SIGNIFICANT ACCOUNTING POLICIES A Basis of brparation of financial Statements the financial statements have been brpared to comply with the Generally Accepted Accounting Principles in India (Indian GAAP), including the Accounting Standards notified under the relevant provision of the Companies Act, 2013. the financial statements have been brpared under the historical cost convention on an accrual basis. the accounting policies have been consistently applied by the Company. the financail Statements are brsented in Indian rupees rounded off to the nearest rupees in lacs. B Use of Estimates the brparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. the Management believes that the estimates used in brparation of the financial statements are prudent and reasonable C fixed Assets Fixed assets are stated at cost, less accumulated debrciation. Cost comprises the purchase price and all attributable cost of bringing the asset to its working condition for its intended use. Financing and other cost relating to acquisition of fixed assets are also included to the extent they relate to the period till such time as the assets are ready for commercial operation. D Debrciation and Amortisation effective 1st April, the Company debrciates its fixed assets over the useful life in the manner brscribed in Schedule II of the Companies Act 2013, as against the earlier practice of debrciating at the rates and in the manner brscribed in Schedule XIV to the Companies Act, 1956. E Investments Investments are classified into Non-Current and Current Investments. a) Non-Current Investments are carried at cost. Provision for diminution, if any, in the value of each Non-Current Investments is made to recognise a decline, other than of a temporary nature. b) Current investments are carried individually at lower of cost and fair value and the resultant decline, if any, is charged to revenue. F Inventories Inventory rebrsenting project work-in-progress is valued at cost, which includes expenditure incurred for development, other related cost and cost of land. other inventories in the nature of unsold flats and textile goods are valued at Cost. G Revenue Recognition a) Sales are net of cancellation of sale and amount payable to the developer and taxes, if any. b) The Company is engaged in the Business of textiles and development of property. Revenue from sale of properties under construction is recognised on the basis of actual bookings done (provided the significant risks and rewards have been transferred to the buyer and there is reasonable certainty of realisation of the monies). Revenue from textiles is recognised when it is earned and no significant uncertainty exists as to its realization or collection. c) All expenses incurred, including interest and selling & distribution expenses, on project is shown under Work-in-progress and amount received from Customer towards booking of the area is shown in Project Advances in respect of properties under construction. d) Interest income is recognised on time basis determined by the amount outstanding and the rate applicable. H Foreign Currency Transactions transactions in Foreign exchange are accounted at the exchange rate brvailing on the date the transaction has taken place. I Taxation tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of Profit and Loss for the year. A) Current Tax Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income-tax Act, 1961. b) Deferred Tax Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and taxable income for the year. the deferred tax charge or credit and the deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax assets are recognised only to the extent there is virtual certainty that the assets can be realised in future. J Borrowing Costs Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account. K Impairment Of Assets An asset is treated as impaired when the carrying cost of asset 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 period is reversed if there has been a change in the estimate of recoverable amount. L Provisions, Contingent Liabilities and Contingent Assets Provisions involving substantial degree of estimation in measurement are recognized when there is a brsent 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 recognized nor disclosed in the financial statements. M Government Grants Government grants and subsidies are recognized when there is reasonable assurance that the company will comply with the conditions attached to them and the grants / subsidy will be received. Government grants whose primary condition is that the company should purchase, construct or otherwise acquire capital assets are brsented by deducting them from the carrying value of the assets. The grant is recognized as income over the life of debrciable assets by way of a reduced debrciation charge while grants related to expenses are treated as other income in the income statement. N Segment Reporting The company identifies primary segments based on the dominant source, nature of risks and returns and the internal organization and management structure. The operating segments are the segments for which separate financial management in deciding how to allocate resources and in assessing performance. The accounting policies adopted for segment reporting are in line with the accounting policies of the company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. O Construction Activities a) Construction cost incurred in respect of Project under construction at Kurla is considered as W.I.P and shown as Current Assets under Inventories. b) Unsold flats at Sewri is considered as Construction Finished Goods and is shown as Current Assets under Inventories. c) The amount received (net) towards sale of Kurla is considered as Project Advances and shown under Other Long term Liabilities. P Cash & Cash Equivalents The company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents. 2 Quarterly financial results are published in accordance with the guidelines issued by SeBI. the recognition and measurement principles as laid down in the standards are followed with respect to such results. 3 At the Balance Sheet date, an assessment is done to determine whether there is any indication of impairment in the carrying amount of the fixed assets. No impairment loss is determined. 4 Membership & Subscription expenses include a sum of Rs. 11.24 Lacs (2013-2014: Nil) paid to NSCI towards entrance/membership fees. 5 the Company had entered into Development Agreement with Peninsula Land Limited (Formerly Piramal Holdings Ltd) to develop and sale properties at Mumbai and as per the said agreement, they are entitled to 22% of the gross receipt. the transactions and effect thereof are already given in these accounts. 6 Previous Year's figures are regrouped/rearranged wherever necessary. As per our report of even date For V.R.Renuka & Co. Chartered Accountants Firm Registration No. 108826W V.R. Renuka Proprietor M. No. 032263 For and on behalf of the Board of Directors Navinbhai C. Dave Chairman Paresh V. Merchant Executive Director Nikhil V. Merchant Managing Director Chetan K. Selarka Chief Financial officer Arun S. Agarwal Company Secretary Mumbai, May 29, 2015 |