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Accounting Policies of Jayatma Spinners Ltd. Company

Mar 31, 2015

A. Basis of Preparation of Financial Statements

The financial statements have been prepared in accordance with the generally accepted accounting principles and on accrual basis of accounting under historical cost.

b. Use of Estimates

The preparation of financial statements requires the Management make 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. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Difference between the actual results and estimates are recognized in the period in which the results materialize or are known.

c. Inventories

Items of Inventories are valued at cost.

d. Cash Flow Statement

Cash Flow are reported using the indirect method, whereby profit/loss before extraordinary items and tax is adjusted for 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. Fixed Assets and Depreciation

1. Fixed Assets are stated at cost less accumulated depreciation. All cost, including financing cost till commencement of assets put to use, effect of foreign exchange contracts and adjustment arising from exchange rate variations attributable to the fixed assets are capitalised.

2. Expenditure including finance costs related to borrowed funds for the fixed assets incurred on projects under implementation is included under "Capital Work in Progress". These expenses are transferred to fixed assets on commencement of respective projects.

3. Tangible Assets

(i) Depreciation on Fixed Assets is provided to the extent of depreciable amount on Straight Line Method based on balance useful lives of the Assets as per useful life prescribed in Schedule II to the Companies Act, 2013.

(ii) The carrying amount of the asset, as on date of Schedule II becoming effective, after retaining the residual value, shall be recognised in the opening balance of retained earnings where the remaining useful life of an asset is NIL.

f. Revenue Recognition

Sales of goods and other operational revenue are net of tax.

g. Other Income

Interest Income is accounted on accrual basis. Dividend Income is accounted for when the right to receive it is established.

h. Foreign Currency Transactions

Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the dated of the transaction. Monetary assets & liabilities remaining unsettled at the year-end are translated at closing rates.

i. Investments

Investments that are intended to be held for more than a year, from the date of acquisition, are classified as Long Term Investments. Long Term Investments and Current Investments are carried at cost. Unquoted investments are stated at book value. However, provision for diminution in value of investment is made to recognise a decline in the value of investment.

j. Earnings per Share

Basic Earnings per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.

k. Tax on Income

Current Tax is determined on the basis of the amount of tax payable in respect of taxable income for the year.

Deferred Tax is calculated at current statutory Income Tax rate and is recognized on timing differences, being the difference between the Taxable Income and Accounting Income that originate in one period. Deferred Tax Assets subject to the consideration of prudence are recognized and carried forward only to the extent that there is a responsible certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

l. Provisions and contingencies

Provisions involving substantial degree of estimation in measurement are recognized when there is 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 of the obligation. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities are not recognized but are disclosed by way of notes.




Mar 31, 2014

A. Basis of Preparation of Financial Statements : The financial statements have been prepared in accordance with the generally accepted accounting principles and on accrual basis of accounting under historical cost.

b. Use of Estimates : The preparation of financial statements requires the Management to make 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. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Difference between the actual results and estimates are recognized in the period in which the results materialize or are known.

c. Inventories : Items of Inventories are valued at cost.

d. Cash Flow Statement : Cash Flows are reported using the indirect method, whereby profit/loss before extraordinary items and tax is adjusted for 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. Depreciation and amortization : Depreciation has been provided on straight line method as per the provision of section 205(2)(a) of The Companies Act, 1956 and as per the SCHEDULE XIV of The Companies Act, 1956. However, as per the consistency followed by the Management, the Company has not provided depreciation on its fixed assets from 1998-1999 to 2011-2012 (Refer Note 11) However from FY 2012-13 the Company has provided depreciation on SLM on the Assets purchased thereafter.

f. Revenue Recognition : Sales of goods and other operational Revenue are net of tax.

g. Other Income : Interest Income is accounted on accrual basis. Dividend Income is accounted for when the right to receive it is established.

h. Tangible fixed assets : Fixed Assets are stated at cost of acquisition less accumulated depreciation upto year 1997-99. The installation and direct attributable major expenses incurred on the addition of the assets are capitalized to respective assets. (Refer Note 11)

i. Investments : Investments classified as long term investments are stated at cost of acquisition, except where there is permanent diminution in value of investments, appropriate provision for diminishing value has been made in the accounts.

j. Earnings per share : Basic Earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.

k. Tax on Income : Current Tax is determined on the basis of the amount of tax payable in respect of taxable income for the year.

Deferred tax asset/liability arising due to timing differences and unabsorbed losses under tax laws is not recognized during the year based on the concept of prudence and uncertainty for the realistic estimates for the future profits.

l. Provisions and contingencies : Provisions involving substantial degree of estimation in measurement are recognized when there is 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 of the obligation. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities are not recognized but are disclosed by way of notes.


Mar 31, 2013

A. Basis of Preparation of Financial Statements

The financial statements have been prepared in accordance with the generally accepted accounting principles and on accrual basis of accounting under historical cost.

b. Use of Estimates

The preparation of financial statements requires the Management to make 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. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Difference between the actual results and estimates are recognized in the period in which the results materialize or are known.

c. Inventories

Items of Inventories are valued at cost.

d. Cash Flow Statement

Cash Flows are reported using the indirect method, whereby profit/loss before extraordinary items and tax is adjusted for 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. Depreciation and amortization

Depreciation has been provided on straight line method as per the provision of section 205(2)(a) of The Companies Act, 1956 and as per the SCHEDULE XIV of The Companies Act, 1956. However, as per the consistency followed by the Management, the Company has not provided depreciation on its fixed assts from 1998-1999 to 2011-2012 (Refer Note 11) However Company has provided depreciation on SLM on the Assets purchased during the year.

f. Revenue Recognition

Sales of goods and other operational Revenue are net of tax.

g. Other Income

Interest Income is accounted on accrual basis. Dividend Income is accounted for when the right to receive it is established.

h. Tangible fixed assets

Fixed Assets are stated at cost of acquisition less accumulated depreciation upto year 1997-99. The installation and direct attributable major expenses incurred on the addition of the assets are capitalized to respective assets. (Refer Note 11)

i. Investments

Investments classified as long term investments are stated at cost of acquisition, except where there is permanent diminution in value of investments, appropriate provision for diminishing value has been made in the accounts..

j. Earnings per share

Basic Earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.

k. Tax on Income

Current Tax is determined on the basis of the amount of tax payable in respect of taxable income for the year.

Deferred tax asset/liability arising due to timing differences and unabsorbed losses under tax laws is not recognized during the year based on the concept of prudence and uncertainty for the realistic estimates for the future profits.

l. Provisions and contingencies

Provisions involving substantial degree of estimation in measurement are recognized when there is 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 of the obligation... Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities are not recognized but are disclosed by way of notes.


Mar 31, 2012

A. Basis of Accounting and Preparation of financial statements :

The financial statements have been prepared in accordance with the Generally Accepted Accounting Principles and on accrual basis ol accounting under historical cost.

b. Use of Estimates :

. The preparation of the financial statements requires the Management to make 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. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Difference between the actual results and estimates are recognized in the period in which the results materialize or are known.

C. Inventories :

Items of Inventories are valued at cost.

d. Cash Flow Statements :

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. Depreciation and amortization :

Depreciation has been provided on straight line method as per the provision of section 205(2)(a) of The Companies Act, 1956 and as per the SCHEDULE XIV of The Companies Ad, 1956. However, as per the consistency followed by the Management, the Company has not provided depreciation on its fixed assets since 1996-99. (Refer Note 9)

f. Revenue Recognition :

Sale of goods are net of tax.

g. Other Income :

Interest Income is accounted on accrual basis. Dividend Income is accounted for when the right to receive it is established.

h. Tangible fixed assets:

Fixed Assets are stated at cost of acquisition less accumulated depreciation upto year 1997-99. The installation and dired attributable major expenses incurred on the addition of the assets are capitalized to respedive assets. (Refer Note 9)

i. Investments :

Investments classified as long term investments are stated at cost of acquisition, except where there Is permanent diminution in value of investments, such are stated at net of provisions made.

j. Earnings per share :

Basic Earning per share is computed by dividing the profrt/(loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.

k. Taxes on Income :

Current Tax is determined on the basis of the amount of tax payable in respect of taxable income for the year.

Deferred tax asset arising due to timing differences and unabsorbed losses under tax laws is not recognized during the year based on the concept of prudence and uncertainty for the realistic estimates of the future profits.

l. Provisions and contingencies :

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events, it is probable that there will be an outflow of resources and a reliable estimate can be made of the amount of the obligation. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent Liabilities are not provided for and are disclosed by way of notes.




Mar 31, 2011

(1) SYSTEM OF ACCOUNTING

Accounts have been maintained on accrual concept, unless otherwise stated.

The preparation of financial statements requires the management of the company to make estimates and assumptions that affect the reported balances of assets and liabilites and disclosures relating to the contingent liabilites as at the date of the financial statements and reported amounts of income and expenses during the year. Differences between actual results and estimates are recognised in the period in which the results are known/ materialised.

(2) FIXED ASSETS:

Fixed Assets are valued at cost including allocated Pre-operative expenses less Depreciation.

(3) DEPRECIATION:

Depreciation on Fixed Assets have been provided on Straight Line Method at the rates given in the Schedule XIV to the Companies Act, 1956 as ammended by notification daled 16-12-93. Depreciation on Plant & Machinery is provided at the rates given for Continuous process Plant. (See Note-6)

(4) INVESTMENTS : Investment are stated at cost.

(5) VALUATION OF INVENTORIES :

Inventory is valued at lower of cost or net realisable value.

(6) RETIRMENT BENEFITS :

Gratuity is accounted on accrual basis.

(7) SALES & OTHER INCOME :

Sales is net of tax.

Dividend & Other income are accounted on cash basis.

(8) PROVISIONS, CONTINGENT LlABILITIES AND CONTINGENT ASSETS :

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events, it is probable that there will be an out flow of resources and a reliable estimate can be made of the amount of the obligation. Contingent Assets are neither recognised nor disclosed in the financial statements. Contingent liabilities are not provided for and are disclosed by way of notes.

(9) CONTINGENT LIABILITIES NOT PROVIDED FOR:

(a) Claims against company not acknowledged Rs. 3900000/-

as debt. Rs.(3900000/-)

(10) Balances of Unsecured Loans, Sundry Debtors, Sundry Creditors, Loans and Advances and other liabilities are subject to confirmation and reconciliation Any adjustment that may be necessary will be made in the subsequent year on receipt of confirmation.

(11) In accordance with the "Accounting Standard 22" issued by the Institute of Chartered Accountants of India, "Deferred tax assets" arising due to timing differences and unabsorbed losses under tax laws is not recognised during the year based on the concept of prudence and uncertainty for the realistic estimates of the future profits,

(12) The Company has not provided depreciation on its fixed assets since 1998-99. Due to this, profit for the current year is higher stated by Rs. 372724/- (1101350/-) to the extent of depreciation charge. Consequently, the Net Block of Fixed Assets and Net Worth is shown higher by Rs.16154421/- (15781697/-) to the extent of unprovided accumulated depreciation.

 
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