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Accounting Policies of Autolite (India) Ltd. Company

Mar 31, 2014

(i) BASIS OF PREPARATION:

These financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under section 211(3C) [Companies(Accounting Standards) Rules 2006 as amended] and the other relevant provisions of the companies Act 1956.

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 VI to the Companies Act, 1956.

(ii) TANGIBLE ASSETS

All tangible assets are stated in the Balance Sheet at Cost. The Company capitalizes all costs related to fixed assets acquisitions and installations.

(iii) INTANGIBLE ASSETS

Business Application Software intended for Long Term use is recorded at acquisition cost. These software''s are amortized over their estimated useful life of 30 months.

(iv) DEPRECIATION

(a) Depreciation is provided as per rates specified in Schedule XIV of the Companies Act, 1956 on straight line method for 100% EOU Unit, Bulb & Capsule Division, Dies & Moulds Division & Machine Building Division and written down value method for Head Lamp Division on single shift basis.

(b) Depreciation is provided on pro-rata basis from the month in which assets come into operation and depreciation for the month of sale is ignored.

(c) No depreciation is provided on Freehold Land, Lease hold land and Well.

(v) INVENTORIES

(a) Raw Material, Stores & Spares, Work in Process are valued at landed cost or net realizable value, whichever is lower

(b) Finished goods are valued at Cost or Net realizable value, whichever is lower.

(c) The cost of imported Raw Material includes custom duties and other direct expenditure.

(d) Inventories have been valued on first in first out basis.

(vi) FOREIGN EXCHANGE TRANSACTION

(a) Export sales are accounted for at the actual rates prevailing at the time of negotiation of Bills. Those bills which are not negotiated are accounted for at the rates prevailing on Balance Sheet date.

(b) Expenditure in Foreign Currency is accounted for at the rates prevailing on the date of transaction.

(c) Cost of Imported material is converted to Indian Currency at the rate prevailing on the date of debiting such transaction by the Bank.

(d) Current Assets and Current Liabilities are accounted for at the rates prevailing as at the Balance sheet date.

(vii) REVENUE RECOGNITION Local Sales:

Sales are inclusive of Excise Duty but exclusive of Sales Tax and Trade Discount. Sales is inclusive of inter-unit transfer which is Rs. 1191.39 Lacs. (Rs.1270.66 Lacs)

Export Sales:

Export Sales are inclusive of Freight & Insurance wherever the terms are of CIF/C&F basis.

Export Sales are accounted on the date of removal of goods from Factory.

Other Income:

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

Income from duty drawback and Export

incentives are recognized on accrual basis.

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

(viii) DEFERRED REVENUE EXPENDITURE

Expenditure in respect of New Export Market Development through participation in ''Foreign Trade Fair'', New Product Development and Technical Know how are treated as deferred revenue expenditure and are amortized in subsequent five years.

(ix) EMPLOYEE BENEFITS

(1) The Company has Defined Contribution Plan for its Employees Retirement Benefits comprising of Provident Fund and Employees State Insurance Fund. The Company and eligible employees make monthly contribution to the above mentioned funds at a specified percentage of the covered employee''s salary. The Company recognizes its contributions as expenses of the year in which the liability is incurred.

(2) The Company has Defined Benefit Plan comprising of Gratuity Fund and Leave Encashment. The liability for Gratuity and Leave Encashment is determined on the basis of independent actuarial valuation done at year end. There are no Plan Assets in respect of the above as both are non-funded.

(3) Group Accident Policy

The Company has taken a policy from The National Insurance Co.Ltd. To cover those employees which are not covered in E.S.I.C Act. Premium paid/payable during the year is charged to Profit and Loss Account.

(x) INVESTMENTS

Investments are valued at cost. Provision for diminution in the value of long term investments is made, only if such decline is other than temporary.

(xi) TAXATION

Income tax expenses comprise current tax and deferred tax charge or credit. Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted by the balance sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws are recognized, only if there is a virtual certainty of its realization supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized, only to the extent there is a reasonable certainty of its realizations. At each Balance Sheet date, the carrying amount of deferred tax assets is to be reviewed to reassure realization.

(xii) LEASE TRANSACTION

For assets taken on operating lease, lease rentals payable are charged to revenue.

(xiii) BORROWING COSTS

Borrowing cost on working capital is charged against the Profit/Loss for the year in which it is incurred. Borrowing cost that is attributable to the construction/acquisition of fixed assets are capitalized as part of the cost of these capitalized assets till the date of completion of physical construction/ mechanical completion of the assets.

(xiv) IMPAIRMENT OF ASSETS

The carrying amount of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/ external factors. An Asset is treated as impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

(xv) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSESTS

The Company recognizes a provision where 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. Contingent assets are neither recognized nor disclosed. Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date

(xvi) CASH AND CASH EQUIVALENTS

In the cash flow statement, cash and cash equivalents includes cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.


Mar 31, 2013

(i) BASIS OF PREPARATION:

These financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under section 211(3C) [Companies(Accounting Standards) Rules 2006 as amended] and the other relevant provisions of the companies Act 1956. 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 VI to the Companies Act, 1956.

(ii) TANGIBLE ASSETS

All tangible assets are stated in the Balance

Sheet at Cost. The Company capitalizes all costs related to fixed assets acquisitions and installations.

(iii) INTANGIBLE ASSETS

Business Application Software intended for Long Term use is recorded at acquisition cost. These software''s are amortized over their estimated useful life of 30 months.

(iv) DEPRECIATION

(a) Depreciation is provided as per rates specified in Schedule XIV of the Companies Act, 1956 on straight line method for 100% EOU Unit, Bulb & Capsule Division, Dies & Moulds Division & Machine Building Division and written down value method for Head Lamp Division on single shift basis.

(b) Depreciation is provided on pro-rata basis from the month in which assets come into operation and depreciation for the month of sale is ignored.

(c) No depreciation is provided on Freehold Land, Lease hold land and Well.

(v) INVENTORIES

(a) Raw Material, Stores & Spares, Work in Process are valued at landed cost or net realizable value, whichever is lower

(b) Finished goods are valued at Cost or Net realizable value, whichever is lower.

(c) The cost of imported Raw Material includes custom duties and other direct expenditure.

(d) Inventories have been valued on first in first out basis.

(vi) FOREIGN EXCHANGE TRANSACTION

(a) Export sales are accounted for at the actual rates prevailing at the time of negotiation of Bills. Those bills which are not negotiated are accounted for at the rates prevailing on Balance Sheet date.

(b) Expenditure in Foreign Currency is accounted for at the rates prevailing on the date of transaction.

(c) Cost of Imported material is converted to Indian Currency at the rate prevailing on the date of debiting such transaction by the Bank.

(d) Current Assets and Current Liabilities are accounted for at the rates prevailing as at the Balance sheet date.

(vii) REVENUE RECOGNITION

Local Sales:

Sales are inclusive of Excise Duty but exclusive of Sales Tax and Trade Discount. Sales is inclusive of inter-unit transfer which is Rs. 1270.66 Lacs. (Rs.1878.39 Lacs)

Export Sales:

Export Sales are inclusive of Freight & Insurance wherever the terms are of CIF/ C&F basis. Export Sales are accounted on the date of removal of goods from Factory.

Other Income:

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

Income from duty drawback and Export incentives are recognized on accrual basis.

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

(viii) DEFERRED REVENUE EXPENDITURE

Expenditure in respect of New Export Market Development through participation in ''Foreign Trade Fair'', New Product Development and Technical Know how are treated as deferred revenue expenditure and are amortized in subsequent five years.

(ix) EMPLOYEE BENEFITS

(1) The Company has Defined Contribution Plan for its Employees Retirement Benefits comprising of Provident Fund and Employees State Insurance Fund. The Company and eligible employees make monthly contribution to the above mentioned funds at a specified percentage of the covered employee''s salary. The Company recognizes its contributions as expenses of the year in which the liability is incurred.

(2) The Company has Defined Benefit Plan comprising of Gratuity Fund and Leave Encashment. The liability for Gratuity and Leave Encashment is determined on the basis of independent actuarial valuation done at year end. There are no Plan Assets in respect of the above as both are non- funded.

(3) Group Accident Policy

The Company has taken a policy from The National Insurance Co.Ltd. To cover those employees which are not covered in E.S.I.C Act. Premium paid/payable during the year is charged to Profit and Loss Account.

(x) INVESTMENTS

Investments are valued at cost. Provision for diminution in the value of long term investments is made, only if such decline is other than temporary.

(xi) TAXATION

Income tax expenses comprise current tax and deferred tax charge or credit. Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted by the balance sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws are recognized, only if there is a virtual certainty of its realization supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized, only to the extent there is a reasonable certainty of its realizations. At each Balance Sheet date, the carrying amount of deferred tax assets is to be reviewed to reassure realization.

(xii) LEASE TRANSACTION

For assets taken on operating lease, lease rentals payable are charged to revenue.

(xiii) BORROWING COSTS

Borrowing cost on working capital is charged against the Profit/Loss for the year in which it is incurred. Borrowing cost that is attributable to the construction/ acquisition of fixed assets are capitalized as part of the cost of these capitalized assets till the date of completion of physical construction/mechanical completion of the assets.

(xiv) IMPAIRMENT OF ASSETS

The carrying amount of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/ external factors. An Asset is treated as impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

(xv) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSESTS

The Company recognizes a provision where 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. Contingent assets are neither recognized nor disclosed. Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date

(xvi) CASH AND CASH EQUIVALENTS

In the cash flow statement, cash and cash equivalents includes cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.


Mar 31, 2012

(i) BASIS OF PREPARATION:

These financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under section 211(3C) [Companies(Accounting Standards) Rules 2006 as amended] and the other relevant provisions of the companies Act 1956.

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 VI to the Companies Act, 1956.

(ii) TANGIBLE ASSETS

All tangible assets are stated in the Balance Sheet at Cost. The Company capitalizes all costs related to fixed assets acquisitions and installations.

(iii) INTANGIBLE ASSETS

Business Application Software intended for Long Term use is recorded at acquisition cost. These software's are amortized over their estimated useful life of 30 months.

(iv) DEPRECIATION

(a) Depreciation is provided as per rates specified in Schedule XIV of the Companies Act, 1956 on straight line method for 100% EOU Unit, Bulb & Capsule Division, Dies & Moulds Division & Machine Building Division and written down value method for Head Lamp Division on single shift basis.

(b) Depreciation is provided on pro-rata basis from the month in which assets come into operation and depreciation for the month of sale is ignored.

(c) No depreciation is provided on Freehold Land, Lease hold land and Well.

(v) INVENTORIES

(a) Raw Material, Stores & Spares, Work in Process are valued at landed cost or net realizable value, whichever is lower

(b) Finished goods are valued at Cost or Net realizable value, whichever is lower.

(c) The cost of imported Raw Material includes custom duties and other direct expenditure.

(d) Inventories have been valued on first in first out basis.

(vi) FOREIGN EXCHANGE TRANSACTION

(a) Export sales are accounted for at the actual rates prevailing at the time of negotiation of Bills. Those bills which are not negotiated are accounted for at the rates prevailing on Balance Sheet date.

(b) Expenditure in Foreign Currency is accounted for at the rates prevailing on the date of transaction.

(c) Cost of Imported material is converted to Indian Currency at the rate prevailing on the date of debiting such transaction by the Bank.

(d) Current Assets and Current Liabilities are accounted for at the rates prevailing as at the Balance sheet date.

(vii) REVENUE RECOGNITION

Local Sales :

Sales are inclusive of Excise Duty but exclusive of Sales Tax and Trade Discount. Sales is inclusive of inter-unit transfer which is Rs. 1878.39 Lacs. (1817.98 Lacs)

Export Sales :

Export Sales are inclusive of Freight & Insurance wherever the terms are of CIF/ C&F basis. Export Sales are accounted on the date of removal of goods from Factory.

Other Income:

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

Income from duty drawback and Export incentives are recognized on an accrual basis.

Dividend income is recognized when the

right to receive dividend is established.

(viii) DEFERRED REVENUE EXPENDITURE

Expenditure in respect of New Export Market Development through participation in 'Foreign Trade Fair', New Product Development and Technical Know how are treated as deferred revenue expenditure and are amortized in subsequent five years.

(ix) EMPLOYEE BENEFITS

(1) The Company has Defined Contribution Plan for its Employees Retirement Benefits comprising of Provident Fund and Employees State Insurance Fund. The Company and eligible employees make monthly contribution to the above mentioned funds at a specified percentage of the covered employees salary. The Company recognizes its contributions as expenses of the year in which the liability is incurred.

(2) The Company has Defined Benefit Plan comprising of Gratuity Fund and Leave Encashment. The liability for Gratuity and Leave Encashment is determined on the basis of independent actuarial valuation done at year end. There are no Plan Assets in respect of the above as both are non-funded.

(3) Group Accident Policy

The Company has taken a policy from The New India Assurance Co.Ltd. to cover those employees which are not covered in E.S.I.C Act. Premium paid/payable during the year is charged to Profit and Loss Account.

(x) INVESTMENTS

Investments are valued at cost. Provision for diminution in the value of long term investments is made, only if such decline is other than temporary.

(xi) TAXATION

Income tax expenses comprise current tax and deferred tax charge or credit. Provision for current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted by the balance sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws are recognized, only if there is a virtual certainty of its realization supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized, only to the extent there is a reasonable certainty of its realizations. At each Balance Sheet date, the carrying amount of deferred tax assets is to be reviewed to reassure realization.

(xii) LEASE TRANSACTION

For assets taken on operating lease, lease rentals payable are charged to revenue.

(xiii) BORROWING COSTS

Borrowing cost on working capital is charged against the Profit/Loss for the year in which it is incurred. Borrowing cost that is attributable to the construction/ acquisition of fixed assets are capitalized as part of the cost of these capitalized assets till the date of completion of physical construction/mechanical completion of the assets.

(xiv) IMPAIRMENT OF ASSETS

The carrying amount of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An Asset is treated as impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

(xv) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSESTS

The Company recognizes a provision where 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. Contingent assets are neither recognized nor disclosed. Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date

(xvi) CASH AND CASH EQUIVALENTS

In the cash flow statement, cash and cash equivalents includes cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.


Mar 31, 2010

(i) FIXED ASSETS

All fixed assets are stated in the Balance Sheet at Cost. The Company capitalizes all costs related to fixed assets acquisitions and installations.

(ii) DEPRECIATION

(a) Depreciation is provided as per rates specified in Schedule XIV of the Companies Act, 1956 on straight line method for 100% EOU Unit, Bulb & Capsule Division, Dies & Moulds Division, Machine Building Division & Glass project and written down value method for Head Lamp Division on single shift basis.

(b) In respect of Glass project, the company has provided depreciation from March 2001 due to reduction in the useful life of assets by effluxion of time, though the commercial production has been started in 2008-09. ¦

(c) Depreciation is provided on pro-rata basis from the month in which assets come into operation and depreciation for the month of sale is ignored.

(d) No depreciation is provided on Freehold Land, Lease hold land and Well.

(iii) INVENTORIES

(a) Raw Material, Stores, Spares, Work in Process are valued at landed cost or net realizable value, whichever is lower.

(b) Finished goods are valued at Cost or Net realizable value, whichever is lower.

(c) The cost of imported Raw Material includes custom duties and other direct expenditure.

(d) Inventories have been valued on the basis of FIFO method.

(iv) FOREIGN EXCHANGE

TRANSACTION

(a) Export sales are accounted for at the actual rates prevailing at the time of negotiation of Bills. Those bills which are not negotiated are accounted for at the rates prevailing on Balance Sheet date.

(b) Expenditure in Foreign Currency is accounted for at the rate prevailing on the date of transaction.

(c) Cost of Imported material is converted to Indian Currency at the rate prevailing on the date of debiting such transaction by the Bank.

(d) Current Assets and Current Liabilities are accounted for at the rates prevailing as at the Balance sheet date.

(v) SALES

Local Sales:

Sales are inclusive of Excise Duty but exclusive of Sales Tax and Trade Discount. Sales is inclusive of inter-unit transfer which isRs. 1985.41 Lacs. (Rs. 1419.44 Lacs)

Export Sales:

Export Sales are inclusive of Freight & Insurance wherever the terms are of CDEVC&F basis. Export Sales are accounted on the date of removal of goods from Factory.



(vi) DEFERRED REVENUE EXPENDITURE

Expenditure in respect of New Export Market Development through participation in Foreign Trade Fair and New Product Development are treated as deferred revenue expenditure and are amortized in subsequent five years.

(vii) EMPLOYEE BENEFITS

(1) The Company has Defined Contribution Plan for its Employees Retirement Benefits comprising of Provident Fund and Employees State Insurance Fund. The Company and eligible employees make monthly contribution to the above mentioned funds at a specified percentage of the covered employees salary. The Company recognizes its contributions as expenses of the year in which the liability is incurred.

(2) The Company has Defined Benefit Plan comprising of Gratuity Fund and Leave Encashment. The liability for Gratuity and Leave Encashment is determined on the basis of independent actuarial valuation done at year end. There are no Plan Assets in respect of the above as both are non-funded.

(3) Group Accident Policy

The Company has taken a policy from The New Inida Assurance Co.Ltd. to cover those employees which are not covered in E.S.I.C Act. Premium paid/payable during the year is charged to Profit and Loss Account.

(viii) BASIS OF ACCOUNTING

The Company has prepared Accounts on a going concern basis and follows the mercantile system of accounting generally.

(ix) CAPITAL WORK IN PROGRESS

Cost of fixed assets yet to come into operation and other direct and indirect expenditure related to such assets are treat as capital work in progress.

(x) INVESTMENTS

Investments are valued at cost. Provision fi diminution in the value of long ten investments is made, only if such decline : other than temporary.

(xi) TAXATION

Income tax expenses comprise current tax am deferred tax charge or credit. Provision foi current tax is made on the assessable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted by the balance sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws are recognized, only if there is a virtual certainty of its realization supported by J. convincing evidence. Deferred tax assets on account of other timing differences are recognized, only to the extent there is a reasonable certainty of its realizations. At each Balance Sheet date, the carrying amount of deferred tax assets is to be reviewed to reassure realization.

(xii) LEASE TRANSACTION

For assets taken on operating lease, lease rentals payable are charged to revenue.

(xiii) BORROWING COSTS

Borrowing cost on working capital is charged against the Profit/Loss for the year in which it is incurred. Borrowing cost that is attributable to the construction/acquisition of fixed assets are capitalized as part of the cost of these capitalized assets till the date of completion of physical construction/ mechanical completion of the assets.

(xiv)IMPAIRMENT OF ASSETS

The carrying amount of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/ external factors. An Asset is treated as impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

(xv) INTANGIBLE ASSETS

Business Application Software intended for Long Term use is recorded at acquisition cost. These softwares are amortized over their estimated useful life of 30 months.

(xvi) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSESTS

The Company recognizes a provision where 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. Contingent assets are neither recognized nor disclosed. Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date

 
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