Accounting Policies of Dolphin Hotels Ltd. Company

Mar 31, 2011

A. The financial statements have been prepared to comply in all material respects with the Notified accounting standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared in accordance with the generally accepted Accounting Principles in India under the historical cost convention on accrual basis, except in case of assets for which provision for impairment is made and revaluation is carried out. The accounting policies are consistent with those used in the previous year.

b. The preparation of financial statements requires the management of the company to make certain estimates and assumptions that effect the reported balances of assets and liabilities and disclosures relating to the contingent liabilities as at the date of the financial statements and the reported amounts of income and expenditure during the year. Any revision to such estimates is recognised prospectively in the year in which it is revised.

c. Fixed Assets are stated at cost net of accumulated depreciation and impairment losses if any. Cost comprises the purchase price and all attributable costs to bring the asset to its working condition for its intended use.

d. Depreciation on the assets is provided on straight line method on all assets, except construction machinery, vehicles, office furniture and office equipment for which written down value method is followed in accordance with Schedule XIV to the Companies Act, 1956.

Fixed Assets costing rupees Five thousand or less are fully depreciated in the year of acquisition.

Buildings constructed on lease hold land are depreciated over the Primary lease period.

Intangible assets are written off over their estimated useful life.

e. Current Investments are carried at lower of cost and market value.

f. Stock of Provisions, Stores, Wines, Crockery, Cutlery, Carpets and Linen are valued at direct cost based on Weighted Average Method.

g. Crockery, Cutlery, Carpets and Linen issued to user departments is taken as consumption. However, the base stock is capitalised.

h. Sales made in foreign currency are recognised at the prevailing applicable exchange rate. Gain/Loss arising out of fluctuation in the exchange rate is accounted for on realisation.

i. Borrowing costs that are directly attributable to the acquisition, construction or production of fixed assets are capitalised as part of the cost of that assets.

j. All contingent liabilities are indicated by way of a note and will be provided/paid on crystalisation.

k. Employee Benefits are accounted for as follows as per the Accounting Standard 15.

i) Short term employee benefits such as wages, salaries, incentives, bonus and short term earned leaves are fully provided.

ii) All other long term employee benefits such as earned leave are provided as per actuarial valuation.

iii) Contributions to provident fund are remitted to Provident Fund Commissioner.

iv) Post employees benefits such as Gratuity is treated as defined benefit plan and accounted as per actuarial valuation.

l. All capital grants / investment subsidies received from Governments are directly credited to Capital Reserve.

m. All items of income/expenditure pertaining to prior period, which are material, are accounted through "prior period adjustments” and the others are shown under respective heads of account in the Profit and Loss Account.

n. Deferred tax asset and liability is calculated by applying the tax rate and tax laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets are recognised and carried forward only to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax asset can be realised.

o. Impairment loss is recognised whenever the carrying amount of an asset is in excess of its recoverable amount and the same is recognised as an expense in the statement of Profit and Loss and the carrying amount of the asset is reduced to its recoverable amount.

Reversal of impairment losses recognised in prior years is recorded when there is an indication that the impairment losses recognised for the asset are no longer exist or have decreased.

p. All the lease agreements entered into by the company both as lessee and lessor are only operating leases. The payments made or the amounts received under such operating leases are debited or credited as the case may be to profit and loss account on straight-line basis over the lease period.

q. A provision is recognised when there is a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

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Mar 31, 2010

A. The financial statements have been prepared to comply in all material respects with the Notified accounting standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared in accordance with the generally accepted Accounting Principles in India under the historical cost convention on accrual basis, except in case of assets for which provision for impairment is made and revaluation is carried out. The accounting policies are consistent with those used in the previous year.

b. The preparation of financial statements requires the management of the company to make certain estimates and assumptions that effect the reported balances of assets and liabilities and disclosures relating to the contingent liabilities as at the date of the financial statements and the reported amounts of income and expenditure during the year. Any revision to such estimates is recognised prospectively in the year in which it is revised.

c. Fixed Assets are stated at cost net of accumulated depreciation and impairment losses if any. Cost comprises the purchase price and all attributable costs to bring the asset to its working condition for its intended use.

d. Depreciation on the assets is provided on straight line method on all assets, except construction machinery, vehicles, office furniture and office equipment for which written down value method is followed in accordance with Schedule XIV to the Companies Act, 1956.

Fixed Assets costing rupees Five thousand or less are fully depreciated in the year of acquisition.

Buildings constructed on lease hold land are depreciated over the Primary lease period.

Intangible assets are written off over their estimated useful life.

e. Current Investments are carried at lower of cost and market value.

f. Stock of Provisions, Stores, Wines, Crockery, Cutlery, Carpets and Linen are valued at direct cost based on Weighted Average Method.

g. Crockery, Cutlery, Carpets and Linen issued to user departments is taken as consumption. However, the base stock is capitalised.

h. Sales made in foreign currency are recognised at the prevailing applicable exchange rate. Gain/Loss arising out of fluctuation in the exchange rate is accounted for on realisation.

i. Borrowing costs that are directly attributable to the acquisition, construction or production of fixed assets are capitalised as part of the cost of that assets.

j. All contingent liabilities are indicated by way of a note and will be provided/paid on crystalisation.

k. Employee Benefits are accounted for as follows as per the Accounting Standard 15.

i) Short term employee benefits such as wages, salaries, incentives, bonus and short term earned leaves are fully provided.

ii) All other long term employee benefits such as earned leave are provided as per actuarial valuation.

iii) Contributions to provident fund are remitted to Provident Fund Commissioner.

iv) Post employees benefits such as Gratuity is treated as defined benefit plan and accounted as per actuarial valuation.

l. All capital grants / investment subsidies received from Governments are directly credited to Capital Reserve.

m. All items of income/expenditure pertaining to prior period, which are material, are accounted through "prior period adjustments” and the others are shown under respective heads of account in the Profit and Loss Account.

n. Deferred tax asset and liability is calculated by applying the tax rate and tax laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets are recognised and carried forward only to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax asset can be realised.

o. Impairment loss is recognised whenever the carrying amount of an asset is in excess of its recoverable amount and the same is recognised as an expense in the statement of Profit and Loss and the carrying amount of the asset is reduced to its recoverable amount.

Reversal of impairment losses recognised in prior years is recorded when there is an indication that the impairment losses recognised for the asset are no longer exist or have decreased.

p. All the lease agreements entered into by the company both as lessee and lesser are only operating leases. The payments made or the amounts received under such operating leases are debited or credited as the case may be to profit and loss account on straight-line basis over the lease period.

q. A provision is recognised when there is a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.