The Company follows the directions prescribed by the Reserve Bank of
 India for Non-Banking Financial Companies with respect to Income
 Recognition, Asset Classification, Provisioning norms. The applicable
 Accounting Standards issued by The Institute of Chartered Accountants
 of India is followed in drafting the accounts of the company.
 
 1.1 Income Recognition:
 
 a.  Income from Hire purchase and hypothecation loan transactions is
 accounted on the basis of Internal Rate of Return method.
 
 b.  In respect of receivables assigned bilaterally, the difference
 between the book value of the assets assigned and the sale
 consideration is booked as income in the year of contract.
 
 c.  Additional Finance Charges is accounted on accrual basis at 18% p.a
 whereas the contracted rate is 36%.p.a
 
 d.  Collection charges are accounted on cash basis
 
 e.  Due date Missing charges are accounted on accrual basis
 
 1.2 Repossessed Assets:
 
 Repossessed assets are valued at the settlement value and provision to
 an extent of 40 % is uniformly made on the settlement value.
 
 1.3 Fixed Assets:
 
 Fixed assets are stated at historical cost less accumulated
 depreciation.
 
 1.4 Depreciation:
 
 On Own assets (Tangible):
 
 Depreciation on assets for own use is provided on Written down value
 method at the rates prescribed in Schedule XIV to the Companies Act.
 1956. Assets costing Rs.5,000/- or less acquired during the year are
 fully depreciated.  On Own assets (Intangible):
 
 Intangible assets comprising of Computer Software are depreciated on a
 straight-line basis over a period of five years.
 
 1.5 Investments:
 
 Long term Investments and unquoted investments are carried at cost