NOTES ON FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015 1. SIGNIFICANT ACCOUNTING POLICIES A. BASIS OF brPARATION OF FINANCIAL STATEMENTS (i) The financial statements have been brpared under the historical cost convention and in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 2013. (ii) The Company follows mercantile system of accounting and recognises income and expenditure on accrual basis. B. USE OF ESTIMATES The brparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of income and expenses and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting year end. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates. C. REVENUE RECOGNITION (i) In respect of construction/ project related activity, the Company follows percentage of completion method. Percentage of completion is determined by survey of work performed / physical measurement of work actually completed at the Balance Sheet Date taking into account contractual price/ unit rates and revision thereto. (ii) Revenue in respect of claims is recognised to the extent the Company is reasonably certain of their realisation. (iii) Other operational income is recognised on rendering of related services, as per the terms of the contracts. (iv) Other items of income are accounted as and when the right to receive arises. (v) Each contract is recognised as a profit centre. Payments/ reimbursements under the same are grouped under direct and other expenses. D. FIXED ASSETS, DEbrCIATION AND AMORTISATION (i) Fixed assets are stated at their original cost. Cost includes acquisition price, attributable expenses and br-operational expenses. Fixed Assets retired from active use are valued at net realisable value. (ii) Debrciation on fixed assets is provided based on useful life of the assets as brscribed in Schedule II to the Companies Act, 2013. In case of impairment, if any, debrciation is provided on the revised carrying amount of the assets over their remaining useful life. (iii) Assets acquired on equipment finance (hire purchase) are stated at their cash values. (iv) Leasehold land, if any, is amortised over the period of lease. E. INVESTMENTS Long term investments are valued at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary. F. FOREIGN CURRENCY TRANSACTIONS (i) The reporting currency of the Company is the Indian Rupee. (ii) Transactions denominated in foreign currencies are normally recorded at the exchange rate brvailing at the time of the transaction. (iii) Monetary items denominated in foreign currencies, if any, at the end of the year are restated at year end rates. (iv) Non monetary foreign currency items are carried at cost. (v) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the statement of profit and loss. G. FINANCIAL DERIVATIVES & HEDGING TRANSACTIONS (i) The company uses derivative financial instruments such as forward exchange contracts, options, currency swaps, etc., to hedge its risks associated with foreign currency fluctuations relating to the underlying transactions. (ii) Financial derivatives and hedging contracts are accounted on the date of their settlement and realised gain/loss in respect of settled contracts is recognised in the Statement of Profit and Loss along with the underlying transactions. H. LEASES The Company's significant leasing arrangements are in respect of operating leases for brmises and quarries for varying periods and the lease can be renewed as per mutual agreement. The aggregate lease rents payable are charged as rent in the statement of profit and loss. There is no restriction or contingent rent in the lease agreements. All leases are cancelable in nature. I. INVENTORIES Construction materials are valued at cost or net realisable value whichever is lower. Cost of inventories is ascertained on FIFO basis. J. TAXES ON INCOME (i) Provision for current tax is made after taking into consideration benefits admissible under the provision of the Income Tax Act, 1961. (ii) Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is reasonable certainty that the assets will be adjusted in future. The carrying amount of deferred tax assets are reviewed at each balance sheet date. In case of unabsorbed debrciation and losses, deferred tax assets are recognised and carried forward only to the extent there is a virtual certainty that the asset will be adjusted in future. K. EMPLOYEE BENEFITS (i) All employees benefits payable wholly within twelve months of rendering the service such as salaries, wages, short term compensated absences, etc. and the expected cost of bonus, ex-gratia are recognised in the period in which the employees render the related services. (ii) Retirement benefit in the form of provident fund is a defined contribution scheme and the contributions are charged to the statement of profit and loss when the contributions to the respective funds are accrued. Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation made at the end of each financial year. Short term and long term compensated absences are provided for based on actuarial valuation at the year end. Actuarial gains/losses are immediately taken to statement of profit and loss and are not deferred. L 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 statement of profit and loss. M. ACCOUNTING FOR JOINT VENTURE CONTRACTS (i) Contracts executed in joint venture under work sharing arrangement (consortium) are accounted in accordance with the accounting policy followed by the Company as that of an independent contract to the extent work is executed. (ii) Assets, liabilities and expenditure arising out of contracts executed wholly by the Company pursuant to a joint venture contract are recognised under respective heads in the financial statements. Income from the contract is accounted net of joint venturer's share under income from operations in these financial statements. (iii) Share of turnover attributable to the Company in respect of contracts executed by the other joint venture partners pursuant to joint venture agreement, is accounted under income from operations in these financial statements. N. IMPAIRMENT OF ASSETS The carrying amount of assets is reviewed at each balance sheet date to determine if there is any indication of impairment thereof based on external / internal factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount, which rebrsents the greater of the net selling price of assets and their 'value in use'. The estimated future cash flows are discounted to their brsent value at appropriate rate arrived at after considering the brvailing interest rates and weighted average cost of capital. O. PROVISION, 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. Contingent liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial statements. 2. SEGMENT REPORTING The company's operations consists "Construction/Project Activities" and there are no other reportable segment under AS-17 issued by 'The Institute of Chartered Accountants of India". 3. DISCLOSURE PURSUANT TO CLAUSE 32 OF LISTING AGREEMENT The disclosure as per clause 32 of listing agreement, with the stock exchanges at which it is listed, are mentioned at note no. 32 4. Raw materials, stores & spares consumed are 100% indigenous. 5. FINANCIAL AND DERIVATIVE INSTRUMENTS i) ECBs with currency swaps oustanding as at 31.03.2015 is Rs. 882.97 lakhs (long term - Nil and current maturitiesRs.882.97 lakhs). ii) Unhedged ECB outstanding as at 31.03.2015 is Rs. 11266.34 lakhs (restated at the year end rates), (long term Rs. 10377.55 lakhs and current maturities Rs. 888.79 lakhs). 6. Previous year figures have been reclassified, regrouped, rearranged and recomputed to conform to this year's classification, wherever considered necessary. 7. Figures in the financial statements have been rounded off in rupees lakhs upto two decimal places. The notes are an integral part of the financial statements In terms of our report of even date attached. For Agrawal S.Kumar & Associates Chartered Accountants Firm Registration No. 322324E (Hitesh Lilha) Partner Membership No. 069536 For and on behalf of the Board (Girdhar Gopal Kandoi) Chief Financial Officer (Anjanee Kumar Lakhotia) Chairman & Managing Director DIN-00357695 (Vivek jain) Company Secretary (Ram Dayal Modi) Director DIN-0304711 Place: New Delhi Dated : 22nd May, 2015 |