OVERVIEW:

The Company is engaged in the business of construction and development of Residential & Commercial Complex and manufacture of Fertilisers.

1) SIGNIFICANT ACCOUNTING POLICIES

(A) Basis of Preparation of Financial Statements:

The financial statements have been brpared under the historical cost convention except revaluation of Single Super Phosphate Plant Buildings and Sulphuric Acid Plant Buildings, in accordance with generally accepted accounting principles (GAAP) in India on an accrual basis. GAAP comprises mandatory accounting standards as brscribed under section 133 of the Companies Act 2013 ("the Act") read with rule 7 of Companies (Accounts) Rules 2014 and the provision of the Act to the extent of notified.

(B) Use of Estimates:

The brparation of financial statement requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

(C) Fixed Assets and Debrciation:

i) Fixed Assets are stated at cost except Single Super Phosphate Plant Buildings and Sulphuric Acid Plant Buildings which were revalued on 31s'March 2000, net of Cenvat and Value added tax less accumulated debrciation including impairment loss.

ii) Software is capitalised where it is expected to provide future enduring economic benefits. Capitalisation cost includes license fees, cost of implementation/ system, integration services & incidental expenses related to its acquisition.

iii) Debrciation on tangible fixed assets is provided on Written Down Value Method (WDV) over useful life of the assets estimated by the Management. Debrciation for assets purchases/sold during period is proportionately charged. Intangible assets are amortised over their respective individual estimated useful life on a Written Down Value Method (WDV), commencing from the date the asset is available to the Company for its use. The Management estimates the useful lives for the other fixed assets as follows:

(E) Inventories:

a) Fertilser .Division:

i) Raw Materials and Stores & Spares are valued at cost.

ii) Finished stocks are valued at cost or net realisable value whichever is lower.

iii) The valuation of inventories includes taxes, duties of non refundable nature and direct expenses, and other direct cost attributable to the cost of inventory, net of excise duty, education cess and value added tax.

b) Construction Division:

Inventory comprises completed property for sale and property under construction (Construction Work-in-Progress).

i) Completed unsold inventory is valued at lower of cost and net realisable value. Cost is determined by including cost of land (at book value), materials, services and other related proportionate overheads.

ii) Work-in-progress is valued at lower of cost and net realisable value. Cost comprises cost of land (at book value), materials, services and other proportionate overheads related to projects under construction.

(F) Provision for Current tax and Deferred tax

i) Tax on Income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961 and based on expected outcome of earlier year assessments/ appeals.

ii) Deferred Tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the Balance Sheet date.

iii) Deferred tax assets are recognised and carried forward to the extent that there is virtual certainty sufficient future taxable income will be available against which such deferred tax assets can be realised.

(G) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is a brsent obligation as a result of past events and it is probable that there will be an outflow of resources. Provisions are determined based on management estimates required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current management estimate. Contingent liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial statements.

(H) Segment policies

The Company's reporting segments are identified based on activities/products, risk and reward structure, organization structure and internal reporting systems.

(I) Earnings per share (EPS)

The earnings considered in ascertaining the Company's EPS is the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the period. The weighted diluted earnings per equity share are computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.

(J) Revenue Recognition:

i) Sales of goods of Manufacturing Division are recognised on dispatches to the customers.

ii) Revenue from real estate is recognised on the transfer of all significant risks and rewards of ownership to the buyers by way of execution of documents. The Company has recognised the revenue on the basis of Percentage of Completion Method of accounting. Proportionate revenue is recognised in relation to sold area only. As per this method, revenue from sale of properties is recognised in the Statement of Profit and Loss Account in proportion to the actual cost incurred, subject to such actual costs being 25% or more of the total estimated cost.The company continues to recognise revenue in accordance with the Guidance Note on Recognition of Revenue by Real Estate Developers (Issued 2006) for the projects commenced before 1st April 2012.

The estimates of saleable area are revised periodically by the management. The effect of such changes to estimates is recognised in the period such changes are determined.

Determination of revenues under the percentage of completion method necessarily involves making estimates by the Company, some of which are of a technical nature, concerning, where relevant, the percentages of completion, costs to completion, the expected revenues from the project / activity and the foreseeable losses to completion, iii) Dividends are recognised when the right to receive the same is established. (K) Turnover

Turnover includes sale of goods, net of excise duty, service tax and value added tax.

(L) Employee Benefits:

a) Short term employee benefits:

All employee benefits falling due wholly within twelve months of rendering the service are classified as short term employee benefits. The benefits like salaries, wages, short term compensated absences etc. and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

b) Post-employment benefits:

i) Defined contribution plans: The state governed provident fund scheme, employee state insurance scheme and employee pension scheme are defined contribution plans. The contribution paid/payable under the schemes is recognised during the period in which the employee renders the related service.

ii) Defined benefit plans: The employees' gratuity liability is a defined benefit plan. The brsent value of the bligation under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method.

The obligation is measured at the brsent value of the estimated future cash flows.

(M) Cost of Construction/Development:

Cost of construction/development (including book value of land) incurred is charged to Profit & Loss Account proportionate to area sold and the balance cost is carried over under Inventory as part of Finished Goods Inventory/Work-in-Progress. Cost of construction / development includes all costs directly related to the Project Adjustments, if required, are made on completion of the respective projects.

(N) Excise Duty:

Excise duty has been accounted on the basis of payments made in respect of goods cleared. No excise duty provision has been made on closing inventory of finished goods. (O) Leased Assets:

Operating Leases: Assets acquired on lease where a significant portion of the risk and rewards of ownership are retained by the lessor are classified as operating leases. Lease Rentals are charged to the Profit and Loss account on an accrual basis.

1. Entire consumption of stores & spares is indigenous for the financial year ended 31s' March 2015 and brvious financial year.

2. Previous year's figures are regrouped and reclassified wherever necessary to make them comparables with current period's classification.

As per our report of even date

For BHARAT AGRI FERT & REALTY LIMITED.

For DESAISAKSENA & ASSOCIATES

Chartered Accountants

Y. D. Patel

Chairman & Mg. Director

DIN: 00106864

A. Y. Patel

Director DIN: 00106976 57

K. N. Jethwa

Director

DIN: 00107034

A. J. Chakote

Company Secretary

Alok K. Saksena

(Partner) Membership No. 35170

Place: Mumbai

Dated : 28th May, 2015