Accrual accounting exception for government financing companies permits undisclosed accrued interest if disclosed by note in annual accounts. Notification GSR 550(E) excludes application of clause (b) of sub section (3) of section 209 of the Companies Act, 1956 to Government companies financing industrial projects approved under the Income tax Act, limited to accrued interest on loans and advances not accounted for; such unaccounted accrued interest must be disclosed by way of a note in the annual accounts.