1. BASIS OF ACCOUNTING :
The Financial Statements are prepared under the historical cost
convention and income and expenses are accounted for on an accrual
2. REVENUE & EXPENDITURE RECOGNITION :
INCOME FROM OPERATIONS:
Income from operations is determined as the aggregate during the year
of the project promotion fee earned and the value of construction work
- PROJECT PROMOTION FEE :
Project promotion fee is the fee charged to customers on allotment of
flats at a specific rate per square foot of built-up area to be
constructed, in consideration of the various services rendered by the
Company for promoting the respective projects.
- VALUE OF CONSTRUCTION WORK :
The value of construction work done during the year is determined as
i. In the case of projects completed during the year, it is the
difference between the value of construction to customers on completion
of the projects and the value of construction to customers at the
beginning of the accounting year.
ii. In the case of projects in progress at the close of the accounting
year, it is the difference between the value of construction to
customers determined at close of the accounting year and the value of
construction to customers at the beginning of the accounting year.
iii. Value of construction to customers in respect of completed
projects is the full value that is paid/payable by the customers for
the projects on this account.
iv. Value of construction to customers in respect of projects in
progress at the beginning of the accounting year and at close of the
accounting year is the value of work-in-progress on those dates
3. FIXED ASSETS AND DEPRECIATION :
i. Expenditure, which is of a capital nature, is capitalised at cost,
which comprises purchase price (net of rebates and discounts),
statutory levies and other expenses/charges directly expended in
acquiring such assets. Depreciation is provided, from the date the
assets have been installed and put to use, on written down value method
at the rates specified under Schedule XIV of the Companies Act 1956.
ii. Assets acquired under hire purchase agreement/financial lease
agreement are capitalised to the extent of their principal value, while
the financial charges incurred in the hire charges payment/ financial
charges on lease are charged to revenue in the year in which they are
payable. Depreciation on such assets is provided in accordance with
the policy of the company for owned assets.
4. RETIREMENT BENEFITS:
Contribution to Provident Fund is made monthly at a predetermined rate
to a recognised Provident Fund Trust and debited to the Profit and Loss
Account on an accrual basis. The Company has no leave encashment
5. CONTINGENT LIABILITIES :
All liabilities have been provided for in the accounts except those of
a contingent nature, which have been disclosed at their estimated value
in the notes on accounts.
Current Investments are carried at lower of cost or fair value.
Long-term Investments are stated at cost. Provision for diminution in
the value is made in accordance with AS 13 – Accounting for Investments
if the decline/ diminution is other than temporary.
7. TAXES ON INCOME:
i. Provision for current tax is made in accordance with the Income Tax
ii. In accordance with the Accounting Standard AS-22 ‘Accounting for
Taxes on Income issued by the Institute of Chartered Accountants of
India, Deferred Tax Liability / Asset arising from timing differences
between book and income tax profits is accounted for at the current
rate of tax to the extent these differences are expected to crystallize
in later years However, Deferred Tax Assets are recognized only if
there is a reasonable / virtual certainty of realization thereof.
8. PROVISIONS AND CONTINGENCIES:
Provisions involving a substantial degree of estimation in measurement
are recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent liabilities are not recognized but are disclosed in the
accounts by way of a note. Contingent assets are neither recognized nor
disclosed in the financial statements.