Mar 31, 2015
1. BACKGROUND
M/S Purshottam Invest of in Limited ("The Company") was incorporated in
India on 04TH day of November 1988 under the company's act 1956. The
company is registered with Reserve Bank of India (RBI) as a Non-Banking
Financial Company vide certificate No.B-14-01044 dated 14th May 2003.
The company is primarily engaged in the business of NBFC (Non-Accepting
Public Deposits).
a. Basis of preparation of financial statements
The financial statements have been prepared and presented under the
historical cost convention method, on the accrual basis of accounting
and in accordance with the Generally Accepted Accounting Principles
("GAAP") in India, and Accounting Standards Specified under Section 133
of the companies act 2013 (the 'act'), read with rule 7 of the
companies (Accounts) Rules ,2014 (as amended). The accounting policies
have been consistently applied by the company.
Previous year figures have been regrouped/ recast to make them
comparable with figures of current year.
b. Use of estimates
The preparation of financial statements in conformity with the Indian
GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities, disclosure of
contingent liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from these estimates. Any change in the
accounting estimates is recognized prospectively in the current and
future periods.
c. Revenue Recognition
Revenue is recognized on accrual basis
d. Fixed assets
Tangible Assets
Fixed assets are stated at cost of acquisition less accumulated
depreciation and impairment losses if any. The cost of fixed assets
comprises purchase price and any attributable cost of bringing the
asset to its working condition for its intended use.
Intangible Assets
Internally generated intangible asset arising from development activity
are recognized only on demonstration of its feasibility, the intention
and ability of the company to complete, use or sell it. The intangible
assets (if any) are eroded at cost and are carried at cost less
accumulated amortization.
e. Depreciation
Depreciation on fixed assets ought to be in accordance with the
enactment of the Companies Act 2013 (the 'Act'), the Company, effective
1st April 2014, had to review the estimated useful lives of its fixed
assets, generally in accordance with the provisions of Schedule II to
the Act, as follows:
However, depreciation has been charged for the first 9 months of the
year according to Schedule XIV of the Companies Act, 1956 in the
absence of clarity on the application of Schedule II of Companies Act,
2013 and the fixed assets has been disposed off at scrap value on
01.01.2015 resulting in NIL fixed assets as on 31.03.2015 and NIL
depreciation for the 4th quarter of the FY 2014-15.
Moreover, the amount of depreciation charged during the year is not
material which could affect the true and fair view of the state of
affairs of the company for the current financial year
f. Investments
Investments held for maturity (Long term) are stated at cost & any
decline other than temporary, in the value of such investments is
charged to the statements of Profit & Loss. The carrying amount for
Investment held for trade is the lower of cost and fair value.
g. Inventories
Inventories are valued at the lower of cost and net realizable value.
Cost of inventories comprises all cost of purchase, and other costs
incurred in acquiring the inventories. Further the inventories are
valued on FIFO basis.
h. Income Tax Expense
Provision for Income tax expense is determined as the amount of tax
payable in respect of estimated taxable income for the year and in
accordance with the Income-tax Act, 1961. 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 assets can be
realized in future.
i. Employee Benefits:
Company has not made any Provision for liability of future payment of
gratuity as the company does not fulfill the criteria of its
provisions.
No provision has been made for leave encashment benefits, as the
company does not have a policy of encasing leaves of employees.
j. Leases
Lease rentals (if any) in respect of operating lease arrangements are
recognized as an expense in the profit & loss account on accrual basis.
k. Earnings per share
The earnings considered in ascertaining the Company's earnings per
equity share comprises the net profit after tax. The number of shares
used in computing basic EPS is the weighted average number of equity
shares outstanding during the year.
l. Provisions & Contingencies
A provision is recognized when the company has a present obligation as
a result of a past event, when it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation and reliable estimate can be made of the amount of the
obligation. Contingent liabilities and contingent assets are neither
recognized nor disclosed in the financial statements.
m. Foreign exchange transactions
Foreign currency transactions (if any) are recorded using the exchange
rates prevailing on the dates of the respective transactions. Exchange
differences arising on foreign currency transactions settled during the
year are recognised in the Profit and Loss Account. Monetary assets
and liabilities denominated in foreign currencies as at the balance
sheet date are translated at year end rates. The resultant exchange
differences are recognised in the profit and loss account. Non monetary
assets are recorded at the rates prevailing on the date of transaction.
Mar 31, 2014
1.1. Basis of preparation of Accounts
The financial statements have been prepared under the historical cost
convention in accordance with generally accepted accounting policies in
India. The accounting standards notified by the Companies Act 1956 and
the provisions of the Companies Act 1956, as adopted consistently by
the Company.
The company follows the mercantile system of accounting and recognizes
items of incomes and expenditure on accrual basis.
1.2. Presentation and disclosure of financial statements
The financials have been prepared and presented as per the revised
Schedule VI notified under the companies Act 1956.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.
1.3 Use of Estimates
The preparation of financial statements is in conformity with general
accepted accounting principles which require the management of the
company to make estimates and assumptions that affect the reported
balances of assets and liabilities and disclosures relating to the
contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the year. Actual
results could differ from those estimates.
1.4. Taxation
Provision for current tax is determined as the amount of tax payable in
respect of estimated taxable income for the year and in accordance with
the provisions of Income Tax Act, 1961. Deferred tax is recognized
using the enacted tax rates and laws as on the Balance Sheet date,
subject to the consideration of prudence in respect of deferred tax
assets on all timing differences, between taxable income and accounting
income that originate in one period and are capable of reversal in one
of more subsequent periods.
1.5. Earnings per share
The earnings considered in ascertaining the Company''s EPS comprises the
net profit after tax. The number of shares used in computing basic EPS
is the weighted average number of shares outstanding during the period.
1.6. Investments
Investments are stated at cost.
1.7. Revenue Recognition
Revenue is recognized to the extent that it can be reliably measured
and is probable that the economic benefits will flow to the company
1.8. Provisions & Contingencies
A provision is recognized when the company has a present obligation as
a result of a past event, when it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation and reliable estimate can be made of the amount of the
obligation. Contingent Liabilities and Contingent Assets are neither
recognized nor disclosed in the financial statements.
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