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Accounting Policies of Cenlub Industries Ltd. Company

Mar 31, 2015

2.1 Basis of preparation of financial statements

The financial statements are prepared on accrual basis under the historical cost convention, modified to include revaluation of certain assets, in accordance with applicable Accounting Standards (AS) specified in the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013.

2.2 Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future years.

2.3 Revenue recognition

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership in the goods to the customer.

Revenue from services is recognised on rendering of services to customers.

Interest income is recognised using the time proportion method, based on underlying interest rates.

2.4 Tangible fixed assets and capital work-in-progress

Fixed assets, including capital work in progress are stated at cost of acquisition or construction less accumulated depreciation. Cost comprises the purchase price and any directly attributable costs of bringing the asset to its working condition for the intended use. Tangible fixed assets under construction are disclosed as Capital work- in-progress.

2.5 Intangible assets

Intangible assets comprising computer software are stated at cost, including taxes, less accumulated amortisation. Computer software is amortised on a straight line basis at the rates prescribed for the computers in schedule II of Companies Act.

2.6 Borrowing Cost

Financing costs relating to borrowed funds attributable to construction or acquisition of qualifying assets for the period up to the completion of construction or acquisition of such assets are included in the cost of the assets. All borrowing costs are charged to Statement of Profit and Loss.

2.7 Impairment

The carrying values of assets are reviewed at each reporting date to determine whether there is any indication of impairment. If such indication exists, the amount recoverable towards such asset is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the Statement of Profit and Loss. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortisation, if no impairment loss has been recognised.

2.8 Depreciation

Depreciation is calculated on fixed assets on Straight line method in accordance with schedule XIV of the Companies Act, 1956 prorata from the month in which assets are acquired & put to use and in respect of deductions, upto and including the month in which such deductions are made.

2.9 Inventories

Inventories are valued at the lower of cost and net realisable value. Cost includes all applicable costs incurred in bringing goods to their present location and condition, determined on a first in first out basis.

2.10 Foreign currency transactions

Foreign currency transactions are recorded by applying the prevailing exchange rate on transaction date. All exchange rate differences are dealt with in Profit and Loss Account.

2.11 Provisions and contingencies

A provision is created when there is a present obligation as a result of a past event that entails a probable outflow of resources and a reliable estimate can be made of the amount of the obligation. Disclosure of a contingent liability is made when there is a possible but not probable obligation or a present obligation that may, but probably will not, entail an outflow of resources. When there is an obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

2.12 Taxation

Tax expenses for the period, comprising current tax and deferred tax, is included in determining the net profit/(loss) for the year. The company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statement. The deferred tax charge of credit is recognised using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.

2.13 Employee benefits

(a) Defined-contribution plans

Contributions to the Employees' Regional Provident Fund, Superannuation Fund, Employees Pension Scheme and Employees' state Insurance are recognised as defined contribution plant and charges as expenses during the period in which the employees perform the services.

(b) Defined-benefit plans

Retirement benefits in the form of gratuity and Leave Encashment are considered as defined benefit plant and determined on actuarial valuation using the Projected Unit Credit Method at the balance sheet date. Actuarial Gains and Losses are recognised immediately in the Profit & Loss Accounts.

(c) Short term employee benefits:

Short term benefits are charged off at the undiscounted amount in the year in which the related service is rendered.

2.14 Investments

Long term investments are valued at cost. Any decline other than temporary, in the value of long-term investments, is adjusted in the carrying value of such investments. Diminution, if any, is determined individually for each long-term investment. Current investments are valued at the lower of cost and fair value of individual scrips.

2.15 Earnings per share

Basic earnings per share are computed by dividing the net profit/(loss) for the year attributable to the equity shareholders with the weighted average number of equity shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of equity and dilutive potential equity shares outstanding during the year, except where the results would be anti-dilutive.

2.16 Leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are classified as operating leases. Lease rents under operating leases are recognized in the Statement of Profit and Loss on a straight line basis over the lease term.

2.17 Events occurring after the balance sheet date

Adjustment to assets and liabilities are made for events occurring after the balance sheet date that provide additional information materially affecting the determination of the amount of assets and liabilities relating to condition existing at the balance sheet date.

2.18 During the year a fraud of Rs. 18,23,877 was detacted, conducted by HR Manager. Appropriate action against him and FIR in this respect has also been made with jurisdiction police station.




Mar 31, 2014

1 Basis of preparation of financial statements

The financial statements are prepared on accrual basis under the historical cost convention, modified to include revaluation of certain assets, in accordance with applicable Accounting Standards (AS) specified in the Companies (Accounting Standards) Rules, 2006 and presentational requirements of the Companies Act, 1956.

This is the first year of application of the revised Schedule VI to the Companies Act, 1956 for the preparation of the financial statements of the company. The revised Schedule VI introduces some significant conceptual changes as well as new disclosures. These include classification of all assets and liabilities into current and non-current. The previous year figures have also undergone a major reclassification to comply with the requirements of the revised Schedule VI.

2 Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future years.

3 Revenue recognition

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership in the goods to the customer Revenue from services is recognised on rendering of services to customers.

Interest income is recognised using the time proportion method, based on underlying interest rates.

4 Tangible fixed assets and capital work-in-progress

Fixed assets, including capital work in progress are stated at cost of acquisition or construction less accumulated depreciation. Cost comprises the purchase price and any directly attributable costs of bringing the asset to its working condition for the intended use. Tangible fixed assets under construction are disclosed as Capital work-in-progress.

5 Intangible assets

Intangible assets comprising computer software are stated at cost, including taxes, less accumulated amortisation. Computer software is amortised on a straight line basis at the rates prescribed for the computers in schedule XIV of Companies Act.

6 Borrowing Cost

Financing costs relating to borrowed funds attributable to construction or acquisition of qualifying assets for the period up to the completion of construction or acquisition of such assets are included in the cost of the assets. All borrowing costs are charged to Statement of Profit and Loss.

7 Impairment

The carrying values of assets are reviewed at each reporting date to determine whether there is any indication of impairment. If such indication exists, the amount recoverable towards such asset is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the Statement of Profit and Loss. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortisation, if no impairment loss has been recognised.

8 Depreciation

Depreciation is calculated on fixed assets on Straight line method in accordance with schedule XIV of the Companies Act,1956 prorata from the month in which assets are acquired & put to use and in respect of deductions, upto and including the month in which such deductions are made.

1. Company overview

Cenlub Industries Limited is an engineering company primarily engaged in designing, engineering, manufacturing, supply, installation and erection of Lubrication systems.

9 Inventories

Inventories are valued at the lower of cost and net realisable value. Cost includes all applicable costs incurred in bringing goods to their present location and condition, determined on a first in first out basis.

10 Foreign currency transactions

Foreign currency transactions are recorded by applying the prevailing exchange rate on transaction date. All exchange rate differences are dealt with in Profit and Loss Account.

11 Provisions and contingencies

A provision is created when there is a present obligation as a result of a past event that entails a probable outflow of resources and a reliable estimate can be made of the amount of the obligation. Disclosure of a contingent liability is made when there is a possible but not probable obligation or a present obligation that may, but probably will not, entail an outflow of resources. When there is an obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

12 Taxation

Tax expenses for the period, comprising current tax and deferred tax, is included in determining the net profit/(loss) for the year The company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statement. The deferred tax charge of credit is recognised using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.

13 Employee benefits

(a) Defined-contribution plans

Contributions to the Employees'' Regional Provided Fund, Superannuation Fund, Employees Pension Scheme and Employees'' state Insurance are recognised as defined contribution plant and charges as expenses during the period in which the employees perform the services.

(b) Defned-benefit plans

Retirement benefits in the form of gratuity and Leave Encashment are considered as defined benefit plant and determined on actuarial valuation using the Projected Unit Credit Method at the balance sheet date. Actuarial Gains and Losses are recognised immediately in the Profit & Loss Accounts.

(c) Short term employee benefits:

Short term benefits are charged off at the undiscounted amount in the year in which the related service is rendered.

14 Investments

Long term investments are valued at cost. Any decline other than temporary, in the value of long-term investments, is adjusted in the carrying value of such investments. Diminution, if any, is determined individually for each long-term investment. Current investments are valued at the lower of cost and fair value of individual scrips.

15 Earnings per share

Basic earnings per share are computed by dividing the net profit/(loss) for the year attributable to the equity shareholders with the weighted average number of equity shares outstanding during the year Diluted earnings per share are computed using the weighted average number of equity and dilutive potential equity shares outstanding during the year except where the results would be anti-dilutive.

16 Leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are classified as operating leases. Lease rents under operating leases are recognized in the Statement of Profit and Loss on a straight line basis over the lease term.

17 Events occurring after the balance sheet date

Adjustment to assets and liabilities are made for events occurring after the balance sheet date that provide additional information materially affecting the determination of the amount of assets and liabilities relating to condition existing at the balance sheet date.


Mar 31, 2013

1.1 Basis of preparation of financial statements

The financial statements are prepared on accrual basis under the historical cost convention, modified to include revaluation of certain assets, in accordance with applicable Accounting Standards (AS) specified in the Companies (Accounting Standards) Rules, 2006 and presentational requirements of the Companies Act, 1956.

This is the first year of application of the revised Schedule VI to the Companies Act, 1956 for the preparation of the financial statements of the company. The revised Schedule VI introduces some significant conceptual changes as well as new disclosures. These include classification of all assets and liabilities into current and non-current. The previous year figures have also undergone a major reclassification to comply with the requirements of the revised Schedule VI.

1.2 Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future years.

1.3 Revenue recognition

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership in the goods to the customer.

Revenue from services is recognised on rendering of services to customers.

Interest income is recognised using the time proportion method, based on underlying interest rates.

1.4 Tangible fixed assets and capital work-in-progress

Fixed assets, including capital work in progress are stated at cost of acquisition or construction less accumulated depreciation. Cost comprises the purchase price and any directly attributable costs of bringing the asset to its working condition for the intended use. Tangible fixed assets under construction are disclosed as Capital work-in-progress.

1.5 Intangible assets

Intangible assets comprising computer software are stated at cost, including taxes, less accumulated amortisation. Computer software is amortised on a straight line basis at the rates prescribed for the computers in schedule XIV of Companies Act.

1.6 Borrowing Cost

Financing costs relating to borrowed funds attributable to construction or acquisition of qualifying assets for the period up to the completion of construction or acquisition of such assets are included in the cost of the assets. All borrowing costs are charged to Statement of Profit and Loss.

1.7 Impairment

The carrying values of assets are reviewed at each reporting date to determine whether there is any indication of impairment. If such indication exists, the amount recoverable towards such asset is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the Statement of Profit and Loss. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortisation, if no impairment loss has been recognised.

1.8 Depreciation

Depreciation is calculated on fixed assets on Straight line method in accordance with schedule XIV of the Companies Act,1956 prorata from the month in which assets are acquired & put to use and in respect of deductions, upto and including the month in which such deductions are made.

1.9 Inventories

Inventories are valued at the lower of cost and net realisable value. Cost includes all applicable costs incurred in bringing goods to their present location and condition, determined on a first in first out basis.

1.10 Foreign currency transactions

Foreign currency transactions are recorded by applying the prevailing exchange rate on transaction date. All exchange rate differences are dealt with in Profit and Loss Account.

1.11 Provisions and contingencies

A provision is created when there is a present obligation as a result of a past event that entails a probable outflow of resources and a reliable estimate can be made of the amount of the obligation. Disclosure of a contingent liability is made when there is a possible but not probable obligation or a present obligation that may, but probably will not, entail an outflow of resources. When there is an obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

1.12 Taxation

Tax expenses for the period, comprising current tax and deferred tax, is included in determining the net profit/(loss) for the year. The company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statement. The deferred tax charge of credit is recognised using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.

1.13 Employee benefits

(a) Defined-contribution plans

Contributions to the Employees'' Regional Provided Fund, Superannuation Fund, Employees Pension Scheme and Employees'' state Insurance are recognised as defined contribution plant and charges as expenses during the period in which the employees perform the services.

(b) Defined-benefit plans

Retirement benefits in the form of gratuity and Leave Encashment are considered as defined benefit plant and determined on actuarial valuation using the Projected Unit Credit Method at the balance sheet date. Actuarial Gains and Losses are recognised immediately in the Profit & Loss Accounts.

(c) Short term employee benefits:

Short term benefits are charged off at the undiscounted amount in the year in which the related service is rendered.

1.14 Investments

Long term investments are valued at cost. Any decline other than temporary, in the value of long-term investments, is adjusted in the carrying value of such investments. Diminution, if any, is determined individually for each long-term investment. Current investments are valued at the lower of cost and fair value of individual scrips.

1.15 Earnings per share

Basic earnings per share are computed by dividing the net profit/(loss) for the year attributable to the equity shareholders with the weighted average number of equity shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of equity and dilutive potential equity shares outstanding during the year, except where the results would be anti-dilutive.

1.16 Leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are classified as operating leases. Lease rents under operating leases are recognized in the Statement of Profit and Loss on a straight line basis over the lease term.

1.17 Events occurring after the balance sheet date

Adjustment to assets and liabilities are made for events occurring after the balance sheet date that provide additional information materially affecting the determination of the amount of assets and liabilities relating to condition existing at the balance sheet date.


Mar 31, 2010

A) BASIS OF ACCOUNTS The financial statements are prepared in accordance with the historical cost convention on accrual basis of accounting and in accordance with generally accepted accounting practices in India and confirm to the applicable Accounting standards issued by the Institute of Chartered Accountants of India and relevent provisions of the Companies Act, 1956.

b) FIXED ASSETS Fixed assets are stated at cost of acquisition, inclusive of inward freight, duties & taxes and incidental expenses related to acquisition

c) INVENTORIES Raw materials,stores,spares & consumables are valued at cost net of cenvat credit. Stock in process & finished goods and Traded Goods are valued at lower of cost or estimated net realisable value. Scrips are valued, scrip wise, at lower of cost or market price.

d) INVESTMENTS Long term Investments are stated at cost of acquisition inclusive of expenditure incidental to acquisition.

A provision for dimunition is made to recognise a decline, other than temporary in the value of long term investment.

Current Investments are stated at lower of cost or fair value determined on an individual basis.

e) MISCELLANEOUS EXPENDITURE Expenditure in respect of issue of shares, pre-incorporation and other preliminary expenses, are written-off over a period of 10 years from the year in which these are incurred.

f) DEPRECIATION Depreciation is calculated on fixed assets on Straight line method in accordance with schedule XIV of the Companies Act,1956 prorata from the month in which assets are acquired & put to use and in respect of deductions, upto and including the month in which such deductions are made.

g) INCOME FROM INVESTMENTS Income from investments is credited to revenue in the year in which it received.

h) REVENUE RECOGNITION

Revenue is recognised on dispatch of materials to customers from the plant.

I) CONTINGENT LIABILITIES

Unprovided contingent liabilities are disclosed in the accounts by way of notes giving nature and quantum of such liabilities.

j) FOREIGN CURRENCY TRANSACTION

Foreign currency transaction are recorded by applying the prevailing exchange rate on TRANSACTION date.

All exchange rate differences are dealt with in Profit and Loss Account.

k) RETIREMENT BENEFITS

1. Short term benefits are recognised as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

2. Post employment and other long term employee benefits are recognised as an expense in the profit and loss account for the year in which the employee has rendered service. The expense is recognised at the present value of the amount payable determined on the basis of calculating the accrual amount it self, as number of employees is very less.

3. Compensation paid under the companys Voluntary Retirement scheme is charged to the profit and loss account in the year of payment.

l) TAXATION

Tax expense for the period, comprising current tax and deferreed tax, is included in determining the net profit/(loss) for the year.

The Company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statements. The deferred tax charge or credit is recognised using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.

m) Purchases are net of Cenvat Credit. Sales are net of excise duty & sales tax.There is no impact on Profit & Loss Account for Duty & Taxes.

 
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