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Accounting Policies of Chitradurga Spintex Ltd. Company

Mar 31, 2015

Basis for preparation of accounts

The financial statements have been prepared on an accrual basis of accounting and in accordance with the Generally Accepted Accounting Principles in India, provisions of the Companies Act, 2013 and comply in material aspects with the accounting standards notified under Section 133 of the Act, read with Companies (Accounting Standards) Rules, 2014, except for gratuity which is accounted on cash basis.

Estimates

The preparation of financial statements requires the Management of the Company to make estimates and assumptions that affect the reported balance of assets and liabilities, revenue and expenses and disclosures relating to contingent liabilities. The Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Future results could differ from these estimates. Any revision of accounting estimates is recognised prospectively in the current and future periods.

Revenue Recognition

Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

There was no revenue from business operations during the year since the company have not undertaken any business.

Pursuant to approval of the members through postal ballot on 30.10.2008, the company has amended the main objects of the company accordingly Company has stopped the spinning activity from 31.12.2008 Government Grants and Subsidies Government grants in the nature of promoters contribution like investment subsidy, where no repayment is expected in respect thereof, are treated as capital reserve.

Tangible Fixed Assets

There are no Fixed Assets Depreciation and Amortisation

As there are no fixed assets, there is no depreciation provision.

Valuation of Inventories

There was no inventory in the current financial year.

Foreign Currency Transaction

There was no foreign currency transaction during the year.

Investments

Non-current investments are stated at cost

Retirement Benefits

Periodic contributions towards post retirement benefit plan such as provident fund are charged to the Statement of Profit and Loss. However, no provision for gratuity is made which is contrary to the Accounting Standard 15 issued by The Institute of Chartered Accountants of India.

Taxation

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the provisions of local Income Tax Laws as applicable to the financial year.

Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

Deferred Tax

Company has not recognised deferred tax asset as there in no reasonable certainity that in future sufficient taxable income will be available against which such defered tax asset can be realised.

Previous year's figures have been regrouped/ reclassified wherever necessary to correspond with the current year's classification/disclosures.


Mar 31, 2014

Basis for preparation of accounts

The financial statements have been prepared on an accrual basis of accounting and in accordance with the Generally Accepted Accounting Principles in India, provisions of the Companies Act, 1956 and comply in material aspects with the accounting standards notified under Section 211 (3C) of the Act, read with Companies (Accounting Standards) Rules, 2006.

Estimates

The preparation of financial statements requires the Management of the Company to make estimates and assumptions that affect the reported balance of assets and liabilities, revenue and expenses and disclosures relating to contingent liabilities. The Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Future results could differ from these estimates. Any revision of accounting estimates is recognised prospectively in the current and future periods.

Revenue Recognition

Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

There was no revenue from business operations during the year since the company have not

Pursuant to approval of the members through postal ballot on 30.10.2008, the company has amended the main objects of the company accordingly Company has stopped the spinning activity from 31.12.2008

Government Grants and Subsidies

Government grants in the nature of promoters contribution like investment subsidy, where no repayment is expected in respect thereof, are treated as capital reserve.

Tangible Fixed Assets

Fixed assets are stated at cost of acquisition less accumulated depreciation and impairment losses, if any.The cost of fixed assets includes interest on borrowings attributableto acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date

Depreciation and Amortisation

Depreciation on fixed assets was provided to the extend of depreciation amount on Straight-Line basis at the rate and in the manner prescribed in Schedule XIV to the companies Act, 1956 up to 31.12.2008 being on which date the spinning activity was stopped.

Valuation of Inventories

There was no inventory in the current financial year.

Foreign Currency Transaction

There was no foreign currency transaction during the year.

Investments

Non-current investments are stated at cost Retirement Benefits

Liability on account of short term employee benefits is recognised on an undiscounted and accrual basis during the period when the employee renders service/vesting period of the benefit.

Periodic contributions towards post retirement benefit plan such as provident fund are charged to the Statement of Profit and Loss.

Taxation

Current income tax is measured at the amount expectedto be paid to the tax authorities in accordance with the provisions of local Income Tax Laws as applicable to the financial year.

Earnings Per Share

Basic earnings per share is calculated by dividingthe net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.


Mar 31, 2013

Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements are prepared under the historical cost convention; income and expenditure are accounted on accrual basis except gratuity which will be accounted on payment basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

Use of estimates

The preparation of the financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recongised in the period in which the results are materilised.

Tangible Fixed Assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date.

Depreciation and Amortisation

Depreciation on fixed assets was provided to the extent of depreciable amount on Straight-Line method (SLM) on pro-rata basis at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 up to 31.12.2008 being on which date the spinning activity was stopped.

Foreign currency transactions and translations

There were no foreign currency transactions during the year (previous year Nil.

Government grants, subsidi. and export incentives

Government grants in the nature of promoters'' contribution like investment subsidy, where no repayment is ordinarily expected in respect thereof, are treated as capital reserve.

Investments

Long-term investments are stated at cost of acquisition. Provision for diminution in the value is made only if such a decline is other than temporary.

Revenue recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. There is no revenue from operations during the year since the company has not undertaken any business.

Pursuant to approval of the members through postal ballot on 30.10.2008, the Company has amended the main objects of the Company accordingly Company has stopped the spinning activity from 31.12.2008.

Other income

The main source of other income is from rental income by leasing existing building of the company which is recognized on accrual basis.

Employee benefits

Short term employee benefits are recognized as an expense in the profit and loss account of the year in which the related service is rendered, which includes salary to staff, provident fund contribution and contribution to the Employees State Insurance.

Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax by number of equity shares outstanding during the year.

Taxes on income

As the Company has no taxable income for the A.Y. 2013-2014, no tax provision is made. Taking into account the consideration of prudence, no asset or liability is anticipated on account of deferred tax.

Impairment of assets

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, except in case of revalued assets.

Provisions and contingencies

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 an 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.


Mar 31, 2012

Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements are prepared under the historical cost convention, income and expenditure are accounted on accrual basis except gratuity which will be accounted on payment basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

Use of estimates

The preparation of the financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recongised in the period in which the results are materilised.

Tangible Fixed Assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date.

Depreciation and Amortisation

Depreciation on fixed assets was provided to the extent of depreciable amount on Straight-Line method (SLM) on pro-rata basis at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 up to 31.12.2008 being on which date the spinning activity was stopped.

Foreign currency transactions and translations

There were no foreign currency transactions during the year (previous year Nil.

Government grants, subsidies and export incentives

Government grants in the nature of promoters' contribution like investment subsidy, where no repayment is ordinarily expected in respect thereof, are treated as capital reserve.

Investments

Long-term investments are stated at cost of acquisition. Provision for diminution in the value is made only if such a decline is other that temporary.

Revenue recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. There is no revenue from operations during the year since the company has not undertaken any business.

Pursuant to approval of the members through postal ballot on 30.10.2008, the Company has amended the main objects of the Company accordingly Company has stopped the spinning activity from 31.12.2008.

Other income

The main source of other income is from rental income by leasing existing building of the company which is recognized on accrual basis.

Employee benefits

Short term employee benefits are recognized as an expense in the profit and loss account of the year in which the related service is rendered, which includes salary to staff, provident fund contribution and contribution to the Employees State Insurance.

Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax by number of equity shares outstanding during the year.

Taxes on income

As the Company has no taxable income for the A.Y. 2012-2013, no tax provision is made. Taking into account the consideration of prudence, no asset or liability is anticipated on account of deferred tax.

Impairment of assets

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate ' discount factor. When there is indication that an impairment loss recognised for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, except in case of revalued assets.

Provisions and contingencies

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 an 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.


Mar 31, 2011

1.1 The accounts are prepared in accordance with the historical cost convention, income and expenditure are accounted on accrual basis except gratuity which will be accounted on payment basis.

1.2. Fixed Assets: Fixed assets are stated at cost less Depreciation. Depreciation is being provided at revised rates specified as per schedule XIV to the Companies Act 1956 on Straight-Line method on prorata basis up to 31.12.2008 being on which date the spinning activity was stopped.

1.3. Investments are stated at cost.


Mar 31, 2010

1.1 (a) The accounts are prepared in accordance with the historical cost convention, income and expenditure are accounted on accrual basis except gratuity which will be accounted on payment basis.

1.1 (b) Sales includes amounts recovered towards Sales Tax.

1.2. Fixed Assets: Fixed assets are stated at cost less Depreciation. Depreciation is being provided at revised rates specified as per schedule XIV to the Companies Act 1956 on Straight-Line method on prorata basis up to 31.12.2008 being on which date the spinning activity was stopped.

1.3. Investments are stated at cost.

2. Pursuant to approval of the members through postal ballot on 30.10.2008, the Company has amended the main objects of the Company, accordingly Company has stopped the spinning activity from 31.12.2008.

3. On account of loss on sale of machineries, deteriorated rawmaterial stock and payment of huge amount of arrears of sales tax on account of non grant of textile policy by the State Government the company has incurred loss of Rs.89.74 lakhs during the year.