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Accounting Policies of Elango Industries 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 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014 and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied.

B. USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, and the useful lives of tangible assets and intangible assets. - Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the consolidated financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes.

C. CASH FLOW STATEMENT

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of non-cash nature and defferals and accruals of past or future cash receipts or payments.

Cash & cash equivalent comprises cash on hand and deposit with financial insitutions, highly liquid investments which are readily convertible into cash.

D. IMPAIRMENT OF ASSETS

An asset is concerned as impaired in accordance with Accounting Standard 28 on 'Impairment of Assets", when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exists is recoverable amount (i.e. the higher of the asset's net selling price and value in use). The assets of the company are considered impaired and no Impairment loss has been recognised in the financial statements.

E. CONTINGENT LIABILITY

Contingent liabilities as defined in accounting standard 29 on "provisions, contingent liabilities and contingent assets" are disclosed by way of notes to the accounts. Provision is made if it is probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. There were no transactions covered under this category and no provision has been made during this year.

F. ACCOUNTING FOR TAXES ON INCOME

Income taxes are accounted for in accordance AS 22 "Accounting for Taxes and Income" issued by the ICAI. Tax expense comprises both current and deferred tax. Current tax is measured at the amount expected to be paid to/ recovered from the tax authorities using the applicable tax rates. Deferred tax assets and liabilities are recognized for future tax consequences attributable to timing difference between taxable income and accounting income that are capable of reversing in or more subsequent periods and or measured using relevant enacted tax rates. At each Balance Sheet, the Company reassesses unrecognized deferred tax assets to the extent they have become reasonably certain or virtually certain of realization, as the case may be.

G. EMPLOYEE BENEFITS Defined Contribution Plan

As there are less number of employees on the roll of company, the company has not devised any recognised contribution plan.

H. FOREIGN CURRENCY TRANSACTION

There is no foreign currency transaction during the financial year 2014-15, hence there is no exchange difference.

I. SEGMENT REPORTING

As The Company has closed down its operation, there are no separate reportable segments as per Accounting Standard (AS) 17 "Segment Reporting "


Mar 31, 2014

BASIS OF ACCOUNTING

The Financial Statements have been prepared under historical cost convention on accrual basis and comply with notified accounting standards as referred to in Section 211(3C) and other relevant provisions of the Companies Act,1956.

All assets and liabilities have been classsified as current or non-current as per the company’s normal operating cycle and other criteria set out in Revised Scheule VI to the Companies Act, 1956 Based on the nature of the services and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as twelve months for the purpose of current and non-current clasification of assets and liabilities.

USE OF ESTIMATES

The preparation of the financial statements in conformity with the accounting standards generally accepted in India requires the management to make estimates that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates.

The Company is a Small and Medium Sized Company (SMC) as defined in the general instructions in respect of accounting standards notified under the companies Act 1956. Accordingly, the company has compiled with the accounting standards as applicable to a Small and Medium Sized Company.

VALUATION OF INVENTORY

The company does not have any Inventory as on 31.3.2014.

IMPAIRMENT OF ASSETS

An asset is concerned as impaired in accordance with Accounting Standard 28 on ‘Impairment of Assets", when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exists is recoverable amount (i.e. the higher of the asset’s net selling price and value in use). There were no reduction or gain against the carrying amount to the recoverable amount and no effect for the impairment is recognized in the profit and loss account.

CONTINGENT LIABILITY

Contingent liabilities as defined in accounting standard 29 on "provisions, contingent liabilities and contingent assets" are disclosed by way of notes to the accounts. Provision is made if it is probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. There were no transactions covered under this category and no provision has been made during this year.

ACCOUNTING FOR TAXES ON INCOME

Income taxes are accounted for in accordance AS 22 "Accounting for Taxes and Income issued by the ICAI. Tax expense comprises both current and deferred tax. Current tax is measured at the amount expected to be paid to/ recovered from the tax authorities using the applicable tax rates. Deferred tax assets and liabilities are recognized for future tax consequences attributable to timing difference between taxable income and accounting income that are capable of reversing in or more subsequent periods and or measured using relevant enacted tax rates. At each Balance Sheet, the Company reassesses unrecognized deferred tax assets to the extent they have become reasonably certain or virtually certain of realization, as the case may be.

EMPLOYEE BENEFITS

Defined Contribution Plan

The Company has defined contribution plans for employees. But there are no permanent employees during the financial year. Hence there is no Contributions Paid/Payable to these plans during the financial year.

FOREIGN CURRENCY TRANSACTION

There is no foreign currency transaction during the financial year 2013-14, hence there is no exchange difference.

SEGMENT REPORTING

As The Company has closed down its operation, there are no separate reportable segments as per Accounting Standard (AS) 17 "Segment Reporting".

EARNINGS PER SHARE:

Basic/Diluted earnings per share is calculated by dividing the net profit/loss for the year attributable to equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding as at the end of the year. As there were no shares considered as dilutive, same denominator as applicable for Basic EPS has been used for computing the dilutive Earnings Per Share

In the opinion, of the Board of Directors and to the best of their Knowledge and belief, the value on realization of Current Assets, Loans and Advances in the ordinary course of business will not be less than the amount at which they are stated in the Balance sheet.

Confirmation of Balances from certain parties for the amounts due to them or due from them is yet to be received / reconciled.

The timing differences related mainly to depreciation and unabsorbed losses and the net effect of such differences will result in deferred tax asset or liability. The company has not earned any taxable income hence as a measure of prudence net deferred tax asset relating to the above period has not been recognized in the accounts.

Since there is no tax liability, no Provision for Income Tax has been made in the books of accounts as per the provisions of the Income Tax Act.


Mar 31, 2012

BASIS FOR PREPARATION OF FINANCIAL STATEMENTS BASIS OF ACCOUNTING

The Financial Statements have been prepared under historical cost convention on accrual basis and comply with notified accounting standards as referred to in Section 211(3C) and other relevant provisions of the per the Companies Act, 1956.

All assets and liabilities have been classsified as current or non-current as per the company's normal operating cycle and other criteria set out in Revised Scheule VI to the Companies Act, 1956. Based on the nature of the services and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as twelve months for the purpose of current and non-current clasification of assets and liabilities.

USE OF ESTIMATES

The preparation of the financial statements in conformity with the accounting standards generally accepted in India requires the management to make estimates that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates.

The Company is a Small and Medium sized company (SMC) as defined in the general instructions in respect of accounting standards notified under the companies Act 1956. Accordingly, the company has compiled with the accounting standards as applicable to a Small and Medium Sized Company.

VALUATION OF INVENTORY

The company does not have any Inventory as on 31.3.2012.

IMPAIRMENT OF ASSETS

An asset is concerned as impaired in accordance with Accounting Standard 28 on 'Impair- ment of Assets", when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exists is recoverable amount (i.e. the higher of the asset's net selling price and value in use). There were no reduction or gain against the carrying amount to the recoverable amount and no effect for the impairment is recognized in the profit and loss account.

CONTINGENT LIABILITY

Contingent liabilities as defined in accounting standard 29 on "provisions, contingent liabilities and contingent assets" are disclosed by way of notes to the accounts. Provision is made if it is probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. There were no transactions covered under this category and no provision has been made during this year.

ACCOUNTING FOR TAXES ON INCOME

Income taxes are accounted for in accordance AS 22 "Accounting for Taxes and Income" issued by the ICAI. Tax expense comprises both current and deferred tax. Current tax is measured at the amount expected to be paid to/ recovered from the tax authorities using the applicable tax rates. Deferred tax assets and liabilities are recognized for future tax consequences attributable to timing difference between taxable income and accounting income that are capable of reversing in or more subsequent periods and or measured using relevant enacted tax rates. At each Balance Sheet, the Company reassesses unrec- ognized deferred tax assets to the extent they have become reasonably certain or virtu- ally certain of realization, as the case may be.

EMPLOYEE BENEFITS

Defined Contribution Plan

The Company has defined contribution plans for employees. But there are no permanent employees during the financial year. Hence there is no Contributions Paid/Payable to these plans during the financial year.

FOREIGN CURRENCY TRANSACTION

There is no foreign currency transaction during the financial year 2011-12, hence there is no exchange difference.

SEGMENT REPORTING

As The Company has closed down its operation, there are no separate reportable seg- ments as per Accounting Standard (AS) 17 "Segment Reporting "

In the opinion, of the Board of Directors and to the best of their knowledge and belief, the value on realization of Current Assets, Loans and Advances in the ordinary course of business will not be less than the amount at which they are stated in the Balance sheet.

Confirmation of Balances from certain parties for the amounts due to them or due from them is yet to be received / reconciled.

For the year ended on March 31, 2012, the company has not generated any sales revenue from the Plant & Machinery capable of manufacturing 13000 tons P.A of Steel Ingots from Metal Scraps during the financial year 2011-12 but earned only exempted dividend income from the investment in shares of companies.

The timing differences related mainly to depreciation and unabsorbed losses and the net effect of such differences will result in deferred tax asset or liability. The company has not earned any taxable income hence as a measure of prudence net deferred tax asset relating to the above period has not been recognized in the accounts.

Since there is no tax liability, no Provision for Income Tax has been made in the books of accounts as per the provisions of the Income Tax Act.

MANAGERIAL REMUNERATION

Payment of Managerial Remuneration and other benefits inclusive of perquisites not made to the Managing Director and Director against their option.

MICRO, MEDIUM & SMALL ENTERPRISES ACT, 2006.

In spite of the absence of a database identifying Creditors as Small Scale industrial Undertakings, it is the opinion of the management that there are no parties, which can be classified as Small Scale industrial Undertaking to whom the Company owes any sum. The Auditors have accepted the representation of the management in this matter.

As per the Business Plan prepared by the Management, they are exploring the possibilities to revive the manufacturing activities along with the present investment of surplus funds into the diversified projects.

According to the information and explanation given to us, we are of the opinion that the changes in the Fixed Assets have not affected the going concern status of the company.

Figures shown in the accounts have been rounded off to the nearest rupee.


Mar 31, 2010

1) BASIS FOR PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under Historical Cost Convention on Accrual Basis of accountings.

2) USE OF ESTIMATES

The preparation of the financial statements in conformity with the accounting standards generally accepted in India requires the management to make estimates that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates.

3) The Company is a Small and Medium sized company (SMC) as defined in the general instructions in respect of accounting standards notified under the companies Act 1956. Accordingly, the company has compiled with the accounting standards as applicable to a Small and Medium Sized Company.

4) FIXED ASSETS

Expenditure which are of a capital nature are capitalized at cost, which comprises of purchase price of materials, labour, consultancy charges and directly attributable cost of bringing the assets to its working conditions for the intended use

5) DEPRECIATION

Depreciation is provided on written down value basis as per the rates prescribed under Schedule XIV of the companies Act, 1956.

6) VALUATION OF INVENTORY

The company does not have any Inventory as on 31.3.2010.

7) IMPAIRMENT OF ASSETS

An asset is concerned as impaired in accordance with Accounting Standard 28 on Impairment of Assets", when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exists is recoverable amount (i.e. the higher of the assets net selling price and value in use). There were no reduction or gain against the carrying amount to the recoverable amount and no effect for the impairment is recognized in the profit and loss account.

8) REVENUE RECOGNITION

Dividend income is recognized on receipt basis

9) CONTINGENT LIABILITY

Contingent liabilities as defined in accounting standard 29 on "provisions, contingent liabilities and contingent assets" are disclosed by way of notes to the accounts. Provision is made if it is probable that an outflow of future economic benefits will be required for an item previously dealt with as a contingent liability. There were no transactions covered under this category and no provision has been made during this year.

10) ACCOUNTING FOR TAXES ON INCOME

Income taxes are accounted for m accordance AS 22 "Accounting for Taxes and Income" issued by the ICAI. Tax expense comprises both current and deferred tax. Current tax is measured at the amount expected to be paid to/ recovered from the tax authorities using the applicable tax rates. Deferred tax assets and liabilities are recognized for future tax consequences attributable to timing difference between taxable income and accounting income that are capable of reversing in or more subsequent periods and or measured using relevant enacted tax rates. At each Balance Sheet, the Company reassesses unrecognized deferred tax assets to the extent they have become reasonably certain or virtually certain of realization, as the case may be.

11) EMPLOYEE BENEFITS

Defined Contribution Plan

The Company has defined contribution plans for employees. But there are no permanent employees during the financial year. Hence there is no Contributions Paid/Payable to these plans during the financial year.

12) INVESTMENT

The investment of Rs.2,50,000/- in the Equity Shares of "M/s.Kaveri Gas Power Limited" and investment of Rs.3,03,80,000/- in the Preference Shares of "M/s.Kaveri Gas Power Limited", under the same management whose shares are unquoted are valued at cost. The Management is of the opinion that there is no diminishing value on these Investments.

13) FOREIGN CURRENCY TRANSACTION

There is no foreign currency transaction during the financial year 2009-10 hence there is no exchange differences.

14) SEGMENT REPORTING

The Company is engaged primarily in the business of manufacturing steel Ingots from the scrap materials and there are no separate reportable segments as per Accounting Standard (AS) 17 "Segment Reporting "

15) RELATED PARTY TRANSACTION

In accordance with Accounting standard (AS) 18, the disclosures required as given below:

17) DISCONTINUED OPERATIONS (PURSUANT TO AS 24):

1. Discontinued since : 01.08.2003

2. Segment : Primarily Manufacturing of Steel Ingots

3. Carrying amount of total assets : Rs.57,383,987/-

4. Carrying amount of total liabilities : Rs.1,04,423/-

5. Profit from ordinary activities : NIL

6. Income Tax expenses : NIL

7. Gain on Disposal of Assets : NIL

8. Cash flow from discontinued operations:

Operating activities

Investing activities : NIL

Financial activities

 
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