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Accounting Policies of Arihant Multi Commercial Ltd. Company

Mar 31, 2015

I. Basis of Accounting and preparation of financial statements :

These financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, till the Standards of Accounting or any other addendum thereto are prescribed by Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing Accounting Standards notified under the Companies Act 1956 (the Act) shall continue to apply. Consequently, these financial statements are prepared to comply in all material aspects with the Accounting Standards notified under sub section (3C) of section 211 of the Act {Companies (Accounting Standards) Rules, 2006} and other relevant provisions of the Companies Act 2013.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current/non-current classification of assets and liabilities.

ii. Use Of Estimates :

The presentation of financial statements in conformity with the generally accepted accounting principles require estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenue and expenses during the reported period. Differences between the actual result and estimates are recognized in the period in which the results are known/materialize. Management believes that the estimates used in the preparation of financial statements are prudent and reasonable. Future results could differ from these estimates.

iii. Cash Flow :

Cash flow statement has been prepared in accordance with the "indirect method" as explained in the Accounting Standard 3 issued by the Institute of Chartered Accountants of India.

iv. Fixed Assets :

Tangible assets are stated at cost of acquisition, including any attributable cost for bringing the assets to its working condition for its intended use, less accumulated depreciation and impairment loss.

Depreciation on tangible assets is calculated on a pro-rata basis on the Written Down Value Method at the rates prescribed under Schedule II to the Companies Act, 2013 with the exception of the following:- assets costing Rs. 5,000/- or less are fully depreciated in the year of purchase.

v. Revenue recognition :

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized

a) Income from advisory services is recognised on accrual basis.

b) Profit / loss earned on sale of investment is recognised on trade date basis. Profit/Loss on sale of Investment is determined on basis of FIFO cost of the investment sold.

Other income recognition

Interest on investments and Loans and Advances is booked on a time proportion basis taking into account the amounts invested or loan given and the rate of interest.

Dividend income is recognized when the right to receive payment is established.

Expenditure

Expenses are accounted for on accrual basis and provision is made for all known losses.

vi. Foreign Currency transactions :

Foreign currency transactions are recorded in the books at exchange rates prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the period are recognized as income or expense in the profit and loss account of the same period.

Foreign currency assets and liabilities are translated at the period end rates and the resultant exchange differences, are recognized in the profit and loss account.

vii. Borrowing Cost :

Borrowing Costs that are directly attributable to the acquisition or production of qualifying assets are capitalized as the cost of the respective assets. Other Borrowing Costs are charged to the Profit and Loss Account in the period in which they are incurred.

viii. Employees benefits :

All employee benefit obligations payable wholly within twelve months of the rendering the services are classified as Short Term Employee Benefits. Such Benefits are estimated and provided for in the period in which the employee renders the related service.

Post employment Benefits

1. P.F. and E.S.I.C Scheme is not applicable to the company.

2. Gratuity is accounted when an employee works for more the 6 months.

ix. Inventories

Inventories are measured at lower of the cost and net realizable value. Cost of inventories comprises all costs of purchase (net of input credit) and other costs incurred in bringing the inventories to their present location and condition. Costs of consumable and trading products are determined by using the First-In First-Out Method (FIFO).

x. Investments

Long-term Investments are carried individually at cost less provision for diminution, other than temporary, in the value of such Investments.

Current investments are carried individually at the lower of cost and fair value. Costs of investments include acquisition charges such as brokerage, fees and duties.

xi. Accounting for taxes on income:

a) Income tax comprises the current tax and net change in deferred tax assets, which are made in accordance with the provisions as per the Income Tax Act, 1961.

b) Deferred Tax resulting from timing differences between accounting income and taxable income for the period is accounted for using the tax rates and laws that have been enacted or substantially enacted as at the balance sheet date. Te deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax asset can be realized.

xii. Leased Assets :

Assets acquired on leases where a significant portion of the risks and rewards of the ownership are retained by the lessor, are classified as Operating Leases. Te rental and all other expenses of leased assets are treated as revenue expenditure.

xiii. Provisions and Contingent liabilities :

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

xiv. Impairment of Assets :

The Company assesses at each balance sheet date whether there is any indication that an assets may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or recoverable amount of the cash generating unit to which the assets belongs is less than the carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as impairment loss and is recognized in the profit and loss account. If at the balance date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the assets is reflected at the recoverable amount.

xv. Cash and cash equivalents :

The Company considers all highly liquid financial instruments, which are readily convertible into cash and have original maturities of three months or less from the date of purchase, to be cash equivalents.

xvi. Segment information :

a) The Company's business segments are identified around products in which company deals.

b) The accounting policies used in the preparation of the financial statements of the Company are also applied for segment reporting.

c) Segment revenues, expenses, assets and liabilities are those, which are directly attributable to the segment or are allocated on an appropriate basis. Corporate and other revenues, expenses, assets and liabilities to the extent not allocable to segments are disclosed in the reconciliation of reportable segments with the financial statements.

d) Figures in brackets are in respect of the previous year.

e) Segment Revenues, Results and Other Information:

xvii. Earnings per Share:

Earnings per share is calculated by dividing the profit/(loss) attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year. The number used in calculating the basic and diluted earnings per share are stated below:

xviii. Related Party Transactions:

A. Related parties and their relationship

key Management Personnel:

Mr. Deepak Sitaram Bansal - Managing Director*

Ms. Priya M Pareek - Chief Financial Officer*

Mr. Vijay Achari - Chief Financial Officer#

Mr. Nitin Kore - Company Secretary*

Mr. Pratik Pujara - Company Secretary#

Mr. Alok Kumar Behra - Managing Director#

# Mr. Alok Kumar Behra Resigned from Directorship w.e.f 10.12.2014

# Mr. Pratik Pujra Resigned from Company Secretary w.e.f. 05.03.2015

# Mr. Vijay Achari Resigned from Chief Financial Ofcer w.e.f. 25.03.2015

* Appointment as Managing Director w.e.f. 01.10.2014

* Appointment as Chief Financial Officer w.e.f. 25.03.2015

* Appointment as Company Secretary w.e.f. 05.03.2015

others: enterprises over which key Management Personnel are able to exercise significant influence / controls

- Mahavir Industries Limited

- Raiment Consultancy Services Private Limited

- Mimo Trading Private Limited

- Vinita Common trade Private Limited

- Ganwari Silica Private Limited

- Basuki Plaza Private Limited

- GCM Commodity & Derivatives Limited

- Mindscale Projects Private Limited


Mar 31, 2014

1. Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

2. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialised.

3. Inventories

Inventories are valued at the lower of cost (on FIFO basis) and the net realisable value after providing for obsolescence and other losses, where considered necessary.

4. Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

5. Cash Flow Statements

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

6. Revenue Recognition

All incomes and expenditure are recognised as per ‘Accounting Standard-9'' accounted on accrual basis except where stated otherwise.

Dividends on investments are accounted for when the right to receive the dividend is established.

7. Employee Benefits

a. P. F. and E.S.I.C Scheme is not applicable to the company.

b. Gratuity is accounted when an employee works for more than 6 Months.

8. Segment Reporting

The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal organisation and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment.

Inter-segment revenue is accounted on the basis of transactions which are primarily determined based on market / fair value factors.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities"

9. Investments

Long-term investments are carried individually at cost less provision for diminution, other than temporary, in the value of such investments.

Current investments are carried individually, at the lower of cost and fair value. Costs of investments include acquisition charges such as brokerage, fees and duties.

10. Borrowing Cost

Borrowing costs directly attributable to the acquisition and construction of qualifying fixed assets are capitalized as part of the cost of the assets, up to the date the asset is put to use. Other borrowing costs are charged to the Profit and Loss Account.

11. Taxes on Income

Current Tax is determined as the tax payable in respect of taxable income for the year, if any. Deferred tax for the year is recognised on timing difference; being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred Tax Assets and Liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Tax Assets are recognised and carried forward only if there is a reasonable/virtual certainty of realisation.

12. Provisions and Contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

13. Impairment of Assets

At the end of each year, the Company assesses whether any impairment loss may have occurred in respect of its Assets in accordance with Accounting Standard - 28 "Impairment of Assets" issued by the Institute of Chartered Accountants of India, and Impairment Losses if any are accounted for by the company in accordance with the Standard applicable.


Mar 31, 2012

A) Basis of Accounting

The financial statements are prepared on accrual basis following the historical cost convention in accordance with Indian Generally Accepted Accounting Principles (GAAP). GAAP comprises the mandatory Accounting standards (as applicable to small and Medium Sized Enterprises) referred to inSection 211 (3C) and other requirements of the companies Act,1956.

b) Use of Estimates

The preparation of financial statements in comformity with I-GAAP requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the period.

c) Revenue recognitions

All incomes are recognized on accural basis. Sales are recognized up to the transfer of significant risk and reward of ownership to the customers.

d) Expenditure

Expneses are accounted on accrual basis and provisions is made for all known losses and liabilities.

e) Inventories

The inventories are valued at cost and FIFO basis and realizable value which ever is lower.

f) Depreciation / Amortization

The Company is not having any Fixed Assets during the year under review.

g) Taxes on Income

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of Income Ta x Act, 1961. Deferred tax is recognised, on timing differences, being the difference between taxable income.


Mar 31, 2011

1. Basis Of Accounting

The financial statements are prepared on accrual basis following the historical cost conventional in accordance with Indian Generally Accepted Accounting Principles(GAAP). GAAP comprises the mandatory Accounting Standards(as applicable to Small and Medium Sized Enterprises) referred to in Sector 211 (3C) and other requirements of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with I-GAAP requires that the management of the company makes estimates and assumptions that affect the reported amounts of income and expenses of the period.

3. Revenue Recolonisations

All incomes are recognized on accrual basis. Sales are recognized up to the transfer of significant risk and reward of ownership to the customers.

4. Expenditure

Expenses are accounted on accrual basis and provision is made for all known losses and liabilities.

5. Inventories

The Inventories are valued at cost and FIFO basis and realizable value Which ever is lower.

6.Taxes on Income

Current tax is determined based on the provisions of the Income Tax Act, 1961 including treatment of Retention amount as a contingent amount taxable in the year of its accrual/receivable.


Mar 31, 2010

1.BASIS OF PREPARATION OF FINANCIAL STATEMENT

The accompanying financial statements have been prepared under historical cost convention on an accrual basis in accordance with generally accepted accounting principals and provisions of the company act 1956 and the applicable accounting standards issued by Institute of Chartered Accountants of India. The accounting policies are consistent with those used in previous year.

2. USE OF ESTIMATES

The preparation of financial statements, in conformity with generally accepted accounting principals, requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the financial statements and the reported amounts of revenues and expenses during the reporting year. Difference between actual results and estimates are recognized in the year in which result are known / materialize.

3. FIXED ASSETS

Fixed assets are recorded at cost of acquisition or construction including incidental expenses. They are seated at historical cost less accumulated depreciation and accumulated impairment losses, If any.

4. INVESTMENTS

Long term investments are stated at cost and provision of dimunition is made if the decline of value is other than temporary in nature.

5. INVENTORIES

Inventories are valued at cost and FIFO basis.

6. TAXATION

Provision is made for Income Tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income Tax Act 1961

Deferred income Tax is provided, using the liability method, on all temporary differences at the Balance Sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purpose.

Deferred tax assets recognized only to the extent that there is a reasonable certainty that sufficient future taxable profits will be available against which such deferred tax assets can be realized.

Deferred Tax Assets and liabilities are measured using the tax rates and the law that have been enacted or subsequently enacted at the Balance Sheet date.

7. FOREIGN CURRENCY TRANSACTION .

Transactions in foreign currency are recorded at original rate of exchange in force at the time transactions are effected Exchange differences arising on settlement of monetary item or on reporting companies' monetary item at rate different from those at which they were initially recorded during the year or reported in previous financial statement are recognized as income or as expenses in the year which they arise.

8. PROVISIONS CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement of recognised when there is present probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recongised nor disclosed in the financial statement.

9. BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying assets is one mat necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are charged to revenue.

10. IMPAIRMENT OF ASSETS

An Assets is treated as impaired when the carrying cost of the assets exceeds its recoverable value. An impairment loss recognised in the prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

 
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