A. Significant Accounting Policies
1. Basis of accounting:-
1.1 Corporate Information: Ajwa Fun World and Resorts Ltd ('the Company') is a listed public limited
company domiciled and incorporated in India. The registered office of the Company is located at A -
Tower, 1st Floor, Kunj-Resi-Cum Plaza, Palace Road, Vadodara, Gujarat, India - 390001. Its Equity
Shares are listed on the main boards of BSE Limited with effect from 14th November 1994, The
Company was a pioneer in Amusement industry, water park, resort, party plots in Gujarat and has
been loved by three generation since 32 years.
These financial statements have been prepared in accordance with the Generally Accepted
Accounting Principles in India (Indian GAAP) including the Accounting Standards notified under
Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014
and the relevant provisions of the Companies Act, 2013.
The financial statements have been prepared under the historical cost convention on accrual basis.
2. Use of Estimates
The preparation of financial statements in conformity with Indian GAAP requires the management
to make judgments, estimates and assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting
period. Although these estimates are based on the management's best knowledge of current events
and actions, uncertainty about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.
3. Revenue Recognition: -
Expenses and Income considered payable and receivable respectively are accounted for on accrual
basis.
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the
Company and the revenue can be reliably measured.
4. Property, Plant & Equipment :-
Property, Plant & Equipment including intangible assets are stated at their original cost of
acquisition including taxes, freight and other incidental expenses related to acquisition and
installation of the concerned assets less depreciation till date.
Company has adopted cost model for all class of items of Property Plant and Equipment.
5. Depreciation :-
Depreciation on Fixed Assets is provided to the extent of depreciable amount on the Written down
Value (WDV) Method/SLM method. Depreciation is provided based on useful life of the assets as
prescribed in Schedule II to the Companies Act, 2013.
Depreciation on assets acquired during the year is recognized on a pro-rata basis to the statement
of profit and loss till the date of sale.
The carrying amount of assets is reviewed at each balance sheet date if there is any indication of
impairment based on internal/external factors. An impairment loss is recognized wherever the
carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater
of the assets, net selling price and value in use. In assessing value in use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and risks specific to the asset.
After impairment, depreciation is provided on the revised carrying amount of the asset over its
remaining useful life.
6. Foreign currency Transactions: -
Transactions arising in foreign currencies during the year are converted at the rates closely
approximating the rates ruling on the transaction dates. Liabilities and receivables in foreign
currency are restated at the year-end exchange rates. All exchange rate differences arising from
conversion in terms of the above are included in the statement of profit and loss.
7. Investments :-
Investments, which are readily realizable and intended to be held for not more than one year from
the date on which such investments are made, are classified as current investments. All other
investments are classified as non-current investments.
On disposal of an investment, the difference between its carrying amount and net disposal proceeds
is charged or credited to the statement of profit and loss.
8. Inventories :-
Inventories are valued as under:-
1. Inventories : Lower of cost(FIFO/specific cost/Weighted avg) or net realizable value
2. Scrap : At net realizable value.
9. Borrowing cost:-
Borrowing costs that are attributable to the acquisition or construction of the qualifying assets are
capitalized as part of the cost of such assets. A qualifying assets is one that necessarily takes a
substantial period of time to get ready for its intended uses or sale. All other borrowing costs are
charged to revenue in the year of incurrence.
10. Retirement Benefits:-
The retirement benefits are accounted for as and when liability becomes due for payment.
11. Taxes on Income:-
Provision for current tax is made on the basis of estimated taxable income for the current
accounting year in accordance with the Income Tax Act, 1961. The deferred tax for timing
differences between the book and tax profits for the year is accounted for, using the tax rates and
laws that have been substantively enacted by the balance sheet date. Deferred tax assets arising
from timing differences are recognized to the extent there is virtual certainty with convincing
evidence that these would be realized in future. At each Balance Sheet date, the carrying amount of
deferred tax is reviewed to reassure realization.
No provision of tax as required by AS-22 issued by the Institute of Chartered Accountants of India
has been made due to uncertainty that sufficient taxable income against which such deferred tax
assets can be realized. The impact of same has also not been determined.
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