GAUSAL PROPERTIES LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR

ENDED 31ST DECEMBER 2014

NOTE 1: PRINCIPLE ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of this
financial statement set out below.

1.1 Basis of Accounting

These financial statements have been prepared in

accordance with international Financial Reporting standard
(IFRS) The financial statement are prepared under the
historical conventions.

1.2 Revenue Recognition

Revenue from sale of Good is recognized in the income

statement if the significant risk and risk and reward of
ownership have been transferred to the buyer and the
extent that it is probable that that the future economic
benefits will flow to the corporate and the amount for
revenue can be reliably measured.

1.3 Translation of foreign currency (cies)

Transactions of foreign currency during the year are
translated into Tanzania shilling at the exchange rate ruling
on the date of the transactions. Foreign currency monetary
assets and liabilities at the balance sheet date are
translated into M Tanzania shillings at the exchange rate
ruling at that rate. Resulting exchange rates differences
are recognized in the profit and loss account for the year.

1.4 Motor Vehicle, furniture and Office Equipments, Loose Tools

1.5 Depreciation

Depreciation is calculated to write off the cost of fixed

assets on straight line basis over their expected useful
lives. The annual rates of depreciation which are consistent
to those of previous year are as follow:

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 Description Rate

Land and Building 4%

Motor Vehicles 25%
Machines & Tools 12.5%
Furniture and Fittings 12.5%
Computer Equipment 37.5%

1.6 Inventories

Inventories are carried at lower of cost and net realizable

value. Cost is determined using the weighted average cost
method. Net realizable value is the estimate-selling price
in the open market less applicable selling expenses.

1.7 Financial Instruments

Financial asset and financial liabilities are recognized on

the company’s balance sheet when it has been a part to the
contractual previous of the instrument

The accounting policies in respect of the main financial

instruments are set out below.
i. Trade Debtor and other Receivables
Trade Debtor and other receivables are recognized initially
at fair value and subsequently measured at amortized cost
using the effective cost method less provision for
impairment. A provision for impairment of trade debtor
and other receivables is established when there is an
objective evidence that GAUSAL PROPERTIES
LIMITED will not able to collect all amounts due
according to the original term of receivables. The amount
of the previous is the different between carrying amount
and present value of estimate future cash flow, discount at
the effective interest rate. The amount of provision is
recognized in the income statement.

ii. Fair values

Except where stated elsewhere, the carrying amount of the
financial instruments approximate their fair value because
they carry market rate of interest.

iii. Trade Payables

Trade payable are stated at their normal value

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 1.8 Impairment

At each balance sheet date the company reviews the

carrying amount of its tangible and intangible assets to
determine whether there is any significant indication that
those asset have suffer have suffered an impairment in
order to determine the extent of the impairment losses (if
any). An impairment loss is recognized for the amount by
which the carrying amounts of the asset exceed its
removable amount at which is the higher of the asset’s net
selling price and value in use.

1.9 Functional and Presentation of Currency

For the purpose of cash flow statement, cash flow and cash
equivalent comprise cash in hand and bank balance held at
the bank accounts at the reporting date

1.10 Taxation

Tax on the profit for the year comprises current and

differed tax. Current is provided as result of the year
operations as shown in the income statement adjusted with
tax legislation.

Differed tax (if any) is provided using balance sheet liability

method on temporary different between the carrying
amount for the financial reporting purpose and the mount
used for taxation purposes.

Differed tax is calculated on the basis of the tax rate

currently enacted.

2. SHARE CAPITAL OF THE COMPANY

All shares are Ordinary Share Class and partly issued. Advance
toward share capital represent contribution by shareholder
toward pre project Expenses.

3. PRE PROJECTED EXPENSES