Mar 31, 2018
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS A CORPORATE INFORMATION:
The Company Ishan Dyes and Chemicals Limited was incorporated on 30th November, 1993 under the Companies Act, 1956. The Company Is at present listed on BSE Limited [Bombay Stock Exchange). The Company is engaged into the business of manufacturing Copper Phthalocyanine Crude Blue (CPC Blue) and Pigment Blues. The products of the Company are well established in the international and domestic market
B SUMMARY OF BASIS OF COMPLIANCE, BASIS OF PREPARATION AND PRESENTATION, CRITICAL ACCOUNTING ESTIMATES, ASSUMPTIONS AND JUDGMENTS AND SIGNIFICANT ACCOUNTING POLICIES:
B.l BASIS OF COMPLIANCE
The financial statements comply in all material aspects with Indian Accounting Standards (''Ind AS'') notified under Section 133 of the Companies Act, 2013 (âthe 2013 Acf) read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Act
Until the adoption of Ind AS, for all periods up to and including the year ended 31 March, 2017, the Company prepared its financial statements in accordance with Section 133 of the 2013 Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (''Previous GAAP7).
Reconciliation and description of the effects of the transition has been summarized in note 44.
B.2 BASIS OF PREPARATION AND PRESENTATION
The financial statements have been prepared under the historical cost convention using the accrual method of accounting basis, except for certain financial instruments that are measured at fair values at the end of each reporting period as explained in the significant accounting polices below.
All assets and liabilities have been classified as current or non-current as per the Companyâs normal operating cycle and other criteria set out In the Schedule HI to the 2013 Act
B.3 CRITICAL ACCOUNTING ESTIMATES, ASSUMPTIONS AND JUDGMENTS
The preparation of the financial statements requires management to make estimates, assumptions and judgments that affect the reported balances of assets and liabilities and disclosures as at the date of the financial statements and the reported amounts of income and expense for the periods presented
The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant Actual results may differ from these estimates considering different assumptions and conditions.
Estimates and underlying assumptions are reviewed on an ongoing basis. Impact on account of revisions to accounting estimates are recognized in the period in which the estimates are revised and future periods are affected.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying values of assets and liabilities within the next financial year are discussed below.
C.l SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a] Property, plant and equipment
Property, plant and equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable to bringing the assets to its working condition for its intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the assets.
Subsequent costs are Included In the asset''s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured reliably.
Expenses incurred relating to project net of income earned during the project development stage prior to its intended use, are considered as pre - operative expenses and disclosed under Capital Work - in -Progress.
Depreciation on property, plant and equipment is provided using straight line method.
Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013 except, where useful life is different than those prescribed in Schedule II;
The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.
Gains or losses arising from derecognition of a property, plant and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized In the Statement of Profit and Loss when the asset is derecognized.
SIGNIFICANT ACCOUNTING POLIGES AND NOTES ON ACCOUNTS 0>) Investments
The Company reviews its carrying value of investments carried at amortized cost annually, or more frequently when there is an indication for impairment If the recoverable amount is less than its carrying amount, the impairment loss is accounted for.
(c) Borrowing cost
Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for Its intended use.
All other borrowing costs are charged to the Statement of Profit and Loss for the period for which they are incurred.
(d) Inventories
The inventory Is valued as follows:
(i) Raw Materials At Cost First in First out
(ii) Stores and Spare parts At Cost First in First out
(iii) Finished Goods Valued at lower of cost or Net Reliable Value
(iv) Work in Process At cost by using absorption cost method.
As per normal practices the cost of finished goods includes all direct cost and normal fixed overheads. However, it does not include selling and distribution cost Value of stock of finished goods at the date of Balance Sheet includes duties and taxes if any applicable.
(e) Impairment loss
Impairment loss is provided to the extent the carrying amount of assets exceeds their recoverable amounts. Recoverable amount Is the higher of an asset''s net selling price and its value in use. Value in use Is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm''s length transaction between knowledgeable, willing parties, less the costs of disposaL
(f). Employee benefit obligations Short term employee benefits
The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognized as an expense during the period when the employees render the services.
Post-employment benefits
1) Defined Benefit Plan GRATUITY
The Trustees of Ishan Dyes and Chemicals Limited Employees'' Gratuity Fund has a fund arrangement (cash accumulation policy] with Life Insurance Corporation of India (LIC) to administer its gratuity benefit scheme. The contributions towards the said funds which are as determined by LIC are charged to revenue each year. Company ascertains the Liability towards Gratuity at the year-end and provision for the differential amount between the liability determined on Actuarial Valuation and Fund balance is provided in the books of account
2) Defined Contribution Plans PROVIDENT FUND
A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund. The Company''s contribution is recognized as an expense in the Profit and Loss Statement during the period in which the employee renders the related service.
(g) Cash and cash equivalents
The Company considers all highly liquid financial instruments, which are readily convertible into known amounts of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents. Cash and cash equivalents consist of halances with banks which are unrestricted for withdrawal and usage.
(h) Foreign currency translation
The functional currency of lshan Dyes and Chemical Limited (i.e. the currency of the primary economic environment in wbich the Company operates) is Indian Rupee.
On initial recognition, all foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the date of the transaction. As at the reporting date, foreign currency monetary assets and liabilities are translated at the exchange rate prevailing on the Balance Sheet date and the exchange gains or losses are recognized In the Statement of Profit and Loss.
(i) Revenue recognition
Revenue is recognized only when risks and rewards incidental to ownership are transferred to the customer, it can be reliably measured and it is reasonable to expect ultimate collection. Revenue from operations are net of excise duty, GST and adjusted for discounts (net).
Interest income is recognized on a time proportion basis taking into account the amount outstanding and the interest rate applicable.
Dividend income is recognized when the Companyâs right to receive the payment has been established.
(j) Provision, contingent liabilities and contingent assets :
Provision is recognized in the accounts when there is a present obligation as a result of past event(s) and it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can he made. Provisions are not discounted to their present value and are determined hased on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed unless the possibility of outflow of resources is remote.
Contingent assets are neither recognized nor disclosed In the financial statements.
(k) Income tax expense
The tax expense for the period comprises current and deferred tax. Tax is recognized in Statement of Profit and Loss, except to the extent that it relates to items recognized in the comprehensive income or in equity. In which case, the tax is also recognized in other comprehensive income or equity.
Current tax assets and liabilities are measured at the amount expected to he recovered from or paid to the taxation authorities, hased on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of Deferred tax liabilities and assets are reviewed at the end of each reporting period.
(m) Impairment
Provision is made in the accounts in respect of debts/advances which in the opinion of the management are considered doubtful of recovery.
(n) Financial instruments
i) Financial Assets
A. Initial recognition and measurement
At Initial recognition, the Company measures a financial asset at Its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
B. Subsequent measurement
Subsequent measurement of deht Instruments depends on the Companyâs business model for managing the asset and the cash flow characteristics of the asset There are three measurement categories into which the Company classifies its debt instruments:
a) Financial assets carried at amortized cost (AC]
Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and Interest are measured at amortized cost A gain or loss on a debt investment that is subsequently measured at amortized cost and Is not part of a hedging relationship Is recognized In profit or loss when the asset Is derecognized or Impaired. Interest Income from these financial assets is included in finance income using the effective interest rate method.
b) Financial assets at fair value through other comprehensive income (FVTOCI)
Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'' cash flows represent solely payments of principal and Interest are measured at fair value through other comprehensive Income (''FVTOCI''). Movements In the carrying amount are taken through OCI, except for the recognition of Impairment gains or losses. Interest revenue and foreign exchange gains or losses which are recognized in Statement of Profit and Loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss and recognized as gains/ (losses) within other income or other expense. Interest income from these financial assets is included in other income using the effective interest rate method.
c) Financial assets at fair value through profit or loss (FVTPL)
Assets that do not meet the criteria for amortized cost or FVTOCI are measured at fair value through profit or loss. A gain or loss on a deht investment that is subsequently measured at FVTPL and is not part of a hedging relationship is recognized in profit or loss and presented net in the Statement of Profit and Loss as gains/(losses) within other income or other expense in the period in which it arises. Interest income from these financial assets is included in other income.
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
C. Investment in equity instruments
The Company subsequently measures all equity investments at fair value. Where the Company''s management has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to the Statement of Profit and Loss. Dividends from such investments are recognized In the Statement of Profit and Loss as Other Income when the Company''s right to receive payments is established. Changes in the fair value of financial assets at FVTPL are recognized as gains/[losses) within other income or other expense In the Statement of Profit and Loss. Impairment losses (and reversal of impairment losses) on equity Investments measured at FVTOCI are not reported separately from other changes in fair value.
ii) Financial liabilities
A. Initial recognition and measurement
The Company''s financial liabilities comprise borrowings, trade payables and other liabilities. These are initially measured at fair value, net of transaction costs,
B. Subsequent measurement
Subsequently measured at amortized cost using the effective interest method. The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period
(o) Dividend
Final dividend on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Company''s Board of Directors.
Mar 31, 2016
1 BACKGROUND:
Ishan Dyes and Chemicals Ltd. was incorporated On 26th July 1993 under the Companies Act, 1956,The company is engaged into the business of manufacturing Copper Phthalocyanine Crude Blue [CPC Flue and Pigment Rules. The products of the company are also exported and well established in the domestic market.
A SIGNIFICANT ACCOUNTING POLICIES: BASIS OF PREPARATION OF FINANCIAL STATEMENTS
These financial statements have been prepared Lo comply With the Generally Accepted Accounting Principles in India (Indian GAAP), including the Accounting Standards notified tinder the relevant provisions of the Companies Act, 2013.
The inancial statements are prepared on accrual basis Lin tier the historical cost convention, except for certain Fixed Assets which arc carried at revalued amounts.
Current / Non-current classification
The Revised Schedule VI to the Act requires assets and Liabilities to be classified as either Current nr Non-Current.
An asset is classified as current when it satisfies any of the following criteria:
(a) it is expected Lo he realized in, or is intended for sale or consumption in, the normal operating cycle;
(b)it is held primarily for the purpose of being traded;
(c) it is expected to be realized within twelve months after the balance sheet date; or
(d) it is cash or a cash equivalent unless it is restricted from being exchanged in used to settle a liability for at least twelve months after the balance sheet date.
All other assets are classified as non-current.
A liability is classified as current when it satisfies any of the following criteria:
(a] it is expected to lie settled in the entity''s normal operating cycle;
(b) it is held primarily for the purpose of being traded;
© it is due to be sealed within twelve months the balance sheet date; or
(d) the Company does not have an unconditional right to defer settlement of the liability for at
Last twelve months alter the balance sheet date.
All other liabilities arc classified as noncurrent.
All assets and liabilities have been classified as current or nun-current as per the Company''s normal operating cycle and other criteria set out above which are in accordance with the revised Schedule VI to the Act.
ii. USE OF ESTIMATES
The preparation of financial statements in conformity with Indian GAAP requires judgments, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent Inabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period- Difference between the actual results and estimates are recognized in the period in which the results are known/materialized. The management believes that the estimates used in the preparation of the financial statements are prudent and reasonable.
iii. TANGIBLE ASSETS
Fixed Assets are stated at test of acquisition / construction or book value and includes amounts added on revaluation less accumulated depreciation and Impairment loss, if any. The cost of Tangible Assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use.
Subsequent expenditures related to an item of Tangible 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 under which assets are not ready for their intended use are disclosed under Capital Work- in - Progress,
iv. INTANGIBLE ASSETS
Intangible Assets are generally stated at cost of acquisition net of recoverable taxes less accumlated amortization/ depletion.
v. INVESTMENTS
Current Investments are carried at lower of cost and fair value. Long term investments are carried at cost. However, when Blare is a decline, other Lean temporary, the carrying amount is reduced to recognize the decline.
Vi, DEPRECIATION
Effective 1st April 2014, the Company depreciates its Fixed Assets over the useful life in the manner prescribed in Schedule 11 to the Companies Act, 2013, as against the earlier of depreciating at the rates prescribed in Schedule XIV to the Companies Act, 1956.
(i) in case of pre-owned assets, the useful life is estimated on a case to case basis,
(ii) Depreciation on additions to the assets or on sale/discernment of assets, is calculated pro rata Iron the month of such addition or up to the month of such sale/discernment,
iii) Used upon the future projections, the Company has estimated the economic useful life of the assets and accordingly the assets have been depredated.
vii, INVENTORIES
The inventory is valued as follows:
(i) Raw Materials At Cost First in First out,
[ii) Stores and Spare parts At dost First in First Put.
(iii) finished Goods Valued at lower of cost or Net Receivable Value
(iv) Work in Process At cost by using absorption cost method.
As per normal the cost of finished goods includes all direct cost and normal overheads. However it does not include selling and distribution cost Value of stock of finished goods at the date if Balance Sheet includes duties and taxes if any applicable.
viii. RETIREMENT BENEFITS
Short term employee benefits
The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognized as an expense during the period when the employees render the services. Post employment benefits
1) Defined under Plan GRATUITY
The Trustees of ashen Dyes and Chemicals Limited Employsâ Gratuity Fund has a fund arrangement (cash accumulation policy) with Life Insurance Corporation of India (Act) to administer gratuity benefit scheme. The contributions towards the said funds which are as determined by LlC are charged to revenue each year. Company ascertains the Liability towards Gratuity at. the year-end and provision for the differential amount between the liability determined on Actuarial Valuation and fund balance is provided in the books of account.
2) Do fined Contribution Plans PROVIDENT FUND
A defined contribution plan is a post-employment benefit plan under which the Company pays specified Contributions to a Separate entity. The Company makes specified monthly contributions towards Provident Fund. The Company''s contribution is recognized ;-s an expense in the Profit and Loss Statement during the period in which the employee renders the related service,
ix. CENVAT CREDIT
CENVAT Credit is accounted on accrual basis on purchase of materials.
x. FOREIGN CURRENCY TRANSACTIONS
Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of transaction. Monetary items are translated at the year-end rates. The exchange difference between the rate prevailing on the date of transaction and on. the date of settlement as also on translation of monetary tams at the end of the year is recognized as income or expense, as the case may be.
Any premium or discount arising at the inception of the forward exchange contract is recognized as in come or expense over the of the contract.
xi. REVENUE RECOGNITION
Revenue is recognized only when risks and rewards incidental to ownership are transferred to The customer, it can he reliably measured anti it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, excise duty and adjusted for discounts (net).
Interest income 55 recognized on a time proportion basis taking into account the amount outstanding and the interest rate applicable,
xii. PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS :
Provision is recognized m the accounts when there is a present obligation as a result of past event(s} and it is probable that an outflow of resources will be required to settle the obligation anti a reliable estimate can be made. Provisions are discounted to their present value anti are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed unless the possibility of outflow of resources is remote. Contingent assets are neither recognized nor disclosed in the financial statements.
xiii. BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are charged to revenue.
xiv, TAXIS ON INCOME
Tax expense comprises of current tax and deferred tax. Current tax is measured at the amount expected to be paid to the tax authorities, using the applicable lax rates. Deferred income tax reflect the current period timing differences between taxable income and accounting income and reversal of timing differences of earlier years/period. Deferred tax assets lire recognized only to the extent that there is a reasonable certainty that sufficient future income will be available except that deferred Tax assets, in Case there are unabsorbed depreciation or losses, are recognized if there is virtual certainty that sufficient future taxable income will be available to realize the same.
Deferred tax assets and liabilities are measured using the tax rates and tax law that have been enacted or substantively enacted by the Balance Sheet date,
POUBTFUL DEBTS/Advances
Provision is made in the accounts in respect of debts/advances which in the opinion of the management are considered double full of recovery,
xvi. IMPAIRMENT LOSS
Impairment loss is provided to the extent the carrying amount of assets extrudes their recoverable amounts. Recoverable amount is the higher of an asset''s net selling price and its value in use. Value in use is the present value of estimated future cash expected to arise from the continuing use of the asset and front its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm''s length transaction between knowledgeable, willing parties, less the costs of disposal.
Mar 31, 2015
I. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
"The accounts have been prepared to comply in all material aspects with
applicable accounting principles in India, the Accounting Standards
notified in the Companies (Accounting Standards) Rules, 2006 and the
relevant provisions of the Companies Act, 1956 read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of Section 133 of the Companies Act, 2013.
Current / Non-current classification
The Revised Schedule VI to the Act requires assets and liabilities to
be classified as either Current or Non-current.
An asset is classified as current when it satisfies any of the
following criteria:
(a) it is expected to be realized in, or is intended for sale or
consumption in, the entity's normal operating cycle;
(b) it is held primarily for the purpose of being traded;
(c) it is expected to be realized within twelve months after the
balance sheet date; or
(d) it is cash or a cash equivalent unless it is restricted from being
exchanged or used to settle a liability for at least twelve months
after the balance sheet date.
All other assets are classified as non-current.
A liability is classified as current when it satisfies any of the
following criteria:
(a) it is expected to be settled in the entity's normal operating
cycle;
(b) it is held primarily for the purpose of being traded;
(c) it is due to be settled within twelve months after the balance
sheet date; or
(d) the Company does not have an unconditional right to defer
settlement of the liability for at least twelve months after the
balance sheet date.
All other liabilities are classified as non-current.
All assets and liabilities have been classified as current or
non-current as per the Company's normal operating cycle and other
criteria set out above which are in accordance with the revised
Schedule VI to the Act."
ii. USE OF ESTIMATES
The preparation of the financial statements, in conformity with the
generally accepted accounting principles, requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between actual results and estimates are recognised in the
period in which the results are known / materialize.
iii. TANGIBLE ASSETS
Fixed Assets are stated at cost of acquisition / construction or book
value and includes amounts added on revaluation less accumulated
depreciation and impairment loss, if any.
iv. INTANGIBLE ASSETS
Intangible Assets are generally stated at cost of acquisition net of
recoverable taxes less accumlated amortisation/ depletion.
v. INVESTMENTS
Current Investments are carried at lower of cost and fair value. Long
term investments are carried at cost. However, when there is a decline,
other than temporary, the carrying amount is reduced to recognise the
decline.
vi. DEPRECIATION
Effective 1st April 2014, the Company depreciates its Fixed Assets over
the useful life in the manner prescribed in Schedule II of the Act, as
against the earlier practice of depreciating at the rates prescribed in
Schedule XIV to the Companies Act, 1956.
(i) In case of pre-owned assets, the useful life is estimated on a case
to case basis.
(ii) Depreciation on additions to the assets or on sale/discardment of
assets, is calculated prorata from the month of such addition or upto
the month of such sale/discardment, as the case may be.
(iii) Based upon the future projections, the Company has estimated the
economic useful life of the assets and accordingly the assets have been
depreciated.
vii. INVENTORIES
The inventory is valued as follows:
(i) Raw Materials At Cost First in First out.
(ii) Stores and Spare parts At Cost First in First out.
(iii) Finished Goods Valued at lower of cost or Net Relisable Value
(iv) Work in Process At cost by using absorption cost method.
As per normal practices the cost of finished goods includes all direct
cost and normal fixed overheads. However, it does not include selling
and distribution cost. Value of stock of finished goods at the date of
Balance Sheet includes duties and taxes if any applicable.
viii. RETIREMENT BENEFITS 1) GRATUITY
The Trustees of Ishan Dyes and Chemicals Limited Employees' Gratuity
Fund has a fund arrangement (cash accumulation policy) with Life
Insurance Corporation of India (LIC) to administer its gratuity benefit
scheme. The contributions towards the said funds which are as
determined by LIC are charged to revenue each year. Company ascertains
the Liability towards Gratuity at the year-end and provision for the
differential amount between the liability determined on Actuarial
Valuation and Fund balance is provided in the books of account.
2) PROVIDENT FUND
Liability is determined on the basis of contribution as required under
the statute/rules.
ix. CENVAT CREDIT
CENVAT Credit is accounted on accrual basis on purchase of materials.
x. FOREIGN CURRENCY TRANSACTIONS
"Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of transaction. Monetary items are translated at
the year-end rates. The exchange difference between the rate prevailing
on the date of transaction and on the date of settlement as also on
translation of monetary items at the end of the year is recognised as
income or expense, as the case may be.
Any premium or discount arising at the inception of the forward
exchange contract is recognized as income or expense over the life of
the contract."
xi. REVENUE RECOGNITION
Revenue / Income is recognised when no significant uncertainty as to
determination or realisation exists.
xii. PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS :
Provision involving substantial degree of estimation in measurement is
recognised when there is present obligation as a result of past events
and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in notes,
if any. Contingent Assets are neither recognised nor disclosed in the
financial statement.
xiii. BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction
or productionof qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that necessarily takes a
substantial period of time to get ready for its intended use or sale.
All other borrowing costs are charged to revenue.
xiv. TAXES ON INCOME
Tax expense comprises of current tax 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 income tax
reflect the current period timing differences between taxable income
and accounting income for the period and reversal of timing differences
of earlier years/ period. Deferred tax assets are recognised only to
the extent that there is reasonable certainty that sufficient future
income will be available except that deferred tax assets, in case there
are unabsorbed depreciation and losses, are recognised if there is
virtual certainty that sufficient future taxable income will be
available to realise the same.
xv. DOUBTFUL DEBTS/ADVANCES
Provision is made in the accounts in respect of debts/advances which in
the opinion of the management are considered doubtful of recovery.
xvi. IMPAIRMENT LOSS
Impairment loss is provided to the extent the carrying amount of assets
exceeds their recoverable amounts. Recoverable amount is the higher of
an asset's net selling price and its value in use. Value in use is the
present value of estimated future cash flows expected to arise from the
continuing use of the asset and from its disposal at the end of its
useful life. Net selling price is the amount obtainable from sale of
the asset in an arm's length transaction between knowledgeable, willing
parties, less the costs of disposal.
Mar 31, 2014
A. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The accounts have been prepared to comply in all material aspects with
applicable accounting principles In India, the Accounting Standards
notified in the Companies (Accounting Standards] Rules, 2006 and the
relevant provisions of the Companies Act; 1956 read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of Section 133 of die Companies Act; 2013, Current /
Non-current classification.
The Revised Schedule VI to the Act requires assets and liabilities to
be classified as either Current or Non-current An asset is classified
as current when it satisfies any of the following criteria:
[a) it is expected to be realized in, or is intended for sale or
consumption in, the entity''s normal operating cycle;
[b} it Is held primarily for the purpose of being traded;
[c] it is expected to be realized within twelve months after the
balance sheet date; or
id] it is cash or a cash equivalent unless it is restricted from being
exchanged or used to settle a liability for at least twelve months
after the halance sheet date.
All other assets are classified as non-current
A liability is classified as current when it satisfies any of the
following criteria:
[a) it is expected to be settled in the entity''s normal operating
cycle;
b) it is held primarily for the purpose of being traded;
[c] It Is due to be settled within twelve months after the balance
sheet date; or
[d) die Company does not have an unconditional right to defer
settlement of the liability for at least twelve months after die
balance sheet date.
All other liabilities are classified as non-current
All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out above which are in accordance with the revised
Schedule VI to the Act.
b. USE OF ESTIMATES
The preparation of the financial statements, in conformity with the
generally accepted accounting principles, requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the Financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between actual results and estimates are recognised In the
period in which the results are known / materialize.
c TANGIBLE ASSETS
Fused Assets are stated at costof acquisition /construction or book
value and includes amounts added on revaluation less accumulated
depreciation and impairment loss, if any.
d. INTANGIBLE ASSETS
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumlated amortisation/ depletion.
e. INVESTMENTS
Current Investments are carried at lower of cost and fair value. Long
term investments are carried at cost However, when there Is a decline,
other than temporary, the carrying amount is reduced to recognise the
decline.
f. DEPRECIATION
Depreciation on fixed assets is provided on straight line /written down
value basis in accordance with the Companies Act, 1956-
i) Depreciation is provided at the rates and in the manner specified
in Schedule XIV to the Companies Act, 1956
(ii) Depreciation for the year is provided on the revalued cost of
Assets and Is charged to the Profit and Loss Account. [Hi]
Depreciation for the year on Intangible assets is provided at 100% and
charged to the Profit and Loss Account
g. INVENTORIES
The inventory is valued as follows:
[i) Raw Materials At Cost Hirst in First out
[ii) Stores and Sparc parts At Cost First in First out
{iii) Fi nished Goods Va Lued at lower of cost or Net Reusable Value
(iv) Work in Process At cost by using absorption cost method.
As per normal practices the cost of finished goods includes all direct
cost and normal fined overheads. However, it does not include selling
and distribution cost Value of stockof finished goods at the date of
Balance Sheet includes duties and taxes if any applicable.
h. RETIREMENT BENEFITS 1] GRATUITY
The Trustees of Ishan Dyes and Chemicals Limited Employees'' Gratuity
Fund has a fund arrangement [cash accumulation policy] with Life
Insurance Corporation of India (LIC) to administer Its gratuity benefit
scheme. The contributions towards the said funds which are as
determined by LIC are charged to revenue each year. Company ascertains
the Liability towards Gratuity at the year-end and provision for the
differential amount between the liability determined on Actuarial
Valuation and Fund balance is provided in the books of account
Mar 31, 2013
1.1 Basis of Preparation of Financial Statements
The financial Statements are prepared under the historical cost
convention on an accrual basis and are in conformity with the mandatory
accounting standards and the provisions of the Companies Act, 1956 to
the extent possible.
1.2 Use of Estimate
The preparation of financial statements in conformity with generally
accepted accounting principles (GAAP) requires estimates and
assumptions that affect the reported amounts of assets, liabilities,
revenues and expenses and disclosure of contingent liabilities on the
date of financial statements. The estimates and assumptions used in the
accompanying financial statements are based upon management''s
evaluation of the relevant facts and circumstances as of the date of
the financial statements. Actual results may differ from estimates and
assumptions used in preparing the accompanying financial statements.
Any revision to accounting estimates is recognized prospectively in
current and future periods.
1.3 Fixed Assets and Depreciation
1.3.1 Tangible Assets
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. The cost of fixed Assets included
pre-operative expenses incurred up to the date of commencement of
commercial production (netting off by income arising during said
period) and is net of recoverable taxes.
1.3.2 Intangible Assets
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumulated amortization/ depletion. All costs, including
financing costs till commencements of commercial production.
1.3.3 Depreciation
Depreciation on fixed assets is provided at the rate on Triple shift
basis using straight line method in the manner specified in Schedule-
XIV of the companies act, 1956 for the plant and machinery except plant
of Beta Blue on which depreciation is provided on single shift basis.
The Company provides pro-rata depreciation from the day the asset is
ready for use and for any asset sold, till the date of sale.
1.4 Inventory: Valuation and Treatments of Costs:
1.4.1 The Inventory is valued as follows:
1) Raw Materials : At cost (FIFO method), net of Cenvat credit.
2) Stores & Spares : At cost (FIFO method)
3) Finished Goods : Valued at lower of cost or NRV
4) Work in Process : At cost by using absorption cost method.
1.4.2 As per normal practices the cost of finished goods includes all
direct cost and normal fixed cost. However, it does not include selling
and distribution cost. Values of stocks of finished goods at the date
of Balance Sheet includes duties and taxes payable to comply with
accounting standard of Income Tax Act. Provisions of such duty Its also
made as duty and taxes payable in the accounts as on the date of
Balance Sheet.
1.5 Revenue Recognition:
1.5.1 Sales: Sales are recognized at the time of dispatch of goods. All
sales are shown net of excise duty, sales return, discount, and amount
recovered towards VAT.
1.5.2 Other Income: Interest on deposits is accounted for an accrual
basis. Dividend on shares is accounted on receipt basis. Export
Incentives are recognized on accrual basis.
1.6 Provisions:
A provision is recognized when the company has a legal and constructive
obligation as a result of past events, for which it is probable that
cash outflows will be required and reliable estimates can be made of
the amount of obligation.
1.7 Contingent Liabilities:
Contingent Liabilities are disclosed by the way of notes on accounts.
1.8 Capital Contribution:
Capital Contribution made towards Common Effluent Treatment Plant to
Green Environment Service Co- Op. Society Ltd was shown under Long Term
Loans & Advances as CETP was under construction in previous year.
During the year under review as CETP construction was completed , it
has been treated as Intangible Asset since the Company has ''right to
use''.
1.9 Earning Per Share
The basic earnings per share is computed by dividing the net profit
attributable to the equity shareholders for the period by the weighted
average number of equity shares outstanding during the reporting
period. The number of shares used in computing diluted earnings per
share comprises the weighted average number of shares considered for
deriving basic earnings per share, and also the weighted average number
of equity shares, which could have been issued on the conversion of all
dilutive potential shares. In computing dilutive earnings per shares,
only potential equity shares that are dilutive and that increase loss
per share are included.
1.10 Investments:
Investments are stated at cost of acquisition.
1.11 Retirement Benefits:
Contribution to Provident fund is charged to Profit and Loss accounts.
Gratuity is charged to profit and loss accounts on the basis on
actuarial valuation done. Leave encashment is charged to Profit & Loss
accounts.
1.12 Accounting for Tax
Provision for current tax is made after taking into consideration
benefits admissible under the provisions of the Income-tax Act, 1961.
Deferred tax resulting from "timing difference" between taxable and
accounting income is accounted for using the tax rates and laws that
are enacted or substantively enacted as on the balance sheet date.
Deferred tax assets is recognized and carried forward only to the
extent that there is a virtual certainty that the assets will be
realized in future.
1.13 Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognized when there is a present obligation as a result of past
events and it is probable that there will be outflow of resources.
Contingent liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
Financials Statements.
1.14 Change in Accounting Policies:
No change in accounting policy during the period under review.
1.15 Foreign exchange transactions.
The exports sales transactions are recorded at the prevailing on the
date of sale or that approximates the actual rate at the transaction.
Imports are recorded at the rate prevailing on the date of actual
payments made. The Loss/Gain on exchange fluctuation is
charged/credited to Profit and loss Account.
1.16 Impairment of Assets :
Fixed Assets are reviewed for impairment losses whenever events or
changes in circumstances indicate that carrying amount may not be
recoverable. And impairment loss is then recognized for the amount by
which the carrying amount of the assets exceeds its recoverable amount,
which is higher of the asset''s net selling price and value in use.
Mar 31, 2011
(A) General:
1. Basis of Preparation of Financial Statements
The Financial statements are prepared under the historical cost
convention in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956.
2 Use of Estimates
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of the financial statements and the reported
amount of .revenues and expenses during the reporting period.
Difference between the actual results and estimates are recognised in
the period in which the results are known/ materialised.
B Fixed Assets and Depreciation:
1. Fixed Assets:
Fixed Assets are stated at cost of acquisition or construction less
accumulated depreciation. The cost of Fixed Assets includes
pre-operative expenses incurred up to the date of commencement of
commercial production (netting off by income arising during said
period.) and is net of recoverable taxes.
2. Entangible Assets
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumulated amortisation/ depletion. - All costs, including
financing costs till commencement of commercial production.
3. Depreciation:
Depreciation on fixed Assets is provided at the rate on Triple shift
basis using straight line method in the manner specified in
Schedule-XIV of the Companies Act, 1956 for the plant & machinery
except plant of Beta Blue on which depreciation is provided on single
shift basis.
C. Inventory: Valuation and Treatment of Costs:
1. The inventory is valued as follows:
1 Raw Materials : At cost (FIFO method), net of Cenvat credit.
2 Stores & Spares : At cost (FIFO method)
3 Finished Goods : Valued at lower of cost or NRV
4 Work in Process : At cost by using absorption cost method.
2. As per normal practice the cost of finished goods includes all
direct cost and normal fixed cost. However it does not include selling
and distribution cost. Value of stocks of finished goods at the date of
Balance Sheet includes duties and taxes payable to comply with
accounting standard of Income Tax Act. Provision of such duty is also
made as duty and taxes payable in the accounts as on the date of
Balance Sheet.
(D) Revenue Recognition:
ii. Sales: Sales are recognized at the time of dispatch of goods. All
sales are shown net of excise duty, sales returns, discount, shortage
and amounts recovered towards VAT.
iii. Other Income: Interest on deposit is accounted for on accrual
basis. Dividend on shares is accounted on receipt basis.
E. Provisions:
A provision is recognized when the company has a legal and constructive
obligation as a result of past event, for which it is probable that
cash outflow will be required and reliable estimate can be made of the
amount of obligation.
F. Contingent Liabilities:
Contingent Liabilities are disclosed by way of notes on accounts.
G. Capital Contribution:
Capital Contribution made towards Common Effluent Treatment Plant to
Green Vatva Co- op. Society is treated as deferred revenue expenses and
considering its utility, the expenses are to be written off over a
period of 10 years.
H. Investments:
Investments are stated at cost of acquisition.
I. Retirement Benefits:
Contribution to Provident fund is charged to profit and loss account.
Gratuity is charged to profit and loss account on the basis on
actuarial valuation done.
J. Change in Accounting Policy:
The 31st March 2011, company was accounting for gratuity on actual
payment basis by charging to profit and loss account. To comply with As
- 15, the management has changed policy for gratuity and company has
obtained certificate from approved actuarial valuer with reference
to total liability on account of gratuity as on 31 March 2011.
Accordingly, the company has created reserve of Rs.8.23 Lacs being
gratuity reserve by charging the amount to profit and loss account.
Because of the change in accounting policy, the profit of the year is
lower as compared to earlier year by equal amount and the amount
reserves and surplus is higher by the same amount.