I. Method of accounting
the Company follows mercantile system of accounting. All items of
income and expenditure are accounted for as and when accrued.
II. Revenue Recognition
Income is recognised on accrual basis.
Depreciation is provided on Straight Line Method at the rates
prescribed in Schedule XIV of the Companies Act, 1956.
IV. Fixed Assets
Fixed Assets are stated at their cost less depreciation. Cost includes
all other expenditure incurred to bring the assets into existence for
their intended use and cost of borrowings specifically taken for the
respective assets upto the date of commissioning.
Current year tax is determined in accordance with Income Tax Act, 1961
at the Current Tax rates based on assessable income.
The Company has carried forward losses under Tax Laws. In absence of
virtual certainty of sufficient future taxable income, deferred tax
asset has not been recognized in accordance with Accounting Standard
22ND Accounting for taxes on income issued by The Institute of
Chartered Accountants of India.
VI. Impairment of Assets
At each balance sheet date, the carrying amounts of fixed assets are
reviewed by the management to determine whether there is any indication
that those assets suffered an impairment loss. If any such indication
exists, the recoverable amount of the assets is estimated in order to
determine the extent of impairment loss. Recoverable amount is the
higher of an asset''s net selling price and value in use.
VII. Provisions, contingent liabilities and contingent assets
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which reliable
estimate can be made. Provisions (excluding retirement benefits) are
not discounted to its present value and are determined based on best
estimate required to settle the obligation at the balance sheet date.
These are reviewed at each balance sheet date and adjusted to reflect
the current best estimates. Contingent liabilities are not recognized
in the financial statements. A contingent asset is neither recognized
nor disclosed in the financial statements.