Basic of Accounting
The financial statements have been prepared on the historical cost
convention based on the accrual concept and in accordance and in
accordance with applicable accounting standards referred to in
subsection 3c of section 211 of the companies Act, 1956 and normally
accepted accounting principles. The accounting is on the basis of the
going concern concept.
Fixed assets are stated at cost of acquisition or construction. They
are stated at historical cost less accumulated depreciation.
Depreciation on fixed assets is provided on Straight line basis in
accordance with provisions of the companies Act, 1956 at the rates and
in the manner specified in schedule XIV of this Act.
Current investments are carried at lower of cost or fair value. Long
term investments are carried at cost. However when there is a decline
other than temporary, the carrying amount is reduced to recognize the
Items of inventory are valued at lower of cost and net realizable
Income from traded goods is recognized on accrual basis.
Miscellaneous Expenditure is being amortized proportionately over a
period of the ten years.
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalized as part of the cost
of such assets. A qualifying assets is one that necessarily takes a
substantial period of time to get ready for its intended use. All other
borrowing costs are changed to revenue.
Related Party Transaction
Company has not entered into any such transactions.
Taxes on income
Tax expense comprises both current and deferred tax at the applicable
enacted / substantially enacted rates. Current tax represents the
amount of income tax payable / recoverable in respect of the taxable
income / loss for reporting period. Deferred taxes represents the
effect of timing difference between taxable income and accounting
income for the reporting period and are capable of reversal in one or
more subsequent periods.
Earning per share
The Implementation of Accounting Standard (as-20) Earning Per
Share Issued by the Institute of Chartered Accountants of India.
Contingent liabilities, if any are disclosed in the notes accounts.
Provision is made in the accounts for the contingencies which are
likely to materialize into liabilities after the year end, till the
approval of accounts of the Board of Directors and which have a
material effect on the position stated in the Balance Sheet.