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Accounting Policies of Dhanuka Agritech Ltd. Company

Mar 31, 2015

A) Basis of Accounting

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 under section 133 of the Companies Act, 2013 (The Act) read with rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the The Act (to the extent notified) 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 the management to make estimates and assumptions that effect the reported balances of assets and liabilities and disclosures relating to contingent liabilities as at the date of the financial statements and reported amount 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 the estimates are reflected in the financial statements in the period in which changes are made and, if material, there effects are disclosed in the notes to the financial statements.

c) Fixed Assets

(Tangible and Intangible assets)

Fixed Assets are stated at Cost of Acquisition (Net of recoverable taxes, wherever applicable), less accumulated depreciation and impairment loss, if any. Cost is inclusive of freight, duties, levies, installation expenses and any directly attributable cost of bringing the assets to their working condition for intended use which is capitalized till the assets are ready to be put to use.

Subsequent expenditures related to an item of fixed asset are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance.

Projects/ Units under which assets are not ready for their intended use are disclosed under Capital Work-In-Progress.

d) Impairment

Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable.

An impairment loss is recognized in the Statement of Profit and Loss if the carrying amount of an asset exceeds its recoverable amount.

e) Depreciation and Amortisation Tangible Assets :

Depreciation on Tangible Assets is provided on Written Down Value Method (WDV) at the rate and in the manner based on the useful life of the assets as prescribed in Schedule II of the Companies Act, 2013. On the addition of the assets, depreciation has been provided from the day on which the asset was actually put to use. Depreciation in case of disposal/sale of assets is provided up to the date of disposal/sale of assets on pro-rata basis. Assets having cost upto Rs.5000/- have been fully depreciated in the year of acquisition.

Intangible Assets :

Amortization in respect of intangible assets is provided on Straight Line basis considering 10 years as the estimated period of its economic life.

f) Revenue Recognition

Revenue from sale of goods is recognized when risk and rewards in

respect of ownership of goods are transferred to the customers and

no significant uncertainty exists regarding the amount of

consideration that is derived from the sale of goods.

Revenue from sale of products is stated exclusive of Returns, Sales

Tax/VAT and applicable Rebates & Discounts as per Policy of the

Company.

Revenue from Wind mill electricity generation is recognized on the basis of electricity units generated and invoice raised on monthly basis.

Interest income is accounted for on accrual basis taking into account, the amount outstanding and applicable interest rate. Dividend income on Investments is accounted for, when the right to receive the payment is established. Rental income is also accounted for on accrual basis.

g) Inventories

- Inventories of Raw Materials and Packing Materials are valued at Cost (net of CENVAT) on first-in first-out basis.

- Inventory of Work-in-Progress is valued at cost of Raw Material plus conversion cost wherever applicable.

- Finished Goods are valued at the lower of Cost (including overheads and excise duty) or Net Realizable Value.

- Excise duty in respect of closing inventory of Finished goods is included as a part of inventory.

h) Cash Flow Statement

Cash flows are reported using the indirect method, 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 segregated. i) Foreign Currency Transactions

(i) Initial Recognition: Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency on the date of the transaction.

(ii) Conversion: At the year-end, monetary items denominated in the foreign currencies are converted into equivalent rupee value by applying prevalent exchange rates at the year-end.

(iii) Exchange Differences: All the exchange differences arising on settlement / reinstatement of foreign currency transactions are adjusted in the Statement of Profit and Loss.

(iv) Forward Exchange Contracts not intended for trading or speculation purposes: The Company's derivative instruments comprise of forward exchange contracts which are not intended for trade or speculation purposes.

j) Investments

Current investments are carried at lower of cost or quoted /fair value.

Long term investments are stated at cost.

k) Employee Benefits

i) Defined Contribution Plans:

The Company has Defined Contribution Plans for post employment benefits namely Provident Fund and Superannuation Fund which are administered by appropriate Authorities.

The Company contributes to a Government administered Provident Fund, Employees' Deposit Linked Insurance Scheme and Family Pension Fund, on behalf of its employees and has no further obligation beyond making its contribution. The Superannuation Fund applicable to certain employees is a Defined Contribution Plan as the Company contributes to Officers' Superannuation Scheme which is administered by an Insurance Company and has no further obligation beyond making the payment to the Insurance Company. The Company contributes to State Plans namely Employees State Insurance Fund and has no further obligation beyond making the payment to them.

The Company's contributions to the above funds are charged to revenue every year.

ii) Defined Benefit Plans:

The Company has a Defined Benefit Plan namely Gratuity and Pension covering its employees. The Gratuity scheme is funded through Group Gratuity-cum-Life Assurance Scheme and the liability for the Defined Benefit Plan of Gratuity and Pension is provided based on an actuarial valuation at the year-end. iii) Other Employee Benefits:

The employees of the Company are entitled to leave encashment and incentives as per the Policy of the Company The liability in respect of the same is provided based on an actuarial valuation at the year-end.

l) Leases

Lease payments under operating leases are recognized as expense in the statement of profit and loss for the year to which they pertains.

m) Taxes on Income

Provision for Income Tax comprises of Current Tax and Deferred Tax charge. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961.

Deferred Tax is recognized, subject to consideration of prudence, on timing differences, being difference between taxable and accounting income and expenditure that originate in one period and are capable of reversal in one or more subsequent period(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 assets will be realized.

n) Provisions and Contingencies

The Company recognizes a Provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation.

A disclosure for a Contingent Liability is made when there is possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure as specified in Accounting Standard 29 -"Provisions, Contingent Liabilities and Contingent Assets" is made.

Contingent Assets are not recognized in the Financial Statements.

o) Earnings Per Share (EPS)

The earnings considered in ascertaining the Company's EPS, is the Net Profit after Tax. The number of Equity Shares used in computing basic EPS is the weighted average number of Equity Shares outstanding during the year. p) Research and Development Expenses Research and Development Expenses of revenue nature are charged to Profit and Loss Account.

q) Government Grants

Where a grant or subsidy relates to an asset, its value is deducted in arriving at the carrying amount of the related assets. Other Government grants or subsidies are credited to Profit and Loss Account or adjusted from related expenses. r) Deferred Revenue Expenditure Revenue expenditure where benefit is expected to accrue over a longer period is amortized equally over a period of 5 years.

s) Principles of Consolidation

The Consolidated Financial Statements relate to Dhanuka Agritech Ltd. (the Company') and its Subsidiary Company - Dhanuka Agri- Solutions Private Limited. The Consolidated Financial Statements have been prepared on the following basis:

i) The Financial Statements of the Company and its Subsidiary

Company are combined on a line by line basis by adding together the book values of like items of Assets, Liabilities, Income and Expenses after fully eliminating intra-group balances and intra-group transactions in accordance with Accounting Standard (AS) - 21 "Consolidated Financial Statements."

ii) As far as possible, the Consolidated Financial Statements are

prepared using uniform Accounting Policies for like transactions and other events in similar circumstances and are presented in the same manner as the Company's separate Financial Statements.


Mar 31, 2012

Not Available


Mar 31, 2011

A) Basis of Accounting:

The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting with the accounting principles generally accepted in India (GAAP) and comply with the mandatory Accounting standards (AS) issued by the Institute of Chartered Accountants of India to the extent applicable and with the relevant provisions of the Companies Act, 1956.

b) Fixed Assets:

Fixed Assets are stated at cost of acquisition (net of CENVAT, wherever applicable), less accumulated depreciation till the end of financial year. Cost is inclusive of freight, duties, levies, installation expenses and any directly attributable cost of bringing the assets to their working condition for intended use which are capitalized till the assets are ready to be put to use.

c) Depreciation:

Depreciation on fixed assets is provided on written down value method (WDV) at the rate and in the manner prescribed in schedule XIV to the Companies Act, 1956. On the addition of the assets, depreciation has been provided from the day on which the asset was actually put to use. Depreciation in case of disposal/sale of assets is provided up to the date of disposal/sale of assets on pro rata basis.

d) Revenue Recognition:

Revenue from sales of goods is recognized when risk and rewards in respect of ownership of goods are transferred to the customers and no significant uncertainty exists regarding the amount of consideration that is derived from the sale of goods.

Revenue from sales of products is stated exclusive of Returns, Sales TaxA^AT, and applicable rebates & discounts as per policy of the Company.

Insurance claims are booked on the basis of best estimates/loss as surveyed/assessed.

Interest income is accounted for on accrual basis.

e) Inventories:

- Inventories of raw materials, packing materials and work in progress (WIP) are valued at the lower of cost (net of CENVAT) and net realizable value on First in First out basis.

- Finished Goods are valued at the lower of cost (including overheads and excise duty) or net realizable value.

- Costs are generally calculated at standards adjusted to actual in case of raw materials & packing materials & in the case of manufactured inventories & the work in progress (WIP) same is valued at cost. The finished goods cost includes cost of conversion and other cost incurred in bringing the inventories to their present location and condition.

- Excise duty in respect of closing inventory of finished goods is included as a part of inventory.

- CENVAT credits in respect of raw materials consumed and packing materials used for manufacture of goods is deducted from the cost of raw materials and packing materials consumed in the production of finished goods.

f) Foreign Currency Transactions:

(i) Initial Recognition:

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion:

At the year end, monetary items denominated in the foreign currencies are converted into equivalent rupee value by applying prevalent exchange rates at the year end.

(iii) Exchange Differences:

All the exchange differences arising on settlement / reinstatement of foreign currency transactions are adjusted in the Profit and Loss Account, except in cases where they relate to the acquisition of fixed assets acquired from outside India, in that case they are adjusted in the cost of the corresponding assets.

(iv) Forward Exchange Contracts not intended for trading or speculation purposes:

The Companys derivative instruments comprise of forward exchange contracts which are not intended for trade or speculation purposes. In respect of Derivative contracts, provision for losses on restatement and gains/losses on settlement are recognized along with the underlying transaction and charged to Profit and Loss Account.

g) Investments:

Unquoted Shares are valued at cost.

h) Employee Benefits:

i) Defined Contribution Plans:

The Company has Defined Contribution plans for post employment benefits namely Provident Fund and Superannuation Fund which are administered through appropriate authorities.

The Company contributes to a Government administered Provident Fund, Employees Deposit Linked Insurance Scheme and Family Pension Fund on behalf of its employees and has no further obligation beyond making its contribution.

The Superannuation Fund applicable to certain employees is a defined contribution plan as the Company makes contributions to Officers Superannuation Scheme which is administered by an insurance Company and has no further obligation beyond making the payment to the insurance Company.

The Company makes contributions to State plans namely Employees State Insurance Fund and has no further obligation beyond making payment to them.

The Companys contributions to the above funds are charged to revenue every year.

ii) Defined Benefit Plans:

The Company has a Defined Benefit Plan namely Gratuity covering its employees. The gratuity scheme is funded through Group Gratuity-cum- Life Assurance Scheme and the liability for the defined benefit plan of Gratuity and Pension is provided based on an actuarial valuation at the year-end.

(iii) Termination benefits are recognized as an expense as and when incurred.

(iv) Other Employee Benefits:

The employees of the Company are entitled to leave encashment and long service awards as per the policy of the Company. The liability in respect of the same is provided, based on an actuarial valuation carried out by an independent actuary at the year-end.

(i) Taxes on Income:

Provision for Income Tax comprises of current tax,

deferred tax charge or release. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961.

Deferred Tax is recognized, subject to consideration of prudence, on timing differences, being difference between taxable and accounting income and expenditure that originate in one period and are capable of reversal in one or more subsequent period (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 assets will be realized.

(j) Provisions and Contingencies:

Provision, Contingent Liabilities and Contingent

Assets:

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation.

A disclosure for a contingent liability is made when there is possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure as specified in Accounting Standard 29 -"Provisions, Contingent Liabilities and Contingent Assets" is made.

Contingent Assets are not recognised in the financial statements.

k) Earnings Per Share (EPS)

The earnings considered in ascertaining the Companys EPS comprises the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the year.

Dilutive potential equity shares are deemed to be converted as of the beginning of the year, unless they have been issued at a later date. The number of shares used for computing the diluted EPS is the weighted average number of shares outstanding during the year after considering the dilutive potential equity shares.


Mar 31, 2010

A) Basis of Accounting:

The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting with the accounting principles generally accepted in India (GAAP) and comply with the mandatory Accounting standards (AS) issued by the Institute of Chartered Accountants of India to the extent applicable and with the relevant provisions of the Companies Act, 1956.

b) Fixed Assets:

Fixed Assets are stated at cost of acquisition (net of CENVAT, wherever applicable), less accumulated depreciation till the end of Financial Year. Cost is inclusive of freight, duties, levies, installation expenses and any directly attributable cost of bringing the assets to their working condition for intended use which are capitalized till the assets are ready to be put to use.

c) Depreciation:

Depreciation on fixed assets is provided on written down value method (WDV) at the rate and in the manner prescribed in schedule XIV to the Companies Act,1956 .On the addition of the assets depreciation have been provided from the day on which the asset was actually put to use. Depreciation in case of disposal/sale of assets is provided upto the date of disposal/sale of assets on pro rata basis.

d) Revenue Recognition:

Revenue from sales of goods is recognized when risk and rewards in respect of ownership of goods are transferred to the customers. Revenue from sales of products is stated exclusive of returns, Sales Tax/VAT, and applicable rebates & discounts as per policy of the Company. Insurance claims are booked on the basis of best estimates/loss as surveyed/ assessed.

e) Inventories:

Inventories of raw materials, packing materials and work in progress (WIP) are valued at the lower of cost (net of CENVAT) and net realizable value on First in First out basis.

Finished Goods are valued at the lower of cost (including overheads and excise duty) or net realizable value.

Costs are generally calculated at standards adjusted to actual in case of raw materials, packing materials; in the case of manufactured inventories , WIPs valued at cost .Finished goods cost includes cost of conversion and other cost incurred in bringing the inventories to their present location and condition.

Excise duty in respect of closing inventory of finished goods is included as a part of inventory.

CENVAT credits in respect of raw materials consumed and packing materials used for manufacture of Goods is deducted from the cost of raw materials and packing materials consumed in the production of finished goods.

f) Foreign Currency Transactions:

(i) Initial Recognition :

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion :

At the year end, monetary items denominated in the foreign currencies are converted into equivalent rupee value by applying prevalent exchange rates at the year end.

(iii) Exchange Differences:

All the exchange differences arising on settlement / reinstatement of foreign currency transactions are adjusted in the Profit and Loss Account, except in cases where they relate to the acquisition of fixed assets acquired from outside India, in which case they are adjusted in the cost of the corresponding assets.

(iv) Forward Exchange Contracts not intended for trading or speculation purposes

The Companys derivative instruments comprises of forward exchange contracts which are intended for trade or speculation purposes. In respect of Derivatives contracts, provision for losses on restatement and gains/losses on settlement are recognized along with the underlying transaction and charged to Profit and Loss Account.

g) Investments:

Unquoted Shares are valued at cost.

h) Retirement Benefits:

The Company has floated various Schemes of retirement benefits for the welfare of employees, which comprise payments under approved Provident Fund Plans, Leave Encashment and Gratuity to eligible employees. Payments under approved Provident Funds plans are charged to revenue. Liability in respect of Leave Encashment is provided as per the policy of the Company on accrual basis. The gratuity liability is provided and charged off as revenue expenditure based on actuarial valuation.

(i) Taxes on Income:

Provision for Income Tax comprises of current tax, deferred tax charge or release. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961.

Deferred Tax is recognized, subject to consideration of prudence, on timing differences, being difference between taxable and accounting income and expenditure that originate in one period and are capable of reversal in one or more subsequent period(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 assets will be realized.

(j) Provisions and Contingencies:

Contingent liabilities are estimated on the basis of available information and are disclosed by way of notes on accounts. These are reviewed at each Balance Sheet date and adjusted to reflect the current Management estimates.

k) Earnings Per Share (EPS)

The earnings considered in ascertaining the Companys EPS comprises the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the year.

Dilutive potential equity shares are deemed to be converted as of the beginning of the year, unless they have been issued at a later date. The number of shares used for computing the diluted EPS is the weighted average number of shares outstanding during the year after considering the dilutive potential equity shares.

l) Deferred Revenue Expenditure:

Revenue expenditure where benefit is expected to accrue over a longer period is amortized equally over a period of 5 years.

 
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