Accounting Policies of PBA Infrastructure Ltd. Company

Mar 31, 2024

Note 2- Significant Accounting Polices

1. Basis of Preparation

The financial statements of the Company have been prepared to comply in all material respects with Indian
Accounting Standards (“Ind AS”) as notified under section 133 of the Companies Act, 2013, (the Act) read
together with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian
Accounting Standards) Amendment Rules, 2016 issued by the Ministry of Corporate Affairs(“MCA”) in addition,
the Guidance notes/announcements issued by the institute of Chartered Accountants of India (ICAI) are also
applied except where compliance with other statutory promulgations requires a different treatment.

Presentation of Financial Statements

The Balance Sheet and Statement of Profit & Loss are prepared and presented in the format set out in
Schedule III to the Companies Act, 2013(“the Act”).The Cash flow statement has been prepared and presented
as per the requirements of Indian Accounting Standards (INDAS-7)”Statement of Cash Flow”. The disclosure
requirements with respect to items in the Balance Sheet and Statement of Profit & Loss as prescribed in the
schedule III to the Act, are presented by way of notes forming parts of accounts along with the other notes
required to the disclosed under the notified Indian Accounting Standards and the equity listing agreement.
Amounts in the financial statement are presented in Indian rupees in Lakhs.

The financial Statements are authorized for issue by the Company’s Board of Directors at their meeting held
on 30th May, 2024.

The preparation of the said financial statements requires the use of certain critical accounting estimates
and judgements. It also requires the management to exercise judgment in the process of applying the
Company’s accounting policies.

2. Operating cycle for current and non-current classification:

All the assets and liabilities have been classified as current or non-current, wherever applicable, as per the
operating cycle of the Company as per the guidance set out in Schedule III to the Act. Operating cycle for the
business activities of the Company covers the duration of the project/ contract/ service including the defect
liability period, wherever applicable, and extends up to the realization of receivables (including retention
monies) within the credit period normally applicable to the respective project.

3. Going Concern

Financial Statement are prepared on a going concerned basis as intended by management based on material
certainty to related to going concern.

4. Accounting Estimates

The preparation of the financial statements, in conformity with the recognition and measurement principles
of Ind AS, requires the management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent liabilities as at the date of financial statements and the
results of operation during the reported period. Although these estimates are based upon management’s
best knowledge of current events and actions, actual results could differ from these estimates which are
recognised in the period in which they are determined.

5. Key accounting estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described below. The Company based its assumptions and
estimates on parameters available when the financial statements were prepared. Existing circumstances
and assumptions about future developments, however, may change due to market changes or circumstances
arising that are beyond the control of the Company. Such changes are reflected in the financial statements
in the period in which changes are made and, if material, their effects are disclosed in the notes to the
financial statements.

a. Contract Estimates

The Company, being a part of construction industry, prepares budgets in respect of each project to
compute project profitability. The two major components of contract estimate are ‘claims arising
during construction period’ and ‘budgeted costs to complete the contract’. While estimating these
components various assumptions are considered by the management such as (i) Work will be executed
in the manner expected so that the project is completed timely (ii) consumption norms will remain
same (iii) Wastage will not exceed the normal % as determined etc. (iv) Estimates for contingencies (v)
There will be no change in design and the geological factors will be same as communicated; and (vi)
Price escalations etc. Due to such complexities involved in the budgeting process, contract estimates
are highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting
date.

b. Recoverability of claims

The Company has claims in respect of cost over-run arising due to client caused delays, suspension
of projects, deviation in design and change in scope of work etc., which are at various stages of
negotiation/discussion with the clients or under arbitration. The realisability of these claims are
estimated based on contractual terms, historical experience with similar claims as well as legal opinion
obtained from internal and/or external experts, wherever necessary. Changes in facts of the case or
the legal framework may impact realisability of these claims.

c. Defined benefit plans

The cost and present value of the gratuity obligation and compensated absences are determined using
actuarial valuations. An actuarial valuation involves making various assumptions that may differ from
actual developments in the future. These include the determination of the discount rate, future salary
increases, attrition rate and mortality rates. Due to the complexities involved in the valuation and its
long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.

Property, Plant and Equipment

All items of property, plant and equipment are stated at acquisition cost net of accumulated depreciation
and accumulated impairment losses, if any. Historical cost includes expenditure that is directly attributable
to the acquisition of the items. The Company follows cost model for subsequent measurement for all classes
and items of property, plant and equipment. Subsequent costs are included in the carrying amount of asset
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. All
other repairs and maintenance expenses are charged to the Statement of Profit and Loss during the period
in which they are incurred. Gains or losses arising on retirement or disposal of assets are recognized in the
Profit or Loss. Spare parts, stand-by equipment and servicing equipment are recognized as property, plant
and equipment if they meet the definition of property, plant and equipment.

Depreciation on Tangible Fixed Assets is provided on Straight Line Method on the basis of useful life of assets
specified in Part C of Schedule II of the Companies Act, 2013. Property, plant and equipment which are
added / disposed off during the year, depreciation is provided on pro-rata basis with reference to the month
of addition / deletion. Gains and losses on disposals are determined by comparing the proceeds with the
carrying method.

The residual values are not more than 5% of the original cost of the asset. The residual values, useful lives
and method of depreciation of property, plant and equipment are reviewed at each Financial year end and
any changes there-in are considered as change in estimate and accounted prospectively.

Impairment of Assets:

Testing of impairment by the Management is predominantly based on the earning realization from construction
equipment’s, machinery, rollers & Trucks etc. under corona Virus Lockdown. PPE and intangible assets with
definite lives are reviewed for impairment, whenever events or changes in circumstances indicate that their
carrying values may not be recoverable. For the purpose of impairment testing, the recoverable amount
(that is, higher of the fair value less costs to sell and the value-in-use) is determined on an individual asset
basis, unless the asset does not generate cash flows that are largely independent of those from other assets,
in which case the recoverable amount is determined at the cash-generating-unit (‘CGU’) level to which the
said asset belongs. If such individual assets or CGU are considered to be impaired, the impairment to be
recognised in the statement of profit and loss is measured by the amount by which the carrying value of the
asset/CGU exceeds their estimated recoverable amount and allocated on pro rata basis.

Impairment losses, if any, are recognised in statement of profit and loss.

Depreciation and amortisation

Depreciation is provided for property, plant and equipment so as to expense the cost less residual value
over their estimated useful lives on a straight-line basis. The estimated useful lives are as mentioned

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Useful lives of asset classes determined by management estimate, which are generally higher than those
prescribed under Schedule II to the Act and are supported by the internal technical assessment of useful
lives.

The estimated useful life and residual values are reviewed at each financial year end and the effect of any
change in the estimates of useful life/residual value is accounted on prospective basis. An asset’s carrying
amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than
its estimated recoverable amount. Depreciation on additions is provided on a pro-rata basis, from the date
on which asset is ready to use. Gains and losses on disposals are determined by comparing proceeds with
carrying amount. These are accounted in the Statement of Profit and Loss under Other income and other
expenses.

Inventories

Inventories are carried in the balance sheet as follows:

(a) Raw materials, components, stores and spares

Raw materials, components, stores and spares are valued at lower of cost or net realisable value. Cost is
determined on a FIFO basis and comprises the purchase price including duties and taxes (other than those
subsequently recoverable by the Company from the taxing authorities). Net realisable value is the estimated
selling price in the ordinary course of business, less than estimated cost necessary to make the sale.

(b) Contract Work-in-progress

Costs incurred that relate to future activities on the contract are recognised as contract work-in-progress.
Contract work-in progress comprises of construction cost and other directly attributable overhead valued at
cost.

The cost of inventories including unawarded claims have been computed to include all cost of purchases,
cost of conversion and other related costs incurred in bringing the inventories to their present location and
condition. Goods and materials in transit are valued at actual cost incurred upto the date of Balance Sheet.

Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with
an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

Statement of Cash Flows

Cash Flows are reported using the “indirect method”, whereby Loss for the period is adjusted for the effects of
transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments
and item of income or expenses associated with investing or Financing cash Flows. The cash Flows from operating,
investing and financing activities of the Company are segregated.

Sundry Debtors / Loans and Advances:

Sundry Debtors including awarded claims / Loans and Advances are stated net of provision for identified doubtful
debts/advances wherever necessary. Sundry Debtors and Loans and Advances has been taken at reconciled amount
for the parties from which the balance confirmation was received and for the rest Debtors and balances are taken
as per book balance and are subject to adjustment and reconciliation, if any which will be done on receipts of
confirmation from such parties. In the opinion of the management on which we have placed reliance, substantial
part of debtors are outstanding for a period exceeding six months and they are subject to arbitration and other
reconciliatory proceedings, the outcome and quantum of which is not ascertainable and determined; subject to
reconciliations referred to above, the debtors and Loans and advances to the extent as stated are considered good
in the Balance Sheet.

Investments:

The Investments that are readily realizable and intended to be held for not more than a year from the Balance
Sheet date are classified as current investments. All other investments are classified as non-current investments

On initial recognition, all investments are recognized at cost. The cost comprises purchase price and directly
attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried at the lower of cost and quoted/fair value, computed category wise. Long term
investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such
a decline is other than temporary in the opinion of the management.

Revenue Recognition:

Contract Revenue

The Company follows the percentage completion method, based on the stage of completion at the Balance Sheet
date, taking into account the contractual price and revision thereto by estimating total revenue including claims/
variations, Construction Contracts, and total cost till completion of the contract and the profit so determined
proportionate to the percentage1.7d by Company and are based on technical and other estimates and experience
gain.

The Company’s claim for extra work and escalation in rates relating to execution of contracts are accounted as
income in the year of receipt of arbitration award or acceptance by client or evidence of acceptance received.

Contract Receipts - Sub-Contract Revenue

Proportionate Consolidation method of accounting and reporting is followed in respect of Joint venture entered
into by the Company. The Income from such joint venture is recognized proportionately, in the profit sharing ratio,
and on the basis of Bills submitted, certified and sanctioned by the appropriate authorities. The actual expenses
for such Project in Joint Venture are also accounted on the basis of the Profit sharing ratio for the consolidation
purposes.

Accounting for Claims

Amounts recoverable in respect of the price and other escalation, bonus claims adjudication and variation in
contract work required for performance of the contract to the extent that it is probable that they will result
in revenue. The same is unbilled and is accounted as work in progress and in debtors for which arbitration
proceedings are initiated.

Other Income

a. Interest income is recognized on a time proportion basis, by reference to the principal outstanding and the
applicable Effective Interest Rate (EIR).

Other items of income are accounted as and when right to receive such income arises and it is probable that the
economic benefits wil flow to the Company and the amount of income can be measured reliably.

Post-Employment Benefits

The company operates the following post-employment schemes:

(a) Defined benefit plans and

(b) Defined contribution plans

Defined benefit plans - Gratuity obligations

The liability or asset recognised in the balance sheet in respect of defined benefit pension and gratuity plans is
the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan
assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have terms
approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit
obligation and the fair value of plan assets.

This cost is included in employee benefit expense in the statement of profit and loss. Measurement gains and
losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period
in which they occur, directly in other comprehensive income. They are included in retained earnings in the
statement of changes in equity and in the balance sheet.

Defined contribution plans - Provident fund

The company pays provident fund contributions to publicly administered provident funds as per local regulations.
The company has no further payment obligations once the contributions have been paid. The contributions are
accounted for as defined contribution plans and the contributions are recognised as employee benefit expense
when they are due.

Short-term Benefits

Short-term employee benefits such as salaries, wages, performance incentives etc. are recognised as expenses
at the undiscounted amounts in the Statement of Profit and Loss of the period in which the related service is
rendered.

Earnings per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity
shareholders by the weighted average number of equity shares outstanding during the year. The weighted average
number of equity shares outstanding during the year is adjusted for events, such as bonus shares, other than the
conversion of potential equity shares, that have changed the number of equity shares outstanding, without a
corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to
equity shareholders of the Company and the weighted average number of shares outstanding for deriving basic
earnings per equity share and also the weighted average number of equity shares that could have been issued
upon conversion of all dilutive potential equity shares. The dilutive potential equity shares are adjusted for the
proceeds receivable had the equity shares been actually issued at fair value (i.e. the average market value of the
outstanding equity shares).

Income Taxes

Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during
the period. Current and deferred taxes are recognised in the statement of profit and loss, except when they relate
to items that are recognised in other comprehensive income or directly in equity, in which case, the current and
deferred tax are also recognised in other comprehensive income or directly in equity, respectively.

Current tax

Current income tax is recognised based on the estimated tax liability computed after taking credit for allowances
and exemptions in accordance with the Income Tax Act, 1961. 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.

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 determined by applying the balance sheet approach. Deferred tax assets and liabilities are
recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax
losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax
losses can be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised
to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be
recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year
when the asset is realised or the liability is settled, based on tax rates (and tax laws) that at the reporting date.

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, 2016

Notes :

1. The above Cash Flow Statement has been prepared under the ‘Indirect Method’ as set out in Accounting Standard - 3 on “Cash Flow Statements” prescribed by the Companies (Accounting Standard) Rules, 2006.

2. Previous year’s figures have been regrouped/rearranged wherever necessary to conform to the current year’s presentation.

Note:

1 Company has not issued nor bought back any share during the last five years

2 None of shareholder(s) of Company is it’s holding company, ultimate holding company, subsidiaries, associates of the holding company or associates of the ultimate holding company for current year and/or previous year.

3 There are no unpaid call from any director or officers of the company for current and previous year Terms / Rights attached to equity shares:

1 Voting

The Company has only one class of equity shares having a par value of '' 10/- per share. Each holder of equity shares is entitled to one vote per share.

2 Liquidation

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive all of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders

3 Dividends

The Board of Directors do not propose dividend for financial year 2015-16.

Terms & Security:

(1) Term Loan - From Bank

a) Rs, 77.64 lakhs is in the nature of machinery/equipment finance secured by hypothecation of respective machinery/equipment

b) Rs, 8070.72 lacs under CDR and governed by Master Restructuring Agreement(MRA) with Canara bank, Union Bank of India, State Bank of Patiala, The Karur Vysya Bank Ltd, & Punjab and Sind Bank. The amount repayable is over a period from FY 2017-18 to 2021-22. This loan is secured by equitable mortgage of immovable property of the Company and promoters, pari-passu charge on plant & machinery of the company (excluding land & office flat & equipments on which other lenders are having first charge) and irrevocable and unconditional personal guarantees of the Directors and pledge of shares held by promoters in the Company. There is failure in compliance of MRA conditions and company under negotiation with bank for lump sum settlement. However interest is provided at 14% to 16% p.a.

c) Balance term loan amounting to Rs,9.70 lakhs from the banks together with interest and other charges thereon, are secured by first pari-pasu charge on the fixed assets of the Company and second (collateral) pari-pasu charge on the current assets of the Company, both present and future, and by way of pledge of shares of the promoters and irrevocable and unconditional personal guarantees of the Directors.

d) In relation to CDR under MRA, during the subsistence of this MRA, if lender/monitoring committee is of opinion that the security provided by Company has become inadequate to cover balance of loan, the Company shall provide additional security to cover such deficiency. In case of delay in providing such additional security, Company shall be liable to pay additional interest @ 2% p.a. for delay period.

e) Interest rate for all term loan are subject to periodic review.

(2) Term Loan - Others

a) Rs, 1244.46 lakhs are in the nature of machinery / equipment finance secured by respective machinery/ equipments.

Note : A-4

Deferred tax liabilities (Net)

As required by Accounting Standard 22 “ Accounting for Taxes on Income” issued by the Institute of Chartered

Accountants Of India, which is mandatory in nature, the Company has recognized Deferred taxes which is result from the timing difference between the Book Profits and Tax Profits. As a result the deferred tax assets for the year aggregating Rs,4.32 lakhs has been recognized in the Profit and Loss Account.

Disclosure of information u/s 22 of The Micro, Small and Medium Enterprises Development Act, 2006

1. In absence of complete information from the vendors with regards to their registration (filling of Memorandum) under The Micro, Small and Medium Enterprises Development Act, 2006. (27 of 2006 ), the Company is unable to compile the full information required to be disclosed herein under section 22 of the said Act.

Disclosure as per Accounting Standards AS 15

1 Defined Contribution plan : Company contribution to Provident Fund is charged to the profit and loss account of the year when the contributions to the respective fund are due.

2 Defined Benefit Plan : Gratuity liabilities are provided for based on actuarial valuation. The Actuarial valuation is done on Projected Unit Credit method.

Actuarial gains or losses are recognized immediately in the statements of the profit and loss account as income or expense.

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Mar 31, 2015

A. Corporate Information

M/s. PBA Infrastructure Limited (the company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956 read with Companies Act 2013. Its shares are listed on two stock exchanges in India wise BSE and NSE. The Company is engaged in execution of contracts of various infrastructure projects including road work, bridge work and irrigation projects.

b. Basis of Preparation/Accounting of Financial Statement:

The financial statement have been prepared under the historical cost convention and on an accrual basis of accounting and in accordance with the generally accepted accounting principles in India (Indian GAAP) including the Accounting Standards as prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified). Except otherwise mentioned, the accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

c. Financial Statements: Presentation and Disclosures:

Financial Statements contain the information and disclosures mandated by Revised Schedule VI, applicable Accounting Standards, other applicable pronouncements and regulations.

d. Use of Estimate:

The preparation and presentation of financial statements requires estimates and assumptions to be made, that affect the reported amount of assets and liabilities and disclosures of contingent liabilities as on date of the financial statements and reported amount of revenue and expenses during 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 adjustment to the carrying amounts of assets and liabilities in future periods.

Difference between the actual results and estimates is recognized in the period in which the actual results are known / materialized.

e. Fixed Assets and Depreciation :

i. All the fixed assets purchased are stated at cost of acquisition or construction of assets, net of recoverable taxes, except in case of those assets which are revalued, less accumulated depreciation or impairment loss thereof if any. The cost includes borrowing costs, exchange differences arising in respect of foreign currency loans or other liabilities incurred, expenses incidental to acquisition and installation, attributable to bringing the assets to their intended use.

ii. Fixed assets retired from active use and held for sale are stated at the lower of their net book value and net realizable value and are disclosed separately in the Balance Sheet.

iii. The Company do not have Intangible Assets and Capital Work In Progress for the period.

iv. Depreciation on fixed assets is provided on "Straight line Method", at the rates arrived as per useful life as mentioned in Fixed Assets Schedule, from 1st April 2014 (for assets existing on 01/04/2014) and from date of put to use for other assets after considering Residual Value five percent, which is based on internal assessment and independent technical evaluation carried out by technical expert and the management believes that the useful lives as given above best represent the period.

v. Depreciation on revalued assets is provided at the rate as above or rate derived as per its estimated useful life, whichever is higher.

vi. Depreciation on fixed assets added/disposed off during the year is provided on pro rata basis with reference to the date of addition/disposal.

vii. In case of impairment, if any, depreciation is provided on the revised carrying amount of the assets over the remaining useful life.

f. Sundry Debtors / Loans and Advances:

Sundry Debtors / Loans and Advances are stated net of provision for identified doubtful debts / advances wherever necessary. Sundry Debtors and Loans and Advances has been taken at reconciled amount for the parties from which the balance confirmation was received and for the rest Debtors and balances are taken as per book balance and are subject to adjustment and reconciliation, if any which will be done on receipts of confirmation from such parties. In the opinion of the management on which we have placed reliance, substantial part of debtors are outstanding for a period exceeding six months and they are subject to arbitration and other reconciliatory proceedings, the outcome and quantum of which is not ascertainable and determined; subject to reconciliations referred to above, the debtors and Loans and advances to the extent as stated are considered good in the Balance Sheet.

g. Investments:

The Investments that are readily realizable and intended to be held for not more than a year from the Balance Sheet date are classified as current investments. All other investments are classified as non-current investments.

On initial recognition, all investments are recognized at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried at the lower of cost and quoted/fair value, computed category wise. Long term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

h. Cash and cash equivalents:

Cash and cash equivalents in the cash flow statements comprise Cash at bank and cash on hand and short term investments with an original maturity of three months or less.

i. Derivative Instruments:

As per the ICAI announcement, derivative contracts, other than those covered under AS - 11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effects on the underlying hedge item, is charged to the income statement.

j. Foreign Currency Transactions:

a) Initial currency transaction:

Foreign exchanges are recorded in the reporting currency by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

b) Conversion:

Foreign currency monetary items are reported using closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the value were determined.

c) Exchange Difference:

Exchange difference arising on the settlement /conversion of monetary items is recognized as income or expenses in the year in which they arise.

k. Revenue Recognition:

Contract Receipt

In respect of Construction contracts and in manner specified under Accounting Standard AS-7 on Construction Contracts, Revenue is recognized on Stage of Completion Method based on the Bills submitted, certified and sanctioned by the appropriate authorities and Work completed and Uncertified Bills on the Project. The relevant cost is recognized in accounts in the year of recognition of the revenue.

The total costs of contract are estimated by Company and are based on technical and other estimates and experience gain.

Profit is recognized only when the outcome of the contract can be estimated reliably. When the construction contract is expected to result in a loss on completion of the entire contract, the entire loss is recognized as an expense immediately in the same reporting period.

The Company's claim for extra work and escalation in rates relating to execution of contracts are accounted as income in the year of receipt of arbitration award or acceptance by client or evidence of acceptance received.

Other Income

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

Dividend income recognized as and when right to receive established.

All other income is recognized on accrual basis.

l. Contract Receipts - Joint venture:

Proportionate Consolidation method of accounting and reporting is followed in respect of Joint venture entered into by the Company. The Income from such joint venture is recognized proportionately, in the profit sharing ratio, and on the basis of Bills submitted, certified and sanctioned by the appropriate authorities. The actual expenses for such Project in Joint Venture are also accounted on the basis of the Profit sharing ratio for the consolidation purposes

m. Valuation of work in progress:

i. The work in progress has been determined by the Management at the estimated realizable value.

ii. The value of work in progress comprises of value of materials and expenses incurred at site including estimated profits thereon in terms of guidelines provided under Accounting Standards AS 7 on Construction Contracts.

n. Borrowing costs:

Borrowing costs are accounted on accrual basis. Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

o. Taxation:

a. Tax expenses compromise of current tax & deferred tax. 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. Deferred Income Taxes reflect the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier year.

b. The deferred tax is accounted for using the tax rates and laws that have been substantively enacted as on the Balance sheet date.

p. Impairment of Assets:

As at each balance sheet date, the carrying amount of assets is tested for impairment so as to determine:

* The provision for impairment loss required, if any, or

* The reversal required of impairment loss recognized in previous periods, if any,

Impairment loss is recognized when the carrying amount of asset exceeds its recoverable amount.

Recoverable amount is determined:

* In the case of an individual asset, at higher of net selling price and the value in use.

q. Retirement Benefits:

i. Contribution to defined contribution plans such as retirement benefit in the form of Provident Fund Schemes whether in pursuance of law or otherwise is accounted on accrual basis and charged to Profit and loss account of the year.

ii. Defined benefit plans like gratuity are determined based on actuarial valuation carried out by an independent actuary at the balance sheet date using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit, and measures each unit separately to build up final obligation.

iii. In relation to short term employees benefits cost of accumulated compensated absences accounted when employees render the services that increase their entitlement of future compensated absences; and cost of non-accumulating compensated absences, when the absences occur.

iv. No separate provision has been made in respect of leave encashment as the same is paid to employees as and when it is claimed.

r. Overdue Charges in Respect of Loans:

Overdue charges if any levied by Financial Institutions / Banks / NBFC are not considered during the currency of the loan. The same is considered as a financial expense in the year of final settlement of loan amount.

s. Provisions:

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

i. The company has a present obligation as a result of past event

ii. A probable outflow of resources is expected to settle the obligation; and

iii. The amount of obligation can be reliably estimated Provisions made in terms of Accounting Standards 29 are not discounted to its present value and are determined based on the management estimates required to settle the obligation at the balance sheet date.

t. The cash flow statement is prepared in the manner set out in Accounting Standards 3. Cash and Cash equivalents presented in the cash flow statement consist of cash on hand and balance with bank including bank deposits having maturity period within three months.

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Mar 31, 2012

A. Basis of Preparation/Accounting of Financial Statement:

The financial statement have been prepared under the historical cost convention and on an accrual basis of accounting and in accordance with the generally accepted accounting principles in India (Indian GAAP) and comply in all material aspect with the Notified Accounting Standards stated in Companies Accounting Standards Rule, 2006 (as amended) and the relevant provision of the Companies Act,1956. Except otherwise mentioned, the accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

b. Financial Statements: Presentation and Disclosures: During the year ended March 31, 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.

Financial Statements contain the information and disclosures mandated by Revised Schedule VI, applicable Accounting Standards, other applicable pronouncements and regulations.

c. Use of Estimate:

The preparation and presentation of financial statements requires estimates and assumptions to be made, that affect the reported amount of assets and liabilities and disclosures of contingent liabilities as on date of the financial statements and reported amount of revenue and expenses during 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 adjustment to the carrying amounts of assets and liabilities in future periods. Difference between the actual results and estimates is recognised in the period in which the actual results are known / materialized.

d. Fixed Assets and Depreciation :

i. All the fixed assets purchased are stated at cost of acquisition or construction of assets, net of recoverable taxes, except in case of those assets which are revalued, less accumulated depreciation or impairment loss thereof if any. The cost includes borrowing costs, exchange differences arising in respect of foreign currency loans or other liabilities incurred, expenses incidental to acquisition and installation, attributable to bringing the assets to their intended use.

ii. Fixed assets retired from active use and held for sale are stated at the lower of their net book value and net realisable value and are disclosed separately in the Balance Sheet.

iii. The Company do not have Intangible Assets and Capital Work In Progress for the period.

iv. Depreciation on fixed assets is provided on "Straight line Method", at the rates and the manner as prescribed by Schedule XIV to the Companies Act, 1956.

v. Depreciation on revalued assets is provided at the rate specified u/s-205(2) (b) of the Companies Act, 1956 or rate derived as per its estimated useful life, whichever is higher.

vi. Depreciation on fixed assets added/disposed off during the year is provided on prorata basis with reference to the date of addition/disposal.

vii. In case of impairment, if any, depreciation is provided on the revised carrying amount of the assets over the remaining useful life.

e. Sundry Debtors / Loans and Advances:

Sundry Debtors / Loans and Advances are stated net of provision for identified doubtful debts/advances. Sundry Debtors and Loans and Advances has been taken at the reconciled amount for the parties from which the balance confirmation was received and for the rest balances are taken as per book balance.

As and when the confirmations with respect to the balances will be received the reconciliations will be done and the adjustments, if any, on this account will be made. In the opinion of the management, subject to reconciliations referred above, the debts and Loans and Advances to the extent as stated are considered good in the Balance Sheet are fully recoverable.

f. Investments:

The Investments that are readily realizable and intended to be held for not more than a year from the Balance Sheet date are classified as current investments. All other investments are classified as non-current investments.

On initial recognition, all investments are recognised at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried at the lower of cost and quoted/fair value, computed category wise. Long term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

g. Cash and cash equivalents

Cash and cash equivalents in the cash flow statements comprise Cash at bank and cash in hand and short term investments with an original maturity of three months or less

h. Derivative Instruments:

As per the ICAI announcement, derivative contracts, other than those covered under AS - 11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effects on the underlying hedge item, is charged to the income statement.

i. Foreign Currency Transactions:

a) Initial currency transaction

Foreign exchanges are recorded in the reporting currency by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

b) Conversion:

Foreign currency monetary items are reported using closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the value were determined.

c) Exchange Difference:

Exchange difference arising on the settlement /conversion of monetary items is recognized as income or expenses in the year in which they arise.

Revenue Recognition:

Contract Receipt

In respect of Construction contracts and in manner specified under Accounting Standard AS-7 on Construction Contracts, Revenue is recognized on Percentage completion method based on the Bills submitted, certified and sanctioned by the appropriate authorities and Work completed and Uncertified Bills on the Project. The relevant cost is recognized in accounts in the year of recognition of the revenue.

The total costs of contract are estimated by Company and are based on technical and other estimates, this being a Technical subject, the auditors have relied on such assumptions.

Profit is recognised only when the outcome of the contract can be estimated reliably. When the construction contract is expected to result in a loss on completion of the entire contract, the entire loss is recognized as an expense immediately in the same reporting period.

The Company's claim for extra work and escalation in rates relating to execution of contracts are accounted as income in the year of receipt of arbitration award or acceptance by client or evidence of acceptance received.

Other Income

Profit on sale of investment is recognized on transfer of title from the company and is determined as the difference between the sale price and carrying value of the Investment.

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. Machinery Hire Charges is recognized on accrual basis.

k. Contract Receipts - Joint venture:

Proportionate Consolidation method of accounting and reporting is followed in respect of Joint venture entered into by the Company. The Income from such joint venture is recognized proportionately on the basis of Bills submitted, certified and sanctioned by the appropriate authorities. The actual expenses for such Project in Joint Venture are accounted on the basis of the Profit sharing ratio.

l. Valuation of work in progress:

i. The work in progress has been determined by the Management at the estimated realizable value.

ii. The value of work in progress comprises of value of materials and expenses incurred at site including estimated profits thereon in terms of guidelines provided under Accounting Standards AS 7 on Construction Contracts.

m. Borrowing costs:

Borrowing costs are accounted on accrual basis. Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

n. Taxation:

a. Tax expenses compromise of current tax & deferred tax. 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. Deferred Income Taxes reflect the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier year.

b. The deferred tax is accounted for using the tax rates and laws that have been substantively enacted as on the Balance sheet date.

o. Impairment of Assets :

As at each balance sheet date, the carrying amount of assets is tested for impairment so as to determine:

¦ The provision for impairment loss required, if any, or

¦ The reversal required of impairment loss recognised in previous periods, if any, Impairment loss is recognised when the carrying amount of asset exceeds its recoverable amount. Recoverable amount is determined:

In the case of an individual asset, at higher of net selling price and the value in use.

p. Retirement Benefits :

I. Contribution to defined contribution plans such as retirement benefit in the form of Provident Fund Schemes whether in pursuance of law or otherwise is accounted on accrual basis and charged to Profit and loss account of the year.

ii. Defined benefit plans like gratuity are determined based on actuarial valuation carried out by an independent actuary at the balance sheet date using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit, and measures each unit separately to build up final obligation.

iii. In relation to short term employees benefits cost of accumulated compensated absences accounted when employees render the services that increase their entitlement of future compensated absences; and cost of non- accumulating compensated absences, when the absences occur.

iv. No separate provision has been made in respect of leave encashment as the same is paid to employees as and when it is claimed.

q. Provisions:

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

i. The company has a present obligation as a result of past event

ii. A probable outflow of resources is expected to settle the obligation; and

iii. The amount of obligation can be reliably estimated Provisions made in terms of accounting Standard 29 are not discounted to its present value and are determined based on the management estimates required to settle the obligation at the balance sheet date.

r. The cash flow statement is prepared in the manner set out in Accounting Standards 3. Cash and Cash equivalents presented in the cash flow statement consists of cash on hand and balances with bank including bank deposits having maturity period within three months.

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Mar 31, 2010

A. Basis of accounting: The financial statement have been prepared to comply in all material aspects with the Notified Accounting Standards stated in Companies Accounting Standards Rule,2006 (as amended) and the relevant provision of the Companies Act,1956. Except otherwise mentioned, the accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

b. FixedAssets and Depreciation :

i. All the fixed assets purchased are stated at cost of acquisition except in case of those assets which are revalued.

ii. Depreciation on fixed assets is provided on "Straight line Method", at the rates prescribed by Schedule XIV to the CompaniesAct, 1956.

iii. Depreciation on revalued assets is provided at the rate specified u/s-205(2) (b) of the Companies Act, 1956 or estimated useful life, whichever is higher.

iv. Depreciation on fixed assets added/disposed off during the year is provided on prorata basis with reference to the date of addition/disposal.

v. In case of impairment, if any, depreciation is provided on the revised carrying amount of the assets over the remaining useful life.

c. Sundry Debtors / Loans and Advances: Sundry Debtors / Loans and Advances are stated net of provision for identified doubtful debts/advances. Sundry Debtors and Loans and Advances has been taken at the reconciled amount for the parties from which the balance confirmation was received and for the rest balances are taken as per book balance. As and when the confirmations with respect to the balances will be received the reconciliations will be done and the adjustments, if any, on this account will be made. In the opinion of the management, subject to reconciliations referred above, the debts and Loans and advances to the extent as stated are considered good inthe Balance Sheet are fully recoverable.

d. Investments: The Investments that are readily realizable and intended to be held for not more than a year are classified as current investments.All other investments are classified as other investments

e. Cash and cash equivalents: Cash and cash equivalents in the cash flow statements comprise Cash at bank and cash in hand and short term investments with an original maturity of three months or less

f. Derivative Instruments: As per the ICAI announcement, derivative contracts, other than those covered under AS – 11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effects on the underlying hedge item, is charged to the income statement.

g. Foreign CurrencyTransactions:

a) Initial currency transaction: Foreign exchanges are recorded in the reporting currency by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the dateof the transaction.

b) Conversion: Foreign currency monetary items are reported using closing rate. Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the value were determined.

c) Exchange Difference: Exchange difference arising on the settlement /conversion of monetary items is recognized as income or expensesinthe year in which they arise.

h. Revenue Recognition:

i) In respect of Construction contracts and in manner specified under Accounting Standards AS-7 on Construction Contracts, Revenue is recognized on Percentage completion method based on the Bills submitted, certified and sanctioned by the appropriate authorities. The relevant cost is recognized in accounts in the year of recognition of the revenue.

ii) The total costs of contract are estimated by the Company and are based on technical and other estimates. The auditors have relied on such assumptions.

i. Contract Receipts - Joint venture: Proportionate Consolidation method of accounting and reporting is followed in respect of Joint venture entered into by the Company. The Income from such joint venture is recognized proportionately on the basis of Bills submitted, certified and sanctioned by the appropriate authorities. The actual expenses for such Project in Joint Venture are accounted on the basis of the Profit sharing ratio.

j. Valuation of work in progress:

i) The work in progress has been determined by the Management at the estimated realizable value.

ii) The value of work in progress comprises of value of material and expenses incurred at site including estimated profits thereon in terms of guidelines provided under Accounting Standards AS 7 on Construction Contracts.

k. Borrowing costs: Borrowing costs are accounted on accrual basis. Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

l. Taxation: a. Tax expenses compromise of current & deferred tax. 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. Deferred Income Taxes reflect the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier year. b. The deferred tax is accounted for using the tax rates and laws that have been substantively enacted as of the Balance sheet date.

m. Impairment of Assets : As at each balance sheet date, the carrying amount of assets is tested for impairment so as to determine:

- The provision for impairment loss required, if any, or

- The reversal required of impairment loss recognised in previous periods, if any, Impairment loss is recognised when the carrying amount of asset exceeds its recoverable amount.

Recoverable amount is determined:

- In the case of an individual asset, at higher of net selling price and the value in use.

n. Retirement Benefits:

i) The retirement benefit in the form of Provident Fund and Pension Schemes whether in pursuance of any law or otherwise is accounted on accrual basis and charged to profit and loss account of the year.

ii) Gratuity in respect of past and present services of employees is being accounted for on accrual basis based on actuarial valuation. iii) No separate provision has been made in respect of leave encashment as the same is paid to the employee as and when it is claimed.

o. Provisions: Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

i. The company has a present obligation as a result of past event

ii. A probable outflow of resources is expected to settle the obligation; and

iii. The amount of obligation can be reliably estimated Provisions made in terms of Accounting Standard 29 are not discounted to its present value and are determined based on the management estimates required to settle the obligation at the balance sheet date.

p. The cash flow statement is prepared in the manner set out in Accounting Standards 3. Cash and cash equivalents presented in the cash flow statement consists of cash on hand and balances with banks.