Accounting Policies of Munoth Financial Services Ltd. Company

Mar 31, 2024

1. MATERIAL ACCOUNTING POLICIES FOR THE YEAR ENDED 31ST MARCH, 2024

1.1 Basis of preparation Statement of compliance

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values, the provisions of the Companies Act, 2013 (“the ACT”) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements are prepared in accordance with Ind AS prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

Use of estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, income and expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognized prospectively in current and future periods.

Historical cost convention

The financial statements have been prepared on a historical cost basis, except for the following:

(a) certain financial assets and liabilities (including derivative instruments) and contingent consideration that is measured at fair value;

(b) assets held for sale - measured at fair value less cost to sell;

(c) defined benefit plans - plan assets measured at fair value; and

1.2 Current and Non Current Classification

An entity presents current and non-current assets and current and non-current liabilities as separate classifications in its balance sheet

An entity shall classify an asset as current when:

(a) It expects to realise the asset, or intends to sell or consume it, in its normal operating cycle;

(b) It holds the asset primarily for the purpose of trading;

(c) It expects to realise the asset within twelve months after the reporting period; or

(d) The asset is cash or a cash equivalent (as defined in Ind AS 7 Statement of Cash Flows) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets shall be classified as non-current.

An entity shall classify a liability as current when:

(a) It expects to settle the liability in its normal operating cycle;

(b) It holds the liability primarily for the purpose of trading;

(c) The liability is due to be settled within twelve months after the reporting period; or

(d) It does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

All other liabilities shall be classified as non-current.

1.3 Functional and presentation currency

These financial statements are presented in Indian Rupees (INR), which is the Company''s functional currency. All financial information presented in INR has been rounded to the nearest thousands (upto two decimals).

1.4 Critical accounting estimates and management judgements

In application of the accounting policies, which are described in note 1, the management of the Company is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and assumptions are based on historical experience and other factors that are considered to be relevant.

(A) Current Tax

Calculations of income taxes for the current period are done based on applicable tax laws and management''s judgement by evaluating positions taken in tax returns and interpretations of relevant provisions of law.

(B) Deferred Tax Assets (including MAT Credit Entitlement)

Significant management judgement is exercised by reviewing the deferred tax assets at each reporting date to determine the amount of deferred tax assets that can be retained/recognized, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

(C) Fair Value

Management uses valuation techniques in measuring the fair value of financial instruments where active market quotes are not available. In applying the valuation techniques, management makes maximum use of market inputs and uses estimates and assumptions that are, as far as possible, consistent with observable data that market participants would use in pricing the instrument. Where applicable data is not observable, management uses its best estimate about the assumptions that market participants would make. These estimates may vary from the actual prices that would be achieved in an arm''s length transaction at the reporting date.

(D) Impairment of Trade Receivables

The impairment for trade receivables are done based on assumptions about risk of default and expected loss rates. The assumptions, selection of inputs for calculation of impairment are based on management judgement considering the past history, market conditions and forward looking estimates at the end of each reporting date.

(E) Impairment of Non-financial assets (PPE/Intangible Assets)

The impairment of non-financial assets is determined based on estimation of recoverable amount of such assets. The assumptions used in computing the recoverable amount are based on management judgement considering the timing of future cash flows, discount rates and the risks specific to the asset.

1.5 Defined benefit plans and Other long term benefits

The cost of the defined benefit plan and other long term employee benefits, and the present value of such obligation are determined by the independent actuarial valuer. An actuarial valuation involves making various assumptions that may differ from actual developments in future. Management believes that the assumptions used by the actuary in determination of the discount rate, future salary increases, mortality rates and attrition rates are reasonable. Due to the complexities involved in the valuation and its long term nature, this obligation is high sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

1.6 Fair Value Measurement

The Company has applied the fair value measurement whenever neccessiated at each Balance Sheet date.

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 particulars at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

i) In the principal market for the asset or liability.

ii) In the absence of a principal market, in the most advantageous market for the asset or liability.

The Principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best Interest.

A fair value measurement of a non- financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and the best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company use valuation techniques that are appropriate in the circumstances and for which sufficient data are 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, based on the lowest level input that is significant to the fair value measurement as a whole :

Level 1 : Quoted (Unadjusted) Market prices in active market for identical assets or liabilities.

Level 2 : Valuation Techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and

Level 3 : Valuation Techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

For assets and liabilities that are recognized in the financial statements on a recurring basis, the company determines whether transfers have occurred between levels in the hierarchy by reassessing 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 has designed the respective team leads to determine the policies and procedures for both recurring and Non- recurring fair value measurement. External valuers are involved, wherever necessary with the approval of Company''s board of directors. Selection criteria include market knowledge, reputation, Independence and whether professional standards are maintained.

For the purpose of fair value disclosure, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risk of the asset and the level of the fair

value hierarchy as explained above. The component wise fair value measurement is disclosed in the relevant notes.

1.7 Property, Plant and Equipment and Intangible Assets

On transition to IND AS, the Company has elected to continue with the carrying value of all of its Property, Plant and Equipment recognized as at April 1, 2016, measured as per the previous GAAP, and use that carrying value as the deemed cost of such property plant and equipment.

The Company has provided the depreciation based on the estimated useful life of respective years and as the change in estimated useful life is considered as change in estimate, accordingly there is no impact of this roll back.

When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred.

Depreciation is calculated on a Written Down Value basis over the estimated useful lives of the assets as follows'' as prescribed under the Schedule II of the Companies Act 2013

An item of property, plant and equipment and any significant part initially recognized is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on Derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the income statement when the asset is derecognized.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial period/year end, and adjusted prospectively, if appropriate, as they are change in estimates

After impairment if any, depreciation is provided on the revised carrying amount of the assets over its remaining useful life. No Depreciation is charged on the Discarded Assets.

1.9 Intangible Assets

1. Intangible assets acquired seperately are measured on initial on recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses.

2. Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asstes may be impaired. The amortization period and the amortization method for an intangible assets with a finite useful lives are reviewed at the end of each reporting period . Changes in the expected useful life/ pattern of consumption of future economic benefit embodied in the assets are considered to modify the amortization period/method and treated as changes in accounting estimate. The amortization expenses are recognized in the statement of profit or loss unless such expenditure forms part of carrying value of another asset.

3. Software are amortized over a period of 3 to 5 years.

1.10 Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating units (CGU) fair valueless costs of disposal and its value in use.

The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or Company of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.

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

1.11 Borrowing costs

Borrowing cost includes interest expense as per Effective Interest Rate (EIR).

Borrowing costs directly attributable to the acquisition or construction of an asset that necessarily takes a substantial period of time to get ready for its intended use are capitalized as part of the cost of the asset until such time that the assets are substantially ready for their intended use. Where funds are borrowed specifically to finance a project, the amount capitalized represents the actual borrowing costs incurred. Where surplus funds are available out of money borrowed specifically to finance project, the income generated from such current investments is deducted from the total capitalized borrowing cost. Where the funds use to finance a project form part of general borrowings, the amount capitalized is calculated using a weighted average of rates applicable to relevant general borrowings of the company during the period/year. Capitalization of borrowing costs is suspended and charged to profit and loss during the extended periods when the active development on the qualifying assets is interrupted.

EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial liability or a shorter period, where appropriate, to the amortized cost of a financial liability after considering all the contractual terms of the financial instrument.

1.12 Revenue Recognition

The Company is engaged in The Company is in the business of providing Stock Broking, DP Operations, Portfolio Advisory Services, Merchant Banking .

In accordance with the Ind As 115 contract with customers revenue is recognized in the followoing manner.

(a) Brokerage Fee income

Brokerage fee income Brokerage income is recognised on the trade date of transaction upon confirmation of the transaction by the stock exchange. The services are point in time in nature.

(b) Income from depository services and portfolio management services

Income from depository services, penal charges and portfolio management services are recognised on the basis of agreements entered into with clients and when the right to receive the income is established. It is recognised at the point in time for transaction charges and others are recognised over the period of service as applicable

(c) Income from distribution of financial products

Commission income from financial products distribution is recognised on the basis of agreements entered into with principals and when the right to receive the income is established. The date of the agreement is considered as point in time when the performance obligation is satisfied. In case of continuinmcg services, the same is recognised over a period of time.

(d) Interest income

Interest income is recognised using the effective interest rate method. Interest income from margin funding business is recognised on loans given to clients on time proportion basis

(e) Dividend income

Dividend income is recognised in the statement of profit or loss on the date that the Company''s right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the entity and the amount of dividend can be reliably measured.

1.13 Income Taxes

Taxes comprise current income tax and deferred tax.

Current income tax

The tax currently payable is based on taxable profit for the period/year. Taxable profit differs from ''profit before tax'' as reported in the statement of profit and loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

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

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

Deferred tax

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

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

(i) When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

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

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

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

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

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognized in correlation to the underlying transaction either in OCI or directly in equity.

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

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Mar 31, 2015

A ] Basis of Preparation

The financial statements have been prepared under the historical cost convention basis in accordance with the Generally Accepted Accounting Principles (GAAP) in India and to comply with the mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006, (as amended), the provisions of the Companies Act, 2013 (to the extent notified) and the Companies Act, 1956 (to the extent applicable). All items of income and expenditure that have a material bearing on the financial statements are recognized on accrual basis.

B] Use of Estimates

The preparation of financial statements is in confirmity with Generally Accepted Accounting Principles requiring management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities as at the date of financial statements and the result of operations during the reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from the estimates.

C] 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.

i. Interest income is recognised on Time Proportion basis taking into account the amount outstanding and the rate applicable.

ii. Dividend Income from Investments is recognised when the Company's right to receive payment is established.

D] Interest on Income Tax Refunds / Demands

It is accounted as Income in the year when granted and as tax expenses when determined by Tax Authorities.

E] Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at Exchange rates prevailing at the time of the Transaction, while those remaining unsettled at the year end are translated at the Year end rates resulting in exchange difference being recognised as Income/Expenses(Net).

F] Taxation

i. Income tax expenses comprises of Current tax and Deferred tax.

ii. Current Income Tax is measured at the amount expected to be paid to the Tax Authorities in accordance with the Indian Income Tax Act,1961.

iii. Deferred Tax assets and liabilities arising on account of Timing differences which are capable of reversal in subsequent periods are recognised using Current Year Tax Rates.

iv. Deferred tax assets are recognized only to the extend there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only when there is a virtual certainty of realization of such assets. The carrying amount of deferred tax assets are reviewed as at each balance sheet date and written down or, written up to reflect the amount that is reasonably / virtually certain (as the case may be ) to be realized.

G] Retirement Benefits

i. Company's contribution under Provident Fund Act are charged to profit and loss account on accrual basis.

ii. The Company has provided for gratuity being the estimated liability in terms of Payment of Gratuity Act, 1972. The liability has not been ascertained on actuarial basis.

H] Fixed Assets & Depreciation

i. Tangible Assets Gross Block :

a) Fixed Assets are stated at cost of acquisition inclusive of Inland freight and any attributable cost of bringing the asset to its working condition for its intended use with due adjustments for Cenvat credits.

Depreciation :

a) The Company provides pro-rata depreciation from the date on which asset is acquired / put to use.

In respect of assets sold, pro-rata depreciation is provided upto the date on which the asset is sold.

On all assets, depreciation has been provided using the Written Down Value method at the rates specified in Part C Schedule II to the Companies Act, 2013. Individual Assets acquired for less than Rs. 5,000 are entirely depreciated in the year of acquisition.

ii. Intangible Assets

Intangible Assets are stated at cost less Amortization thereon. No Amortization has been provided on MSE Membership card.

I] Investments

Investments are long-term in nature and stated at cost. Provision for diminution in value of long- term investments is made only, if such a decline is other than temporary in the opinion of the management. Bonus entitlements are recognised as ex-bonus dates and no cost is attributed to bonus shares.

J] Segment Reporting

The company's business activity falls within a single primary business segment i.e. Capital Market. As such there is no separate reportable segment as per Accounting Standard 17.

K] Earnings Per Share

Basic Earnings per share are calculated by dividing the net Profit/Loss for the period attributable to Equity Shareholders by the Weighted Average Number of Equity Shares outstanding during the period.

For the Purpose of calculating Diluted earnings per share the Net profit/loss for the period attributable to Equity Shareholders by the Weighted Average Number of Equity Shares outstanding during the period are adjusted for the effects of all dilutive Potential Equity shares.

L] Cash Flow Statements

Cash Flows are reported using Indirect Method, whereby profit before tax is adjusted for the effects of transactions of a non cash nature any deferrals or accruals of past or future cash receipts or payments.

The Cash Flow from regular Revenue generating, financing and Investing Activities of the Company are segregated as per Accounting Standard 3.

M] Cash & Cash Equivalents

Cash & Cash Equivalents comprises of Cash at Bank, Cash/ Cheques in Hand and Fixed Deposits with Banks with maturity period of 3 months or less.

N] Provisions & Contingent liabilities

The Current Assets, Loans and Advances other than doubtful have the value at which they are stated in the Balance sheet, if realized in the ordinary course of business. The provision for all known liabilities is adequate and not in excess of the amount reasonably necessary. Possible obligation, whose existence will only be confirmed by the occurance or non occurance of one or more uncertain future events, are disclosed as Contingent liabilities.

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Mar 31, 2014

A ] Basis of Preparation

The financial statements have been prepared under the historical cost convention basis in accordance with the Generally Accepted Accounting Principles (GAAP) in India and to comply with the mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006, (as amended), the provisions of the Companies Act, 2013 (to the extent notified) and the Companies Act, 1956 (to the extent applicable). All items of income and expenditure that have a material bearing on the financial statements are recognized on accrual basis.

B] Use of Estimates

The preparation of financial statements is in confirmity with Generally Accepted Accounting Principles requiring management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities as at the date of financial statements and the result of operations during the reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from the estimates.

C] 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.

i. Interest income is recognised on Time Proportion basis taking into account the amount outstanding and the rate applicable.

ii. Dividend Income from Investments is recognised when the Company''s right to receive payment is established.

D] Interest on Income Tax Refunds / Demands

It is accounted as Income in the year when granted and as tax expenses when determined by Tax Authorities.

E] Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at Exchange rates prevailing at the time of the Transaction, while those remaining unsettled at the year end are translated at the Year end rates resulting in exchange difference being recognised as Income/Expenses(Net).

F] Taxation

i. Income tax expenses comprises of Current tax and Deferred tax.

ii. Current Income Tax is measured at the amount expected to be paid to the Tax Authorities in accordance with the Indian Income Tax Act,1961.

iii. Deferred Tax assets and liabilities arising on account of Timing differences which are capable of reversal in subsequent periods are recognised using Current Year Tax Rates.

iv. Deferred tax assets are recognized only to the extend there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only when there is a virtual certainty of realization of such assets. The carrying amount of deferred tax assets are reviewed as at each balance sheet date and written down or, written up to reflect the amount that is reasonably / virtually certain (as the case may be ) to be realized.

G] Retirement Benefits

i. Company''s contribution under Provident Fund Act are charged to profit and loss account on accrual basis.

ii. The Company has provided for gratuity being the estimated liability in terms of Payment of Gratuity Act, 1972. The liability has not been ascertained on actuarial basis.

H] Fixed Assets & Depreciation

i. Tangible Assets Gross Block :

a) Fixed Assets are stated at cost of acquisition inclusive of Inland freight and any attributable cost of bringing the asset to its working condition for its intended use with due adjustments for Cenvat credits.

Depreciation :

a) The Company provides pro-rata depreciation from the date on which asset is acquired / put to use.

In respect of assets sold, pro-rata depreciation is provided upto the date on which the asset 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. Individual Assets acquired for less than Rs. 5,000 are entirely depreciated in the year of acquisition.

ii. Intangible Assets

Intangible Assets are stated at cost less Amortization thereon. No Amortization has been provided on MSE Membership card.

I] Investments

Investments are long-term in nature and stated at cost. Provision for diminution in value of long-term investments is made only, if such a decline is other than temporary in the opinion of the management. Bonus entitlements are recognised as ex-bonus dates and no cost is attributed to bonus shares.

J] Segment Reporting

The company''s business activity falls within a single primary business segment i.e. stock broking & Capital Market. As such there is no separate reportable segment as per Accounting Standard 17.

K] Earnings Per Share

Basic Earnings per share are calculated by dividing the net Profit/Loss for the period attributable to Equity Shareholders by the Weighted Average Number of Equity Shares outstanding during the period.

For the Purpose of calculating Diluted earnings per share the Net profit/loss for the period attributable to Equity Shareholders by the Weighted Average Number of Equity Shares outstanding during the period are adjusted for the effects of all dilutive Potential Equity shares.

L] Cash Flow Statements

Cash Flows are reported using Indirect Method, whereby profit before tax is adjusted for the effects of transactions of a non cash nature any deferrals or accruals of past or future cash receipts or payments.

The Cash Flow from regular Revenue generating, financing and Investing Activities of the Company are segregated as per Accounting Standard 3.

M] Cash & Cash Equivalents

Cash & Cash Equivalents comprises of Cash at Bank, Cash/ Cheques in Hand and Fixed Deposits with Banks with maturity period of 3 months or less.

N] Provisions & Contingent liabilities

The Current Assets, Loans and Advances other than doubtful have the value at which they are stated in the Balance sheet, if realized in the ordinary course of business. The provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.

Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events, are disclosed as Contingent Liabilities.

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Mar 31, 2013

A) Accounting Convention

The accompanying financial statements are consistently prepared under the historical cost convention, on the accrual basis of accounting and comply* with the accounting standards issued by the Institute of Chartered Accountants of India (to the extent applicable) and in accordance with the generally accepted accounting principles, the provisions of the Companies Act, 1956.

b) Fixed Assets and Depreciation :

i) Tangible Assets are stated at cost less accumulated depreciation adjusted by revaluation/ business valuation. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to its working condition for its intended use.The Company provides pro-rata depreciation from the date on which asset is acquired / put to use. In respect of assets sold, pro-rata depreciation is provided upto the date on which the asset 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.

ii) Intangible Assets are stated at cost less Depreciation thereon. No depreciation has been provided on MSE Membership card.

c) Investments:

Investments are long-term in nature and stated at cost. Provision for diminution in value of long-term investments is made only, if such a decline is other than temporary in the opinion of the management. Bonus entitlements are recognised at ex-bonus dates and no cost is attributed to bonus shares.

d) Taxation:

Income tax expenses comprises current tax and deferred tax charge or credit. The deferred tax charge or credit is recognized using current tax rates. Where there is unabsorbed depreciation and/or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

e) Retirement Benefits

i) Company''s contribution under Provident Fund Act are charged to profit and loss account on accrual basis.

ii) The Company has provided for gratuity being the estimated liability in terms of payment of Gratuity Act, 1972. The liability has not been ascertained on actuarial basis.

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Mar 31, 2012

1. Accounting Policies

a) Accounting Convention

The accompanying financial statements are consistently prepared under the historical cost convention, on the accrual basis of accounting and comply with the accounting standards issued by the Institute of Chartered Accountants of India (to the extent applicable) and in accordance with the generally accepted accounting principles, the provisions of the Companies Act, 1956.

b) Fixed Assets and Depreciation :

i) Tangible Assets are stated at cost less accumulated depreciation thereon. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

The Company provides pro-rata depreciation from the date on which asset is acquired / put to use. In respect of assets sold, pro-rata depreciation is provided upto the date on which the asset 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.

ii) Intangible Assets are stated at cost less Depreciation thereon. No depreciation has been provided on MSE Membership card.

c) Investments :

Investments are long-term in nature and stated at cost. Provision for diminution in value of long-term investments is made only, if such a decline is other than temporary in the opinion of the management. Bonus entitlements are recognised as ex-bonus dates and no cost is attributed to bonus shares.

d) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. The deferred tax charge or credit is recognized using current tax rates. Where there is unabsorbed depreciation and/or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

e) Retirement Benefits

i) Company's contribution under Provident Fund Act are charged to profit and loss account on accrual basis.

ii) The Company has provided for gratuity being the estimated liability in terms of payment of Gratuity Act, 1972. The liability has not been ascertained on actuarial basis.

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Mar 31, 2010

A) Accounting Convention

The accompanying financial statements are consistently prepared under the historical cost convention, on the accrual basis of accounting and comply with the accounting standards issued by the Institute of Chartered Accountants of India (to the extent applicable) and in accordance with the generally accepted accounting principles, the provisions of the Compa- nies Act, 1956.

b) Fixed Assets and Depreciation :

Fixed Assets are stated at cost less accumulated depreciation thereon. The cost of fixed assets comprises purchase price and any attributable cost of bringing the asset to its work- ing condition for its intended use.

The Company provides pro-rata depreciation from the date on which asset is acquired / put to use. In respect of assets sold, pro-rata depreciation is provided upto the date on which the asset 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.However no depreciation has been provided on MSE Membership Card.

c) Investments :

Investments are long-term in nature and stated at cost. Provision for diminution in value of long-term investments is made only, if such a decline is other than temporary in the opinion of the management. Bonus entitlements are recognised as ex-bonus dates and no cost is attributed to bonus shares.

d) Taxation :

Income tax expenses comprises current tax and deferred tax charge or credit. The deferred tax charge or credit is recognized using current tax rates. Where there is unabsorbed de- preciation and/or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

e) Retirement Benefits

I) Companys contribution under Provident Fund Act are charged to profit and loss account on accrual basis.

ii) The Company has provided for gratuity being the estimated liability in terms of payment of Gratuity Act, 1972. The liability has not been ascertained on actuarial basis.

2. The companys business activity falls within a single primary business segment i.e. stock broking & Capital Market. As such there is on separate reportable segment as per Accounting Standard 17.

3. Related party disclosures under Accounting Standard - 18.

Related Parties

A ( I ) Associate Companies

a) Munoth Communication Limited

b) Munoth Industries Limited

c) South India Chemicals & Leasing (P) Ltd

d) Maharana Finance & Investments (P) Ltd

e) Shankeswar Finance & Investments (P) Ltd

f) Jaswant Estates (P) Ltd

g) Munoth Negwind Farm (P) Ltd ( II )Key Management personnel and their relatives:- a) Lalchand Munoth

b) Jaswant Munoth

c) Bharat Munoth

d) Vikas Munoth

e) Leela Devi

f) Vijayalaksmi Munoth

g) Aruna Munoth h) Kanchan Munoth