i) Basis of accounting and preparation of financial statements
The financial statements are prepared under the historical cost convention on an accrual basis in
accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) and
Accounting Standards (AS) under Section 133 of the Companies Act, 2013 (“the Act”) read with Rule
7 of the Companies (Accounts) Rules, 2014, as amended. These financial statements have been
prepared on a going concern basis and the accounting policies have been consistently applied by the
company.
All assets and liabilities have been classified as current or non-current as per the Company's normal
operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on
the nature of the services and the time between the provision of services and their realization in cash
and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose
of current and non-current assets classification of assets and liabilities.
ii) Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and the disclosure of contingent assets and liabilities, if any, on the date of the financial
statements and the results of operations during the reporting periods. Although these estimates are
based upon management’s knowledge of current events and actions, actual results could differ from
those estimates and revisions, if any, are recognized in the current and future periods.
iii) Cash and cash equivalents
Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term
balances (with an original maturity of three months or less from the date of acquisition), highly liquid
investments that are readily convertible into known amounts of cash and which are subject to
insignificant risk of changes in value.
iv) Revenue recognition
• Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
Company, the revenue can be reliably measured and there is certainty of ultimate collection.
• Interest income is recognized on accrual basis. Other income is accounted when the right to receive
it is established.
v) Investments
Investments are classified as non-current or current investments, based on management's intention.
Investments that are readily realizable and intended to be held not more than a period are classified
as current investments. All other investments are classified as non-current investments.
vi) Taxes
• Current tax is determined as the tax payable in respect of taxable income for the year and is computed
in accordance with relevant tax regulations.
• Deferred tax resulting from timing differences between book and tax profits is accounted for at the
current rate of tax or substantively enacted tax rates at the balance sheet date, as applicable, to the
extent that the timing differences are expected to crystallize.
• Deferred Tax Assets are recognized where realization is reasonably certain. In case of carried
forward losses or unabsorbed depreciation, deferred tax assets are recognized only if there is a virtual
certainty of realization supported by convincing evidence. Deferred Tax Assets are reviewed for the
appropriateness of their respective carrying values at each balance sheet date.
vii) Borrowing Costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are
capitalized as part of the cost of such assets in accordance with notified Accounting Standard 16
“Borrowing costs”. A qualifying asset is one that necessarily takes substantial period of time to get
ready for its intended use. All other borrowing costs are charged to the Statement of Profit and Loss
as incurred.
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