1. Significant Accounting Policies
1.1 Basis of Preparation of Financial Statements
These financial statements have been prepared in accordance with the Indian Accounting Standards (‘Ind AS”) notified notified under the Companies (Indian Accounting Standards) Rules, 2015 , Companies (Indian Accounting Standards) Amendment Rules, 2016 (to the extent notified and applicable) and the guidelines issued by the Reserve Bank of India as applicable to a Non-banking Finance Company. Up to the year ended March 31, 2017, the Company prepared its financial statements in accordance with the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006. These are the company’s first Ind AS financial statements. The date of transition to Ind AS is April 1st, 2016. In accordance with Ind AS 101 First-time Adoption of Indian Accounting Standard, the Company has presented a reconciliation under Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (“Previous GAAP” or “Indian GAAP”) to Ind AS.
The financial statements have been prepared under the historical cost convention and on accrual basis, unless otherwise stated. The financial statements are presented in Indian rupees.
1.2 Revenue Recognistion
The Company recognises income on accrual basis. However where the ultimate collection of the same lacks reasonable certainty, revenue recognition is postponed to the extent of uncertainty.
1.3 Property, Plant & Equipment
Fixed Assets are stated at cost less accumulated depreciation and impairment loss, if any. Depreciation on fixed assets is provided on SLM at the rates and in the manner prescribed in the Schedule II of the Companies Act, 2013.
The details of estimated life for each category of asset are as under:
Intangible Asswts (Goodwill) — 5 years
1.4 Investments
Long-term Investments are carried at acquisition cost. Investments intended to be held for less than one year are classified as ‘Current Investments’ and carried at lower of cost and net realizable value. Provision for diminution in value is made if the decline in value is other than temporary in nature in the opinion of the management.
Investment in shares of Kaushalya Infrastructure Development Corporation Limited and Prabhat Telecoms (India) Limited are converted into Inventory (Stock in trade). Further value of these shares are taken at their prevalent market price on the relevant date.
1.5 Taxes on Income
Provision for Income Tax is made on the basis of estimated taxable income for the period at current rates. Tax expense comprises both Current Tax and Deferred Tax at the applicable enacted or substantively enacted rates. Current Tax represents the amount of Income Tax payable/ recoverable in respect of taxable income/ loss for the reporting period. Deferred Tax represents the effect of timing difference between taxable income and accounting income for the reporting period that originates in one year and are capable of reversal in one or more subsequent years.
1.6 Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement are recognised 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 Liabilities are not recognised but are disclosed in the Notes. Contingent Assets are neither recognised nor disclosed in the financial statements.
1.7 Inventory
Inventory cost includes cost of purchase and other costs incurred in bringing the inventories to their present condition. Inventories have been valued at lower of Cost or NRV.
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