Accounting Policies of GCM Commodity & Derivatives Ltd. Company

Mar 31, 2024

1. SIGNIFICANT ACCOUNTING POLICIES

1.1 Statement of compliance

The financial statements have been prepared in accordance with the provisions of the Companies Act, 2013 and the
Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as
amended from time to time) issued by Ministry of Corporate Affairs in exercise of the powers conferred by section
133 read with sub-section (1) of section 210A of the Companies Act, 2013. In addition, the guidance
notes/announcements issued by the Institute of Chartered Accountants of India (ICAI) are also applied along with
compliance with other statutory promulgations require a different treatment.

The financial statements for the year ended March 31, 2024 of the Company is the first financial statements prepared
in compliance with Ind AS. The date of transition to Ind AS is April 1, 2017. The financial statements upto the year
ended March 31, 2018, were prepared in accordance with the accounting standards notified under the Companies
(Accounting Standards) Rules, 2006 ("Previous GAAP") and other relevant provisions of the Act. The figures for the
year ended March 31, 2018 have now been restated under Ind AS to provide comparability. Refer Note 43 for the
details of first-time adoption exemptions availed by the Company.

1.2 Basis of preparation:

The financial statements have been prepared on the historical cost basis except for certain financial instruments that
are measured at fair values at the end of each reporting period.

Fair value measurements under Ind AS are categorized into Level 1, 2, or 3 based on the degree to which the inputs to
the fair value measurements are observable and the significance of the inputs to the fair value measurement in its
entirety, which are described as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
Company can access at reporting date

• Level 2 inputs are inputs, other than quoted prices included within level 1, that are observable for the asset or
liability, either directly or indirectly; and

• Level 3 inputs are unobservable inputs for the valuation of assets or liabilities

1.3 Use of Estimates and Judgments:

The preparation of the financial statements in conformity with Ind AS required management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Difference between the actual results and estimates are recognized in the year in
which results are known/materialized. Although these estimates are based upon management''s best knowledge of
current events and actions, actual results could differ from these estimates. Any revision to accounting estimates is
recognized prospectively in the current and future periods.

1.4 Presentation of financial statements:

These financial statements of the Company are prepared and presented in accordance with Indian Accounting
Standards ("Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended and
other relevant provision of the Act as amended from time to time and presentation requirements of Division II of
Schedule III to the Companies Act, 2013, (Ind AS compliant Schedule III), as applicable to the financial statements.

Amounts in the financial statements are presented in Indian Rupees rounded off to zero decimal places as permitted
by Schedule III to the Companies Act, 2013. Per share data are presented in Indian Rupee to two decimal places.

1.5 Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured and there exists reasonable certainty of its recovery. Revenue is measured at the
fair value of the consideration received or receivable as reduced for estimated customer credits and other similar
allowances.

Income from arbitrage comprises profit / loss on sale of securities held as stock-in-trade and profit / loss on equity
derivative instruments is accounted as per following:

i. Interest income is recognised in the Statement of Profit and Loss and for all financial instruments except for
those classified as held for trading or those measured or designated as at fair value through profit or loss
(FVTPL) is measured using the effective interest method (EIR).

The calculation of the EIR includes all fees and points paid or received between parties to the contract that are
incremental and directly attributable to the specific lending arrangement, transaction costs, and all other
premiums or discounts. For financial assets at FVTPL transaction costs are recognised in profit or loss at initial
recognition.

The interest income is calculated by applying the EIR to the gross carrying amount of non-credit impaired
financial assets (i.e. at the amortised cost of the financial asset before adjusting for any expected credit loss
allowance). For credit-impaired financial assets the interest income is calculated by applying the EIR to the
amortised cost of the credit-impaired financial assets (i.e. the gross carrying amount less the allowance for
expected credit losses (ECLs)). For financial assets originated or purchased credit-impaired (POCI) the EIR
reflects the ECLs in determining the future cash flows expected to be received from the financial asset.

ii. Dividend income is recognised when the Company''s right to receive dividend is established by the reporting
date and no significant uncertainty as to collectability exists.

iii. Fee and commission income and expense include fees other than those that are an integral part of EIR. The fees
included in the Company statement of profit and loss include among other things fees charged for servicing a
loan, non-utilisation fees relating to loan commitments when it is unlikely that these will result in a specific
lending arrangement and loan advisory fees.

iv. Profit / loss on sale of securities are determined based on the FIFO cost of the securities sold.

v. Profit / loss on FNO Segment and Commodity transactions is accounted for as explained below:

Initial and additional margin paid over and above initial margin for entering into contracts for Equity Index /
Stock Futures / Commodity Spot Trading/ Currency Futures and or Equity Index / Stock Options / Currency
Options, which are released on final settlement / squaring-up of underlying contracts, are disclosed under
"Other current assets". Mark-to-market margin-Equity Index / Stock Futures / Currency Futures representing the
amounts paid in respect of mark to market margin is disclosed under "Other current assets".

"Equity Index / Stock Option / Currency Option Premium Account" represents premium paid or received for
buying or selling the Options, respectively.

On final settlement or squaring up of contracts for Equity Index / Stock Futures / Currency Future, the realized
profit or loss after adjusting the unrealized loss already accounted, if any, is recognized in the Statement of
Profit and Loss. On settlement or squaring up of Equity Index / Stock Options / Currency Option, before expiry,
the premium prevailing in "Equity Index / Stock Option / Currency Option Premium Account" on that date is
recognized in the Statement of Profit and Loss.

As at the Balance Sheet date, the Mark to Market / Unrealized Profit / (Loss) on all outstanding arbitrage
portfolio comprising of Securities and Equity / Currency Derivatives positions is determined on scrip basis with
net unrealized losses on scrip basis being recognized in the Statement of Profit and Loss and the net unrealized
gains on scrip basis are ignored.

vi. Other operational revenue represents income earned from the activities incidental to the business and is
recognised when the right to receive the income is established as per the terms of the contract.

1.6 Fair value measurement:

The Company measures certain financial instruments at fair value at each reporting date. Certain accounting policies
and disclosures require the measurement of fair values, for both financial and nonfinancial asset and liabilities.

Fair value is the price that would be received to sell an asset or paid to settle a liability in an ordinary transaction
between market participants at the measurement date. The fair value of an asset or a liability is measured using the
assumption that market participants would use when pricing an asset or liability acting in their best economic

interest. The Company uses valuation techniques, which are appropriate in circumstances and for which sufficient
data is available considering the expected loss/ profit in case of financial assets or liabilities.

1.7 Intangible assets:

Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the
asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible assets are stated at
original cost net of tax/duty credits availed, if any, less accumulated amortization and cumulative impairment. Direct
expenses and administrative and other general overhead expenses that are specifically attributable to acquisition of
intangible assets are allocated and capitalized as a part of the cost of the intangible assets.

Intangible assets not ready for the intended use on the date of Balance Sheet are disclosed as "Intangible assets
under development".

Intangible assets are amortised on the written down value method over the estimated useful life. The method of
amortization and useful life are reviewed at the end of each accounting year with the effect of any changes in the
estimate being accounted for on a prospective basis.

An intangible asset is de-recognised on disposal, or when no future economic benefits are expected from use or
disposal. Gains or losses arising from de-recognition of an intangible asset are recognised in profit or loss when the
asset is derecognized.

1.8 Property, Plant and Equipments

Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at historical
cost less depreciation less impairment loss, if any. Historical cost comprises of purchase price, including non¬
refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the
item to its working condition for its intended use.

Subsequent costs are included in the asset''s carrying amount or recognized as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Company and the cost of
the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is
derecognized when replaced. All other repairs and maintenance are charged to statement of profit or loss during the
reporting period in which they are incurred.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted
for as separated items (major components) of property, plant and equipment.

Depreciation methods, estimated useful lives and residual value:

Depreciation is provided on a written down value method over the estimated useful lives of the assets which in
certain cases may be different than the rate prescribed in Schedule II to the Companies Act, 2013, in order to reflect
the actual usages of the assets.

The asset''s residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period. The asset''s residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period.

The assets'' residual values, useful lives and method of depreciation are reviewed, and adjusted if appropriate, at the
end of each reporting period.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is
greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are recognized as
income or expense in the statement of profit and loss.

1.9 Impairment of tangible and intangible assets other than goodwill

As at the end of each accounting year, the Company reviews the carrying amounts of its PPE and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If such indication
exists, the PPE, investment property and intangible assets are tested for impairment so as to determine the
impairment loss, if any. Goodwill and the intangible assets with indefinite life are tested for impairment each year.

Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount. Recoverable
amount is determined in the case of an individual asset, at the higher of the net selling price and the value in use.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pretax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.

If recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount, such
deficit is recognised immediately in the Statement of Profit and Loss as impairment loss and the carrying amount of
the asset (or cash generating unit) is reduced to its recoverable amount. For this purpose, the impairment loss
recognised in respect of a cash generating unit is allocated first to reduce the carrying amount of any goodwill
allocated to such cash generating unit and then to reduce the carrying amount of the other assets of the cash
generating unit on a pro-rata basis.

When an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit), except
for allocated goodwill, is increased to the revised estimate of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying amount that would have been determined had no impairment loss is
recognised for the asset (or cash generating unit) in prior years. A reversal of an impairment loss (other than
impairment loss allocated to goodwill) is recognised immediately in the Statement of Profit and Loss.

1.10 Employee benefits:

i. Short term employee benefits:

Employee benefits falling due wholly within twelve months of rendering the service are classified as short term
employee benefits and are expensed in the period in which the employee renders the related service. Liabilities
recognised in respect of short-term employee benefits are measured at the undiscounted amount of the
benefits expected to be paid in exchange for the related service.

ii. Post-employment benefits:

a) Defined contribution plans: The Company''s superannuation scheme, 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.

b) Defined benefit plans: The employees'' gratuity fund schemes and employee provident fund schemes
managed by board of trustees established by the Company, the post-retirement medical care plan and
the Parent Company pension plan represent defined benefit plans. The present value of the obligation
under defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit
Method.

The obligation is measured at the present value of the estimated future cash flows using a discount rate
based on the market yield on government securities of a maturity period equivalent to the weighted
average maturity profile of the defined benefit obligations at the Balance Sheet date.

Re-measurement, comprising actuarial gains and losses, the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability or asset) and any change in the effect of asset
ceiling (if applicable) is recognised in other comprehensive income and is reflected in retained earnings
and the same is not eligible to be reclassified to profit or loss.

Defined benefit costs comprising current service cost, past service cost and gains or losses on
settlements are recognised in the Statement of Profit and Loss as employee benefit expenses. Interest
cost implicit in defined benefit employee cost is recognised in the Statement of Profit and Loss under
finance cost. Gains or losses on settlement of any defined benefit plan are recognised when the
settlement occurs. Past service cost is recognised as expense at the earlier of the plan amendment or
curtailment and when the Company recognizes related restructuring costs or termination benefits.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the
defined benefit plans to recognise the obligation on a net basis.

iii. Long term employee benefits:

The obligation recognised in respect of long term benefits such as long term compensated absences is
measured at present value of estimated future cash flows expected to be made by the Company and is
recognised in a similar manner as in the case of defined benefit plans vide (ii) (b) above.

iv. Termination benefits:

Termination benefits such as compensation under employee separation schemes are recognised as
expense when the Company''s offer of the termination benefit is accepted or when the Company
recognises the related restructuring costs whichever is earlier.

1.11 Financial instruments:

Financial assets and financial liabilities are recognised in the Company''s balance sheet when the Company becomes a
party to the contractual provisions of the instrument.

Recognised financial assets and financial liabilities are initially measured at fair value. Transaction costs that are
directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities at FVTPL) are added to or deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial
assets or financial liabilities at FVTPL are recognised immediately in profit or loss.

A financial asset and a financial liability is offset and presented on net basis in the balance sheet when there is a
current legally enforceable right to set-off the recognised amounts and it is intended to either settle on net basis or to
realise the asset and settle the liability simultaneously.

1.12 Write off:

Loans and debt securities are written off when the Company has no reasonable expectations of recovering the
financial asset (either in its entirety or a portion of it). This is the case when the Company determines that the
borrower does not have assets or sources of income that could generate sufficient cash flows to repay the amounts
subject to the write-off. A write-off constitutes a de-recognition event. The Company may apply enforcement
activities to financial assets written off. Recoveries resulting from the Company''s enforcement activities will result in
impairment gains.

1.13 Impairment:

The Company recognises loss allowances for ECLs on the following financial instruments that are not measured at
FVTPL:

o Loans and advances to customers;
o Debt investment in securities;
o Equity investment in securities;
o Trade and other receivable;
o Lease receivables;

o Irrevocable loan commitments issued; and
o Financial guarantee contracts issued.

Credit-impaired financial assets

A financial asset is ''credit-impaired'' when one or more events that have a detrimental impact on the estimated future
cash flows of the financial asset have occurred. Credit-impaired financial assets are referred to as Stage 3 assets.
Evidence of credit impairment includes observable data about the following events:

o significant financial difficulty of the borrower or issuer;
o a breach of contract such as a default or past due event;

o the lender of the borrower, for economic or contractual reasons relating to the borrower''s financial difficulty,
having granted to the borrower a concession that the lender would not otherwise consider;

o the disappearance of an active market for a security because of financial difficulties; or
o the purchase of a financial asset at a deep discount that reflects the incurred credit losses.

It may not be possible to identify a single discrete event—instead; the combined effect of several events may have
caused financial assets to become credit-impaired. The Company assesses whether debt instruments that are
financial assets measured at amortised cost or FVTOCI are credit-impaired at each reporting date. To assess if
corporate debt instruments are credit impaired, the Company considers factors such as bond yields, credit ratings
and the ability of the borrower to raise funding.

A loan is considered credit-impaired when a concession is granted to the borrower due to a deterioration in the
borrower''s financial condition, unless there is evidence that as a result of granting the concession the risk of not
receiving the contractual cash flows has reduced significantly and there are no other indicators of impairment. For
financial assets where concessions are contemplated but not granted the asset is deemed credit impaired when there
is observable evidence of credit-impairment including meeting the definition of default. The definition of default (see
below) includes unlikeliness to pay indicators and a back-stop if amounts are overdue for 90 days or more.

1.14 Cash and bank balances:

Cash and bank balances also include fixed deposits, margin money deposits, earmarked balances with banks and
other bank balances which have restrictions on repatriation. Short term and liquid investments being subject to more
than insignificant risk of change in value, are not included as part of cash and cash equivalents.

1.15 Securities premium account:

i. Securities premium includes:

• The difference between the face value of the equity shares and the consideration received in respect of
shares issued pursuant to Stock Option Scheme.

• The fair value of the stock options which are treated as expense, if any, in respect of shares allotted pursuant
to Stock Options Scheme.

ii. The issue expenses of securities which qualify as equity instruments are written off against securities premium
account.

1.16 Borrowing costs:

Borrowing costs include interest expense calculated using the effective interest method, finance charges in respect of
assets acquired on finance lease and exchange differences arising from foreign currency borrowings, to the extent
they are regarded as an adjustment to interest costs.

Borrowing costs net of any investment income from the temporary investment of related borrowings, that are
attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of cost of such
asset till such time the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use or sale. All other borrowing costs are recognised
in profit or loss in the period in which they are incurred.

1.17 Accounting and reporting of information for Operating Segments:

Operating segments are those components of the business whose operating results are regularly reviewed by the
chief operating decision making body in the Company to make decisions for performance assessment and resource
allocation. The reporting of segment information is the same as provided to the management for the purpose of the
performance assessment and resource allocation to the segments. Segment accounting policies are in line with the
accounting policies of the Company.

1.18 Foreign currencies:

i. The functional currency and presentation currency of the Company is Indian Rupee. Functional currency of the
Company and foreign operations has been determined based on the primary economic environment in which
the Company and its foreign operations operate considering the currency in which funds are generated, spent
and retained.

ii. In currencies other than the Company''s functional currency are recorded on initial recognition using the
exchange rate at the transaction date. At each Balance Sheet date, foreign currency monetary items are
reported at the prevailing closing spot rate. Non-monetary items that are measured in terms of historical cost in
foreign currency are not retranslated.

Exchange differences that arise on settlement of monetary items or on reporting of monetary items at each
Balance Sheet date at the closing spot rate are recognised in the Statement of Profit and Loss in the period in
which they arise.

iii. Financial statements of foreign operations whose functional currency is different than Indian Rupees are
translated into Indian Rupees as follows -

A. assets and liabilities for each Balance Sheet presented are translated at the closing rate at the date of
that Balance Sheet;

B. income and expenses for each income statement are translated at average exchange rates; and

C. all resulting exchange differences are recognised in other comprehensive income and accumulated in
equity as foreign currency translation reserve for subsequent reclassification to profit or loss on disposal
of such foreign operations.

1.19 Taxation:

Current Tax:

Tax on income for the current period is determined on the basis of taxable income (or on the basis of book profits
wherever minimum alternate tax is applicable) and tax credits computed in accordance with the provisions of the
Income Tax Act, 1961 and based on the expected outcome of assessments/appeals.

Deferred Tax:

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the
Company''s financial statements and the corresponding tax bases used in computation of taxable profit and
quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.

Deferred tax assets are generally recognised for all taxable temporary differences to the extent that is probable that
taxable profit will be available against which those deductible temporary differences can be utilized. The carrying
amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no
longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax assets relating to unabsorbed depreciation/business losses/losses under the head "capital gains" are
recognised and carried forward to the extent of available taxable temporary differences or where there is convincing
other evidence that sufficient future taxable income will be available against which such deferred tax assets can be
realized. Deferred tax assets in respect of unutilized tax credits which mainly relate to minimum alternate tax are
recognised to the extent it is probable of such unutilized tax credits will get realized.

The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the Company expects, at the end of reporting period, to recover or settle the carrying amount of its
assets and liabilities.

Transaction or event which is recognised outside profit or loss, either in other comprehensive income or in equity, is
recorded along with the tax as applicable.

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Mar 31, 2015

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

These statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent ) and other counting principles generally accepted in India, to the extent applicable.

All assets and liabilities have been as current or non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between of assets for processing and their realisation in cash and cash , the Company has ascertained its operating cycle as 12 months for the purpose of current/non-current of assets and liabilities.

USE OF ESTIMATES

The preparation of the statements in conformity with the generally accepted principles the management to make estimates and assumptions that effect the reported amount of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the statements. Actual results may differ from that estimates and assumptions used in preparing the accompanying statements. Any differences of actual results to such estimates are recognized in the period in which the results are known / materialized.

CASH FLOW STATEMENT

Cash statement has been prepared in accordance with the "indirect method" as explained in the AS-3 issued by the Institute of Chartered Accountants of India.

FIXED ASSETS & DEPRECIATION ON TANGIBLE ASSETS

Tangible assets are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. expenditures related to an item of tangible asset are added to its book value only if they increase the future from the existing asset beyond its previously assessed standard of performance.

Items of assets that have been retired from active use and are held for disposal are stated at the lower of their book value and net realisable value and are shown separately in the statements under Other Current Assets. Losses arising from the retirement of, and gains or losses arising from disposal of assets which are carried at cost are recognised in the and loss account.

Depreciation is provided on a pro-rata basis using Straight Line Method using the estimated life as prescribed under Schedule II to the Companies Act, 2013 with the exception of the following:

(ii) assets costing ' 5,000 or less are fully depreciated in the year of purchase.

INTANGIBLE ASSETS & AMORTISATION

Intangibles assets are stated at cost less accumulated amortisation. These are being amortised over the estimated useful life, as determined by the management. Leasehold land is amortised over the primary period of the lease.

REVENUE RECOGNITION

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized.

b) Income is recognized on accrual basis from brokerage earned on secondary market operations on trade date.

c) Income from arbitrage comprises profit / loss on sale of securities held as stock-in-trade and profit / loss on equity derivative instruments is accounted as per following:

i. Profit / loss on sale of securities is determined based on the FIFO cost of the securities sold.

ii. Profit / loss on Commodity transactions is accounted for as explained below:

Initial and additional margin paid over and above initial margin for entering into contracts for Equity Index / Stock Futures / Commodity Spot Trading/ Currency Futures and or Equity Index / Stock Options / Currency Options, which are released on final settlement / squaring-up of underlying contracts are disclosed under "Other current assets". Mark-to-market margin-Equity Index / Stock Futures / Currency Futures representing the amounts paid in respect of mark to market margin is disclosed under "Other current assets".

"Equity Index / Stock Option / Currency Option Premium Account" represents premium paid or received for buying or selling the Options, respectively.

On final settlement or squaring up of contracts for Equity Index / Stock Futures / Currency Future, the realized profit or loss after adjusting the unrealized loss already accounted, if any, is recognized in the Statement of Profit and Loss. On settlement or squaring up of Equity Index / Stock Options / Currency Option, before expiry, the premium prevailing in "Equity Index / Stock Option / Currency Option Premium Account" on that date is recognized in the Statement of Profit and Loss.

As at the Balance Sheet date, the Mark to Market / Unrealised Profit / (Loss) on all outstanding arbitrage portfolio comprising of Securities and Equity / Currency Derivatives positions is determined on scrip basis with net unrealized losses on scrip basis being recognized in the Statement of Profit and Loss and the net unrealized gains on scrip basis are ignored.

OTHER INCOME RECOGNITION

Interest on investments is booked on a time proportion basis taking into account the amounts invested and the rate of interest.

Dividend income on investments is accounted for when the right to receive the payment is established.

PURCHASES

Purchase is recognized on passing of ownership in share based on broker's purchase note.

EXPENDITURE

Expenses are accounted for on accrual basis and provision is made for all known losses and liabilities.

INVESTMENTS

Current investments are stated at the lower of cost and fair value. Long-term investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long-term investments. Investments are classified into current and long-term investments.

Investments that are readily realisable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All other investments are classified as non-current investments.

CASH & CASH EQUIVALENTS

The Company considers all highly liquid financial instruments, which are readily convertible into cash and have original maturities of three months or less from the date of purchase, to be cash equivalents.

IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there is a change in the estimated recoverable value.

TAXES ON INCOME

Provision for current Income Tax is made on the taxable income using the applicable tax rates and tax laws. Deferred tax assets or liabilities arising on account of timing differences between book and tax profits, which are capable of reversal in one or more subsequent years is recognized using tax rate and tax laws that have been enacted or subsequently enacted. Deferred tax asset in respect of unabsorbed depreciation and carry forward losses are not recognized unless there is sufficient assurance that there will be sufficient future taxable income available to realize such losses.

EARNINGS PER SHARE

Basic earning per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

STOCK IN TRADE

Shares are valued at cost or market value, whichever is lower. The comparison of Cost and Market value is done separately for each category of Shares.

Units of Mutual Funds are valued at cost or market value whichever is lower. Net asset value of units declared by mutual funds is considered as market value for non-exchange traded Mutual Funds.

CONTINGENT LIABILITIES & PROVISIONS

A provision is recognised when there is a present obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and in respect of which reliable estimate can be made. Provision is not discounted to its present value and is determined based on the best estimate required to settle the obligation at the yearend date.

These are reviewed at each year end date and adjusted to reflect the best current estimate.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

OTHER NOTES & ADDITIONAL INFORMATION FORMING PART OF FINANCIAL STATEMENTS

In the opinion of the management, current assets, loans and advances and other receivables have realizable value of at least the amounts at which they are stated in the accounts.

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Mar 31, 2014

Basis of Preparation of Financial Statements

The accounts have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards notified under Section 211(3c) of the Companies Act, 1956 and the relevant provisions thereof.

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in Revised Schedule VI to the Companies Act, 1956.

Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities.

Use of Estimates

The preparation of the financial statements in conformity with the generally accepted principles requires the management to make estimates and assumptions that effect the reported amount of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from that estimates and assumptions used in preparing the accompanying financial statements. Any differences of actual results to such estimates are recognized in the period in which the results are known / materialized.

Fixed Assets & Depreciation

Fixed Assets are stated at cost less accumulated depreciation thereon. Subsequent expenditures related to an item of fixed asset are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance.

Items of fixed assets that have been retired from active use and are held for disposal are stated at the lower of their book value and net realisable value and are shown separately in the financial statements under Other Current Assets. Losses arising from the retirement of, and gains or losses arising from disposal of fixed assets which are carried at cost are recognised in the profit and loss account.

The cost of fixed assets comprises purchase price and any attributable cost of bringing the assets to its working condition for its intended use. The Company provides pro-rata depreciation from the date on which assets is acquired / put to use. Depreciation is provided on the Writtrn Down value method over the estimated useful lives of the assets or the rates prescribed under Schedule XIV of the Companies Act, 1956, whichever is higher. In respect of assets sold, prorata depreciation is provided upto the date on which assets is sold. On all assets depreciation has been provided using the Written Down Value method at the rates specified in Schedule XIV to the Companies Act, 1956.

Intangible Assets & Amortisation

Intangibles assets are stated at cost less accumulated amortisation. These are being amortised over the estimated useful life, as determined by the management. Leasehold land is amortised over the primary period of the lease.

Revenue Recognition

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized.

a) Income is recognized on accrual basis from brokerage earned on secondary market operations on trade date.

b) Income from arbitrage comprises profit / loss on sale of securities held as stock- in-trade and profit / loss on equity derivative instruments is accounted as per following;

i) Profit / loss on sale of securities is determined based on the FIFO cost of the securities sold.

ii) Profit / loss on arbitrage transactions is accounted for as explained below:

Initial and additional margin paid over and above initial margin for entering into contracts for Equity Index / Stock Futures / Currency Futures and or Equity Index / Stock Options / Currency Options, which are released on final settlement / squaring-up of underlying contracts are disclosed under "Other current assets". Mark-to-market margin-Equity Index / Stock Futures / Currency Futures representing the amounts paid in respect of mark to market margin is disclosed under "Other current assets".

"Equity Index / Stock Option / Currency Option Premium Account"" represents premium paid or received for buying or selling the Options, respectively.

On final settlement or squaring up of contracts for Equity Index / Stock Futures / Currency Future, the realized profit or loss after adjusting the unrealized loss already accounted, if any, is recognized in the Statement of Profit and Loss. On settlement or squaring up of Equity Index / Stock Options / Currency Option, before expiry, the premium prevailing in ""Equity Index / Stock Option / Currency Option Premium Account"" on that date is recognized in the Statement of Profit and Loss.

As at the Balance Sheet date, the Mark to Market / Unrealised Profit / (Loss) on all outstanding arbitrage portfolio comprising of Securities and Equity / Currency Derivatives positions is determined on scrip basis with net unrealized losses on scrip basis being recognized in the Statement of Profit and Loss and the net unrealized gains on scrip basis are ignored.

Other Income Recognition

Interest on investments is booked on a time proportion basis taking into account the amounts invested and the rate of interest.

Dividend income on investments is accounted for when the right to receive the payment is established.

Purchase

Purchase is recognized on passing of ownership in share based on broker''s

purchase note Expenditure

Expenses are accounted for on accrual basis and provision is made for all known losses and liabilities.

Investments

Current investments are stated at the lower of cost and fair value. Long-term investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long-term investments. Investments are classified into current and long-term investments.

Investments that are readily realisable and are intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as non current investments.

Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there is a change in the estimated recoverable value.

Borrowing Costs

Borrowing cost attributable to acquisition, construction and production of qualifying assets is capitalized as part of cost of such assets. Qualifying assets are the assets which takes substantial period of time to become ready for intended use or sale. All other borrowing costs are charged to statement of Profit & loss.

Taxation

Provision for current Income Tax is made on the taxable income using the applicable tax rates and tax laws. Deferred tax assets or liabilities arising on account of timing differences between book and tax profits, which are capable of reversal in one or more subsequent years is recognized using tax rate and tax laws that have been enacted or subsequently enacted. Deferred tax asset in respect of unabsorbed depreciation and carry forward losses are not recognized unless there is sufficient assurance that there will be sufficient future taxable income available to realize such losses.

Lease

The company bifurcate its lease contract into Operating and Finance lease, as per AS - 19. Operating Lease is a agreement in which a significant portion of the risks and rewards of ownership are retained by the lessor. In finance lease significant portion of the risks and rewards are transferred to leasee. Lease Rentals in respect of operating lease arrangements are charged to the Statement of Profit & Loss.

Earnings per Share

Basic earning per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

Stock in Trade

Shares are valued at cost or market value, whichever is lower. The comparison of Cost and Market value is done separately for each category of Shares.

Units of Mutual Funds are valued at cost or market value whichever is lower. Net asset value of units declared by mutual funds is considered as market value for non-exchange traded Mutual Funds.

Contingent Liabilities & Provisions

A provision is recognised when there is a present obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and in respect of which reliable estimate can be made. Provision is not discounted to its present value and is determined based on the best estimate required to settle the obligation at the year end date.

These are reviewed at each year end date and adjusted to reflect the best current estimate.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

Segment reporting

The company operates in capital market which is only identifiable reporting segment under AS-17 Segment Reporting issued by the Institute of Chartered Accountants of India

Foreign Currency Transactions

Foreign currency transactions are accounted for at the exchange rates prevailing at the date of the transaction. The year end balances in the payable/receivable account are reported on the basis of closing exchange rate of respective currency. Gains and losses resulting from the settlement of such transactions in foreign currencies are recognised in the profit and loss account on realization date. Forward exchange contracts outstanding as at the year end on account of firm commitment transactions are marked to market and the losses, if any are recognized in the profit and loss account and gains are ignored in accordance with the Announcement of the Institute of Chartered Accountants of India on ''Accounting for Derivatives'' issued in March 2008.

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Mar 31, 2013

The significant accounting policies followed by the company are as stated below :

a. Inventories

Stock-in-trade has been valued at cost or market price whichever is lower

b. Revenue Recognition

Items of Income and Expenditure are recognized on accrual and prudent basis

c. Fixed Assets and Depreciation

Fixed Assets have been capitalized at cost inclusive of all expenses incidental to acquisition of such assets. Depreciation on fixed assets have been provided for on w. d. v. method as per the rates prescribed under schedule XIV of the said Act.

d. Taxes on Income

Provision for Current Income Tax is made on the taxable income using the applicable tax rates and tax laws. Deferred tax assets or liabilities arising on account of liming differences which are capable of reversal in one or more subsequent years is recognized using the tax rates and tax laws that have been enacted or subsequently enacted Deferred tax assets in respect of unabsorbed depreciation and carry forward losses are not recognized unless there is sufficieni assurance that there will be sufficient future taxable income available to realize such losses

e Retirement Benefits

As none of the employees have completed the minimum length of service as provided in the Payment of Gratuity Act. 1972 no provision for gratuity is required to be made

f. Miscellaneous Expenditure

Miscellaneous Expenditure not written off is amortized over a period having due regard to its nature and benefits derived thereon

g. Investments are valued at cost

h. Expenditure in foreign currency during the year - Nil