Mar 31, 2016
1 Corporate information
Neo Infracon Ltd is mainly dealing in Construction Services in respect of Commercial or Industrial Buildings & Civil Structures, Construction of Residential Complex and its place of business i.e. the registered office is situated at 52/52A, Nanubhai Desai Road, 9 Mulji Thakarsi Bldg, Sindhi Lane, Mumbai - 400004
2 Significant accounting policies
a) Basis of preparation of financial statements
The financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting in accordance with the accounting principles generally accepted in India (GAAP) and comply with the Accounting Standards as per Companies (Accounting Standard) Rules, 2006 and the relevant provisions of the Companies Act, 2013 to the extent applicable.
b) Use of estimates
The preparation of financial statements is in conformity with Generally Accepted Accounting Principles (GAAP) and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities on the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.
c) Revenue recognition
a) Revenue from real estate developmental projects under development is recognized based on ''Percentage Completion Method''.
The Percentage Completion Method is applied when the stage of completion of the project reaches a reasonable level of development. For projects that commenced on or after 1st April 2012 or where revenue on a project is being recognized for the first time on or after that date, the threshold for ''reasonable level of development'' is considered to have been met when the criteria specified in the Guidance Note on Accounting for Real Estate Transactions (Revised 2012) issued by the Institute of Chartered Accountants of India are satisfied, i.e., when:
(i) The expenditure incurred on construction and development costs is not less than 25 % of the construction and development costs.
(ii) At least 25% of the saleable project area is secured by contracts or agreements with buyers.
(iii) At least 10 % of the total revenue as per the agreements of sale or any other legally enforceable documents are realized at the reporting date in respect of each of the contracts and it is reasonable to expect that the parties to such contracts will comply with the payment terms as defined in the contracts.
b) Sale of plots and completed units is recognized at the sale consideration when all significant risks and rewards of ownership in the property is transferred to the buyer and are net of adjustments on account of cancellation.
c) Facility charges, management charges, rental, hire charges, sub lease and maintenance income are recognized on accrual basis as per the terms and conditions of relevant agreements.
d) Interest income is recognized on time proportion basis.
d) Inventories
Inventories are valued as under
i) Completed Flats- At lower of Cost or Market Value
ii) Construction Work in progress-At Cost
Construction Work in Progress includes Cost of Land, Construction Cost, allocated Interest and expenses incidental to projects undertaken by the company
e) Investments
Investments are classified into noncurrent investments and current investments. Investments which are intended to be held for more than one year are classified as noncurrent investments and investments which are intended to be held for less than one year, are classified as current investments. Noncurrent investments are stated at cost and a provision for diminution in value of noncurrent investments is made only if the decline is other than temporary in the opinion of the management. Current investments are valued at cost or market/fair value whichever is lower. In case of investments in mutual funds, the net asset value of units is considered as market/fair value.
f) Provisions, Contingent Liabilities and Contingent Asset
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 present obligation in respect of which the likelihood of outflow of resource is remote, no provision or disclosure is made.
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 recognized in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the assets and related income are recognized in the period in which the change occurs.
g) Fixed assets and depreciation
i. Fixed assets are stated at cost of acquisition and installation less accumulated depreciation. Cost is inclusive of freight, duties, levies and any directly attributable cost of bringing the assets to their working condition for intended use.
ii. Depreciation on Fixed Assets is provided on Straight Line Method at the rates and in the manner prescribed in Schedule III to the Companies Act, 12013.
iii. Expenses incurred on Project and other charges during construction period are included under preoperative expenditure (grouped under Capital Work in Progress) and are allocated to the cost of Fixed Assets on the commencement of commercial operations.
h) Retirement benefits Long-Term Employee Benefits:
Defined Benefit Plan:
The company is accounting for Gratutity & Leave Encashment on payment basis. i) Taxation
a. Current Tax:
Provision for tax is based on the taxable profit for the accounting year after taking into consideration the relevant provisions of the Income Tax Act, 1961.
b. Deferred Tax:
Deferred tax resulting from timing difference between accounting and taxable income is accounted for using the tax rates and laws that are enacted or substantively enacted on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent there is a virtual certainty that the asset will be realized in future.
j) Borrowing Cost:
Interest and Finance charges incurred in connection with borrowing of funds, which are incurred for development of long term project are transferred to construction work in progress as a part of cost of Project. Other borrowing costs are recognized as an expense in the period in which they are incurred.
k) Earnings per share
The basic earnings per share is computed by dividing the net profit / loss attributable to the equity shareholders for the period by the weighted average number of equity shares outstanding during the reporting period. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving earnings per share, and also the weighted average number of equity shares, which could have been issued on the conversion of all dilutive potential shares. In computing dilutive earnings per share, only potential equity shares that are dilutive and that reduce profit / loss per share are included.
l) Cash and cash equivalent
Cash and cash equivalent for the purpose of cash flow statement comprised cash at bank and cash in hand and other short term investment with maturity of three months or less.
Mar 31, 2014
A) Basis of preparation of financial statements
The financial statements have been prepared and presented under the
historical cost convention, on the accrual basis of accounting in
accordance with the accounting principles generally accepted in India
(GAAP) and comply with the Accounting Standards as per Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 to the extent applicable.
b) Use of estimates
The preparation of financial statements is in conformity with Generally
Accepted Accounting Principles (GAAP) and requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent liabilities on the
date of the financial statements. The estimates and assumptions used in
the accompanying financial statements are based upon management''s
evaluation of the relevant facts and circumstances as of the date of
the financial statements. Actual results could differ from those
estimates. Any revision to accounting estimates is recognised
prospectively in current and future periods.
c) Revenue recognition
a) Sales are recorded net of trade discounts, sales tax/ value added
tax, rebates and service tax. Revenue from sale of products is
recognised when the significant risks and rewards of ownership of the
goods have passed to the buyer. Revenue is recognised to the extent
that it is probable that the economic benefits will flow to the Company
and can be reliably measured.
b) Incomes from services are recognised as they are rendered based on
agreements/arrangements with the concerned parties.
c) Interest income is recognised on time proportion basis.
d) Inventories
Inventories are valued as under
i) Completed Flats- At lower of Cost or Market Value
ii) Construction Work in progress-At Cost
Construction Work in Progress includes Cost of Land,Construction Cost,
allocated Interest and expenses incidental to projects undertaken by
the company
e) Investments
Investments are classified into non current investments and current
investments. Investments which are intended to be held for more than
one year are classified as non current investments and investments
which are intended to be held for less than one year, are classified as
current investments. Non current investments are stated at cost and a
provision for diminution in value of non current investments is made
only if the decline is other than temporary in the opinion of the
management. Current investments are valued at cost or market/fair value
whichever is lower. In case of investments in mutual funds, the net
asset value of units is considered as market/fair value.
NEO INFRACON LIMITED
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31,2014
f) Provisions, Contingent Liabilities and Contingent Asset
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 present obligation in respect of which the likelihood of
outflow of resource is remote, no provision or disclosure is made.
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 assets and
related income are recognized in the period in which the change occurs.
g) Retirement benefits Long-Term Employee Benefits:
Defined Benefit Plan:
The company is accounting for Gratutity & Leave Encashment on payment
basis.
h) Taxation
a. Current Tax:
Provision for tax is based on the taxable profit for the accounting
year after taking into consideration the relevant provisions of the
Income Tax Act, 1961.
b. Deferred Tax:
Deferred tax resulting from timing difference between accounting and
taxable income is accounted for using the tax rates and laws that are
enacted or substantively enacted on the balance sheet date. The
deferred tax asset is recognised and carried forward only to the extent
there is a virtual certainty that the asset will be realised in future.
i) Borrowing Cost:
Interest and Finance charges incurred in connection with borrowing of
funds,which are incurred for development of long term project are
transferred to construction work in progress as a part of cost of
Project. Other borrowing costs are recognised as an expense in the
period in which they are incurred.
j) Earnings per share
The basic earnings per share is computed by dividing the net profit /
loss attributable to the equity shareholders for the period by the
weighted average number of equity shares outstanding during the
reporting period. The number of shares used in computing diluted
earnings per share comprises the weighted average number of shares
considered for deriving earnings per share, and also the weighted
average number of equity shares, which could have been issued on the
conversion of all dilutive potential shares. In computing dilutive
earnings per share, only potential equity shares that are dilutive and
that reduce profit / loss per share are included.
k) Cash and cash equivalent
Cash and cash equivalent for the purpose of cash flow statement
comprised cash at bank and cash in hand and other short term investment
with maturity of three months or less.
l) Share Issue Expenses
Share Issue Expenses is carried as an asset and is amortised over a
period of 5 years
Mar 31, 2013
(a) Basis of Accounting:_
The financial statement are Prepared in accordance with Indian
Generally Accepted Accounting Principles ("GAAP") under the historical
cost convention, on the accruals basis.
(b) Use of Estimates_
The presentation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made that may affect the reported amount of assets
and liabilities and disclosures relating to contingent liabilities as
at the date of the financial statements and the reported amount of
revenues and expenses during the reported period. Actual results could
differ from those estimated.
(c) Revenue Recognition:
(i) Sale of goods:
Revenue from the sale of goods is recognized when significant risks and
rewards in respect of ownership of the goods are transferred to the
customer, as per the terms of the respective Sales Order.
Property Development business: The Company has decided to follow
completed contract method of accounting for property development
business.
(ii) Interest
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and the rate acceptable.
(iii) Dividend
Dividend Income from investments are recognized when the right to
receive payment established.
(d) Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses. Cost includes all expenditure necessary to bring the
assets to its working conditions for its intended use.
(e) Depreciation and Amortization
Depreciation is provided on the straight line method based as per the
rate specified in Schedules XIV of the Companies Act, 1956 except for
WTG, on useful lives of assets as estimated by the management.
(f) Investments
Long-term investments are carried at cost. However, Provision is made
to recognize, other than temporary, in the value of long-term
investments.
Current Investments are carried at lower of cost and fair values,
determined on individual basis.
(g) Inventories
Inventories are at lower of cost and net realizable value.
Stock of land is valued at lower of cost and net realizable value. Cost
is determined on the weighted average basis, net realizable value is
determined by management using technical estimates.
Inventory of WIP-Construction is valued at cost less cost of sales
worked out on the basis of cost incurred plus cost to be incurred and
transferring proportionate on the base of area of sales
(h) Borrowing Costs . Borrowing costs that are directly attributable
to the acquisition, construction or production of qualifying assets are
capitalized as part of the cost of such assets. A quality asset is one
that necessarily takes substantial period of time to get ready for
intended use. All other borrowing costs are changed to revenue.
(i) Retirement and other employee benefits
The Company has adopted the policy to provide for the Liability for
gratuity and leave encashment benefits on actuarial valuation. Though
the report of Actuarial valuation for the current year has not been
obtained and provision has not been made accordingly.
0) Provisions. Contingent liabilities and contingent Assets.
A Provision is recognized when the Company has a Present obligation as
a result of past events and it is probable that an out flow of
resources will be required to settle the obligation, in respect of
which are reliable estimate can be made. Provisions are not discounted
to their present value and are determined based on estimate required to
settle the obligation at the baling sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates. Contingent liabilities are disclosed by way of Notes to the
account. Contingent assets are not recognized.
(k) Provision for current and deferred tax
Provision for current income tax is made in accordance with the Income
Tax Act,1961. Deferred tax liabilities and assets are recognized at
substantively enacted tax rates, subject to the consideration of
prudence, on timing difference, being the deface between taxable
income and accruing income that original in one period are capable
of reversal in one or more subsequently period.
(I) Impairments
Impairment loss is recognized wherever the carrying amount of an asset
is in excess of its recoverable amount and the same is recognized as an
expense in the statement of Profit and Loss and carrying amount of the
asset is reduced to its recoverable amount.
(m) Earnings Per Share
Basic earnings per Share are calculated by dividing the net profit for
the period attributable to equity shareholders by the weighted average
number of equity shares outstanding during the period. The weighted
average number of equity shares outstanding during the period are
adjusted for any bonus shares issued during the year and also after the
balance sheet date but before the ate the financial statements are
approved by the Board of Directors.
For the purpose of calculating diluted earnings per share, the net
profit for period attributed to equity shareholders and the weight
average number of share outstanding during the period adjusted for the
effects of all dilative potential equity shares.
The number of equity shares are potential dilative equity shares are
adjusted for bonus as appropriate.
Mar 31, 2012
(a) Basis of Accounting:
The financial statement are Prepared in accordance with Indian
Generally Accepted Accounting .
Principles ("GAAP") under the historical cost convention, on the
accruals basis.
(b) Use of Estimates
The presentation of financial statements in confirmity with the
generally accepted accounting principles - requires estimates and
assumptions to be made that may affect the reported amount of assets
and liabilities and disclosures relating to contingent liabilities as
at the date of the financial statements and the reported amount of
revenues and expenses during the reported period. Actual results could
differ from those estimated.
(c) Revenue Recognition:
(i) Sale of goods:
Reveune from the sale of goods is recognized when significant risks and
rewards in respect of ownership of the goods are transferred to the
customer, as per the terms of the respective Sales Order.
Property Development business: The Company has decided to follow
completed contract method of accounting for property development
business.
(ii) Interest
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and the rate acceptable. .
(iii) Dividend
Dividend Income from investments are recognized when the right to
receive payment established.
(d) Fixed Assets
Fixed Assets are stated at cost, iess cu.cumuiai all expenditure
necessary to bring the assets to its working conditions for its
intended use.
(e) Depreciation and Amortization
Depreciation is provided on the straight line method based as per the
rate specified in Schedules XIV of the Companies Act, 1956 except for
WTG, on useful lives of assets as estimated by the management.
(f) Investments
Long-term investments are carried at cost. However, Provision is made
to recognize, other than temporary, in the value of long-term
investments.
Current Investments ar carried at lower of cost and fair values,
determined on individual basis.
(g) Inventories
Inventories are at lower of cost and net realizable value.
Stock of land is valued at lower of cost and net realizable value. Cost
is determined on the weighted average basis, net realizable value is
determined by management using technical estimates.
(h) Borrowing Costs
Borrowing lists that are directly attributable to the acquisition,
construction or production of qualifying assets are capitalized as part
of the cost of such assets. A qulity asset is one that necessarily
takes substantial period of time to get readly for intended use. All
other borrowing costs are changed to revenue.
(i) Retirment and other employee benefits .
The Company has adopted the policy to provide for the Liability for
gratuity and leave encashment benefits on actuarial valuation. Though
the report of Actuarial valuation for the current year has not been
obtained and provision has not been made accordingly.
(j) Provisions. Contingent liabilities and contingent Assets.
A Provision is recognized when the Company has a Present obligation as
a result of past events and it is probable that an out flow of
resources will be required to settle the obligation, in respect of
which are reliable " estimate can be made. Provisions are not
discounted to their present value and are determined .based on 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 are disclosed by way of Notes to
the account Contingent assets are not recognized.
(k) Provision for current and deferred tax
Provision for current income tax is made in accordance with the Income
Tax Act.1961. Deferred tax liabilities and assets are recognized at
substantively enacted tax rates, subject to the consideration of
prudence, on timing difference, beina the difference between taxable
income and accouonting income that original in
of reversal in one or more subsequently period.
(I) Impairments
Impairment loss is recognized wherever the carrying amount of an asset
is in excess of its recoverable amount and the same is recognized as an
expense in the statement of Profit and Loss and carrying amount of the
asset is reduced to its recoverable amount.
(m) Earning Per Share
Basic earnings per Share are calculated by dividing the net profit for
the period attributable to equity shareholders by the weighted average
number of equity shares outstanding during the period. The weighted
average number of equity shares outstanding during the period are
adjusted for any bonus shares issued during the year and also after the
balance sheet date but before the ate the financial statements are
approved bythe Board of Directors.
For the purpose of calculating diluted earnings per share, the net
profit for period attributed to equity shareholders and the weight
average number of share outstanding during the period adjusted for the
effects of all dilaative potenial equity shares.
The number of equity shares are potential dilative equity shares are
adjusted for bonus as appropriate.
(n) Share Issue Expenses
Share issue expenses are redemption premium are adjusted against the
Securities Premium Account as permissble under Section 78(2) of the
Companies Act, 1956, to the extent balance is available for utilization
in the Securities Premium Account. The balance of share issue expenses
is carried as an asset and is amortised over a period of 5 years
Mar 31, 2011
(a) Basis of Accounting: The financial statement are Prepared in
accordance with Indian Generally Accepted Accounting
Principles ("GAAP") under the historical cost convention, on the
accruals basis.
(b) Use Of Estimates The Presentation of Financial statements in
conformity with the generally accepted accounting Principles requires
estimates and assumptions to be made that may affect the reported
amount of assets and liabilities and disclosures relating to contingent
liabilities as at the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimated.
(c ) Revenue Recognition:
Sale of goods
Revenue from sale of goods is recognized when significant risks and
rewards in respect of ownership of the goods are transferred to the
customer, as per the terms of the respective Sales order.
Property Development business: The Company has decided to follow
completed contract method of accounting for property development
business.
Interest
Interest income is recognized on a time proportion basis taking in to
account the amount outstanding and the rate applicable.
Dividend
Dividend Income from investments is recognized when the right to
receive payment is established.
Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses. Cost
includes all expenditure necessary to bring the assets to its working
conditions for its intended use.
Depreciation
Depreciation is provided on the straight line method based as per the
rate specified in the schedules
XIV of the companies Act, 1956 except for the WTG, on useful lives of
assets as estimated by the management.
Investments
Long-term investments are carried at cost. However, Provision is made
to recognize, other than temporary, in the value of long-term
investments.
Current investments are carried at lower of cost and fair values,
determined on individual basis
Inventories
Inventories are at lower of cost and net realizable value.
Stock of land is valued at lower of cost and net realizable value. Cost
is determined on the weighted average basis, net realizable value is
determined by management using technical estimates.
Borrowing Costs
Borrowing lists that are directly attributable to the acquisition,
construction or production of qualifying assets are capitalised as part
of the cost of such assets. A quality asset is one that necessarily
takes substantial period of time to get ready for intended use. All
other borrowing costs are charged to revenue.
Retirement and other employee benefits
The Company has adopted the policy to provide for the Liability for
gratuity and leave encashment benefits on actuarial valuation. Though
the report of Actuarial valuation for the current year has not been
obtained and provision has not been made accordingly.
d) Provisions, Contingent liabilities and contingent Assets.
A Provision is recognized when the Company has a Present obligation as
a result of past events and it is probable that an out flow of
resources will be required to settle the obligation, in respect of
which are reliable estimate can be made. Provisions are not discounted
to their present value and are determined based on 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 are disclosed by way of Notes to the
account. Contingent assets are not recognized.
Taxation
Provision for current income tax is made in accordance with the Income
Tax Act,1961. Deferred tax liabilities and assets are recognized at
substantively enacted tax rates, subject to the consideration of
prudence, on timing difference, being the difference between taxable
income and accounting income that original in one period and are
capable of reversal in one or more subsequently period.
e) Impairment
Impairment loss is recognized wherever the carrying amount of an asset
is in excess of its recoverable amount and the same is recognized as an
expense in the statement of Profit and Loss and carrying amount of the
asset is reduced to its recoverable amount.
f) Earning Per Share
Basic earnings Per Share are calculated by dividing the net profit for
the period attributable to equity shareholders by the weighted average
number of equity shares outstanding during the period. The weighted
average number of equity shares outstanding during the period are
adjusted for any bonus shares issued during the year and also after the
balance sheet date but before the date the financial statements are
approved by the Board Of Directors.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributed to equity shareholders and the weight
average number of share outstanding during the period adjusted for the
effects of all dilative potential equity shares.
The number of equity shares and potential dilative equity shares are
adjusted for bonus as appropriate.
Mar 31, 2010
I (a) Basis of Accounting:
The financial statement are Prepared in accordance with Indian
Generally Accepted Accounting
Principles ("GAAP") under the historical cost convention, on the
accruals basis.
(b) Use Of Estimates The Presentation of Financial statements in
conformity with the generally accepted accounting Principles requires
estimates and assumptions to be made that may affect the reported
amount of assets and liabilities and disclosures relating to contingent
liabilities as at the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimated.
(c ) Revenue Recognition:
Sale of goods
Revenue from sale of goods is recognized when significant risks and
rewards in respect of ownership of the goods are transferred to the
customer, as per the terms of the respective Sales order.
Property Development business: The Company has decided to follow
completed contract method of accounting for property development
business.
Interest
Interest income is recognized on a time proportion basis taking in to
account the amount outstanding and the rate applicable.
Dividend
Dividend Income from investments is recognized when the right to
receive payment is established.
Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses. Cost
includes all expenditure necessary to bring the assets to its working
conditions for its intended use.
Depreciation
Depreciation is provided on the straight line method based as per the
rate specified in the schedules
XIV of the companies Act, 1956 except for the WTG, on useful lives of
assets as estimated by the management.
Investments
Long-term investments are carried at cost. However, Provision is made
to recognize, other than temporary, in the value of long-term
investments.
Current investments are carried at lower of cost and fair values,
determined on individual basis
Inventories
Inventories are at lower of cost and net realizable value.
Stock of land is valued at lower of cost and net realizable value. Cost
is determined on the weighted average basis, net realizable value is
determined by management using technical estimates.
Borrowing Costs
Borrowing lists that are directly attributable to the acquisition,
construction or production of qualifying assets are capitalised as part
of the cost of such assets. A quality asset is one that necessarily
takes substantial period of time to get ready for intended use. All
other borrowing costs are charged to revenue.
Retirement and other employee benefits
The Company has adopted the policy to provide for the Liability for
gratuity and leave encashment benefits on actuarial valuation. Though
the report of Actuarial valuation for the current year has not been
obtained and provision has not been made accordingly.
SCHEDULE - N Notes forming parts of the accounts
j) Provisions, Contingent liabilities and contingent Assets.
A Provision is recognized when the Company has a Present obligation as
a result of past events and it is probable that an out flow of
resources will be required to settle the obligation, in respect of
which are reliable estimate can be made. Provisions are not discounted
to their present value and are determined based on 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 are disclosed by way of Notes to the
account. Contingent assets are not recognized.
Taxation
Provision for current income tax is made in accordance with the Income
Tax Act,1961. Deferred tax liabilities and assets are recognized at
substantively enacted tax rates, subject to the consideration of
prudence, on timing difference, being the difference between taxable
income and accounting income that original in one period and are
capable of reversal in one or more subsequently period.
I) Impairment
Impairment loss is recognized wherever the carrying amount of an asset
is in excess of its recoverable amount and the same is recognized as an
expense in the statement of Profit and Loss and carrying amount of the
asset is reduced to its recoverable amount.
m) Earning Per Share
Basic earnings Per Share are calculated by dividing the net profit for
the period attributable to equity shareholders by the weighted average
number of equity shares outstanding during the period. The weighted
average number of equity shares outstanding during the period are
adjusted for any bonus shares issued during the year and also after the
balance sheet date but before the date the financial statements are
approved by the Board Of Directors.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributed to equity shareholders and the weight
average number of share outstanding during the period adjusted for the
effects of all dilative potential equity shares.
The number of equity shares and potential dilative equity shares are
adjusted for bonus as appropriate.
Mar 31, 2009
(a) Basis of Accounting:
The financial statement are Prepared in accordance with Indian
Generally Accepted Accounting Principles ("GAAP") under the historical
cost convention, on the accruals basis.
(b) Use Of Estimates
The Presentation of Financial statements in conformity with the
generally accepted accounting Principles requires estimates and
assumptions to be made that may affect the reported amount of assets
and liabilities and disclosures relating to contingent liabilities as
at the date of the financial statements and the reported amount of
revenues and expenses during the reporting period. Actual results could
differ from those estimated. é Revenue Recognition:
(i) Sale of goods
Revenue from sale of goods is recognized when significant risks and
rewards in respect of ownership of the goods are transferred to the
customer, as per the terms of the respective Sales order.
(ii) Interest
Interest income is recognized on a time proportion basis taking in to
account the amount outstanding and the rate applicable.
(iii) Dividend
Dividend Income from investments is recognized when the right to
receive payment is established.
(d) Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses. Cost includes all expenditure necessary to bring the
assets to its working conditions for its intended use.
(e) Depreciation
Depreciation is provided on the straight line method based as per the
rate specified in the schedules XIV of the companies Act, 1956 except
for the WTG, on useful lives of assets as estimated by the management.
(f) Investments
Long-term investments are carried at cost. However, Provision is made
to recognize, other than temporary, in the value of long-term
investments. Current investments are carried at lower of cost and fair
values, determined on individual basis
(g) Inventories
Inventories are at lower of cost and net realizable value.
Stock of land is valued at lower of cost and net realizable value.
Cost is determined on the weighted average basis, net realizable value
is determined by management using technical estimates.
(h) Borrowing Costs
Borrowing lists that are directly attributable to the acquisition,
construction or production of qualifying assets are capitalised as part
of the cost of such assets. A quality asset is one that necessarily
takes substantial period of time to get ready for intended use. All
other borrowing costs are charged to revenue.
i) Retirement and other employee benefits
The Company has adopted the policy to provide for the Liability for
gratuity and leave encashment benefits on actuarial valuation.
Actuarial valuation report has been obtained for the liabilities for
gratuity and leave encashment benefits and provision has been made
accordingly.
j) Provisions. Contingent liabilities and contingent Assets.
A Provision is recognized when the Company has a Present obligation as
a result of past events and it is probable that an out flow of
resources will be required to settle the obligation, in respect of
which are reliable estimate can be made. Provisions are not discounted
to their present value and are determined based on 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 are disclosed by way of Notes to the
account. Contingent assets are not recognized.
k) Taxation
Provision for current income tax is made in accordance with the Income
Tax Act, 1961. Deferred tax liabilities and assets are recognized at
substantively enacted tax rates, subject to the consideration of
prudence, on timing difference, being the difference between taxable
income and accounting income that original in one period and are
capable of reversal in one or more subsequently period.
l) Impairment
Impairment loss is recognized wherever the carrying amount of an asset
is in excess of its recoverable amount and the same is recognized as an
expense in the statement of Profit and Loss and carrying amount of the
asset is reduced to its recoverable amount.
m) Earning Per Share
Basic earnings Per Share are calculated by dividing the net profit for
the period attributable to equity shareholders by the weighted average
number of equity shares outstanding during the period. The weighted
average number of equity shares outstanding during the period are
adjusted for any bonus shares issued during the year and also after the
balance sheet date but before the date the financial statements are
approvedby the Board Of Directors.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributed to equity shareholders and the weight
average number of share outstanding during the period adjusted for the
effects of all dilative potential equity shares.
The number of equity shares and potential dilative equity shares are
adjusted for bonus as appropriate.
The Company is in process of appointing a fulltime company secretary,
hence sec.215 of the companies act 1956 is not complied with.