Accounting Policies of Baffin Engineering Projects Ltd. Company

Apr 30, 2010

1 General:

The financial statements have been prepared as of a going concern on historical cost convention, in accordance with Generally Accepted Accounting

Principles(GAAP) comprising the mandatory accounting standards issued by Institute of Chartered Accountants

2 Fixed Assets:

Fixed assets are stated at cost of acquisition or construction. They are stated at historical cost less accumulated depreciation.

3 Depreciation:

Depreciation is provided as per written down value method at rates provided by schedule XIV of the Companies Act 1956. In case of purchase/sale of assets during the year, depreciation has been charged on pro rata basis from/ up to date of the purchase/s

4 Taxation:

Current Tax calculations are based upon the assessable profits of the company computed in accordance with the Income Tax Act,1961.The deferred tax charged or credit is recognised using current tax rates. Where there is unabsorbed depreciation or carry for

5 Revenue Recognition:

Income from traded goods is recognised on accrual basis.

6 Borrowing Cost

Borrowing cost that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of the respective assets. A qualifying assets is one that necessarily takes a substantial period of time to get re

7 Deferred Revenue Expenditure

Preliminary expenses are treated as deferred revenue expenditures and is amortised over such periods as determined by management from time to time.