Accounting Policies of Purohit Construction Ltd. Company

Mar 31, 2024

NOTE - 1 - MATERIAL ACCOUNTING POLICIES:

This note provides a list of the significant accounting policies adopted in the preparation of these
standalone financial statements. These policies have been consistently applied to all the years presented,
unless otherwise stated.

(a) Basis of preparation

(i) Compliance with Ind AS

The financial statements of the Company comply in all material aspects with Indian Accounting
Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) read with
Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015 and other relevant
provisions of the Act.

(ii) Historical cost convention

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

¦ Certain financial assets and financial liabilities

¦ Defined benefit plans

(b) 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.

(c) Critical estimates and judgements

The preparation of financial statements in conformity with Ind AS requires judgements,estimates
and assumptions to be made that affect the reported amount of assets, liabilities, revenue,
expenses, accompanying disclosures and the disclosures of contingent liabilities. The estimates
and associates assumptions are based on historical experience and other factors that are considered
to be relevant. Actual results could differ from those estimates. These estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimates is revised if the revision affects only that period, or in the period
of the revision and future periods if the revision affects both current and future period.

Application of accounting policies that require critical accounting estimates and the use of
assumptions in the financial statements are as follows:

i) Estimation of current tax expense and deferred tax

The calculation of the Company''s tax charge necessarily involves a degree of estimation and
judgement in respect of certain items whose tax treatment cannot be finally determined until
resolution has been reached with the relevant tax authority or, as appropriate, through a
formal legal process. The final resolution of some of these items may give rise to material
profits/losses and/or cash flows.

ii) Recognition of deferred tax assets/ liabilities

The recognition of deferred tax assets/ liabilities is based upon whether it is more likely than
not that sufficient and suitable taxable profits will be available in the future against which the
reversal of temporary differences can be deducted. To determine the future taxable profits,
the management considers the nature of the deferred tax assets, recent operating results,
future market growth, forecasted earnings and future taxable income in the jurisdictions in
which we operate and prudent and feasible tax planning strategies.

iii) Estimation of Provisions & Contingent Liabilities.

The Company exercises judgement in measuring and recognising provisions and the
exposures to contingent liabilities which is related to pending litigation or other outstanding
claims. If a loss arising from these litigations and/or claims is probable and can be
reasonably estimated, the management record the amount of the estimated loss. If a loss
is reasonably possible, but not probable, the management discloses the nature of the
significant contingency and, if quantifiable, the possible loss that could result from the
resolution of the matter. As additional information becomes available, the management
reassess any potential liability related to these litigations and claims and may need to revise
the estimates. Such revisions or ultimate resolution of these matters could materially impact
the results of operations, cash flows or financial statements of the company.

iv) Estimated Useful Life of Property, Plant and Equipment

The charge in respect of periodic depreciation on Property, Plant and Equipment is derived
after determining an estimate of an asset''s expected useful life and the expected residual
value at the end of its life. The Useful Lives and residual values of Company''s Property, Plant
and Equipment are determined by the Management at the time the asset is acquired and
reviewed periodically, including at each financial year end. The lives are based on historical
experience with similar assets as well as anticipation of future events, which may impact
their life, such as changes in technology.

v) 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.

(d) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker (CODM). The Managing Director of the Company has been identified
as CODM and he assesses the financial performance and position of the Company, and makes
strategic decisions.

(e) Revenue recognition

Revenue from contracts with customers is recognized when control of the goods or services are
transferred to the customer at an amount that reflects the consideration entitled in exchange for
those goods or services.

Amounts disclosed as revenue is net of goods and service tax and amounts collected on behalf
of third parties.

The company recognises revenue when the amount of revenue can be reliably measured, it is
probable that future economic benefits will flow to the entity and specific criteria have been met
for each of the company''s activities as described below.

(i) In case of construction contracts or part thereof completed during the year, revenue is
recognized based on the work bills raised on the principals of such projects.

(ii) In respect of the construction contracts on hand, company recognizes revenue at the year-
end on the basis of “Percentage of work completion” method based on the amounts admitted
by principals or certified by the Architect till the year end in accordance with the agreements
entered into with the principal.

(f) Income tax

The tax expenses for the period comprises of current tax and deferred income tax. Tax is recognised
in profit or loss, except to the extent that it relates to items recognised in other comprehensive
income or directly in equity. In which case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.

(i) Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or
substantively enacted at the end of the reporting period. The provision for current tax is made
at the rate of tax as applicable for the income of the previous year as defined under the
Income tax Act, 1961.

Current tax assets and tax liabilities are offset where the entity has a legally enforceable right
to offset and intends either to settle on a net basis, or to realize the asset and settle the
liability simultaneously.

(ii) Deferred tax

Deferred tax is recognised using the Balance Sheet approach on temporary differences at
the reporting date arising between the tax bases of assets and liabilities and their carrying
amounts as per financial statements as at the reporting date.

Deferred income tax is determined using tax rates (and laws) that have been enacted or
substantially enacted by the end of the reporting period and are expected to apply when the
related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognized to the extent that it is probable that future taxable income
will be available against which the deductible temporary differences, unused tax losses,
depreciation carry- forwards and unused tax credits could be utilized.

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

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets and liabilities and when the deferred tax balances relate to the same
taxation authority.

(g) Impairment of non-financial assets

Assets are tested for impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. An impairment loss is recognised for the amount by which
the asset''s carrying amount exceeds its recoverable amount. The recoverable amount is the higher
of an asset''s fair value less costs of disposal and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from other assets or groups of assets
(cash-generating units). Non-financial assets that suffered an impairment are reviewed for possible
reversal of the impairment at the end of each reporting period.

(h) Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes
cash on hand, deposits held at call with financial institutions, other short-term, highly liquid

investments with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value, and bank
overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

(i) Inventories

Inventories are stated at lower of cost and net realizable value.

Cost of raw material includes cost of purchases and other cost incurred in bringing the inventories
to the present location and condition.

Net realisable value is the estimated selling price in the ordinary course of business, less the
estimated costs of completion and the estimated costs necessary to complete the contract

(j) Financial instruments

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

Initial recognition and measurement

Financial assets and liabilities are recognised when the Company becomes a party to the contractual
provisions of the instrument. Financial assets and financial liabilities are initially measured at fair
value. Transaction costs that are directly attributable to the acquisition or issue of financial assets
and financial liabilities (other than financial assets and financial liabilities at fair value through profit
or loss) are added to or deducted from the fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of
financial assets or financial liabilities at fair value through profit or loss are recognized immediately
in profit or loss.

(i) Financial Assets:

Classification

The Company classifies its financial assets in the following measurement categories:

¦ those to be measured subsequently at fair value (either through other comprehensive
income, or through the Statement of Profit or Loss), and

¦ those measured at amortized cost.

The classification depends on the entity''s business model for managing the financial assets
and the contractual terms of the cash flows.

Subsequent measurement

After initial recognition, financial assets are measured at:

¦ fair value (either through other comprehensive income or through profit or loss), or

¦ amortized cost

Debt instruments

Debt instruments are subsequently measured at amortized cost, fair value through other
comprehensive income (''FVOCI'') or fair value through profit or loss (''FVTPL'') till de-recognition
on the basis of (i) the entity''s business model for managing the financial assets and (ii) the
contractual cash flow characteristics of the financial asset.

(i) Amortised Cost:

Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest are measured at amortised cost.
A gain or loss on a debt investment that is subsequently measured at amortised cost
is recognised in the Statement of Profit and Loss when the asset is derecognised or
impaired. Interest income from these financial assets is included in other income
using the effective interest rate method.

(ii) Fair Value Through Other Comprehensive Income (FVOCI):

Assets that are held for collection of contractual cash flows and for selling the financial
assets, where the assets'' cash flows represent solely payments of principal and
interest, are measured at FVOCI. Movements in the carrying amount are taken through
OCI, except for the recognition of impairment gains or losses, interest revenue and
foreign exchange gains and losses which are recognised in the Statement of Profit and
Loss. When the financial asset is derecognised, the cumulative gain or loss previously
recognised in OCI is reclassified from equity to profit or loss and recognised in other
gains/ (losses). Interest income from these financial assets is included in other
income using the effective interest rate method.

(iii) Fair Value Through Profit or Loss (FVTPL):

Assets that do not meet the criteria for amortised cost or FVOCI are measured at
FVTPL. A gain or loss on a debt investment that is subsequently measured at fair value
through profit or loss is recognised in profit or loss in the period in which it arises.
Interest income from these financial assets are recognised in the Statement of profit
and loss.

Equity instruments

All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments
which are held for trading are classified as at FVTPL. For all other equity instruments, the
Company decides to classify the same either as at fair value through other comprehensive
income (FVTOCI) or FVTPL.

The Company makes such election on an instrument-by-instrument basis. The classification
is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends, are recognized in other comprehensive
income (OCI). There is no recycling of the amounts from OCI to Statement of Profit and Loss,
even on sale of such investments.

Equity instruments included within the FVTPL category are measured at fair value with all
changes recognized in the Statement of Profit and Loss.

Impairment of Financial Assets

In accordance with Ind AS 109, the Company applies the expected credit loss (''ECL'') model
for measurement and recognition of impairment loss on financial assets and credit risk
exposures. ECL is the difference between all contractual cash flows that are due to the
Company in accordance with the contract and all the cash flows that the entity expects to
receive (i.e., all cash shortfalls), discounted at the original EIR. Lifetime ECL are the expected
credit losses resulting from all possible default events over the expected life of a financial
instrument. The 12- month ECL is a portion of the lifetime ECL which results from default
events that are possible within 12 months after the reporting date.

The Company follows ''simplified approach'' for recognition of impairment loss allowance on
trade receivables which do not contain a significant financing component.

The application of simplified approach does not require the Company to track changes in
credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each
reporting date, right from its initial recognition. For recognition of impairment loss on other
financial assets and risk exposure, the Company determines that whether there has been
a significant increase in the credit risk since initial recognition. If credit risk has not increased
significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has
increased significantly, lifetime ECL is used.

Derecognition of Financial Assets

A financial asset is derecognized only when:

¦ the Company has transferred the rights to receive cash flows from the financial asset
or

¦ retains the contractual rights to receive the cash flows of the financial asset,
but assumes a contractual obligation to pay the cash flows to one or more
recipients.

Where the entity has transferred an asset, the Company evaluates whether it has transferred
substantially all risks and rewards of ownership of the financial asset. In such cases, the
financial asset is derecognized. Where the entity has not transferred substantially all risks
and rewards of ownership of the financial asset, the financial asset is not derecognized.

Where the entity has neither transferred a financial asset nor retains substantially all risks
and rewards of ownership of the financial asset, the financial asset is derecognized if the
Company has not retained control of the financial asset. Where the Company retains control
of the financial asset, the asset is continued to be recognized to the extent of continuing
involvement in the financial asset.

On derecognition of a financial asset in its entirety, the difference between the asset''s
carrying amount and the sum of the consideration received and receivable and the cumulative
gain or loss that had been recognised in other comprehensive income and accumulated in
equity, if any, is recognised in profit or loss, except in case of equity instruments classified
as FVOCI, where such cumulative gain or loss is not recycled to statement of profit and loss.

Income Recognition
Interest income

Interest income from debt instruments is recognized using the effective interest rate method.
The effective interest rate is the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to the gross carrying amount of a financial
asset.

(ii) Financial Liabilities:

Subsequent Measurement

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability
is classified as at FVTPL if it is classified as held-for-trading, or it is a derivative or it is
designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair
value and net gains and losses, including any interest expense, are recognized in statement
of profit and loss. Other financial liabilities are subsequently measured at amortized cost
using the effective interest method. Interest expense and foreign exchange gains and losses
are recognized in statement of profit and loss. Any gain or loss on derecognition is also
recognized in statement of profit and loss.

Derecognition of Financial Liabilities

A financial liability is derecognized when the obligation specified in the contract is discharged,
cancelled or expires.

Offsetting Financial Instruments

Financial assets and liabilities are offset and the net amount is reported in the Balance Sheet
where there is a legally enforceable right to offset the recognized amounts and there is an
intention to settle on a net basis or realize the asset and settle the liability simultaneously.
The legally enforceable right must not be contingent on future events and must be enforceable
in the normal course of business and in the event of default, insolvency or bankruptcy of the
Company or the counterparty.

(k) Property, plant and equipment

All items of property, plant and equipment are stated at historical cost less accumulated depreciation
and impairment. Historical Cost comprises of the purchase price including import duties and non¬
refundable taxes and directly attributable expenses incurred to bring the asset to the location and
condition necessary for it to be capable of being operated in the manner intended by management.

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

Depreciation methods, rates and residual value

Depreciation is provided on a pro-rata basis on the written down value method over the estimated
useful lives of the assets, based on technical evaluation done by management''s expert, which are
higher than those specified by Schedule II to the Companies Act. 2013, in order to reflect the actual
usage of the assets. The useful life, residual value and the depreciation method are reviewed at
least at each financial year end. If the expectations differ from previous estimates, the changes are
accounted for prospectively as a change in accounting estimate.

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

Gains and losses on disposals are determined by comparing proceeds with carrying amount.
These are included in profit or loss within other gains/(losses).

(l) Leases:

The Company''s lease asset classes primarily consist of leases for building. At the date of the
commencement of the lease, the Company recognises a right-of-use asset representing its right
to use the underlying asset for the lease term and a corresponding lease liability for all the lease
arrangements in which it is a lease, except for leases with a term of twelve months or less (short¬
term leases) and low value leases. For these short-term and low value leases, the Company
recognises the lease payments as an operating expense on a straight-line basis over the period
of the lease.

The right-of-use assets are initially recognised at cost, which comprises the initial amount of the
lease liability adjusted for any lease payments made at or prior to the commencement date of the
lease. They are subsequenty measured at cost less accumulated depreciation and impairment
losses. Right-of-use assets are depreciated from the commencement date on a straight-line basis
over the shorter of the lease term and useful life of the underlying asset. The estimated useful life
of the assets are determined on the same basis as those of property, plant and equipment.

The lease liability is initially measured at amortized cost at the present value of the future lease
payments. The future lease payments are discounted using the interest rate implicit in the lease
or, if not readily determinable, using the incremental borrowing rates. For a lease with reasonably
similar characteristics, the Company, on a lease by lease basis, may adopt either the incremental
borrowing rate specific to the lease or the incremental borrowing rate for the portfolio as a whole.

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Mar 31, 2014

1. BASIS FOR PREPARATION OF FINANCIAL STATEMENTS:

a. The financial statements have been prepared and presented under the historical cost convention and materially comply with the accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956, unless stated otherwise.

b. Company generally follows mercantile system of accounting, recognizing significant items of income and ex- penditure on accrual basis except in the case of income from investments, income by way of extra work receipts, and income by way of sales of scrap, expenses by way of retirement benefits to employees, which are recognized on cash basis.

2. USE OF ESTIMATES:

The preparation of financial statements in conformity with the generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of income and expenses of the period, assets and liabilities and disclosures relating to contingent liabilities as of the date of the financial statements. Actual results could differ from those estimated. Any revision to accounting estimates is recognized prospectively in future periods.

3. FIXED ASSETS:

Fixed assets are stated at "HISTORICAL COST" inclusive of cost of acquisition and directly attributable costs such as freight, installation, etc. incurred for bringing the assets to their working conditions, except that in the case of office building and furniture and fixtures which are stated at revalued amount.

4. DEPRECIATION:

Depreciation on Fixed Assets has been provided on "STRAIGHT LINE METHOD" at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in the case of any additions/deletions has been provided on pro-rata basis. Depreciation on the revalued part comprised in value of assets is charged to the revaluation reserve created out of revaluation of those fixed assets.

5. INVESTMENTS:

Investments being long term in nature are stated at "COST". No provision is made for any diminution in the value of the same

6. VALUATION OF INVENTORIES:

a. Inventory of building materials is valued at cost.

b. Work in progress at the 31/03/2014 has been verified, valued and certified by the management based on the terms of agreement with the respective principals.

c. Inventory by way of land held for development of project is valued at cost of acquisition along with ancillary expenses.

7. REVENUE RECOGNITION / ACCOUNTING FOR CONSTRUCTION CONTRACTS:

a. In respect of the construction contracts on hand, company recognizes revenue at the year end on the basis of "PERCENTAGE OF WORK COMPLETION" method based on the amounts admitted by principals or certified by the Architect till the year end in accordance with the agreements entered into with the principal.

b. In case of sale of goods the revenue is recognized upon dispatch of goods.

c. In case of sales of securities the revenue is recognized upon executing contract in that respect.

8. CASHFLOW STATEMENTS:

The cash flow statement is prepared showing differently, the cash flow from Operating Activities, Investing Activi- ties and Financing Activities during the year.

9. PRIOR PERIOD ITEMS:

Material items related to earlier period, to the extent distinctly identifiable, are accordingly accounted.

10. EMPLOYEE BENEFITS:

a. Company''s contribution to Provident Fund is charged to Profit & Loss account.

b. Gratuity, Leave Encashment and other retirement benefits payable to employees are accounted for on cash basis.

11. RELATED PARTY DISCLOSURES:

The disclosure in respect of names, relationship, nature and volume of transactions with related parties is made in the accounts. The disclosure has been made by the management which has been relied upon by the auditors.

12. EARNINGS PER SHARE:

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

13. ACCOUNTING FOR TAXES ON INCOME:

Tax expense for a year comprises of current tax and deferred tax. Current tax is measured after taking into consideration, the deductions and exemptions admissible under relevant provisions of the Income Tax Act, 1961.

Deferred Tax, which is computed on the basis of enacted/ substantially enacted rates, is recognized, on timing differences, being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred Tax assets are recognized only to the extent there Is reasonable certainty of realization thereof in future.

14. IMPAIRMENT OF ASSETS:

As per an assessment carried out by the management as on the balance sheet date, there is no indication of any substantial loss on account of overall impairment in the value of the assets. In the opinion of the manage- ment the assets are likely to recover the value at which these are stated in the accounts, on an overall basis.

15. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities if material are disclosed by way of Notes.

16. SALES TURNOVER:

Sales Turnover for the period is exclusive of duties and taxes to the extent applicable and is net of sales return.

17. EXPENSES:

Material known liabilities are provided for on the basis of available information/estimates at the period end.

18. BORROWING COSTS:

Borrowing Costs specifically identified to the acquisition or construction of qualifying assets is capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Profit and Loss Account.

19. SEGMENT REPORTING:

The management has identified two business segments viz, Real estate development/contracting and Securi- ties trading for the reported period. Details of turnover, carrying cost of assets, capital employed, & expenses and profit/loss in respect of each of the above segments is marked as Annexure hereto.

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Mar 31, 2013

BASIS FOR PREPARATION OF FINANCIAL STATEMENTS:

a. The financial statements have been prepared and presented under the historical cost convention and materially comply with the accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956, unless stated otherwise.

b. Company generally follows mercantile system of accounting, recognizing significant items of income and expenditure on accrual'basis except in the case of income from investments, income by way of extra work receipts, and income by way of sales of scrap, expenses by way of retirement benefits to employees, which are recognized on cash basis.

2. USE OF ESTIMATES:

The preparation of financial statements in conformity with the generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of income and expenses of the period, assets and liabilities and disclosures relating to contingent liabilities as of the date of the financial statements. Actual results could differ from those estimated. Any revision to accounting estimates is recognized prospectively in future periods.

3. FIXED ASSETS:

Fixed assets are stated at "HISTORICAL COST" inclusive of cost of acquisition and directly attributable costs such as . freight, installation, etc. incurred for bringing the assets to their working conditions, except that in the case of office building and furniture and fixtures which are stated at revalued amount.

4. DEPRECIATION:

Depreciation on Fixed Assets has been provided on "STRAIGHT LINE METHOD" at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in the case of any additions/deletions has been provided on pro-rata basis. Depreciation on the revalued part comprised in value of assets is charged to the revaluation reserve created out of revaluation of those fixed assets.

5. INVESTMENTS:

Investments being long term in nature are stated at "COST". No provision is.made for any diminution in the value Of the same._

6. VALUATION OF INVENTORIES:

a. Inventory of building materials is valued at cost.

b. Work in progress at the year-end has been verified, valued and certified by the management based on the terms of agreement with the respective principals.

c. Inventory by way of land held for development of project is valued at cost of acquisition alognlwith ancilliary expenses. .

7. REVENUE RECOGNITION / ACCOUNTING FOR CONSTRUCTION CONTRACTS: '

a. In respect of the construction contracts on hand, company recognizes revenue at the year end on the basis of "PERCENTAGE OF WORK COMPLETION" method based on the amounts admitted by principals or certified by the Architect till the year end in accordance with the agreements entered into with the principal.

b. In case of sale of goods the revenue is recognized upon dispatch of goods.

c. Income by way of compensation for surrender of development nght is recognized upon execution of agreement in that respect.

d. In case of, sale of shares and securities upon execution of contract in that respect.

e. In case of, intraday dealing as well as derivatives, upon completion of the contact.

8. CASH FLOW STATEMENTS:

The cash flow statement is prepared showing differently, the cash flow from Operating Activities, Investing Activities and Financing Activities during the year.

9. PRIOR PERIOD ITEMS:

Material items related to earlier period, to the extent distinctly identifiable, are accordingly accounted.

10. EMPLOYEE BENEFITS:

a. Company's contribution to Provident Fund is charged to Profit & Loss account.

b. Gratuity, Leave Encashment and other retirement benefits payable to employees are accounted for on cash basis.

7T. RELATED PARTY DISCLOSURES:

The disclosure in respect of names, relationship, nature and volume of transactions with related parties is made in the accounts. The disclosure has been made by the management which has been relied upon by the auditors.

2. EARNINGS PER SHARE:

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

TT ACCOUNTING FOR TAXES ON INCOME:

Tax expense for a year comprises of current tax and deferred tax Current tax is measured after taking into consideration, the deductions and exemptions admissible under relevant provisions of the Income Tax Act, 1961.

Deferred Tax, which is computed on the basis of enacted/ substantially enacted rates, is recognized, on timing differences, being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred Tax assets are recognized only to the extent there is reasonable certainty of realization thereof in future. ,

TT IMPAIRMENT OF ASSETS:

As per an assessment carried out by the management as on the balance sheet date, there is no indication of any substantial loss on account of overall impairment in the value of the assets. In the opinion of the management the assets are likely to recover the value at which these are stated in the accounts, on at) overall basis. -

TsT PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS: '

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities if material are disclosed by way of Notes.

SALES TURNOVER: :

Sales Turnover for the year is exclusive of duties and taxes to the extent applicable and is net of sales return.

EXPENSES:

Material known liabilities are provided for on the basis of available information/estimates at the year end.

BORROWING COSTS:

Borrowing Costs specifically identified to the acquisition or construction of qualifying assets is capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get. ready for intended use. All other borrowing costs are charged to Profit and Loss Account.

SEGMENT REPORTING":

The management has identified two business segments it is operating in, viz, Construction and Trading. Details of turnover, carrying cost of assets, capital employed, & expenses and profit/loss in respect of each of the above segments are being reported.