The Financial statements have been prepared on accrual basis and in
accordance with applicable accounting standards. A summery of the
important accounting policies, which have been applied is set out
1.1. Basis of Accounting:
The financial statements are prepared in accordance with the historical
Long term investments are stated at cost. Incidental expenses incurred
in acquiring the Investments are added to the cost, Decline in carrying
amount of investments, if any, other than of temporary nature is
provided for in the Statement of Profit and Loss.
1.3 Fixed Assets:
Fixed Assets are recorded at cost inclusive of all incidental cost of
acquisition and other Incidental costs.
Goodwill is amortised over the period of its estimated useful life of
2.5 years. Depreciation on other fixed assets is provided on Written
Down Value Method at the rates prescribed under the Schedule XIV of the
Companies Act, 1953 on pro rata basis from the date of addition/upto
the date of deletion.
1.5 Stock on Hire
Stock on hire is reflected at total receivables comprising of total
value of hire purchase instalments falling due after end of
the accounting year net of Finance charges receivable on balance
i) In respect of Finance Charges on Hire Purchase agreements, Income is
accounted by applying implicit rate of return in the transaction on the
declining balance of the amount financed for the period of the
agreement. No Income is recognised in respect of non-performing assets
as specified in the directions issued by the Reserve Bank of India in
terms of the Non- Banking Financial (Non-Deposit Accepting or Holding)
Companies Prudential Norms (Reserve Bank) Directions, 2007. ii) Income
Interest is recognised on time accrual basis.
The provision for current tax, If any, is computed in accordance with
the relevant tax regulations. Deferred Tax is recognised on timing
difference between accounting and taxable income for the year by
applying applicable tax rates as per Accounting Standard -22 on
Accounting for Taxes on Income. Deferred Tax Assets is recognised
wherever there is reasonable certainty that future taxable income will
be available against which such Deferred Tax Assets can be realised.
1.8 Provisions and Contingent Liabilities:
Provisions are recognised In the accounts for present probable
obligations arising out of past events that require outflow of
resources, the amount of which can be reliably estimated.
Contingent liabilities are disclosed in respect of possible obligations
that arise from past events but their existence is confirmed by the
occurrence or non occurrence of one or more uncertain future events not
wholly within the control of the company, unless likelihood of an
outflow of resources is remote. Contingent assets are not recognised In
the accounts, unless there Is virtual certainty as to its realisation,