A Oneindia Venture
Click it and Unblock the Notifications
National Standard (India) Ltd. நிறுவனத்தின் கணக்கியல் கொள்கைகள்
Mar 31, 2025
1 MATERIAL ACCOUNTING POLICIES
A Company''s Background
National Standard (India) Limited (the Company) is a public limited company domiciled and incorporated in India under
the Companies Act, 1956 vide CIN - L27109MH1962PLC265959. The Company''s registered office is located at 412,
Floor - 4, 17 G Vardhaman Chamber, Cawasji Patel Road, Horniman Circle, Fort, Mumbai - 400001. The Company is
primarily engaged in the business of real estate development.
The Financial Statements are approved by the Company''s Board of Directors at its meeting held on 17-April-2025
B Material Accounting Policies
I Basis of Preparation
The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (âInd
AS'') notified under section 133 of the Companies Act 2013, read together with the Companies (Indian Accounting
Standards) Rules, 2015 and amendment if any.
These financial statements have been prepared and presented under the historical cost convention, on the accrual
basis of accounting. The accounting policies have been applied consistently over all the periods presented in these
financial statements.
The financial statements are presented in Indian Rupees (?) and all values are rounded to the nearest lakhs except
when otherwise indicated.
II Summary of Material Accounting Policies
1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current
classification. An asset is treated as current when it is:
i) Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Held primarily for the purpose of trading
iii) Expected to be realised within twelve months after the reporting period, or
iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least
twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
i) It is expected to be settled in normal operating cycle
ii) It is held primarily for the purpose of trading
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the
reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and
cash equivalents.
The operating cycle of the Company''s real estate operations varies from project to project depending on the
size of the project, type of development, project complexities and related approvals. Accordingly, project related
assets and liabilities are classified into current and non-current based on the operating cycle of the project.
All other assets and liabilities have been classified into current and non-current based on a period of twelve
months.
2 Property, Plant and Equipment
i. Recognition and measurement
All property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes
expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing
cost and incidental expenses related to the acquisition and installation of the asset.
ii. Subsequent costs
Subsequent expenditure, including cost of the items which can be reliably estimated, is capitalised only when it
is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and
maintenance are charged to the Ind AS Statement of Profit and Loss during the reporting period in which they are
incurred.
iii. Derecognition
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future
economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item
of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying
amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
iv. Depreciation
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in
Schedule II of Companies Act, 2013.
Depreciation on addition to Property, Plant and Equipment is provided on pro-rata basis from the date of
acquisition.
Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding
the month of sale.
Depreciation methods, useful lives and residual values are reviewed periodically at each financial year end and
adjusted prospectively, as appropriate.
3 Investment Properties
The Property that is held for long term rental yield or for capital appreciation or both, and that is not occupied by the
Company is classified as an Investment Property.
Investment properties are measured initially at cost, including transaction and borrowing costs. Subsequent to initial
recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment losses,
if any.
The Company depreciates investment properties over the useful life of 60 years from the date of original purchase as
prescribed under Schedule II to the Companies Act, 2013.
Investment Properties are derecognised either when they have been disposed of or when they are permanently
withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net
disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.
Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted, if
appropriate.
4 Inventories
Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally
ascertained on weighted average basis.
Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium
for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects
undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion
and the estimated cost necessary to make the sale.
Mar 31, 2024
1 MATERIAL ACCOUNTING POLICIES A Company''s Background
National Standard (India) Limited (the Company) is a public limited company domiciled and incorporated in India under the Companies Act, 1956 vide CIN - L27109MH1962PLC265959. The Company''s registered office is located at 412 , Floor - 4, 17 G Vardhaman Chamber, Cawasji Patel Road, Horniman Circle, Fort, Mumbai - 400001. The Company is primarily engaged in the business of real estate development.
The Financial Statements are approved by the Company''s Board of Directors at its meeting held on 18-April-24.
B Material Accounting PoliciesI Basis of Preparation
The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (âInd AS'') notified under section 133 of the Companies Act 2013, read together with the Companies (Indian Accounting Standards) Rules, 2015 and amendment if any.
These financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in Indian Rupees (?) and all values are rounded to the nearest lakhs except when otherwise indicated.
II Summary of Material Accounting Policies 1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:
i) Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Held primarily for the purpose of trading
iii) Expected to be realised within twelve months after the reporting period, or
iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
i) It is expected to be settled in normal operating cycle
ii) It is held primarily for the purpose of trading
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.
The operating cycle of the Company''s real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. Accordingly, project related assets and liabilities are classified into current and non-current based on the operating cycle of the project. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.
2 Property, Plant and Equipmenti. Recognition and measurement
All property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing cost and incidental expenses related to the acquisition and installation of the asset.
Subsequent expenditure, including cost of the items which can be reliably estimated, is capitalised only when it is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and maintenance are charged to the Ind AS Statement of Profit and Loss during the reporting period in which they are incurred.
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in Schedule II of Companies Act, 2013.
|
Sr. No. |
Property, Plant and Equipment |
Useful life (Years) |
|
i) |
Plant and Equipment |
8 to15 |
|
ii) |
Furniture and Fixtures |
10 |
|
iii) |
Office Equipment |
5 |
Depreciation on addition to Property, Plant and Equipment is provided on pro-rata basis from the date of acquisition. Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding the month of sale.
Depreciation methods, useful lives and residual values are reviewed periodically at each financial year end and adjusted prospectively, as appropriate.
The Property that is held for long term rental yield or for capital appreciation or both, and that is not occupied by the Company is classified as an Investment Property.
Investment properties are measured initially at cost, including transaction and borrowing costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment losses, if any.
The Company depreciates investment properties over the useful life of 60 years from the date of original purchase as prescribed under Schedule II to the Companies Act, 2013.
Investment Properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.
Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted, if appropriate.
Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally ascertained on weighted average basis.
Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale.
5 Provisions and Contingencies
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure of contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
6 Impairment of Non-Financial Assets (excluding Inventories and Deferred Tax Assets)
Non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units (''CGUs'').
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial AssetsInitial recognition and measurement
The Company classifies its financial assets in the following measurement categories.
⢠those to be measured subsequently at fair value (either through OCI, or through profit or loss)
⢠those measured at amortised cost
All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
For purposes of subsequent measurement, financial assets are classified in four categories:
i) Debt instruments at amortised cost
ii) Debt instruments at fair value through other comprehensive income (FVTOCI)
iii) Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)
iv) Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortised cost
A ''debt instrument'' is measured at the amortised cost if both the following conditions are met:
a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment if any, are recognised in the Statement of Profit and Loss.
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and
b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company does not have any debt instruments which meets the criteria for measuring the debt instrument at FVTOCI.
Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''Accounting Mismatch''). The Company has not designated any debt instrument at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
All equity investments, except investments in subsidiaries and associates are measured at FVTPL. The Company may make an irrevocable election on initial recognition to present in OCI any subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
Derecognition of Financial Assets
A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company''s Balance Sheet) when:
i) The rights to receive cash flows from the asset have expired, or
ii) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of Financial Assets
The Company assess on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVTOCI debts instruments. The impairment methodology applied depends on whether there has been significant increase in credit risk. For trade receivables, the Company is not exposed to any credit risk as the possession of residential and commercial units is handed over to the buyer only after all the instalments are recovered. For financial assets carried at amortised cost, the carrying amount is reduced and the amount of the loss is recognised in the Statement of profit and loss. Interest income on such financial assets continues to be accrued on the reduced carrying
amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Financial asset together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or decreased. If a write-off is later recovered, the recovery is credited to finance costs.
Financial LiabilitiesInitial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liability not recorded at fair value through Profit or Loss, net of directly attributable transaction costs.
The Company''s financial liabilities include trade and other payables and loans and borrowings.
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities measured at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the Statement of profit and loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to Statement of Profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated any financial liability as at fair value through profit and loss.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for
transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition of Financial Liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When 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 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.
Reclassification of Financial Assets and Financial Liabilities
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company''s management determines change in the business model as a result of external or internal changes which are significant to the Company''s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Ind AS Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Fair 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
i) Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
ii) Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
iii) Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
Cash and cash equivalent in the Balance Sheet comprise 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.
The Company has applied five step model as set out in Ind AS 115 to recognise revenue in this Financial Statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a. The customer simultaneously receives and consumes the benefits provided by the Company''s performance as the Company performs; or
b. The Company''s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
c. The Company''s performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at point of time and over a period of time based on the conditions in the contracts with customers.
The specific revenue recognition criteria are described below:(I) Income from Property Development
The Company has determined that the existing terms of the contract with customers does not meet the criteria to recognise revenue over a period of time. Revenue is recognized at point in time with respect to contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the application and receipt of occupancy certificate.
The Company provides rebates to the customers. Rebates are adjusted against customer dues and the revenue to be recognized. To estimate the variable consideration for the expected future rebates the company uses the âmost-likely amountâ method or âexpected value methodâ.
(II) Contract Balances Contract Assets
The Company is entitled to invoice customers for construction of residential and commercial properties based on achieving a series of construction-linked milestones. A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the company performs by transferring goods or services to a customer before the payment is due, a contract asset is recognized for the earned consideration that is conditional. Any receivable which represents the Company''s right to the consideration that is unconditional is treated as a trade receivable.
Contract Liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue when the Company performs under the contract.
For all debt instruments measured at amortised cost. Interest income is recorded using the effective interest rate (EIR).
Rental income arising from operating leases is accounted over the lease terms.
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period.
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Presentation of Current and Deferred Tax:
Current and deferred tax are recognized as income or an expense in the Statement of Profit and Loss, except when they relate to items that are recognized in OCI, in which case, the current and deferred tax income/ expense are recognized in OCI. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if the Company has a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on the Company.
Borrowing costs that are directly attributable to long term project development activities are inventorised / capitalized as part of project cost.
All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable equity share holders to by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable equity share holders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
In arrangements where the Company is the lessor, it determines at lease inception whether the lease is a finance lease or an operating lease. Leases that transfer substantially all of the risk and rewards incidental to ownership of the underlying asset to the counterparty (the lessee) are accounted for as finance leases. Leases that do not transfer substantially all of the risks and rewards of ownership are accounted for as operating leases. Lease payments received under operating leases are recognized as income in the statement of profit and loss on a straight-line basis over the lease term or another systematic basis. The Company applies another systematic basis if that basis is more representative of the pattern in which benefit from the use of the underlying asset is diminished.
Mar 31, 2023
1 SIGNIFICANT ACCOUNTING POLICIESÂ
A Company's Background
National Standard (India) Limited (the Company) is a public limited company domiciled and incorporated in India under the Companies Act, 1956 vide CIN - L27109MH1962PLC265959. The Company's registered office is located at 412 , Floor - 4, 17 G Vardhaman Chamber, Cawasji Patel Road, Horniman Circle, Fort, Mumbai - 400001. The Company is primarily engaged in the business of real estate development.
The Financial Statements are approved by the Company's Board of Directors at its meeting held on 12-April-23.
B Significant Accounting Policies
I Â Â Â Basis of Preparation
The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (âInd AS') notified under section 133 of the Companies Act 2013, read together with the Companies (Indian Accounting Standards) Rules, 2015 and amendment if any.
These financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in Indian Rupees (?) and all values are rounded to the nearest lakhs except when otherwise indicated.
II    Summary of Significant Accounting Policies 1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:
i) Â Â Â Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Â Â Â Held primarily for the purpose of trading
iii) Â Â Â Expected to be realised within twelve months after the reporting period, or
iv)    Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
i) Â Â Â It is expected to be settled in normal operating cycle
ii) Â Â Â It is held primarily for the purpose of trading
iii) Â Â Â It is due to be settled within twelve months after the reporting period, or
iv)    There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.
The operating cycle of the Company's real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. Accordingly, project related assets and liabilities are classified into current and non-current based on the operating cycle of the project. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.â
2 Property, Plant and Equipmenti. Â Â Â Recognition and measurement
All property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing cost and incidental expenses related to the acquisition and installation of the asset.
ii. Â Â Â Subsequent costs
Subsequent expenditure, including cost of the items which can be reliably estimated, is capitalised only when it is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and maintenance are charged to the Ind AS Statement of Profit and Loss during the reporting period in which they are incurred.
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in Schedule II of Companies Act, 2013.
|
Sr. No. |
Property, Plant and Equipment |
Useful life (Years) |
|
i) |
Plant and Equipment |
8 to15 |
|
ii) |
Furniture and Fixtures |
10 |
|
iii) |
Office Equipment |
5 |
Depreciation on addition to Property, Plant and Equipment is provided on pro-rata basis from the date of acquisition.
Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding the month of sale.
Depreciation methods, useful lives and residual values are reviewed periodically at each financial year end and adjusted prospectively, as appropriate.
The Property that is held for long term rental yield or for capital appreciation or both, and that is not occupied by the Company is classified as an Investment Property.
Investment properties are measured initially at cost, including transaction and borrowing costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment losses, if any.
The Company depreciates investment properties over the useful life of 60 years from the date of original purchase as prescribed under Schedule II to the Companies Act, 2013.
Investment Properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition. Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted, if appropriate.
Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally ascertained on weighted average basis.
Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale.
5 Â Â Â Provisions and Contingencies
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure of contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
6 Â Â Â Impairment of Non-Financial Assets (excluding Inventories and Deferred Tax Assets)
Non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units ('CGUs').
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial AssetsInitial recognition and measurement
The Company classifies its financial assets in the following measurement categories.
⢠   those to be measured subsequently at fair value (either through OCI, or through profit or loss)
⢠   those measured at amortised cost
All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
Subsequent measurementFor purposes of subsequent measurement, financial assets are classified in four categories:
i) Â Â Â Debt instruments at amortised cost
ii) Â Â Â Debt instruments at fair value through other comprehensive income (FVTOCI)
iii) Â Â Â Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)
iv) Â Â Â Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortised cost
A 'debt instrument' is measured at the amortised cost if both the following conditions are met:
a)    The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b)    Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment if any, are recognised in the Statement of Profit and Loss.
A 'debt instrument' is classified as at the FVTOCI if both of the following criteria are met:
a)    The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and
b) Â Â Â The asset's contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company does not have any debt instruments which meets the criteria for measuring the debt instrument at FVTOCI.
Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as 'Accounting Mismatch'). The Company has not designated any debt instrument at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
All equity investments, except investments in subsidiaries and associates are measured at FVTPL. The Company may make an irrevocable election on initial recognition to present in OCI any subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
Derecognition of Financial Assets
A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company's Balance Sheet) when:
i) Â Â Â The rights to receive cash flows from the asset have expired, or
ii)    The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company's continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of Financial Assets
The Company assess on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVTOCI debts instruments. The impairment methodology applied depends on whether there has been significant increase in credit risk. For trade receivables, the Company is not exposed to any credit risk as the possession of residential and commercial units is handed over to the buyer only after all the instalments are recovered.
For financial assets carried at amortised cost, the carrying amount is reduced and the amount of the loss is recognised in the Statement of profit and loss. Interest income on such financial assets continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Financial asset together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or decreased. If a write-off is later recovered, the recovery is credited to finance costs.
Financial LiabilitiesInitial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liability not recorded at fair value through Profit or Loss, net of directly attributable transaction costs.
The Company's financial liabilities include trade and other payables and loans and borrowings.
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities measured at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the Statement of profit and loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to Statement of Profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated any financial liability as at fair value through profit and loss.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition of Financial Liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When 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 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.
Reclassification of Financial Assets and Financial Liabilities
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company's management determines change in the business model as a result of external or internal changes which are significant to the Company's operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Ind AS Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Fair 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) Â Â Â 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
i) Â Â Â Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
ii) Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
iii)    Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
9 Â Â Â Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise 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.
The Company has applied five step model as set out in Ind AS 115 to recognise revenue in this Financial Statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a.    The customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs; or
b.    The Company's performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
c.    The Company's performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where any of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at point of time and over a period of time based on the conditions in the contracts with customers.
The specific revenue recognition criteria are described below:
(I) Income from Property Development
The Company has determined that the existing terms of the contract with customers does not meet the criteria to recognise revenue over a period of time. Revenue is recognized at point in time with respect to contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the application and receipt of occupancy certificate.
The Company provides rebates to the customers. Rebates are adjusted against customer dues and the revenue to be recognized. To estimate the variable consideration for the expected future rebates the company uses the âmost-likely amountâ method or âexpected value methodâ.â
(II) Contract BalancesContract Assets
The Company is entitled to invoice customers for construction of residential and commercial properties based on achieving a series of construction-linked milestones. A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the company performs by transferring goods or services to a customer before the payment is due, a contract asset is recognized for the earned consideration that is conditional. Any receivable which represents the Company's right to the consideration that is unconditional is treated as a trade receivable.
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue when the Company performs under the contract.
For all debt instruments measured at amortised cost. Interest income is recorded using the effective interest rate (EIR).
Rental income arising from operating leases is accounted over the lease terms.
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period.
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Presentation of Current and Deferred Tax:
Current and deferred tax are recognized as income or an expense in the Statement of Profit and Loss, except when they relate to items that are recognized in OCI, in which case, the current and deferred tax income/ expense are recognized in OCI. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if the Company has a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on the Company.
Borrowing costs that are directly attributable to long term project development activities are inventorised / capitalized as part of project cost.
All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable equity share holders to by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable equity share holders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
14 Â Â Â LeasesCompany as a Lessor
In arrangements where the Company is the lessor, it determines at lease inception whether the lease is a finance lease or an operating lease. Leases that transfer substantially all of the risk and rewards incidental to ownership of the underlying asset to the counterparty (the lessee) are accounted for as finance leases. Leases that do not transfer substantially all of the risks and rewards of ownership are accounted for as operating leases. Lease payments received under operating leases are recognized as income in the statement of profit and loss on a straight-line basis over the lease term or another systematic basis. The Company applies another systematic basis if that basis is more representative of the pattern in which benefit from the use of the underlying asset is diminished.
Mar 31, 2022
1 SIGNIFICANT ACCOUNTING POLICIES A Company''s Background
National Standard (India) Limited (the Company) is a public limited company domiciled and incorporated in India under the Companies Act, 1956 vide CIN - L27109MH1962PLC265959. The Company''s registered office is located at 412 , Floor - 4, 17 G Vardhaman Chamber, Cawasji Patel Road, Horniman Circle, Fort, Mumbai - 400001. The Company is primarily engaged in the business of real estate development.
The Financial Statements are approved by the Company''s Board of Directors at its meeting held on 14-April-22.
B Significant Accounting PoliciesI Basis of Preparation
The 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, read together with the Companies (Indian Accounting Standards) Rules, 2015 and amendment if any.
These financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in Indian Rupees (?) and all values are rounded to the nearest lakhs except when otherwise indicated.
II Summary of Significant Accounting Policies 1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:
i) Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Held primarily for the purpose of trading
iii) Expected to be realised within twelve months after the reporting period, or
iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.A liability is current when:
i) It is expected to be settled in normal operating cycle
ii) It is held primarily for the purpose of trading
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.
The operating cycle of the Company''s real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. Accordingly, project related assets and liabilities are classified into current and non-current based on the operating cycle of the project. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.
2 Property, Plant and Equipmenti. Recognition and measurement
All property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing cost and incidental expenses related to the acquisition and installation of the asset.
Subsequent expenditure, including cost of the items which can be reliably estimated, is capitalised only when it is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and maintenance are charged to the Ind AS Statement of Profit and Loss during the reporting period in which they are incurred.
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in Schedule II of Companies Act, 2013.
|
Sr. No. |
Property, Plant and Equipment |
Useful life (Years) |
|
i) |
Plant and Equipment |
8 to15 |
|
ii) |
Furniture and Fixtures |
10 |
|
iii) |
Office Equipment |
5 |
Depreciation on addition to Property, Plant and Equipment is provided on pro-rata basis from the date of acquisition. Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding the month of sale.
Depreciation methods, useful lives and residual values are reviewed periodically at each financial year end and adjusted prospectively, as appropriate.
The Property that is held for long term rental yield or for capital appreciation or both, and that is not occupied by the Company is classified as an Investment Property.
Investment properties are measured initially at cost, including transaction and borrowing costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment losses, if any.
The Company depreciates investment properties over the useful life of 60 years from the date of original purchase as prescribed under Schedule II to the Companies Act, 2013.
Investment Properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.
Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted, if appropriate.
Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally ascertained on weighted average basis.
Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale.
5 Provisions and Contingencies
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure of contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
6 Impairment of Non-Financial Assets (excluding Inventories and Deferred Tax Assets)
Non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units (''CGUs'').
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial AssetsInitial recognition and measurement
The Company classifies its financial assets in the following measurement categories.
⢠those to be measured subsequently at fair value (either through OCI, or through profit or loss)
⢠those measured at amortised cost
All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
For purposes of subsequent measurement, financial assets are classified in four categories:
i) Debt instruments at amortised cost
ii) Debt instruments at fair value through other comprehensive income (FVTOCI)
iii) Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)
iv) Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortised cost
A ''debt instrument'' is measured at the amortised cost if both the following conditions are met:
a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment if any, are recognised in the Statement of Profit and Loss.
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and
b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company does not have any debt instruments which meets the criteria for measuring the debt instrument at FVTOCI.
Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''Accounting Mismatch''). The Company has not designated any debt instrument at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
All equity investments, except investments in subsidiaries and associates are measured at FVTPL. The Company may make an irrevocable election on initial recognition to present in OCI any subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
Derecognition of Financial Assets
A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company''s Balance Sheet) when:
i) The rights to receive cash flows from the asset have expired, or
ii) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement; and either
(a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of Financial Assets
The Company assess on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVTOCI debts instruments. The impairment methodology applied depends on whether there has been significant increase in credit risk. For trade receivables, the Company is not exposed to any credit risk as the possession of residential and commercial units is handed over to the buyer only after all the instalments are recovered.
For financial assets carried at amortised cost, the carrying amount is reduced and the amount of the loss is recognised in the Statement of profit and loss. Interest income on such financial assets continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Financial asset together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or decreased. If a write-off is later recovered, the recovery is credited to finance costs.
Financial LiabilitiesInitial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liability not recorded at fair value through Profit or Loss, net of directly attributable transaction costs.
The Company''s financial liabilities include trade and other payables and loans and borrowings.
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities measured at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the Statement of profit and loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to Statement of Profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated any financial liability as at fair value through profit and loss.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the
terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition of Financial Liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When 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 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.
Reclassification of Financial Assets and Financial Liabilities
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company''s management determines change in the business model as a result of external or internal changes which are significant to the Company''s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Ind AS Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Fair 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
i) Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
ii) Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
iii) Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
Cash and cash equivalent in the Balance Sheet comprise 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.
The Company has applied five step model as set out in Ind AS 115 to recognise revenue in this Financial Statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a. The customer simultaneously receives and consumes the benefits provided by the Company''s performance as the Company performs; or
b. The Company''s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
c. The Company''s performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at point of time and over a period of time based on the conditions in the contracts with customers.
The specific revenue recognition criteria are described below:
(I) Income from Property Development
The Company has determined that the existing terms of the contract with customers does not meet the criteria to recognise revenue over a period of time. Revenue is recognized at point in time with respect to contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the application and receipt of occupancy certificate.The Company provides rebates to the customers. Rebates are adjusted against customer dues and the revenue to be recognized. To estimate the variable consideration for the expected future rebates the company uses the âmost-likely amountâ method or âexpected value methodâ.
(II) Contract Balances Contract Assets
The Company is entitled to invoice customers for construction of residential and commercial properties based on achieving a series of construction-linked milestones. A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the company performs by transferring goods or services to a customer before the payment is due, a contract asset is recognized for the earned consideration that is conditional. Any receivable which represents the Company''s right to the consideration that is unconditional is treated as a trade receivable.
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue when the Company performs under the contract.
For all debt instruments measured at amortised cost. Interest income is recorded using the effective interest rate (EIR).
Rental income arising from operating leases is accounted over the lease terms.
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period.
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is n o longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Presentation of Current and Deferred Tax:
Current and deferred tax are recognized as income or an expense in the Statement of Profit and Loss, except when they relate to items that are recognized in OCI, in which case, the current and deferred tax income/ expense are recognized in OCI. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if the Company has a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on the Company.
Borrowing costs that are directly attributable to long term project development activities are inventorised / capitalized as part of project cost.
All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable equity share holders to by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable equity share holders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
In arrangements where the Company is the lessor, it determines at lease inception whether the lease is a finance lease or an operating lease. Leases that transfer substantially all of the risk and rewards incidental to ownership of the underlying asset to the counterparty (the lessee) are accounted for as finance leases. Leases that do not transfer substantially all of the risks and rewards of ownership are accounted for as operating leases. Lease payments received under operating leases are recognized as income in the statement of profit and loss on a straight-line basis over the lease term or another systematic basis. The Company applies another systematic basis if that basis is more representative of the pattern in which benefit from the use of the underlying asset is diminished.
Mar 31, 2021
1 SIGNIFICANT ACCOUNTING POLICIES A Company''s Background
National Standard (India) Limited (the Company) is a public limited company domiciled and incorporated in India under the Companies Act, 1956 vide CIN - L27109MH1962PLC265959. The Company''s registered office is located at 412 , Floor - 4, 17 G Vardhaman Chamber, Cawasji Patel Road, Horniman Circle, Fort, Mumbai - 400001. The Company is primarily engaged in the business of real estate development.
B Significant Accounting Policies
I Basis of Preparation
The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (âInd AS'') notified under section 133 of the Companies Act 2013, read together with the Companies (Indian Accounting Standards) Rules, 2015 and amendment if any.
These financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in Indian Rupees (?) and all values are rounded to the nearest lakhs except when otherwise indicated.
II Summary of Significant Accounting Policies1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:
i) Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Held primarily for the purpose of trading
iii) Expected to be realised within twelve months after the reporting period, or
iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
i) It is expected to be settled in normal operating cycle
ii) It is held primarily for the purpose of trading
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.
The operating cycle of the Company''s real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. All other assets and liabilities have been classified into current and non-current based on a period of twelve months.â
2 Property, Plant and Equipmenti. Recognition and measurement
All property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing cost and incidental expenses related to the acquisition and installation of the asset.
Subsequent expenditure, including cost of the items which can be reliably estimated, is capitalised only when it is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and maintenance are charged to the Ind AS Statement of Profit and Loss during the reporting period in which they are incurred.
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in Schedule II of Companies Act, 2013.
|
Sr. No. |
Property, Plant and Equipment |
Useful life (Years) |
|
i) |
Plant and Equipment |
8 to15 |
|
ii) |
Furniture and Fixtures |
10 |
|
iii) |
Office Equipment |
5 |
Depreciation on addition to Property, Plant and Equipment is provided on pro-rata basis from the date of acquisition.
Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding the month of sale.
Depreciation methods, useful lives and residual values are reviewed periodically at each financial year end and adjusted prospectively, as appropriate.
The Property that is held for long term rental yield or for capital appreciation or both, and that is not occupied by the Company is classified as an Investment Property.
Investment properties are measured initially at cost, including transaction and borrowing costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment losses, if any.
The Company depreciates investment properties over the useful life of 60 years from the date of original purchase as prescribed under Schedule II to the Companies Act, 2013.
Investment Properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition. Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted, if appropriate.
Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally ascertained on weighted average basis.
Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale.
5 Provisions and Contingencies
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure of contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
6 Impairment of Non-Financial Assets (excluding Inventories and Deferred Tax Assets)
Non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units (''CGUs'').
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Initial recognition and measurement
The Company classifies its financial assets in the following measurement categories.
⢠those to be measured subsequently at fair value (either through OCI, or through profit or loss)
⢠those measured at amortised cost
All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
i) Debt instruments at amortised cost
ii) Debt instruments at fair value through other comprehensive income (FVTOCI)
iii) Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)
iv) Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortised cost
A ''debt instrument'' is measured at the amortised cost if both the following conditions are met:
a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment if any, are recognised in the Statement of Profit and Loss.
Debt instruments at FVTOCI
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and
b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company does not have any debt instruments which meets the criteria for measuring the debt instrument at FVTOCI.
Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''Accounting Mismatch''). The Company has not designated any debt instrument at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
Equity investments
All equity investments, except investments in subsidiaries and associates are measured at FVTPL. The Company may make an irrevocable election on initial recognition to present in OCI any subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
Derecognition of Financial Assets
A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company''s Balance Sheet) when:
i) The rights to receive cash flows from the asset have expired, or
ii) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of Financial Assets
The Company assess on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVTOCI debts instruments. The impairment methodology applied depends on whether there has been significant increase in credit risk. For trade receivables, the Company is not exposed to any credit risk as the possession of residential and commercial units is handed over to the buyer only after all the instalments are recovered.
For financial assets carried at amortised cost, the carrying amount is reduced and the amount of the loss is recognised in the Statement of profit and loss. Interest income on such financial assets continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Financial asset together with the associated
allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or decreased. If a write-off is later recovered, the recovery is credited to finance costs.
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liability not recorded at fair value through Profit or Loss, net of directly attributable transaction costs.
The Company''s financial liabilities include trade and other payables and loans and borrowings.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities measured at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the Statement of profit and loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to Statement of Profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated any financial liability as at fair value through profit and loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When 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 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.
Reclassification of Financial Assets and Financial Liabilities
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company''s management determines change in the business model as a result of external or internal changes which are significant to the Company''s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Ind AS Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
Fair 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
i) Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
ii) Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
iii) Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
Cash and cash equivalent in the Balance Sheet comprise 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.
The Company has applied five step model as set out in Ind AS 115 to recognise revenue in this Standalone Financial Statements. The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:
a. The customer simultaneously receives and consumes the benefits provided by the Company''s performance as the Company performs; or
b. The Company''s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
c. The Company''s performance does not create an asset with an alternative use to the Company and the entity has an enforceable right to payment for performance completed to date.
For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at point of time and over a period of time based on the conditions in the contracts with customers.
The specific revenue recognition criteria are described below:
(I) Income from Property Development
The Company has determined that the existing terms of the contract with customers does not meet the criteria to recognise revenue over a period of time. Revenue is recognized at point in time with respect to contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the application and receipt of occupancy certificate.
The Company provides rebates to the customers. Rebates are adjusted against customer dues and the revenue to be recognized. To estimate the variable consideration for the expected future rebates the company uses the âmost-likely amountâ method or âexpected value methodâ.
Contract Assets
The Company is entitled to invoice customers for construction of residential and commercial properties based on achieving a series of construction-linked milestones. A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the company performs by transferring goods or services to a customer before the payment is due, a contract asset is recognized for the earned consideration that is conditional. Any receivable which represents the Company''s right to the consideration that is unconditional is treated as a trade receivable.
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue when the Company performs under the contract.
For all debt instruments measured at amortised cost. Interest income is recorded using the effective interest rate (EIR).
Rental income arising from operating leases is accounted over the lease terms.
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period.
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Current and deferred tax are recognized as income or an expense in the Statement of Profit and Loss, except when they relate to items that are recognized in OCI, in which case, the current and deferred tax income/ expense are recognized in OCI. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if the Company has a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on the Company.
Borrowing costs that are directly attributable to long term project development activities are inventorised / capitalized as part of project cost.
All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable equity share holders to by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable equity share holders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
In arrangements where the Company is the lessor, it determines at lease inception whether the lease is a finance lease or an operating lease. Leases that transfer substantially all of the risk and rewards incidental to ownership of the underlying asset to the counterparty (the lessee) are accounted for as finance leases. Leases that do not transfer substantially all of the risks and rewards of ownership are accounted for as operating leases. Lease payments received under operating leases are recognized as income in the statement of profit and loss on a straight-line basis over the lease term or another systematic basis. The Company applies another systematic basis if that basis is more representative of the pattern in which benefit from the use of the underlying asset is diminished.
Mar 31, 2018
A Significant Accounting Policies
I Basis of Preparation
The 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, read together with the Companies (Indian Accounting Standards) Rules, 2015.
These financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in Indian Rupees (Rs.) and all values are rounded to the nearest lakhs except when otherwise indicated.
II Summary of Significant Accounting Policies
1 Current and Non-Current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:
i) Expected to be realised or intended to be sold or consumed in normal operating cycle.
ii) Held primarily for the purpose of trading
iii) Expected to be realised within twelve months after the reporting period, or
iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
i) It is expected to be settled in normal operating cycle
ii) It is held primarily for the purpose of trading
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.
The operating cycle of the Company''s real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. Assets and Liabilities are classified into current and non-current based on the operating cycle.
2 Property, Plant and Equipment
i. Recognition and measurement
All property, plant and equipment except freehold land are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisitions of the items. Cost includes freight, duties, taxes, borrowing cost and incidental expenses related to the acquisition and installation of the asset.
ii. Subsequent costs
Subsequent expenditure is capitalised only when it is probable that the future economic benefits of the expenditure will flow to the Company. All other repairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.
iii. Derecognition
The carrying amount of an item of Property, Plant and Equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is derecognized.
iv. Depreciation
Depreciation is calculated on a written down value basis over the estimated useful lives of the assets as specified in Schedule II of Companies Act, 2013 except for Site/Sales Offices and Sample Flats wherein the estimated useful lives is determined by the management.
Depreciation on assets sold during the year is charged to the Statement of Profit and Loss up to the month preceding the month of sale.
3 Inventories
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each item of inventory to its present condition are accounted for as follows:
i) Stock of Building Materials and Traded Goods is valued at lower of cost and net realizable value. Cost is generally ascertained on weighted average basis.
ii) Work-in-progress represents cost incurred in respect of unsold area of the real estate development projects and the costs incurred on the projects where the revenue is yet to be recognized.
iii) Completed unsold inventory is valued at lower of Cost and Net Realizable Value.
iv) Cost for this purpose includes cost of land, shares with occupancy rights, Transferrable Development Rights, premium for development rights, borrowing costs, construction / development cost and other overheads incidental to the projects undertaken.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale.
4 Provisions and Contingencies
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure of contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
5 Impairment of Non-Financial Assets (excluding Inventories, Investment Properties and Deferred Tax Assets)
Non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest Group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units (''CGUs'').
6. Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial Assets
Initial recognition and measurement
The Company classifies its financial assets in the following measurement categories.
- those to be measured subsequently at fair value (either through OCI, or through profit or loss)
- those measured at amortised cost
All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
i) Debt instruments at amortised cost
ii) Debt instruments at fair value through other comprehensive income (FVTOCI)
iii) Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)
iv) Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortised cost
A ''debt instrument'' is measured at the amortised cost if both the following conditions are met:
a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment if any, are recognised in the statement of profit or loss.
Debt instruments at FVTOCI
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and
b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company does not have any debt instruments which meets the criteria for measuring the debt instrument at FVTOCI.
Debt instrument at FVTPL
Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''Accounting Mismatch''). The Company has not designated any debt instrument at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
Equity investments
All equity investments, except investments in fellow subsidiaries and associates are measured at FVTPL. The Company may make an irrevocable election on initial recognition to present in OCI any subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
Derecognition of Financial Assets
A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company''s Balance Sheet) when:
i) The rights to receive cash flows from the asset have expired, or
ii) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of Financial Assets
The Company assess on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVTOCI debts instruments. The impairment methodology applied depends on whether there has been significant increase in credit risk. For trade receivables, the Company is not exposed to any credit risk as the possession of residential and commercial units is handed over to the buyer only after all the installments are recovered.
For financial assets carried at amortised cost, the carrying amount is reduced and the amount of the loss is recognised in the Statement of profit and loss. Interest income on such financial assets continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Financial asset together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or decreased. If a write-off is later recovered, the recovery is credited to finance costs.
Financial Liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liability not recorded at fair value through Profit or Loss, net of directly attributable transaction costs.
The Company''s financial liabilities include trade and other payables and loans and borrowings.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities measured at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to Statement of Profit and loss. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated any financial liability as at fair value through profit and loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the Statement of Profit and Loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.
Derecognition of Financial Liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When 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 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.
Reclassification of Financial Assets and Financial Liabilities
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company''s management determines change in the business model as a result of external or internal changes which are significant to the Company''s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Ind AS Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
7 Fair Value Measurement
Fair 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
i) Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities
ii) Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
iii) Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
8 Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise 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.
9 Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government.
The specific recognition criteria are described below:
i) Sale of Goods
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.
Revenue from Sale of Land, Transfer of Development Rights and Building Materials are recognized upon transfer of significant risks and rewards to the buyers / Customers.
ii) Income from Property Development:
Property development involves such activities of real estate development which has the same economic substance as construction contracts. Therefore, percentage completion method is applied for recognising revenue, costs and profits from transactions in property developments.
Income from property development is recognized upon transfer of all significant risks and rewards of ownership to the buyers and no significant uncertainty exists regarding the amount of consideration and ultimate collection. The point of time at which all significant risks and rewards of ownership can be considered as transferred, is determined on the basis of the terms and conditions of the agreement for sale.
The Guidance Note on Accounting under Ind AS for Real Estate Transactions requires recognition of revenue under percentage of completion method only when, all critical approvals for project commencement have been obtained, on incurring at least 25% of estimated construction and development cost (excluding land and borrowing cost), at least 25% of the total saleable area is secured by agreement or letter of allotment ( containing salient terms of agreement to sell )with buyers and receipt of 10% of the sales consideration per contract. The percentage of completion is worked out based on the total project cost incurred to the total estimated project cost including land and borrowing cost.
As the projects necessarily extend beyond one year, revision in costs and revenues estimated during the course of the contract are reflected in the accounting period in which the said estimates are revised.
Determination of revenue under the percentage of completion method necessarily involves making estimates by the Company, some of which are technical in nature, concerning, where relevant, the percentage of completion, costs to completion, the expected revenues from the project and the foreseeable losses to completion. Provision for foreseeable losses, determination of profit from real estate projects and valuation of construction work in progress is based on such estimates.
iii) Interest Income
For all debt instruments measured at amortised cost. Interest income is recorded using the effective interest rate (EIR).
10 Current Income Tax
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period
Deferred Tax
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Minimum Alternate Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal tax during the specified period.
Presentation of Current and Deferred Tax:
Current and deferred tax are recognized as income or an expense in the Statement of Profit and Loss, except when they relate to items that are recognized in OCI, in which case, the current and deferred tax income/ expense are recognized in OCI. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if the Company has a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on the Company.
11 Borrowing Costs
Borrowing costs that are directly attributable to long term project development activities are inventorised / capitalized as part of project cost.
Borrowing costs are inventorised / capitalised as part of project cost when the activities that are necessary to prepare the inventory / asset for its intended use or sale are in progress. Borrowing costs are suspended from inventorisation / capitalisation when development work on the project is interrupted for extended periods and there is no imminent certainty of recommencement of work.
All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.
12 Earnings Per Share
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable equity share holders to by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, the net profit or loss for the year and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable equity share holders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
Mar 31, 2014
A. Basis of Accounting :
The financial statements are prepared under the historical cost
convention in accordance with the generally accepted accounting
principles in India, the Accounting Standards as notifed under
Companies (Accounting Standards) Rules, 2006, read with general
circular 15/2013 of the Ministry of Corporate Affairs in respect of
section 133 of the Companies Act, 2013, the Provisions of the Companies
Act, 1956 and 2013 and on the accounting principle of going concern.
Expenses and Income to the extent considered payable and receivable,
respectively, are accounted for on accrual basis, except those with
significant uncertainties.
B. Use of Estimates :
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities on the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. The estimates are made to the best of the
management''s knowledge considering all necessary information.
Differences, if any, between actual results and estimates are
recognized in the period in which the results are ascertained.
C. Fixed Assets :
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. Cost includes all incidental expenses related
to acquisition and installation, other pre-operation expenses and
borrowing cost in case of construction.
The carrying amount of cash generating units / assets is reviewed at
the balance sheet date to determine whether there is any indication of
impairment. If such indication exists, the recoverable amount is
estimated at the net selling price or value in use, whichever is
higher. Impairment loss, if any, is recognized whenever carrying amount
exceeds the recoverable amount.
D. Depreciation :
Depreciation on Fixed Assets is provided on written down value method
at the rates specified in Schedule of the Companies Act, 1956 except for
cost of ''site / sales office and sample fats'' which are being amortized
equally over the project lifecyle / demolition, whichever is earlier.
Depreciation on Additions / Deletions of assets is provided on a
pro-rata basis.
Depreciation on assets used for construction is treated as period cost.
E. Inventories :
i) Stock of Building Materials is valued at lower of cost and net
realizable value. Cost is generally ascertained on weighted average
basis.
ii) a) Work-in-Progress is stated at Cost or Net Realizable value,
whichever is lower. Work-in-Progress includes costs of incomplete
projects for which the Company has not entered into contracts and the
costs incurred on the projects where the revenue is yet to be
recognized.
b) Completed unsold inventory is valued at lower of cost or net
realizable value.
c) Cost for this purpose includes cost of land, construction costs,
borrowing cost and other overheads incidental to the projects
undertaken.
d) Net realizable value is the estimated selling price in the ordinary
course of business.
F. Operating Cycle :
The Company''s normal operating cycle varies from project to project
depending on the size of the project, type of development, project
complexities and related approvals. Assets and liabilities are
classifed into current and non-current based on the operating cycle.
G. Revenue Recognition :
i) Income from Property Development:
a) Income from property development is recognized on the transfer of
all significant risks and rewards of ownership to the buyers and it is
not unreasonable to expect ultimate collection and no significant
uncertainty exists regarding the amount of consideration. However, if
at the time of transfer, substantial acts are yet to be performed under
the contract, revenue is recognized on proportionate basis as the act
are being performed and monies received i.e. on the percentage
completion method, on incurring at least 25% of estimated construction
and development cost excluding land and borrowing cost, atleast 25% of
the total saleable area is secured by contract with buyers and receipt
of 10% of the sales consideration per contract. The percentage of
completion is worked out based on the total project costs incurred to
total estimated project costs including land.
As the projects necessarily extend beyond one year, revision in costs
and revenues estimated during the course of the contract are refected
in the accounting period in which the said estimates are revised.
b) Determination of revenue under the percentage of completion method
necessarily involves making estimates by the Company, some of which are
of technical nature, concerning, where relevant, the percentage of
completion, costs to completion, the expected revenues from the project
and the foreseeable losses to completion. Provision for foreseeable
losses, determination of Profit from real estate projects and valuation
of construction work in progress is based on such estimates.
ii) Revenue from Sale of Building Materials is recognised when
significant risk and rewards in respect of ownership of materials are
transferred to customers.
H. Borrowing Costs :
Borrowing costs that are directly attributable to long term project
development activities are inventorised as part of project cost. Other
borrowing costs are recognized as an expense in the period in which
they are incurred.
Borrowing costs are inventorised as part of project cost when the
activities that are necessary to prepare the asset for its intended use
or sale are in progress. Inventorisation of Borrowing costs are
suspended once development work on the project is interrupted for
extended periods.
I. Foreign Exchange Transactions :
The transactions in foreign exchange are accounted at the exchange
rates prevailing on the date of transactions. All monetary assets and
liabilities in foreign currency are translated at the exchange rate
prevailing at the date of the Balance Sheet. Any exchange gain or loss
arising on the translation or settlement of such transactions are
accounted for in the Statement of Profit and Loss.
J. Leases :
Lease arrangements where the risks and rewards incidental to ownership
of assets substantially vest with the lessor are classifed as operating
leases. Operating lease payments are recognized as an expense in the
Statement of Profit and Loss on a straight-line basis over the lease
term.
K. Taxation :
Provision for the current income tax is made on the basis of the
estimated taxable income for the current accounting year in accordance
with Income Tax Act, 1961.
MAT credit asset is recognized and carried forward only if there is a
reasonable certainty of it being set off against regular tax payable
within the stipulated statutory period.
Deferred Tax resulting from timing differences between book and tax
Profits is accounted for under the liability method, at the tax rate and
tax laws enacted or substantively enacted at the balance sheet date, to
the extent that the timing differences are expected to crystallize.
Deferred tax assets are recognized and carried forward only if there is
a virtual / reasonable certainty that they will be realized and are
reviewed for the appropriateness of their respective carrying values at
each balance sheet date.
L. Provisions and Contingent Liabilities :
Provisions are recognized in the accounts in respect of present
probable obligation, the amount of which can be reliably estimated.
Contingent liabilities are disclosed in respect of possible obligations
that arise from past events but their existence is confirmed by the
occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the Company.
Mar 31, 2013
A. Basis of Accounting :
The Financial Statements are prepared under the historical cost
convention, in accordance with the generally accepted accounting
principles in India, the Accounting Standards as specified in the
Companies (Accounting Standards) Rules, 2006, the Provisions of the
Companies Act, 1956 and on the accounting principle of going concern.
Expenses and Income to the extent considered payable and receivable,
respectively, are accounted for on accrual basis, except those with
significant uncertainties.
B. Use of Estimates :
The preparation of Financial Statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities on the date of the
Financial Statements and the reported amounts of revenues and expenses
during the reporting period. The estimates are made to the best of the
management''s knowledge considering all necessary information.
Differences, if any, between actual results and estimates are
recognized in the period in which the results are ascertained.
C. Fixed Assets :
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. Cost includes all incidental expenses related
to acquisition and installation, other pre-operation expenses and
interest in case of construction.
The carrying amount of cash generating units / assets is reviewed at
the balance sheet date to determine whether there is any indication of
impairment. If such indication exists, the recoverable amount is
estimated at the net selling price or value in use, whichever is
higher. Impairment loss, if any, is recognized whenever carrying amount
exceeds the recoverable amount.
D. Depreciation :
Depreciation on Fixed Assets is provided on written down value method
at the rates specified in Schedule XIV of the Companies Act, 1956
except for cost of ''site / sales office and sample flats'' which is
amortized equally over a period of five years or project completion /
demolition whichever is earlier.
Depreciation on Additions / Deletions of assets during the year is
provided on a pro-rata basis.
The depreciation on assets used for construction is treated as period
cost.
E. Inventories :
a. Stock of Building Materials is valued at lower of cost and net
realizable value. Cost is generally ascertained on weighted average
basis.
b. i. Work-in-Progress is stated at Cost or Net Realizable value,
whichever is lower. Work-in-Progress includes costs
of incomplete projects for which the Company has not entered into
contracts and the costs incurred on the projects where the revenue is
yet to be recognized.
ii. Completed unsold inventory is valued at lower of cost or net
realizable value.
iii. Cost for this purpose includes cost of land and development
rights, construction, and interest overheads and expenses incidental to
the project undertaken.
iv. Net realizable value is the estimated selling price in the
ordinary course of business.
F. Operating Cycle :
The Company''s normal operating cycle varies from project to project
depending on the size of the project, type of development, project
complexities and related approvals. Assets and liabilities have been
classified into current and non- current based on the operating cycle.
G. Revenue Recognition :
a) Income from property development is recognized on the transfer of
all significant risks and rewards of ownership to the buyers and it is
not unreasonable to expect ultimate collection and no significant
uncertainty exists regarding the amount of consideration. However, if
at the time of transfer, substantial acts are yet to be performed under
the
contract, revenue is recognized on proportionate basis as the act are
being performed and monies received i.e. on the percentage completion
method on incurring at least 25% of estimated construction and
development cost excluding land and borrowing cost, at least 25% of the
total saleable area is secured by contract with buyers and receipt of
10% of the sales consideration per contract. The percentage of
completion is worked out based on the total project costs incurred to
total estimated project costs including land.
As the projects necessarily extend beyond one year, revision in costs
and revenues estimated during the course of the contract are reflected
in the accounting period in which the said estimates are revised.
b) Determination of revenue under the percentage of completion method
necessarily involves making estimates by the Company, some of which are
of technical nature, concerning, where relevant, the percentage of
completion, costs to completion, and the expected revenues from the
project and the foreseeable losses to completion. Provision for
foreseeable losses, determination of profit from real estate projects
and valuation of construction work in progress is based on such
estimates.
c) Revenue from Sale of Building materials is recognized when
significant risks and rewards in respect of ownership of materials are
transferred to customers.
H. Borrowing Costs :
Borrowing costs that are directly attributable to long term project
management and development activities are inventoried as part of
project cost. Other borrowing costs are recognized as expense in the
period in which they are incurred.
Borrowing costs are inventoried as part of project cost when the
activities that are necessary to prepare the inventory for its intended
use or sale are in progress. Borrowing costs are suspended from
inventorisation on the project when development work on the project is
interrupted for extended periods and there is no imminent certainty of
recommencement of work.
I. Foreign Exchange Transactions :
The transactions in foreign exchange are accounted at the exchange
rates prevailing on the date of transactions. All monetary assets and
liabilities in foreign currency are translated at the exchange rate
prevailing at the date of the Balance Sheet. Any exchange gains or
losses arising on the translation or settlement of such transaction are
accounted for in the Statement of Profit and Loss.
J. Leases
Lease arrangements where the risks and rewards incidental to ownership
of assets substantially vest with the lessor are classified as
operating leases. Operating lease payments are recognized as an expense
in the Statement of Profit and Loss on a straight-line basis over the
lease term, unless there is another systematic basis which is more
representative of the time pattern of the lease.
K. Taxation :
Provision for the current income tax is made on the basis of the
estimated taxable income for the current accounting year in accordance
with Income Tax Act, 1961.
MAT credit asset is recognized and carried forward only if there is a
reasonable certainty of it being set off against regular tax payable
within the stipulated statutory period.
Deferred Tax resulting from timing differences between book and tax
profits is accounted for under the liability method, at the tax rate
and tax laws enacted or substantively enacted at the balance sheet
date, to the extent that the timing differences are expected to
crystallize. Deferred tax assets are recognized and carried forward
only if there is a virtual / reasonable certainty that they will be
realized and are reviewed for the appropriateness of their respective
carrying values at each balance sheet date.
L. Provisions, Contingent Liabilities and Contingent Assets :
Provisions are recognized in the accounts in respect of present
probable obligation, the amount of which can be reliably estimated.
Contingent liabilities are disclosed in respect of possible obligations
that arise from past events but their existence is confirmed by the
occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the company.
Mar 31, 2012
A. Basis of Accounting :
The Financial Statements are prepared under the historical cost
convention, in accordance with the generally accepted accounting
principles in India, the Accounting Standards as specified in the
Companies (Accounting Standards) Rules, 2006, the Provisions of the
Companies Act, 1956 and on the accounting principle of going concern.
Expenses and Income to the extent considered payable and receivable,
respectively, are accounted for on accrual basis, except those with
significant uncertainties.
B. Use of Estimates :
The preparation of Financial Statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities on the date of the
Financial Statements and the reported amounts of revenues and expenses
during the reporting period. The estimates are made to the best of the
management s knowledge considering all necessary information.
Differences, if any, between actual results and estimates are
recognized in the period in which the results are ascertained.
C. Fixed Assets :
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. Cost includes all incidental expenses related
to acquisition and installation, other pre-operation expenses and
interest in case of construction.
The carrying amount of cash generating units / assets is reviewed at
the balance sheet date to determine whether there is any indication of
impairment. If such indication exists, the recoverable amount is
estimated at the net selling price or value in use, whichever is
higher. Impairment loss, if any, is recognized whenever carrying amount
exceeds the recoverable amount.
D. Depreciation :
Depreciation on Fixed Assets is provided on written down value method
at the rates specified in Schedule XIV of the Companies Act, 1956
except for cost of Ãsite / sales office and sample fiats' which is
amortized equally over a period of five years or project completion /
demolition whichever is earlier.
Depreciation on Additions / Deletions of assets during the year is
provided on a pro-rata basis.
The depreciation on assets used for construction is treated as period
cost.
E. Investments :
Investments are classified into Long term and Current Investment.
Long term investments are carried at cost. Provision for diminution, if
any, in the value of each long term investment is made to recognize a
decline, other than of temporary nature.
Current investment are carried individually at lower of cost and fair
value and the resultant decline, if any, is charged to revenue.
F. Inventories:
a. Stock of Building Materials is valued at lower of cost and net
realizable value. Cost is generally ascertained on weighted average
basis.
b. i. Work-in-progress is stated at Cost or Net Realizable value,
whichever is lower. Work-in Progress includes costs
of incomplete projects for which the Company has not entered into sale
agreements and the costs incurred on the projects where the revenue is
yet to be recognized (before the work has progressed to the extent of
30% of the total work involved and 20% of the sales consideration is
yet to be received).
ii. Completed unsold inventory is valued at lower of cost or net
realizable value.
iii. Cost for this purpose includes cost of land and development
rights, construction, interest overheads and expenses incidental to the
project undertaken.
iv. Net realizable value is the estimated selling price in the
ordinary course of business.
G. Operating Cycle :
The Company's normal operating cycle varies from project to project
depending on the size of the project, type of development, project
complexities and related approvals. Assets and liabilities have been
classified into current and non- current based on the operating cycle.
H. Revenue Recognition :
a) Income from property development is recognized on the transfer of
all significant risks and rewards of ownership to the buyers and it is
not unreasonable to expect ultimate collection and no significant
uncertainty exists regarding the amount of consideration. However, if
at the time of transfer substantial acts are yet to be performed under
the contract, revenue is recognized on proportionate basis as the act
are being performed and monies received i.e. on the percentage of
completion method on achieving at least 30% of physical progress of
project and receipt of 20% of the saies consideration. The percentage
of completion is stated on the basis of physical measurement of work
actually completed as at the balance sheet date and certified by the
Architect. As the long-term contracts necessarily extend beyond one
year, revision in costs and revenues estimated during the course of the
contract are reflected in the accounting period in which the facts
requiring the revision become known. Revenue is not recognised on units
cancelled upto a reasonable date close to the date of approval of the
Financial Statements and Hence, such cancelled units are included in
the inventory.
b) Determination of revenues under the percentage of completion method
necessarily involves making estimates by the Company, some of which are
of technical nature, concerning, where relevant, the percentage of
completion, costs to completion, the expected revenues from the project
and the foreseeable losses to completion. Profit from real estate
projects and valuation of construction work in progress is based on
such estimates.
I. Borrowing Costs :
Borrowing costs that are directly attributable to long term project
management and development activities are inventoried as part of
project cost Other borrowing costs are recognized as expense in the
period in which they are incurred.
Borrowing costs are inventoried as part of project cost when the
activities that are necessary to prepare the inventory for its intended
use or sale are in progress. Borrowing costs are suspended from
inventorisation on the project when development work on the project is
interrupted for extended periods and there is no imminent certainty of
recommencement of work.
J. Taxation:
Provision for the current income tax is made on the basis of the
estimated taxable income for the current accounting year in accordance
with Income Tax Act, 1961.
MAT credit asset is recognized and carried forward only if there is a
reasonable certainty of it being set off against regular tax payable
within the stipulated statutory period.
Deferred Tax resulting from timing differences between book and tax
profits is accounted for under the liability method, at the tax rate
and tax laws enacted or substantively enacted at the balance sheet
date, to the extent that the timing differences are expected to
crystallize. Deferred tax assets are recognized and carried forward
only if there is a virtual / reasonable certainty that they will be
realized and are reviewed for the appropriateness of their respective
carrying values at each balance sheet date.
K. Foreign Exchange Transactions .
The transactions in foreign exchange are accounted at the exchange
rates prevailing on the date of transactions. All monetary assets and
liabilities in foreign currency are translated at the exchange rate
prevailing at the date of the Balance Sheet. Any exchange gains or
losses arising on the translation or settlement of such transaction are
accounted for in the Statement of Profit and Loss.
L. Provisions, Contingent Liabilities and Contingent Assets :
Provisions are recognized in the accounts in respect of present
probable obligation, the amount of which can be reliably estimated.
Contingent liabilities are disclosed in respect of possible obligations
that arise from past events but their existence is confirmed by the
occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the company.
Mar 31, 2011
1. BASIS OF ACCOUNTING
The financial statements are prepared under the historical cost
convention, in accordance with the generally accepted accounting
principles in India, the Accounting Standards as specified in the
Companies (Accounting Standards) Rules, 2006, the Provisions of the
Companies Act, 1956 and on the accounting principle of going concern.
Expenses and Income to the extent considered payable and receivable,
respectively, are accounted for on accrual basis, except those with
significant uncertainties.
2. USE OF ESTIMATES
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities on the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. The estimates are made to the best of the
management's knowledge considering all necessary information.
Differences, if any, between actual results and estimates are
recognized in the period in which the results are ascertained.
3. FIXED ASSETS
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. Cost includes all incidental expenses related
to acquisition and installation, other pre-operation expenses and
interest in case of construction.
The carrying amount of cash generating units / assets is reviewed at
the balance sheet date to determine whether there is any indication of
impairment. If such indication exists, the recoverable amount is
estimated at the net selling price or value in use, whichever is
higher. Impairment loss, if any, is recognized whenever carrying amount
exceeds the recoverable amount.
4. DEPRECIATION
Depreciation on Fixed Assets is provided on written down value method
at the rates specified in Schedule XIV of the Companies Act, 1956
except for cost of 'site / sales' office and sample flats which are
being amortized equally over a period of five years or project
completion / demolition whichever is earlier and intangible assets
which are amortized proportionately over period of five years.
Depreciation on Additions / Deletions of assets during the year is
provided on a pro-rata basis.
The depreciation on assets used for construction is treated as period
cost.
5. INVESTMENTS
Investments are classified into Long term and Current Investment. Long
term investments are carried at cost, Provision for diminution, if any,
in the value of each long term investment is made to recognize a
decline, other than of temporary nature. Current investment are
carried individually at lower of cost and fair value and the resultant
decline, if any, is charged to revenue.
6. INVENTORIES
a. Stock of Building Materials is valued at lower of cost and net
realizable value. Cost is generally ascertained on average basis.
b. i. Work-in-progress is stated at Cost or Net Realizable value,
whichever is lower. Work-in Progress includes costs of
incomplete projects for which the Company has not entered into sale
agreements and the costs incurred on the projects where the revenue is
yet to be recognized (before the work has progressed to the extent of
30% of the total work involved and 20% of the sales consideration is
yet to be received).
ii. Completed unsold inventory is valued at lower of cost or net
realizable value.
iii. Cost for this purpose includes cost of land & development rights,
construction, interest overheads and expenses incidental to the project
undertaken.
iv. Net realizable value is the estimated net sales value in the
ordinary course of business.
7. REVENUE RECOGNITION
a) Income from property development is recognized on the transfer of
all significant risks and rewards of ownership to the buyers and it is
not unreasonable to expect ultimate collection and no significant
uncertainty exists regarding the amount of consideration. However, if
at the time of transfer substantial acts are yet to be performed
under the contract, revenue is recognized on proportionate basis as the
act are being performed and monies received i.e. on the percentage of
completion method on achieving at least 30% percent of physical
progress of project and receipt of 20% of the sales consideration. The
percentage of completion is stated on the basis of physical measurement
of work actually completed as at the balance sheet date and certified
by the Architect. As the long-term contracts necessarily extend beyond
one year, revision in costs and revenues estimated during the course of
the contract are reflected in the accounting period in which the facts
requiring the revision become known
b) Determination of revenues under the percentage of completion method
necessarily involves making estimates by the Company, some of which are
of technical nature, concerning, where relevant, the percentage of
completion, costs to completion, the expected revenues from the project
and the foreseeable losses to completion. Profit from real estate
projects and valuation of construction work in progress is based on
such estimates.
8. BORROWING COSTS:
Borrowing costs that are directly attributable to long term project
management and development activities are inventorised / capitalized as
part of project cost. Other borrowing costs are recognised as expense
in the period in which they are incurred.
Borrowing costs are inventorised / capitalized as part of project cost
when the activities that are necessary to prepare the inventory / asset
for its intended use or sale are in progress. Borrowing costs are
suspended from inventorisation / capitalization on the project when
development work on the project is interrupted for extended periods.
9. TAXATION:
Provision for the current income tax is made on the basis of the
estimated taxable income for the current accounting year in accordance
with Income Tax Act, 1961.
MAT credit asset is recognized and carried forward only if there is a
reasonable certainty of it being set off against regular tax payable
within the stipulated statutory period.
Deferred Tax resulting from timing differences between book and tax
profits is accounted for under the liability method, at the tax rate
and tax laws enacted or substantially enacted at the balance sheet
date, to the extent that the timing differences are expected to
crystallize. Deferred tax assets are recognized and carried forward
only if there is a virtual/reasonable certainty that they will be
realized and are reviewed for the appropriateness of their respective
carrying values at each balance sheet date.
10. FOREIGN EXCHANGE FLUCTUATION
The transactions in foreign exchange are accounted at the exchange
rates prevailing on the date of transactions. Current assets and
liabilities in foreign in foreign currency are translated at the
exchange rate prevailing at the date of the Balance Sheet. Any exchange
gains or losses arising out of the subsequent fluctuations are
accounted for in the Profit and Loss Account.
11. EMPLOYEE BENEFITS
Expenses and liabilities in respect of employee benefits are recorded
in accordance with Revised Accounting Standard 15 - Employee Benefits:
a. Provident Fund
The Company makes contribution to statutory provident fund in
accordance with Employees Provident Fund and Miscellaneous Provisions
Act, 1952 which is a defined contribution plan and contribution paid or
payable is recognized as an expense in the period in which services are
rendered by the employee.
b. Gratuity
Gratuity is a post employment benefit and is in the nature of defined
benefit plan. The liability recognized in the balance sheet in respect
of gratuity is the present value of the defined benefit /obligation at
the balance sheet date less the fair value of plan assets, together
with any adjustments for unrecognized actuarial gains or losses and
past service costs. The defined benefit/obligation is calculated at or
near the balance sheet date by an independent Actuary using the
projected unit credit method. Actuarial gains and losses arising from
the past experience and changes in actuarial assumptions are charged or
credited to the Profit and loss account in the year to which such gains
or losses relate.
c. Leave Entitlement
Liability in respect of earned leave expected to become due or expected
to be availed within one year from the balance sheet date is recognized
on the basis of undiscounted value of benefit expected to be availed by
the employees. Liability in respect of earned leave expected to become
due or expected to be availed more than one year after the balance
sheet date is estimated on the basis of actuarial valuation performed
by an independent Actuary using the projected unit credit method.
d. Other Short Term Benefits
Expense in respect of other short term benefits is recognized on the
basis of the amount paid or payable for the period during which
services are rendered by the employee.
12. PROVISIONS. CONTINGENT LIABILITIES & CONTINGENT ASSETS
Provisions are recognized in the accounts in respect of present
probable obligation, the amount of which can be reliably estimated.
Contingent liabilities are disclosed in respect of possible obligations
that arise from past events but their existence is confirmed by the
occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the company.
Mar 31, 2010
1) GENERAL
a) In view of divestment of all industrial businesses of the Company,
the Company is no longer an industrial Company.
b) The financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles ("GAAP") under the historical
cost convention on the accounting principles of a going concern and the
Company follows mercantile system of accounting and recognizes income
and expenditure on accrual basis except those with significant
uncertainties. GAAP comprises mandatory accounting standards issued by
the Institute of Chartered Accountants of India ("ICAI"), the
provisions of the Companies Act, 1956 and guidelines issued by the
Securities and Exchange Board of India. Accounting policies have been
consistently applied except where a newly issued accounting standard is
initially adopted or a revision to an existing accounting standard
requires a change in accounting policy hitherto in use.
c) The preparation of financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the
reported amount of assets, liabilities, revenues and expenses and
disclosure of contingent liabilities on the date of financial
statements. The recognition, measurement, classification or disclosure
of an item or information in the financial statements are made relying
on these estimates. Any revision to accounting estimates is recognized
prospectively.
2) FIXED ASSETS
Fixed Assets are stated at cost net of CENVAT / Value Added Tax less
accumulated depreciation and impairment losses, if any. Cost comprises
the purchase price and any directly attributable cost of bringing the
asset in its working condition for its intended use. Financing costs
relating to acquisition of qualifying fixed assets are also included to
the extent they relate to the period till such assets are ready for
their intended use.
Expenditure during construction period in respect of new project/
expansion is allocated to the respective fixed assets on their being
ready for commercial use.
3) IMPAIRMENT OF ASSETS
In accordance with AS 28 on Impairment of Assets issued by The
Institute of Chartered Accountants of India, where there is an
indication of impairment of the Companys assets related to cash
generating units, the carrying amounts of such assets are reviewed at
each balance sheet date to determine whether there is any impairment.
The recoverable amount of such assets is estimated as the higher of its
net selling price and its value in use. An impairment loss is
recognized in the Profit & Loss Account whenever the carrying amount of
such assets exceeds its recoverable amount.
4) INVESTMENTS
Investments are either classified as current or long-term based on the
managements intention at the time of purchase. Long-term investments
are carried at cost and provision is made to recognize any decline,
other than temporary, in the value of such investments. Current
investments are carried at the lower of the cost and fair value and
provision is made to recognize any decline in the carrying value.
5) REVENUE RECOGNITION
Revenue is recognized when the property and all the significant risks
and rewards of ownership are transferred to the buyer and no
significant uncertainty exists regarding the amount of consideration.
Local sales are exclusive of excise duty and sales tax.
Service income is recognized as per the agreements with the customers.
6) BORROWING COST
Borrowing Costs directly attributable to acquisition and construction
of qualifying assets are capitalised as a part of the cost of such
asset upto the date when such asset is ready for its intended use.
Other borrowing costs are charged to Profit & Loss Account.
7) DEPRECIATION
Depreciation is provided on "Written Down Value Method" at the rates
and in the manner prescribed in Schedule XIV to the Companies Act, 1956
read with relevant circulars issued from time to time by the Department
of Company Affairs.
Leasehold Land is amortised over the period of the lease
Individual assets costing less than Rs. 5,000 are depreciated in full
in the year of acquisition.
Depreciation on additions / deletions of assets during the year in
provided on pro-rata basis.
8) EMPLOYEE BENEFITS
a) Provident Fund
Provident Fund is a defined contribution scheme and contributions are
charged to the Profit and Loss Account as incurred.
b) Gratuity
Accounted for on accrual basis in respect of all employees as per the
rules of the Company.
c) Liability for leave entitlement is accounted for on accrual basis in
respect of all employees as per the rules of the Company.
9) FOREIGN CURRENCY TRANSACTIONS
Transactions in foreign currencies are recorded in the reporting
currency, by applying to the foreign currency amount the exchange rate
between the reporting currency and the foreign currency at the date of
transaction.
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are carried in terms of historical cost
denominated in a foreign currency are reported using the exchange rate
at the date of transaction; and non-monetary items which are carried at
fair value or other similar valuation denominated in a foreign currency
are reported using the exchange rate that existed when the values were
determined.
Exchange differences arising on the settlement of monetary items or on
reporting companys monetary items at rates different from those at
which they were initially recorded during the year, or reported in the
previous financial statements, are recognized as income or expense in
the year in which they arise.
10) TAXATION
Income tax expenses comprise current tax (i.e., amount of tax for the
year determined in accordance with the income tax law) and deferred tax
charges or credit (reflecting the tax effects of timing differences
between accounting income and taxable income of the year).
The deferred tax charge or credit and the corresponding deferred tax
liabilities or assets are recognized using the tax rates that have been
enacted or substantively enacted by the balance sheet date. Deferred
tax on assets are recognized and carried forward only if there is a
virtual / reasonable certainty of realization of such assets in near
future and are reviewed for their appropriateness of their respective
carrying value at each balance sheet date.
Tax credit is recognized in respect of Minimum Alternate Tax (MAT) paid
in terms of Section 115JAA of the Income Tax Act, 1961 based on
convincing evidence that the Company will pay normal tax within the
statutory time frame and the same is reviewed at each Balance Sheet
date.
11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
A provision is made based on a reliable estimate when it is probable
that an outflow of resources embodying economic benefits will be
required to settle an obligation. Contingent liabilities are disclosed
in the notes to accounts and are determined based on the management
perception that these liabilities are not likely to materialise.
Contingent assets are not recognised or disclosed in the financial
statements.
12) MISCELLANEOUS EXPENDITURE
Deferred Revenue Expense represents the compensation paid under
Voluntary Retirement Scheme is written of over the period during which
benefits therefrom are expected to be derived but not beyond 31st
March, 2010.
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article
National Standard (India) Ltd. குறித்த கூடுதல் தகவல்களை
-
National Standard (India) Ltd. நிறுவன தகவல்கள்
- நிறுவன சுயவிவரம்
- நிறுவன வரலாறு
- நிர்வாக குழு
- மூலதன வடிவம்
- புராடெக்ட் மிக்ஸ்
- வங்கியாளர்/தணிக்கையாளர்/பதிவாளர்
-
நிறுவன வரலாறு
- போனஸ்
- உரிமை
- மும்பை பங்குச் சந்தையில் விலை வரலாறு
-
National Standard (India) Ltd. முக்கிய நிதியில் விகிதங்கள்
- விகிதங்கள்
-
National Standard (India) Ltd. முடிவுகள்
- காலாண்டு முடிவுகள்
- அரையாண்டு முடிவுகள்
- 9 மாத முடிவுகள்
- வருடாந்திர முடிவுகள்
-
National Standard (India) Ltd. நிதியியல் தகவல்கள்
- தணிக்கை முடிவுகள்
- பணப்பாய்வு
- இருப்பு நிலைக்குறிப்பு
-
National Standard (India) Ltd. அறிக்கை
- கணக்கியல் கோட்பாடுகள்
- தணிக்கையாளர்கள் அறிக்கை
- இயக்குநர்கள் அறிக்கை
- கணக்கு குறிப்புகள்
-
National Standard (India) Ltd. கார்ப்பரேட் அறிவிப்புகள்
- புத்தக முடிவு
- ஈவுத்தொகை
- நிர்வாகக் குழுக் கூட்டங்கள்
-
பங்குச் சந்தை நிலநடுக்கங்கள்: 10 ஆண்டுகளில் முதலீட்டாளர்களை அதிர வைத்த 5 பெரும் சரிவுகள்?! -
ரத்தகளறியான இந்திய பங்குச்சந்தை.. ரூ.12 லட்சம் கோடி இழப்பு.. கதறி அழும் முதலீட்டாளர்கள்..! -
ஓரே நாளில் 6.5 லட்சம் கோடி இழப்பு.. கதறும் பங்குச்சந்தை முதலீட்டாளர்கள்..!! -
சென்செக்ஸ் 6,000 புள்ளிகள் சரிவிலிருந்து மீண்டது.. இந்திய சந்தைக்கு ‘டபுள் ஷாக்’..!! -
நிஃப்டி காட்டும் பளபளப்பு நிஜமா? 80% பங்குகள் கரடியின் பிடியில் - முதலீட்டாளர்களே உஷார்! -
அமெரிக்க 15% இறக்குமதி வரி உயர்வு: டிரம்ப் அறிவிப்பால் நாளை சென்செக்ஸ், நிஃப்டி நிலைமை என்ன..? -
இது வம்பை விலை கொடுத்து வாங்கும் கதை.. பங்குச்சந்தை நம்பி போக வேண்டாம்.. வார்னிங் கொடுக்கும் எக்ஸ்பர்ட்..!! -
வெள்ளிக்கிழமையும், 13ஆம் தேதியும்.. 7.4 லட்சம் கோடி ஏப்பம் விட்ட மும்பை பங்குச்சந்தை! சென்செக்ஸ், நிப்டி சரிவு -
பிப்ரவரி 12 பாரத் பந்த்: வங்கி, பங்குச் சந்தை, பள்ளிகள், கல்லூரிகள் மூடப்படுமா.. உண்மை நிலவரம் என்ன? -
2026ஆம் ஆண்டு இறுதிக்குள் நிஃப்டி 50 நிச்சயம் 29,000 புள்ளிகளை எட்டும்: நிபுணர்கள் உறுதி -
சென்செக்ஸ், நிஃப்டி தலைகீழாக மாறியது.. எல்லாம் டிரம்ப் செய்த மாயம்.. கைகொடுத்த DII, அப்போ FII? -
படுத்து கிடக்கும் பங்குச்சந்தை பட்ஜெட்டிற்கு பிறகாவது எழுந்து வருமா? கடந்த ஆண்டுகளில் நடந்தது என்ன? -
15 நிமிடங்களில் ரூ.4 லட்சம் கோடி காலி! ஆட்டம் கண்ட சென்செக்ஸ்.. ரத்தக் களறியான இந்திய பங்குச்சந்தை! -
முதலீட்டாளர்களே உஷார்! பட்ஜெட் நாள் வெறும் சீன் தான்-15 ஆண்டு நிஃப்டி தரவு சொல்லும் ஷாக்கிங் உண்மை! -
சென்செக்ஸ் 1000 புள்ளிகள் சரிவு.. 3 நாளில் ரூ.18 லட்சம் கோடி இழப்பு..!! -
8 மாதங்களில் இல்லாத மிகப்பெரிய வீழ்ச்சி: ஒரே நாளில் 713 பங்குகள் அதல பாதாளத்திற்கு சென்றது ஏன்?
-
Block for 8 hours
-
Block for 12 hours
-
Block for 24 hours
-
Don't block
Sign in with Google- Male
- Female
- Others
- Under 18
- 18 to 25
- 26 to 35
- 36 to 45
- 45 to 55
- 55+