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
ii.) Conversion
Foreign currency monetary items are reported using the closing rate.
Non- monetary items, which are carried in terms of historical cost
denominated in a foreign currency, are reported using the exchange rate
at the date of transaction.
iii.) Exchange Differences
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in previous financial statements, are recognized
as income or as expense in the year in which they arise.
i) Earnings per Share
Basic earnings per share are calculated by dividing the net profit or
loss for the period attributable to equity shareholders (after
deducting attributable taxes) by the weighted average number of equity
shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilative potential equity shares.
j) Taxes on Income
Income tax expense comprises current tax as per Income Tax Act, 1961,
fringe benefit tax and deferred tax charge or credit (reflecting the
tax effects of timing differences between accounting income and taxable
income for the period). The deferred tax charge or credit and the
corresponding deferred tax liabilities or assets are recognized using
the tax rates that have been enacted or substantively enacted by the
balance sheet date.
Deferred tax assets are recognized only to the extent there is
reasonable certainty that the asset can be realized in future; however,
where there is unabsorbed depreciation or carried forward loss under
taxation laws, deferred tax assets are recognized only if there is a
virtual certainty of realization of such assets. Deferred tax assets
are reviewed as at each balance sheet date and written down or written
up to reflect the amount that is reasonably / virtually certain, as the
case may be, to be realized.
k) Employees Benefits
Pursuant to the requirements of AS 15 (revised 2005) on "Employee
Benefits", issued by the Institute of Chartered Accountants of India
(the standard),
which has become effective from April 1, 2007, the Company provided for
employee benefits as per the revised requirements of the standard for
the current quarter. In respect of the employee benefits up to June 30,
2010, the actuarial valuation is being carried out by the management
for the recognition of gratuity and leave encashment liability.
Gratuity has been provided on the basis of provisions of gratuity act
1972 and actuarial assumption used by the actuary and leave encashment
has been provided on the basis of company policy and actuarial
assumption used by the actuary in this regard.
l) Segment Reporting
i.) Segment Revenue & Expenses:
Revenue and Expenses have been identified to a segment on the basis of
relationship of the operating activities of the segment. Revenue &
Expenses which are not allocable to a segment on a reasonable basis
have been disclosed as "Unallocable".
ii.) Segment Assets and Liabilities:
Segment assets and segment liabilities represent assets and liabilities
in respective segments. Assets and liabilities which cannot be
allocated on the reasonable basis have been disclosed as "Unallocable".
m) Provisions & Contingencies
The Company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of the 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. When there is a possible obligation or
a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made.