Accounting Policies of Galaxy Agrico Exports Ltd. Company

Mar 31, 2015

A. Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standard specified under section 133 of the Companies Act,2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 as applicable.

B. Use of estimates .

The preparation of Financial Statements requires estimates and assumptions to be made that affect

the reported amount of assets and liabilities (including Contingent Liabilities) on the date of the Financial Statements and the reported amount of revenues and expenses during the reporting period.

Estimates and Assumptions used in the preparation of the Financial Statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the Financial Statements, which may differ from the actual results at a subsequent date.

Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

C Fixed assets

Fixed Assets are stated at cost net of recoverable taxes less accumulated depreciation, except free hold land which is carried at cost. The cost of fixed assets comprises of its purchase price, freight charges, adjustments arising from exchange rate variations, and all incidental expenditure attributable to bringing the asset to their working conditions for its intended use.

D. Depreciation

Depreciation on fixed assets is provided on Written Down Value method at the rate and in the manner prescribed in Schedule II of the Companies Act,2013.

Depreciation on addition to fixed assets is provided on pro-rata basis from the date of acquisition / installation / when the asset is put to use. In respect of asset sold or disposed off during the year, depreciation is provided till the date of sale/disposal/adjustment of the assets. /

E. Impairment of Asset

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Statement of Profit & Loss in the year in which an asset is identified as impaired.

F. Investments

Long-term Investments are stated at cost less amount written off, where there is a diminution in its value of long-term nature.

G. Inventories

Inventories are valued at cost and net realizable value whichever is lower, as certified by the management of the Company.

Cost of Inventories comprise of all cost of purchase, conversion and other cost incurred in bringing the inventories to their present location and condition.

H. Revenue Recognition

Sales are recognised on dispatch of goods to customers.

job work Income is recognised upon completion of the job and ready for delivery as there is no significant uncertainty in ultimate collection.

Other operating income comprises of income from ancillary activities incidental to the operations of the Company and is recognised when the right to receive the income is established as per the terms of the contract.

Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

I. Foreign Currency Transactions

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing at the time of the transaction.

Transactions in foreign currencies are recognized at the prevailing exchange rates on the transaction dates. Realized gains and losses on settlement of foreign currency transactions are recognized in Statement of Profit & Loss. Foreign currency assets and liabilities at the year-end are translated at the year-end exchange rates, and the resultant exchange difference is recognized in the Statement of Profit & Loss.

3. Employee Benefits

Short-term employee benefits

Short-term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered.

Defined Contribution Plans

Contribution to provident fund is charged to the Statement of Profit and Loss for the year in which it becomes due.

Gratuity at present is being charged to the Statement of Profit and Loss in the year in which the payment is made to the employee.

K. Income Tax

Current Tax: Provision is made for income tax on yearly basis, under the tax-payable method, based on tax liability, as computed after taking credit for allowances and exemptions as per Income Tax Act, 1961.

Deferred Tax. Deferred tax liability or assets is recognized on timing differences being the difference between taxable income and accounting income 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.

Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized only to the extent that there is virtual certainty that sufficient taxable income will be available to realize these assets. All other deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available to realize these assets.

L. Prior Period Items

Material items of prior period expenses, non-recurring and extra-ordinary items are disclosed separately.

M. Provisions,

Provisions involve substantial degree of estimation in measurement and are recognized where there is a present obligation as a result of past events and it is probable that there will be an outflow of resources embodying economic benefits. These are reviewed at each balance sheet date to reflect the current best estimate.

N. Contingent Liabilities and Contingent Assets

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future event beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources embodying future economic benefits will be required to settle the obligation. The company does not recognize a contingent liability but discloses its existence in the financial statement.

Contingent assets are neither recognized nor disclosed in the financial statements following the principal of conservatism.

O. Cash Flow Statements

Cash flow statement is reported using Indirect method, whereby Profit / (Loss) before tax is adjusted for the effects of transaction of non-cash in nature and any deferrals or accruals of past or future cash receipts or payments. The cash flow from operating, Investing and financing activities of the company are segregated based on available information. Cash and cash equivalents for the purpose of cash flow statement comprise cash at bank and in hand and short-term investment with original maturity of three months or less.

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Mar 31, 2014

Company Profile:

The company is engaged in manufacturing and trading activity and has two business segments, viz. Agricultural Equipments and Bearings (Forged Rings). It trades in Agricultural Equipments while manufactures as well as does job work of Bearings,

A. Basis of preparation of financial statements

The Financial Statements nave been prepared under the historical cost convention on the accrual basis of accounting in accordance with accounting principles generally accepted in India (’Indian GAAP'') and comply with the Accounting Standards notified under section 211(3C) of Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. The accounting policies have been consistently applied by the entity.

B. Use of estimates

The preparation of Financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities (including Contingent Liabilities) on the date of the Financial Statements and the reported amount of revenues end expenses during the reporting period.

Estimates and Assumptions used in the preparation of the Financial Statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the Financial Statements, which may differ from the actual results at a subsequent date.

Difference between the actual results and estimates are recognized in the period in which the results are known / materialized,

C. Fixed assets

Fixed Assets are stated at cost net of recoverable taxes less accumulated depreciation, except free hold land which is carried at cost. The cost of fixed assets comprises of its purchase price, freight, charges, adjustments arising from exchange rate variations, and all incidental expenditure attributable to bringing the asset to their working conditions for its intended use.

D. Depreciation

Depreciation on fixed assets is provided on Written Down Value method at the rate and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

Depreciation on addition to fixed assets is provided on pro-rata basis from the date of acquisition / installation / when the asset is put: to use. In respect of asset sold or disposed off during the year, depreciation is provided till the date of sale/disposal/adjustment of the assets

E. Impairment of Asset

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Statement of Profit & Loss in the year in which an asset is identified as impaired.

F. Investments

Long-term Investments are stated at cost less amount written off, where there is a dimention in its value of long-term nature.

G. Inventories

Inventories are valued at cost and net realizable value whichever is lower, as certified by the management of the Company.

Cost of Inventories comprise of all cost of purchase, conversion and other cost incurred In bringing the inventories to their present location and condition.

H. Revenue Recognition

Sales are recognised on dispatch of goods to customers.

Job work Income is recognised upon completion of the job and ready for delivery as there is no significant uncertainty in ultimate collection.

Other operating income comprises of income from ancillary activities incidental to the operations of the Company and recognised when the right to receive the income is established as per the terms of the contract.

Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

I. Foreign Currency Transactions

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing at the time of the transaction.

Transactions in foreign currencies are recognized at the prevailing exchange rates on the transaction dates. Realized gains and losses on settlement of foreign currency transactions are recognized in Statement of Profit ft Loss. Foreign currency assets and liabilities at the year-end are translated at the year-end exchange rates, and the resultant exchange difference is recognized in the Statement of Profit ft Loss.

3. Employee Benefits

Short-term employee benefits

Short-term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related service is rendered.

Defined Contribution Plans

Contribution to provident fund is charged to the Statement of Profit and Loss for the year in which it becomes due.

Gratuity at present is being charged to the Statement of Profit and Loss in the year in which the payment is made to the employee.

K. Income Tax

Current Tax: Provision is made for income tax on yearly basis, under the tax-payable method based on tax liability, as computed after taking credit for allowances and exemptions as per Income Tax Act, 1961.

Deferred Tax: Deferred tax liability assets is recognized on timing differences being the difference between taxable income and accounting income 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.

Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized only to the extent that there is virtual certainty that sufficient taxable income will be available to realize these assets, AN other deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available to realize assets.

L. Prior Period Items

Material items of prior period expenses, non-recurring and extra-ordinary items are disclosed separately.

M. Provisions,

Provisions involve substantial degree of estimation in measurement and are recognized where there is a present obligation as a result of past events and it is probable that there will be an outflow of resources embodying economic benefits. These are reviewed at each balance sheet date to reflect

N. Contingent Liabilities and Contingent Assets

A contigent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future event beyond to control of the company of a present obligation that is not recognized because it is not probable that an outflow of resources embodying future economic benefits will be required to settle the not recognize a contigent liability but discloses its existence in the contigent assets are neither recognized nor disclosed in the financial statements followingthe principal of conservatism.

O. Cash Flow Statements

Cash flow statement is reported using Indirect method, whereby Profit / (Loss) before tax is adjusted for the effects of transaction of non-cash in nature and any deferrals or accruals of past or future cash receipts or payments. The cash flow from operating, Investing and financing activities of the company are segregated based on available information. Cash and cash equivalents for the purpose of cash flow statement comprise cash at bank and in hand and short-term investment with original maturity of three months or less.

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Mar 31, 2012

A. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

The financial statements have been prepared on an accrual basis and under the historical cost convention and materially comply with the mandatory accounting standards issued by the Institute of Chartered Accountants of India. The accounting policies adopted in the preparation of financial statements have been consistently applied.

B. FIXED ASSETS & DPERECIATION

(a) Fixed assets are capitalized at the acquisition cost including directly attributable cost of bringing the assets to their working condition for intended use. Fixed Assets are stated at cost net of CENVAT/Value Added Tax, rebates less accumulated depreciation.

(b) Depreciation on fixed assets is provided pro-rata on Straight Line Method basis as per the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956. When assets are disposed or retired, their cost and accumulated depreciation are removed from the financial statements. The gain/loss arising therefore is recognized in Profit and Loss Statement.

C. INVESTMENTS

Long-term Investments are stated at cost less amount written off, where there is a diminution in its value of long-term nature.

D. INVENTORIES:

All the inventories are valued at lower of Cost and Net Realizable Value except Work-in-Progress which is valued at cost incurred till date.

E. REVENUE:

(a) Sales are recognized on dispatch of goods to customers.

(b) Job work Income is recognized upon completion of the job and ready for delivery as there is no significant uncertainty in collection of the amount of consideration.

F. FOREIGN CURRENCY TRANSACTIONS:

Export sales proceeds are taken at the exchange rate applicable on the date of conversion of proceeds by the Bankers. The difference in rate of exchange as on date of transaction and as on date of realization has been dealt with in the Profit and Loss Statement.

G. ACCOUNTING OF IMPORT ENTITLEMENTS:

Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under the Duty Exemption Scheme" is being accounted in the year of export.

H. INCOME TAX:

(a) Current Tax: Provision is made for income tax on yearly basis under the tax payable method, based on tax liability as computed after taking credit for allowances and exemptions.

(b) Deferred Tax:Provision for deferred tax is made based on guidelines given as per Accounting Standard 22: "Accounting for taxes on income", issued by the ICAI.

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Mar 31, 2010

I. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

The financial statements have been prepared under the historical cost convention and materially comply with the mandatory accounting standards issued by the Institute of Chartered Accountants of India. The significant accounting policies followed by the company are as stated below:

i) FIXED ASSETS:

Capitalized at the acquisition cost including directly attributable cost of bringing the assets to their working condition for intended use.

Fixed Assets are stated at cost net of CENVAT/ Value Added Tax, rebates less accumulated depreciation.

ii) DEPRECIATION:

Depreciation on fixed assets is provide on Straight Line Method basis as per the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956.

iii) INVENTORIES:

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

iv) REVENUE:

Sales are recognized on dispatch of goods to customers

Job work Income is recognized upon completion of the job and ready for delivery as there is no significant uncertainty in collection of the amount of consideration.

v) FOREIGN CURRENCY TRANSACTIONS:

Export sales proceeds are taken at the exchange rate applicable on the date of conversion of proceeds by the Bankers. The difference in rate of exchange as on date of transaction and as on date of realization has been dealt with in the Profit & Loss Account.

vi) ACCOUNTING OF IMPORT ENTITLEMENTS:

The company is entitled to duty free import entitlements on its exports. All import entitlements receivables for exports made up to the year end under audit have been valued at prices prevailing at the year end and as explained and certified by the management on accrual basis.

vii) INCOME TAX:

Current Tax: Provision is made for income tax on yearly basis under the tax payable method, based on tax liability as computed after taking credit for allowances and exemptions.

Deferred Tax: Provision for deferred tax is made based on guidelines given as per Accounting Standard 22 (AS 22) "Accounting for taxes on income" issued by the

Institute of Chartered Accountants or India.