1.1 BASIS OF ACCOUNTING
The financial statements are prepared under the historical cost
convention, in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956 as
adopted consistently by the Company.
1.2 Use of Estimates
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Difference
between the actual results and estimates are recognised in the period
in which the results are known/materialized.
1.3 RECOGNITION OF INCOME & EXPENDITURE
The Company follows mercantile system of accounting and recognises
significant items of income and expenditure on accrual basis.
1.4 FIXED ASSETS
Fixed assets are stated at cost less accumulated depreciation .
Depreciation on Fixed Assets was charged to the Profit & Loss Account
in the manner prescribed in Schedule XIV read with Section 350 of the
Companies Act, 1956 on the w.d.v. of fixed assets.
1.6 IMPAIRMENT OF ASSETS
An assets is treated as impaired when the carrying cost of assets
exceeds its recoverable value. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired. The impairment loss recognised in prior accounting periods is
reversed if there has been a change in the estimate of recoverable
1.7 VALUATION OF INVESTMENTS
Long term investments are stated at cost. Provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary.
1.8 ACCOUNITNG FOR TAXES ON INCOME:
Provision for currant tax is made on the basis of the amount of tax
payable on taxable income for the year in accordance with the
Income-tax Act, 1961. Deferred tax resulting from timing differences
between book and taxable profit wherever material, is accounted for
using the tax rates and laws that have been enacted or substantially
enacted as on balance sheet date. Deferred tax assets, subject to
consideration of prudence, are recognized and carried forward only to
the extent that there is reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets
can be realized.
1.9 PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
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