Significant Accounting Policies and Notes to Financial Statements Note 1 : Significant Accounting Policies & Practices a. Company Overview One of the leading construction and Infrastructure Development Companies in India, Shristi Infrastructure Development Corporation Ltd. started commercial operation in 1999. Shristi Infrastructure Construction activities includes construction of power plants, sub-stations, transmission lines hotels, buildings etc. b. Basis of Accounting The financial statements have been brpared in accordance with the Mandatory Accounting Standards brscribed in the Companies (Accounting Standards) Rules, 2006 read with the general circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 and the relevant provisions of the Companies Act, 1956 and also the Revised Schedule VI as approved by the Act in all material respects. 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 and are consistent with those used in the brvious year. c. a) Fixed Assets Fixed Assets are stated at cost of acquisition, other attributable expenditure less accumulated debrciation. b) Development Rights Development rights for land will be amortised in future years upon completion of the respective project. d. Investments Investments are stated at cost inclusive of brokerage and stamp charges. Unquoted investments are valued at cost. Investments held/intended to be held for a period exceeding one year are classified as long-term investments. Provision for diminution in the value of Long Term Investments is made only if such a decline is other than temporary in the opinion of the Management. e. Debrciation Debrciation on fixed assets is provided under Written down Value method using useful life brscribed in Schedule II to the Companies Act, 2013. f. Impairment of Assets At each Balance Sheet date, the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognized in the accounts to the extent the carrying amount exceeds the recoverable amount. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount. g. Revenue Recognition Contract receipts are recognized under percentage completion method in respect of work contract business. Interest revenue is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. Claims are accounted for on acceptance by client or evidence of such acceptance. h. Retirement Benefits a) Gratuity liability and Compensated leave encashment to employees is accounted for on the basis of actuarial valuation using Projected Unit Credit Method. b) Company's Contributions to Provident are charged to Profit & Loss account in the year when the contributions to the respective funds are due. i. Inventories Raw Materials are valued at weighted average cost and Work-in-Progress is valued at lower of cost and estimated net realizable value. j. Borrowing Cost Borrowing Costs that are attributable to the acquisition and construction of qualifying asset are capitalized as part of the cost of the asset. Other borrowing costs are recognized as expense in the year of the expense. k. Taxation (a) Current Tax - is provided on accessible income as per Income Tax Act, 1961. In accordance with the tax Regulation as applicable to the company. (b) Deferred tax - Deferred tax charge or credit reflect the tax effect, of the timing differences between accounting income and taxable income for the period which are capable of being reversed in future. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantially enacted by the balance sheet date. Deferred tax are recognized only to the extent there is reasonable certainty that the assets can be realized in future. l. Contingent Liability Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclose as per note no 24. The company creates a provision when there is a brsent obligation as a result of past events and it is probable that there will be outflow of resources and a reliable estimate of the obligation can be made off the amount of the obligation. Contingent liabilities are not recognized but are disclosed in the notes to the financial statements. A disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a brsent obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. 2. Amount credited in Capital Reserve arising due to Haldia project being restated at their fair values pursuant to Scheme of Arrangement and its correspondingly included in Fixed Asset Schedule as Development Right. 3. Contingent Liabilities (a) Bank Guarantee : Guarantees given by bank on behalf of the company amounting to Rs. 14.00 lacs (P. Y. Rs. 139.06 lacs.) (b) Outstanding Guarantee : The Company has given guarantee for loans taken by Other Companies from Banks or financial institutions and outstanding amount as on 31st March, 2015 is - Rs. 20,256 Lacs. (P. Y. Rs. 10,249 lacs) 4. There are no Micro, Small and Medium Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days as at 31st March, 2015. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. 5. Capital expenditure - Contingent & Commitment : There is no capital expenditure of the company during the year. No contingent liabilities arise on this account. There is no commitment by the company towards capital expenditure. 6. Use of Estimates and Judgment : The company has not made any estimate or made use of any judgment while recording transactions of the company. 7. The company has reclassified the brvious year's figures in accordance with the requirement applicable in the current year. As per our report of even date For S. S. KOTHARI & CO. On behalf of the Board Chartered Accountants Firm Regn. No. 302034E R. N. BARDHAN Partner Membership No.17270 Dipak Kr. Banerjee Chairman Sunil Jha Managing Director B. K. Tulsyan Chief Financial Officer Manoj Agarwal Company Secretary Place : Kolkata Date : 29th May, 2015 |