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SCHEDULE XV
National Housing Bank (NHB) is the Supervisory body for housing finance companies in India
under the jurisdiction of Ministry of Finance, Government of India. It was set up on 9 July 1988
under the National Housing Bank Act, 1987 to promote a sound, healthy, viable and cost effective
housing finance system to cater to all segments of the population and to integrate the housing
finance system with the overall financial system.
(A) Significant Accounting Policies
1. Basis of Preparation
The financial statements are prepared under the historical cost convention, on the accrual
basis of accounting, unless otherwise stated and are in accordance with the Generally
Accepted Accounting Principles (GAAP) in India, which encompasses applicable
statutory provisions, Accountant Standards (AS) issued by the Institute of Chartered
Accountants of India (ICAI) and regulatory norms prescribed by the Reserve Bank of
India (RBI).
Balance Sheet and Profit and Loss Account are drawn in accordance with the
requirements of the National Housing Bank Act, 1987 and National Housing Bank
General Regulations, 1988 framed there under.
2. Use of Estimates
The preparation of financial statements requires that management to make estimates
and assumptions that affect the reported amounts of assets, liabilities and the disclosure
of contingent liabilities on the date of the financial statements and the reported amount
of revenue & expenses during the reporting period. Management believes that the
estimates used in the preparation of financial statements are prudent and reasonable.
Actual result could differ from those estimates. Any revision to the accounting estimates
is recognized in accordance with the requirements of the respective accounting
standards.
3. Income and Expenditure
3.1. Income and expenditure are accounted on accrual basis except the following,
which are accounted on cash basis:
3.1.1. Income by way of penal interest, over and above the normal rate of interest,
charged due to delay receipt of loan dues or non-compliance with the terms of
loan.
Annual Report 2020-21 | 283
National Housing Bank (NHB) is the Supervisory body for housing finance companies in India
under the jurisdiction of Ministry of Finance, Government of India. It was set up on 9 July 1988
under the National Housing Bank Act, 1987 to promote a sound, healthy, viable and cost effective
housing finance system to cater to all segments of the population and to integrate the housing
finance system with the overall financial system.
(A) Significant Accounting Policies
1. Basis of Preparation
The financial statements are prepared under the historical cost convention, on the accrual
basis of accounting, unless otherwise stated and are in accordance with the Generally
Accepted Accounting Principles (GAAP) in India, which encompasses applicable
statutory provisions, Accountant Standards (AS) issued by the Institute of Chartered
Accountants of India (ICAI) and regulatory norms prescribed by the Reserve Bank of
India (RBI).
Balance Sheet and Profit and Loss Account are drawn in accordance with the
requirements of the National Housing Bank Act, 1987 and National Housing Bank
General Regulations, 1988 framed there under.
2. Use of Estimates
The preparation of financial statements requires that management to make estimates
and assumptions that affect the reported amounts of assets, liabilities and the disclosure
of contingent liabilities on the date of the financial statements and the reported amount
of revenue & expenses during the reporting period. Management believes that the
estimates used in the preparation of financial statements are prudent and reasonable.
Actual result could differ from those estimates. Any revision to the accounting estimates
is recognized in accordance with the requirements of the respective accounting
standards.
3. Income and Expenditure
3.1. Income and expenditure are accounted on accrual basis except the following,
which are accounted on cash basis:
3.1.1. Income by way of penal interest, over and above the normal rate of interest,
charged due to delay receipt of loan dues or non-compliance with the terms of
loan.
Annual Report 2020-21 | 283
