Accounting Policies of Indergiri Finance Ltd. Company

Mar 31, 2024

2 Material Accounting Policies

2.1 Basis of preparation

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS)
notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time).

The financial statements have been prepared on a hstorical cost basis, except for the following assets and liabilities
which have been measured at fair value or revalued amount:

- Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial
instruments),

The financial statements are presented in Indian Rupees (INR) and all values are rounded to the nearest Thousand,
except when otherwise indicated.

The preparation of financial statements requires the use of certain critical accounting estimates and assumptions
that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosed amount of contingent
liabilities. Areas involving a higher degree of judgement or complexity, or areas where assumptions are significant to
the Company are discussed in Note 3 - Significant accounting judgements, estimates and assumptions.

2.2 Presentation of financial statements

The financial statements of the company are presented as per Division III of the Schedule III to the Companies Act,
2013.

Financial assets and financial liabilities are generally reported gross in the Balance Sheet. They are only offset and
reported net when, in addition to having an unconditionally legally enforceable right to offset the recognised amounts
without being contingent on a future event, the parties also intend to settle on a net basis in all of the following
circumstances:

a. The normal course of business

b. The event of default

c. The event of insolvency or bankruptcy of the Company and/or its counterparties

2.3 Statement of Compliance

This financial statements of the Company has been prepared in accordance with Indian Accounting Standards as per the
Companies (Indian Accounting Standards) Rules, 2015 as amended and notified under Section 133 of the Companies
Act, 2013 and the other relevant provisions of the Act.

2.4 Summary of material accounting policies

(a) Revenue from operations

(i) Interest Income

Interest income is recognised on a time proportion basis taking into account the amount outstanding and the
efffective interest rate (“EIR”).

The EIR is computed:

a. As the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to the gross carrying amount of a financial asset.

b. By considering all the contractual terms of the financial instrument (for example, prepayment, extension,
call and similar options) in estimating the cash flows.

c. Including all fees received between parties to the contract that are an integral part of the effective interest
rate, transaction costs, and all other premiums or discounts.

Any subsequent changes in the estimation of the future cash flows is recognised in interest income with the
corresponding adjustment to the carrying amount of the assets.

(ii) Dividend Income
Dividend income is recognised:

a. When the right to receive the payment is established,

b. It is probable that the economic benefits associated with the dividend will flow to the entity and

c. The amount of the dividend can be measured reliably

Dividend Income is disclosed seperately in Statement of Profit and Loss and not as Fair Value Changes on
Financial Assets at FVTPL.

(iii) Processing Fees

Fees is recognised when the Company satisfies the performance obligation, at fair value of the consideration
received or receivable based on a five-step model as set out below, unless included in the effective interest
calculation:

Step 1: Identify contract(s) with a customer: A contract is defined as an agreement between two or more parties
that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.

Step 2: Identify performance obligations in the contract: A performance obligation is a promise in a contract
with a customer to transfer a good or service to the customer.

Step 3: Determine the transaction price: The transaction price is the amount of consideration to which the
Company expects to be entitled in exchange for transferring promised goods or services to a customer,
excluding amounts collected on behalf of third parties.

Step 4: Allocate the transaction price to the performance obligations in the contract: For a contract that has
more than one performance obligation, the Company allocates the transaction price to each performance
obligation in an amount that depicts the amount of consideration to which the Company expects to be entitled
in exchange for satisfying each performance obligation.

Step 5: Recognise revenue when (or as) the Company satisfies a performance obligation

(iv) Net gain on Fair value changes

Any differences between the fair values of financial assets classified as FVTPL held by the Company on the
balance sheet date is recognised as an unrealised gain / loss. In cases there is a net gain in the aggregate, the
same is recognised in “Net gains on fair value changes” under Revenue from operations and if there is a net
loss the same is disclosed as “Net loss on fair value changes” under Expenses in the Statement of Profit and
Loss.

Similarly, any realised gain or loss on sale of financial instruments measured at FVTPL and debt instruments
measured at FVOCI is recognised in net gain / loss on fair value changes.

However, Net gain / loss on derecognition of financial instruments classified as amortised cost is presented
separately under the respective head in the Statement of Profit and Loss.

(b) Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.

(i) Initial measurement of financial instruments

Financial assets and financial liability are initially measured at fair value. Transaction cost that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities recorded at fair value through profit & loss (FVTPL)), are added to or subtracted
from the fair value of financial assets or financial liabilities, as appropriate, on initial recognition. Transaction
cost directly attributable to the acquisition of financial assets or financial liabilities at FVTPL are recognized
immediately in profit or loss.

(ii) Classification & 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 either:

Financial assets at amortised cost (AC)

A financial asset is measured at amortised cost if it is held within a business model whose objective is to
hold assets for collecting contractual cash flows and contractual terms of the financial asset give rise on
specified dates to cash flows that are solely for the payments of principal and interest on the principal amount
outstanding. The changes in carrying value of financial assets is recognised in profit and loss account.

Financial assets at fair value through other comprehensive income (FVTOCI)

A financial asset is measured at FVTOCI if it is held within business model whose objective is achieved by
both collecting contractual cash flows and selling financial assets and the contractual terms of the financial
assets that give rise to cash flows on specified dates, that represent solely payments of principal and interest
on the principal amount outstanding. The changes in fair value of financial assets is recognised in Other
Comprehensive Income.

Financial Assets at fair value through profit & loss (FVTPL)

A financial asset which is not classified in any of above categories are measured at FVTPL. The Company
measures all financial assets classified as FVTPL at fair value at each reporting date. The changes in fair value
of financial assets is recognised in Profit and loss account.

(c) Financial assets and liabilities

(i) Amortised cost and effective interest method

The effective interest method is a method of calculating the amortised cost of a debt instrument and of
allocating interest income over the relevant period.

For the financial instrument other than purchased or originated credit-impaired financial assets, the effective
interest rate is the rate that exactly discounts estimated future cash flows (including all fees and points paid
or received that form an integral part of the effective interest rate, transaction costs and other premiums
or discounts) excluding expected credit losses, through the expected life of the debt instrument, or, where
appropriate, a shorter period, to the gross carrying amount of the debt instrument on initial recognition.

The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition
minus the principal repayments, plus the cumulative amortisation using the effective interest method of any
difference between that initial amount and the maturity amount, adjusted for any loss allowance. On the other
hand, the gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting
for any loss allowance.

(ii) Financial assets held for trading

The Company classifies financial assets as held for trading when they have been purchased or issued primarily
for short-term profit making through trading activities or form part of a portfolio of financial instruments
that are managed together, for which there is evidence of a recent pattern of short-term profit taking. Held-
for-trading assets are recorded and measured in the balance sheet at fair value. Changes in fair value are
recognised in net gain on fair value changes.

(iii) Investment in Equity instruments

The Company subsequently measures all equity investments at FVTPL, unless the Company’s management
has elected to classify irrevocably some of its strategic equity investments to be measured at FVOCI, when
such instruments meet the definition of Equity under Ind AS 32 Financial Instruments: Presentation are not
held for trading. Such classification is determined on an instrument-by-instrument basis.

(iv) Financial Liabilities

All the financial liabilities are measured at amortised cost except loan commitments, financial guarantees.

(v) Financial liabilities and equity instruments

Financial instruments issued by the Company are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangements and the definitions of a financial liability and
an equity instrument

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting
all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of
direct issue costs.

(vi) Reclassification of financial assets and financial 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. The
company didn’t reclassify any of its financial assets or liabilities in current period and previous period.

(d) Derecognition of financial assets and liabilities

(i) Derecognition of financial asset

A financial asset (or, where applicable a part of a financial asset or a 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 the rights to receive cash flows from the financial asset or

- It retains the contractual rights to receive the cash flows of the financial asset but assumed a contractual
obligation to pay the cash flows in full without material delay to third party under ‘pass through’
arrangement.

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 restrictions on the transfer.

(ii) Derecognition of 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, including modified contractual
cash flow recognised as new financial liability, is recognised in the statement of profit and loss.

Impairment of financial assets

The Company records allowance for expected credit losses for financial assets carried at amortised cost and
all debt financial assets not held at FVTPL, in this section all referred to as ‘Financial instruments’. Equity
instruments are not subject to impairment under Ind AS 109.

ECL is a probability-weighted estimate of credit losses. A credit loss 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
discounted at the original effective interest rate. Because ECL consider the amount and timing of payments, a
credit loss arises even if the entity expects to be paid in full but later than when contractually due.

Simplified Approach

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on loan granted.
The application of simplified approach does not require the Company to track changes in credit risk. Rather,
it recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial
recognition. The Company uses a provision matrix to determine impairment loss allowance. However, if
receivables contain a significant financing component, the Company chooses as its accounting policy to
measure the loss allowance by applying general approach to measure ECL.

General Approach

The Company records allowance for expected credit losses for all loans, other financial assets not held at fair
value through profit or loss (FVTPL), together with financial guarantee contracts, 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), 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.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of
a financial instrument. The 12-month ECL is the portion of Lifetime ECL that represent the ECLs that result
from default events on a financial instrument that are possible within the 12 months afer the reporting date.

The Company has established a policy to perform an assessment, at the end of each reporting period, of
whether a fnancial 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. The Company
does the assessment of significant increase in credit risk at a borrower level. If a borrower has various facilities
having different past due status, then the highest days past due (DPD) is considered to be applicable for all the
facilities of that borrower.

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

All exposures where there has not been a significant increase in credit risk since initial recognition or that has
low credit risk at the reporting date and that are not credit impaired upon origination are classified under this
stage. The Company classifies all standard advances and advances upto 30 days default under this category.
Stage 1 loans also include facilities where the credit risk has improved and the loan has been reclassified from
Stage 2 or Stage 3.

Stage 2

All exposures where there has been a significant increase in credit risk since initial recognition but are not
credit impaired are classified under this stage. 30 Days Past Due is considered as significant increase in credit
risk.

Stage 3

All exposures assessed as credit impaired when one or more events that have a detrimental impact on the
estimated future cash fows of that asset have occurred are classified in this stage. For exposures that have
become credit impaired, a lifetime ECL is recognised and interest revenue is calculated by applying the
effective interest rate to the amortised cost (net of provision) rather than the gross carrying amount. 90 Days
Past Due is considered as default for classifying a financial instrument as credit impaired. If an event (for e.g.
any natural calamity) warrants a provision higher than as mandated under ECL methodology, the Company
may classify the financial asset in Stage 3 accordingly.

Upgradation of accounts classified as Stage 3/Non-performing assets (NPA) - The Company upgrades loan
accounts classified as Stage 3/ NPA to ‘standard’ asset category only if the entire arrears of interest, principal
and other amount are paid by the borrower and there is no change in the accounting policy followed by the
Company in this regard.

(e) Fair value measurement

The Company measures financial instruments at fair value at each balance sheet date using various valuation
techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.

The Company’s accounting policies require, measurement of certain financial / non-financial assets and liabilities
at fair values (either on a recurring or non-recurring basis). Also, the fair values of financial instruments measured
at amortized cost are required to be disclosed in the said financial statements.

The Company is required to classify the fair valuation method of the financial / non-financial assets and liabilities,
either measured or disclosed at fair value in the financial statements, using a three level fair-value-hierarchy (which
reflects the significance of inputs used in the measurement). Accordingly, the Company uses valuation techniques
that are appropriate in the circumstances and for which sufficient data is available to measure fair value, maximizing
the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized
within the fair value hierarchy described as follows:

Level 1 financial instruments:

Those where the inputs used in the valuation are unadjusted quoted prices from active markets for identical assets
or liabilities that the Company has access to at the measurement date. The Company considers markets as active
only if there are sufficient trading activities with regards to the volume and liquidity of the identical assets or
liabilities and when there are binding and exercisable price quotes available on the balance sheet date.

Level 2 financial instruments:

Those where the inputs that are used for valuation and are significant, are derived from directly or indirectly
observable market data available over the entire period of the instrument’s life. Such inputs include quoted prices
for similar assets or liabilities in active markets, quoted prices for identical instruments in inactive markets
and observable inputs other than quoted prices such as interest rates and yield curves, implied volatilities, and
credit spreads. In addition, adjustments may be required for the condition or location of the asset or the extent to
which it relates to items that are comparable to the valued instrument. However, if such adjustments are based on
unobservable inputs which are significant to the entire measurement, the Group will classify the instruments as
Level 3.

Level 3 financial instruments:

Those that include one or more unobservable input that is significant to the measurement as whole.

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines
whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the
lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

The Company periodically reviews its valuation techniques including the adopted methodologies and model
calibrations. Therefore, the Company applies various techniques to estimate the credit risk associated with its
financial instruments measured at fair value, which include a portfolio-based approach that estimates the expected
net exposure per counterparty over the full lifetime of the individual assets, in order to reflect the credit risk of the
individual counterparties for non-collateralised financial instruments.

The Company evaluates the levelling at each reporting period on an instrument-by-instrument basis and reclassifies
instruments when necessary based on the facts at the end of the reporting period.

(f) Earnings per share:

Basic earnings per share is computed by dividing the net profit after tax attributable to the equity shareholders for
the year by the weighted average number of equity shares outstanding for the year.

Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue
equity shares were exercised or converted during the year. Diluted earnings per share is computed by dividing the
net profit after tax attributable to the equity shareholders for the year by weighted average number of equity shares
considered for deriving basic earnings per share and weighted average number of equity shares that could have
been issued upon conversion of all potential equity shares.

(g) Property, plant and equipment

All items of property, plant and equipment are measured at cost less accumulated depreciation and impairment loss
if any. The cost comprises the purchase price and incidental expenses directly attributable to bringing the asset to
the location and condition necessary for it to be capable of operating in the manner intended by the management.

Changes in the expected useful life are accounted for by changing the amortization period or methodology, as
appropriate, and treated as changes in accounting estimates.

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 recognized in profit or loss during the reporting
period, as and when they are incurred.

Depreciation is calculated using the straight-line method to write down the cost of property and equipment to
their residual values over their estimated useful lives which is in line with the estimated useful life as specified in
Schedule II of the Companies Act, 2013.

As per the requirement of Schedule II of the Companies Act, 2013, the Company has evaluated the useful lives
of the respective fixed assets which are as per the provisions of Part C of the Schedule II for calculating the
depreciation. The estimated useful lives of the fixed assets are as follows:

Furniture and fixtures 10 years

Computer and data processing equipment 3 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.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. The carrying amount of those components which have been
separately recognised as assets is derecognised at the time of replacement thereof. Any gain or loss arising on the
disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales
proceeds and the carrying amount of the asset and is recognised in profit or loss.

(h) Impairment of non-financial assets

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired
based on internal/external factors. If any such indication exists, the Company estimates the recoverable amount of
the asset. If such recoverable amount of the asset or the recoverable amount of cash generating unit which the asset
belongs to is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction
is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet
date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is
reassessed, and the impairment is reversed subject to a maximum carrying value of the asset before impairment.

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Mar 31, 2014

1.1 Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Reserve Bank of India (''RBI'') as applicable to a Non Banking Finance Company. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

1.2 Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

1.3 Tangible Fixed Assets

Tangible Fixed Assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to it''s working condition for it''s intended use.

1.4 Depreciation on Tangible Fixed Assets

Depreciation on tangible fixed assets is provided on a straight line basis from the date the asset is ready to use or put to use, whichever is earlier at the rates prescribed in the Schedule XIV to the Companies Act 1956. In respect of assets sold, depreciation is provided upto the date of disposal.

1.5 Impairment of Tangible and Intangible Assets

The carrying amount of assets is reviewed at each balance sheet date if there is any indication of impairment based on intemal/extemal factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets, net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.6 Investments

Investments are classified as long term and current in accordance with the Accounting Standard on ''Accounting for Investments'' (AS 13) issued by the Institute of Chartered Accountants of India. Long-term investments are valued at acquisition cost unless the fall in value is of permanent nature. Current investments are valued at lower of cost and market value and in case of unquoted shares lower of cost or break up value. The break up value of unquoted investment is determined as per the Non Banking Prudential Norms Directions, 1998. Provision for diminution in the value of investments is made in accordance with the directions issued by Reserve Bank of India and recognized through provision for diminution in the value of investments.

In accordance with the Note No. 1 of Revised Schedule VI to the Companies Act, 1956, the portion of the Long Term Investments classified above, and expected to be realised within 12 months of the reporting date, have been classified as current investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.7 Stock in Trade

The securities acquired with the intention of short term holding and trading positions are considered as stock-in-trade and disclosed as current assets and non current assets depending upon the holding period. Stock in trade is valued in accordance accounting policy mentioned under the head investments.

1.8 Revenue Recognition

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

a) Income from Advisory Services

Income from Advisory Services are accounted for as and when the relevant services are rendered and revenue is recognised using completed service contract method except where the recovery is uncertain in which case it is accounted for on receipt.

b) Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Revenue from Operations" in the statement of profit and loss.

c) Dividends

Dividend income is recognized when the company''s right to receive dividend is established on the reporting date.

d) Profit/ Loss on sale of Investments/ Stock in Trade

Profit/loss on the sale of investments/ stock in trade is dealt with at the time of actual sale except for shares held as stock in trade if the fall in value is other than temporary, the valuation of the same is done as per RBI prudential norms as applicable to the NBFC.

1.9 Retirement and other employee benefits

The Company has adopted the revised Accounting Standard 15 - Accounting for Employee Benefits. The accounting policy followed by the Company in respect of its employee benefit schemes is set out below:

Gratuity: Short term employee benefits are accounted in the period during which the services have been rendered. Defined contribution plans such as Provident Fund Act 1952 is not applicable to the Company

Leave Encashment:The employees of the Company are entitled to leave as per the leave policy of the Company however no carry forward is permitted and the same if any remain balance is encashed at the end of the year.

1.10 Income Taxes

Income tax expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income-tax law) & the deferred tax charge or benefit (reflecting the tax effect of timing differences between accounting income and taxable income for the period).

Deferred Taxation: The deferred tax charge or benefit and the corresponding deferred tax liabilities and assets are recognised using the tax rates that have been enacted or substantially enacted as at the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the asset can be realised in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of the assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonable/virtually certain (as the case may he) to be realised.

1.11 Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 - Earning per Share prescribed by the Companies (Accounting Standards) Rules, 2006.

1.12 Segment Reporting Policies

Identification of segments:The Company''s operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

Unallocated items Unallocated items include income and expenses which are not allocated to any business segment.

Segment Policies: The company prepares its segment information in conformity with the accounting policies for preparing and presenting the financial statements of the company as a whole.

1.13 Provisions

The company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amounts of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.. If it is no longer probable that the outflow of resources would he required to settle the obligation, the provision is reversed.

1.14 Contingent Liabilities /Assets

A contingent liabilities is a possible obligation that arise from past events whose existence will be confirmed by the occurency or non occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.

Contingent assets are not recognised in the financial statements. However contingent assets are assessed continually and if it is virtually certain that an economic benefit will rise, asset and related income are recognised in the period in which the change occurs.

1.15 Cash and Cash Equivalents

Cash and Cash Equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short term investments with an original maturity of three months or less, as per Accounting Standard 3 "Cash Flows".

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Mar 31, 2013

1.1 Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Reserve Bank of India CRBI'') as applicable to a Non Banking Finance Company. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

1.2 Change in Accounting Policy:

Presentation and Disclosure of Financial Statement

During the year ended 31-03-2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company, for preparation and presentation of its financial statements. he adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

1.3 Use of Estimates:

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

1.4 Tangible Fixed Assets

Tangible Fixed Assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to it''s working condition for it''s intended use.

1.5 Depreciation on Tangible Fixed Assets

Depreciation on tangible fixed assets is provided on a straight line basis from the date the asset is ready to use or put to use, whichever is earlier at the rates prescribed in the Schedule XIV to the Companies Act 1956. In respect of assets sold, depreciation is provided upto the date of disposal.

1.6 Impairment of Tangible and Intangible Assets:

The carrying amount of assets is reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets, net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.7 Investments:

Investments are classified as long term and current in accordance with the Accounting Standard on "Accounting for Investments'' (AS 13) issued by the Institute of Chartered Accountants of India. Long-term investments are valued at acquisition cost unless the fall in value is of permanent nature. Current investments are valued at lower of cost and market value and in case of unquoted shares lower of cost or break up value. The break up value of unquoted investment is determined as per the Non Banking Prudential Norms Directions, 1998. Provision for diminution in the value of investments is made in accordance with the directions issued by Reserve Bank of India and recognized through provision for diminution in the value of investments.

In accordance with the Note No. 1 of Revised Schedule VI to the Companies Act, 1956, the portion of the Long Term Investments classified above, and expected to be realised within 12 months of the reporting date, have been classified as current investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.08 Stock in Trade

The securities acquired with the intention of short term holding and trading positions are considered as stock-in-trade and disclosed as current assets. Stock in trade of shares being current in nature is valued in accordance accounting policy mentioned under the head investments.

1.09 Revenue Recognition

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

a) Income from Advisory Services

Income from Advisory Services are accounted for as and when the relevant services are rendered and revenue is recognised using completed service contract method except where the recovery is uncertain in which case it is accounted for on receipt.

b) Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Revenue from Operations" in the statement of profit and loss.

c) Dividends

Dividend income is recognized when the company''s right to receive dividend is established on the reporting date.

d) Profit/ Loss on sale of Investments/ Stock in Trade

Profit/loss on the sale of investments/ stock in trade is dealt with at the time of actual sale except for shares held as stock in trade if the fall in value is other than temporary , the valuation of the same is done as per RBI prudential

1.10 Retirement and other employee benefits

The Company has adopted the revised Accounting Standard 15 - Accounting for Employee Benefits. The accounting policy followed by the Company in respect of its employee benefit schemes is set out below:

Gratuity: Short term employee benefits are accounted in the period during which the services have been rendered.

Defined contribution plans such as Provident Fund Act 1952 is not applicable to the Company

Leave Encashment:

The employees of the Company are entitled to leave as per the leave policy of the Company however no carry forward is permitted and the same if any remain balance is encashed at the end of the year.

1.11 Income Taxes

Income tax expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income-tax law) & the deferred tax charge or benefit (reflecting the tax effect of timing differences between accounting income and taxable income for the period).

Deferred Taxation:

The deferred tax charge or benefit and the corresponding deferred tax liabilities and assets are recognised using the tax rates that have been enacted or substantially enacted as at the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the asset can be realised in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of the assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonable/virtually certain (as the case may be) to be realised.

1.12 Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 - Earning per Share prescribed by the Companies (Accounting Standards) Rules, 2006.

1.13 Segment Reporting Policies

Identification of segments:

The Company''s operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

Unallocated items:

Unallocated items include income and expenses which are not allocated to any business segment.

Segment Policies:

The company prepares its segment information in conformity with the accounting policies for preparing and presenting the financial statements of the company as a whole.

1.14 Provisions

The company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amounts of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates. . If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

1.15 Contingent Liabilities / Assets

A contingent liabilities is a possible obligation that arise from past events whose existence will be confirmed by the occurency or non occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.

Contingent assets are not recognised in the financial statements. However contingent assets are assessed continually and if it is virtually certain that an economic benefit will rise, asset and related income are recognised in the period in which the change occurs.

1.16 Cash and Cash Equivalents

Cash and Cash Equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short term investments with an original maturity of three months or less, as per Accounting Standard 3 "Cash Flows".

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Mar 31, 2012

1.1 Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Reserve Bank of India ('RBI') as applicable to aNon Banking Finance Company. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

1.2 Change in Accounting Policy:

Presentation and Disclosure of Financial Statement

During the year ended 31 -03-2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company, for preparation and presentation of its financial statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

1.3 Use of Estimates:

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

1.4 Tangible Fixed Assets

Tangible Fixed Assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to it's working condition for its intended use.

1.5 Depreciation on Tangible Fixed Assets

Depreciation on tangible fixed assets is provided on a straight line basis from the date the asset is ready to use or put to use, whichever is earlier at the rates prescribed in the Schedule XIV to the Companies Act 1956. In respect of assets sold, depreciation is provided up to the date of disposal.

1.6 ImpairmentofTangibleand IntangibleAssets:

The carrying amount of assets is reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets, net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.

1.7 Investments:

Investments are classified as long term and current in accordance with the Accounting Standard on 'Accounting for Investments' (AS 13) issued by the Institute of Chartered Accountants of India. Long-term investments are valued at acquisition cost unless the fall in value is of permanent nature. Current investments are valued at lower of cost and market value and in case of unquoted shares lower of cost or break up value. The breakup value of unquoted investment is determined as per the Non Banking Prudential Norms Directions, 1998. Provision for diminution in the value of investments is made in accordance with the directions issued by Reserve Bank of India and recognized through provision for diminution in the value of investments.

In accordance with the Note No. 1 of Revised Schedule VI to the Companies Act, 1956, the portion of the Long Term Investments classified above, and expected to be realized within 12 months of the reporting date, have been classified as current investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.8 Stock in Trade

The securities acquired with the intention of short term holding and trading positions are considered as stock-in-trade and disclosed as current assets. Stock in trade of shares being current in nature is valued in accordance accounting policy mentioned under the head investments.

1.9 Revenue Recognition

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

a) Income from Advisory Services

Income from Advisory Services are accounted for as and when the relevant services are rendered and revenue is recognized using completed service contract method except where the recovery is uncertain in which case it is accounted for on receipt.

b) Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Revenue from Operations" in the statement of profit and loss.

c) Dividends

Dividend income is recognized when the company's right to receive dividend is established on the reporting date.

d) Profit/ Loss 011 sale of Investments/Stock in Trade

Profit/loss on the sale of investments/ stock in trade is dealt with at the time of actual sale except for shares held as stock in trade if the fall in value is other than temporary, the valuation of the same is done as per RBI prudential norms as applicable to theNBFC.

1.10 Retirement and other employee benefits

The Company has adopted the revised Accounting Standard 15 - Accounting for Employee Benefits. The accounting policy followed by the Company in respect of its employee benefit schemes is set out below :

Gratuity: Short term employee benefits are accounted in the period during which the services have been rendered. Defined contribution plans such as Provident Fund Act 1952 is not applicable to the Company

Leave Encashment: The employees of the Company are entitled to leave as per the leave policy of the Company however no carry forward is permitted and the same if any remain balance is encased at the end of the year.

1.11 Income Taxes

Income tax expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income- tax law) & the deferred tax charge or benefit (reflecting the tax effect of timing differences between accounting income and taxable income for the period).

Deferred Taxation: The deferred tax charge or benefit and the corresponding deferred tax liabilities and assets are recognized using the tax rates that have been enacted or substantially enacted as at the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the asset can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of the assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonable/virtually certain (as the case may be) to be realized.

1.12 Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 - Earning per Share prescribed by the Companies (Accounting Standards) Rules, 2006.

1.13 Segment Reporting Policies

Identification of segments: The Company's operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

Unallocated items: Unallocated items include income and expenses which are not allocated to any business segment.

Segment Policies: The company prepares its segment information in conformity with the accounting policies for preparing and presenting the financial statements of the company as a whole.

1.14 Provisions

The company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amounts of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

1.15 Contingent Liabilities/Assets

A contingent liabilities is a possible obligation that arise from past events whose existence will be confirmed by the occurency or non occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.

Contingent assets are not recognized in the financial statements. However contingent assets are assessed continually and if it is virtually certain that an economic benefit will rise, asset and related income are recognized in the period in which the change occurs.

1.16 Cash and Cash Equivalents

Cash and Cash Equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short term investments with an original maturity of three months or less, as per Accounting Standard 3 "Cash Flows'".

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Mar 31, 2010

(A) BASIS OF ACCOUNTING: The accounts are prepared as a going concern under historical cost conversion in accordance with the requirements of the Companies Act, 1956 and generally accepted accounting policies.

(B) METHOD OF ACCOUNTING: The Company follows accrual system of accounting and recognizes income and expenditure on accrual basis unless otherwise stated elsewhere.

(C) INCOME RECOGNITION: /. In respect of loans and interest bearing advances, interest is calculated at contracted rate on amount outstanding and on a time proportion. II. The difference between the carrying amount of investment and the sale proceed (net of expenses) is recognized in the Profit and Loss Account in the year of sale.

(D) DEPRECIATION: Depreciation of owned assets is provided as per Straight Line Method at the rates prescribed under Schedule XIV of the Companies Act, 1956.

(E) INVESTMENTS: Investments are classified as long term and current in accordance with the Accounting Standard on Accounting for Investments (AS 13) issued by the Institute of Chartered Accountants of India. Long-term investments are valued at acquisition cost unless the fall in value is of permanent nature. Current investments are valued at lower of cost and market value and in case of unquoted shares lower of cost or break up value. The break up value of unquoted investment is determined as per the Non Banking Prudential Norms Directions, 1998. Provision for diminution in the value of investments is made in accordance with the directions issued by Reserve Bank of India and recognized through provision for diminution in the value of investments.

(F) STOCK IN TRADE: Stock in trade of shares being current in nature is valued in accordance accounting policy mentioned under the head investments.

(G) PRELIMINARY AND ISSUE EXPENSES: Preliminary and issue expenses are being written off in 10 equal instalments.

(H) PROVISION FOR NON-PERMOFORMING ASSETS: Provision for doubtful loans and advances are made to the extent of 100% of the amount of such loans and advances and debited to the Profit and Loss Account. Provision for diminution in the value of investment is made as mentioned in the clause (E) above and the amount is debited to the Profit and Loss Account.

(I) INCOME TAX: The accounting treatment for Income Tax is based on the Accounting Standard 22 on Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India.

(J) EMPLOYEES BENEFIT: Short term employee benefits are accounted in the period during which the services have been rendered. Defined contribution plans such as Provident Fund Act 1952 is not applicable to the Company The employees of the Company are entitled to leave as per the leave policy of the Company however no carry forward is permitted and the same if any remain balance is encashed at the end of the year.