Accounting Policies of Frontier Capital Ltd. Company

Mar 31, 2024

3. Significant accounting policies

3.1 Financial instruments - initial recognition

3.1.1 Date of recognition

Financial assets and liabilities, with the exception of loans, debt securities, and borrowings are initially recognised on
the trade date, i.e., the date that the company becomes a party to the contractual provisions of the instrument. Loans
are recognised when fund transfers are initiated to the customers'' account or cheques for disbursement have been
prepared by the company (as per the terms of the agreement with the borrowers). The company recognises debt
securities and borrowings when funds reach the company.

3.1.2 Initial measurement of financial instruments

The classification of financial instruments at initial recognition depends on their contractual terms and the business
model for managing the instruments. Financial instruments are initially measured at their fair value, except in the case
of financial assets and financial liabilities recorded at amortised cost, transaction costs are added to, or subtracted
from, this amount.

3.1.3 Measurement categories of financial assets and liabilities

The company classifies all of its financial assets based on the business model for managing the assets and the
asset''s contractual terms, measured at:

• Amortised cost

3.2 Financial assets and liabilities

3.2.1 Bank balances and Loans at amortised cost

The Company measures Bank balances and Loans at amortised cost if both of the following conditions are met:

• The financial asset is held within a business model with the objective to hold financial assets in order to collect
contractual cash flows and

• The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest (SPPI) on the principal amount outstanding.

The details of these conditions are outlined below.

Business model assessment
The SPPI test

As a second step of its classification process the Company assesses the contractual terms of financial to identify
whether they meet the SPPI test.

''Principal'' for the purpose of this test is defined as the fair value of the financial asset at initial recognition and may
change over the life of the financial asset (for example, if there are repayments of principal or amortisation of the
premium/discount).

The most significant elements of interest within a lending arrangement are typically the consideration for the time
value of money and credit risk. To make the SPPI assessment, the Company applies judgement and considers relevant
factors such as the currency in which the financial asset is denominated, and the period for which the interest rate is
set.

3.2.2 Equity instruments at FVOCI

The Company subsequently measures all equity investments at fair value through profit or loss, unless the
Company''s management has elected to classify irrevocably some of its equity investments as equity instruments at
FVOCI, when such instruments meet the definition of Equity under Ind AS 32 Financial Instruments: Presentation and
are not held for trading. Such classification is determined on an instrument-by- instrument basis.

Gains and losses on these equity instruments are never recycled to profit or loss. Dividends are recognised in profit
or loss as dividend income when the right of the payment has been established, except when the company benefits
from such proceeds as a recovery of part of the cost of the instrument, in which case, such gains are recorded in OCI

(Other Comprehensive Income). Equity instruments at FVOCI are not subject to an impairment assessment.

3.2.3 Debt securities and other borrowed funds

After initial measurement, debt issued and other borrowed funds are subsequently measured at amortised cost.
Amortised cost is calculated by taking into account any discount or premium on issue funds, and costs that are an
integral part of the EIR.

3.2.4 Undrawn loan commitments

Undrawn loan commitments are commitments under which, over the duration of the commitment, the company is
required to provide a loan with pre-specified terms to the customer. Undrawn loan commitments are in the scope of
the ECL requirements.

The nominal contractual value of undrawn loan commitments, where the loan agreed to be provided is on market
terms, are not recorded in the balance sheet. The nominal values of these commitments together with the
corresponding ECLs are disclosed in notes.

3.3 Reclassification of financial assets and liabilities

The Company does not reclassify its financial assets subsequent to their initial recognition, apart from the exceptional
circumstances in which the Company acquires, disposes of, or terminates a business line. Financial liabilities are
never reclassified. The Company did not reclassify any of its financial assets or liabilities in 2021-22 and 2022-23.

3.4 Derecognition of financial assets and liabilities

3.4.1 Derecognition of financial assets other than due to substantial modification

Financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is
derecognised when the rights to receive cash flows from the financial asset have expired. The Company also
derecognises the financial asset if it has both transferred the financial asset and the transfer qualifies for
derecognition.

The Company has transferred the financial asset if, and only if, either:

• The Company has transferred its contractual rights to receive cash flows from the financial asset Or

• It retains the rights to the cash flows, but has assumed an obligation to pay the received cash flows in full without
material delay to a third party under a ''pass- through'' arrangement.

Pass-through arrangements are transactions whereby the Company retains the contractual rights to receive the cash
flows of a financial asset (the ''original asset''), but assumes a contractual obligation to pay those cash flows to one or
more entities, when all of the following three conditions are met:

• The Company has no obligation to pay amounts to the eventual recipients unless it has collected equivalent
amounts from the original asset, excluding short-term advances with the right to full recovery of the amount lent
plus accrued interest at market rates

• The company cannot sell or pledge the original asset other than as security to the eventual recipients

• The company has to remit any cash flows it collects on behalf of the eventual recipients without material delay. In
addition, the Company is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents
including interest earned, during the period between the collection date and the date of required remittance to the
eventual recipients.

A transfer only qualifies for derecognition if either:

• The Company has transferred substantially all the risks and rewards of the asset Or

• The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has
transferred control of the asset

The company considers control to be transferred if and only if, the transferee has the practical ability to sell the asset
in its entirety to an unrelated third party and is able to exercise that ability unilaterally and without imposing additional

When the Company has neither transferred nor retained substantially all the risks and rewards and has retained
control of the asset, the asset continues to be recognised only to the extent of the Company''s continuing
involvement, in which case, the Company also recognises an associated liability. The transferred asset and the
associated liability are measured on a basis that reflects the rights and obligations that the company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the
original carrying amount of the asset and the maximum amount of consideration the Company could be required to
pay.

In case where transfer of a part of financial assets qualifies for de-recognition, any difference between the proceeds
received on such sale and the carrying value of the transferred asset is recognised as gain or loss on de-recognition
of such financial asset previously carried under amortisation cost category. The resulting interest only strip initially is
recognised at FVTPL.

3.4.2 Financial Liabilities

A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where
an existing financial liability is replaced by another from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition
of the original liability and the recognition of a new liability. The difference between the carrying value of the original
financial liability and the consideration paid is recognised in profit or loss.

3.5 Impairment of financial assets

3.5.1 Overview of the ECL principles

The Company records allowance for expected credit losses for all loans, other debt financial assets not held at FVTPL,
together with loan commitments, in this section all referred to as ''financial instruments''. Equity instruments are not
subject to impairment under Ind AS 109.

The ECL allowance is based on the credit losses expected to arise over the life of the asset (the lifetime expected credit
loss or LTECL), unless there has been no significant increase in credit risk since origination, in which case, the
allowance is based on the 12 months'' expected credit loss (12mECL) as outlined in Notes.

The 12mECL is the portion of LTECLs that represent the ECLs that result from default events on a financial instrument
that are possible within the 12 months after the reporting date.

Both LTECLs and 12mECLs are calculated on either an individual basis or a collective basis, depending on the nature
of the underlying portfolio of financial instruments.

The company has established a policy to perform an assessment, at the end of each reporting period, of whether a
financial instrument''s credit risk has increased significantly since initial recognition, by considering the change in the
risk of default occurring over the remaining life of the financial instrument.

Based on the above process, the Company categorises its loans into Stage 1, Stage 2 and Stage 3, as described below:

Stage 1: When loans are first recognised, the Company recognises an allowance based on 12mECLs. Stage 1 loans
also include facilities where the credit risk has improved and the loan has been reclassified from Stage 2.

Stage 2: When a loan has shown a significant increase in credit risk since origination, the Company records an
allowance for the LTECLs. Stage 2 loans also include facilities, where the credit risk has improved and the loan has
been reclassified from Stage 3.

Stage 3: Loans considered credit-impaired. The company records an allowance for the LTECLs.

3.5.2 The Calculation of ECLs

The Company calculates ECLs to measure the expected cash shortfalls, discounted at an approximation to the EIR. A
cash shortfall is the difference between the cash flows that are due to an entity in accordance with the contract and
the cash flows that the entity expects to receive.

The key elements of the ECL are summarised below:

PD: The Probability of Default is an estimate of the likelihood of default over a given time horizon. A default may only
happen at a certain time over the assessed period, if the facility has not been previously derecognised and is still in
the portfolio.

EAD: The Exposure at Default is an estimate of the exposure at a future default date (in case of Stage 1 and Stage 2),
taking into account expected changes in the exposure after the reporting date, including repayments of principal and
interest, whether scheduled by contract or otherwise, expected drawdowns on committed facilities, and accrued
interest from missed payments. In case of Stage 3 loans EAD represents exposure when the default occurred.

LGD: The Loss Given Default is an estimate of the loss arising in the case where a default occurs at a given time. It is
based on the difference between the contractual cash flows due and those that the lender would expect to receive,
including from the realisation of any collateral. It is usually expressed as a percentage of the EAD.

Impairment losses and releases are accounted for and disclosed separately from modification losses or gains that are
accounted for as an adjustment of the financial asset''s gross carrying value.

The mechanics of the ECL method are summarised below:

Stage 1: The 12mECL is calculated as the portion of LTECLs that represent the ECLs that result from default events
on a financial instrument that are possible within the 12 months after the reporting date. The company calculates the
12mECL allowance based on the expectation of a default occurring in the 12 months following the reporting date.
These expected 12-month default probabilities are applied to a forecast EAD and multiplied by the expected LGD and
discounted by an approximation to the original EIR.

Stage 2: When a loan has shown a significant increase in credit risk since origination, the Company records an
allowance for the LTECLs PDs and LGDs are estimated over the lifetime of the instrument. The expected cash shortfalls
are discounted by an approximation to the original EIR.

Stage 3: For loans considered credit-impaired, the Company recognises the lifetime expected credit losses for these
loans. The method is similar to that for Stage 2 assets, with the PD set at 100%.

Loan commitment: When estimating LTECLs for undrawn loan commitments, the Company estimates the expected
portion of the loan commitment that will be drawn down over its expected life. The ECL is then based on the present
value of the expected shortfalls in cash flows if the loan is drawn down. The expected cash shortfalls are discounted
at an approximation to the expected EIR on the loan. For an undrawn loan commitment, ECLs are calculated and
presented under provisions.

3.5.3 Forward Looking Information

In its ECL models, the Company relies on a broad range of forward looking information as economic inputs, such as:

• GDP growth

• Unemployment rates

The inputs and models used for calculating ECLs may not always capture all characteristics of the market at the
date of the financial statements. To reflect this, qualitative adjustments or overlays are made as temporary

adjustments.

3.5.4 Write-offs

Financial assets are written off either partially or in their entirety only when the Company has no
reasonable expectation of recovery. If the amount to be written off is greater than the accumulated loss allowance,
the difference recorded as an expense in the period of write off. Any subsequent recoveries are credited to
impairment on financial instrument on statement of profit and loss.

3.6 Restructured, rescheduled and modified loans

The Company sometimes makes concessions or modifications to the original terms of loans such as changing the
instalment value or changing the tenor of the loan, as a response to the borrower''s request. The Company considers
the modification of the loan only before the loans gets credit impaired.

When the loan has been renegotiated or modified but not derecognised, the Company also reassesses whether there
has been a significant increase in credit risk. The Company also considers whether the assets should be classified as
Stage 3. Once an asset has been classified as restructured, it will remain restructured for a period of year from the
date on which it has been restructured.

3.7 Recognition of interest income
3.7.1The effective interest rate method

Under Ind AS 109 interest income is recorded using the effective interest rate (''EIR'') method for all financial
instruments measured at amortised cost. The EIR is the rate that discounts estimated future cash receipts through
the expected life of the financial instrument to the net carrying amount of the financial asset.

3.7.2 Interest Income

The EIR (and therefore, the amortised cost of the asset) is calculated by taking into account of fees and costs that are
an integral part of the EIR. The Company recognises interest income using a rate of return that represents the best
estimate of a constant rate of return over the life of the loan.

3.8 Taxes

3.8.1 Current tax

Current tax assets and liabilities for the current and prior years are measured at the amount expected to be
recovered from, or paid to, the taxation authorities. The tax rates and tax laws used to compute the amount are
those that are enacted, or substantively enacted, by the reporting date in the countries where the Company operates
and generates taxable income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying
transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns
with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions
where appropriate.

3.8.2 Deferred Tax

Deferred tax is provided on temporary differences at the reporting date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

• In respect of taxable temporary differences associated with investments in subsidiaries, where the timing of the
reversal of the temporary differences can be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits
and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will
be available against which the deductible temporary differences, and the carry forward of unused tax credits and
unused tax losses can be utilised, except:

• When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss

• In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests
in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and taxable profit will be available against which the temporary
differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be
utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent
that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset
is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted
at the reporting date. Deferred tax relating to items recognised outside profit or loss is recognised outside profit or
loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the
underlying transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation
authority.

3.9 Property, Plant and Equipment

Property plant and equipment is stated at cost excluding the costs of day-to-day servicing, less accumulated
depreciation and accumulated impairment in value. Changes in the expected useful life are accounted for by changing
the amortisation period or methodology, as appropriate, and treated as changes in accounting estimates.

Depreciation on tangible property, plant & equipment is charged on written down value method over the useful
life/remaining useful life of the asset as per Schedule II of the Companies Act 2013. Depreciation on assets
purchased / acquired during the year is charged from the date of purchase / acquisition of the asset or from the day
the asset is ready for its intended use. Similarly, depreciation on assets sold / discarded during the year is charged up
to the date when the asset is sold / discarded. Intangible Assets consisting Softwares are amortised over the period
of three years.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each
financial year end and adjusted prospectively, if appropriate.

Property plant and equipment is derecognised on disposal or when no future economic benefits are expected from
its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is recognised in other income / expense in the statement of profit
and loss in the year the asset is derecognised. The date of disposal of an item of property, plant and equipment is
the date the recipient obtains control of that item in accordance with the requirements for determining when a
performance obligation is satisfied in Ind AS 115.

3.10 Impairment of non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s
recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair
value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the
asset does not generate cash inflows that are largely independent of those from other assets or Group of assets.
When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and
is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. In
determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions
can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples,
quoted share prices for publicly traded companies or other available fair value indicators.

The company bases its impairment calculation on detailed budgets and forecast calculations, which are prepared
separately for each of the Company''s CGUs to which the individual assets are allocated. These budgets and forecast
calculations generally cover a period of five years. For longer periods, a long-term growth rate is calculated and
applied to project future cash flows after the fifth year. To estimate cash flow projections beyond periods covered
by the most recent budgets/forecasts, the Company extrapolates cash flow projections in the budget using a steady
or declining growth rate for subsequent years, unless an increasing rate can be justified. In any case, this growth
rate does not exceed the long-term average growth rate for the products, industries, or country or countries in which
the entity operates, or for the market in which the asset is used.

Impairment losses of continuing operations, are recognised in the statement of profit and loss.

For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an
indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists,
the Company estimates the asset''s or CGU''s recoverable amount. A previously recognised impairment loss is reversed
only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last
impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its
recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit or
loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.

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Mar 31, 2014

The Financial statements have been prepared on accrual basis and in accordance w''ft applicable accounting standards. A sun may of he important accounting policies, below.

1.1 Basis of Accounting:

Recognition and provisioning for Non-performing Assets as prescribed in the directions issued by the Reserve Bank of India in term sot the Non- Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

1.2 Investments:

Long term investments am stated at cost Incidental expenses incurred in acquiring fie irt/estments are added to the cost Decline in carrying amount ofrnvesenents. if any, oher than of temporary nature is provided for in the Statement of Profit and Loss.

1.3 Fixed Assets:

Fixed Assets are recorded at cost inclusive of all incidental cost of acquisition anatoiler incidental costs.

14 Depreciation /Am orSsafon:

Goodwill is amortised over the period of its estimateduseful Me of 2.5 years. Depredation mother Sxedassets isprovided on mien Dom Value Method at the rates prescribed under ire Schedule XIV of tie Companies Act, me on pro rata basis from the date of addition/upto he date of deletion.

1 .5 Capitai-WoMn Progress:

The expenditure m correction M the assets under acquisition /construction are treated as CapM Wbik-ln-Ptogres$ til the date of capitalisation thereof.

i.6 Receivables under Financing Act-/ites

The receivables under trancing actrMes includes Stock on Hire (i.e. toU receivables comprising of total value of hire purchase insialmerts falling due after end of the accounting year net of Finance charges receivable on balance instalments), Trade Receivables (hire purchase instalments due), Loans given. Bills Discounted (net of unmatured discount charges). The receivables under financing activities we further classified into non-current portion and current potion based on tenure thereof.

1.7 Revenue Recognition:

i) tn rescec; o'' F, imce Chafes on Hire Purchase agreements. Income is accounted by applying implicit rate of return in he transacted on the declining balance cftheamounttinancedformper.od of trie agreement

ii) Interest and discounting charges income are recognised on tme accrual basis.

ill) No incom e is recognised in resoeel of non-performing assets as specified in the directions issued by the Reserve Bank of India in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudent al Norms (Reserve Bank) Directions, 2007.

1.8 Taxation:

Tne provision for current tax, if any, is computed in accordance with the relevant tax regulations. Deferred Tax is recognised on timing difference bemen accounting and taxable income for the yea- by aopiying applicable tax rates as per Accounting Standard-22 on ''Accounting for Taxes on Income: Deferred Tax Assets is recognised i«wr mem is reasonable certainty that future taxable income mil be available against Mich such Deferred Tax Assets can be realised.

Provision and Contingent liabilities

Provision are recognised in the accounts for present probable obSgafons arising out of past events that require outflow dresources, the amount of can be reliably estimated,

Contingent are disclosed in respect of possible obligations hatarisefrom pastevents but their existence is confirmed by meoccurrence or non occurrence of one or more uncertain future s not wholly within the conM of the company, unless likehood an outflow of resources is remote Contigent assests are recognized in the accounts unless there is virtual certiny as to its realisation. resources accounts.

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Mar 31, 2013

The Financial statements have been prepared on accrual basis and in accordance with applicable accounting standards. A summary of the important accounting policies, which have been applied, is set out below:

1.1 Basis of Accounting: The financial statements are prepared in accordance with the historical cost convention. Further the Company follows prudential norms for Income Recognition and provisioning for Non-performing Assets as prescribed in the directions issued by the Reserve Bank of India in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

1.2 Investments: Long term investments are stated at cost. Incidental expenses incurred in acquiring the investments are added to the cost. Decline in carrying amount of investments, if any, other than of temporary nature is provided for in the Statement of Profit and Loss.

1.3 Fixed Assets: Fixed Assets are recorded at cost inclusive of all incidental cost of acquisition and other incidental costs.

1.4 Depreciation / Amortisation: Goodwill is amortised over the period of its estimated useful life of 2.5 years. Depreciation on other fixed assets is provided on Written Down Value Method at the rates prescribed under the Schedule XIV of the Companies Act, 1956 on pro rata basis from the date of addition / upto the date of deletion.

1.5 Stock on Hire: Stock on hire is reflected at total receivables comprising of total value of hire purchase instalments falling due after end of the accounting year net of Finance charges receivable on balance instalments.

1.6 Revenue Recognition:

i) In respect of Finance Charges on Hire Purchase agreements, Income is accounted by applying implicit rate of return in the transaction on the declining balance of the amount financed for the period of the agreement. ii) Interest and discounting charges income are recognised on time accrual basis.

iii) No income is recognised in respect of non-performing assets as specified in the directions issued by the Reserve Bank of India in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

1.7 Taxation:

The provision for current tax, if any, is computed in accordance with the relevant tax regulations. Deferred Tax is recognised on timing difference between accounting and taxable income for the year by applying applicable tax rates as per Accounting Standard-22 on "Accounting for Taxes on Income". Deferred Tax Assets is recognised wherever there is reasonable certainty that future taxable income will be available against which such Deferred Tax Assets can be realised.

1.8 Provisions and Contingent Liabilities:

Provisions are recognised in the accounts for present probable obligations arising out of past events that require outflow of resources, the amount of which can be reliably estimated.

Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the company, unless likelihood of an outflow of resources is remote. Contingent assets are not recognised in the accounts, unless there is virtual certainty as to its realisation.

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Mar 31, 2012

The Financial statements have been prepared on accrual basis and in accordance with applicable accounting standards. A summery of the important accounting policies, which have been applied is set out below:

1.1. Basis of Accounting:

The financial statements are prepared in accordance with the historical cost convention,

1.2 investments:

Long term investments are stated at cost. Incidental expenses incurred in acquiring the Investments are added to the cost, Decline in carrying amount of investments, if any, other than of temporary nature is provided for in the Statement of Profit and Loss.

1.3 Fixed Assets:

Fixed Assets are recorded at cost inclusive of all incidental cost of acquisition and other Incidental costs.

1.4 Depreciation/Amortisation:

Goodwill is amortised over the period of its estimated useful life of 2.5 years. Depreciation on other fixed assets is provided on Written Down Value Method at the rates prescribed under the Schedule XIV of the Companies Act, 1953 on pro rata basis from the date of addition/upto the date of deletion.

1.5 Stock on Hire

Stock on hire is reflected at total receivables comprising of total value of hire purchase instalments falling due after end of the accounting year net of Finance charges receivable on balance installments.

i) In respect of Finance Charges on Hire Purchase agreements, Income is accounted by applying implicit rate of return in the transaction on the declining balance of the amount financed for the period of the agreement. No Income is recognised in respect of non-performing assets as specified in the directions issued by the Reserve Bank of India in terms of the Non- Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. ii) Income Interest is recognised on time accrual basis.

1.7 Taxation

The provision for current tax, If any, is computed in accordance with the relevant tax regulations. Deferred Tax is recognised on timing difference between accounting and taxable income for the year by applying applicable tax rates as per Accounting Standard -22 on "Accounting for Taxes on Income". Deferred Tax Assets is recognised wherever there is reasonable certainty that future taxable income will be available against which such Deferred Tax Assets can be realised.

1.8 Provisions and Contingent Liabilities:

Provisions are recognised In the accounts for present probable obligations arising out of past events that require outflow of resources, the amount of which can be reliably estimated.

Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company, unless likelihood of an outflow of resources is remote. Contingent assets are not recognised In the accounts, unless there Is virtual certainty as to its realisation,

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Mar 31, 2010

The financial statements are prepared under the historical cost convention, on an accrual basis and in accordance with the applicable accounting standards.

1.1) Fixed Assets :-

Fixed Assets are stated at cost, less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

1.2) Depreciation :-

Depreciation on Fixed Assets is provided on Written Down Method at the rates and in the manner specified in the Schedule XIV of the Companies Act, 1956.

1.3) Investments :-

Long Term Investments are stated at cost.

1.4) Revenue Recognition:

Interest is recorded on time basis. Dividend income on investments is accounted for when the right to receive the payment is established.

1.5) Taxation :-

The provision for Current Tax is determined on the basis of taxable income for the current accounting year in accordance with the Income Tax Act, 1961.

The Deferred Tax is recognized, considering the prudence, on timing difference, that originate in one period and capable of reversal in subsequent period.

Deferred tax assets are recognized on Long Term Capital loss on the basis of reasonable certainty that such deferred tax asset can be realized against future taxable Long Term Capital Gain.

Deferred tax Liability recognized in earlier year on difference between Book depreciation and depreciation under Income Tax Act 1961 is reversed to the extent of realization.

1.6) Retirement Benefits :-

No Retirement benefit provisions made.

1.7) Segment Information :-

Since the company is dealing in only one segment, ie there is no segment reporting.

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Mar 31, 2009

1.1) Fixed Assets:-

Fixed Assets are stated at cost, less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

1.2) Depreciation :-

Depreciation on Fixed Assets is provided on Written Down Method at the rates and in the manner specified in the Schedule XIV of the Companies Act, 1956-

1.3) Investments :-

Long Term Investments are stated at cost.

1.4) Revenue Recognition :

Interest is recorded on lime basis. Dividend income on investments is accounted for when the right to receive the payment is established.

15) Taxation:-

The provision for Current Tax is determined on the basis of taxable income for the current accounting year in accordance with the Income Tax Act, 1961.

The Deferred Tax is recognized, considering the prudence, on timing difference, that originate in one period and capable of reversal in subsequent period.

Deferred tax assets are recognized on Long Term Capital loco on the basis of reasonable certainty that such deferred tax asset can be realized against future taxable Long Term Capital Gain.

Deferred lax Liability recognized in earlier year on difference between Book depreciation and depreciation under Income Tax Act 1961 is reversed to the extent of realization.

1.6) Retirement Benefits :-

No Retirement benefit provisions made.

1.7) Segment Information :-

Since the company is dealing financing, there is no segment reporting.