Note 1: Significant Accounting Policies
Basis of preparation:
The financial statements of the company have been prepared in accordance with
Indian Accounting Standards (Ind AS’) notified under the Companies (Indian
Accounting Standards) Rules, 2015 as amended by the Companies (Indian
Accounting Standards) (Amendment) Rules, 2016and other relevant provisions of
the Act and the relevant provisions of the Companies Act, 2013. The financial
statements have been prepared on an accrual basis and under the historical cost
convention. The accounting policies adopted in the preparation of financial
statements are consistent with those of previous year.
Use of Estimates:
The preparation of financial statements in conformity with Indian Accounting
Standards (Ind AS’) requires the management to make judgments, estimates and
assumptions that affect the reported amounts of revenue, 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.
Revenue Recognition:
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. Although in
current year company does not have revenue.
Taxation:
Since a company is incurring a profit Provision for current tax is made after
taking into consideration benefits admissible under the provisions of the Income-
tax Act, 1961.
Also Deferred Tax for timing difference between profits and book profits is
accounted for, using tax rates and laws that have been enacted or substantially
is not enacted as of the Balance Sheet Date. Deferred Tax Assets/Liabilities are
recognized to the extent there is reasonable certainty that these assets/liabilities
can be realised/ accrued in future.
Fixed Asset:
Property, plant and equipment are valued at cost of acquisition or construction
less accumulated depreciation and impairment loss. The Company capitalises all
costs relating to the acquisition, installation and construction of property, plant
and equipment. Subsequent costs are included in the asset’s carrying amount or
recognised as separate asset, as appropriate, only when it is probable that
future economic benefits associated with the item will flow to the Company. All
other repair and maintenance costs are recognized instatement of profit or loss
as incurred.
Depreciation is provided on the assets on their original costs up to their net
residual value estimated at 5% of the original cost, prorata to the period of use
on the written down value method, over their estimated useful life.
The residual values, useful lives and method of depreciation are reviewed at the
end of each financial year.
Inventories:
Inventories are valued at cost or net realizable value, whichever is lower.
Moreover, inventories are certified by the management and same is incorporated
in financial statement of accounts.
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