COSTS INCURRED ON UNCOMPLETED CONTRACTS

12 Months Ended

Mar. 31, 2012

COSTS INCURRED ON UNCOMPLETED CONTRACTS

COSTS INCURRED ON UNCOMPLETED CONTRACTS

NOTE 4 - COSTS INCURRED ON UNCOMPLETED CONTRACTS

The following table sets forth information as to costs incurred on uncompleted contracts as of March 31:

	2012			2011
Cost incurred on uncompleted contracts, beginning balance	$	7,958,153		$	5,149,663
Total cost incurred on contracts during the year	31,104,174			25,176,810
Less cost of sales, during the year	(28,182,584		)	(22,368,320		)
Cost incurred on uncompleted contracts, ending balance	$	10,879,743		$	7,958,153
Billings on uncompleted contracts, beginning balance	$	5,104,301		$	2,399,815
Plus: Total billings incurred on contracts, during the year	35,132,194			34,988,721
Less: Contracts recognized as revenue, during the year	(33,266,778		)	(32,284,235		)
Billings on uncompleted contracts, ending balance	$	6,969,717		$	5,104,301
Cost incurred on uncompleted contracts, ending balance	$	10,879,743		$	7,958,153
Billings on uncompleted contracts, ending balance	(6,969,717		)	(5,104,301		)
Costs incurred on uncompleted contracts, in excess of progress billings	$	3,910,026		$	2,853,852

Contract costs consist primarily of labor and materials and related overhead, to the extent that such costs are recoverable. Revenues associated with these contracts are recorded only when the amount of recovery can be estimated reliably and realization is probable. As of March 31, 2012 and 2011, the Company had deferred revenues totaling $799,413 and $382,130, respectively. Deferred revenues represent customer prepayments on their contracts and completed contracts on which all revenue recognition criteria were not met.   The Company records provisions for losses within costs of sales in its consolidated statement of operations and comprehensive (loss) income. The Company also receives advance billings and deposits representing down payments for acquisition of materials and progress payments on contracts. The agreements with our customers allow the Company to offset the progress payments against the costs incurred.