Lok Housing to restate accounts, other real estate players could follow the suit

20 Feb 2009 Evaluate

In a first of its kind development, Mumbai-based Lok Housing and Construction is planning to restate its accounts for the past three financial years as the revenue it booked hasn’t materialised after investors and buyers backed out of its projects.

 

The plight of this company may befall on other real estate players as many more companies could follow suit by restating accounts. Lok will write off Rs 225.01 crore worth of profit and Rs 282.14 crore of sales it recognised in its books in the previous financial years, according to the notes on the accounts. The profit to be written off will be marginally lower than that declared by the company.

 

Due to the financial meltdown and severe economic recession, some of the parties with whom the company had entered into agreement to sell have failed to meet their commitments and considering the overall interest of the company, the agreement for sale entered into in the past financial years and in respect of which revenues already recognised have been mutually terminated/ cancelled, the company said in a statement to the exchanges recently.

 

Lok Housing had reported a profit of Rs 112.85 crore in FY08, Rs 91.67 crore in FY07 and Rs 21.86 crore in FY06. The company reported losses prior to these periods. The company would seek shareholder’s approval in May for the restatement of accounts, a company official said. It has already got the court's approval for the same. The company is expected to write off the amounts in one or two quarters.

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Company Name CMP
Dilip Buildcon 456.85
Macrotech Developers 1133.75
NBCC (India) 119.05
Prestige EstatesProj 1177.50
DLF 898.30
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