Magnanimous Trade & Finance Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

Mar 31, 2025

1. Corporate Information

Magnanimous Trade & Finance Limited ("the Company”) was incorporated as a public company limited by shares on July23^rd, 1985. The Company obtained permission from the Reserve Bank of India for carrying on the business of Non-Banking Financial Institution on 02-05-1998 vide Regn No. 05.01962. The Company is registered as a Non-Deposit Taking Company. The Registered Office of the Company is Ground Floor, Shop No. 188/2, Shyam Dham Heights, Rampura, Patrakar Colony, Jaipur Rajasthan 302020, Rajasthan, India.

The equity shares of the Company are listed on BSE Limited from April17^th, 1986, delisted in 2001 and again relisted on June 17^th, 2013.

2. Basis of preparation and presentation 2.1 Statement of Compliance

The standalone financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind-AS) notified under Section 133 of the Companies Act, 2013 (the ''Act'') [Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time)]. These financial statements may require further adjustments, if any, necessitated by the guidelines / clarifications / directions issued in the future by RBI, Ministry of Corporate Affairs, or other regulators, which will be implemented as and when the same are issued and made applicable.

2.22 Basis of measurement

The standalone financial statements have been prepared on a historical cost basis, except for following assets and liabilities which have been measured at fair value:

i. fair value through other comprehensive income (FVOCI) instruments,

ii. other financial assets held for trading,

iii. financial assets and liabilities designated at fair value through profit or loss (FVTPL)

2.23 The financial statements of the Company are presented as per Schedule III (Division III) of the Companies Act, 2013 applicable to NBFCs, as notified by the Ministry of Corporate Affairs (MCA). Financial assets and financial liabilities are generally reported on a gross basis except when, there is an unconditional legally enforceable right to offset the recognised amounts without being contingent on a future event and the parties intend to settle on a net basis.

2.24 Functional and presentation currency

The financial statements are presented in Indian Rupees (INR) which is also its functional currency and all values are rounded to the nearest hundreds, except when otherwise indicated.

3. Material accounting policies

3.1. Recognition of interest income

The Company recognises interest income by applying the effective interest rate (EIR) to the gross carrying amount of a financial asset and as per year to year financial contracts as agreed by the management.

3.2. Recognition of revenue from sale of goods

Revenue (other than for Financial Instruments within the scope of Ind-AS 109) is measured at an amount that reflects the considerations, to which an entity expects to be entitled in exchange for transferring goods or services to customer, excluding amounts collected on behalf of third parties.

The Company recognises revenue from contracts with customers based on a five-step model as set out in Ind-AS 115:

Step 1: Identify contract(s) with a customer: A contract is defined as an agreement between two or more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.

Step 2: Identify performance obligations in the contract: A performance obligation is a promise in a contract with a customer to transfer a good or service to the customer.

Step 3: Determine the transaction price: The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.

Step 4: Allocate the transaction price to the performance obligations in the contract: For a contract that has more than one performance obligation, the Company allocates the transaction price to each performance obligation in an amount that depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each performance obligation.

Step 5: Recognise revenue when (or as) the Company satisfies a performance obligation. Revenue from contract with customer for rendering services is recognised at a point in time when performance obligation is satisfied.

3.2.1. Recognition of Dividend Income

Dividend Income (including from FVOCI investments) is recognised when the Company''s right to receive the payment is established. This is established when it is probable that the economic benefits associated with the dividend will flow to the entity and the amount of dividend can be measured reliably.

3.3. Financial instruments A. Financial Assets3.3.1. Initial recognition and measurement

All financial assets are recognised initially at fair value when the parties become party to the contractual provisions of the financial asset. In case of financial assets which are not recorded at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial assets, are adjusted to the fair value on initial recognition.

3.3.2. Subsequent measurement

The Company classifies its financial assets into various measurement categories. The classification depends on the contractual terms of the financial assets'' cash flows and the Company''s business model for managing financial assets.

a. Financial assets measured at amortised cost

A financial asset is measured at Amortised Cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the Financial Asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

b. Financial assets measured at fair value through other comprehensive income (FVOCI)

A financial asset is measured at FVOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and contractual terms of financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

c. Financial assets measured at fair value through profit or loss (FVTPL)

A financial asset which is not classified in any of the above categories are measured at FVTPL.

3.3.3. Investment in Associates

Investments in associate companies are carried at cost and fair value (deemed cost) as per Ind-AS-101 less accumulated impairment losses, if any. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. On disposal of investments in associate companies, the difference between net disposal proceeds and the carrying amounts are recognised in the Statement of Profit and Loss.

3.3.4. Equity Investments

Equity instruments are instruments that meet the definition of equity from the issuer''s perspective; that is, instruments that do not contain a contractual obligation to pay and that evidence a residual interest in the issuer''s net assets.

The company subsequently measures all equity investments at fair value. Where the company''s management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the de-recognition of the investment.

B. Financial liabilities3.3.5. Initial recognition and measurement

All financial liabilities are recognized initially at fair value and, in the case of borrowings and payables, net of directly attributable transaction costs.

3.3.6. Subsequent Measurement

Financial liabilities are subsequently carried at amortized cost using the effective interest method.

3.4. De-recognition of financial assets and liabilities3.4.1. Financial Asset

The Company derecognizes a financial asset when the contractual cash flows from the asset expire or it transfers its rights to receive contractual cash flows from the financial asset in a transaction in which substantially all the risks and rewards of ownership are transferred.

Any interest in transferred financial assets that is created or retained by the Company is recognized as a separate asset or liability.

3.4.2. Financial Liability

A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as de-recognition of the original liability and the recognition of a new liability. The difference between the carrying value of the original financial liability and the consideration paid is recognised in profit or loss.

3.5. Offsetting

Financial assets and financial liabilities are generally reported gross in the balance sheet. Financial assets and liabilities are offset and the net amount is presented in the balance sheet when the Company has a legal right to offset the amounts and intends to settle on a net basis or to realise the asset and settle the liability simultaneously in all the following circumstances:

a. The normal course of business

b. The event of default

c. The event of insolvency or bankruptcy of the Company and/or its counterparties

3.6. Impairment of financial assets

In accordance with Ind-AS 109, the Company uses ‘Expected Credit Loss'' model (ECL), for evaluating impairment of financial assets other than those measured at Fair value through profit and loss.

The measurement of ECL reflects:

• An unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;

• The time value of money; and

• Reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

The measurement of ECL allowance is an area that requires the use of complex models and significant assumptions about future economic conditions and credit behaviour.

3.6.1. Write-off policy

The company writes off financial assets, in whole or in part, when it has exhausted all practical recovery efforts and has concluded there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include (i) ceasing enforcement activity and (ii) where the company''s recovery method is foreclosing on collateral and the value of the collateral is such that there is no reasonable expectation of recovering in full.

3.7. Determination of fair value of Financial Instruments

The Company measures financial instruments, such as, investments at fair value at each balance sheet date. value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

i. In the principal market for the asset or liability, or

ii. In the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by the Company. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

3.8. Cash and cash equivalents

Cash and cash equivalents comprise of cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short- term deposits, as defined above, net of outstanding bank overdrafts if any, as they are considered an integral part of the Company''s cash management.

3.9. Property, plant and equipment

All items of property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and he cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

3.9.1. Depreciation

Depreciation on Property, Plant and Equipment is calculated using written down value method (WDV) to write down the cost of property and equipment to their residual values over their estimated useful lives which are in line with the estimated useful life as specified in Schedule II of the Companies Act, 2013.

The estimated useful lives are as follows:

Particulars Useful life

Furniture and fixture 10 years

Office equipment 15 years

Computer 3 years

Vehicles 15 years

Plant & Machinery 15 years

The company provides pro-rata depreciation from the day the asset is put to use and for any asset sold, till date of sale. The asset''s residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposal are determined by comparing proceeds with carrying amount and are recognised in the statement of profit and loss.

3.10. Impairment of non-financial assets: Property, Plant and Equipment

The Company assesses, at each reporting date, whether there is any indication that any Property, Plant and Equipment or group of assets called Cash Generating Units (CGU) maybe impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount to determine the extent of impairment, if any.

An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

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 the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.

An assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset''s or CGU''s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last impairment loss was recognised.

The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.

Such reversal is recognised in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.

3.11. Investment Property

An investment property is accounted for in accordance with cost model. Depreciation on Property, Plant and Equipment is provided in accordance with the provisions of Schedule II of the Companies Act, 2013.

3.12. Inventories

The company has two categories of assets as mentioned hereunder:

• Stock of shares: These are valued at cost.

• Stock of Real Estate: These are valued on the basis of cost or net realized value, whichever is lower.

3.13. Borrowing Costs

Borrowing Costs, which are directly attributable to the acquisition / construction of fixed assets, till the time such assets are ready for intended use, are capitalised as part of the cost of the assets. Other borrowing costs are recognised as an expense in the year in which they are incurred. Brokerage costs directly attributable to a borrowing are expensed over the tenure of the borrowing.

3.14. Provisions, contingent liabilities and contingent assets

The Company creates a provision when there is a present obligation as a result of past events and it is probable that there will be outflow of resources and a reliable estimate of the obligation can be made of the amount of the obligation. Contingent liabilities are not recognised but are disclosed in the notes to the Standalone Ind-AS financial statements. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised nor disclosed in the Standalone Ind-AS financial statements.

3.15. Employee Benefits Expenses3.15.1. Short Term Employee Benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees render the services.

3.15.2. Post-Employment Benefits A. Defined Benefit schemes Leave Encashment

The company has not provided leave encashment as the employees are not entitled for that due to availment of leaves & there are no pending dues in this account.

Provident Fund

The company has not provided the provident Fund & ESI as the company is not covered under E.P.F. & ESI Act.

Gratuity

The Company provides for gratuity covering eligible employees under which a lump sum payment is paid to vested employees at retirement, death, incapacitation or termination of employment, of an amount reckoned on the respective employee''s salary and his tenor of employment with the Company.

The provision of gratuity is being made on the basis of 15 days salary of completed years of service of employees. The management does not see any need of actuarial valuation of the same as the numbers of employees are very few.

3.16. Taxes

Income tax expense represents the sum of current tax and deferred tax 3.16.1 Current Tax

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Minimum Alternative Tax (MAT) credit entitlement is recognised when there is convincing evidence that the same can be realised in future.

3.16.2 Deferred tax

The recognition of deferred tax assets is based upon whether it is more likely that not that sufficient and suitable taxable profit will be available in the future against which the temporary differences can be deducted. To determine the future taxable profits, reference is made to the latest available profit forecasts. Where the temporary differences are related to losses, relevant tax law is considered to determine the availability of the losses to offset against the future taxable profits. Recognition therefore involves judgement regarding the future financial performance of the particular legal entity or tax group in which the deferred tax asset has been recognised.

3.17. Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Ind-AS 33 on Earnings per share. Basic EPS is calculated by dividing the net-profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

For calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless they have been issued at a later date. In computing the dilutive earnings per share, only potential equity shares that are dilutive and that either reduces the earnings per share or increases loss per share are included.

3.18. Cash-flow statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

4. Significant accounting judgements, estimates and assumptions, Fair Value Measurement

The preparation of standalone financial statements in conformity with the Ind-AS requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the accompanying disclosure and the disclosure of contingent liabilities, at the end of the reporting period. Estimates and underlying assumptions are reviewed on an on-going basis.

Revisions to accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. 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.

In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements is included in the following notes:

4.1. Business Model Assessment

Classification and measurement of financial assets depends on the results of the SPPI and the business model test. The Company determines the business model at a level that reflects how groups of financial assets are managed together to achieve a particular business objective. This assessment includes judgement reflecting all relevant evidence including how the performance of the assets is evaluated and their performance measured, the risks that affect the performance of the assets and how these are managed and how the managers of the assets are compensated. The Company monitors financial assets measured at amortised cost or fair value through other comprehensive income that are derecognised prior to their maturity to understand the reason for their disposal and whether the reasons are consistent with the objective of the business for which the asset washed. Monitoring is part of the Company''s continuous assessment of whether the business model for which the remaining financial assets are held continues to be appropriate and if it is not appropriate whether there has been a change in business model and so prospective change to the classification of those assets.

4.2. Effective Interest Rate (EIR) method

The Company''s EIR methodology, recognises interest income using a rate of return that represents the best estimate of a constant rate of return over the expected behavioural life of loans given and recognises the effect of potentially different interest rates at various stages and other characteristics of the product life cycle (including prepayments and penalty interest and charges).

This estimation, by nature, requires an element of judgement regarding the expected behaviour and life-cycle of the instruments, probable fluctuations in collateral value as well as expected changes to India''s base rate and other fee income/expense that are integral parts of the instrument

4.3. Impairment of financial assets using expected credit loss method

The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company''s history, existing market conditions as well as forward looking estimates at the end of each reporting period.

4.4. Fair value measurement:

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using various valuation techniques. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

4.5. Other estimates:

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Mar 31, 2024

3.1. Recognition of interest income

The Company recognises interest income by applying the effective interest rate (EIR) to the
gross carrying amount of a financial asset and as per year to year financial contracts as
agreed by the management.

3.2. Recognition of revenue from sale of goods

Revenue (other than for Financial Instruments within the scope of Ind-AS 109) is measured at
an amount that reflects the considerations, to which an entity expects to be entitled in
exchange for transferring goods or services to customer, excluding amounts collected on
behalf of third parties.

The Company recognises revenue from contracts with customers based on a five-step model
as set out in Ind-AS 115:

Step 1: Identify contract(s) with a customer: A contract is defined as an agreement between
two or more parties that creates enforceable rights and obligations and sets out the criteria
for every contract that must be met.

Step 2: Identify performance obligations in the contract: A performance obligation is a
promise in a contract with a customer to transfer a good or service to the customer.

Step 3: Determine the transaction price: The transaction price is the amount of consideration
to which the Company expects to be entitled in exchange for transferring promised goods or
services to a customer, excluding amounts collected on behalf of third parties.

Step 4: Allocate the transaction price to the performance obligations in the contract: For a
contract that has more than one performance obligation, the Company allocates the
transaction price to each performance obligation in an amount that depicts the amount of
consideration to which the Company expects to be entitled in exchange for satisfying each
performance obligation.

Step 5: Recognise revenue when (or as) the Company satisfies a performance obligation.
Revenue from contract with customer for rendering services is recognised at a point in time
when performance obligation is satisfied.

3.2.1. Recognition of Dividend Income

Dividend Income (including from FVOCI investments) is recognised when the Company''s
right to receive the payment is established. This is established when it is probable that the
economic benefits associated with the dividend will flow to the entity and the amount of
dividend can be measured reliably.

3.3. Financial instruments
A. Financial Assets

3.3.1. Initial recognition and measurement

All financial assets are recognised initially at fair value when the parties become party to the
contractual provisions of the financial asset. In case of financial assets which are not recorded
at fair value through profit or loss, transaction costs that are directly attributable to the
acquisition or issue of the financial assets, are adjusted to the fair value on initial recognition.

3.3.2. Subsequent measurement

The Company classifies its financial assets into various measurement categories. The
classification depends on the contractual terms of the financial assets'' cash flows and the
Company''s business model for managing financial assets.

a. Financial assets measured at amortised cost

A financial asset is measured at Amortised Cost if it is held within a business model whose
objective is to hold the asset in order to collect contractual cash flows and the contractual
terms of the Financial Asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.

b. Financial assets measured at fair value through other comprehensive income (FVOCI)

A financial asset is measured at FVOCI if it is held within a business model whose objective
is achieved by both collecting contractual cash flows and selling financial assets and
contractual terms of financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.

c. Financial assets measured at fair value through profit or loss (FVTPL)

A financial asset which is not classified in any of the above categories are measured at
FVTPL.

3.3.3. Investment in Associates

Investments in associate companies are carried at cost and fair value (deemed cost) as per
Ind-AS-101 less accumulated impairment losses, if any. Where an indication of impairment
exists, the carrying amount of the investment is assessed and written down immediately to
its recoverable amount. On disposal of investments in associate companies, the difference
between net disposal proceeds and the carrying amounts are recognised in the Statement of
Profit and Loss.

3.3.4. Equity Investments

Equity instruments are instruments that meet the definition of equity from the issuer''s
perspective; that is, instruments that do not contain a contractual obligation to pay and that
evidence a residual interest in the issuer''s net assets.

The company subsequently measures all equity investments at fair value. Where the
company''s management has elected to present fair value gains and losses on equity
investments in other comprehensive income, there is no subsequent reclassification of fair
value gains and losses to profit or loss following the de-recognition of the investment.

B. Financial liabilities

3.3.5. Initial recognition and measurement

All financial liabilities are recognized initially at fair value and, in the case of borrowings and
payables, net of directly attributable transaction costs.

3.3.6. Subsequent Measurement

Financial liabilities are subsequently carried at amortized cost using the effective interest
method.

3.4. De-recognition of financial assets and liabilities

3.4.1. Financial Asset

The Company derecognizes a financial asset when the contractual cash flows from the asset
expire or it transfers its rights to receive contractual cash flows from the financial asset in a
transaction in which substantially all the risks and rewards of ownership are transferred.

Any interest in transferred financial assets that is created or retained by the Company is
recognized as a separate asset or liability.

3.4.2. Financial Liability

A financial liability is derecognised when the obligation under the liability is discharged,
cancelled or expires. Where an existing financial liability is replaced by another from the
same lender on substantially different terms, or the terms of an existing liability are
substantially modified, such an exchange or modification is treated as de-recognition of the
original liability and the recognition of a new liability. The difference between the carrying
value of the original financial liability and the consideration paid is recognised in profit or
loss.

3.5. Offsetting

Financial assets and financial liabilities are generally reported gross in the balance sheet.
Financial assets and liabilities are offset and the net amount is presented in the balance sheet
when the Company has a legal right to offset the amounts and intends to settle on a net basis
or to realise the asset and settle the liability simultaneously in all the following
circumstances:

a. The normal course of business

b. The event of default

c. The event of insolvency or bankruptcy of the Company and/or its counterparties

3.6. Impairment of financial assets

In accordance with Ind-AS 109, the Company uses ''Expected Credit Loss'' model (ECL), for
evaluating impairment of financial assets other than those measured at Fair value through
profit and loss.

The measurement of ECL reflects:

• An unbiased and probability-weighted amount that is determined by evaluating a range of
possible outcomes;

• The time value of money; and

• Reasonable and supportable information that is available without undue cost or effort at
the reporting date about past events, current conditions and forecasts of future economic
conditions.

The measurement of ECL allowance is an area that requires the use of complex models and
significant assumptions about future economic conditions and credit behaviour.

3.6.1. Write-off policy

The company writes off financial assets, in whole or in part, when it has exhausted all
practical recovery efforts and has concluded there is no reasonable expectation of recovery.
Indicators that there is no reasonable expectation of recovery include (i) ceasing enforcement
activity and (ii) where the company''s recovery method is foreclosing on collateral and the
value of the collateral is such that there is no reasonable expectation of recovering in full.

3.7. Determination of fair value of Financial Instruments

The Company measures financial instruments, such as, investments at fair value at each
balance sheet date. value is the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date.
The fair value measurement is based on the presumption that the transaction to sell the asset
or transfer the liability takes place either:

i. In the principal market for the asset or liability, or

ii. In the absence of a principal market, in the most advantageous market for the asset or
liability. The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market
participants would use when pricing the asset or liability, assuming that market participants
act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant''s
ability to generate economic benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset in its highest and best use.

3.8. Cash and cash equivalents

Cash and cash equivalents comprise of cash at banks and on hand and short-term deposits
with an original maturity of three months or less, which are subject to an insignificant risk of
changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and
short- term deposits, as defined above, net of outstanding bank overdrafts if any, as they are
considered an integral part of the Company''s cash management.

3.9. Property, plant and equipment

All items of property, plant and equipment are stated at historical cost less depreciation.
Historical cost includes expenditure that is directly attributable to the acquisition of the
items.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate
asset, as appropriate, only when it is probable that future economic benefits associated with
the item will flow to the company and he cost of the item can be measured reliably. The
carrying amount of any component accounted for as a separate asset is derecognised when
replaced. All other repairs and maintenance are charged to profit or loss during the reporting
period in which they are incurred.

3.9.1. Depreciation

Depreciation on Property, Plant and Equipment is calculated using written down value
method (WDV) to write down the cost of property and equipment to their residual values
over their estimated useful lives which are in line with the estimated useful life as specified
in Schedule II of the Companies Act, 2013.

The estimated useful lives are as follows:

Particulars Useful life

Furniture and fixture 10 years

Office equipment 15 years

Computer 3 years

Vehicles 15 years

Plant & Machinery 15 years

The company provides pro-rata depreciation from the day the asset is put to use and for any
asset sold, till date of sale. The asset''s residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period.

An asset''s carrying amount is written down immediately to its recoverable amount if the
asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposal are determined by comparing proceeds with carrying amount
and are recognised in the statement of profit and loss.

3.10. Impairment of non-financial assets: Property, Plant and Equipment

The Company assesses, at each reporting date, whether there is any indication that any
Property, Plant and Equipment or group of assets called Cash Generating Units (CGU)
maybe impaired. If any such indication exists, or when annual impairment testing for an
asset is required, the Company estimates the asset''s recoverable amount to determine the
extent of impairment, if any.

An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair
value less costs of disposal and its value in use. Recoverable amount is determined for an
individual asset, unless the asset does not generate cash inflows that are largely independent
of those from other assets or groups of assets. When the carrying amount of an asset or CGU
exceeds its recoverable amount, the asset is considered impaired and is written down to its
recoverable amount.

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 the risks specific to the asset. In determining fair value less costs of disposal,
recent market transactions are taken into account. If no such transactions can be identified, an
appropriate valuation model is used. These calculations are corroborated by valuation
multiples, quoted share prices for publicly traded companies or other available fair value
indicators.

An assessment is made at each reporting date to determine whether there is an indication
that previously recognised impairment losses no longer exist or have decreased. If such
indication exists, the Company estimates the asset''s or CGU''s recoverable amount. A
previously recognised impairment loss is reversed only if there has been a change in the
assumptions used to determine the asset''s recoverable amount since the last impairment loss
was recognised.

The reversal is limited so that the carrying amount of the asset does not exceed its
recoverable amount, nor exceed the carrying amount that would have been determined, net
of depreciation, had no impairment loss been recognised for the asset in prior years.

Such reversal is recognised in the statement of profit or loss unless the asset is carried at a
revalued amount, in which case, the reversal is treated as a revaluation increase.

3.11. Investment Property

An investment property is accounted for in accordance with cost model. Depreciation on
Property, Plant and Equipment is provided in accordance with the provisions of Schedule II
of the Companies Act, 2013.

3.12. Inventories

The company has two categories of assets as mentioned hereunder:

• Stock of shares: These are valued at cost.

• Stock of Real Estate: These are valued on the basis of cost or net realized value, whichever
is lower.

3.13. Borrowing Costs

Borrowing Costs, which are directly attributable to the acquisition / construction of fixed
assets, till the time such assets are ready for intended use, are capitalised as part of the cost of
the assets. Other borrowing costs are recognised as an expense in the year in which they are
incurred. Brokerage costs directly attributable to a borrowing are expensed over the tenure of
the borrowing.

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Mar 31, 2014

1) GENERAL

The Financial statement are prepared under the historical cost convention on the basis of going concern as per applicable accounting standard and the provisions of the Companies Act 1956, as adopted consistently by the company The company follows mercantile system of accounting.

2) REVENUE RECOGNITION

Revenue / Income and expenditures are accounted for on accrual basis , as and when they are earned or incurred .

3) In the opinion of the board all the current assets and the loan and advances are approximately of the value stated if realized in the ordinary course of business. The provision for all known liabilities are adequate and are not in excess of the amount considered reasonably necessary. Sundry Debtors, Creditors and loans & advances are shown as appearing in the accounts, and are subject to confirmation.

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Mar 31, 2011

1) GENERAL

The Financial statement are prepared under the historical cost convention on the basis of going concern as per applicable accounting standard and the provisions of the Companies Act 1956, as adopted consistently by the company . The company follows mercantile system of accounting,

2) FIXED ASSTES

Fixed Assets are Stated at cost/less accumulated depreciation . Cost comprises of purchase price or construction cost including any cost of bringing the asset to its working condition for use.

3) DEPRECIATION

Depreciation on Fixed Assets has been provided on W.D.V. method as per clarification and on the basis of rates specified in schedule XIV to the companies Act, 1956.

4) INVESTMENT

Long Term Investment are stated at cost. In case of permanent diminution in value of certain investment appropriate provision for the same was made in Accounts in earlier year. The same provision for the same was made in Accounts in earlier year. The same provision is continuing. There is no further diminution in value of investment.

5) INVENTORIES OF SHARES AND REAL ESTATE (STOCK IN TRADE)

a) Shares, stock are valued at cost as on 31st March, 2011 as per practice.

b) Real estate are valued at expected net realizable value or cost whichever is lower.

6) REVENUE RECOGNITION

Revenue / Income except divided and expenditures except Municipal Taxes are accounted for on accrual basis, as and when they are earned or incurred.

7) Deferred Tax resulting from timing difference between book & tax profits is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystallize. Tax provision has been made according to Income Tax Act, 1961.

8) EMPLOYEES BENEFITS

The Company has provided gratuity amounting to Rs.27750.00 only (as per guide lines prescribed in AS-15, issued by The Institute of Chartered Accountants Of India & as per provisions of Gratuity Act) for all employees on completed year of Service. The provision is made for 15 days salary of each completed years of services.

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Mar 31, 2010

1) GENERAL

The Financial statement are prepared under the historical cost convention on the basis of going Conner in per applicable accounting standard and the provisions of the Companies Act 1956.. as adopted consistently by the company . The company follows mercantile system of accounting.

2) FIXED ASSTES

Fixed Assets are stated at cost/revalued amount less accumulated depreciation . Coat Comprises of purchase price or construction cost including any cost of bringing the asset to its working condition for use.

3) DEPRECIATION.

Depreciation on Fixed Assets has been provided on W.D.V. method as per clarification and on the basis of rates specified in schedule XIV to the companies Act,1956.

4) INVESTMENT

Long Term investment are stated at cast. In case there is a permanent diminution in value of any investment appropriate provision for the same is made in Accounts.

5) INVENTORIES OF SHARES AND REAL ESTATE (STOCK IN TRADE)

a) Shares stock are valued cost as on 31st March 2010.

b) Real estate are valued at expected net realizable value or cost whichever is lower.

6) REVENUE RECOGNITION

Revenue/Income except dividend and expenditures except Municipal Taxes are accounted For on accrual as and when they are earned or incurred.

7) DEFERRED TAX

deferred Tax resulting from timing difference between book & tax profits is accounted for under the liability method at the current rate of tax to the extent that the timing difference are expected to crystallize. Tax provision has been made according to Income Tax Act,1961.

8) EMPLOYEES BENEFITS

The company has provided gratuity amounting to Rs.33400.00 only(as per guide lines prescribed in AS-15- issued by The Institute Of Chartered Accountants Of India & as per provisions of Gratuity Act, for all employees on completed year of service. The provision is made for 15 days salary of each completed year of services..

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Mar 31, 2009

1) GENERAL

The Financial s atement are prepared under the historical cost convention on the basis of going concern i s per applicable accounting standard and the provisions of the Companies Act 1956,. as adoplid consistently by the company . The company follows mercantile system of accounting.

2) FIXED ASSTLS

Fixed Assets Ere staled at cost / revalued amount less accumulated depreciation , Cost comprises of rurchnse price or construction cost including any cost of bringing the asset to its working condition tor use.

3 ) DEPRECIATION

Depreciation on; Fixed Assets has been provided on W.D.V. method as per clarification and on the basis of ates specified in Schedule XIV to the companies Act 1956 .

4 ) INVESTMENT

Long Term investment are stated at cost. In case there is a permanent diminution in value of any .investment appropriate provision for the same is made in Accounts .

5) INVENTORIES OF SHAKES AND REAL ESTATE (STOCK IN TRADE)

a) Shares.stock are valued at cost as on 3Is'',March 2009 while upto proceeding previous year it was valued at cost or market price which ever is less. Due to change in basis of valuation profit has increased by Rs. 2132911.45,

b ) Real estate are valued at expected net realizable value or cost whichever is lower .

6) REVENUE RECOGNITION

Revenue / Income except dividend and expenditures except Municipal Taxes are accounted for on accrual basis , as and when they are earned or incurred .

7) Deferred Tax resulting from timing difference between book & tax profits is accounted for under the liability method at the current rate of lax to the extent that the timing difference arc expected to crystalyse . Tax provision has been made according to Income Tax Act 1961 .

8) Folowing Mutual funds were shown as stock in trade at cost or market price whichever is lower till 31.03.2008 and shown under the head Inventories in Balance Sheet as at 31.03.2008. The management has decided to convert the same into long term Investments as at 21.OS.08 & the market value of these Mutual Funds as at 21.08.2008 has been considered for calculating the value at which these arc to be transferred to Investment account. The difference between the cost and market value has been shown in profit & loss account for the year ended on 31.03.2009.

9 ) EMPLOYEES BENEFITS

The Company, lias provided gratuity amounting to Rs. 15,600.00 only( as per guide lines prescribed in AS - 15 , issued by The Institute Of Chartered Accountants Of India & as per provisions of Gratuity Act) for all employees on completed year of service. The provision is made for 15 days salary of each completed year of services .