a) Change in accounting policy
Presentation and disclosure of financial statements during the year
ended March 31, 2012 the revised Schedule VI notified under the
Companies Act, 1956, has become applicable to the Company for
preparation and presentation of its financial statements. The adoption
of revised Schedule VI does not impact recognition and measurement
principles followed by the Company for preparation of financial
statements. However, it significant impact on presentation and
disclosures made in the financial statements. The Company has also
reclassified the previous year figures in accordance with the
requirements applicable in the current year.
b) 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 result 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. Significant estimates used by the management in
the preparation of these financial statements include computation of
percentage completion for projects in progress, project cost, revenue
and saleable area estimates, classification of assets and liabilities
into current and non current, estimates of the economic useful lives of
fixed assets, provisions for bad and doubtful debts. Any revision to
accounting estimates in recognized prospectively.
3) Tangible and intangible fixed assets
a) Tangible fixed assets
Tangible fixed assets are stated at cost, less accumulated depreciation
and impairment losses, if any, Cost comprises the purchase price and
any attributable cost of bringing the asset to its working condition
for its intended use. Any trade discounts and rebates are deducted in
arriving at the purchase price.
Borrowing costs directly attributable to acquisition of fixed assets
which take substantial period of time to get ready for its intended use
are also included to the extent they relate to the period till such
assets are ready to be put to use.
Gains or losses arising from derecognition of fixed assets are measured
as the difference between the net disposal proceeds and the carrying
amount of the asset and are recognized in the statement of profit and
loss when the asset is derecognized.
b) Depreciation on tangible fixed assets
Depreciation on assets, other than those described below, is provided
using written down value method at the rates prescribed under Schedule
XIV of the Companies Act, 1956, which is also estimated by the
management to be the estimated useful lives of the assets.
Assets individually costing less than or equal to Rs.5,000/- are fully
depreciated in the year of purchase.
c) Impairment of tangible and intangible assets
The Company assesses at each reporting date whether there is any
indication that an asset may be impaired. If any indication exists, the
Company estimates the asset''s recoverable amount. An asset''s
recoverable amount is the higher of an assets or cash generating units
(CGU) net selling price and its value in use. The recoverable amount is
determined for an individual assets, unless the asset does not generate
cash inflows that are largely independent of those from other assets or
groups of assets. Where the carrying amount of an asset or CGU exceeds
its recoverable amount, the asset is considered impaired and is written
down to its recoverable amount. In assessing value in use, the
estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset. In determining
net selling price, recent market transactions are taken into account,
if available. If no such transactions can be identified, an appropriate
valuation model is used. Impairment losses, including impairment on
inventories, are recognized in the statement of profit and loss.
After impairment deprecation is provided on the revised carrying amount
of the asset over its remaining useful life.
On initial recognition, all investments are measured at cost. The cost
comprises purchase price and directly attributable acquisition charges
such as brokerage, fees and duties. If an investment is acquired, or
partly acquired, by the issue of shares or other securities, the
acquisition cost is the fair value of the securities issued.
Related to contractual and real estate activity
Direct expenditure relating to construction activity is inventorised.
Other expenditure (including borrowing costs) during construction
period is inventorised to the extent the expenditure is directly
attributable cost of bringing the asset to its working condition for
its intended use. Other expenditure (including borrowing costs)
incurred during the construction period which is not directly
attributable for bringing the assets to its working condition for its
intended use is charged to the statement of profit and loss. Direct and
other expenditure is determined based on specific identification to the
construction and real estate activity. Cost incurred/items purchased
specifically for projects are taken as consumed as and when
6) Revenue recognition
Recognition of revenue from real estate projects
Revenue from real estate projects is recognized when it is reasonably
certain that the ultimate collection will be made and that there is
buyers commitment to make the complete payment. The Risk & reward is
passed on to the Buyer.
In such cases, the revenue is recognized on percentage of completion
method, when the following Criteria listed below are met Together & not
a) When the stage of completion of the project reaches a reasonable of
development. A reasonable level of development is not achieved if the
expenditure incurred on construction and development costs is less than
25% of the construction and development costs.
b) At least 25% of the saleable project area is secured by contracts or
agreements with buyers.
c) At least 10% of the total revenue as per the agreements of sale or
any other legally enforceable documents are realised at the reporting
date in respect of each of the contracts and it is reasonable to expect
that the parties to such contracts will comply with the payments terms
as defined in the contracts.
Revenue is recognized in proportion that the contract costs incurred
for work performed up to the reporting date bear to the estimated total
contract costs. Land costs are not included for the purpose of
computing the percentage of completion.
Note : The Guidance note on accounting of Real estate Transaction
(Revised 2012.) issued by ICAI has Been followed for Projects Commenced
after April 2012 or Projects Commenced before April 2012 but no Revenue
from the project is recognized for the year ended 31-03-2012.
The Project Namely Pushp Vinod 2, Pushp Vinod 3, Pushp Vinod 4 are
accounted based on the Revised Guidance note on Accounting of real
estate transaction 2012. issued by the ICAI.
7) Interest Income
Income is recognized on a time proportion basis taking into account the
amount outstanding and the rate applicable.
Tax expense comprises of current and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities in accordance with the Indian Income Tax Act. Deferred
income taxes reflects the impact of current year timing differences
between taxable income and accounting income for the year and reversal
of timing differences of earlier year.
Deferred tax is measured based on the tax rates and the tax laws
enacted or substantively enacted at the balance sheet date. Deferred
tax assets are recognized 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. In situations
where the Company has unabsorbed depreciation or carry forward tax
losses, all deferred tax assets are recognized only if there is virtual
certainty supported by convincing evidence that they can be realized
against future taxable profits. At each balance sheet date the Company
re-assesses unrecognized deferred tax assets. It recognizes
unrecognized deferred tax assets to the extent that it has become
reasonably certain or virtually certain, as the case may be, that
sufficient future taxable income will be available against which such
deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each balance
sheet date. The Company writes down the carrying amount of a deferred
tax asset to the extent that it is no longer reasonably certain or
virtually certain, as the case may be, that sufficient future taxable
income will be available against which deferred tax asset can be
Minimum Alternative tax (MAT) credit is recognized as an asset only
when and to the extent there is convincing evidence that the Company
will pay normal income tax during the specified period. In the year in
which the MAT credit becomes eligible to be recognized as an asset in
accordance with the recommendations contained in Guidance Note issued
by the Institute of Chartered Accountants of India, the said asset is
created by way of a credit to the statement of profit and loss and
shown as MAT Credit Entitlement. The Company reviews the same at each
balance sheet date and writes down the carrying amount of MAT Credit
Entitlement to the extent there is no longer convincing evidence to the
effect that Company will pay normal income tax during the specified
9) Retirement and other employee benefits
Retirement benefits in the form of provident fund is a defined
contribution scheme and the contributions are charged to the statement
of profit and loss of the year when the contributions to the provident
fund are due. There are no other obligations other than the
contribution payable to the government administered provident fund.
Gratuity & other long terms benefits are not accounted as per A S 15
Retirement benefits issued by the ICAI.
10) Earnings per share
Basic earnings per share are calculated by dividing the net profit or
loss for the year attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the year is adjusted for
events of bonus issue.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the year attributable to equity shareholders and the
weighted average number of shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares.
A provision is recognized when the Company has a present obligation as
a result of past event, it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable. Provisions are not discounted to its present value . and are
determined based on the 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.
12) 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.