[A] SIGNIFICANT ACCOUNTING POLICIES
[i] The Accounts are prepared on the historical cost basis and on the
principles of a going concern.
[ii] Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
[i] Revenue/Income and Cost/Expenditure are accounted for on accrual
[ii] Cement Sales/ Clinker Sales/ Asbestos Sheets Sales are net of
Excise Duty/Value Added Tax and exclusive of Self Consumption.
[iii] Construction Revenue/Income from/in respect of Contracts entered
on or after 01.04.2003 are accounted as per AS-7 [Revised].
Construction Revenue/Income from/in respect of Contracts entered before
01.04.2003 are accounted as per erstwhile AS-7.
[iv] Entrance Fee for Golf Membership is recognised in the year of
receipt, irrespective of the period of membership.
[v] Advances received for Time Share Weeks are reckoned as income in
equal amounts spread over the Time Share period commencing from the
year in which full payment is received.
[vi] Escalations/Claims are taken in the accounts on the basis of
receipt or as acknowledged by the client depending upon the certainty
[vii] Revenue from Real Estate Development of constructed properties is
recognised based on the Percentage of completion method. Total sale
consideration as per the legally enforceable agreements to sell entered
into is recognised as revenue based on the percentage of actual project
costs incurred to total estimated project cost, subject to such actual
cost incurred being 30 percent or more of the total estimated project
cost. Project cost includes cost of land, estimated cost of
construction and development of such properties. The estimates of the
saleable area and costs are reviewed periodically and effect of any
changes in such estimates recognised in the period such changes are
determined. Where aggregate of the payment received from customers
provide insufficient evidence of their commitment to make the complete
payment, revenue is recognised only to the extent of payment received.
Revenue from sale / sub-lease of undeveloped land is recognized when
full consideration is received against agreement to sell / sub-lease;
all significant risks and rewards are transferred to the customer and
possession is handed over.
Revenue from sale / sub-lease of developed land / plot is recognised
based on the Percentage of completion method when a firm agreement
has been entered into and 30 percent or more of the consideration is
received and where no significant uncertainty exists regarding the
amount of the consideration that will be derived from such sales and it
is not unreasonable to expect ultimate collection, and all significant
risks and rewards are transferred to the customer.
[viii] (a) The costs that are incurred before a construction contract
is secured are treated as expenses for the year in which these are
incurred and charged to revenue.
(b) The costs attributable to contracts are normally identified to
respective contracts. However, the costs which cannot be
identified/identifiable to a specified contract are charged to the
general revenue in the year in which such costs are incurred.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Differences between actual
results and estimates are recognised in the period in which the results
are known/ materialise.
Fixed Assets are stated at Cost of acquisition or construction
inclusive of freight, erection & commissioning charges, duties and
taxes, expenditure during construction period, interest on borrowing
and financial costs upto the date of acquisition/ installation. Major
Expenditure in Hotel properties involving relocation and redesigning of
various outlets, guest floors and additions thereto, enhancement in the
value of assets and revenue generating capacity is capitalised.
Depreciation on Fixed Assets is provided on Straight Line Method as per
the classification and in the manner specified in Schedule-XIV to the
Companies Act, 1956.
Long term Investments are stated at Cost and where there is permanent
diminution in the value of investments a provision is made wherever
applicable. Current Investments are carried at lower of cost or quoted/
fair value, computed categorywise. Dividend is accounted for as and
Employee Benefits are provided in the books as per AS -15 (revised) in
the following manner :
[i] Provident Fund and Pension contribution - as a percentage of
salary/wages is a Defined Contribution Scheme.
[ii] Gratuity and Leave Encashment is a Defined Benefit obligation. The
liability is provided for on the basis of actuarial valuation made at
the end of each financial year.
[i] Stock of Cement/ Asbestos Sheets is valued at estimated cost or net
realisable value, whichever is less. Value of Cement, Asbestos Sheets
and Clinker lying in the factory premises includes excise duty,
pursuant to the Accounting Standard (AS-2) [Revised].
[ii] The Closing stocks are valued on the basis of Weighted Average
Cost Method. Material at Transit is taken at cost.
[iii] Work-in-Progress/Material-in-Process are valued at estimated
[iv] Hotel Business - Stock of Food, Beverages, Operating Stores and
Supplies are valued at cost. Consumption of material is valued at Cost.
Project Under Development :
Project Under Development includes cost of Land purchased and other
costs incurred including internal development and external development
charges, construction cost, material cost, cost of services and other
Foreign Currency Transactions:
[i] Monetary Assets and Liabilities related to Foreign Currency
transactions and outstanding, except assets and liabilities hedged by a
hedge contract, at the close of the year, are expressed in Indian
Rupees at the rate of exchange prevailing on the date of Balance Sheet.
[ii] Monetary Assets and Liabilities hedged by a hedge contract are
expressed in Indian Rupees at the rate of exchange prevailing on the
date of Balance Sheet adjusted to the rates in the hedge contracts. The
exchange difference arising either on settlement or at reporting date
is recognised in the Statement of Profit & Loss except in cases where
they relate to acquisition of fixed assets, in which case they are
adjusted to the carrying cost of such assets.
[iii] Transactions in Foreign Currency are recorded in the Books of
Account in Indian Rupees at the rate of exchange prevailing on the date
[iv] The Company uses foreign currency contracts to hedge its risks
associated with foreign currency fluctuations. The Company does not use
derivative financial instrument for speculative purposes.
[i] Operating Leases: Rentals are expensed with reference to lease
[ii] Finance Leases: The lower of the fair value of the assets or
present value of the minimum lease rentals is capitalised as fixed
assets with corresponding amount shown as lease liability. The
principal component in the lease rental is adjusted against the lease
liability and the interest component is charged to Statement of Profit
& Loss .
Research and Development:
Revenue expenditure on Research and Development is charged to Statement
of Profit & Loss in the year in which it is incurred. Capital
expenditure on Research and Development is shown as an addition to
[i] Preliminary and Share Issue Expenses are written-off in the year in
which they are incurred.
[ii] Hotel Business - Miscellaneous Expenditure is stated at cost less
accumulated amortisation. Fees paid to the Franchiser is amortised over
a period of five years.
Expenditure During Construction Period:
Expenditure incurred on projects/assets during construction
/implementation is capitalised and apportioned to projects/ assets on
Earnings Per Share:
Basic earnings per equity share is computed by dividing net profit
after tax by the weighted average number of equity shares outstanding
during the year. Diluted earnings per equity share is computed by
dividing adjusted net profit after tax by the aggregate of weighted
average number of equity shares and dilutive potential equity shares
outstanding during the year.
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that takes substantial period
of time to get ready for intended use or sale. All other borrowing
costs are charged to revenue.
Revenue, operating results, assets and liabilities have been identified
to represent separate segments on the basis of their relationship to
the operating activities of the segment. Assets, Liabilities, Revenue
and Expenses which are not allocable to separate segment on a
reasonable basis, are included under Unallocated.
Taxes on Income:
Current Tax is determined as per the provisions of the Income Tax Act
in respect of Taxable Income for the year. Deferred Tax Liability is
computed as per Accounting Standard [AS-22]. Deferred Tax Asset and
Deferred Tax Liability are computed by applying tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet
Impairment of Assets:
If the carrying amount of Fixed Assets exceeds the recoverable amount
on the reporting date, the carrying amount is reduced to the
recoverable amount. The recoverable amount is measured as the higher of
the net selling price or the value in use determined by the present
value of estimated future cash flows.
Provisions, Contingent Liabilities and Contingent Assets [AS - 29]:
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes. Contingent Assets are neither recognised nor disclosed in the
financial statements. The Provisions, Contingent Liabilities and
Contingent Assets are reviewed at each Balance Sheet date.
Accounting for Oil Activity:
The Company has adopted Full Cost Method of Accounting for its Oil &
Gas Exploration Activity and all costs incurred in Acquisition,
Exploration and Development are accumulated.
Premium on Redemption of Debentures
Premium paid/ payable on Redemption of Debentures, net of tax impact,
is adjusted against the Securities Premium Reserve.