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Accounting Policies of Emmsons International Ltd. Company

Mar 31, 2015

1 Corporate Information:

The Company is engaged in Trading of Agro/Energy Commodities having global presence. The commodities traded include Rice, Wheat, Sugar, Maize, Soya meal, Barley, Pulses, Coal ,Garment and Textile Products .The company has maintained long and sustained relationships with its clients across the globe due to its quality products and efficient services.

(a) 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 referred to in Section 133 of the Companies Act 2013 read with rule 7 of the Companies (Accounts) Rules , 2014. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

(b) Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

(c) Cash and cash equivalents

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

(d) Cash flow statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

(e) Tangible fixed assets

Tangible Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of tangible fixed assets. Capital work in progress includes assets that are not ready for their intended use and are carried at cost and their related incidental expenses.

(f) Intangible fixed assets

Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of intangible fixed assets.

(g) Depreciation and amortization

Depreciation on fixed assets is provided in accordance with the requirement of Schedule II of Companies Act 2013, except on intangible assets. Amortization on intangible assets has been provided in compliance of Accounting Standard AS-26.

(h) Revenue Recognition

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax. The Export Sale is recognized at the time of issuance of Bill of Lading. Interest income is recognized on an accrual basis on time proportionate basis, based on interest rates implicit in the transaction. Dividend income is recognized on receipt basis.

(i) Taxes on income

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

(j) Foreign Currency Transactions

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the balance Sheet date is recognized as per Accounting Standard (AS) -11 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

(k) Inventories

Items of Inventories are valued at cost or net realizable value, whichever is lower using FIFO method.

(l) Investments

Long term investments are stated at cost less provision for other than temporary diminution in value. Current investments are stated at lower of cost and fair value.

(m) Provisions and contingencies

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

(n) Employee benefit

(i) Short–term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered. (ii) Defined Benefit Plans:

- Leave Salary of employees on the basis of actuarial valuation as per AS 15.

- Gratuity Liability on the basis of actuarial valuation as per AS 15. (iii) Defined Contribution Plans:

Provident fund & ESI on the basis of actual liability accrued and paid to authorities.

(o) Export benefit/ incentives

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

(p) Earning per share

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.


Mar 31, 2014

(a) 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 have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

(b) Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

(c) Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

(d) Cash flow statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

(e) Tangible fixed assets

Tangible Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any.The company has capitalized all costs relating to acquisition and installation of tangible fixed assets. Capital work in progress includes assets that are not ready for their intended use and are carried at cost and their related incidental expenses.

(f) Intangible fixed assets

Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of intangible fixed assets.

(g) Depreciation and amortization

Depreciation on fixed assets is provided using straight-line method at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956, except on intangible assets, which are not specified in the above schedule. Amortization on intangible assets has been provided in compliance of Accounting Standard AS-26.

(h) Revenue Recognition

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax.The Export Sale is recognized at the time of issuance of Bill of Lading. Interest income is recognized on an accrual basis on time proportionate basis, based on interest rates implicit in the transaction. Dividend income is recognized on receipt basis.

(i) Taxes on income

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

(j) Foreign Currency Transactions

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the balance Sheet date is recognized as per Accounting Standard (AS) -1 1 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

(k) Inventories

Items of Inventories are valued at cost or net realizable value, whichever is lower.

(l) Investments

Long term investments are stated at cost less provision for other than temporary diminution in value. Current investments are stated at lower of cost and fair value.

(m) Provisions and contingencies

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

(n) Employee benefit

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

(ii) Defined Benefit Plans:

- Leave Salary of employees on the basis of actuarial valuation as per AS 15.

- Gratuity Liability on the basis of actuarial valuation as per AS 15.

(iii) Defined Contribution Plans:

Provident fund & ESI on the basis of actual liability accrued and paid to authorities.

(o) Export benefit/ incentives

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

(p) Earning per share

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.

(q) Recognition of prior period expenses

Prior period expenses and incomes below Rs.20000/- are treated as current year''s expenses / incomes.


Mar 31, 2013

(a) 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 have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

(b) Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

(c) Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

(d) Cash flow statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

(e) Tangible fixed assets

Tangible Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of tangible fixed assets. Capital work in progress includes assets that are not ready for their intended use and are carried at cost and their related incidental expenses.

(f) Intangible fixed assets

Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of intangible fixed assets.

(g) Depreciation and amortization

Depreciation on fixed assets is provided using straight-line method at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956, except on intangible assets, which are not specified in the above schedule. Amortization on intangible assets has been provided in compliance of Accounting Standard AS-26.

(h) Revenue Recognition

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax. The Export Sale is recognized at the time of issuance of Bill of Lading.

Interest income is recognized on an accrual basis on time proportionate basis, based on interest rates implicit in the transaction.

Dividend income is recognized on receipt basis.

(i) Taxes on income

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

(j) Foreign Currency Transactions

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost.. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the balance Sheet date is recognized as per Accounting Standard (AS) -11 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

(k) Inventories

Items of Inventories are valued at cost or net realizable value, whichever is lower.

(l) Investments

Long term investments are stated at cost less provision for other than temporary diminution in value. Current investments are stated at lower of cost and fair value.

(m) Provisions and contingencies

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

(n) Employee benefit

(i) Short–term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

(ii) Defined Benefit Plans:

- Leave Salary of employees on the basis of actuarial valuation as per AS 15.

- Gratuity Liability on the basis of actuarial valuation as per AS 15.

(iii) Defined Contribution Plans:

Provident fund & ESI on the basis of actual liability accrued and paid to authorities.

(o) Export benefit/ incentives

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

(p) Earning per share

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.

(q) Recognition of prior period expenses

Prior period expenses and incomes below Rs.20000/- are treated as current year''s expenses / incomes.


Mar 31, 2012

(a) 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 have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

(b) Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

(c) Tangible fixed assets

Tangible Fixed assets are carried at cost less accumulated depreciation. The company has capitalized all costs relating to acquisition and installation of tangible fixed assets.

(d) Intangible fixed assets

Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. The company has capitalized all costs relating to acquisition and installation of intangible fixed assets.

(e) Depreciation

Depreciation on fixed assets is provided using straight-line method at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956, except on intangible assets, which are not specified in the above schedule. Amortization on intangible assets has been provided in compliance of Accounting Standard AS-26.

(f) Revenue Recognition

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax. The Export Sale is recognized at the time of issuance of Bill of Lading. Interest income is recognized on an accrual basis on time proportionate basis, based on interest rates implicit in the transaction. Dividend income is recognized on receipt basis.

(g) Accounting for taxes on income

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

(h) Foreign Currency Transactions

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the balance Sheet date is recognized as per Accounting Standard (AS) -11 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

(i) Inventories

Items of Inventories are valued at cost or net realizable value, whichever is lower.

(j) Investments

Long term investments are stated at cost less provision for other than temporary diminution in value. Current investments are stated at lower of cost and fair value.

(k) Provisions and contingencies

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

(l) Employee benefit

(i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

(ii) Defined Benefit Plans:

- Leave Salary of employees on the basis of actuarial valuation as per AS 15.

- Gratuity Liability on the basis of actuarial valuation as per AS 15.

(iii) Defined Contribution Plans:

Provident fund & ESI on the basis of actual liability accrued and paid to authorities.

(m) Export benefit/ incentives

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

(n) Earning per share

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.

(o) Recognition of prior period expenses

Prior period expenses and incomes below Rs.20000/- are treated as current year's expenses / incomes.


Mar 31, 2011

1. BASIS OF ACCOUNTING

The Financial Statements have been prepared to comply with the Mandatory Accounting Standards issued by The Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The Financial Statements have been prepared under the historical cost convention on accrual basis. The Accounting Policies have been consistently applied by the Company unless otherwise stated.

2. REVENUE RECOGNITION

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax. The Export Sale is recognized at the time of issuance of Bill of Lading.

Interest income is recognized on an accrual basis on time proportionate basis, based on interest rates implicit in the transaction.

Dividend income is recognized on receipt basis.

3. ACCOUNTING FOR TAXES ON INCOME

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

4. FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the Balance Sheet date is recognized as per Accounting Standard (AS) -11 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

5. FIXED ASSETS

Fixed Assets are stated at cost less accumulated depreciation. The company has capitalized all costs relating to acquisition and installation of fixed assets.

6. DEPRECIATION

Depreciation on fixed assets is provided using straight-line method at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956, except on intangible assets, which are not specified in the above schedule. Amortization on intangible assets has been provided in compliance of Accounting Standard AS-26.

7. INVENTORIES

Items of Inventories are valued at cost or net realizable value, whichever is lower.

8. RETIREMENT BENEFITS

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

2) Defined Benefit Plans:

- Leave Salary of employees on the basis of actuarial valuation as per AS 15.

- Gratuity Liability on the basis of actuarial valuation as per AS 15. 3) Defined Contribution Plans:

Provident fund & ESI on the basis of actual liability accrued and paid to authorities.

iii) Change in Plan Assets: There is no change in Plan Assets in the case of Gratuity and Leave Encashment because there is no funded scheme taken by the Company.

v) Actuarial Assumptions:

1) Demographic assumptions: As shown in para 18(i) of the report.

2) Financial Assumptions:

The estimate of future salary increase takes into account regular increment, promotional increases and other relevant factors such as supply and demand in the employment market.

9. EXPORT BENEFITS/ INCENTIVES

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

10. EARNINGS PER SHARE

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.

11. RECOGNITION OF PRIOR PERIOD ITEMS

Prior period expenses and incomes below Rs.15000/- are treated as current year's expenses / incomes.


Mar 31, 2010

1. BASIS OF ACCOUNTING

The Financial Statements have been prepared to comply with the Mandatory Accounting Standards issued by The Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The Financial Statements have been prepared under the historical cost convention on accrual basis. The Accounting Policies have been consistently applied by the Company unless otherwise stated.

2. REVENUE RECOGNITION

The accrual basis of accounting has been followed in respect of income and expenditure. Sales figures are net of sales tax. The Export Sale is recognized at the time of issuance of Bill of Lading.

3. ACCOUNTING FOR TAXES ON INCOME

The Deferred tax expense or benefit is recognized on timing differences being the difference between taxable incomes and accounting incomes that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

4. FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency transactions during the year are recorded at the rate of exchange prevailing on the date of transaction. Foreign Currency monetary assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet except investment in shares of subsidiary company which has been carried at historic cost. All Exchange differences are dealt with in the Profit and Loss Account except for investment in overseas subsidiary. Foreign Currency monetary items are reported using the closing rate.

(ii) Where the company has entered into forward exchange contracts, the difference between the forward rate and spot rate at the date of the contract is recognized in the statement of the profit and loss over the life of the contract and difference between the spot rate at the date of contract and the exchange rate prevailing on the balance Sheet date is recognized as per Accounting Standard (AS) -11 (Revised) issued by the Institute of Chartered Accountants of India. Any Profit or Loss arising on cancellation or renewal of forward exchange contract is recognized as Income or as expenses for the year.

5. FIXED ASSETS

Fixed Assets are stated at cost less accumulated depreciation. The company has capitalized all costs relating to acquisition and installation of fixed assets.

6. DEPRECIATION

Depreciation on fixed assets is provided using straight-line method at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956, except on intangible assets, which are not specified in the above schedule. Depreciation on intangible assets has been provided in compliance of Accounting Standard AS-26.

7. inventories!

Items of Inventories are valued at cost or net realizable value, whichever is lower.

8. RETIREMENT BENEFITS

Liability of Gratuity at retirement/cessation and Leave Encashment is provided for based on valuations, as at the Balance Sheet date, made by independent actuaries as per Accounting Standard (AS)-15 (Revised) issued by the Institute of Chartered Accountants of India.

9. EXPORT BENEFITS/ INCENTIVES

Export Entitlements in respect of the exports made under various scheme are recognized in the Profit and Loss Account when the right to receive credit as per the terms of the Schemes are established.

10. EARNINGS PER SHARE

Basic Earnings per share are 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. Diluted Earnings per share are not different from basic earning per share.

11. RECOGNITION OF PRIOR PERIOD ITEMS

Prior period expenses and incomes below Rs.15000/- are treated as current years expenses / incomes.

 
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