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Aagam Capital Ltd. कंपली की लेखा नीति

Mar 31, 2014

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 of India (the ''Act'') and the relevant provisions of the Act and the regulations of Reserve Bank of India to the extent applicable. The significant accounting policies are as follows:

a. Basis of preparation of Financial Statements

The financial statements are prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation/ Amortisation

Fixed Assets are stated at Cost less Depreciation. The Company capitalises all cost relating to acquisition and installation of Fixed Assets.

Depreciation is provided on Straight Line Method, pro rata for the period of use, at the rates specified in Schedule XIV to the Act or based on rates as per useful life of asset, whichever is higher.

Assets costing Rs. 5,000 or less are fully depreciated in the year of acquisition.

c. Investments

Investments are classified as long term or current based on management''s intention at the time of purchase. Investments which are intended to be held for one year or more are classified as long term investments and investments which are intended to be held for less than one year are classified as current investments.

Long term investments are recorded at cost as on the date of transaction and any decline in the carrying value other than temporary in nature is provided for. Current investments are valued at cost or market/fair value, whichever is lower.

d. Revenue Recognition

i. Interest income is accounted on accrual basis.

ii. Dividend income is recognised when the right to receive dividend is established.

iii. Realised gains and losses in respect of equity securities and units of mutual funds are calculated as the difference between the net sales proceeds and their cost. Cost in respect of equity shares and units of mutual funds are computed using first in first out (FIFO) method.

e. Use of Estimates

The preparation of financial statements are in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known /materialised.

f. Equity Index / Stock Futures.

i) Margin Deposits representing margin paid for entering into a contract for equity index/stock futures which are released on final settlement/squaring up of the underlying contract, are disclosed under Loans and advances.

ii) Equity index/stock futures are marked to market on a daily basis. Debit or credit balance disclosed under Loans and Advances or Current Liabilities respectively in the "Mark- to- Market Margin - Equity Index/Stock Futures account " represents the net amount paid or received on the basis of movement in the prices of index/stock futures till the Balance Sheet date.

iii) As on the Balance Sheet date profit/loss on open positions in equity index/stock futures in accounted for as follows:

* Credit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account" being the anticipated profit is ignored and no credit for the same is taken in the Profit and Loss Account.

* Debit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account", being the anticipated loss is adjusted in the Profit and Loss Account.

iv) On final settlement or squaring up of contracts for equity index/stock futures the profit or loss is calculated as the difference between the settlement/squaring up price and the contract price. Accordingly debit or credit balance pertaining to the settled/squared up contract in "Mark-to- Market Margin - Equity Index/stock Futures Account", after adjustment of the provision for anticipated losses is recognised in the Profit and Loss Account.

g. Equity Index / Stock Options

i) "Equity Index/Stock option premium account" represents premium paid or received for buying or selling the options, respectively.

ii) Margin deposits representing margin paid for entering into contract for equity index /stock options which are released on final settlement/squaring up of the underlying contracts are disclosed under Loans and Advances.

iii) As at the Balance Sheet date in the case of long positions provision is made for the amount by which the premium paid for those options exceeds the premium prevailing on the balance sheet date, and in the case of short positions for the amount by which the premium prevailing on the balance sheet date exceeds the premium received for those options and is reflected in "Provision for loss on equity Index/Stock Options Account."

iv) When the option contracts are squared up before the expiry of the options the premium prevailing on that date is recognised in the Profit and Loss Account.

On the expiry of the contracts and on exercising the options the difference between the final settlement price and the strike price is transferred to the Profit and Loss Account.

In both the cases, the premium paid or received for buying or selling the option as the case may be is recognized in the profit and loss account for the squared-up/settled contracts.

h. Taxes on Income

Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. Minimum Alternate Tax (MAT) eligible for set off in subsequent years, (as per tax laws) is recognized as an asset by way of credit to the Profit and Loss Account only if there is convincing evidence of its realisation. At each balance sheet date, the carrying amount of MAT Credit Entitlement receivable is reviewed to reassure realisation.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognised mainly on account of unabsorbed depreciation and carry forward of losses to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

I. Inventories

Inventory consists of shares and securities purchased for trading purposes. These are valued at lower of cost or net realizable value. Cost is computed on FIFO basis. For the purpose of determining net realizable value, the last quoted closing prices at the Bombay Stock Exchange Limited (''BSE'') are considered.

j. Employee Benefits

Defined Contribution Plans such as Provident Fund etc. are charged to the Profit & Loss Account as incurred.

Defined Benefit Plans - The present value of the obligation under such plan was determined based on an actuarial valuation which was carried out by an independent actuary. The actuarial valuation method used by the independent actuary for measuring the liability was the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation was recognized immediately in the Profit & Loss Account. However during the year as there is only one employee, the company has worked out the gratuity liability without actuarial valuation. The liability for the same is provided in the accounts.

Other Long term Employee Benefits are recognized in the same manner as Defined Benefit Plans. Termination benefits are recognized as and when incurred.

k. Operating Lease

Lease payments for assets on operating lease are recognized as an expense in Profit & Loss Account in accordance with Accounting Standard 19 - Leases.

l. Provisions and Contingent Liabilities

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resource is remote, no provision or disclosure is made.

m. Impairment of Assets

The Company follows the Prudential Norms for Assets Classification, Income Recognition, Accounting Standards, Provision for non-performing assets as prescribed by the Reserve Bank of India under Non-Banking Financial (Non deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. During the year, these norms have been amended, mandating 0.25% provision against the outstanding standard assets.


Mar 31, 2013

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 of India (the''Act'') and the relevant provisions of the Act and the regulations of Reserve Bank of India to the extent applicable. The significant accounting policies are as follows:

a. Basis of preparation of Financial Statements

The financial statements are prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation/ Amortisation

Fixed Assets are stated at Cost less Depreciation. The Company capitalises all cost relating to acquisition and installation of Fixed Assets.

Depreciation is provided on Straight Line Method, pro rata for the period of use, at the rates specified in Schedule XIV to the Act or based on rates as per useful life of asset, whichever is higher. Air conditioners and office equipment are depreciated over 7 years, which is different from rates specified from Schedule XIV.

Leasehold improvements are depreciated on straight line basis over the period of lease.

Assets costing Rs. 5,000 or less are fully depreciated in the year of acquisition.

c. Investments

Investments are classified as long term or current based on management''s intention at the time of purchase. Investments which are intended to be held for one year or more are classified as long term investments and investments which are intended to be held for less than one year are classified as current investments.

Long term investments are recorded at cost as on the date of transaction and any decline in the carrying value other than temporary in nature is provided for. Current investments are valued at cost or market/fair value, whichever is lower.

d. Revenue Recognition

i. Interest income is accounted on accrual basis.

ii. Dividend income is recognised when the right to receive dividend is established.

iii. Realised gains and losses in respect of equity securities and units of mutual funds are calculated as the difference between the net sales proceeds and their cost. Cost in respect of equity shares and units of mutual funds are computed using first in first out (FIFO) method.

e. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known /materialised.

f. Equity Index/Stock Futures.

i) Margin Deposits representing margin paid for entering into a contract for equity index/stock futures which are released on final settlement/squaring up of the underlying contract, are disclosed under Loans and advances.

ii) Equity index/stock futures are marked to market on a daily basis. Debit or credit balance disclosed under Loans and Advances or Current Liabilities respectively in the "Mark- to- Market Margin - Equity Index/Stock Futures account " represents the net amount paid or received on the basis of movement in the prices of index/stock futures till the Balance Sheet date.

iii) As on the Balance Sheet date profit/loss on open positions in equity index/stock futures in accounted for as follows:

Credit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account" being the anticipated profit is ignored and no credit for the same is taken in the Profit and Loss Account. Debit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account", being the anticipated loss is adjusted in the Profit and Loss Account.

iv) On final settlement or squaring up of contracts for equity index/stock futures the profit or loss is calculated as the difference between the settlement/squaring up price and the contract price. Accordingly debit or credit balance pertaining to the settled/squared up contract in "Mark-to- Market Margin - Equity Index/stock Futures Account", after adjustment of the provision for anticipated losses is recognised in the Profit and Loss Account.

g. Equity Index/Stock Options

i) "Equity Index/Stock option premium account" represents premium paid or received for buying or selling the options, respectively.

ii) Margin deposits representing margin paid for entering into contract for equity index /stock options which are released on final settlement/squaring up of the underlying contracts are disclosed under Loans and Advances.

iii) As at the Balance Sheet date in the case of long positions provision is made for the amount by which the premium paid for those options exceeds the premium prevailing on the balance sheet date, and in the case of short positions for the amount by which the premium prevailing on the balance sheet date exceeds the premium received for those options and is reflected in "Provision for loss on equity Index/Stock Options Account."

iv) When the option contracts are squared up before the expiry of the options the premium prevailing on that date is recognised in the Profit and Loss Account.

On the expiry of the contracts and on exercising the options the difference between the final settlement price and the strike price is transferred to the Profit and Loss Account.

In both the cases, the premium paid or received for buying or selling the option as the case may be is recognized in the profit and loss account for the squared-up/settled contracts.

h. Taxes on Income

Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. Minimum Alternate Tax (MAT) eligible for set off in subsequent years, (as per tax laws) is recognized as an asset by way of credit to the Profit and Loss Account only if there is convincing evidence of its realisation. At each balance sheet date, the carrying amount of MAT Credit Entitlement receivable is reviewed to reassure realisation.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognised mainly on account of unabsorbed depreciation and carry forward of losses to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

I. Inventories

Inventory consists of shares and securities purchased for trading purposes. These are valued at lower of cost or net realizable value. Cost is computed on FIFO basis. For the purpose of determining net realizable value, the last quoted closing prices at the Bombay Stock Exchange Limited (''BSE'') are considered.

j. Employee Benefits

Defined Contribution Plans such as Provident Fund etc. are charged to the Profit & Loss Account as incurred.

Defined Benefit Plans - The present value of the obligation under such plan was determined based on an actuarial valuation which was carried out by an independent actuary. The actuarial valuation method used by the independent actuary for measuring the liability was the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation was recognized immediately in the Profit & Loss Account. However during the year as there is only one employee, the company has worked out the gratuity liability without actuarial valuation. The liability for the same is provided in the accounts.

Other Long term Employee Benefits are recognized in the same manner as Defined Benefit Plans. Termination benefits are recognized as and when incurred.

k. Operating Lease

Lease payments for assets on operating lease are recognized as an expense in Profit & Loss Account in accordance with Accounting Standard 19 - Leases.

I. Provisions and Contingent Liabilities

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. Adisclosu re for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resource is remote, no provision or disclosure is made.

m. Impairment of Assets

The Company assesses at each Balance Sheet date whether there is any indication that asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the Profit and Loss Account.

n. The Company follows the Prudential Norms for Assets Classification, Income Recognition, Accounting Standards, Provision for non-performing assets as prescribed by the Reserve Bank of India under Non-Banking Financial (Non deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. During the year, these norms have been amended, mandating 0.25% provision against the outstanding standard assets.


Mar 31, 2012

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 of India (the 'Act') and the relevant provisions of the Act and the regulations of Reserve Bank of India to the extent applicable. The significant accounting policies are as follows:

a. Basis of preparation of Financial Statements

The financial statements are prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation/Amortisation

Fixed Assets are stated at Cost less Depreciation. The Company capitalises all cost relating to acquisition and installation of Fixed Assets.

Depreciation is provided on Straight Line Method, pro rata for the period of use, at the rates specified in Schedule XIV to the Act or based on rates as per useful life of asset, whichever is higher. Air conditioners and office equipment are depreciated over 7 years, which is different from rates specified from Schedule XIV.

Leasehold improvements are depreciated on straight line basis over the period of lease.

Assets costing Rs. 5,000 or less are fully depreciated in the year of acquisition.

c. Investments

Investments are classified as long term or current based on management intention at the time of purchase. Investments which are intended to be held for one year or more are classified as long term investments and investments which are intended to be held for less than one year are classified as current investments.

Long term investments are recorded at cost as on the date of transaction and any decline in the carrying value other than temporary in nature is provided for. Current investments are valued at cost or market/fair value, whichever is lower.

d. Revenue Recognition

i. Interest income is accounted on an accrual basis.

ii. Dividend income is recognised when the right to receive dividend is established.

iii. Realised gains and losses in respect of equity securities and units of mutual funds are calculated as the difference between the net sales proceeds and their cost. Cost in respect of equity shares and units of mutual funds is computed using the first in first out (FIFO) method.

e. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known/materialised.

f. Equity Index/Stock Futures.

i) Margin Deposits representing margin paid for entering into a contract for equity index/stock futures which are released on final settlement/squaring up of the underlying contract, are disclosed under Loans and advances.

ii) Equity index/stock futures are marked to market on a daily basis. Debit or credit balance disclosed under Loans and Advances or Current Liabilities respectively in the "Mark- to- Market Margin - Equity Index/Stock Futures account " represents the net amount paid or received on the basis of movement in the prices of index/stock futures till the Balance Sheet date.

iii) As on the Balance Sheet date profit/loss on open positions in equity index/stock futures in accounted for as follows:

- Credit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account" being the anticipated profit is ignored and no credit for the same is taken in the Profit and Loss Account.

- Debit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account", being the anticipated loss is adjusted in the Profit and Loss Account.

iv) On final settlement or squaring up of contracts for equity index/stock futures the

profit or loss is calculated as the difference between the settlement/squaring up price and the contract price. Accordingly debit or credit balance pertaining to the settled/squared up contract in "Mark-to- Market Margin - Equity Index/stock Futures Account", after adjustment of the provision for anticipated losses in recognised in the Profit and Loss Account.

g. Equity Index/Stock Options

i) "Equity Index/Stock option premium account" represents premium paid or received for buying or selling the options, respectively.

ii) Margin deposits representing margin paid for entering into contract for equity index/stock options which are released on final settlement/squaring up of the underlying contracts are disclosed under Loans and Advances.

iii) As at the Balance Sheet date in the case of long positions provision is made for the amount by which the premium paid for those options exceeds the premium prevailing on the balance sheet date, and in the case of short positions for the amount by which the premium prevailing on the balance sheet date exceeds the premium received for those options and is reflected in "Provision for loss on equity Index/Stock Options Account.

iv) When the option contracts are squared up before the expiry of the options the premium prevailing on that date is recognised in the Profit and Loss Account.

On the expiry of the contracts and on exercising the options the difference between the final settlement price and the strike price is transferred to the Profit and Loss Account.

In both the cases, the premium paid or received for buying or selling the option as the case may be is recognized in the profit and loss account for the squared- up/settled contracts.

h. Taxes on Income

Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. Minimum Alternate Tax (MAT) eligible for set off in subsequent years, (as per tax laws) is recognized as an asset by way of credit to the Profit and Loss Account only if there is convincing evidence of its realisation. At each balance sheet date, the carrying amount of MAT Credit Entitlement receivable is reviewed to reassure realisation.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognised mainly on account of unabsorbed depreciation and carry forward of losses to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

i. Inventories

Inventory consists of shares and securities purchased for trading purposes. These are valued at lower of cost or net realizable value. Cost is computed on FIFO basis. For the purpose of determining net realizable value, the last quoted closing prices at the BSE Limited ('BSE') is considered.

j. Employee Benefits

Defined Contribution Plans such as Provident Fund etc. are charged to the Profit & Loss Account as incurred.

Defined Benefit Plans - The present value of the obligation under such plan is determined based on an actuarial valuation which is carried out by an independent actuary. The actuarial valuation method used by the independent actuary for measuring the liability is the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the Profit & Loss Account.

Other Long term Employee Benefits are recognized in the same manner as Defined Benefit Plans. Termination benefits are recognized as and when incurred.

k. Operating Lease

Lease payments for assets on operating lease are recognized as an expenses in Profit & Loss Account in accordance with Accounting Standard 19 - Leases.

l. Provisions and Contingent Liabilities

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resource is remote, no provision or disclosure is made.

m. Impairment of Assets

The Company assesses at each Balance Sheet date whether there is any indication that asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the Profit and Loss Account.

n. The Company follows the Prudential Norms for Assets Classification, Income Recognition, Accounting Standards, Provision for non-performing assets as prescribed by the Reserve Bank of India under Non-Banking Financial (Non deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. During the year, these norms have been amended, mandating 0.25% provision against the outstanding standard assets.


Mar 31, 2011

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 of India (the ‘Act') and the relevant provisions of the Act and the regulations of Reserve Bank of India to the extent applicable. The significant accounting policies are as follows:

a. Basis of preparation of Financial Statements

The financial statements are prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation/ Amortisation

Fixed Assets are stated at Cost less Depreciation. The Company capitalises all cost relating to acquisition and installation of Fixed Assets.

Depreciation is provided on Straight Line Method, pro rata for the period of use, at the rates specified in Schedule XIV to the Act or based on rates as per useful life of asset, whichever is higher. Air conditioners and office equipment are depreciated over 7 years, which is different from rates specified from Schedule XIV.

Leasehold improvements are depreciated on straight line basis over the period of lease.

Assets costing Rs. 5,000 or less are fully depreciated in the year of acquisition.

c. Investments

Investments are classified as long term or current based on management intention at the time of purchase. Investments which are intended to be held for one year or more are classified as long term investments and investments which are intended to be held for less than one year are classified as current investments.

Long term investments are recorded at cost as on the date of transaction and any decline in the carrying value other than temporary in nature is provided for. Current investments are valued at cost or market/fair value, whichever is lower.

d. Revenue Recognition

i. Interest income is accounted on an accrual basis.

ii. Dividend income is recognised when the right to receive dividend is established.

iii. Realised gains and losses in respect of equity securities and units of mutual funds are calculated as the difference between the net sales proceeds and their cost. Cost in respect of equity shares and units of mutual funds is computed using the first in first out (FIFO) method.

e. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known /materialised.

f. Equity Index / Stock Futures.

i) Margin Deposits representing margin paid for entering into a contract for equity index/stock futures which are released on final settlement/squaring up of the underlying contract, are disclosed under Loans and advances.

ii) Equity index/stock futures are marked to market on a daily basis. Debit or credit balance disclosed under Loans and Advances or Current Liabilities respectively in the "Mark- to- Market Margin - Equity Index/Stock Futures account " represents the net amount paid or received on the basis of movement in the prices of index/stock futures till the Balance Sheet date.

iii) As on the Balance Sheet date profit/loss on open positions in equity index/stock futures in accounted for as follows:

- Credit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account" being the anticipated profit is ignored and no credit for the same is taken in the Profit and Loss Account.

- Debit balance in the "Mark-to-Market Margin–Equity Index/Stock Futures Account", being the anticipated loss is adjusted in the Profit and Loss Account.

iv) On final settlement or squaring up of contracts for equity index/stock futures the profit or loss is calculated as the difference between the settlement/squaring up price and the contract price. Accordingly debit or credit balance pertaining to the settled/squared up contract in "Mark-to- Market Margin – Equity Index/stock Futures Account", after adjustment of the provision for anticipated losses in recognised in the Profit and Loss Account.

g. Equity Index / Stock Options

i) "Equity Index/Stock option premium account" represents premium paid or received for buying or selling the options, respectively.

ii) Margin deposits representing margin paid for entering into contract for equity index /stock options which are released on final settlement/squaring up of the underlying contracts are disclosed under Loans and Advances.

iii) As at the Balance Sheet date in the case of long positions provision is made for the amount by which the premium paid for those options exceeds the premium prevailing on the balance sheet date, and in the case of short positions for the amount by which the premium prevailing on the balance sheet date exceeds the premium received for those options and is reflected in "Provision for loss on equity Index/Stock Options Account."

iv) When the option contracts are squared up before the expiry of the options the premium prevailing on that date is recognised in the Profit and Loss Account.

On the expiry of the contracts and on exercising the options the difference between the final settlement price and the strike price is transferred to the Profit and Loss Account.

In both the cases, the premium paid or received for buying or selling the option as the case may be is recognized in the profit and loss account for the squared–up/settled contracts.

h. Taxes on Income

Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. Minimum Alternate Tax (MAT) eligible for set off in subsequent years, (as per tax laws) is recognized as an asset by way of credit to the Profit and Loss Account only if there is convincing evidence of its realisation. At each balance sheet date, the carrying amount of MAT Credit Entitlement receivable is reviewed to reassure realisation.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognised mainly on account of unabsorbed depreciation and carry forward of losses to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

i. Stock-in-Trade

Stock-in-Trade consists of shares and securities purchased for trading purposes. These are valued at lower of cost and net realizable value. Cost is computed on FIFO basis. For the purpose of determining net realizable value, the last quoted closing prices at the Bombay Stock Exchange Limited (‘BSE') is considered.

j. Employee Benefits

Defined Contribution Plans such as Provident Fund etc. are charged to the Profit & Loss Accounts as incurred.

Defined Benefit Plans - The present value of the obligation under such plan is determined based on an actuarial valuation which is carried out by an independent actuary. The actuarial valuation method used by the independent actuary for measuring the liability is the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the Profit & Loss Account.

Other Long term Employee Benefits are recognized in the same manner as Defined Benefit Plans. Termination benefits are recognized as and when incurred.

k. Operating Lease

Lease payments for assets on operating lease are recognized as an expenses in Profit & Loss Account in accordance with Accounting Standard 19 – Leases.

l. Provisions and Contingent Liabilities

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resource is remote, no provision or disclosure is made.

m. Impairment of Assets

The Company assesses at each Balance Sheet date whether there is any indication that asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the Profit and Loss Account.

n. The Company follows the Prudential Norms for Assets Classification, Income Recognition, Accounting Standards, Provision for non-performing assets as prescribed by the Reserve Bank of India under Non-Banking Financial (Non deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. During the year, these norms have been amended, mandating 0.25% provision against the outstanding standard assets.


Mar 31, 2010

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 of India (the Act) and the relevant provisions of the Act. The significant accounting policies are as follows:

a. Basis of preparation of Financial Statements

The financial statements are prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation/ Amortisation

Fixed Assets are stated at Cost less Depreciation. The Company capitalises all cost relating to acquisition and installation of Fixed Assets.

Depreciation is provided on Straight Line Method pro rata for the period of use, at the rates specified in Schedule XIV to the Act.

Assets costing Rs. 5,000 or less are fully depreciated in the year of acquisition.

c. Investments

Investments are classified as long term or current based on management intention at the time of purchase. Investments which are intended to be held for one year or more are classified as long term investments and investments which are intended to be held for less than one year are classified as current investments.

Long term investments are recorded at cost as on the date of transaction and any decline in the carrying value other than temporary in nature is provided for. Current investments are valued at cost or market/fair value,.whichever is lower.

d. Revenue Recognition

i. Interest income is accounted on an accrual basis.

ii. Dividend income is recognised when the right to receive dividend is established.

iii. Realised gains and losses in respect of equity securities and units of mutual funds are calculated as the difference between the net sales proceeds and their cost. Cost in respect of equity shares and units of mutual funds is computed using the first in first out (FIFO) method.

e. Equity Index / Stock Futures.

i) Margin Deposits representing margin paid for entering into a contract for equityindex/stock futures which are released on final settlement/squaring up of the underlying contract, are disclosed under Loans and advances.

Schedule forming part of the Balance Sheet as at March 31, 2010 and the Profit and Loss Account for the year ended March 31, 2010

ii) Equity index/stock futures are marked to market on a daily basis. Debit or credit balance disclosed under Loans and Advances or Current Liabilities respectively in the "Mark- to- Market Margin - Equity Index/Stock Futures account " represents the net amount paid or received on the basis of movement in the prices of index/stock futures till the Balance Sheet date.

iii) As on the Balance Sheet date profit/loss on open positions in equity index/stock futures in accounted for as follows:

- Credit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account" being the anticipated profit is ignored and no credit for the same is taken in the Profit and Loss Account.

- Debit balance in the "Mark-to-Market Margin-Equity Index/Stock Futures Account", being the anticipated loss is adjusted in the Profit and Loss Account.

iv) On final settlement or squaring up of contracts for equity index/stock futures the profit or loss is calculated as the difference between the settlement/squaring up price and the contract price. Accordingly debit or credit balance pertaining to the settled/squared up contract in "Mark-to- Market Margin - Equity Index/stock Futures Account", after adjustment of the provision for anticipated losses in recognised in the Profit and Loss Account.

f. Equity Index / Stock Options

i) Margin deposits representing margin paid for entering into contract for equity index /stock options which are released on final settlement/ squaring up of the underlying contracts are disclosed under Loans and Advances.

ii) Equity Index/Stock Option Premium Account represents the premium paid or received for buying or selling the options respectively.

iii) As at the Balance Sheet date in the case of long positions provision is made for those options exceeds the premium prevailing on the balance sheet date, and in the case of short positions for the amount by which the premium prevailing on the balance sheet date exceeds the premium received for those options and is reflected in "Provision for loss on equity Index/Stock Options Account."

iv) When the option contracts are squared up before the expiry of the options the premium prevailing on that date is recognised in the Profit and Loss Account.

On the expiry of the contracts and on exercising the options the difference between the final settlement price and the strike price is transferred to the Profit and Loss Account.

In both the cases, the premium paid or received for buying or selling the option as the case may be is recognized in the profit and loss account for the squared-up/settled contracts.

g. Taxes on Income

Provision for tax for the year is made on the assessable income at the tax rate applicable to the relevant year.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognised for unabsorbed depreciation and carry forward of losses to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

h. Stoek-in-Trade

Stock-in-Trade consists of shares and securities purchased for trading purposes. These are valued at lower of cost and market price. For the purpose of determining market value, the last quoted closing prices at the Stock Exchange, Mumbai CBSET is considered.

The Company assesses at each Balance Sheet date whether there is any indication that asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment Ioss and is recognised in the Profit and Loss Account.

i. The Company follows the Prudential Norms for Assets Classification, Income Recognition, Accounting Standards, Provision for non-performing assets as prescribed by the Reserve Bank of India under Non-Banking Financial (Non deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

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