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Accounting Policies of Ahmedabad Steelcraft Ltd. Company

Mar 31, 2015

1. COMPANY'S OVERVIEW :-

Ahmedabad Steelcraft Limited ('The Company') was incorporated on 14-07-1972 vide Certificate of Incorporation No. L27109GJ1972PLC01 1500 under the Companies Act, 1956. The Company is engaged in the business of Trading and Export of Steel Windows and Door Sections.

2. SYSTEM OF ACCOUNTING AND PREPARATION OF FINANCIAL STATEMENTS :-

a) The financial statements have been prepared in accordance with the Generally Accepted Accounting Principles (GAAP) to comply with the applicable mandatory Accounting Standards read with Revised Schedule VI and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those followed in the previous year, except wherever specified.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

c) The Company has ascertained its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities.

d) Benefit on account of entitlements to import duty free material under the "Focus Market Scheme" & other Export Incentives are accounted for on Cash basis.

3. INVENTORIES:

There is no inventory of goods at the end of the year.

4. CASH AND CASH EQUIVALENTS :

Cash and cash equivalent comprises of cash on hand and balance with Central Bank of India Cash Credit Hypothecation account, Central Bank of India Group Gratuity account, Central Bank of India (Mumbai) account, HDFC Bank Ltd Current account, HDFC Bank Ltd EPC account, account and State Bank of India Bank (Odhav) account as on 31/03/2015.

5. DEPRECIATION :

Depreciation on tangible assets is provided on the straight-line method over the useful lives of assets in accordance with Schedule II of the Companies Act, 2013

6. FIXED ASSETS :

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses like freight, duties, levies and any directly attributable cost of bringing the assets to their working condition for intended use less accumulated depreciation.

7. REVENUE RECOGNITION

* Revenue from sale of goods is recognized on transfer of significant risks and rewards of ownership in the goods to the buyer which is generally at the time of dispatch to the customer. Sales are recorded net of returns (if any), trade discounts, rebates, other pricing discounts, vat / sales tax.

* Interest on Investments / loans is recognized on a time proportion basis.

* Dividend Income on Investments is recognized when right to receive the payment is established.

8. FOREIGN EXCHANGE TRANSACTION:

a) Foreign Exchange transactions are converted into Indian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Statement of Profit & Loss on Settlement of transactions during the year.

Unsettled transactions at the close of the year are considered taking into account the exchange rate prevailing at the year end and difference is charged to Statement of Profit & Loss.

b) The investment made in foreign Company Light work LLC in the form of investment in shares and loans and advances made is considered as Non-Integral operations. The loan has been translated at closing rate of foreign exchange and the resulted exchange difference is transfer to and accumulated in a foreign currency translation Reserve account. The exchange difference on repayment of loan is accounted for and transfer from foreign currency translation account to profit and loss account.

9. EMPLOYEE BENEFITS:

Gratuity paid to employee retrenched and other payments made to employee on retrenchment are charged to Statement of Profit & Loss on payment basis.

10. INVESTMENTS :

* Valuations of long term (non-current) quoted and unquoted investments are stated at cost less provision, if any, for permanent diminution in value. Current Investments are valued at cost as per consistent practice of the Company.

* The Company has made investments in the capital of Partnership Firm as Partner in the case of the following Partnership Firm.

Name of Limited Liability Partnership Profit/Loss Ratio

Aavkar Realty 46.00 %

Aavkar Projects (Ambavadi) 11.10 %

The Company has made investments in the capital of Limited Liability Partnership (LLP) as Partner in the case of the following Limited Liability Partnership (LLP).

Name of Partnership Firm Profit/Loss Ratio

Endor Properties LLP 6.22 % Tesla Properties LLP 11.72 %

Viewport Properties LLP 2.92 %

Notes Relating to Investment in Lightworks LLC.

During the F.Y. 2014-15, there is neither any new investment / conversion / sale made by the Company of Equity Shares (Common Share) of US $ 1 each fully paid up of Light works LLC. Further, the Company has also given loan to Light works LLC. Company has accounted interest receivable from Light works LLC in books of account as per accounting policies and requirement of accounting standard. Company has made total investment of 7,30,697 US$ the details of which are as under:

Common shares 50% 4,87,847 $

Loan Given 2,42,850 $

7,30,697 $

During the year ending on 31-12-2014 light works LLC has incurred losses and net worth of the Company is negative and there is less possibility of future profit from the operation, hence management is of opinion that there is permanent diminution in the value of Investment in light works LLC. The Long Term (Non Current) unquoted investment in shares of light works LLC is shown as Nominal Value at Re 1 each and provision is made for permanent diminution in value of Investment in accordance with the Accounting Standard-13.

11. PROVISION FOR TAXATION :

Tax expenses comprises of current tax and deferred tax:-

(i) CURRENT TAX:-

No Provision for taxation has been made as there is no tax liability in accordance with the direct tax laws prevailing for the relevant assessment years.

(ii) DEFERRED TAX

Deferred tax is recognized, subject to the consideration of prudence, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax Assets of Rs. 4,32,565/- has been created as per Accounting Standard 22 "Accounting of Tax on Income" issued by ICAI on timing difference as follow:-

Depreciation Provided in the Books Rs. 32,25,659

Depreciation allowable as per I.T. Act. Rs. 18,25,773

Timing Difference Rs. 13,99,886

12. EARNINGS PER SHARE

Basic earnings per share are computed using the weighted average number of equity shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year, except where the results would be anti-dilutive.

Earning per share (EPS), is calculate as under :

Particulars 31/03/2015 31/03/2014

Profit/(Loss) attributable to the Shareholders (Rs.) (A) (2,23,37,609) 1,81,07,320 Basic/Weighted average number Of Equity Shares outstanding during the year (B) 40,92,000 40,92,000

Nominal Value of Equity Share (Rs.) 10/- 10/-

Basic/Diluted Earning per share (Rs.) (5.45) 4.43

13. RELATED PARTY TRANSACTIONS:-

Disclosure of transactions with Related Parties ,as required by Accounting Standard 18-" Related Party Disclosures" as specified in the Companies (Accounting Standard) Rules 2006 (as amended) has been set out in a separate statement annexed to this note. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by the management and information available with the Company.

14. GENERAL NOTES:

1. As regards the other Accounting Standards, they are statutorily applicable to our Company i.e Ahmedabad Steelcraft Limited but as there are no transactions inviting those Accounting Standards, no specific disclosures on the same are made.

2. Previous year's figures have been regrouped / rearranged wherever necessary to make them comparable with current year figures.

3. Figures have been rounded off to the nearest Rupee for the purpose of presentation.

4. Debtors and Creditors balances appearing in the balance sheet are subject to confirmation of respective parties.

5. Since there are no purchases from S.S.I. Units, there are no outstanding creditors of S.S.I. Units.

6. Amount paid or payable to Auditors:-

As at 31-03-15 As at 31-03-14

i) Audit fees 1,14,000 1,12,360

ii) Tax Audit Fees 57,000 56,180

1,71,000 1,68,540

7. Value of Imports, Expenditure and earning in foreign currency:

As at 31-03-15 As at 31-03-14

i) CIF value of Imports Nil Nil

ii) Spare parts and Components Nil Nil

iii) Earning in Foreign Currency

FOB Value of Export 1,80,41,765 10,91,34,684

Interest Income Received Nil 10,86,399

From Lightworks LLC

iv) Expenditure in foreign Currency Nil Nil


Mar 31, 2014

1. COMPANY ''S OVERVIEW :-

Ahmedabad Steelcraft Limited (The Company'') was incorporated on 14-07-1972 vide Certificate of Incorporation No. L27109GJ1972PLC011500 under the Companies Act, 1956. The company is engaged in the business of Trading and Export of Steel Windows and Door Sections.

2. SYSTEM OF ACCOUNTING AND PREPARATION OF FINANCIAL STATEMENTS :-

a) The financial statements have been prepared in accordance with the Generally Accepted Accounting Principles (GAAP) to comply with the applicable mandatory Accounting Standards read with Revised Schedule VI and the relevant provisions of the Companies Act, 1956 (as per Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September of the Ministry of Corporate Affairs). The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those followed in the previous year, except wherever specified.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

c) The Company has ascertained its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities.

d) Benefit on account of entitlements to import duty free material under the "Focus Market Scheme" & other Export Incentives are accounted for on Cash basis.

3. INVENTORIES :

There is no inventory of goods in transit. Inventory of Finished Goods is valued at cost or market value whichever is lower. There is no closing stock of Finished Goods as at 31.03.2014.

4. CASH AND CASH EQUIVALENTS :

Cash and cash equivalent comprises of cash on hand and balance with Central Bank of India Cash Credit Hypothecation account, Central Bank of India Group Gratuity account, Central Bank of India (Mumbai) account, Central Bank of India (Pune) account, HDFC Bank Ltd Current account, HDFC Bank Ltd EPC account, HDFC Bank Ltd EEFC account and State Bank of India Bank (Odhav) account as on 31/03/2014.

5. DEPRECIATION :

Depreciation on the assets has been provided on straight line method at the rates prescribed under Schedule XIV to the Companies Act, 1956.

6. FIXED ASSETS :

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses like freight, duties, levies and any directly attributable cost of bringing the assets to their working condition for intended use less accumulated depreciation.

7. REVENUE RECOGNITION

Revenue from sale of goods is recognized on transfer of significant risks and rewards of ownership in the goods to the buyer which is generally at the time of dispatch to the customer. Sales are recorded net of returns (if any), trade discounts, rebates, other pricing discounts, vat / sales tax.

Interest on Investments / loans is recognized on a time proportion basis.

Dividend Income on Investments is recognized when right to receive the payment is established.

8. FOREIGN EXCHANGE TRANSACTION:

a) Foreign Exchange transactions are converted into Indian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Statement of Profit & Loss on final payment of the liability. Unsettled transactions at the close of the year are considered taking into account the exchange rate prevailing at the year end and difference is charged to Statement of Profit & Loss.

b) Variation due to fluctuation in exchange rate as on the date of Balance Sheet, the increase / decrease is accounted in respect of Investment and Advance to foreign company is accounted for in the Foreign Currency Transaction Reserve.

9. EMPLOYEE BENEFITS:

Gratuity paid to employee retrenched and other payments made to employee on retrenchment are charged to Statement of Profit & Loss on payment basis.

10. INVESTMENTS :

The Company has made investments in the capital of Partnership Firm as Partner in the case of the following Partnership Firm.

Name of Partnership Firm Profit/Loss Ratio

Aavkar Realty 46.00 %

Aavkar Projects (Ambavadi) 11.10 %

Endor Properties LLP 6.22 %

Tesla Properties LLP 11.72 %

The Company has also contributed Rs. 25,00,000/- towards capital in View Point Properties which has been shown as "Investment in the Capital of Partnership Firm" in Note - I "Other Current Investments". Notes Relating to Investment in Lightworks LLC. During the F.Y. 2013-14, there is neither any new investment / conversion / sale made by the company of Equity Shares (Common

11. TAXATION :

Deferred tax is recognized, subject to the consideration of prudence, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

13. RELATED PARTY TRANSACTIONS:-

Disclosure of transactions with Related Parties ,as required by Accounting Standard 18-" Related Party Disclosures" as specified in the Companies (Accounting Standard) Rules 2006 (as amended) has been set out in a separate statement annexed to this note. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by the management and information available with the company._

14. GENERAL NOTES:

As regards the other Accounting Standards, they are statutorily applicable to our Company i.e Ahmedabad Steelcraft Limited but as there are no transactions inviting those Accounting Standards, no specific disclosures on the same are made. SCHEDULE FORMING PART OF ACCOUNTS AS ON 31ST MARCH, 2014


Mar 31, 2013

1. SYSTEM OF ACCOUNTING :-

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956, as adopted consistently by the company, except for certain fixed assets which have been revalued.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

c) Benefit on account of entitlements to import duty free material under the "Duty Entitlement Passbook" scheme & other Export I ncentives are accounted for on Cash basis.

2. FIXED ASSETS :

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses.

3. DEPRECIATION :

Depreciation on the assets has been provided on straight line method at the rates prescribed under Schedule XIV to the Companies Act, 1956.

4. INVENTORIES :

There is no inventory of goods in transit. Inventory of Finished Goods is valued at cost or market value whichever is lower. There is no closing stock of Finished Goods as at 31.03.2013.

5. INVESTMENTS :

Valuation of long term (non-current) quoted investment are stated at cost less provision, if any, for permanent diminution in value. Unquoted long term (non-current) investment are valued at cost. Current Investment are valued at cost as per consistent practice of the Company.

6. FOREIGN EXCHANGE TRANSACTION:

a) Foreign Exchange transactions are converted into I ndian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Statement of Profit & Loss on final payment of the liability. Unsettled transaction at the close of the year are considered taking into account the exchange rate prevailing at the year end and difference is charged to Statement of Profit & Loss.

b) Variation due to fluctuation in exchange rate as on the date of Balance Sheet, the increase / decrease is accounted in respect of I nvestment and Advance to foreign company is accounted for in the Foreign Currency Transaction Reserve.

c) The exchange rate difference so occurred in conversion of Equity Shares & Preference Shares into Common shares has been duly accounted for and transferred to Foreign Currency Translation Reserve.

7. EMPLOYEE BENEFITS :

Gratuity paid to employee retrenched charged to Statement of Profit & Loss. Other payment made to employee on retrenchment of employees charged to Statement of Profit & Loss on payment basis.

8. TAXATION :

Deferred tax liability of Rs. 2,32,108/- has been created as per Accounting Standard 22 "Accounting of Tax on Income" issued by ICAI on timing difference as follow..

Depreciation Provided Rs. 17,47,066

Depreciation allowable as per IT. Act. Rs. 24,98,223

Timing Difference Rs. 7,51,157


Mar 31, 2012

1. SYSTEM OF ACCOUNTING:-

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956, as adopted consistently by the com- pany, except for certain fixed assets which have been revalued.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and ex- penditure on accrual basis.

c) Benefit on account of entitlements to import duty free material under the "Duty Entitlement Passbook" scheme & other Export Incentives are accounted for on Cash basis.

2. FIXED ASSETS :

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses. They are stated at revalued amount being fair market value on the basis of valuation made by approved valuer. Surplus on account of revaluation is credited to the revaluation reserve account.

3. DEPRECIATION :

Depreciation on the assets has been provided on straight line method at the rates prescribed under Schedule XIV to the Companies Act, 1956.

4. INVENTORIES :

There is no inventories of raw materials, goods in transit, consumable stores, furnace oil and lubricants. Inventories of Finished Goods is valued at cost or market value whichever is lower. There is no closing stock of Finished Goods as at 31.03.2012.

5. INVESTMENTS :

Valuation of long term (non-current) quoted investment are stated at cost less provision, if any, for permanent diminution in value. Unquoted long term (non-current) investment are valued at cost. Current Investment are valued at cost as per consistent practice of the Company.

6. FOREIGN EXCHANGE TRANSACTION:

a) Foreign Exchange transactions are converted into Indian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Statement of Profit & Loss on final payment of the liability. Unsettled transaction at the close of the year are considered taking into account the exchange rate prevailing at the year end and diff. is charged to Statement of Profit & Loss.

b) Variation due to fluctuation in exchange rate as on the date of Balance Sheet, the increase / decrease is accounted in respect of Investment and Advance to foreign company is accounted for in the Foreign Currency Transaction Reserve.

7. EMPLOYEE BENEFITS :

Gratuity paid to employee retrenched charged to Statement of Profit & Loss. Other payment made to employee on retrenchment of employees charged to Statement of Profit & Loss on payment basis.

8. TAXATION :

Deffered tax liability of Rs.3,55,955/- has been created as per Accounting Standard 22 "Accounting of Tax on I ncome" issued by ICAI on timing difference as follow.


Mar 31, 2011

1. SYSTEM OF ACCOUNTING :-

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956, as adopted consistently by the company, except for certain fixed assets which have been revalued.

b) The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

c) Benefit on account of entitlements to import duty free material under the "Duty Entitlement Passbook" scheme & other Export Incentives are accounted for on Cash basis which was hither to accounted for on accrual basis.

2. FIXED ASSETS:

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses. They are stated at revalued amount being fair market value on the basis of valuation made by approved valuer. Surplus on account of revaluation is credited to the revaluation reserve account.

3. DEPRECIATION:

Depreciation on the assets has been provided on straight line method at the rates prescribed under Schedule XIV to the Companies Act, 1956.

4. INVENTORIES:

There is no inventories of raw materials, goods in transit, consumable stores, furnace oil and lubricants. Inventories of Finished Goods is valued at cost or market value whichever is lower. There is no closing stock of Finished Goods as at 31.03.2011.

5. INVESTMENTS:

Valuation of long term quoted investment are stated at cost less provision, if any. for permanent diminution in value. Unquoted long term investment are valued at cost. Current Investment are valued at cost as per consistent practice of the Company.

6. FOREIGN EXCHANGE TRANSACTION:

a) Foreign Exchange transactions are converted into Indian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Profit & Loss A/c on final payment of the liability. Unsettled transaction at the close of the year are considered taking into account the exchange rate prevailing at the year end and difference is charged to Profit & Loss Account.

b) Variation due to fluctuation in exchange rate as on the date of Balance Sheet, the increase / decrease is accounted in respect of Investment and Advance to foreign company is accounted for in the Foreign Currency Translation Reserve.

7, EMPLOYEE BENEFITS:

Gratuity paid to employee retrenched charged to Profit & Loss Account. Other payment made to employee on retrenchment of employees charged to Profit & Loss Account on payment basis.


Mar 31, 2010

1. SYSTEM OF ACCOUNTING :

(a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act. 1956, as adopted consistently by the company, except for certain fixed assets which have been revalued.

(b)The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

(c) Benefit on account of entitlements to import duty free material under the "Duty Entitlement Pass book" scheme is accounted for on accrual basis. Other Export incentives are also accounted for on accrual basis.

2. FIXED ASSETS:

Fixed Assets are stated at cost inclusive of incidental and/or installation expenses. They are stated at revalued amount being fair market value on the basis of valuation made by approved valuer, Surplus on account of revaluation is credited to the revaluation reserve account.

3. DEPRECIATION :

Depreciation on the Assets has been provided on straight line method at the rates prescribed under Schedule XIV to the Companies Act. 1956.

4. INVENTORIES :

There is no inventory of raw materials, consumable stores, furnace oil and lubricants. Inventories of Finished goods is valued at cost or market value whichever is lower.

5. INVESTMENTS :

Valuation of long term quoted investment are stated at cost less provision, if any, for permanent diminu- tion in value. Unquoted long term investment are valued at cost. Current Investment are valued at cost as per consistent practice of the Company.

6. FOREIGN EXCHANGE TRANSACTION :

(a) Foreign Exchange transactions are converted into Indian Rupees at the rate of exchange prevailing on the date of transaction. Exchange rate difference is charged to Profit & Loss A/c on final payment of the liability. Unsettled transaction at the close of the year are considered taking into account the exchange rate prevailing at the year end and diff. is charged to Profit & Loss Account.

(b) Variation due to fluctuation in exchange rate as on the date of balance sheet, the increase/decrease is accounted in respect of Investment and Advances to foreign company is accounted for in the foreign currency transaction reseerve.

7. EMPLOYEE BENEFITS :

Gratuity paid to employee retrenched charged to profit & Loss Account. Other payment made to employee on retrenchment of employees charged to Profit & Loss Account on payment basis.

 
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