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Accounting Policies of Kanco Enterprises Ltd. Company

Sep 30, 2014

A) Basis of Accounting

These financial statements have been prepared on accrual basis and under historical cost convention and in compliance, in all material aspects, with the generally accepted accounting principals in India. Consequent to the clarification issued by the Ministry of Corporate Affairs, Government of India vide General Circular 08/2014 dated April 04, 2014, these financial statements have been prepared in accordance with the relevant provisions/schedules/rules of the Companies Act,1956, which inter-alia include the applicable Accounting Standards notified under Section 211 (SQ.The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

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 in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current - non current classification of assets and liabilities.

b) Fixed Assets and Depreciation

Fixed Assets : Fixed Assets are stated at cost / book value less depreciation and net of cenvat and subsidy except on freehold land. Depreciation : (i) Depreciation is being provided on Straight Line Method in terms of Section 205(2) (b) of the Companies Act, 1956 at the rates and in the manner specified in Schedule XIV to the said Act. (ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro-rata basis.

c) Investments

All long term investments are stated at cost unless there is a permanent fall in the value of Investments. All current investment are stated at cost or realisable value which ever is lower.

d) Inventories

(i) Stores and Spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

(ii) Raw Materials are valued at cost or net realisable value whichever is lower. Cost is arrived at on the basis of cost of respective lots remaining in stock and related expenses. (Hi) Materials in Process is valued at cost (*) or net realisable value whichever is lower. (iv) Yarn and Knitted Fabrics are valued at cost (*) or net realisable value whichever is lower. *(v) Cost of Valuation of materials in process and yarn has been arrived at ''by adding direct cost & relevant overhead cost'' in accordance with the revised Accounting Standard (AS-2) "Valuation of Inventories", issued by the Institute of Chartered Accountants of India.

(vi) Waste is valued at estimated realisable value.

(vii) Materials in transit are valued at cost to date of the Balance Sheet.

e) Exchange Fluctuations

Monetary Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Statement of Profit & Loss.

f) Revenue Recognition

(i) Sale of goods is recognised at the point of transfer of significant risk and rewards to the customers. (ii) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book- under the "Duty Exemption Scheme" and "Duty Draw Back Scheme" are accounted in the year of export.

g) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

h) Employee Benefits

(i) Defined Contribution Plan : The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and Labour Welfare Fund and the contributions are charged to the Statement of Profit and Loss of the year when the contribution to the respective funds are due. There are no other contributions other than the contributions payable to the respective funds.

(ii) Defined Benefit Plan :

Funded Plan : The Company has defined benefit plans in the form of Gratuity and Leave Encashment the liability for which is determined on the basis of actuarial valuation at the end of the year. Gains and losses arising out of actuarial valuation are recognised immediately to the Statement of Profit and Loss as income or expense.

Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits : Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projetced unit credit method at the end of each financial year. Actuarial gain and losses are recognised immediately in the Statement of Profit and Loss as income or expenses. Company recognised the undiscounted amount of short term employee benefits during the accounting period based on service rendered by an employee.

i) Borrowing Cost

Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. ther borrowing costs are charged as an expense in the year in which these are incurred.

j) Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

k) Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.


Sep 30, 2013

1. SIGNIFICANT ACCOUNTING POLICIES

a) Basis of Accounting

The financial statements have been prepared to comply in all material respects with the Accounting Standards notified by Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

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 in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current non current classification of assets and liabilities.

b) Fixed Assets and Depreciation

Fixed Assets : Fixed Assets are stated at cost / book value less depreciation and net of cenvat and subsidy except on freehold land. Depreciation : (i) Depreciation is being provided on Straight Line Method in terms of Section 205(2) (b) of the Companies Act, 1956 at the rates and in the manner specified in Schedule XIV to the said Act. (ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro rata basis.

c) Investments

All long term investments are stated at cost unless there is a permanent fall in the value of Investments. All current investment are stated at cost or realisable value which ever is lower.

SIGNIFICANT ACCOUNTING POLICIES AND OTHER NOTES TO ACCOUNT (Contd.)

d) Inventories

(i) Stores and Spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

(ii) Raw Materials are valued at cost or net realisable value whichever is lower. Cost is arrived at on the

basis of cost of respective lots remaining in stock and related expenses. (Hi) Materials in Process is valued at cost (*) or net realisable value whichever is lower. (iv) Yarn and Knitted Fabrics are valued at cost(*) or net realisable value whichever is lower. *(v) Cost of Valuation of materials in process and yarn has been arrived at ''by adding direct cost & relevant overhead cost'' in accordance with the revised Accounting Standard(AS 2) "Valuation of Inventories", issued by the Institute of Chartered Accountants of India. (vi) Waste is valued at estimated realisable value. (vii) Materials in transit are valued at cost to date of the Balance Sheet.

e) Exchange Fluctuations

Monetary Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Statement of Profit & Loss.

f) Revenue Recognition

(i) Sale of goods is recognised at the point of transfer of significant risk and rewards to the customers. (ii) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under the "Duty Exemption Scheme" and "Duty Draw Back Scheme" are accounted in the year of export.

g) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

h) Employee Benefits

(i) Defined Contribution Plan : The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and Labour Welfare Fund and the contributions are charged to the Statement of Profit and Loss of the year when the contribution to the respective funds are due. There are no other contributions other than the contributions payable to the respective funds.

(ii) Defined Benefit Plan :

Funded Plan: The Company has defined benefit plans in the form of Gratuity and Leave Encashment the liability for which is determined on the basis of actuarial valuation at the end of the year. Gains and losses arising out of actuarial valuation are recognised immediately to the Statement of Profit and Loss as income or expense.

Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits : Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projetced unit credit method at the end of each financial year. Actuarial gain and losses are recognised immediately in the Statement of Profit and Loss as income or expenses. Company recognised the undiscounted amount of short term employee benefits during the accounting period based on service rendered by an employee. i) Borrowing Cost

Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which these are incurred.

j) Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

SIGNIFICANT ACCOUNTING POLICIES AND OTHER NOTES TO ACCOUNT (Contd.)

k) Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.


Sep 30, 2012

A) Basis of Accounting

The financial statements have been prepared to comply in all material respects with the Accounting Standards notified by Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

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 in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current - non current classification of assets and liabilities.

b) Fixed Assets and Depreciation

Fixed Assets : Fixed Assets are stated at cost / book value less depreciation and net of cenvat and subsidy except on freehold land.

Depreciation : (i) Depreciation is being provided on Straight Line Method in terms of Section 205(2) (b) of the Companies Act, 1956 at the rates and in the manner specified in Schedule XIV to the said Act.

(ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro-rata basis.

c) Investments

All long term investments and are stated at cost unless there is a permanent fall in the value of Investments. All current investment are stated at cost or realisable value which ever is lower.

d) Inventories

(i) Stores and Spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

(ii) Raw Materials are valued at cost or net realisable value whichever is lower. Cost is arrived at on the basis of cost of respective lots remaining in stock and related expenses.

(iii) Materials in Process is valued at cost (*) or net realisable value whichever is lower.

(iv) Yarn and Knitted Fabrics are valued at cost(*) or net realisable value whichever is lower.

*(v) Cost of Valuation of materials in process and yarn has been arrived at ‘by adding direct cost & relevant overhead cost'' in accordance with the revised Accounting Standard(AS-2) "Valuation of Inventories".

(vi) Waste is valued at estimated realisable value.

(vii) Materials in transit are valued at cost to date of the Balance Sheet.

e) Exchange Fluctuations

Monetary Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Statement of Profit & Loss.

f) Revenue Recognition

(i) Sale of goods is recognised at the point of transfer of significant risk and rewards to the customers.

(ii) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under the Duty Exemption Scheme" and "Duty Draw Back Scheme" are accounted in the year of export.

g) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

h) Employee Benefits

(i) Defined Contribution Plan : The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and LabourWelfare Fund and the contributions are charged to the Statement of Profit and Loss of the year when the contribution to the respective funds are due. There are no other contributions other than the contributions payable to the respective funds.

(ii) Defined Benefit Plan :

Funded Plan: The Company has defined benefit plans in the form of Gratuity, the liability for which is determined on the basis of actuarial valuation at the end of the year. Gains and losses arising out of actuarial valuation are recognised immediately to the Statement of Profit and Loss as income or expense. Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits : Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projetced unit credit method at the end of each financial year. Actuarial gain and losses are recognised immediately in the Statement of Profit and Loss Account as income or expenses. Company recognised the undiscounted amount of short term employee benefits during the accounting period based on service rendered by an employee.

i) Borrowing Cost

Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which these are incurred.

j) Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

k) Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An Impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.


Mar 31, 2011

1) Basis of Accounting

(a) The Company generally follows mercantile system of accounting unless otherwise stated and recognises income and expenditure on accrual basis except those with significant uncertainties.

(b) The accounts have been prepared in accordance with historical cost convention method.

2) Fixed Assets and Depreciation

(a) Fixed Assets : Fixed Assets are stated at cost / book value less depreciation and net of cenvat and subsidy except on freehold land.

(b) Depreciation: (i) Depreciation is being provided on Straight Line Method in terms of Section 205(2) (b) of the Companies Act, 1956 at the rates and in the manner specified in Schedule XIV to the said Act.

(ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro-rata basis.

3) Investments All Investments are held as long term investments and are stated at cost unless there is a permanent fall in the value of Investments.

4) Inventories

(a) Stores and spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

(b) Raw materials are valued at cost or net realisable value whichever is lower. Cost is arrived at on the basis of cost of respective lots remaining in stock and related expenses.

(c) Materials in Process is valued at (*) cost or net realisable value whichever is lower.

(d) Yarn and Knitted Fabrics are valued at cost(*) or net realisable value whichever is lower.

*(e) Cost of Valuation of materials in process and yarn has been arrived at by adding direct cost & relevant overhead cost in accordance with the revised Accounting Standard(AS-2) "Valuation of Inventories" issued by the Instititue of Chartered Accountants of India.

(f) Waste is valued at estimated realisable value.

(g) Materials in transit are valued at cost to date of the Balance Sheet.

5) Exchange Fluctuations

Monetary Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Profit & Loss Account.

6) Sales

(a) Sale of goods is recognised at the point of dispatch of finished goods to the customers.

(b) Export sales are accounted on the basis of dates of Bill of Lading.

(c) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under the Duty Exemption Scheme" and Duty Draw Back Scheme are accounted in the year of export.

(d) Benefit on account of entitlement to import goods free of duty under the "Target Plus Scheme" is being accounted in the year in which license for such benefit is received.

7) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

8) Employee Benefits

(i) Defined Contribution Plan : The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and Labour Welfare Fund and the contributions are charged to the Profit & Loss Account of the year when the contribution to the respective funds are due. There are no other contributions other than the contributions payable to the respective funds.

(ii)Defined Benefit Plan : (a) Fund Plan: The Company has defined benefit plans in the form of Gratuity and Leave Encashment, the liability for which is determined on the basis of acturial valuation at the end of the year. Gains and losses arising out of acturial valuation are recognised immediately to the Profit & Loss Account as income or expense. (b) Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits : Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projetced unit credit method at the end of each financial year. Acturial gain & losses are recognised immediately in the Statement of Profit & Loss Account as income or expenses. Company recognised the undiscounted amount of short term employee benefits during the accounting period based on service rendered by an employee.

9) Borrowing Cost Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which these are incurred.

10) Taxes on Income Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

11) Impairment of Assets

The carrying amounts of assets are reveiwed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An Impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.

(12) The Company has made reference to the Board of Industrial & Financial Reconstruction ("BIFR") pursuant to Section 23 of Sick Industrial Companies (Special Provisions) Act,1985 on account of erosion of Net Worth of the Company by more than fifty percent.


Mar 31, 2010

1) Basis of Accounting

(a) The Company generally follows mercantile system of accounting unless otherwise stated and recognises income and expenditure on accrual basis except those with significant uncertainties.

(b) The accounts have been prepared in accordance with historical cost convention method.

2) Fixed Assets and Depreciation

(a) Fixed Assets

Fixed Assets are stated at cost / book value less depreciation and net of cenvat and subsidy except on freehold land.

(b) Depreciation

(i) Depreciation is being provided on Straight Line Method in terms of Section 205(2) (b) of the

Companies Act, 1956 at the rates and in the manner specified in Schedule XIV to the said Act. (ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro-rata basis.

(c) In respect of revalued assets the difference between written down value of the assets as on the date of revaluation and their replacement value is transferred to Revaluation Reserve.

3) Investments

All Investments are held as long term investments and are stated at cost unless there is a permanent fall in the value of Investments.

4) Inventories

(a) Stores and spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

(b) Raw materials are valued at cost or net realisable value whichever is lower.Cost is arrived at on the basis of cost of respective lots remaining in stock and related expenses.

(c) Materials in Process is valued at (*) cost or net realisable value whichever is lower.

(d) Yarn and Knitted Fabrics are valued at cost(*) or net realisable value whichever is lower.

*(e) Cost of Valuation of materials in process and yarn has been arrived at "by adding direct cost & relevant overhead cost" in accordance with the revised Accounting Standard(AS-2) "Valuation of Inventories" issued by the Instititue of Chartered Accountants of India.

(f) Finished Tea is valued at net realisable value.

(g) Waste is valued at estimated realisable value.

(h) Materials in transit are valued at cost to date of the Balance Sheet.

5) Exchange Fluctuations

Monetary Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Profit & Loss Account.

6) Sales

(a) Sale of goods is recognised at the point of dispatch of finished goods to the customers.

(b) Export sales are accounted on the basis of dates of Bill of Lading.

(c) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under the Duty Exemption Scheme" and Duty Draw Back Scheme are accounted in the year of export.

(d) Benefit on account of entitlement to import goods free of duty under the "Target Plus Scheme" is being accounted in the year in which license for such benefit is received.

7) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

8) Employee Benefits

(i) Defined Contribution Plan :

The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and Labour Welfare Fund and the contributions are charged to the Profit & Loss Account of the year when the contribution to the respective funds are due. There are no other contributions other than the contributions payable to the respective funds.

(ii) Defined Benefit Plan :

(a) Fund Plan : The Company has defined benefit plans in the form of Gratuity and Leave Encashment, the liability for which is determined on the basis of acturial valuation at the end of the year. Gains and losses arising out of acturial valuation are recognised immediately to the Profit & Loss account as income or expense.

(b) Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits :

Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projetced unit credit method at the end of each financial year. Acturial gain & losses are recognised immediately in the Statement of Profit & Loss Account as income or expenses. Company recognised the undiscounted amount of short term employee benefits during the accounting period based on service rendered by an employee.

9) Borrowing Cost

Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which these are incurred.

10) Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

11) Impairment of Assets

The carrying amounts of assets are reveiwed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An Impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.


Mar 31, 2009

1) Basis of Accounting

a) The Company generally follows mercantile system of accounting unless otherwise stated and recognises income and expenditure on accrual basis except those with significant uncertainties.

b) The accounts have been prepared in accordance with historical cost convention modified by revaluation , of certain fixed assets.-

2) Fixed Assets and Depreciation

a) Fixed Assets :

Fixed Assets other than those revalued are stated at cost/book value less depreciation and net of Cenvat and subsidy, except on freehold land and land & plantation. "

b) Depreciation:

i) Depreciation is being provided on Straight Line Method in terms of Section.205(2) (b) of the Companies Act, 1956 at the rates specified in Schedule XIV to the said Act ii) In respect of assets acquired/sold during the year, depreciation has been provided on pro-rata basis.

c) In respect of revalued assets the difference between written down value of,the.assets as on the date of revaluation and their replacement value is transferred to Revaluation Reserve.

3) Investments

- All Investments are held as Long Term lnvestments and are stated at cost unless there is a permanent fall in the value of Investments.

4) Inventories

a) Stores and spares are valued at cost. Cost is arrived at on F.I.F.O. basis.

b) - Raw materials are valued at cost or net realisable value whichever is lower. Cost is arrived at on the basis of cost of respective lots remaining in stock and related expenses.

c) Materials in Process is valued at cost (*) or net realisable value whichever is lower.

d) Yarn and Knitted Fabrics are valued at cost (*) or net realisable value whichever is lower.

e) Cost of Valuation of materials in process and yarn Has been arrived at "Full absorption basis" in accordance with revised Accounting Standard (AS-2) "Valuation of Inventories" issued by the Institute of Chartered Accountants of India.

f) Finished Tea is valued at net realisable value.

g) Waste is valued at estimated realisable value.

h) Materials in transit are valued at cost to date of the Balance Sheet.

5) Exchange Fluctuations

Current Assets and Liabilities in foreign currency outstanding at the close of the financial year are valued at the appropriate exchange rates at the close of the year. The loss or gain due to fluctuation of exchange rates is charged to Profit & Loss Account.

6) Sales

a) Sale of goods is recognised at the point of dispatch of finished goods to the customers.

b) Export sales are accounted on the basis of dates of Bill of Lading.

c) 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.

d) Benefit on account of entitlement to import goods free of duty under the "Target Plus Scheme" is being accounted in the year in which license for such benefit is received.

7) Government Grants and Subsidy

Revenue Grants and Subsidy received during the year have been shown by way of deduction from related expenses.

8) Retirement Benefits

(i) Defined Contribution Plan :

The Company has defined contribution plans in the form of Provident Fund, Pension Scheme, EDLI, Super Annuation Fund and Labour Welfare Fund and the contributions are charged to Profit & Loss Account of the year when the contribution to the respective funds are due. There are no other contribution other than the contributions payable to the respective funds.

(ii) Defined Benefit Plan :

(a) Fund Plan : The Company has defined benefit plans in the form of gratuity and leave encashment, the liability for which is determined on the basis of acturial valuation at the end of the year. Gains and losses arising out of acturial valuation are recognised immediately to the Profit & Loss Account as income or expenses.

(b) Unfunded Plan : The Company has unfunded Defined Benefit Plans in the form of Compensated Absences, as per Company Policy.

(iii) Other Defined Benefits :

Provision for other defined benefit for long term leave encashment is made based on an independent actuarial valuation on projected unit credit method at the end of each financial year. Acturial gain & losses are recognised immediately in the Statement of Profit & Loss Account as income or expenses. Company recognised the undiscounted amount of short term exployee benefits during the accounting period based on service rendered by an employee.

9) Borrowing Cost

Borrowing costs in relation to acquisition and construction of assets are capitalised as part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which these are incurred.

10) Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred Tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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.

11) Impairment of Assets

The carrying amounts of assets are reveiwed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An Impairment loss will be recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value by using weighted average cost of capital.

 
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