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Accounting Policies of Agarwal Industrial Corporation Ltd. Company

Mar 31, 2015

I. Use of Estimates

The preparation of the financial statements in conformity with the Indian GAAP requires management to make judgement, estimates and assumptions that affects the reported amount of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring material adjustment to the carrying amounts of assets or liabilities in future periods.

ii. Revenue Recognition

The Company follows Mercantile system of Accounting and Income and expenditure are recognised on accrual basis.

iii. Fixed Assets

All fixed Assets are stated at cost of acquisition less accumulated depreciation (net of cenvat, wherever availed). All cost relating to the acquisition and installation of the fixed assets are capitalised and includes financing costs relating to borrowed fund attributable to the acquisition of fixed assets up to the date the fixed assets is put to use.

iv. Depreciation

Depreciation has been provided on straight-line basis and in accordance with, Method and useful life prescribed in Schedule II to the Companies Act 2013.

v. Impairment

An asset is treated as impaired when the carrying cost of the Asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the statement of Profit & Loss in the year in which as asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been an improvement in recoverable amount.

vi. Inventories Valuation

Raw material and Packing Material: At lower of Cost or Net realisable value. The cost is arrived at on first-in-first-out basis and net of cenvat credit availed.

Finished Goods and Semi Finished Goods: At lower of Cost or Net realisable value. Cost includes appropriate allocation of overheads and is arrived at on first-in-first-out basis.

vii. Investments

Long term investments are stated at cost less provision for diminution in value other than temporary, if any. Current investments are stated at lower of cost and fair value.

viii. Borrowing Cost

Borrowing Costs that are attributable to the acquisition and construction of qualifying assets are capitalised. A qualifying asset is an asset that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are recognised as an expense in the year in which they are incurred.

ix. Foreign Currency Transaction

Foreign currency transactions are accounted on the basis of exchange rate prevailing at the time of transaction. The foreign currency transaction remains outstanding at year-end are restated at rate prevailing as on 31st March. The Exchange difference if any arises due to exchange fluctuation is charged to Statement of Profit and Loss.

x. Taxes on Income

Current Tax is measured at the amount expected to be paid to the taxation authorities, using the applicable tax rates and tax laws.

Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been announced upto the balance sheet date. Deferred Tax assets and liabilities are recognised for the future tax consequences attributable to timing differences between the taxable income and accounting income. The effect of tax rate change is considered in the Profit & Loss account of the respective year of change.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the asset is created by way of a credit to the Statement of Profit & Loss and shown as MAT Credit Entitlement. The company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during specified period.

xi. Retirement Benefits

Short Term and Long Term Employee Benefits are recognised as an expense in the Statement of Profit and Loss for the year in which the employee has rendered services.

xii. Earning Per Share

Basic earning per share are calculated by dividing the net profit /(loss) for the year attributable to equity shareholders (after deducting attributable taxes) by average number of equity shares outstanding during the year.

For the purpose of calculating diluted earning per share, the net profit or loss for the year attributable to equity shareholders and the average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

xiii. Segmental Reporting

The Company is engaged in the business segment namely transportation, service centre, power generation by windmill and manufacturing of Bitumen & Bituminous Products. Segment assets include all operating assets used by a segment and consist primarily of debtors, current assets and fixed assets net of provisions and allowance. Segment liabilities include all operating liabilities and consist principally of creditors and other payables.

xiv. Provisions, Contingent Liabilities And Contingent Assets

Provisions are recognized in the accounts in respect of present probable obligations arising as a result of past events and it is probable that there will be an outflow of resources, the amount of which can be reliably estimated

Contingent liabilities are disclosed in respect of possible obligation that arises from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly with in the control of the company.

Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2014

I. Use of Estimates

The preparation of the financial statements in conformity with the Indian GAAP requires management to make judgement, estimates and assumptions that affects the reported amount of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring material adjustment to the carrying amounts of assets or liabilities in future periods.

ii. Revenue Recognition

The Company follows Mercantile system of Accounting and Income and expenditure are recognised on accrual basis.

iii. Fixed Assets

All fixed Assets are stated at cost of acquisition less accumulated depreciation (net of cenvat, wherever availed). All cost relating to the acquisition and installation of the fixed assets are capitalised and includes financing costs relating to borrowed fund attributable to the acquisition of fixed assets up to the date the fixed assets is put to use.

iv. Depreciation

Depreciation has been provided on straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

v. Impairment

An asset is treated as impaired when the carrying cost of the Asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the statement of Profit & Loss in the year in which as asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been an improvement in recoverable amount.

vi. Inventories Valuation

Raw material and Packing Material: At lower of Cost or Net realisable value. The cost is arrived at on first-in-first-out basis and net of cenvat credit availed.

Finished Goods and Semi Finished Goods: At lower of Cost or Net realisable value. Cost includes appropriate allocation of overheads and is arrived at on first-in-first-out basis.

vii. Investments

Long term investments are stated at cost less provision for diminution in value other than temporary, if any. Current investments are stated at lower of cost and fair value.

viii. Borrowing Cost

Borrowing Costs that are attributable to the acquisition and construction of qualifying assets are capitalised. A qualifying asset is an asset that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are recognised as an expense in the year in which they are incurred.

ix. Foreign Currency Transaction

Foreign currency transactions are accounted on the basis of exchange rate prevailing at the time of transaction. The foreign currency transaction remains outstanding at year-end are restated at rate prevailing as on 31st March. The Exchange difference if any arises due to exchange fluctuation is charged to Statement of Profit and Loss.

x. Taxes on Income

Current Tax is measured at the amount expected to be paid to the taxation authorities, using the applicable tax rates and tax laws.

Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been announced upto the balance sheet date. Deferred Tax assets and liabilities are recognised for the future tax consequences attributable to timing differences between the taxable income and accounting income. The effect of tax rate change is considered in the Profit & Loss account of the respective year of change.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the asset is created by way of a credit to the Statement of Profit & Loss and shown as MAT Credit Entitlement. The company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during specified period.

xi. Retirement Benefits

Short Term and Long Term Employee Benefits are recognised as an expense in the Statement of Profit and Loss for the year in which the employee has rendered services.

xii. Earning Per Share

Basic earning per share are calculated by dividing the net profit /(loss) for the year attributable to equity shareholders (after deducting attributable taxes) by average number of equity shares outstanding during the year.

For the purpose of calculating diluted earning per share, the net profit or loss for the year attributable to equity shareholders and the average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

xiii. Segmental Reporting

The Company is engaged in the business segment namely transportation, service centre, power generation by windmill and manufacturing of Bitumen & Bituminous Products. Segment assets include all operating assets used by a segment and consist primarily of debtors, current assets and fixed assets net of provisions and allowance. Segment liabilities include all operating liabilities and consist principally of creditors and other payables.

xiv. Provisions, Contingent Liabilities And Contingent Assets

Provisions are recognized in the accounts in respect of present probable obligations arising as a result of past events and it is probable that there will be an outflow of resources, the amount of which can be reliably estimated

Contingent liabilities are disclosed in respect of possible obligation that arises from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly with in the control of the company.

Contingent Assets are neither recognized nor disclosed in the financial statements.

(ii) Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of '' 10 per share. Each holder of Equity Shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaning assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(iii) Detail of shares held by the holding company, the ultimate holding Nil Nil

company, their subsidiaries and associates :

Based on the information available with the company, obtained on verble confirmation, there are no dues to micro, small and medium enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 as on 31st March 2014


Mar 31, 2013

A) Change in Accounting Policy

During the year ended March 31, 2013, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the Company, for preparation & presentation of its financial statements. The Adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of Financial statements. However, it has significant impact on presentation and disclosure made in the Financial Statements. The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

b) Use of Estimate

The Preparation of financial statements, in conformity with Indian GAAP requires management to make Judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets, liabilities & disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustments to the carrying amounts of assets or liabilities in future periods.

c) Tangible Fixed Assets

Fixed assets are stated at cost, less accumulated depreciation, amortization & impairment losses if any. Cost comprises the purchase price and any directly attributable cost of bringing the assets to its working condition for its intended use.

d) Depreciation & Amortization

Depreciation on Tangible Fixed Assets are provided using straight line method based on estimated useful life or on the basis of depreciation rates prescribed under Schedule XIV of the Companies Act, 1956 whichever is higher.

e) Impairment

An asset is treated as impaired when the carrying cost of the Asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognized as an expenses in the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been an improvement in recoverable amount.

f) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the respective asset. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and amortization of ancillary costs incurred in connection with the arrangement of borrowings.

g) Investments

(i) Long term investments are carried at cost after deducting provision, if any, for diminution in value considered to be other than temporary in nature.

(ii) Current Investments are stated at lower of cost and fair value.

h) Inventories

Inventories are valued at cost or net realizable value, whichever is lower.

i) Foreign Currency

Transactions in foreign currencies are recorded at the exchange rates notified by CBEC or at the exchange rate under related forward exchange contracts. The realized exchange gains/ losses are recognized in the Profit & Loss account. All foreign currency current assets and liabilities are translated in rupees at the rates prevailing on the date of balance sheet.

j) Employee benefits

Short Term Employee Benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered. Post employment benefits are recognized as an expense in the Profit and loss account for the year in which the employee has rendered services. Long Term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services.

k) Revenue Recognition

Sale of goods :

Sales are recognized when the substantial risks and rewards of ownership in the goods are transferred to the buyer as per the terms of the contract and are recognized net of trade discounts, rebates, sales taxes and excise duties.

Interest :

Interest Income is recognized on time proportion basis taking into account the amount outstanding and the rate applicable.

l) Taxation

Provision for current income tax is made in accordance with Local laws. Deferred Tax liabilities and assets are recognized at substantively enacted tax rates, subject to the consideration of prudence, on timing difference.

m) Revenue :

Domestic Sales is Exclusive of Excise duty & Vat.

n) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities & Contingent Assets are neither recognized nor disclosed in the financial statements.

o) Segment Reporting

The Company''s operations relate to the business segments namely transportation, service centre, Power Generation by Windmill and Manufacturing of Bitumen & Bituminous Products. These business segments represents primary basis of information set out in the financial statements. In accordance with the Accounting Standard 17 on Segment Reporting issued by the ICAI, the segment information for the year ended March 31,2013 is as follows:

Segment assets include all operating assets used by a segment and consist primarily of debtors, ,current assets and fixed assets net of provisions and allowances Segment liabilities include all operating liabilities and consist principally of creditors and other payables.


Mar 31, 2012

A) Change in Accounting Policy

During the year ended March 31, 2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the Company, for preparation & presentation of its financial statements. The Adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of Financial statements. However, it has significant impact on presentation and disclosure made in the Financial Statements. The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

b) Use of Estimate

The Preparation of financial statements, in conformity with indian GAAP requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets, liabilities & disclosure of contigent liabilities at the end of the reporting period. Although thses estimates are based upon management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustments to the carrying amounts of assets or liabilities in future periods.

c) Tangible Fixed Assets

Fixed assets are stated at cost, less accumated depriciation, amortisation & impairment losses if any. Cost comprises the purchase price and any directly attributable cost of bringing the aseets to its working condition for its intended use.

d) Depreciation &Amortization

Depriciation on Tangible Fixed Assets are provided using straight line method based on estimated useful life or on the basis of depriciation rates prescribed under Schedule XIV of the Companies Act, 1956 whichever is higher.

e) Impairment

An asset is treated as impaired when the carrying cost of the Asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognized as an expenses in the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been an improvement in recoverable amount.

f) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the respective asset. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and amortisation of ancillary costs incurred in connection with the arrangement of borrowings.

g) Investments

(i) Long term investments are carried at cost after deducting provision, if any, for diminution in value considered to be other than temporary in nature.

(ii) Current Investments are stated at lower of cost and fair value.

h) Inventories

Inventories are valued at cost or net realizable value, whichever is lower.

i) Foreign Currency

Transactions in foreign currencies are recorded at the exchange rates notified by CBEC or at the exchange rate under related forward exchange contracts. The realized exchange gains/ losses are recognized in the Profit & Loss account. All foreign currency current assets and liabilities are translated in rupees at the rates prevailing on the date of balance sheet.

j) Employee benefits

Short Term Employee Benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the realted service is rendered. Post employment benefits are recognized as an expense in the Profit and loss account for the year in which the employee has rendered services. Long Term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services.

k) Revenue Recognition Sale of goods :

Sales are recognised when the substantial risks and rewards of ownership in the goods are transferred to the buyer as per the terms of the contract and are recognised net of trade discounts, rebates, sales taxes and excise duties.

Interest :

Interest Income is recognized on time proportion basis taking into account the amount outstanding and the rate applicable.

l) Taxation

Provision for current income tax is made in accordance with Local laws. Deferred Tax liabilities and assets are recognized at substantively enacted tax rates, subject to the consideration of prudence, on timing difference.

m) Revenue :

Domestic Sales is Exclusive of Excise duty & Vat.

n) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities & Contingent Assets are neither recognised nor disclosed in the financial statements.

o) Segment Reporting

The Company's operations relate to the business segments namely transportation, service centre, Power Generation by Windmill and Manufacturing of Bitumens & Bituminous Products. These business segments represents primary basis of information set out in the financial statements. In accordance with the Accounting Standard 17 on Segment Reporting issued by the ICAI, the segment information for the year ended March 31,2012 is as follows:

Segment assets include all operating assets used by a segment and consist primarily of debtors,current assetsand fixed assets net of provisions and allowances.Segment liabilities include all operating liabilities and consist principally of creditors and other payables.


Mar 31, 2011

I. Accounting Conversion

The Financial statements are prepared under the historical cost conversion, on accrual basis of accounting in accordance with the Companies Act, 1956 and in accordance with generally accepted accounting principles (India'GAAP) are in compliance with the Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI).

II. Fixed Assets & Depreciation:

Fixed Assets are stated at original cost(including pre-opeartive expenses) less accumulated depreciation. Depreciation in respect of all assets is provided on straight-line basis at the rates prescribed under Schedule XIV of the Companies Act,1956. Depreciation on assets added during the year has been provided on pro-rata basis with reference to the date of addition/asset put to use. No depreciation has been provided on the fixed assets, which have not been used and sold during the year.

III. Inventories :

Inventories are valued at cost.

IV. Investments :

Investments are unquoted and stated at cost.Income from investments is accounted for when received.The decline in the value of the unquoted investment other than temporary is provided whenever necessary. Current investments are carried at Lower of Cost and Fair value.

V Taxation :

Current Tax is measured on the basis of estimated taxable income for the current accounting period and tax credits computed in accordance with the provisions of the income Tax Act,1961.

Deferred Tax resulting from " timing differences" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substancially enacted as on the balance sheet date. Deferred tax assets are recognised and carried forward only to the extent that there is reasonable certainty, except for carried forward losses and unabsorbed depriciation which are recognised based on virtual certainty, that the assets will be realised in furture.

VI. Revenue :

Domestic Sales is Exclusive of Excise duty & Vat.


Mar 31, 2010

I. Accounting Conversion

The Financial statements are prepared under the historical cost conversion, on accrual basis of accounting in accordance with the Companies Act, 1956 and in accordance with generally accepted accounting principles (IndiaGAAP) are in compliance with the Accouting Standards issued by the Institute of Chartered Accountants of India (ICAI).

II. Fixed Assets & Depreciation:

Fixed Assets are stated at original cost(including pre-opeartive expenses) less accumulated depreciation. Depreciation in respect of all assets is provided on straight-line basis at the rates prescribed under Schedule XIVof the Companies Act,1956. Depreciation on assets added during the year has been provided on pro-rata basis with reference to the date of addition/asset put to use. No depreciation has been provided on the fixed assets, which have not been used and sold during the year.

III. Inventories :

Inventories are valued at cost.

IV. Investments :

Investments are unquoted and stated at cost.Income from investments is accounted for when received.The decline in the value of the unquoted investment other than temporary is provided whenever necessary.

V. Revenue :

Domestic Sales is Exclusive of Excise duty & Vat.