1.1. Basis of preparaton of Financial Statements
The financial statements are prepared under the historical cost
conventon, on accrual basis and in accordance with the Generally
Accepted Accountng Principles in India(Indian GAAP) and comply with the
Accountng Standards prescribed in the Companies (Accountng Standards)
Rules, 2006 and the relevant provisions of the Companies Act, 1956.
2.2. Use of estmates
The preparaton of the financial statements in conformity with the
generally accepted accountng principles requires the management to make
estmates and assumptons that afect the reported amount of assets and
liabilites as of the date of the financial statements and the reported
amount of revenues and expenses for the year and disclosure of
contngent liabilites as of the date of Balance Sheet. The estmates and
assumptons used in the accompanying financial statements are based upon
the management''s evaluaton of relevant facts and circumstances as of
the date of the financial statements. Actual amounts could difer from
2.3. Fixed Assets
Fixed Assets are carried at cost less accumulated depreciaton. Cost
includes related taxes, dutes, freight, insurance etc. atributable to
acquisiton and installaton of assets and borrowing costs incurred up to
the date of commencing operatons. Impairment loss is recognised, where
applicable, when the carrying value of fixed
assets exceeds its market value or the value in use whichever is
2.4 . Depreciaton
Depreciaton on Fixed Assets is provided on Straight Line Method as per
Schedule XIV of the Companies Act, 1956. Depreciaton on impaired assets
is provided by adjustng the depreciaton charge in the remaining periods
so as to allocate the asset''s revised carrying amount over its
remaining useful life. Intangible Assets are amortsed over a period of
All investments are valued at cost. Diminuton in the value of
investments other than temporary in nature is provided for.
Materials at site are valued at cost on Weighted Average method. During
the year, the Company changed the method of valuaton of Materials at
site from FIFO method to Weighted Average method. If the Company had
valued the materials at site in FIFO method, the closing stock as on
31st March 2014 would have been lower by Rs. 2.41 lakhs and loss for the
year would be higher by Rs. 2.41 lakhs. Work-in-Progress in respect of
contracts tll ataining a reasonable progress level and in property
development tll significant risks and rewards of ownership are
transferred is valued at cost.
2.7. Revenue Recogniton
i) Revenue in respect of constructon contracts including Property
Development actvity is recognised on percentage of completon method.
Percentage of completon is arrived at as the proporton of contract
costs incurred (including directly atributable borrowing costs) up to
the Balance Sheet date to the estmated total contract costs.
ii) Dividend from investments is accounted when received.
2.8. Contract Revenue /Sales
i) Revenue in respect of billed and unbilled contracts/property
development in progress includes recognised profits based on percentage
of completon and retenton on bills. Provision for expected losses is
made irrespectve of percentage of completon.
ii) Revenue from Property Development actvity is recognised when
significant risks and rewards of ownership in the land and/or building
are transferred to the customer.
iii) Bill raised for value of work done in respect of completed and
ongoing contracts including retenton on bill is disclosed as proceeds
iv) Sale of goods and services are recognized when the goods are
delivered or services rendered.
v) Sales are recorded net of trade discounts/ rebates exclusive of
2.9. Borrowing Costs
Borrowing costs that are atributable to the acquisiton or constructon
of assets that necessarily takes substantal period of tme to get ready
for intended use are treated as part of the cost of such assets. All
other borrowing costs are charged to revenue.
2.10. Employee benefits
a. Short Term
Short term employee benefits, including accumulated compensated
absences, are recognized as an expense as per the Company''s scheme,
based on expected obligatons on undiscounted basis.
b. Long Term
i. Long term employee benefits comprise of leave encashment which is
provided for based on the actuarial valuaton using the projected unit
ii. Provident Fund
Contributons are made to the Company''s Employees Provident Fund Trust
in accordance with the fund rules. The interest rate payable by the
trust to the benefciaries every year is being notfed by the Government.
The company has an obligaton to make good the shortall, if any, between
the return from the investments of the trust and the notfed interest
This is Defined contributon plan. Fixed contributons to the
Superannuaton Fund administered by trustees and managed by Life
Insurance Corporaton of India are charged to the profit and Loss
The Company has no further obligatons for future superannuaton benefits
other than its annual contributons and recognizes such contributons as
an expense in the year incurred.
The Company makes annual contributon to a Gratuity Fund administered by
trustees and managed by Life Insurance Corporaton of India (LIC).
Liability for future gratuity benefits is accounted based on actuarial
valuaton, as at the Balance Sheet date, determined every year by LIC
using projected unit credit method. Actuarial gains and losses,
comprising of experience adjustments and the efects of changes in
actuarial assumptons, are recognised immediately in the profit and loss
Provision for current tax is made based on the liability computed in
accordance with the relevant tax rates and tax laws. Provision for
deferred tax is made for tming diferences arising between the taxable
income and accountng income calculated at the tax rates enacted or
substantally enacted by the Balance Sheet date. Deferred tax assets are
recognized only if there is a virtual certainty that they will be
realised and are reviewed for appropriateness of their respectve
carrying values at each Balance Sheet date.
2.12. Provisions & Contngent Liabilites:
Provisions are recognized for known liabilites that can be measured
where the Company has a present obligaton as a result of past event.
Contngent Liabilites are disclosed by way of note.