1.1 Basis of Preparation of Financial Statements
 
 These financial statements have been prepared on the accrual basis of
 accounting, under the historical cost convention and in accordance with
 the Companies Act, 1956 arid the applicable accounting standards issued
 by the institute of Chartered Accountants of India.
 
 1.2 Revenue Recognition
 
 Expenses are recognized on accrual basis and provisions are made for
 all known losses and expenses. Dividend income is recognized when the
 right to receive dividend is established. Interest income is recognized
 on the time proportion method.
 
 1.3 Taxation
 
 Provision for current Income Tax is made in accordance with the Income
 Tax Act, 1961.
 
 In accordance with Accounting Standard 22 Accounting for Taxes on
 Income, Issued by the Institute of Chartered Accountants of India, the
 deferred tax liability for timing differences between book and the
 profits occurs when there are actual taxable profits for the year.
 Deferred tax assets are not recognized unless there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realized.
 
 1.4 Basic Earnings per Share
 
 Basic Earnings per share is determined by dividing net income by the
 weighted average number of shares outstanding during the years.