Mar 31, 2015
CORPORATE INFORMATION
Autopal Industries Limited (APIL) incorporated as a public limited
company under the provision of Companies Act 1956. The present
directors and key management persons are Shri Dharam Pal Gupta, Anup
Gupta, Ratan Lal Rawat, Abhishek Gupta, Shailender Kumar and Anubha
Gupta.The company is in the production of LED's. Conservation of energy
is the need of the hour. Due to limited power resources, the burden of
cost on an average person is inflating day by day, which can be
addressed by using energy saving product viz. Light Emitting Diode(
LED). A trend of power efficient lightening equipments is following on.
Urban people are continuously using the LED as they are cost conscious
and understanding the benefits of energy efficient measures. The
Government started making publicity in semi-urban and rural areas
regarding the benefits of usage of LED over traditional incandescent
bulbs and it helps the industry to create new demand of the
products.The LED is very cost conscious and uses less energy than CFL.
The market of LED is on the boom in the current scenario.
A. Basis of Accounting & Preparation of Financial Statements
These financial statements of the Company are prepared in accordance
with Indian Generally Accepted Accounting Principles (GAAP) under the
historical cost convention on the accrual basis.GAAP comprises
mandatory accounting standards as prescribed under the relevant
provisions of the Companies Act, 2013 and guidelines issued by the
Securities and Exchange Board of India (SEBI). Accounting policies have
been consistently applied except where a newly issued accounting
standard is initially adopted or a revision to an existing accounting
standard requires a change in the accounting policy hitherto in use.
B. Use of Estimates
The preparation of the financial statements in conformity with Indian
GAAP requires management to make estimates and assumptions that affect
the reported balances of assets and liabilities and disclosures relating
to contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the period.
Accounting estimates could change from period to period. Actual results
could differ from those estimates. Appropriate changes in estimates are
made as the Management becomes aware of changes in circumstances
surrounding the estimates. Changes in estimates are reflected in the
financial statements in the period in which changes are made and, if
material, their effects are disclosed in the notes to the financial
statements.
C. Revenue Recognition
Revenue is primarily derived from manufacturing Light Emitting Diode
i.e.LED. Revenue part also comprises of income from trading of
Aluminium and CR Coil in Cut. The Income and Expenditure are accounted
on accrual basis, except dividend which is accounted for on receipt
basis.Revenue from sale of goods is recognized when all the significant
risks and rewards of ownership of the goods have been passed to the
buyer.
D. Tangible Assets
Fixed assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. Cost comprises
of all costs incurred to bring the assets to their location and working
condition and includes all expenses incurred up to the date of
commercial utilization.
Subsequent expenditure related to an item of fixed assets is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance.
All other expenses on existing fixed assets, including day-to-day
repair and maintenance expenditure and cost of replacing parts, are
charged to the statement of profit and loss for the period during which
such expenses are incurred.
Gain or losses arising from de-recognition of fixed assets are measured
as the difference between net disposal proceeds and the carrying amount
of the asset and are recognized in the statement of profit and loss
when the asset is derecognized.
E. Intangible Assets
Intangible assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. The cost of an
intangible asset comprises its purchase price including import duty and
other taxes (other than those subsequently recoverable from taxing
authorities), and any directly attributable expenditure on making the
asset ready for its intended use and net of any trade discounts and
rebates. Subsequent expenditure on an intangible assets after its
purchase/completion is recognized as an expense when incurred unless it
is probable that such expenditure will enable the asset to generate
future economic benefit in excess of its originally assessed standards
of performance and such expenditure can be measured and attributed to
the asset reliably, in which case such expenditure is added to the cost
of the asset.
F. Depreciation and Amortization
Depreciation on fixed assets is provided to the extent of Depreciable
amount on straight-line method. Depreciation is provided based on
useful life of the assets as prescribed in Schedule II to the Companies
Act, 2013.Salvage Value of the assets has been taken @5% of Original
Cost as prescribed in Schedule II except in respect of the following
assets:
Particulars Salvage Value (%)
Building 20%
Car 20%
The written down value of Fixed assets whose lives have expired as at
01st April 2014 have been adjusted in the opening balance of Reserves
and Surplus amounting to Rs. 38,01,023.
G. Retirement Benefits to Employees
a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, Gratuity has been
provided in the books of accounts on accrual basis by HR Department of
the company. Gratuity calculation is not made on the basis of Actuarial
Report as prescribed in AS-15 Employee Benefits. However, the gratuity
calculation is computed by the management based on assumption that such
benefits are payable to all eligible employees at the time of
retirement and superannuation.
b. Provident Fund/ESI
Company's contribution paid during the year to provident fund and ESIC
are charged to Profit & loss Account. There are no other obligations
other than contribution payable to the respective authorities.
Eligible employees receive benefits from a provident fund, which is a
defined benefit plan. Both the employee and the Company make monthly
contributions to the provident fund plan equal to a specified
percentage of the covered employee's salary.
c. Bonus
Bonus is eligible to employees on the maximum rate of 20% of Basic Pay
as per payment of Bonus Act, 1965 and to other employees at the rate of
8.33% on Basic Pay and shown as Ex-gratia. However payment has been
made to the employees till date in respect of previous accounting years
but the provision has been made in respect of current accounting
period.
H. Foreign Currency Transactions
Cost of imported raw material is converted to Indian currency at the
rate prevailing on the date of debiting such transaction by the bank as
prescribed in AS -11 Effects of Changes in Foreign Exchange Rates
issued by ICAI.
I. Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. However, materials and other items held
for use in the production of inventories are not written down below
cost if the finished products in which they will be incorporated are
expected to be sold at or above cost.
The stock of Work-in-progress is valued on estimated cost basis and
finished goods of the Business have been valued at the lower of cost
and net realizable value. The cost has been measured on the actual cost
basis and includes cost of materials, custom duty and cost of
conversion to its present location and conditions. All other
inventories of stores, consumables, raw materials are valued at landed
cost. The stock of waste is also valued at realizable value. Net
realizable value is the estimated selling price in the ordinary course
of business, less estimated costs of completion and estimated costs
necessary to make the sale. Stock - in- Transit is valued at cost.
J. Investments
Investments are classified as long term or current based on intention of
the management at the time of purchase. Investments are classified into
current and long-term investments.
On initial investment are measured at cost. The cost comprises purchase
price and directly attributable acquisition charges. Dividend
reinvested in case of mutual funds is added to the value of investment
in mutual funds with corresponding credit is made to the profit and
loss statement.
Current investments are carried in the financial statements at lower of
cost and fair value. Long- term investments are stated at cost. A
provision for diminution is made to recognize a decline, other than
temporary, in the value of long-term investments.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is charged or credited to the
statement of profit & loss.
The company has investments of Rs. 3000/- in NSC, Rs. 100/- in 10
Equity shares of Rs. 10 each of PalsoftInfo systems Limited and of Rs.
800000/- in GK Autopal Lighting Solutions LLP which are recorded at
cost in the books of accounts.
K. Cash Flow Statement
Cash flows are reported using the indirect method as prescribed by AS -
3 Cash Flow Statement, whereby profit before tax is adjusted for the
effects of transactions of a non-cash nature, any deferrals or accruals
of past or future operating cash receipts or payments and item of
income or expenses associated with investing or financing cash flows.
The cash flows from operating, investing and financing activities of
the company are segregate.
L. Taxation
Income tax payable comprises of 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 assets and deferred tax liability is calculated by applying tax rate
and tax laws that have been enacted by the balance sheet date as
prescribed by AS - 22 of ICAI.
M. Impairment of Assets
An asset is considered as impaired in accordance with Accounting
Standard 28 on Impairment of Assets when at balance sheet date there
are indications of impairment and the carrying amount of the asset, or
where applicable the cash generating unit to which the asset belongs,
exceeds its recoverable amount (i.e. the higher of the asset's net
selling price and value in use).
N. Provisions and Contingent Liabilities
A provision is recognized if, as a result of a past event, the company
has a present legal obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by the best estimate
of the outflow of economic benefits required to settle the obligation
at the reporting date. Where no reliable estimate can be made, a
disclosure is made as contingent liability. A disclosure for a
contingent liability is also 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 possible obligation or a present
obligation in respect of which the likelihood of outflow of resources
is remote, no provision or disclosure is made.
O. Prior Period Items
Prior period items which arise in the current period as a result of
'errors' or 'omissions' in the financial statements prepared in earlier
years effects of changes in estimates of which are not treated as
omission or error.
Mar 31, 2014
A) Basis of Accounting & Preparation of Financial Statements
These financial statements of the Company are prepared in accordance
with Indian Generally Accepted Accounting Principles (GAAP) under the
historical cost convention on the accrual basis. GAAP comprises
mandatory accounting standards as prescribed by the Companies
(Accounting Standards) Rules, 2006, the provisions of the Companies
Act, 1956 and guidelines issued by the Securities and Exchange Board of
India (SEBI). Accounting policies have been consistently applied except
where a newly issued accounting standard is initially adopted or a
revision to an existing accounting standard requires a change in the
accounting policy hitherto in use
B) Use of Estimate The preparation of the financial statements in
conformity with GAAP requires management to make estimates and
assumptions that affect the reported balances of assets and liabilities
and disclosures relating to contingent liabilities as at the date of
the financial statements and reported amounts of income and expenses
during the period.
Accounting estimates could change from period to period.
Actual results could differ from those estimates. Appropriate changes
in estimates are made as the Management becomes aware of changes in
circumstances surrounding the estimates. Changes in estimates are
reflected in the financial statements in the period in which changes
are made and, if material, their effects are disclosed in the notes to
the financial statements.
C) Revenue Recognition
Revenue is primarily derived from manufacturing Light Emitting Diode
i.e. LED. Revenue part also comprises of income from trading of LED and
CR Coil in Cut. The Income and Expenditure are accounted on accrual
basis, except dividend which is accounted for on receipt basis. Revenue
from sale of goods is recognized when all the significant risks and
rewards of ownership of the goods have been passed to the buyer.
D) Tangible Assets
Fixed assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. Cost comprises
of all costs incurred to bring the assets to their location and working
condition and includes all expenses incurred up to the date of
commercial utilization.
Subsequent expenditure related to an item of fixed assets is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance
of performance. All other expenses on existing fixed assets, including
day-to-day repair and maintenance expenditure and cost of replacing
parts, are charged to the statement of profit and loss for the period
during which such expenses are incurred.
Gain or losses arising from derecognition of fixed assets are measured
as the difference between net disposal proceeds and the carrying amount
of the asset and are recognized in the statement of profit and loss
when the asset is derecognized.
E) Intangible Assets
Intangible assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. The cost
comprises of an intangible asset comprises its purchase price including
import duty and other taxes (other than those subsequently recoverable
from taxing authorities), and any directly attributable expenditure on
making the asset ready for its intended use and net of any trade
discounts and rebates. Subsequent expenditure on an intangible assets
after its purchase/ completion is recognized as an expense when
incurred unless it is probable that such expenditure will enable the
asset to generate future economic benefit in excess of its originally
assessed standards of performance and such expenditure can be measured
and attributed to the asset reliably, in which case such expenditure is
added to the cost of the asset.
F) Depreciation and Amortization
Depreciation on fixed assets has been provided on a pro-rata basis from
the month are put to use at straight-line method at the rate and manner
provided in schedule XIV of the companies Act, 1956 except in respect
of the following the categories of assets, in whose case the life of
the assets has been assessed as under:
Assets costing up to Rs. 5000/- are fully depreciated in the year of
acquisition. Leasehold land is not depreciated.
G) Retirement Benefits to Employees
a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, Gratuity has been
provided in the books of accounts on accrual basis by HR Department of
the company. Gratuity calculation is not made on the basis of Actuarial
Report. However, the gratuity calculation is computed by the
management based on assumption that such benefits are payable to all
eligible employees at the time of retirement and superannuation.
b. Provident Fund/ESI
* Company''s contribution paid/payable during the year to provident fund
and ESIC are charged to Profit & loss Account. There are no other
obligations other than contribution payable to the respective
authorities.
* Eligible employees receive benefits from a provident fund, which is a
defined benefit plan. Both the employee and the Company make monthly
contributions to the provident fund plan equal to a specified
percentage of the covered employee''s salary.
c. Bonus
Bonus is eligible to employees on the maximum rate of 20% of Basic Pay
as per payment of Bonus Act, 1965 and to other employees at the rate of
8.33% on Basic Pay and shown as Ex-gratia. However payment has been
made to the employees till date in respect of previous accounting years
but the provision has been made in respect of current accounting
period.
H) Foreign Currency Transactions
Cost of imported raw material is converted to Indian currency at the
rate prevailing on the date of debiting such transaction by the bank as
prescribed AS - 11 of ICAI.
I) Inventories
* Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. However, materials and other items held
for use in the production of inventories are not written down below
cost if the finished products in which they will be incorporated are
expected to be sold at or above cost.
* The stock of Work-in-progress is valued on estimated cost basis and
finished goods of the Business have been valued at the lower of cost
and net realizable value. The cost has been measured on the actual cost
basis and includes cost of materials, custom duty and cost of
conversion to its present location and conditions. All other
inventories of stores, consumables, raw materials are valued at landed
cost. The stock of waste is also valued at realizable value. Net
realizable value is the estimated selling price in the ordinary course
of business, less estimated costs of completion and estimated costs
necessary to make the sale. Stock - in- Transit is valued at cost.
J) lnvestments
Investments are classified as long term or current based on intention
of the management at the time of purchase. Investments are classified
into current and long-term investments.
On initial investment are measured at cost. The cost comprises purchase
price and directly attributable acquisition charges. Dividend
reinvested in case of mutual funds is added to the value of investment
in mutual funds with corresponding credit is made to the profit and
loss statement.
Current investments are carried in the financial statements at lower of
cost and fair value. Long-term investments are stated at cost. A
provision for diminution is made to recognize a decline, other than
temporary, in the value of long-term investments.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is charged or credited to the
statement of profit & loss.
The company has investments of Rs. 3000/- in NSC and Rs. 100/- in 10
Equity shares of Rs. 10 each of Palsoft Info systems Limited which are
recorded at cost in the books of accounts.
K) Cash Flow Statement
Cash flows are reported using the indirect method as prescribed by AS -
3, whereby profit before tax is adjusted for the effects of
transactions of a non-cash nature, any deferrals or accruals of past or
future operating cash receipts or payments and item of income or
expenses associated with investing or financing cash flows. The cash
flows from operating, investing and financing activities of the company
are segregate.
L) Taxation
Income tax payable comprises of 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 assets and deferred tax liability is calculated by applying tax
rate and tax laws that have been enacted by the balance sheet date as
prescribed by AS - 22 of ICAI.
However, company has not recognized deferred tax assets/liabilities
during the year in view of negative reserve & surplus , unabsorbed
depreciation and carry forward losses as there is no convincing
evidence to support that sufficient future taxable income will be
available against which deferred tax assets can be realized. The
company has sufficient carry forward losses from previous year hence
does not give effect of deferred tax in the books of accounts.
M) Impairment of Assets
An asset is considered as impaired in accordance with Accounting
Standard 28 on Impairment of Assets when at balance sheet date there
are indications of impairment and the carrying amount of the asset, or
where applicable the cash generating unit to which the asset belongs,
exceeds its recoverable amount (i.e. the higher of the asset''s net
selling price and value in use).
N) Provisions and Contingent Liabilities
A provision is recognized if, as a result of a past event, the company
has a present legal obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by the best estimate
of the outflow of economic benefits required to settle the obligation
at the reporting date. Where no reliable estimate can be made, a
disclosure is made as contingent liability. A disclosure for a
contingent liability is also 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 possible obligation or a present
obligation in respect of which the likelihood of outflow of resources
is remote, no provision or disclosure is made.
O) Prior Period Items
Prior period items which arise in the current period as a result of
''errors'' or ''omissions'' in the financial statements prepared in earlier
years effects of changes in estimates of which are not treated as
omission or error.
Mar 31, 2013
CORPORATE INFORMATION
Autopal Industries Limited (AIL) incorporated as a public limited
company under the provision of Companies Act 1956. The present
directors and key management persons are Shri Dharam Pal Gupta, Anup
Gupta, Ram Ratan Rawat, Shailender Kumar and Mata Deen Sharma. The
company is in the production of LED''s. Conservation of energy is the
need of the hour. Due to limited power resources, the burden of cost
on an average person is inflating day by day, which can be addressed by
using energy saving product viz. Compact Fluorescent Lamps (CFL)/ LED.
A trend of power efficient lightening equipments is following on. Urban
people are continuously using the CFL as they are cost conscious and
understanding the benefits of energy efficient measures. The Government
started making publicity in semi-urban and rural areas regarding the
benefits of usage of LED/CFL over traditional incandescent bulbs and it
helps the industry to create new demand of the products. The LED is
very cost conscious and uses less energy. The market of LED is on the
boom in the current scenario.
1.1 Basis of preparation of financial statements
A. Basis of Accounting & Preparation of Financial Statements
These financial statements of the Company are prepared in accordance
with Indian Generally Accepted Accounting Principles (GAAP) under the
historical cost convention on the accrual basis. GAAP comprises
mandatory accounting standards as prescribed by the Companies
(Accounting Standards) Rules, 2006, the provisions of the Companies
Act, 1956 and guidelines issued by the Securities and Exchange Board of
India (SEBI). Accounting policies have been consistently applied except
where a newly issued accounting standard is initially adopted or a
revision to an existing accounting standard requires a change in the
accounting policy hitherto in use.
B. Use of Estimates
The preparation of the financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the
reported balances of assets and liabilities and disclosures relating to
contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the period.
Accounting estimates could change from period to period. Actual results
could differ from those estimates. Appropriate changes in estimates are
made as the Management becomes aware of changes in circumstances
surrounding the estimates. Changes in estimates are reflected in the
financial statements in the period in which changes are made and, if
material, their effects are disclosed in the notes to the financial
statements.
C. Revenue Recognition
Revenue is primarily derived from manufacturing LED. Revenue part also
comprises of income from trading of CR Coil in Cut, fans, LED and down
liters. The Income and Expenditure are accounted on accrual basis,
except dividend which is accounted for on receipt basis. Revenue from
sale of goods is recognized when all the significant risks and rewards
of ownership of the goods have been passed to the buyer.
D. Tangible Assets
Fixed assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. Cost comprises
of all costs incurred to bring the assets to their location and working
condition and includes all expenses incurred up to the date of
commercial utilization.
Subsequent expenditure related to an item of fixed assets is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance
of performance. All other expenses on existing fixed assets, including
day-to-day repair and maintenance expenditure and cost of replacing
parts, are charged to the statement of profit and loss for the period
during which such expenses are incurred.
Gain or losses arising from derecognition of fixed assets are measured
as the difference between net disposal proceeds and the carrying amount
of the asset and are recognized in the statement of profit and loss
when the asset is derecognized.
Capital Work-in-Progress
Projects under which assets are not ready for their intended use and
other Capital work-in- progress are carried at cost comprising direct
cost and related incidental expenses.
E. Intangible Assets
Intangible assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. The cost
comprises of an intangible asset comprises its purchase price including
import duty and other taxes (other than those subsequently recoverable
from taxing authorities), and any directly attributable expenditure on
making the asset ready for its intended use and net of any trade
discounts and rebates. Subsequent expenditure on an intangible assets
after its purchase/ completion is recognized as an expense when
incurred unless it is probable that such expenditure will enable the
asset to generate future economic benefit in excess of its originally
assessed standards of performance and such expenditure can be measured
and attributed to the asset reliably, in which case such expenditure is
added to the cost of the asset.
F. Depreciation and Amortization
Depreciation on fixed assets has been provided on the straight-line
method at the rate and manner provided in schedule XIV of the companies
Act, 1956 over the useful lives of assets estimated by management
keeping 5% of Residual value of assets in books of accounts.
Depreciation for assets purchased/sold during a period is
proportionally charged.
Leasehold land is not depreciated.
G. Retirement Benefits to Employees
a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, Gratuity has been
provided in the books of accounts on accrual basis. Gratuity
calculation is not made on the basis of Actuarial Report. However, the
gratuity calculation is computed by the management based on assumption
that such benefits are payable to all eligible employees at the time of
retirement and superannuation.
b. Provident Fund/ESI
Companys contribution paid/payable during the year to provident fund
and ESIC are charged to Profit & loss Account.
There are no other obligations other than contribution payable to the
respective authorities.
Eligible employees receive benefits from a provident fund, which is a
defined benefit plan. Both the employee and the Company make monthly
contributions to the provident fund plan equal to a specified
percentage of the covered employees salary.
c. Bonus
Bonus is eligible to employees on the maximum rate of 20% of Basic Pay
as per payment of Bonus Act, 1965 and to other employees at the rate of
8.33% on Basic Pay and shown as Ex-gratia. However, no payment has been
made to the employees till date in respect of previous accounting years
but the provision has been made in respect of current accounting
period.
H. Foreign Currency Transactions
Cost of imported raw material is converted to Indian currency at the
rate prevailing on the date of debiting such transaction by the bank as
prescribed AS - 11 of ICAI.
I. Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. However, materials and other items held
for use in the production of inventories are not written down below
cost if the finished products in which they will be incorporated are
expected to be sold at or above cost.
The stock of Work-in-progress is valued on estimated cost basis and
finished goods of the Business have been valued at the lower of cost
and net realizable value. The cost has been measured on the actual cost
basis and includes cost of materials, custom duty and cost of
conversion to its present location and conditions. All other
inventories of stores, consumables, raw materials are valued at landed
cost. The stock of waste is also valued at realizable value. Net
realizable value is the estimated selling price in the ordinary course
of business, less estimated costs of completion and estimated costs
necessary to make the sale. Stock  in  Transit is valued at cost.
J. Investments
Investments are classified as long term or current based on intention
of the management at the time of purchase. Investments are classified
into current and long-term investments.
On initial investment are measured at cost. The cost comprises purchase
price and directly attributable acquisition charges. Dividend
reinvested in case of mutual funds is added to the value of investment
in mutual funds with corresponding credit is made to the profit and
loss statement.
Current investments are carried in the financial statements at lower of
cost and fair value. Long- term investments are stated at cost. A
provision for diminution is made to recognize a decline, other than
temporary, in the value of long-term investments.
On disposal of an investment, the difference between its carrying
amount and net disposal proceeds is charged or credited to the
statement of profit & loss.
The company has investments of Rs. 3000/- in NSC and Rs. 100/- in 10 Equity
shares of Rs. 10 each of Palsoft Info systems Limited which are recorded
at cost in the books of accounts.
K. Cash Flow Statement
Cash flows are reported using the indirect method as prescribed by AS -
3, whereby profit before tax is adjusted for the effects of
transactions of a non-cash nature, any deferrals or accruals of past or
future operating cash receipts or payments and item of income or
expenses associated with investing or financing cash flows. The cash
flows from operating, investing and financing activities of the company
are segregate.
L. Taxation
Income tax payable comprises of 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 assets and deferred tax liability is calculated by applying tax
rate and tax laws that have been enacted by the balance sheet date as
prescribed by AS - 22 of ICAI.
However, deferred tax assets/liabilities are not recognized on account
of unabsorbed depreciation and carry forward losses as there is no
convincing evidence to support that sufficient future taxable income
will be available against which deferred tax assets can be realized.
The company has sufficient carry forward losses from previous year
hence does not give effect of current and deferred tax in the books of
accounts.
M. Impairment of Assets
An asset is considered as impaired in accordance with Accounting
Standard 28 on Impairment of Assets when at balance sheet date there
are indications of impairment and the carrying amount of the asset, or
where applicable the cash generating unit to which the asset belongs,
exceeds its recoverable amount (i.e. the higher of the asset''s net
selling price and value in use).
N. Provisions and Contingent Liabilities
A provision is recognized if, as a result of a past event, the company
has a present legal obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by the best estimate
of the outflow of economic benefits required to settle the obligation
at the reporting date. Where no reliable estimate can be made, a
disclosure is made as contingent liability. A disclosure for a
contingent liability is also 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 possible obligation or a present
obligation in respect of which the likelihood of outflow of resources
is remote, no provision or disclosure is made.
O. Prior Period Items
Prior period items which arise in the current period as a result
of''errors'' or ''omissions'' in the financial statements prepared in
earlier years effects of changes in estimates of which are not treated
as omission or error.
Mar 31, 2012
1.1 Basis of preparation of financial statements
(a) Basis of Accounting & Preparation
These financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles (GAAP) under the historical
cost convention on the accrual basis. GAAP comprises mandatory
accounting standards as prescribed by the Companies (Accounting
Standards) Rules, 2006, die provisions of the Companies Act, 1956 and
guidelines issued by the Securities and Exchange Board of India .
(SEBI). The financial statements are also in accordance with the
guidelines of Sick Industrial Companies Act (SICA). Accounting
policies have been consistently applied except where a newly issued
accounting standard is initially adopted or a revision to an existing
accounting standard requires a change in the accounting policy hitherto
in use.
(b) Use of estimates
The preparation of the financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the
reported balances of assets and liabilities and disclosures relating to
contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the period.
Accounting estimates could change from period to period. Actual results
could differ from those estimates. Appropriate changes in estimates are
made as the Management becomes aware of changes in circumstances
surrounding the estimates. Changes in estimates are reflected in the
financial statements in the period in which changes are made and, if
material, their effects are disclosed in the notes to the financial
statements.
1.2 Change in basis of presentation and disclosure of financial
statements
During the year ended 31 March 2012, the revised Schedule VI notified
under the Companies Act 1956, has become mandatory to the company, for
preparation and presentation of its financial statements. The adoption
of Revised Schedule VI does not impact recognition and measurement
principles followed for preparation of financial statements. However,
it has significant impact on presentation and disclosures made in the
financial statements. The company has also regrouped, rearranged and
reclassified the previous year figures in accordance with the BIFR
order and requirements applicable in the current year.
1.3 Revenue recognition
Revenue is primarily derived from manufacturing of CFL, LED and
services of Technical know - how. Revenue part also comprises of income
from trading of fans, LED and down liters. The Income and Expenditure
are accounted on accrual basis, except dividend which is accounted for
on receipt basis. Revenue from sale of goods is recognized when all
the significant risks and rewards of ownership of the goods have been
passed to the buyer.
1.4 Provisions and Contingent Liabilities
A provision is recognized if, as a result of a past event, the company
has a present legal obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by the best estimate
of the outflow of economic benefits required to settle the obligation
at the reporting date. Where no reliable estimate can be made, a
disclosure is made as contingent liability. A disclosure for a
contingent liability is also 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 possible obligation or a present
obligation in respect of which the likelihood of outflow of resources
is remote, no provision or disclosure is made.
1.5 Prior Period Items
Prior period items which arise in the current period as a result of
''errors'' or ''omissions'' in the financial statements prepared in earlier
years effects of changes in estimates of which are not treated as
omission or error.
1.6 Fixed assets
Fixed assets are stated at their original cost of acquisition less
accumulated depreciation and impairment losses if any. Cost comprises
of all costs incurred to bring the assets to their location and working
condition and includes all expenses incurred up to the date of
commercial utilization.
Subsequent expenditure related to an item of fixed assets is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance
of performance. All other expenses on existing fixed assets, including
day- to-day repair and maintenance expenditure and cost of replacing
parts, are charged to the statement of profit and loss for the period
during which such expenses are incurred.
Gain or losses arising from derecognition of fixed assets are measured
as the difference between net disposal proceeds and the carrying amount
of the asset and are recognized in me statement of profit and loss when
the asset is derecognized.
1.7 Depreciation and amortization
Depreciation on fixed assets is provided on the straight-line method at
the rate and manner provided in schedule XIV of the companies Act, 1956
over the useful lives of assets estimated by the Management keeping 5%
of the Residual Value of assets in the books of accounts. Depreciation
for assets purchased / sold during a period is proportionately charged.
Leasehold land is not depreciated.
1.8 Retirement benefits to employees
a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, Gratuity has been
provided in the books of accounts on accrual basis. The gratuity
calculation is computed by the management and based on assumption that
such benefits are payable to all eligible employees at the time of
retirement and superannuation.
b. Provident fund/ESI
Company''s contribution paid/payable during the year to provident fund
and ESIC are charged to Profit & loss Account. There are no other
obligations other than contribution payable to the respective
authorities.
Eligible employees receive benefits from a provident fund, which is a
defined benefit plan. Both the employee and the Company make monthly
contributions to the provident fund plan equal to a specified
percentage of the covered employee''s salary.
c. Bonus
Bonus is eligible to employees on the maximum rate of 20% of Basic Pay
as per payment of Bonus Act, 1965 and to other employees at the rate of
8.33% on Basic Pay and shown as Ex-gratia. However, no payment has been
made to the employees till date in respect of previous accounting years
but the provision has been made in respect of current accounting
period.
1.9 Foreign currency transactions
Cost of imported raw material is converted to Indian currency at the
rate prevailing on the - date of debiting such transaction by the bank
as prescribed AS - 11 of 1CAI.
1.10 Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. However, materials and other items held
for use in the production of inventories are not written down below
cost if the finished products in which they will be incorporated are
expected to be sold at or above cost. The stock of Work-in-progress is
valued on estimated cost basis and finished goods of the Business has
been valued at the lower of cost and net realizable value. The cost has
been measured on the actual cost basis and includes cost of materials,
custom duty and cost of conversion to its present location and
conditions. All other inventories of stores, consumables, raw materials
are valued at landed cost. The stock of waste is also valued at
realizable value. Net realizable value is the estimated selling price
in the ordinary course of business, less estimated costs of completion
and estimated costs necessary to make the sale. Stock-in-Transit is
valued at cost.
1.11 Earnings per share
As per AS-20 issued by ICAI Basic earnings per share are computed by
dividing the net profit after tax by the weighted average number of
equity shares outstanding during the period.
1.12 Investments
The company has investments of Rs. 3000/- in NSC and Rs. 100/- in 10
Equity shares of Rs. 10 each of Pal soft Info systems Limited which are
recorded at cost in the books of accounts.
1.13 Cash flow statement
Cash flows are reported using the indirect method as prescribed by AS -
3, whereby profit before tax is adjusted for the effects of
transactions of a non-cash nature, any deferrals or accruals of past or
future operating cash receipts or payments and item of income or
expenses associated with investing or financing cash flows. The cash
flows from operating, investing and financing activities of the company
are segregate.
1.14 Taxation
Income tax payable comprises of 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 assets and deferred tax liability is calculated by applying tax
rate and tax laws that have been enacted by the balance sheet date as
prescribed by AS-2 of 1CAI.
However, deferred tax assets/liabilities are not recognized on account
of unabsorbed depreciation and carry forward losses as there is no
convincing evidence to support that sufficient future taxable income
will be available against which deferred tax assets can be realized.
The company has sufficient carry forward losses from previous year
hence does not give effect of current and deferred tax in the books of
accounts,
1.15 Impairment of Assets
An asset is considered as impaired in accordance with Accounting
Standard 28 on Impairment of Assets when at balance sheet date there
are indications of impairment and the carrying amount of the asset, or
where applicable the cash generating unit to which the asset belongs,
exceeds its recoverable amount (i.e. the higher of the asset''s net
selling price and value in use). The carrying amount of dies and tools
is reduced to the recoverable amount and the reduction of Rs. 12000/-
is recognized as an impairment loss in the profit and loss account.
Mar 31, 2010
(a) Basis of Accounting
The accounts are prepared under historical cost convention on a going
concern basis and follows the mercantile system of accounting
generally, except non accounting of Deferred Tax.
(b) Fixed Assets
All Fixed assets are stated in the Balance Sheet at cost. The company
capitalized all direct cost relating to Fixed assets acquisitions and
installations.
(c) Depreciation
(1) The Company provides depreciation on straight line method at the
rates and manner provided in Schedule XIV of the Companies Act, 1956.
(2) Lease hold land is not depreciated.
(3) Depreciation on Dies & Tools and vehicles not provided during the
year to maintain NET BLOCK to the extent of 5% of GROSS BLOCK.
(d) Inventories
(1) Raw Material, Stores & Spares, are valued at cost or net realizable
value which ever is lower. The work in progress is valued at estimated
cost.
(2) Finished goods are valued at cost or net realizable value which
ever is lower.
(3) The cost of Imported Raw Material includes custom duties and other
direct expenditures.
(e) Revenue Recognition
The Income and Expenditure are accounted on accrual basis, except
dividend which is accounted for on receipt basis.
(f) Sales
Local sales are inclusive of excise duty but exclusive of Sales Tax and
Trade discount.
(g) Foreign Currency Transaction Cost of Imported raw material is
converted to Indian Currency at the rate prevailing on the date of
debiting such transaction by the Bank.
(h) Employees Benefits
(i) Provident Fund/ESI
Companys contribution paid/payable during the year to provident fund
and E.S.I.C. are charged to Profit & Loss Account. There are no other
obligations other than contribution payable to the respective
authorities. (ii) Gratuity
Gratuity has been provided in the books of accounts on accrual basis.
The gratuity calculation is based on assumption that benefits are
payable to all eligible employees at the end of accouting year.
(i) Taxation
Income Tax expenses comprise current tax and deferred tax charge or
credit. Provision for current tax is made of 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.
(j) Provisions, Contingent Liabilities and Contingent Assets
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 amout of the
obligation. A disclosure for 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.
(k) Investment
The Investment are stated at cost.
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