NOTE NO. "01" Background Ranjit Securities Limited (The Company) is a public Limited Company Domiciled in India and Its Shares are listed On Stock Exchange. But, trading is suspended. The Company is principally Engaged in providing Loans and Advances and is registered as an NBFC under Section 45 IA of RBI Act, 1934. NOTE NO. "02" BASIS OF brPARATION The financial statements of the company have been brpared in accordance with generally accepted accounting principle in India (India GAAP). The company has brpared these financial statement to comply with all material respect with the accounting standard notified under section 133 of the companies act 2013,Read with rule 7 of Companies (Accounts) Rules,2014. The Financial Statement has been brpared under the Historical cost convention on the Accrual Basis Except in case of the Asset which has been recorded on fair value and Assets for Which Provision for Impairment is Made. The accounting policy have been consistently applied by the company and are consistent with those used in the Previous Year. NOTE NO. "03" SUMMARY OF SIGNIFICANT ACCOUNTING POLICY (A) USE OF ESTIMATES The brparation of financial statement in conformity with generally accepted accounting principles require estimate and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent 1iabilities on the date of financial statement and the reported amounts of revenues and expenses during the reporting period, actual results could differ from these estimates and difference between actual results and estimate are recognized in the periods in which the results are known/materialize. (B) CASH FLOW STATEMENT The cash flow statement is brpared using the " Indirect method set out in Accounting Standard 3" Cash Flow statement which brsents cash flow from operating, investing and financing activities of the company. Cash and cash equivalent brsented in the cash flow statement consists of cash in hand and unencumbered lightly liquid Bank Balance. (C) TANGIBLE FIXED ASSETS Fixed assets are initially recorded at cost. Cost comprises the Purchase Price and any Direct attributable cost of bringing the assets to working condition for its intended use. Following Initial Recognition. Tangible assets are carried at cost less accumulated debrciation and Impairement Loss (If any) Gain or loss arising from De recognition of Tangible assets are measured as the difference between the net disposal proceeds and the carrying amount of the assets and are recognized in the statement of profit and loss when the assets is derecognized. (D) RETIREMENT BENEFIT No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits. (E) DEbrCIATION Debrciation on Fixed assets is provided to the extent of debrciable amount as per written down value (WDV) method. Debrciation is provided based on useful life of the assets as brscribed in schedule II of the Companies Act 2013. The written down value of Fixed Assets whose lives have expired as at 1st April 2014 have been adjusted From the opening balance of Profit & Loss Account Intangible assets are amortised on written down basis on the estimated useful economic life . (F) REVENUE RECOGNITION The Company follows the accrual basis of accounting except, in the following case where the same are recorded on cash basis on ascertainment of risk and obligation. (a) Interest and other dues are recognized on accrual basis except in the case of Income of Non Performing Assets (NPA) which is recognized as &when received as per the Prudential Norms brscribed by the RBI. (b) Dividend declared by the respective company upto the close of the accounting period are accounted for as income once the right to receive is established. (G) NON-PERFORMING ASSETS AND PROVISION All loans where the installments were over due for more than six months are classified as non-performing assets in accordance with the prudential norms brscribed by the Reserve Bank of India. Provisions for non-performing assets are made as per RBI norms. (H) INVESTMENT All Investment which are held for more than one year from date of acquisition are classified as long term investment and are stated at cost. (I) BORROWING COST Borrowing cost is treated as revenue expenditure and is charged to the Profit and Loss Account for the year. There is no Specific borrowing cost regarding acquisition of capital assets. (J) TAXATION 1) The Provision for current tax has not been provided due to loss and having Non Taxable Income. 2) Deferred tax assets and liabilities are recognized on a prudent basis for future tax consequences of timing differences arising between the carrying value of assets and liabilities and their respective tax basis, and carried forward losses. It is measured using tax rates and tax laws that have been enacted or substantially enacted at the balance sheet date. The impact of changes in deferred tax assets and liabilities is recognized to the profit and loss account. (K) EARNING PER SHARE The company reports basic and diluted earning per shares are computed in accordance with Accounting Standard-20 -Earning per share. Basic EPS is calculated by dividing the Net Profit after tax for the year attributable to equity share holders by the weighted Average number of Equity Shares outstanding during the year. (L) PROVISION, CONTINGENT LIABILITIES & CONTINGENT ASSETS The Provision is recognized when the company has a brsent obligation as a result of past events and it is probable that an outflow of resources would be required to settle the obligation, in respect of which a reliable estimate can be made. A contingent liability is a possible obligation That arise from past events whose existence will be confirmed by the occurrence of one or non occurrence of one or more uncertain future event beyond the control of the company or a brsent obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability arises in extremely rear cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognized a contingent liability but discloses its event in financial statement. (M) PRIOR PERIOD ADJUSTMENT & EXTRA ORDINARY ITEM Income and expenditure pertaining to prior period which were omitted to be recorded in last year due to error or omission in books are duly reflected under head of prior period items in the statement of Profit & loss of current year. (N) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE. Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material. (0) IMPAIRMENT OF ASSETS Fixed asset are reviewed for impairment whenever events or changes in circumstances indicates that the carrying amount of assets may not be recoverable. If such assets are considered to be impaired, the impairment is recognized by debiting the Profit & Loss Account and is measured as the amount by which the carrying cost of assets exceeds the fair vale of assets. The impairment loss recognized in prior accounting periods is reversed, if there has been a change in the estimate of recoverable amount. By virtue of this Company has carried out combrhensive exercise, to assess the impairment loss of assets based on such exercise. (P) SEGMENT REPORTING Primary Segment identified based on the nature of product and secondary segment is identified based on geographical location. (Q) FINANCE LEASE Assets taken on lease, under which the lessee effectively have all the risks and rewards of ownership, are classified as finance lease .Finance lease payment are recognized as expenses with reference to lease term and other considerations. NOTES ON ACCOUNTS 1 Previous year's figures have been regrouped and re-casted, re-arranged wherever necessary to make them comparable with those of the current year. 2 Criminal proceedings under section 295 (4) & (5), 211, 372 (8) and 383 (1A) of Companies Act, 1956 were initiated by the Registrar of Companies, MP, against the company and its directors before the Chief Judicial Magistrate, Gwalior (MP). 3 The Company's shares are suspended from trading at Bombay Stock Exchange Ltd. (BSE), Ahmedabad Stock Exchange (ASE), and Madhya Pradesh Stock Exchange (MPSE).However, the company has applied for Revocation of suspension of share with BSE which is yet to be concluded. The Company has also filed delisting application with MPSE which is again pending for conclusion. 4 In the opinion of the management loans and advances other than doubtful have been considered as good and fully recoverable. However in terms of Reserve Bank of India Guidelines applicable to Non-Banking Finance Companies a provision for Sub-standard and Doubtful finance aggregating to Rs. 2771027.96 (P.Y. Rs. 1068389.00) and Rs. 2787.62 (P. Y. Rs. 77461.00) for Standard Assets has been made by charging them to Statement of Profit & Loss. Moreover the receipts from such borrowers have been appropriated in order of (a) principal amount (b) unvouched interest other charges (c) current interest 5 In terms of Non Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007, all NBFCs are required to make necessary provision for Standard Assets at 0.25 Per Cent and the company has made provision for Rs. 2787.62 for Standard Assets. 6 In the opinion of the Management, the Current Assets, Loan & Advances have a value of realization in the ordinary course of business at least equal to the amount at which they are stated in the accounts. 7 The Company has been classified as loan Company by the Reserve Bank of India and registration as Non Banking Finance Company with RBI is also continued for the year of Audit. 8 The Company has written back the NPA provision by Rs. 555529.40 (P.Y. Rs. 455002.00) due to recovery of the loan in NPA account in during the year. 9 Balance of All loan & advances are subject to confirmation and consequential reconciliation, if any from the respective parties. However, the management does not expect any material difference affecting the current year financial statement. 10 No Provision for Wealth Tax has been made by the company during the year because total taxable Wealth worked out below the exemption limit under the Wealth Tax Act. 11 The policy of provisioning against non performing loans and advances has been decided by the management considering prudential norms issued by the Reserve Bank of India for non banking financial companies except that the amount recovered subsequent to the balance sheet date have not been considered for provisioning. 12 Contingent Liabilities not provided for: a. Estimated amount of contract remaining to be executed on capital account : In respect of plot which is pending for registration. b. Commercial Tax Liabilities 31.03.2015 31.03.2014 (Pending in revision petition before Ho'able MP High Court Bench, Indore) 231104.00 231104.00 c. In respect of Criminal proceedings under section 295 (4) & (5), 211, 372 (8) and 383 (1A) of Companies Act, 1956 initiated by the Registrar of Companies, MP, before the Chief Judicial Magistrate, Gwalior (MP). 13 There are no material Prior Period item except to the extent disclosed in P&L A/C as per Accounting Standard-5 issued by ICAI. 14 For the purpose of calculating market value of investment as well as closing stock of shares, where quotations are not available on the last day of the year the latest available quotations are taken as the market value. 15 Company has made the provision of doubtful debts of Rs. 1064127.30 (for the year 2013-14 ) due from Surendra Import Export because of its non-recoverability. 16 Company has given loan to Jyoti Diya amounting to Rs.44 Lacs irrespective of the fact that Loan account has been classified as sub- standard during the current financial year. 17 Company has not made the compliance of sec 204(1) of the Companies Act 2013 upto the date of our audit. 18 The Company Secretary (KMP) has vacated office w.e.f. 06/10/2014. 19.The company did not have any long term contract including derivative contract for which there were any material foreseeable losses. 20 The Company has entered into few routine business transactions for payment of joint electricity bills and others with TDS FINCAP PVT. LTD. and TDS INFRA ESTATE DEVELOPERS PVT .LTD. are booked as per provision of section 185 and Related Party transaction under section 188 of Companies Act 2013. In terms of our report of even date attached, We certify to the Correctness of Above, For Subhash Chand Jain Anurag & Associates for and on behalf of the board Chartered Accountants FRN-04733-C (Akanksha Shrivastava) Partner M.NO. 425205 Taranjeet Singh Hora Manmohan Gambhir Mohd.Akhtar Hussain (Managing Director) (Whole Time Director) (Company Secretary) DIN: 00200864 DIN: 00199856 M.NO.:A39133 Place: Indore Date : 30th May 2015 |