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Arrow Coated Products Ltd. Accounting Policies | Accounting Policy of Arrow Coated Products Ltd.
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Accounting Policies of Arrow Coated Products Ltd. Company

Mar 31, 2015

1 Corporate Overview/Information

The Company is engaged in business of water soluble film and bio compostable products and having Patents Income for such products / Technology.

a) Basis of Preparation of Financial Statements:

The financial statement have been prepared on the basis of going concern, under historical cost convention, to comply in all material aspect with applicable accounting principles in India, the Accounting standards section 133 of Companies Act ,2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013.

The preparation of financial statements in conformity with accounting standards requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities at the date of financial statement, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

All assets and liabilities have been classified as current or non - current as per the operating cycle criteria set out in the schedule III of the Companies Act,2013.

b) Fixed Assets, Depreciation And Impairment Loss:

Tangible Assets

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Cost includes expenses related to acquisition and financing cost on borrowing during construction period. Assets acquired on Hire purchase are capitalised to the extent of Principal Value.

Depreciation on Fixed Assets has been provided on the basis and manner provided in Schedule II to The Companies Act 2013, and any assets whose life has been expire as per new Companies Act 2013 calculation has been transferred to Reserve and Surplus under head Depreciation Adjustment Accounts. Leasehold land is shown at cost and no write offs are made in respect thereof.

Intangible Assets

Costs relating to Patents are written off over the remaining useful life from the day of Grant.

In case, the recoverable amount of fixed assets is lower than its carrying amount, a provision is made for the impairment loss.

c) Investments:

Long-term investments other than trade are stated at cost of acquisition less provision for diminution in value other than temporary, if any.

Holding of investment in subsidiaries and Associated Companies are of strategic importance to the company and therefore the company does not consider it necessary to provide decrease in the book value of such investment, till such relationship continues with the investee company.

d) Prior Period Adjustments:

All items of Income/Expenditure pertaining to prior period (except those not exceeding Rupees One Thousand in each case which is accounted through respective revenue accounts) are accounted through Prior Period account.

e) Inventories:

Raw Materials are valued at cost. Finished Goods are valued at lower of cost or net realizable value.

f) Revenue Recognition:

Sales exclude Sales Tax, Excise Duty and other charges such as freight, insurance and other Incidental charges. Dividend from investments in the shares is accounted for on the basis of the date of declaration of dividend falling within the accounting year. Interest Income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

g) Retirement Benefits:

Notes to the financial statements for the year ended March 31, 2015

The company makes monthly contribution as per the applicable statute for Provident Fund and charges off the same to the Profit and Loss account.

Provision for leave entitlement is accrued and provided for at the end of the financial year.

The Company has created an Employees' Group Gratuity Fund, which has taken a Group Gratuity cum Life Insurance Policy from the Life Insurance Corporation of India. Gratuity is provided on the basis of premium paid on the above policy as intimated by Life Insurance Corporation of India. The adequacy of the fund along with the provision is as per the actuarial valuation.

h) Borrowing Cost:

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are capitalised till the month in which the asset is ready to use as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which this are incurred.

i) Foreign Currency Transactions:

Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. At the year-end monetary items denominated in foreign currencies are converted into rupee equivalent at the year-end exchange rates. All exchange differences arising on settlement and conversion on foreign currency transaction are dealt with in profit and loss account; Investments in shares of foreign subsidiary companies are expressed in Indian currency at the rates of exchange prevailing at the time when the original investments were made.

j) Accounting For Taxes On Income:

The provision for current income tax has been made in accordance with the Income Tax Law prevailing for the relevant assessment year after considering various admissible relief’s’.

Deferred tax for the year is recognised, on timing differences being the difference between the taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

Deferred tax asset and liabilities are measured using the tax rates and tax rules that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax asset are recognized and carried forward only if there is reasonable / virtual certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realisation.

k) Expenditure During Construction And On New Projects:

In case of new Industrial units and substantial expansion of existing units, all pre- operating expenditure specifically for the project, incurred up to the date of installation, is capitalised and added pro rata to the cost of fixed assets.

l) 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 are not recognised but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

m) Deferred Revenue Expenditure:

Preliminary Expenses and Shares Issue Expenses are amortised over a period of 10 years.

n) Research and Development

Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of products are also charged to the Statement of Profit and Loss unless a product’s technical feasibility has been established, in which case such expenditure is capitalised. The amount capitalised comprises expenditure that can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Fixed assets utilised for research and development are capitalised and depreciated in accordance with the policies stated for Fixed Assets.


Mar 31, 2012

A) Basis of Preparation of Financial Statements:

The financial statement have been prepared on the basis of going concern, under historical cost convention, to comply in all material aspect with applicable accounting principles in India, the Accounting standards issued by the ICAI (except as other wise stated) and the relevant provision of Companies Act, 1956.

The preparation of financial statements in conformity with accounting standards requires manage- ment to make estimates and assumptions that affect the reported amounts of the assets and liabilities at the date of financial statement and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

All assets and liabilities have been classified as current or non-current as per the operating cycle criteria set out in the Revised Schedule VI to the Companies Act, 1 956.

b) Fixed Assets, Depreciation and Impairment Loss:

Fixed Assets are stated at cost net of accumulated depreciation. Cost includes expenses related to acquisition and financing cost on borrowing during construction period. Assets acquired on Hire purchase are capitalised to the extent of Principal Value.

Depreciation on Fixed Assets has been provided on written down value basis and manner provided in Schedule XIV to The Companies Act 1 956. Additions during the Year are depreciated on pro-rata basis. Leasehold land is shown at cost and no write offs are made in respect thereof.

Costs relating to Patents are written off over the remaining useful life from the day of Grant.

In case, the recoverable amount of fixed assets is lower than its carrying amount, a provision is made for the impairment loss.

c) Investments:

Long-term investments other than trade are stated at cost of acquisition less provision for diminu- tion in value other than temporary, if any.

Holding of investment in subsidiaries and Associated Companies are of strategic importance to the Company and therefore the Company does not consider it necessary to provide decrease in the book value of such investment, till such relationship continues with the Investee Company.

d) Prior Period Adjustments:

All items of Income/Expenditure pertaining to prior period (except those not exceeding Rupees One Thousand in each case which is accounted through respective revenue accounts) are accounted through Prior Period account.

e) Inventories:

Raw Materials are valued at cost. Finished Goods are valued at lower of cost or net realizable value

f) Revenue Recognition:

Sales exclude Sales Tax, Excise Duty and other charges such as freight, insurance and other Inci- dental charges. Dividend from investments in the shares is accounted for on the basis of the date of declaration of dividend falling within the accounting year. Interest Income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

g) Retirement Benefits:

The Company makes monthly contribution as per the applicable statute for Provident Fund and charges off the same to the Statement of Profit and Loss.

Provision for leave entitlement is accrued and provided for at the end of the financial year.

The Company has created an Employees' Group Gratuity Fund, which has taken a Group Gratuity cum Life Insurance Policy from the Life Insurance Corporation of India. Gratuity is provided on the basis of premium paid on the above policy as intimated by Life Insurance Corporation of India. The adequacy of the fund along with the provision is as per the actuarial valuation.

h) Borrowing Cost:

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are capitalised till the month in which the asset is ready to use as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which this are incurred.

i) Foreign Currency Transactions:

Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. At the year-end monetary items denominated in foreign currencies are converted into rupee equivalent at the year-end exchange rates. All exchange differences arising on settlement and conversion on foreign currency transaction are dealt with in Statement of profit and loss.

Investments in shares of foreign subsidiary companies are expressed in Indian currency at the rates of exchange prevailing at the time when the original investments were made.

j) Accounting For Taxes On Income:

The provision for current income tax has been made in accordance with the Income Tax Law prevailing for the relevant assessment year after considering various admissible relief's'.

Deferred tax for the year is recognised, on timing differences being the difference between the taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

Deferred tax asset and liabilities are measured using the tax rates and tax rules that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax asset are recognized and carried forward only if there is reasonable / virtual certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realisation.

k) Expenditure During Construction and on New Projects:

In case of new Industrial units and substantial expansion of existing units, all pre- operating expen- diture specifically for the project, incurred up to the date of installation, is capitalised and added pro rata to the cost of fixed assets.

l) 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 are not recognised but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

m) Deferred Revenue Expenditure:

Preliminary Expenses and Shares Issue Expenses are amortised over a period of 10 years.


Mar 31, 2010

I. Basis of Accounting:

The financial statement have been prepared on the basis of going concern, under historic cost convention, to comply in all material aspect with applicable accounting principles in India, the Accounting standards issued by the ICAI (except as other wise stated) and the relevant provision of Companies Act, 1956.

The preparation of financial statements in conformity with accounting standards requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities at the date of financial statement, and the reported amounts of revenue and expenses during the reporting period. Actual results could differfrom those estimates.

II. Fixed Assets. Depreciation And Impairment Loss:

Fixed Assets are stated at cost net of accumulated depreciation. Cost includes expenses related to acquisition and financing cost on borrowing during construction period. Assets acquired on Hire purchase are capitalised to the extent of Principal Value.

Depreciation on Fixed Assets has been provided on written down value basis and manner provided in Schedule XIV to The Companies Act 1956. Additions during the Year are depreciated on pro-rata basis. Leasehold land is shown at cost and no write offs are made in respect thereof.

Costs relating to Patents are written off over the remaining useful life from the day of Grant.

In case, the recoverable amount of fixed assets is lower than its carrying amount, a provision is made for the impairment loss.

III. Investments:

Long-term investments other than trade are stated at cost of acquisition less provision for diminution in value other than temporary, ifany.

Holding of investment in subsidiaries and Associated Companies are of strategic importance to the company and therefore the company does not consider it necessary to provide decrease in the book value of such investment, till such relationship continues with the investee company

IV. Prior Period Adjustments:

All items of Income/Expenditure pertaining to prior period (except those not exceeding Rupees One Thousand in each case which is accounted through respective revenue accounts) are accounted through Prior Period Adjustment account.

V. Inventories:

Raw Materials are valued at cost. Finished Goods are valued at lower of cost or net realizable value.

VI. Revenue Recognition:

Sales: Sales excludes Sales Tax and other charges such as freight, insurance and other incidental charges.

Dividend: Dividend from investments in the shares is accounted for on the basis of the date of declaration of dividend falling within the accounting year.

VII. Deferred Revenue Expenditure:

Preliminary Expenses and Shares Issue Expenses are amortised over a period of 10 years.

VIM. Retirement Benefits:

The company makes monthly contribution as per the applicable statute for Provident Fund and charges off the same to the Profit

Provision fo leave entitlement is accrued and provided for at the end of the financial year.

The Company has created an Employees Group Gratuity Fund, which has taken a Group Gratuity cum Life Insurance Policy from the Life Insurance Corporation of India. Gratuity is provided on the basis of premium paid on the above policy as intimated by Life Insurance Corporation of India. The adequacy of the fund along with the provision is as per the actuarial valuation.

IX. Borrowing Cost:

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are capitalised till the month in which the asset is ready to use as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which this are incurred

X. Foreign Currency Transactions:

Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. At the year-end monetary items denominated in foreign currencies are converted into rupee equivalent at the year-end exchange rates. All exchange differences arising on settlement and conversion on foreign currency transaction are dealt with in profit and loss account, Investments in shares of foreign subsidiary companies are expressed in Indian currency at the rates of exchange prevailing at the time when the original investments were made.

XI. Accounting For Taxes On Income:

The provision for current income tax and fringe benefit tax has been made in accordance with the Income Tax Law prevailing for the relevant assessment year after considering various admissible reliefs.

Deferred tax for the year is recognised, on timing differences being the difference between the taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

Deferred tax asset and liabilities are measured using the tax rates and tax rules that have been enacted or substantively enacted by the Balance Sheet date. Deferred taxassetare recognized and carried forward only if there is reasonable/virtual certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realisation.

XII. Expenditure During Construction And On New Projects:

In case of new Industrial units and substantial expansion of existing units, all pre- operating expenditure specifically for the project, incurred up to the date of installation, is capitalised and added pro rata to the cost of fixed assets.

XIII. Provisions, Contingent Liabilities and Contingent Assets:

A provision is made based on reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed byway of notes to accounts. Contingent Assets are not recognised or disclosed in the financial statements.


Mar 31, 2001

The fiancial statements are prepared under historical cost.

A-1, FIXED ASSETS

Fixed Assets are stated at cost net of accumulated depreciation. Assets acquired on Hire purchase is capitaiised to the extent of Principal Value.

A-2. DEPRECIATION

Depreciation on Fixed Assets has been provided on written down value and manner provided in schedule XIV of Companies Act 1956. Addition during the Year are depreciated on prorata. Leasehold land is shown at cost and no written off are made in respect thereof.

A-3. INVESTMENT

Investment are stated at cost of acquisition.

A-4. INVENTORIES

Raw Materials are valued at cost.

Finished Goods are valued at lower of cost or market value.

Packing material, stores and spares are charged to Revenue.

A-5. SUNDRY DEBTORS AND ADVANCES

These are stated after making provision for doubtful debts and advances.

A-6. INTER DIVISIONAL TRANSFERS

interdivisional transfers of goods for internal use are shown as contra items in the Profit and Joss, account-to reflect the true Economic value of production inter-se the division. This Accounting treatment has no impact on the profit of the company.

A-7. SALES

Sales represent the invoice value of goods Excise Duty and Service supplied by the Company net off sales tax and j other charges such as freight.insurance and other incidental charges. j

A-8. RECOGNITION OF INCOME AND EXPENDITURE

income and expenditure are recognized and accounted on accrual basis. It is recognized oniy when it is reasonably | certain that the ultimate collection/payment will be made.

A-9. DIFFERED REVENUE EXPENDITURE

Preliminary Expenses and Shares Issue Expenses are amortisised over a period of 10 years.

A-10. EXCISE DUTY

I Liability for Excise Duty on Finished goods is Accounted as and when they are cleared from the factory premises

A-11. RETIREMENT BENEFITS

The liability for retirement benefits including Gratuity and leave encashment in respect of Employees is accounted for, on cash basis.

A-12. MODVAT CREDIT UTILISES:

Modvat credit utilised during the year is accounted and the unutilised Modvat Balance at the year end is considered as Advance Excise Duty.

A-13. FOREIGN EXCHANGE TRANSACTION

Foreign exchange Tranaction Liability related to foreign Currencies remaining unsettled at the end of the year are translated at contract rate. Realised gain/loss on foreign exchange tranaction other than relatsd to fixed Assets are recorded in the Profit and Loss Account.

A-14. TAXATION

The provison for taxation has been made in accordance with the Income Tax Law prevailing for the relevant assessment year after considering various admissible reliefs.

A-15. CONTINGENT LIABILITY

No provision is made for liability which are contingent in nature but if materials, the same is disclosed by way of ntes to the accounts.

A-16. INTEREST ON CALL MONEY

Interest on call money is accounted on receipt basis. A-17. OTHER ACCOUNTING POLICIES

These are consistent with the generally accepted accounting pretices.

 
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