1. Accounting Convention
The Financial Statements are prepared under historical cost convention
on an accrual basis and in compliance with all material aspects of the
Notified Accounting Standard by Companies Accounting Standard Rules,
2006 and the relevant provisions of the Companies Act, 1956. The
accounting policies have been consistently applied by the company and
are consistent with those used in the previous year.
2. Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of the
financial statements and the results of operations during the reporting
period. Although these estimates are based upon management''s best
knowledge of current events and actions, actual results could differ
from these estimates.
3. Revenue Recognition
Dividend income on investments is accounted for when the right to
receive the payment is established. Rent Income on property is
recognized on accrual basis. Profit on sale of Investment is recognized
at the time of redemption/sale.
4. Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use.
5. Depreciation/ Amortization
Depreciation on fixed assets is provided on written down value method
at the rate specified under Schedule XIV to the Companies Act, 1956
except mobile phone, which is fully depreciated in the year of
purchase. Depreciation on assets added/ disposed during the year has
been provided with reference to the date of addition/ disposal.
6. impairment of Assets
The Carrying amount of assets is reviewed at eaph Balance Sheet date if
there is any indication of impairment based on internal/ external
factors. An asset is treated as impaired when the carrying cost of
assets exceeds its recoverable value. An impairment loss if any is
charged to Profit and loss Account in the year in which an asset is
identified as impairment. Reversal of impairment losses recognized in
prior years is recorded when there is an indication that the impairment
losses recognized for the assets no longer exists or has decreased.
Long term Investments are stated at cost after deducting provision, if
any, made for diminution, other than temporary, in the values.
Current Investments are stated at lower of cost and market/fair value.
Provision for current tax is made on the basis of Estimated Taxable
Income for the current accounting year in accordance with the Income
Tax Act, 1961.
The deferred tax for timing differences between the book and tax
profits for the year is accounted for, using the tax rates and laws
that have been substantively enacted as of the balance sheet date.
Deferred tax assets arising from timing differences are recognized to
the extent there is reasonable certainty that these would be realized
Deferred tax assets are recognized on unabsorbed losses only if there
is virtual certainty that such deferred tax assets can be realized
against future taxable profit.
9. Cash and Cash equivalents:
Cash and cash equivalents for the purposes of cash flow statement
comprise cash at bank and in hand and short-term investments with an
original maturity of three months or less.
10. Contingent Liabilities:
Contingent Liabilities as defined in AS 29 on Provision, Contingent
Liabilities and Contingent Assets are disclosed by way of notes to
accounts. Provision is made if it becomes probable that an outflow of
future economic benefits will be required for an item previously dealt
with as contingent liability. Contingent assets are neither recognized
nor disclosed in the financial statements.