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Howard Hotels

BSE: 526761|ISIN: INE931B01016|SECTOR: Hotels
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Mar 14
Accounting Policy Year : Mar '15
 The financial statements have been prepared in accordance with
 applicable accounting standards issued by the Institute of Chartered
 Accountants of India and the relevant requirements of the Companies
 Act, 2013. Significant accounting policies applied in preparing and
 presenting these financial Statements are set out below:
 
 a) Basis of Accounting
 
 The financial statements are prepared on a going concern basis under
 the historical cost convention on the accrual basis of accounting, in
 accordance with the Indian Generally Accepted Accounting Principles
 (GAAP) and comply with the Accounting Standards specified under Section
 133 of the Companies Act, 2013, read with Rule 7 of the Companies
 (Accounts) Rules, 2014, to the extent applicable, as adopted
 consistently by the Company.
 
 b) Use of Estimates
 
 The preparation of financial statements in conformity with GAAP
 requires management to make estimates and assumptions that affect the
 reported amounts of assets and liabilities, disclosure of contingent
 assets and liabilities as at the date of the financial statements and
 the reported amounts of revenues and expenses during the reporting
 period. Actual results could differ from these estimates.  Adjustments
 as a result of differences between actual results and estimates are
 recognized prospectively.
 
 c) Revenue Recognition
 
 i) Sale of foods, rooms and other items are accounted for on accrual
 basis.
 
 ii) Other Incomes are accrued as earned except where the receipts of
 income are uncertain.
 
 d) Fixed Assets and related depreciation
 
 Fixed Assets (including intangible assets) are stated at historical
 cost less any accumulated depreciation/ amortisation. Cost includes
 original cost of acquisition including incidental expenses related to
 such acquisition.
 
 Depreciation on fixed assets other than intangible assets is provided
 on straight-line basis over the estimated useful life of each asset as
 determined by the management. Pursuant to this policy, depreciation is
 provided at the following rates which are in line with the
 corresponding rates prescribed in Schedule II of the Companies Act,
 2013:
 
                                        Useful life of Asset
 Assets Category
                           1 April 2014 onwards     Prior to 1 April 2014
 
 Office Premises               60 years (1.67%)             1.63%
 
 Computers                     3 years (33.33%)            16.21%
 
 Software                      6 years (16.67%)            16.21%
 
 Office equipment               5 years ( 20%)              4.75%
 
 Office equipment               10 years (10%)              6.33%
 
 Plant & Machinery             15 years (6.67%)             5.28%
 
 Vehicles                      8 years (12.5%)              9.50%
 
 The appropriateness of depreciation/ amortisation is reviewed by the
 management in each financial year.
 
 Losses arising from retirement or gains or losses arising from disposal
 of fixed assets which are carried at cost are recognised in the
 Statement of Profit and Loss.
 
 e) Inventories
 
 i) Raw Material : At lower of cost and net Realisable Value.
 
 Consumable and components.  : At estimated value.
 
 Scrap and slow moving unserviceable stock : At net Realisable value.
 
 ii) Costs of inventories are ascertained on the first in first out
 basis.
 
 f) Employee Benefits
 
 i) Contribution to provident fund & other funds are accounted for on
 accrual basis.
 
 ii) The liability of the company for gratuity, a defined retirement
 benefit plan, is determined by actuarial valuation carried out by an
 independent actuary.
 
 g) Impairment
 
 Fixed Assets are tested for impairment if there is any indication of
 their possible impairment. An impairment loss is recognized where the
 carrying amount of a fixed assets (or cash generating unit) exceeds its
 recoverable amount, i.e. higher of value in use and net selling price.
 Impairment loss recognized in one period can get reversed fully or
 party in a subsequent year.
 
 h) Foreign Exchange Transactions
 
 Transactions in foreign currency are recorded at the exchange rates
 prevailing at the dates of the transactions. Gain/Loss arising out of
 fluctuations in the exchange rates are recognized in the period in
 which they arise.
 
 i) Income Tax
 
 Current Tax: Provision for Income Tax is made in accordance with the
 provision of Income Tax Act, 1961.
 
 Deferred Tax: Deferred Tax is recognized on timing difference between
 taxable and accounting income that originate in one period and are
 capable of reversal in one or more subsequent periods. The deferred tax
 asset is recognized and carried forward only to the extent there is
 reasonable certainty of its realization
 
 j) Capital Work-in-Progress
 
 Costs of assets not ready for use before the year-end and expenditure
 during the construction period that is directly or indirectly related
 to construction, including borrowing costs are include under Capital
 Work-in-Progress.
 
 
 
Source :
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