NOTE: 2 SIGNIFICANT ACCOUNTING POLICIES:
a) BASIS OF PREPARATION:
Statement of Compliance:
These financial statements have been prepared in accordance with Indian Accounting Standards
('Ind AS') as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section
133 of the Companies Act, 2013 ('the Act') read with Rule 3 the Companies (Indian Accounting
Standards) Rules, 2015 and the Companies (Indian Accounting Standards) Amendment Rules, 2016,
guidelines issued by the Securities and Exchange Board of India ('SEBI') and other relevant
provisions of the Companies Act, 2013.
Details of the Company's accounting policies are included in paragraphs b to k.
Functional and presentation currency
These financial statements are presented in Indian Rupees ("INR") which is also the Company's
functional currency.
These financial statements have been prepared on the historical cost basis and an accrual basis,
except for certain financial instruments which are measured at fair values at the end of each
reporting period, as explained in the accounting policies below. Historical cost is generally based on
the fair value of the consideration given in exchange for goods and services.
In estimating the fair value of an asset or liability, the Company takes into account the
characteristics of the asset or liability that market participants would take into account when
pricing the asset or liability at the measurement date. Fair value for measurement and/ or disclosure
purpose in these financial statements is determined on such a basis, except for share-based payment
transactions that are within the scope of Ind AS 102 Share-based Payments, leasing transactions that
are within the scope of Ind AS 17 Leases, and measurements that have some similarities to fair
value but are not fair value, such as 'value in use, in Ind AS 36 Impairment of assets.
b) USE OF ESTIMATES:
The preparation of financial statements requires the management of the Company to make
estimates and assumptions that affect the reported balances of assets and liabilities and disclosures
relating to contingent liabilities on the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Though management believes that the
estimates used are prudent and reasonable, actual results could differ from these estimates.
Differences between the actual results and estimates are recognized in the period in which the
results are known or materialized.
c) RECOGNITION OF INCOME AND EXPENDITURE:
The Company follows the percentage of completion method, based on the stage of completion as at
the Balance Sheet date, taking into account the contractual price and revision thereto by estimating
total revenue including claims/variations as per Ind AS 11 and total cost till completion of the
contract and the profit so determined proportionate to the percentage of the actual work done.
Revenue is recognized as follows:
a) In case of item rate contracts based on physical measurement of work actually completed, at the
Balance Sheet date.
b) In the case of Lump sum contracts revenue is recognized on completion of milestones as specified
in the contract or as identified by the management. Foreseeable losses are accounted for as and when
they are determined except to the extent they are expected to be recovered through claims presented
to the customers or in arbitration.
C) Revenues/Incomes and Costs/Expenditure are generally accounted for on accrual, as they are
earned or incurred.
d) Sale of goods is recognized on the transfer of property in goods or on the transfer of significant
risks and reward of ownership to the buyer, which is generally on the dispatch of goods.
d) PROPERTY, PLANT & EQUIPMENT AND INTANGIBLE ASSETS (FIXED ASSETS AND
DEPRECIATION):
Property, Plant & Equipment and intangible assets are stated at cost less accumulated
depreciation/amortization and net of impairment. The cost of an item of property, plant and
equipment comprises its purchase price, including import duties and non-refundable purchase taxes,
after deducting trade discounts and rebates, any directly attributable costs of bringing the item to its
working condition for its intended use and estimated cost of dismantling and removing the item and
restoring the site on which it is located. Subsequent expenditure relating to property, plant and
equipment is capitalized only when it is probable that future economic benefits associated with these
will flow to the company and the cost of the item can be measured reliably.
The cost of property, plant and equipment not available for use at each reporting date is disclosed
under capital work in progress.
The depreciable amount for assets is the cost of an asset, less its estimated residual value. Any gain
or loss arising on the disposal or retirement of an item of Property, Plant & Equipment and
intangible assets is determined as the difference between the sales proceeds and the carrying amount
of the asset and is recognized in profit or loss.
When the use of property changes from owner-occupied to investment property, the property is
reclassified as an investment property at its carrying amount on the date of reclassification.
e) VALUATION OF INVENTORIES:
Construction/development material is valued at cost value.
Work in progress is valued at cost plus actual overhead incurred.
Inventories are stated at the lower cost (determined using the First-in-first-out method) & net
realizable value. The costs comprise its purchase price & any directly attributable cost of bringing the
inventories to its present location & condition. Net realizable value is the estimated selling price in
the ordinary course of business less the estimated cost necessary to make a sale.
f) PRELIMINARY EXPENSES:
Preliminary expenses in the nature of expenses for incorporation of the Company, public issue
expenses and like expenses; are amortized over a period of five years.
g) IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS:
At each Balance Sheet date, the Company reviews the carrying amount of its assets to determine
whether there is any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order to determine the extent of
impairment loss and provide for impairment. Where the impairment loss subsequently reverses, the
carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been recognized for the asset in prior
accounting periods.
h) INVESTMENTS:
Current investments are carried at a lower of cost and quoted / fair value. Long-term investments
are stated at cost. Provision for diminution in the value of long-term investments is made only if
such a decline is other than temporary in the opinion of the management.
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