Accounting Policies of Ashirwad Steels & Industries Ltd. Company

Mar 31, 2015

(i) Basis of accounting :

(a) The Company prepares its accounts under historical cost convention and on accrual basis except otherwise stated, in accordance with the normally accepted accounting principles including the mandatory Accounting Standards specified under section 133 of the Companies Act,2013 read with rule 7 of the Companies (Accounts) Rules,2014.

(b) Revenue from sale of goods is recognized on passage of title to the customers, which generally coincides with delivery. Revenue from services rendered is recognized on rendering of services to the customers.

(c) Bonus including ex-gratia payable and leave salary payable to the employees, as per consistent practice, are accounted for on cash basis.

(d) Dividend on Investments in shares and refunds of excise and other levies/taxes are accounted for on acceptance/actual receipt basis.

(ii) Fixed Assets:

Fixed Assets are stated at cost of acquisition net of cenvat and inclusive of freight, duties, and cost of finance during construction period and expenses related to acquisition, installation, erection and commissioning.

(iii) Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Investments are carried and valued at cost. Decline in market value other then temporary and the resultant reduction in the value of investment is recognized and charged to Profit & Loss Account as per AS- 13.Profit or loss if any on the disposal/sale of investments are accounted for in the Profit & Loss Account.

(iv) Depreciation:

(a) Depreciation on fixed assets has been provided for on the straight-line method considering the useful lives of the respective asset as prescribed in Schedule II to the Companies Act,2013.

(b) The residual value of the depreciable asset is taken as 5% of its original cost for arriving at the depreciable portion of each fixed asset.

(c) In those cases where the remaining useful life of an asset has exhausted the carrying amount of such asset (WDV) as on 01.04.14 has been charged as transitional provision for depreciation under the Extraordinary item in the Profit & Loss Account.

(d) Depreciation includes amount written off in respect of leasehold properties over the respective lease period.

(v) Valuation of Inventories:

Inventories are valued as under:

Raw Materials At lower of cost or net realizable value.

Finished goods At lower of cost (including Excise Duty) or net realizable value.

Work-in-Progress At lower of cost or net realizable value.

Cost includes direct materials, labour cost and manufacturing overheads based on normal operating capacity

Stores & Spares At lower of cost or net realizable value.

Wastes & Others At net realizable value.

The cost of inventories comprises of all costs of purchase, Freight, Taxes & Duties costs of conversion and other cost directly attributable to the acquisition thereof. For arriving at the cost of inventories, the FIFO cost formula along with the retail method for measurement of cost has been adopted.

(vi) Retirement Benefits and other Employee Benefits:

a. Company''s contributions to Provident Fund and Employees State Insurance Fund are charged to the Profit & Loss Account of the year when the contributions to the respective funds are due.

b. Provision is made for the liability on account of Gratuity payable to employees.

(vii) Sales:

Sales excludes VAT & CST ,includes excise duty and it is shown net of sales returns.

(viii) Other Income:

Interest income on Fixed Deposits is accounted for on accrual basis. Dividend and other interest income are accounted for as and when received.

(ix) Excise Duty:

Excise Duty is accounted for at the point of manufacture of goods and accordingly is considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

(x) Contingent Liabilities:

Contingent Liabilities that are not provided for are disclosed by way of Notes to the Accounts.

(xi) Income tax:

Provision for Tax comprises of both current and deferred taxes. Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reversal of timing differences of earlier years, subject to consideration of prudence. Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted on the Balance Sheet date.

(xii) Borrowing costs:

The borrowing costs other than relating to the acquisition / construction of assets are recognised as an expense in the financial accounts.

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Mar 31, 2014

(i) Basis of accounting:

(a) The Company prepares its accounts under historical cost convention and on accrual basis except otherwise stated, in accordance with the normally accepted accounting principles.

(b) Revenue from sale of goods is recognized on passage of title to the customers, which generally coincides with delivery. Revenue from services rendered is recognized on rendering of services to the customers.

(c) Bonus including ex-gratia payable and leave salary payable to the employees, as per consistent practice, are accounted for on cash basis.

(d) Dividend on Investments in shares and refunds of excise and other levies/taxes are accounted for on acceptance/actual receipt basis.

(ii) Fixed Assets:

Fixed Assets are stated at cost of acquisition net of cenvat and inclusive of freight, duties, and cost of finance during construction period and expenses related to acquisition, installation, erection and commissioning.

(iii) Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Investments are carried and valued at cost. Profit or loss if any on the same are accounted for upon their disposal/Sale.

(iv) Depreciation:

(a) Depreciation on fixed assets has been provided for on the straight-line method at the rates and in the manner prescribed under schedule XIV of the Companies Act, 1956.

(b) Depreciation on fixed assets added during the year is provided on Pro-rata with reference to the month of addition/deletion, except for assets costing Rs. 5,000/- or less on which 100% depreciation is provided.

(c) Depreciation includes amount written off in respect of leasehold properties over the respective lease period.

(v) Valuation of Inventories:

Inventories are valued as under:

Raw Materials At lower of cost or net realizable value.

Finished goods At lower of cost (including Excise Duty) or net realizable value.

Work-in-Progress At lower of cost or net realizable value.

Cost includes direct materials, labour cost and manufacturing overheads based on normal operating capacity

Stores & Spares At lower of cost or net realizable value.

Wastes & Others At net realizable value.

The cost of inventories comprises of all costs of purchase, Freight, Taxes & Duties costs of conversion and other cost directly attributable to the acquisition thereof. For arriving at the cost of inventories, the FIFO cost formula along with the retail method for measurement of cost has been adopted.

(vi) Retirement Benefits and other Employee Benefits:

a. Company''s contributions to Provident Fund and Employees State Insurance Fund are charged to the Profit & Loss Account of the year when the contributions to the respective funds are due.

b. Provision has been made for the liability on account of Gratuity payable to employees, which is at present the unfunded plan of the company.

(vii) Sales:

Sales excludes VAT & CST, includes excise duty and it is shown net of sales returns.

(viii) Other Income:

Interest income on Fixed Deposits is accounted for on accrual basis. Dividend and other interest income are accounted for as and when received.

(ix) Excise Duty:

Excise Duty is accounted for at the point of manufacture of goods and accordingly is considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

(x) Contingent Liabilities:

Contingent Liabilities that are not provided for have been disclosed by way of Notes to the Accounts.

(xi) Income tax:

Provision for Tax comprises of both current and deferred taxes. Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reversal of timing differences of earlier years, subject to consideration of prudence. Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted on the Balance Sheet date.

(xii) Borrowing costs:

The borrowing costs other than relating to the acquisition/construction of assets are recognised as an expense in the financial accounts.

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Mar 31, 2013

(i) Basis of accounting :

(a) The Company prepares its accounts under historical cost convention and on accrual basis except otherwise stated, in accordance with the normally accepted accounting principles.

(b) Revenue from sale of goods is recognized on passage of title to the customers, which generally coincides with delivery. Revenue from services rendered is recognized on rendering of services to the customers.

(c) Bonus including ex-gratia payable and leave salary payable to the employees, as per consistent practice, are accounted for on cash basis.

(d) Dividend on Investments in shares and refunds of excise and other levies/taxes are accounted for on acceptance/actual receipt basis.

(ii) Fixed Assets:

Fixed Assets are stated at cost of acquisition net of canvas and inclusive of freight, duties and cost of finance during construction period and expenses related to acquisition, installation, erection and commissioning.

(iii) Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Investments are carried and valued at cost. Profit or loss if any on the same are accounted for upon their disposal/sale.

(iv) Depreciation:

(a) Depreciation on fixed assets has been provided for on the straight-line method at the rates and in the manner prescribed under schedule XIV of the Companies Act, 1956.

(b) Depreciation on fixed assets added during the year is provided on Pro-rata with reference to the month of addition/deletion, except for assets costing Rs.5, 000/- or less on which 100% depreciation is provided.

(c) Depreciation includes amount written off in respect of leasehold properties over the respective lease period.

(v) Valuation of Inventories.

Inventories are valued as under:

Raw Materials At lower of cost or net realizable value.

Finished goods At lower of cost (including Excise Duty) or net realizable value.

Work-in-Progress At lower of cost or net realizable value.

Cost includes direct materials, labour cost and manufacturing overheads based on normal operating capacity

Stores & Spares At lower of cost or net realizable value.

Wastes & Others At net realizable value.

The cost of inventories comprises of all costs of purchase, freight, taxes & duties costs of conversion and other cost directly attributable to the acquisition thereof. For arriving at the cost of inventories, the FIFO cost formula along with the retail method for measurement of cost has been adopted.

(vi) Retirement Benefits and other Employee Benefits:

a. Company''s contributions to Provident Fund and Employees State Insurance Fund are charged to the Profit & Loss Account of the year when the contributions to the respective funds are due.

b. Provision has been made for the liability on account of Gratuity payable to employees, which is at present the unfunded plan of the company.

(vii) Sales:

Sales are inclusive of VAT and excise duty and shown net of sales returns.

(viii) Other Income:

Interest income-on Fixed Deposits is accounted for on accrual basis. Dividend and other interest income are accounted for as and when received.

(ix) Excise Duty:

Excise Duty is accounted for at the point of manufacture of goods and accordingly is considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

(x) Contingent Liabilities:

Contingent Liabilities that are not provided for have been disclosed by way of Notes to the Accounts.

(xi) Income tax:

Provision for Tax comprises of both current and deferred taxes. Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reversal of timing differences of earlier years, subject to consideration of prudence. Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted on the Balance Sheet date.

(xii) Borrowing costs:

The borrowing costs other than relating to the acquisition / construction of assets are recognized as an expense in the financial accounts.

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Mar 31, 2010

(i) Basis of accounting

(a) The Company prepares its accounts under historical cost convention and on accrual basis except otherwise stated, in accordance with the normally accepted accounting principles.

(b) Revenue from sale of goods is recognized on passage of title to the customers, which generally coincides with delivery. Revenue from services rendered is recognized on rendering of services to the customers.

(c) Bonus including ex-gratia payable and leave salary payable to the employees, as per consistent practice, are accounted for on cash basis.

(d) Dividend on Investments in shares and refunds of excise and other levies/taxes are accounted for on acceptance/actual receipt basis.

(ii) Fixed Assets:

Fixed Assets are stated at cost of acquisition net of cenvat and inclusive of freight, duties, and cost of finance during construction period and expenses related to acquisition, installation, erection and commissioning.

(iii) Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Investments are carried and valued at cost. Profit or loss if any on the same are accounted for upon their disposal/Sale.

(iv) Depreciation:

(a) Depreciation on fixed assets has been provided for on the straight-line method at the rates and in the manner prescribed, under schedule XIV of the Companies Act, 1956.

(b) Depreciation on fixed assets added during the year is provided on Pro-rata with reference to the month of addition/deletion, except for assets costing Rs.5, 000/- or less on which 100% depreciation is provided.

(c) Depreciation includes amount written off in respect of leasehold properties over the respective lease period.

(v) Valuation of Inventories:

Inventories are valued as under:

Raw Materials At lower of cost or net realizable value.

Finished goods At lower of cost (including Excise Duty) or net realizable value.

Work-in-Progress At lower of cost or net realizable value. Cost includes direct materials, labour cost and manufacturing overheads based on normal operating capacity

Stores & Spares At lower of cost or net realizable value.

Wastes & Others At net realizable value.

The cost of inventories comprises of all costs of purchase, Freight, Taxes & Duties costs of conversion and other cost directly attributable to the acquisition thereof. For arriving at the cost of inventories, the FIFO cost formula along with the retail method for measurement of cost has been adopted.

(vi) Retirement Benefits and other Employee Benefits:

a. Companys contributions to Provident Fund and Employees State Insurance Fund are charged to the Profit & Loss Account of the year when the contributions to the respective funds are due.

b. Provision has been made for the liability on account of Gratuity payable to employees, which is unfunded . plan of the company.

(vii) Sales:

Sales are inclusive of sales tax and excise duty and shown net of sales returns.

(viii) Other Income:

Interest income on Fixed Deposits is accounted for on accrual basis. Dividend and other interest income are accounted for as and when received.

(ix) Excise Duty:

Excise Duty is accounted for at the point of manufacture of goods and accordingly is considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

(x) Contingent Liabilities:

Contingent Liabilities that are not provided for have been disclosed by way of Notes to the Accounts.

(xi). Income tax:

Provision for Tax comprises of both current and deferred taxes. Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reversal of timing differences of earlier years, subject to consideration of prudence. Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted on the Balance Sheet date.

(xii) Borrowing costs :

The borrowing costs other than relating to the acquisition / construction of assets are recognised as an expense in the financial accounts.

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Mar 31, 2009

(i) Basis of accounting

(a) The Company prepares its accounts under historical cost convention and on accrual basis except otherwise stated, in accordance with the normally accepted accounting principles.

(b) Revenue from sale of goods is recognized on passage of title to the customers, which generally coincides with delivery. Revenue from services rendered is recognized on rendering of services to the customers.

(c) Bonus including ex-gratia payable and leave salary payable to the employees, as per consistent practice, are accounted for on cash basis.

(d) Dividend on Investments in shares and refunds of excise and other levies/taxes are accounted for on acceptance/actual receipt basis.

(ii) Fixed Assets:

Fixed Assets are stated at cost of acquisition net of cenvat and inclusive of freight, duties, and cost of finance during construction period and expenses related to acquisition, installation, erection and commissioning.

(iii) Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Investments are carried and valued at cost. Profit or loss if any on the same are accounted for upon their disposal/Sale.

(iv) Depreciation:

(a) Depreciation on fixed assets has been provided for on the straight-line method at the rates and in the manner prescribed under schedule XIV of the Companies Act, 1956.

(b) Depreciation on fixed assets added during the year is provided on Pro-rata with reference to the month of addition/deletion, except for assets costing Rs.5,000/- or less on which 100% depreciation is provided.

(c) Depreciation includes amount written off in respect of leasehold properties over the respective lease period.

(v) Valuation of Inventories:

Inventories are valued as under:

Raw Materials At lower of cost or net realizable value.

Finished goods At lower of cost (including Excise Duty) or net realizable value.

Work-in-Progress At lower of cost or net realizable value.

Cost includes direct materials, labour cost and manufacturing overheads based on normal operating capacity Stores & Spares At lower of cost or net realizable value.

Wastes & Others At net realizable value.

The cost of inventories comprises of all costs of purchase, Freight, Taxes & Duties costs of conversion and other cost directly attributable to the acquisition thereof. For arriving at the cost of inventories, the FIFO cost formula along with the retail method for measurement of cost has been adopted.

(vi) Retirement Benefits and other Employee Benefits:

a. Companys contributions to Provident Fund and Employees State Insurance Fund are charged to the Profit & Loss Account of the year when the contributions to the respective funds are due.

b. Provision has been made for the liability on account of Gratuity payable to employees from the current financial year, which is unfunded plan of the company.

(vii) Sales:

Sales are inclusive of sales tax and excise duty and shown net of sales returns.

(viii) Other Income:

Interest income on Fixed Deposits is accounted for on accrual basis. Dividend and other interest income are accounted for as and when received.

(ix) Excise Duty:

Excise Duty is accounted for at the point of manufacture of goods and accordingly is considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

(x) Contingent Liabilities:

Contingent Liabilities that are not provided for have been disclosed by way of Notes to the Accounts.

(xi) Income tax:

Provision for Tax comprises of both current and deferred taxes. Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reversal of timing differences of earlier years, subject to consideration of prudence. Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted on the Balance Sheet date.

(xii) Borrowing costs :

The borrowing costs other than relating to the acquisition / construction of assets are recognised as an expense in the financial accounts.

Notes :

(i) The Company has disclosed Business Segments. Segments have been identified taking into account the nature of the product, uses and production system. The Companys operations predominantly relate to manufacturing of Sponge Iron. The quantum of operations relating to refilling/trading in LPG/RLH Gases is quite nominal.

(ii) The Company caters fully to the needs of the domestic market. The Export turnover of the Company is nil. As such there is no reportable geographical segments.

(iii) Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts allocated on a reasonable basis. The expenses, Assets and Liabilities that cannot be allocated between the segments are shown as unallocated expenses, Assets and Liabilities respectively.