Mar 31, 2014
1. Basis of preparation of Financial Statements:
The Financial Statements have been prepared in accordance with the
generally accepted accounting principles (''GAAP'') applicable in India
under the historical cost convention on accrual basis These financial
statements have been prepared to comply in all material aspects with
the accounting standards notified under Section 211 (3C). Companies
(Accounting Standard) Rules, 2006, as amended from time to time and the
other relevant provisions of the Companies Act, 1956.
All Assets and Liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in Schedule VI of the Companies Act, 1956.
2. 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 in accordance with the RBI
guidelines and Accounting Standard 13 on ''Accounting for Investments''
as notified under the companies (Accounting Standards) Rules,
2006.Current investments also include current maturities of long- term
investments. All other investments are classified as non- current
investments. Current investments are carried at lower of cost and
market price determined category- wise All non - current investments
are carried at cost However, provision for diminution in value, other
than temporary in nature, is made to recognize a decline, on an
individual basis.
3. Use of Estimates:
The preparation of Financial Statements in conformity with GAAP
requires that the management of the Company makes estimates and
assumptions that affect the reported amounts of income and expenses of
the period, the reported balances of assets and liabilities and the
disclosures relating to contingent liabilities as of the date of the
financial statements. Actual results could differ from these estimates.
Difference result and estimates are recognized in the period in which
the results are known / materialized. Management believes that the
estimates used in preparation of financial statements are prudent and
reasonable
4. Revenue Recognition:
Income ana expenditure are recognized and accounted on accrual basis as
and when they are earned or incurred. Revenue from sales transaction is
recognized as and when the significant risk and reward attached to
ownership in goods is transferred to the buyer. However leave with
wages and bonus is accounted on cash basis
Profit on sale of investments is recorded on transfer of title from the
company and is determined as the difference between the sale price and
the carrying value of the investment. Interest income is accounted on
accrual basis. Dividend income is accounted for when the right to
receive it is established.
5. Cash Flow Statement:
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and lax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from operating
investing and financing activities of the Company are segregated based
on the available information.
6. Tangible Assets:
Tangible Assets are stated at cost (or revalued amount as the case may
be) less accumulated depreciation and accumulated impairment losses if
any, Cost Comprises purchase price and any other attributable cost of
bringing the asset to its working condition for its intended use
Subsequent expenditure related to an item of fixed asset are added to
its book value only if they increase the future benefits from the
existing asset beyond its previously assessed standard of performance.
Gain or loss arising from de-recognition of assets are measured as the
difference between the net disposal proceeds and the carrying amount of
the assets and are recognized in the statement of profit and loss when
the asset is derecognized
Depreciation on fixed assets is provided on written down value method
(WDV) at the rales and in the manner prescribed in Schedule XIV to the
Companies Act. 1956 over there useful life of asset sold discarded
during the period is proportionately charged. Individual low cost
assets (acquired for less than Rs 5000/-) are depreciated within a year
of acquisition. Intangible assets are amortized over their estimated
useful life on a straight line basis.
7. Employee Benefits:
Short term benefits and post employment benefits are accounted in the
period during which the services have been rendered.
8. Tax Expense:
Tax expenses for the year comprise of current tax and deferred tax
Current tax is measured after taking into consideration the deductions
and exemptions admissible under the provision of Income Tax Act, 1961
and in accordance with Accounting Standard 22 on "Accounting for Taxes
on Income".
Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which
gives future economic benefits in the form of adjustment to future
income tax liability, is considered as an asset if there is convincing
evidence that the Company will pay normal income tax. Accordingly, MAT
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
Deferred Tax represents the tax effect of timing differences between
taxable income and accounting income for ihe reporting period and is
capable of reversal in one or more subsequent periods. Deferred tax are
quantified using the tax rates and laws enacted or substantively
enacted as on the Balance Sheet Date.
Deferred Tax Assets are recognized and carried forward 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. Deferred tax asset on unabsorbed depreciation and
carry forward of losses are not recognized unless there is virtual
certainty that sufficient future taxable income will be available
against which such deferred lax assets can be realized.
9. Contingent Liabilities and Provisions:
Provisions are recognized only when there is a present obligation as a
result of past events and when a reliable estimate of the amount of
obligation can be made.
Contingent Liability is disclosed for
a. Possible obligation which will be confirmed only by future events not
wholly within the control of the company or
b. Present obligations arising from the past events where it is not
probable that an outflow of resources will be required to settle the
obligation or a reliable estimate of the amount of the obligation
cannot be made.
c. Contingent Assets are not recognized in the financial statements
since this may result in the recognition of income that may never be
realized.
10. Earnings per Share:
In determining the Earnings Per share, the company considers the net
profit after tax including any post tax effect of any extraordinary /
exceptional item The number of shares used m computing basic earnings
per share is the weighted average number of shares outstanding during
the period.
11. Segment Reporting:
The generally accepted accounting principles used in the preparation of
the financial statements are applied to record revenue and expenditure
in individual segments
Segment levenue and segment results include transfers between business
segments. Suet transfers are accounted for at the agreed transaction
value and such transfers are eliminated in the consolidation of the
segments
Expenses that are directly identifiable to segments are considered for
determining the segment result Expenses, which relate to the company as
a whole and are not allocable to segments, are included under
unallocated corporate expenses.
Segment assets and liabilites include those directly identifiable with
the respective segments Unallocated corporate assets and liabilities
represent the assets and liabilities that relate to the company as a
whole and not allocable to any segment.
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article