Accounting Policies of SRG Housing Finance Ltd. Company

Mar 31, 2025

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES
2.1. PROPERTY, PLANT AND EQUIPMENT
(PPE)

PPE is recognized 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 PPE are stated at cost
of acquisition, less accumulated depreciation
and impairment losses, if any. Direct costs are
capitalized until the assets are ready for use
and include freight, duties, taxes and expenses

incidental to acquisition and installation.
The carrying amount of any component
accounted for as a separate asset is derecognized
when replaced. All other repairs and maintenance
are charged to profit or loss during the reporting
period in which they are incurred.

Subsequent expenditures related to an item
of PPE are added to its book value only if they
increase the future benefits from the existing
asset beyond its previously assessed standard of
performance. Losses arising from the retirement
of, and gains or losses arising from disposal
of PPE are recognized in the Statement of
Profit and Loss.

Depreciation is provided on a pro-rata basis on
the Written Down Value method (''WDV'') over
the estimated useful lives of the assets specified
in Schedule II of the Companies Act, 2013.
The assets'' residual values and useful lives are
reviewed, and adjusted if appropriate, at the end
of each reporting period.

* For the above class of assets, based on internal
assessment, the management believes that the useful
lives as given above best represent the period over
which management expects to use these assets. Hence,
the useful lives for these assets are different from the
useful lives as prescribed under Part C of Schedule II of
the Companies Act, 2013

2.2. INTANGIBLE ASSETS

Intangible Assets comprising application
software are recognized when it is probable that
the future economic benefits that are attributable
to the asset will flow to the enterprise and the

cost of the asset can be measured reliably.
Intangible assets are stated at original cost
less accumulated amortization and cumulative
impairment. Administrative and other general
overhead expenses that are specifically
attributable to acquisition of intangible assets are
allocated and capitalized as a part of the cost of
the intangible assets.

Intangible assets are amortized on Written Down
Value basis over the estimated useful life of 3
years. The method of amortization and useful life
are reviewed at the end of each accounting year
with the effect of any changes in the estimate
being accounted for on a prospective basis.

An intangible asset is derecognized on disposal or
when no future economic benefits are expected
from use or disposal. Gains or losses arising from
de-recognition of an intangible asset, measured
as the difference between the net disposal
proceeds and the carrying amount of the asset
and are recognized in profit or loss when the
asset is derecognized.

2.3 FINANCIAL INSTRUMENTS

Financial instruments comprise of financial
assets and financial liabilities. Financial assets
and financial liabilities are recognized in the
Company''s balance sheet when the Company
becomes a party to the contractual provisions
of the instrument. Financial assets primarily
comprise of loans and advances, deposits, trade
receivables and cash and cash equivalents.
Financial liabilities primarily comprise of
borrowings and trade payables.

Financial Assets and Financial Liabilities are
recognized when the Company becomes a party
to the contractual provisions of the instruments.
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 Statement of Profit
or Loss Account.

1) Financial Assets

Financial Assets include cash, or an equity
instrument of another entity, or a contractual
right to receive cash or another financial asset
from another entity. Few examples of financial
assets are loan receivables, investment in equity
and debt instruments, trade receivables and cash
and cash equivalents.

a. Recognition and Initial measurement

All financial assets are recognized and
derecognized on a trade date where the
purchase or sale of a financial asset is under
a contract whose terms require delivery
of the financial asset within the timeframe
established by the market concerned,
and are initially measured at fair value,
plus transaction costs, except for those
financial assets classified as at FVTPL.
Transaction costs directly attributable to
the acquisition of financial assets classified
as at FVTPL are recognized immediately in
profit or loss. All recognized financial assets
that are within the scope of Ind AS 109 are
required to be subsequently measured at
amortized cost or fair value on the basis of
the entity''s business model for managing the
financial assets and the contractual cash flow
characteristics of the financial assets.

b. Classification of Financial Assets

• Debt instruments that are held within
a business model whose objective is to
collect the contractual cash flows, and
that have contractual cash flows that are
Solely Payments of principal and Interest
on the principal amount outstanding
(SPPI), are subsequently measured at
amortized cost;

• All other debt instruments (e.g.
debt instruments managed on a fair
value basis, or held for sale) and
equity investments are subsequently
measured at FVTPL.

However, the Company may make the
following irrevocable election / designation
at initial recognition of a financial asset on an
asset by-asset basis:

• The Company may irrevocably

designate a debt instrument that meets
the amortized cost or FVTOCI criteria
as measured at FVTPL if doing so
eliminates or significantly reduces an
accounting mismatch (referred to as the
fair value option).

c. Subsequent Measurement

The Company classifies all of its financial
assets based on the business model for
managing the assets and the asset''s
contractual terms, measured at either:

- Amortized Cost

- Fair Value through Other
Comprehensive Income (“FVOCI”)

- Fair Value through Profit and
Loss (“FVTPL”)

d. Debt instruments at Amortized Cost

The Company assesses the classification and
measurement of a financial asset based on
the contractual cash flow characteristics of
the asset individually and the Company''s
business model for managing the asset.
For an asset to be classified and measured at
amortised cost or at FVTOCI, its contractual
terms should give rise to cash flows that are
meeting SPPI test.

For the purpose of SPPI test, principal is
the fair value of the financial asset at initial
recognition. That principal amount may
change over the life of the financial asset
(e.g. if there are repayments of principal).

Interest consists of consideration for the time
value of money, for the credit risk associated
with the principal amount outstanding
during a particular period of time and for
other basic lending risks and costs, as well as
a profit margin.

Contractual cash flows that are SPPI are
consistent with a basic lending arrangement.
Contractual terms that introduce exposure to
risks or volatility in the contractual cash flows
that are unrelated to a basic lending
arrangement, such as exposure to changes in
equity prices or commodity prices, do not give
rise to contractual cash flows that are SPPI. An
originated or an acquired financial asset can
be a basic lending arrangement irrespective
of whether it is a loan in its legal form.

Assets that are held for collection of
contractual cash flows where those cash
flows represent solely payments of principal
and interest are measured at amortized cost.
A gain or loss on a debt investment that is
subsequently measured at amortized cost
and is not part of a hedging relationship is
recognized in profit or loss when the asset
is derecognized or impaired. Interest income
from these financial assets is included
in finance income using the effective
interest rate method.

The expected credit loss (ECL) calculation
for debt instruments at amortized cost is
explained in subsequent notes in this section

e. Debt instruments at FVTPL

The Company classifies financial assets which
are held for trading under FVTPL category.
Held for trading assets are recorded and
measured in the balance sheet at fair value.
Interest and dividend income is recorded
in interest income and dividend income
respectively according to the terms of the
contract, or when the right to receive the
same has been established. Gain and losses
on changes in fair value of debt instruments
are recognized on net basis through
profit or loss.

The Company''s investments into mutual
funds and bonds for trading.

f. Investment in Equity Instruments at FVTOCI

A financial asset shall be measured at fair
value through other comprehensive income
if both of the following conditions are met:

(a) the financial asset is held within a business
model whose objective is achieved by
both collecting contractual cash flows
and selling financial assets and

(b) the contractual terms of the financial
asset give rise on specified dates to
cash flows that are solely payments of
principal and interest on the principal
amount outstanding.

The Company measures its equity
investments at fair value through Other
Comprehensive Income.

g. Derecognition of Financial Assets

A financial asset is derecognized only when:

• The Company has transferred the
rights to receive cash flows from the
financial assets or

• retains the contractual rights to receive
the cash flows of the financial assets, 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 assets. 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.

In accordance with the Ind AS 109, on
derecognition of a financial asset under
assignment transactions, the difference

between the carrying amount and the
consideration received shall be recognised in
Statement of Profit and Loss.

h. Impairment of Financial Assets:

The measurement of impairment losses
across all categories of financial assets
requires judgment, in particular, the
estimation of the amount and timing of
future cash flows and collateral values when
determining impairment losses and the
assessment of a significant increase in credit
risk. These estimates are driven by a number
of factors, changes in which can result in
different levels of allowances.

The Company''s Expected Credit Loss (“ECL”)
model comprises of number of underlying
assumptions regarding the choice of
variable inputs and their interdependencies.
Elements of the ECL model that are
considered accounting judgments and
estimates include:

1. The classification of loan portfolio into
various stages based on the number
of days overdue.

2. Value of collaterals considered for loan
loss allowance.

3. The criteria for assessing if there has
been a significant increase in credit risk.

The Company measures the loss allowance
for a financial instrument at an amount
equal to the lifetime expected credit losses
if the credit risk on that financial instrument
has increased significantly since initial
recognition. If the credit risk on a financial
instrument has not increased significantly
since initial recognition, the Company
measures the loss allowance for that financial
instrument at an amount equal to 12-month
expected credit losses. 12-month expected
credit losses are portion of the life-time
expected credit losses and represent the
lifetime cash shortfalls that will result if

default occurs within the 12 months after
the reporting date and thus, are not cash
shortfalls that are predicted over the next
12 months. The Company applies the
expected credit loss model for recognizing
impairment loss on financial assets measured
at amortized cost, loan commitments, trade
receivables and other contractual rights to
receive cash or other financial asset.

The Company uses expected credit loss
(“ECL”) allowance for financial assets
measured at amortized cost, which are not
individually significant, and comprise of a
large number of homogeneous loans that
have similar characteristics. The expected
credit loss is a product of exposure at default,
probability of default and loss given default.
The measurement of the loss allowance in
respect of loans (other than those measured
at FVTPL is based on the present value of
the asset''s expected cash flows using the
asset''s original EIR.

The Company has established a policy to
perform an assessment, at the end of each
reporting period, of whether a financial
instrument''s credit risk has increased
significantly since initial recognition, by
considering the change in the risk of default
occurring over the remaining life of the
financial instrument.

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

• Stage 1 - For exposures where there has
not been a significant increase in credit
risk since initial recognition and that are
not credit impaired upon origination, the
portion of the lifetime ECL associated
with the probability of default events
occurring within the next 12 months is
recognized. Exposures with days past
due (DPD) less than or equal to 30 days
are classified as Stage 1. The Company

has provided ECL on the undisbursed loan
commitments classified under Stage 1.

• Stage 2- For credit exposures where
there has been a significant increase in
credit risk since initial recognition but
that are not credit impaired, a lifetime
ECL is recognized. Exposures with DPD
equal to 31 days but less than or equal
to 90 days are classified as Stage 2.
At each reporting date, the Company
assesses whether there has been a
significant increase in credit risk for the
financial asset since initial recognition by
comparing the risk of a default occurring
over the expected life between the
reporting date and the date of initial
recognition. The Company has identified
cases with DPD equal to or more than 31
days and less than or equal to 60 days
and cases with DPD equal to or more
than 61 days and less than or equal to 90
days as two separate buckets

• Stage 3 - A financial asset is assessed as
credit-impaired when one or more events
that have a detrimental impact on the
estimated future cash flows of that asset
have occurred. For a financial asset that
has become credit impaired, a lifetime
ECL is recognized on outstanding
balance. Exposures with DPD more than
90 days are classified as Stage 3

Being a housing finance company, the
company has to follow the applicable
guidelines given by the Reserve Bank of India
on Prudential norms on Asset Classification
and provisioning requirement. The company
provides for impairment of financial assets
on the basis of the Expected Credit Loss
Model or the prudential norms of RBI
whichever is higher.

i. Write-offs

I mpaired loans and receivables are written
off, against the related allowance for loan
impairment on completion of the Company''s
internal processes and when the Company

concludes that there is no longer any
realistic prospect of recovery of part or all
of the loan. For loans that are individually
assessed for impairment, the timing of write
off is determined on a case-by-case basis.
A write-off constitutes a de recognition
event. The Company has a right to apply
enforcement activities to recover such written
off financial assets. Subsequent recoveries of
amounts previously written off are credited
to the statement of profit and loss.

2) Financial liabilities

Financial liabilities include liabilities that
represent a contractual obligation to deliver cash
or another financial assets to another entity, or a
contract that may or will be settled in the entities
own equity instruments few examples of financial
liabilities are trade payables, debt securities and
other borrowings.

a) Recognition and Initial Measurement

Financial liabilities are classified as at
FVTPL when the financial liability is held
for trading or it is designated as at FVTPL.
Financial liabilities that are not held-for-
trading and are not designated as at FVTPL
are measured at amortized cost at the
end of subsequent accounting periods.
The carrying amounts of financial liabilities
that are subsequently measured at amortized
cost are determined based on the effective
interest method.

b) Subsequent Measurement

All financial liabilities are subsequently
measured at amortized cost using the
effective interest rate method or at FVTPL.

The effective interest method is a method of
calculating the amortized cost of a financial
liability and of allocating interest expense
over the relevant period. The effective
interest rate is the rate that exactly discounts
estimated future cash payments (including
all fees paid or received that form an
integral part of the effective interest rate,
transaction costs and other premiums or

discounts) through the expected life of the
financial liability, or (where appropriate) a
shorter period, to the amortised cost of a
financial liability.

c) Derecognition of Financial Liabilities

The Company derecognizes financial
liabilities when, and only when, the
Company''s obligations are discharged,
cancelled or have expired. An exchange
between the Company and the lender of
debt instruments with substantially different
terms is accounted for as an extinguishment
of the original financial liability and the
recognition of a new financial liability.

d) Collateral Valuation and Repossession

The Company provides fully secured, loans
to individuals and Corporates to mitigate the
credit risk on financial assets, the Company
seeks to use collateral, where possible as
per the powers conferred on the Housing
Finance Companies under the Securitisation
and Reconstruction of Financial Assets and
Enforcement of Securities Interest Act,
2002 (“SARFAESI”)

2.4. EMPLOYEE BENEFITS

a. Short Term Employee Benefits:

Short Term Employee Benefits are recognized
during the period when the services are
rendered. These short term benefits include
Bonus, Incentive and other benefits which fall due
within twelve months after the end of the period
in which services are rendered.

b. Post-Employment Benefits

1) Defined Contribution Plan
Provident Fund-:

The Company contributes to a Government
administered Provident Fund in accordance
with the provisions of Employees Provident
Fund Act. The Amount contributed is
recognized as an expense in the period
in which the services are rendered
by the employees.

Employee state Insurance

The Company contributes certain amount
to Employee state Insurance as per the
provisions of the Employee state insurance
act and is recognized as an expense in the
period in which the services are rendered
by the employees

2) Defined Benefit Plan

The Company''s Gratuity liability under the
Payment of Gratuity Act, 1972 is determined
on the basis of actuarial valuation made
at the end of each financial year using the
projected unit credit method.

The Company''s net obligation in respect
of defined benefit plans is calculated by
estimating the amount of future benefit that
employees have earned in the current and
prior periods, discounting that amount and
deducting the fair value of any plan assets.

The calculation of defined benefit obligations
is performed periodically by a qualified
actuary using the projected unit credit
method. When the calculation results in
a potential asset for the Company, the
recognition of the asset is limited to the
present value of economic benefits available
in the form of any future refunds from the plan
or reductions in future contributions to the
plan. Measurement of the net defined benefit
liability, which comprise actuarial gains and
losses, the return on plan assets (excluding
interest) and the effect of the asset ceiling
(if any, excluding interest), are recognized
immediately in Other Comprehensive
Income (OCI). Net interest expense (income)
on the net defined liability (assets) is
computed by applying the discount rate,
used to measure the net defined liability
(asset), to the net defined liability (asset)
at the start of the financial year after taking
into account any changes as a result of
contribution and benefit payments during
the year. Net interest expense and other
expenses related to defined benefit plans are
recognized in Statement of Profit and Loss.

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Mar 31, 2024

2. SIGNIFICANT ACCOUNTING POLICIES 2.1. PROPERTY, PLANT AND EQUIPMENT (PPE)

PPE is recognized 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 PPE are stated at cost of acquisition, less accumulated depreciation and impairment losses, if any. Direct costs are capitalized until the assets are ready for use and include freight, duties, taxes and expenses incidental to acquisition and installation. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

Subsequent expenditures related to an item of PPE are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance. Losses arising from the retirement of, and gains or losses arising from disposal of PPE are recognized in the Statement of Profit and Loss.

Depreciation is provided on a pro-rata basis on the Written Down Value method (''WDV'') over the estimated useful lives of the assets specified in Schedule II of the Companies Act, 2013. The assets'' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

The estimated useful lives of Property, Plant and Equipment are as below: *For the above class of assets, based on internal assessment, the management believes that the useful lives as given above best represent the period over which management expects to use these assets. Hence, the useful lives for these assets are different from the useful lives as prescribed under Part C of Schedule II of the Companies Act, 2013

2.2. INTANGIBLE ASSETS

Intangible Assets comprising application

software are recognized when it is probable that the future economic benefits that are attributable to the asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible assets are stated at original cost less accumulated amortization and cumulative impairment. Administrative and other general overhead expenses that are specifically

attributable to acquisition of intangible assets are

allocated and capitalized as a part of the cost of the intangible assets.

Intangible assets are amortized on Written Down Value basis over the estimated useful life of 3 years. The method of amortization and useful life are reviewed at the end of each accounting year with the effect of any changes in the estimate being accounted for on a prospective basis.

An intangible asset is derecognized on disposal or when no future economic benefits are expected from use or disposal. Gains or losses arising from de-recognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in profit or loss when the asset is derecognized.

2.3 FINANCIAL INSTRUMENTS

Financial instruments comprise of financial assets and financial liabilities. Financial assets and financial liabilities are recognized in the Company''s balance sheet when the Company becomes a party to the contractual provisions of the instrument. Financial assets primarily comprise of loans and advances, deposits, trade receivables and cash and cash equivalents. Financial liabilities primarily comprise of borrowings and trade payables.

Financial Assets and Financial Liabilities are recognized when the Company becomes a party to the contractual provisions of the instruments. 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 Statement of Profit or Loss Account.

1) Financial Assets

Financial Assets include cash, or an equity instrument of another entity, or a contractual right to receive cash or another financial asset from another entity. Few examples of financial assets are loan receivables, investment in equity and debt instruments, trade receivables and cash and cash equivalents.

a. Recognition and Initial measurement

All financial assets are recognized and derecognized on a trade date where the purchase or sale of a financial asset is under a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned, and are initially measured at fair value, plus transaction costs, except for those financial assets classified as at FVTPL. Transaction costs directly attributable to the acquisition of financial assets classified as at FVTPL are recognized immediately in profit or loss. All recognized financial assets that are within the scope of Ind AS 109 are required to be subsequently measured at amortized cost or fair value on the basis of the entity''s business model for managing the financial assets and the contractual cash flow characteristics of the financial assets.

b. Classification of Financial Assets

• Debt instruments that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are Solely Payments of principal and Interest on the principal amount outstanding (SPPI), are subsequently measured at amortized cost;

• All other debt instruments (e.g. debt instruments managed on a fair value basis, or held for sale) and equity investments are subsequently measured at FVTPL.

However, the Company may make the following irrevocable election /

designation at initial recognition of a financial asset on an asset by-asset basis :

• The Company may irrevocably designate a debt instrument that meets the amortized cost or FVTOCI criteria as measured at FVTPL if doing so eliminates or significantly reduces an accounting mismatch (referred to as the fair value option).

c. Subsequent Measurement

The Company classifies all of its financial assets based on the business model for managing the assets and the asset''s contractual terms, measured at either:

- Amortized Cost

- Fair Value through Other Comprehensive Income (“FVOCI”)

- Fair Value through Profit and Loss (“FVTPL”)

d. Debt instruments at Amortized Cost

The Company assesses the classification and measurement of a financial asset based on the contractual cash flow characteristics of the asset individually and the Company''s business model for managing the asset. For an asset to be classified and measured at amortised cost or at FVTOCI, its contractual terms should give rise to cash flows that are meeting SPPI test.

For the purpose of SPPI test, principal is the fair value of the financial asset at initial recognition. That principal amount may change over the life of the financial asset (e.g. if there are repayments of principal). Interest consists of consideration for the time value of money, for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs, as well as a profit margin.

Contractual cash flows that are SPPI are consistent with a basic lending arrangement.

Contractual terms that introduce exposure to risks or volatility in the contractual cash flows that are unrelated to a basic lending arrangement, such as exposure to changes in equity prices or commodity prices, do not give rise to contractual cash flows that are SPPI. An originated or an acquired financial asset can be a basic lending arrangement irrespective of whether it is a loan in its legal form.

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. A gain or loss on a debt investment that is subsequently measured at amortized cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.

The expected credit loss (ECL) calculation for debt instruments at amortized cost is explained in subsequent notes in this section

e. Debt instruments at FVTPL

The Company classifies financial assets which are held for trading under FVTPL category. Held for trading assets are recorded and measured in the balance sheet at fair value. Interest and dividend income is recorded in interest income and dividend income respectively according to the terms of the contract, or when the right to receive the same has been established. Gain and losses on changes in fair value of debt instruments are recognized on net basis through profit or loss.

The Company''s investments into mutual funds and bonds for trading.

f. Investment in Equity Instruments at FVTOCI

A financial asset shall be measured at fair value through other comprehensive income if both of the following conditions are met:

(a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and

(b) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The Company measures its equity investments at fair value through Other Comprehensive Income.

g. Derecognition of Financial Assets

A financial asset is derecognized only when:

• The Company has transferred the rights to receive cash flows from the financial assets or

• retains the contractual rights to receive the cash flows of the financial assets, 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 assets. 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.

In accordance with the Ind AS 109, on derecognition of a financial asset under assignment transactions, the difference between the carrying amount and the consideration received shall be recognised in Statement of Profit and Loss.

h. Impairment of Financial Assets:

The measurement of impairment losses across all categories of financial assets requires judgment, in particular, the estimation of the amount and timing of future cash flows and collateral values when determining impairment

losses and the assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which can result in different levels of allowances.

The Company''s Expected Credit Loss ("ECL") model comprises of number of underlying assumptions regarding the choice of variable inputs and their interdependencies. Elements of the ECL model that are considered accounting judgments and estimates include:

1. The classification of loan portfolio into various stages based on the number of days overdue.

2. Value of collaterals considered for loan loss allowance.

3. The criteria for assessing if there has been a significant increase in credit risk.

The Company measures the loss allowance for a financial instrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increased significantly since initial recognition. If the credit risk on a financial instrument has not increased significantly since initial recognition, the Company measures the loss allowance for that financial instrument at an amount equal to 12-month expected credit losses. 12-month expected credit losses are portion of the life-time expected credit losses and represent the lifetime cash shortfalls that will result if default occurs within the 12 months after the reporting date and thus, are not cash shortfalls that are predicted over the next 12 months. The Company applies the expected credit loss model for recognizing impairment loss on financial assets measured at amortized cost, loan commitments, trade receivables and other contractual rights to receive cash or other financial asset.

The Company uses expected credit loss (“ECL”) allowance for financial assets measured at amortized cost, which are not individually significant, and comprise of a

large number of homogeneous loans that have similar characteristics. The expected credit loss is a product of exposure at default, probability of default and loss given default. The measurement of the loss allowance in respect of loans (other than those measured at FVTPL is based on the present value of the asset''s expected cash flows using the asset''s original EIR.

The Company has established a policy to perform an assessment, at the end of each reporting period, of whether a financial instrument''s credit risk has increased significantly since initial recognition, by considering the change in the risk of default occurring over the remaining life of the financial instrument.

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

• Stage 1 - For exposures where there has not been a significant increase in credit risk since initial recognition and that are not credit impaired upon origination, the portion of the lifetime ECL associated with the probability of default events occurring within the next 12 months is recognized. Exposures with days past due (DPD) less than or equal to 30 days are classified as Stage 1. The Company has provided ECL on the undisbursed loan commitments classified under Stage 1.

• Stage 2- For credit exposures where there has been a significant increase in credit risk since initial recognition but that are not credit impaired, a lifetime ECL is recognized. Exposures with DPD equal to 31 days but less than or equal to 90 days are classified as Stage 2. At each reporting date, the Company assesses whether there has been a significant increase in credit risk for the financial asset since initial recognition by comparing the risk of a default occurring over the expected life between the

reporting date and the date of initial recognition. The Company has identified cases with DPD equal to or more than 31 days and less than or equal to 60 days and cases with DPD equal to or more than 61 days and less than or equal to 90 days as two separate buckets

• Stage 3 - A financial asset is assessed as credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that asset have occurred. For a financial asset that has become credit impaired, a lifetime ECL is recognized on outstanding balance. Exposures with DPD more than 90 days are classified as Stage 3

Being a housing finance company, the company has to follow the applicable guidelines given by the Reserve Bank of India on Prudential norms on Asset Classification and provisioning requirement. The company provides for impairment of financial assets on the basis of the Expected Credit Loss Model or the prudential norms of RBI whichever is higher.

i. Write-offs

Impaired loans and receivables are written off, against the related allowance for loan impairment on completion of the Company''s internal processes and when the Company concludes that there is no longer any realistic prospect of recovery of part or all of the loan. For loans that are individually assessed for impairment, the timing of write off is determined on a case-by-case basis. A write-off constitutes a de recognition event. The Company has a right to apply enforcement activities to recover such written off financial assets. Subsequent recoveries of amounts previously written off are credited to the statement of profit and loss.

2) Financial liabilities

Financial liabilities include liabilities that represent a contractual obligation to deliver cash or another financial assets to another entity, or a

contract that may or will be settled in the entities own equity instruments few examples of financial liabilities are trade payables, debt securities and other borrowings.

a) Recognition and Initial Measurement

Financial liabilities are classified as at FVTPL when the financial liability is held for trading or it is designated as at FVTPL. Financial liabilities that are not held-for-trading and are not designated as at FVTPL are measured at amortized cost at the end of subsequent accounting periods. The carrying amounts of financial liabilities that are subsequently measured at amortized cost are determined based on the effective interest method.

b) Subsequent Measurement

All financial liabilities are subsequently measured at amortized cost using the effective interest rate method or at FVTPL.

The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the amortised cost of a financial liability.

c) Derecognition of Financial Liabilities

The Company derecognizes financial liabilities when, and only when, the Company''s obligations are discharged, cancelled or have expired. An exchange between the Company and the lender of debt instruments with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability.

d) Collateral Valuation and Repossession

The Company provides fully secured, loans to individuals and Corporates to mitigate the credit risk on financial assets, the Company seeks to use collateral, where possible as per the powers conferred on the Housing Finance Companies under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (“SARFAESI”)

2.4. EMPLOYEE BENEFITS

a. Short Term Employee Benefits:

Short Term Employee Benefits are recognized during the period when the services are rendered. These short term benefits include Bonus, Incentive and other benefits which fall due within twelve months after the end of the period in which services are rendered.

b. Post-Employment Benefits

1) Defined Contribution Plan Provident Fund-:

The Company contributes to a Government administered Provident Fund in accordance with the provisions of Employees Provident Fund Act. The Amount contributed is recognized as an expense in the period in which the services are rendered by the employees.

Employee state Insurance

The Company contributes certain amount to Employee state Insurance as per the provisions of the Employee state insurance act and is recognized as an expense in the period in which the services are rendered by the employees

2) Defined Benefit Plan

The Company''s Gratuity liability under the Payment of Gratuity Act, 1972 is determined on the basis of actuarial valuation made at the end of each financial year using the projected unit credit method.

The Company''s net obligation in respect of defined benefit plans is calculated by

estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed periodically by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Company, the recognition of the asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. Measurement of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in Other Comprehensive Income (OCI). Net interest expense (income) on the net defined liability (assets) is computed by applying the discount rate, used to measure the net defined liability (asset), to the net defined liability (asset) at the start of the financial year after taking into account any changes as a result of contribution and benefit payments during the year. Net interest expense and other expenses related to defined benefit plans are recognized in Statement of Profit and Loss.

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Mar 31, 2018

1. Basis of Preparation

The Financial Statements are prepared and presented under the historical cost convention in accordance with the Generally Accepted Accounting Principles (GAAP), and provisions referred to in Section 133 of The Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 and other relevant provisions of The Companies Act, 2013 and accounting standards issued by The Institute of Chartered Accountants of India (ICAI) as applicable. The Company also follows the directions prescribed by the National Housing Bank (NHB) to the extent applicable.

2. Income Recognition

Interest income on housing / other loans and other dues are accounted on accrual basis. Housing / other loans are classified into “Performing and non- performing assets” in terms of the directions issued by the NHB from time to time. Income recognition on non-performing advances are made in accordance with the NHB guidelines. Fees and additional interest income on delayed EMI/Pre-EMI are recognized on receipt basis.

3. Interest on Loans

Repayment of the Loans are by way of equated monthly installments (EMIs) comprising principal and interest. The interest is calculated on the outstanding balances at the beginning of the month. EMIs commence once the entire loan is disbursed. Pending commencement of EMI, pre-equated monthly installment interest is payable every month. Interest on loan assets classified as “NonPerforming” is recognized only on actual receipt.

4. Income from Investment

Interest income from investment is accounted on an accrual basis. Dividend Income on investments is recognized when the right to receive the same is established.

5. Property, Plant and Equipment

- Property, Plant and Equipment (PPE) are stated at cost less accumulated depreciation and impaired losses, if any.

- Depreciation on PPE is provided on pro-rata basis on “Written Down Value Method” from the date of installation based on life assigned to each asset in accordance with Schedule II of The Companies Act, 2013.

6. Intangible Assets & Amortization:

- Intangibles Assets are stated at cost of acquisition (including any cost attributable to bringing the same in its working condition) less accumulated amortization.

- Intangible assets are amortized over their estimated useful life oRs. 3 years on Written Down Value Method. The amortization period and the amortization method for intangible assets with a finite useful life are reviewed at each reporting date.

7. Impairment of Assets

Impairment losses (if any) on Assets are recognised in accordance with the Accounting Standard on ‘Impairment of Assets’ (AS 28). The Company assesses at each Balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the assets. An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value.

8. Leases

In accordance with the Accounting Standard on Leases (AS 19), the following disclosures in respect of operating leases are made:

The company has taken office premises under operating leases which are generally cancellable and have no specific obligation for renewal. The total lease payments are recognised as per lease terms in the Statement of Profit and Loss under ‘Rent Expenses’ under note 19.

9. Provision on Non-Performing Assets & for Diminution in Investment Value

Non-performing assets are identified and categorized into Sub-standard, Doubtful and Loss Category based on the guidelines and directions issued by NHB. Provisions for non-performing assets and for diminution in investment value are made in the accordance with the NHB guidelines.

Management also makes assessment of its portfolio and creates additional provision to meet unforeseen contingencies.

10. Investments

In accordance with Accounting Standard (AS 13) on “Accounting for Investments” and the guidelines issued by the National Housing Bank, investments are either classified as current or long term based on management’s intention at the time of purchase. On initial recognition, all investments are measured at cost. The cost comprises of purchase price and directly attributable acquisition charges such as brokerage, fees and stamp duty.

Current Investments are stated at lower of cost and fair value. However provision for diminution in value of investment is made to recognize a decline in value other than temporary in nature.

On sale of an investment, the difference between its carrying value and net sale proceeds is charged or credited in the Statement of Profit and Loss.

11. Employee Benefits

a) Short Term Employee Benefits

Short Term Employee Benefits are recognized during the period when the services are rendered.

b) Post-Employment Benefits

Defined Contribution Plan-Provident Fund

The Company contributes to a Government administered Provident Fund in accordance with the provisions of Employees Provident Fund Act.

Defined Benefit Plan Gratuity:

The Company makes an annual contribution to Gratuity Fund administered by Trustees and managed by LIC.

12. Borrowing Costs

Borrowing costs include interest and other cost that the Company incurs in connection with the borrowing of funds. Other cost in connection with the borrowings are amortized to the Statement of Profit and Loss over the tenure of the loan.

13. Accounting For Taxes on Income

The accounting treatment for the Income Tax in respect of Company’s Income is based on the Accounting Standard on “Accounting for taxes on Income” (AS 22). Income tax expenses is the aggregate amount of current tax and deferred tax charge, taxes on income are accrued in the same period as the revenue and expenses to which they relate. Current Tax is determined in accordance with the Income Tax Act 1961, on the amount of tax payable in respect of income for the year.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences arising between the carrying value of assets and liabilities. Deferred tax assets are recognized only after giving due consideration to prudence. Deferred tax assets and liabilities are measured using tax retards and tax laws that have been enacted (or) substantially enacted by the balance sheet date.

Deferred Tax Liability on deduction claimed in earlier years u/s 36(1)(viii) of the Income Tax Act, 1961 has been provided in terms of National Housing Bank (NHB) policy circular.

14. Earnings Per Share

The Company reports basic and diluted earnings per equity share in accordance with (AS 20), Earnings per share issued by The Institute of Chartered Accountants of India. Basic earnings share have been computed by divided net income by the weighted average number of equity shares outstanding for the period. Diluted earnings per equity shares have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.

Earnings per share (EPS) is calculated as follows:

15. Goods and Service tax/Service Tax Input Credit

Goods and Service Tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is reasonable certainty in availing /utilising the credits.

16. Net Profit

The Company calculates Net Profit or Loss for the period and changes in accounting policies, if any, in accordance with (AS 5) issued by The Institute of Chartered Accountants of India and other applicable laws.

Aggregate number of shares allotted as fully paid-up by way of Bonus Shares (During 5 years immediately preceding March 31, 2018) :

During the year 2014-15, pursuant to approval of shareholders at the Extra-Ordinary General Meeting (EOGM) of SRG Housing Finance Limited held on May 12, 2014, the Company allotted 3,232,200 Bonus Equity Shares of Rs. 10/- each fully paid up shares in the proportion oRs. 2:5 i.e. two shares for every five shares held.

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Mar 31, 2016

1. Basis of preparation

The financial statements are prepared and presented under the historical cost convention in accordance with the Generally Accepted Accounting Principles (GAAP), and provisions referred to Sec 133 of the Companies Act, 2013 and accounting standards issued by the Institute of Chartered Accountants of India (ICAI) as Applicable. The Company also follows the directions prescribed by the National Housing Bank (NHB) for housing finance Companies.

2. Income Recognition

Interest income on housing / other loans and other dues are accounted on accrual basis. Housing / other loans are classified into "Performing and non- performing assets in terms of the directions issued by the NHB from time to time". Income recognition on non-performing advances are made in accordance with the NHB guidelines. Fees and additional interest income on delayed EMI/Pre-EMI are recognized on receipt basis.

3. Interest on Housing Loans

Repayment of the Housing Loans is by way of equated monthly installments (EMIs) comprising principal and interest. The interest is calculated on the outstanding balances at the beginning of the month. EMIs commence once the entire loan is disbursed. Pending commencement of EMI, pre-equated monthly installment interest (PEMI) is payable every month.

4. Income from Investment

Dividend Income on investments is recognized when the right to receive the same is established.

5. Fixed Assets and Depreciation

Fixed Assets are stated at cost, Depreciation on fixed assets is provided on pro-rata basis on "Written Down Value Method" from the date of installation based on life assigned to each asset in accordance with Schedule II of the Companies Act, 2013.

6. Provision on Non-Performing Assets & for diminution in investment value

Non-performing assets are identified and categorized into Sub-standard, Doubtful and Loss Category based on the guidelines and direction issued by NHB. Provisions for non-performing assets and for diminution in investment value are made in the accordance with the NHB guidelines.

7. Investments

In accordance with Accounting Standard (AS 13) on "Accounting for Investments" and the guidelines issued by the National Housing Bank, Investments are either classified as current or long term based on management''s intention at the time of purchase. On initial recognition, all investments are measured at cost. The cost comprises of purchase price and directly attributable acquisition charges such as brokerage, fees and stamp duty.

Current Investments are stated at lower of cost and fair value. However Provision for diminution in value of investment is made to recognize a decline in value other than temporary in nature.

On sale of an investment, the difference between its carrying value and net sale proceeds is charged or credited in the statement of profit and loss.

8. Retirement Benefits :-

Liability for employee benefits, both short and long term, for present and past services which are due as per terms of employment are recorded in accordance with Accounting Standard (AS) 15 "Employee Benefits" as notified by the Companies (Accounting Standards)Rules,2006.

i) Gratuity

The management is of the opinion that since none of the employees of the company were in continuous service as provided in the act accordingly making provision of the gratuity does not arise. However, if payment on account of gratuity arises due to happening of any incidents as provided under the applicable provisions of the law, the same will be accounted for on cash basis.

ii) Pension

The management is also of the opinion that the payment under Pension Act is not applicable to the Company.

9. Accounting For Taxes On Income

Income tax expenses is the aggregate amount of current tax and deferred tax charge, Taxes on income are accrued in the same period as the revenue and expenses to which they relate. Current Tax is determined in accordance with the income Tax Act 1961, on the amount of tax payable in respect of income for the year.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences arising between the carrying value of assets and liabilities. Deferred tax assets are recognized only after giving due consideration to prudence. Deferred tax assets and liabilities are measured using tax retards and tax laws that have been enacted (or) substantially enacted by the balance sheet date.

10. Earnings Per Share

The Company reports basic and diluted earnings per equity share in accordance with (AS) 20, Earnings per share issued by the Institute of Chartered accountants of India. Basic earnings share have been computed by divided net income by the weighted average number of equity shares outstanding for the period. Diluted earnings per equity shares have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.

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Mar 31, 2015

1. Basic of preparation The financial statements are prepared and presented under the historical cost convention in accordance with the Generally Accepted Accounting Principles (GAAP), and provi- sions referred to Sec 133 of the Companies Act, 2013, and accounting standards issued by the Institute of Chartered Accountants of India (ICAI) as Applicable. The Company also follows the directions pre- scribed by the National Housing Bank (NHB) for housing finance Companies.

2. Income Recognition Interest income on housing / other loans and other dues are accounted on ac- crual basis. Housing / other loans are classified into "Performing and non- performing assets in terms of the directions issued by the NHB from time to time". Income recognition on non-performing advances are made in accordance with the NHB guidelines. Fees and additional interest income on delayed EMI/ Pre-EMI are recognized on receipt basis.

3. Interest on Housing Loans Repayment of the Housing Loans is by way of equated monthly install- ments (EMIs) comprising principal and interest. The interest is calculated on the outstanding balances at the beginning of the month. EMI's commence once the entire loan is disbursed. Pending commence- ment of EMI, pre-equated monthly installment interest (PEMI) is payable every month.

4. Fixed Assets and Depreciation Fixed Assets are stated at cost, Depreciation on fixed assets is provided on pro-rata basis on "Written Down Value Method" from the date of installation based on life assigned to each asset in accordance with Schedule II of the Companies Act, 2013.

5. Provision on Non-Performing Assets Non- performing assets are identified and categorized into Sub-standard, Doubtful and Loss Category based on the guidelines and direction issued by NHB. Provi- sions for non-performing assets are made in the accordance with the said guidelines.

6. Investments The Company do not have Investments

7. Retirement Benefits :-Liability for employee benefits, both short and long term, for present and past services which are due as per terms of employment are recorded in accordance with Accounting Standard (AS) 15 "Employee Benefits" as notified by the Companies (Accounting Standards) Rules,2006.

(i). Gratuity The management is of the opinion that since none of the employees of the company were in continuous service as provided in the act accordingly making provision of the gratuity does not arise. However, if payment on account of gratuity arises due to happening of any incidents as provided under the applicable provisions of the law, the same will be accounted for on cash basis.

ii) Pension :

The management is also of the opinion that the payment under Pension Act is not applicable to the Company

8. Accounting For Taxes On Income

Income tax expenses is the aggregate amount of current tax and deferred tax charge, Taxes on in- come are accrued in the same period as the revenue and expenses to which they relate. Current Tax is determined in accordance with the income Tax Act 1961, on the amount of tax payable in respect of income for the year.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differ- ences arising between the carrying value of assets and liabilities. Deferred tax assets are recognized only after giving due consideration to prudence. Deferred tax assets and liabilities are measured us- ing tax retards and tax laws that have been enacted (or) substantially enacted by the balance sheet date.

9. Earnings Per Share

The Company reports basic and diluted earnings per equity share in accordance with (AS) 20, Earnings per share issued by the Institute of Chartered accountants of India. Basic earnings share have been computed by divided net income by the weighted average number of equity shares outstanding for the period. Diluted earnings per equity shares have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.

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Mar 31, 2014

1. Basic of preparation

The financial statements are prepared and presented under the historical cost convention in accordance with the Generally Accepted Accounting Principles (GAAP), and provisions of the Companies Act, 1956 and accounting standards issued by the Institute of Chartered Accountants of India (ICAI) as Applicable. The Company also follows the directions prescribed by the National Housing Bank (NHB) for housing finance Companies.

2. Income Recognition

Interest income on housing / other loans and other dues are accounted on accrual basis. Housing / other loans are classified into "Performing and non-performing assets in terms of the directions issued by the NHB from time to time". Income recognition on non-performing advances are made in accordance with the NHB guidelines. Fees and additional interest income on delayed EMI/Pre-EMI are recognized on receipt basis.

3. Interest on Housing Loans

Repayment of the Housing Loans is by way of equated monthly installments (EMIs) comprising principal and interest. The interest is calculated on the outstanding balances at the beginning of the month. EMI''s commence once the entire loan is disbursed. Pending commencement of EMI, pre-equated monthly installment interest (PEMI) is payable every month.

4. Fixed Assets And Depreciation

a. Fixed Assets are stated at cost, Depreciation on fixed assets is provided on pro-rata basis from the date of installation on written down value method in accordance with Schedule XIV of the Companies Act, 1956.

b. Assets costing till 5000 are being depreciated fully in the year of acquisition.

5. Provision on Non-Performing Assets

Non-performing assets are identified and categorized into Sub-standard, Doubtful and Loss Category based on the guidelines and direction issued by NHB. Provisions for non-performing assets are made in the accordance with the said guidelines.

6. Investments

The Company do not have Investments.

7. Retirement Benefits

Liability for employee benefits, both short and long term, for present and past services which are due as per terms of employment are recorded in accordance with Accounting Standard (AS) 15 "Employee Benefits" as notified by the Companies (Accounting Standards) Rules, 2006.

I) Gratuity: The management is of the opinion that since none of the employees of the company were in continuous service of more than five years and accordingly making provision of the gratuity does not arise. However, if payment on account of gratuity arises due to happening of any incidents as provided under the applicable provisions of the law, the same will be accounted for on cash basis.

ii) Pension: The management is also of the opinion that the payment under Pension Act is not applicable to the Company

8. Accounting For Taxes On Income

Income tax expenses is the aggregate amount of current tax and deferred tax charge, Taxes on income are accrued in the same period as the revenue and expenses to which they relate. Current Tax is determined in accordance with the income TaxAct 1961, on the amount of tax payable in respect of income for the year.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences arising between the carrying value of assets and liabilities. Deferred tax assets are recognized only after giving due consideration to prudence. Deferred tax assets and liabilities are measured using tax retards and tax laws that have been enacted (or) substantially enacted by the balance sheet date.

9. Earnings Per Share

The Company reports basic and diluted earnings per equity share in accordance with (AS) 20, Earnings per share issued by the Institute of Chartered accountants of India. Basic earnings share have been computed by dividend net income by the weighted average number of equity shares outstanding for the period. Diluted earnings per equity shares have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.

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Mar 31, 2013

1. Basic of preparation

The financial statements are prepared and presented under the historical cost convention in accordance with the Generally Accepted Accounting Principles (GAAP), and provisions of the Companies Act, 1956 and accounting standards issued by the Institute of Chartered Accountants of India (ICAI) as Applicable. The Company also follows the directions prescribed by the National Housing Bank (NHB) for housing finance Companies.

2. Income Recognition

Interest income on housing / other loans and other dues are accounted on accrual basis. Housing / other loans are classified into "Performing and non-performing assets in terms of the directions issued by the NHB from time to time". Income recognition on non-performing advances are made in accordance with the NHB guidelines.

3. Interest on Housing Loans

Repayment of the Housing Loans is by way of equated monthly installments (EMIs) comprising principal and interest. The interest is calculated on the outstanding balances at the beginning of the month. EMI''s commence once the entire loan is disbursed. Pending commencement of EMI, pre-equated monthly installment interest (PEMI) is payable every month.

4. Fixed Assets And Depreciation

a. Fixed Assets are stated at cost, Depreciation on fixed assets is provided on pro-rata basis from the date of installation on written down value method in accordance with Schedule XIV of the Companies Act, 1956.

b. Assets costing till 5000 are being depreciated fully in the year of acquisition.

5. Provision on Non-Performing Assets

Non-performing assets are identified and categorized into Sub-standard, Doubtful and Loss Category based on the guidelines and direction issued by NHB. Provisions for non-performing assets are made in the accordance with the said guidelines.

6. Investments

The Company do not have Investments

7. Retirement Benefits :-

Liability for employee benefits, both short and long term, for present and past services which are due as per terms of employment are recorded in accordance with Accounting Standard (AS) 15 "Employee Benefits" as notified by the Companies (Accounting Standards) Rules, 2006.

i) Gratuity

The management is of the opinion that since none of the employees of the company were in continuous service of more than five years an d accordingly making provision of the gratuity does notarise. However, if payment on account of gratuity arises due to happening of any incidents as provided under the applicable provisions of the law, the same will be accounted for on cash basis.

ii) Pension

The management is also of the opinion that the payment under Pension Act is not applicable to the Company

8. Accounting For Taxes On Income

Income tax expenses is the aggregate amount of current tax and deferred tax charge, Taxes on income are accrued in the same period as the revenue and expenses to which they relate. Current Tax is determined in accordance with the income Tax Act 1961, on the amount of tax payable in respect of income for the year.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences arising between the carrying value of assets and liabilities. Deferred tax assets are recognized only after giving due consideration to prudence. Deferred tax assets and liabilities are measured using tax retards and tax laws that have been enacted (or) substantially enacted by the balance sheet date.

9. Earnings Per Share

The Company reports basic and diluted earnings per equity share in accordance with (AS) 20, Earnings per share issued by the Institute of Chartered accountants of India. Basic earnings share have been computed by dividend net income by the weighted average number of equity shares outstanding for the period. Diluted earnings per equity shares have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the period.