1. Basis of Presentation:
The Company maintains its accounts on accrual basis, following the
historical cost convention in compliance with the Accounting Standards
referred to in Section 211(3C) and other requirements of the Companies
2. Fixed Assets:
a) Capitalized at acquisition cost including directly attributable
costs such as freight, insurance and specific installation charges for
bringing the assets to the working condition for use.
b) Intangible assets are stated at cost, net of tax / duty availed,
less accumulated amortization / impairment losses, if any. Cost
includes original cost of acquisition, including incidental expenses
related to such acquisition.
3. Depreciation on Fixed Assets:
(a) Depreciation is provided on Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956;
(b) Depreciation on assets acquired and sold during the year/ period,
has been charged pro-rata from / up to the month of acquisition/sale of
(c) Intangible assets such as software''s, leasehold office premises etc
are amortized over a period of Five
All Shares and Securities are valued at Cost or market value, whichever
All Investments are stated at cost and provision for diminution in
value, of permanent nature, if any, of Investments is charged to the
Profit and Loss account.
6. Revenue Recognition:
(a) Merchant Banking/Syndication/Advisory Fees are recognized on
(b) Income from Securities/Investments is recognized on accrual basis.
7. (a) Future Contracts:
Initial margin payment paid at the time of inception of the contract is
shown under the head Current Assets All the future contracts are
marked to market on daily basis. The amount of marked to market margin
received / paid into/from such accounts, are debited or credited to
marked to market margin Index/Stock Future Account and appear as
separate item as Current Asset or Current Liability as the
case may be.
At the year end, appropriate provisions are created by debit to Profit
& Loss Account for anticipated loss. Anticipated profit at the year
end is ignored.
At the time of final settlement, the difference between the contract
price and the settlement price is calculated and recognized in the
Profit & Loss Account after adjusting provision created for anticipated
loss, if any.
(b) Option Contracts:
At the inception of the contract, premium paid is debited to Index
Option Premium Account or Stock Option Premium Account, as the case may
be. On receiving the premium at the time of sale, the Index Option
Premium Account or Stock Option Premium Account is credited and shown
separately under the head Current Assets or Current
Liabilities as the case may be.
All the Open Option Contracts are marked to market on daily basis in
the similar manner as in the case of Future Contracts. If the Contracts
are Open as on the Balance Sheet date, appropriate provision is made in
the books of accounts by crediting / debiting the Profit & Loss
At the time of Balance Sheet date, if the premium prevailing in the
market for a contract of similar nature is lower than the premium so
paid, then provision is made for the difference in the Profit & Loss
If the premium received is lower than the premium prevailing in the
market for contract of similar nature, appropriate provision for loss
will be made by debiting Profit & Loss Account and crediting provision
for loss on Index/Stock Option Account appearing under the head Current
At the time of settlement or at the time of squaring-up, premium is
recognized either as expense or income as the case may be.
8. Borrowing Cost:
Borrowing Cost that are attributable to acquisition, construction or
production of qualifying assets are capitalized as part of cost of such
assets. Such expenses are shown under Capital Work in Progress to be
allocated to the relevant items of assets on such assets. Such expenses
are shown under Capital Work in Progress to be allocated to the
relevant items of assets on such assets being put to use.
A qualifying asset is an asset that takes substantial period of time to
get ready for the intended use.
Borrowing Cost other than those incurred for qualifying asset is
expensed out in the year in which it is incurred.
9. Employee Stock Option Plan:
The accounting value of stock options representing the excess of the
market price over the exercise price of the shares granted under
Employees Stock Option Scheme of the Company, is amortized as
Deferred Employees compensation on a straight-line basis over the
vesting period in accordance with the SEBI (Employees Stock Option
Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.
10. Foreign Currency Transactions:
Foreign Currency Transactions are accounted for at the rates prevailing
on the dates of the transactions. Foreign Currency Assets &
Liabilities are converted at contracted rates / year end rates as
applicable, the exchange differences on settlement are adjusted to the
Profit and Loss Account.
11. Retirement Benefits:
(a) Defined Contribution Plan:
Company''s contribution paid/payable during the year to provident fund,
are charged to Profit & Loss Account. There are no other obligations
other than the contribution payable to the respective trusts.
(b) Defined Benefit Plan:
Company''s liability towards gratuity are determined using the projected
unit credit method which considers each period of service as giving
rise to an additional unit of benefit entitlement and measures each
unit separately to build up the final obligation. Past services are
recognized on a straight line basis over the average period until the
amended benefits become vested. Actuarial gain and losses are
recognized immediately in the statement of Profit and Loss account as
income or expense. Obligation is measured at the present value of
estimated future cash flow using a discounted rate that is determined
by the reference to market yields at the Balance Sheet date on
Government bonds where the currency and terms of Government bonds are
consistent with the currency and estimated terms of the defined benefit
12. Miscellaneous Expenditure:
Preliminary Expenses, Development Expenditure, Share Issue Expenses in
connection with Public Issue of Equity Shares by the Company and Rights
Issue Expenses are written off over a period of 5 years.
13. Contingencies and Events occurring after the Balance Sheet Date:
Accounting for contingencies (gains & losses) arising out of
contractual obligations are made only on the basis of mutual
acceptances. Events occurring after the date of Balance Sheet, where
material, are considered up to the date of adoption of accounts.
The current charge for taxes is calculated in accordance with the
relevant tax regulations applicable to the Company. Deferred tax assets
and liabilities are recognized for future tax consequences attributable
to the timing difference that result between the profit offered for
Income Tax and the profit as per the financial statement. Deferred tax
assets and liabilities are measured as per the tax rates/ laws that
have been enacted or subsequently enacted by the Balance Sheet date &
are reviewed for appropriateness of their respective carrying values at
each balance sheet date.
15. Impairment of Assets:
The Company assesses at each Balance Sheet date whether there is any
indication that an asset may be impaired.
If such indication exists, the Company estimates the recoverable amount
of the asset. If such recoverable amount of the asset or the
recoverable amount of the cash generating unit to which the asset
belongs is less than its carrying amount, the carrying amount is
reduced to its recoverable amount The reduction is treated as an
impairment loss and is recognized in the Profit & Loss Account.
If at the Balance Sheet date there is an indication that if a
previously assessed impaired loss no longer exists, the reassessed
asset is reflected at the recoverable amount, subject to a maximum of
depreciated historical cost.