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Accounting Policies of Bhansali Engineering Polymers Ltd. Company

Mar 31, 2014

(a) Basis of Accounting

The financial statements have been prepared on an accrual basis and under the historical cost convention, modified by revaluation of fixed assets to comply in all material aspects, with the applicable accounting principles in India, mandatory Accounting Standards notified by the Companies (Accounting Standards) Rule, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.

All the 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 Schedule VI to the Companies Act,1956.Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash & cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current/ non-current classification of assets and liabilities.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting year. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates.

(c) Revenue Recognition

(i) The Company recognizes sale at the point of dispatch of goods to the customers. Sales are stated exclusive of Excise duty, Sales tax and are net of sales return and trade discount.

(ii) Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(d) Fixed Assets & Depreciation

(a) Tangible Assets & Depreciation

(i) The Fixed Assets are stated at cost of acquisition/construction and includes amounts added on revaluation , wherever assets are revalued, less accumulated depreciation. All cost including financing cost attributable to the fixed assets to bring the assets to their intended use are capitalised.

(ii) Depreciation on plant and machinery (other than continuous process plant) has been calculated on the written down value method at the rates specified in Schedule XIV to the Companies Act, 1956.

(iii) Depreciation on all other assets, other than leasehold land and Intangibles including continuous process plant, has been calculated on the straight line method at the rates specified in Schedule XIV to the Companies Act, 1956.

(iv) Cost of leasehold land is not amortised over the lease period.

(v) Depreciation on the assets purchased/ sold during the year has been provided on a pro-rata basis.

(b) Intangible assets and amortization:- Intangible assets are valued at cost less amortization and comprise mainly of computer software licenses. Amortization takes place on a straight line basis over the assets anticipated useful life. The useful life is determined based on the period over which the intangible asset is expected to be used and generally does not exceed 5 years.

(e) Valuation of Inventories

(i) Inventories are stated at cost or net realisable value whichever is lower. Cost include purchase price, non refundable taxes and delivery and handling cost and all costs incurred in bringing the inventory to its present location and condition. Cost of raw materials, process chemicals, stores and spares , packing material, and other inventory is determined on weighted average basis.

(ii) Finished goods and work in progress include cost of conversion and other costs.

(f) Employee benefts

(i) Defined Contribution Plan

Company''s contributions paid/payable during the year to Provident Fund, ESIC, Labour Welfare Fund and Superannuation Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The company''s liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

(g) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of the transaction and exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

(ii) Amounts of foreign currency transactions remaining pending at the year end are recorded at the exchange rate prevailing at that time.

(iii) All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

(h) Borrowing Cost

Borrowing costs attributable to acquisition and/or construction of qualifying assets are capitalised as a part of the cost of these capitalised assets, up to the date when such assets is ready for its intended use. Borrowing costs on working capital is charged to Profit and Loss Account for the year.

(i) Excise Duty

Cenvat is accounted as per exclusive method of accounting in terms of Accounting Standard – 2 on Valuation of Inventories, issued by the Institute of Chartered Accountants of India.

(j) Taxation

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(k) Leased Assets

Assets acquired under finance lease, if any, which effectively transfer to the Company all the risks and benefits are disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability.

(l) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

(m) Impairment of Assets

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


Mar 31, 2013

(a) Basis of Accounting

The financial statements have been prepared to comply in all material aspects with applicable accounting principles in India'' mandatory Accounting Standards notified by the Companies (Accounting Standards) Rule'' 2006 (as amended) and the relevant provisions of the Companies Act'' 1956.The financial statements are prepared under historical cost convention modified by revaluation of fixed assets. For recognition of Income and Expenses'' mercantile system of accounting is followed.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting year. Although these estimates are based upon management’s best knowledge of current events and actions'' actual results could differ from these estimates.

(c) Revenue Recognition

(i) The Company recognizes sale at the point of dispatch of goods to the customers. Sales are stated exclusive of Excise duty'' Sales tax and are net of sales return and trade discount.

(ii) Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(d) Fixed Assets & Depreciation

(a) Tangible Assets & Depreciation

(i) The Fixed Assets are stated at cost of acquisition/construction and includes amounts added on revaluation'' wherever assets are revalued'' less accumulated depreciation. All cost including financing cost attributable to the fixed assets to bring the assets to their intended use are capitalised.

(ii) Depreciation on plant and machinery (other than continuous process plant) has been calculated on the written down value method at the rates specified in Schedule XIV to the Companies Act'' 1956.

(iii) Depreciation on all other assets'' other than leasehold land and Intangibles including continuous process plant'' has been calculated on the straight line method at the rates specified in Schedule XIV to the Companies Act'' 1956.

(iv) Cost of leasehold land is not amortised over the lease period.

(v) Depreciation on the assets purchased/ sold during the year has been provided on a pro-rata basis.

(b) Intangible Assets and Amortization:- Intangible assets are valued at cost less amortization and comprise mainly of computer software licenses. Amortization takes place on a straight line basis over the assets anticipated useful life. The useful life is determined based on the period over which the intangible asset is expected to be used and generally does not exceed 5 years.

(e) Valuation of Inventories

(i) Inventories are stated at cost or net realisable value whichever is lower. Cost include purchase price'' non refundable taxes and delivery and handling cost and all costs incurred in bringing the inventory to its present location and condition. Cost of raw materials'' process chemicals'' stores and spares '' packing material'' and other inventory is determined on weighted average basis.

(ii) Finished goods and work in progress include cost of conversion and other costs.

(f) Employee benefts

(i) Defned Contribution Plan

Company’s contributions paid/payable during the year to Provident Fund'' ESIC'' Labour Welfare Fund and Superannuation Fund are recognised in the Profit & Loss Account.

(ii) Defned beneft plan

The company’s liabilities towards gratuity and leave encashment'' a defined benefit obligation'' is accrued and provided for on the basis of actuarial valuation'' using the projected unit credit method as at the Balance Sheet date.

(g) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of the transaction and exchange difference'' if any'' on settlement of transaction is recognised in the Profit & Loss Account.

(ii) Amounts of foreign currency transactions remaining pending at the year end are recorded at the exchange rate prevailing at that time.

(iii) All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

(h) Borrowing Cost

Borrowing costs attributable to acquisition and/or construction of qualifying assets are capitalised as a part of the cost of these capitalised assets'' up to the date when such assets is ready for its intended use. Borrowing costs on working capital is charged to Profit and Loss Account for the year.

(i) Excise Duty

Cenvat is accounted as per exclusive method of accounting in terms of Accounting Standard – 2 on Valuation of Inventories'' issued by the Institute of Chartered Accountants of India.

(j) Taxation

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act'' 1961.

(ii) Deferred tax is recognised'' subject to consideration of prudence on timing difference'' being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available'' against which such deferred tax asset will realise.

(k) Leased Assets

Assets acquired under finance lease'' if any'' which effectively transfer to the Company all the risks and benefits are disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability.

(l) Provisions'' Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

(m) Impairment of Assets

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


Mar 31, 2012

(a) Basis of Accounting

The financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, mandatory Accounting Standards notified by the Companies (Accounting Standards) Rule, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.The financial statements are prepared under historical cost convention modified by revaluation of fixed assets. For recognition of Income and Expenses, mercantile system of accounting is followed.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting year. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates.

(c) Revenue Recognition

(i) The Company recognizes sale at the point of dispatch of goods to the customers. Sales are stated exclusive of Excise duty, Sales tax and are net of sales return and trade discount.

(ii) Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(d) Fixed Assets & Depreciation

(a) Tangible Assets & Depreciation

(i) The Fixed Assets are stated at cost of acquisition/construction and includes amounts added on revaluation less accumulated depreciation. All cost including financing cost attributable to the fixed assets to bring the assets to their intended use are capitalized.

(ii) Depreciation on plant and machinery (other than continuous process plant) has been calculated on the written down value method at the rates specified in Schedule XIV to the Companies Act, 1956.

(iii) Depreciation on all other assets, other than leasehold land and Intangibles including continuous process plant, has been calculated on the straight line method at the rates specified in Schedule XIV to the Companies Act, 1956.

(iv) Cost of leasehold land is not amortized over the lease period.

(v) Depreciation on the assets purchased/ sold during the year has been provided on a pro-rata basis.

(b) Intangible assets and amortization:-

Intangible assets are valued at cost less amortization and comprise mainly of computer software licenses. Amortization takes place on a straight line basis over the assets anticipated useful life. The useful life is determined based on the period over which the intangible asset is expected to be used and generally does not exceed 5 years.

(e) Valuation of Inventories

(i) Inventories are stated at cost or net realizable value whichever is lower. Cost include purchase price, nonrefundable taxes and delivery and handling cost and all costs incurred in bringing the inventory to its present location and condition. Cost of raw materials, process chemicals, stores and spares , packing material, and other inventory determined on weighted average basis.

(ii) Finished goods and work in progress include cost of conversion and other costs.

(f) Employee benefits

(i) Defined Contribution Plan

Company's contributions paid/payable during the year to Provident Fund, ESIC, Lab our Welfare Fund and Superannuation Fund are recognized in the Profit & Loss Account.

(ii) Defined benefit plan

The company's liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

Notes forming Part of the Financial Statement

(g) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of the transaction and exchange difference, if any, on settlement of transaction is recognized in the Profit & Loss Account.

(ii) Amounts of foreign currency transactions remaining pending at the year end are recorded at the exchange rate prevailing at that time.

(iii) All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

(iv) In respect of transactions covered by forward exchange contracts, the difference between the forward rate and the exchange rate at the date of transaction is recognized as income or expense over the life of the contract. Forward exchange contracts outstanding as at the balance sheet date are stated at their fair values and gains or losses are recognized in the Profit and Loss Account as exchange differences.

(h) Borrowing Cost

Borrowing costs attributable to acquisition and/or construction of qualifying assets are capitalized as a part of the cost of these capitalized assets, up to the date when such assets is ready for its intended use. Borrowing costs on working capital is charged to Profit and Loss Account for the year.

(i) Excise Duty

Cenvat is accounted as per exclusive method of accounting in terms of Accounting Standard - 2 on Valuation of Inventories, issued by the Institute of Chartered Accountants of India.

(j) Taxation

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognized, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognized unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realize.

(k) Leased Assets

Assets acquired under finance lease, which effectively transfer to the Company all the risks and benefits are disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability.

(l) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

(m) Impairment of Assets

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


Mar 31, 2010

(a) Basis of Accounting

The financial statements are prepared under historical cost convention modified by revaluation of fixed assets and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standards issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting year. Although these estimates are based upon managements best knowledge of current events and actions, actual results could differ from these estimates.

(c) Revenue Recognition

(i) The Company recognises sale at the point of despatch of goods to the customers. Sales are stated exclusive of Excise duty, Sales tax and are net of sales return and trade discount.

(ii) Customs duty benefits in the form of advance license entitlements are recognised on export of goods and are set off from material costs.

(d) Fixed Assets & Depreciation

(i) The Fixed Assets are stated at cost of acquisition/construction and includes amounts added on revaluation less accumulated depreciation. All cost including financing cost attributable to the fixed assets to bring the assets to their intended use are capitalised.

(ii) Depreciation on plant and machinery (other than continuous process plant) has been calculated on the written down value method at the rates specified in Schedule XIV to the Companies Act, 1956. *

(iii) Depreciation on all other assets, other than leasehold land including continuous process plant, has been calculated on the straight line method at the rates specified in Schedule XIV to the Companies Act, 1956.

(iv) Cost of leasehold land is not amortised over the lease period.

(v) Depreciation on the assets purchased/ sold during the year has been provided on a pro-rata basis.

(e) Valuation of Inventories

(i) Inventories are valued at cost except for finished goods which are valued at lower of cost or net

estimated realizable value. (ii) Cost of inventories is computed on Weighted Average basis.

(iii) Finished goods and work in progress include cost of convereion and other costs incurred in bringing the inventories to their present location and condition.

(f) Employee benefits

(i) Defined Contribution Plan

Companys contributions paid/payable during the year to Provident Fund, ESIC, Labour Welfare Fund and Superannuation Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The companys liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

(g) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of the

transaction and exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

(ii). Amounts of foreign currency transactions remaining pending at the year end are recorded at the exchange rate prevailing at that time.

(iii) All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

(iv) In respect of transactions covered by forward exchange contracts, the difference between the forward rate and the exchange rate at the date of transaction is recognized as income or expense ovet the life of the contract.

(h) Borrowing Cost

Borrowing costs attributable to acquisition and/or construction of qualifying assets are capitalised as a part of the cost of these capitalised assets, upto the date when such assets is ready for its intended use. Borrowing costs on working capital is charged to Profit and Loss Account for the year.

(i) Excise Duty

Cenvat is accounted as per exclusive method of accounting in terms of Accounting Standard - 2 on Valuation of Inventories, issued by the Institute of Chartered Accountants of India.

(j) Taxation

(i) , Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

(k) Leased Assets

Assets acquired under finance lease, which effectively transfer to the Company, all the risks and benefits are disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability.

(l) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

(m) Impairment of Assets

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

 
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