Mar 31, 2014
1.1 Basis of Presentation
The Financial Statements of the Company are prepared under historical cost convention, on accrual basis of accounting to comply in all material respects, with the mandatory Accounting standards as notified by the Companies (Accounting Standards) Rules, 2006 as amended (''the Rules'') and the relevant provisions of the Companies Act, 1956 (''the Act'').
Accounting policies have been consistently applied except where a new accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and 12 months or other criteria as set out in the Schedule VI to the Companies Act, 1956. The operating cycle is a period of production and their realization in cash and cash equivalents.
1.2 Use of Estimates
The preparation of the financial statements are in conformity with the Indian GAAP which requires the management make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements, and the reported amounts of revenue and expenses during the reported period. Actual results could differ from these estimates. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.
1.3 Revenue Recognition
Revenue from the sale of grown/traded items is recognized upon passage of the title to the customers which generally coincides with the delivery and acceptance thereof. Income by way of ''interest'' is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Income by way of ''dividend'' is recognized when the Company''s right to receive dividend is established.
Operating Lease rentals are accounted on the basis of period of lease.
Other income from the sale of duty credit script under Vishesh Krishi and Gram Udyog Yojana has been accounted on the basis of estimated realization of scrips.
1.4 Tangible and Intangible Assets
Tangible Assets are stated at actual cost less accumulated depreciation and impairment if any. The actual cost includes acquisition cost, taxes, duties, wherever apphcable, and all other expenses directly attributable for putting the asset into its intended use.
The cost and accumulated depreciation of tangible assets sold are removed from the stated values and the resultant Profit/Loss has been included in Statement of Profit & Loss.
Biological assets are stated at revalued amount, which is the fair value at the date of revaluation less any accumulated impairment losses. Fair value is determined by market based evidence by appraisal that is carried out by professionally qualified valuer. Revaluation of biological assets are carried out at sufficient regularity and any material differences are adjusted accordingly to ensure that the carrying value of the asset does not differ materially from the fair values determined as at balance sheet date.
Intangible Assets are stated at actual cost less accumulated depreciation. The actual cost includes acquisition cost, taxes, duties, wherever applicable, and all other expenses directly attributable for putting the asset into its intended use.
Depreciation on fixed assets has been provided on "Straight line method at the rates prescribed in Schedule XIV to the Companies Act 1956. Depreciation on additions/disposals of the fixed assets during the year is provided on pro-rata basis according to the period during which assets are put to use / sold. Assets purchased/Installed during the year costing less than Rs. 5,000/- each are fully depreciated.
Biological assets are not depreciated as the same is not covered in Accounting Standard - 6 "Depreciation Accounting".
Investments, which are readily realizable and intended to be held for not more than 1 year from the date on which such investments are made, are classified as a Current Investments. All other investments are classified as non-current investments.
Current inv''estments are carried at the lower of cost and quoted/fair value computed category wise. Long term and strategic investments are stated at cost, less any " diminution in the value other than temporary.
1.7 Foreign Currency Transactions
Transactions in foreign currency are recorded at the exchange rate prevaihng on the date of transaction.
Monetary current assets and liabilities, denominated in foreign currency are translated at the rates of exchange at the balance sheet date and the resultant gain or loss is recognized in tlie Statement of profit and loss.
In accordance with die option given in the Ministry of Corporate Affairs Notification No. GSR 225(E) dated 31 March 2009 and amended from time to time the Exchange fluctuations arising on reporting of long term foreign currency monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements, insofar as they relate to acquisition of a depreciable capital assets, is added to or deducted from the cost of the assets and will be depreciated over the balance life of the asset, and in otlier cases is accumulated in ''Foreign Currency Monetary Item Translation Difference Accounts'' in the Company''s financial statements and amortized over the balance period of such long term asset/liability but not beyond 31 march 2020, by recognition as income or expenses in each such of the period.
Cost of Inventories comprises of all cost of purchase, cost of conversion and other cost incurred m bringing them to their respective present location and condition.
Inventory as physically verified and certified by the management arc valued at cost or market rate whichever is lower using the FIFO method. Raw materials are valued at cost. Stock in trade is valued at the lower of cost or net realizable value. Agricultural produce are valued at net realizable value basis.
1.9 Employee Benefits
Short Term Employee Benefits: The company accounts for short term employee benefits viz., salary, bonus and other allowances as and when the services are rendered by employees i.c., on accrual basis of accounting and dues within 12 months.
'' Defined Contribution Plan:
Provident Fund: Contribution towards provident fund for certain employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a , monthly basis.
Defined Benefit Plan;
Gratuity: The Company provides for Gratuity, a defined benefit retirement plan (Gratuity Plan) covering eligible employees. In accordance with the Payment of Gratuity Act, 1972, the Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary and tenure of employment. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation using project unit credit method as at balance sheet date, based upon which, the Company makes necessary and adequate provisions in the books of accounts. The consequent actuarial gain or loss is expensed in the period of accrual of gain or loss.
Other Long term Benefits:
Compensated Absence: Accumulated compensated absences, which are expected to be availed or encashed within 12 months from the end of the year end are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulating compensated absences as the additional amount expected to be paid as a result of the unused entitlement as at the year end.
Accumulated compensated absences, which are expected to be availed or encashed beyond 12 months from the end of the year are treated as other long term employee benefits. The Company''s liability is actuarially determined using the Projected Unit Credit methods at balance sheet date. Actuarial losses/ gains are recognised in the Statement of Profit and Loss in the year in which they arise.
1.10 Employee Stock Options:
The options are valued, as per SEBI Guidelines "Employee Stock Option Plans/Employee Stock Purchase Plans", based on the fair market value of the shares on the date of grant. The difference between the fair market value of shares and the exercise price would be expensed off in the year of exercise of the options, net off any receipt of amount from the employee towards exercise of the options.
Borrowing costs including exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest cost, that are attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of cost of such asset till such time as the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use or sale. All other borrowing costs are recognized as an expense in the period in which they are incurred
1.12 Earnings per Share:
Basic earnings per equity share arc computed by dividing net profit after lax by weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing adjusted net profit after tax by the aggregate of weighted average number of equity shares and all dilutive potential equity shares.
1.13 Provision for Current Tax and Deferred Income Tax
Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.
Deferred Tax resultiiig from timing difference between book profit and taxable profit is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent there is a reasonable certainty that the asset wiU be realized in future. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized if there is virtual certainty that there will be sufficient future taxable income available to realize such losses. Deferred tax assets and deferred tax liabilities have been offset wherever the company has a legally enforceable right to set off current tax assets against current tax liabilities and where the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation aulliorily.
Minimum Alternative Tax credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax during the specified period.
1.14 Impairment of Assets;
An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the statement of Profit and Loss '' Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.
1.15 Cash and Cash Equivalents.
In the cash flow statement, cash and cash equivalents include cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.
1.16 Provisions, Contingent Liabilities and Contingent Assets:
Provisions are recognized in terms of Accounting Standard - 29: "Provisions, Contingent Liabilities and Contingent Assets", issued by the Institute of Chartered Accountants of India, where there is a present legal or statutory obligation as a result of past events, where it is probable that there will be outflow of resources to settle the obligation and when a reliable estimate of the amount of the obligation can be made.
Contingent Liabilities are recognized only when there is a possible obligation from past events due to occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or where any present obligation cannot be measured in terms of future outflow of resources or where a reliable estimate of the obligation cannot be made. Obligations are assessed on an ongoing basis and only those having a largely probable outflow of resources are provided for.
Contingent Assets are not recognized in the Financial Statements
1.17 Leases As a lessee:
The Company leases certain tangible assets were risks and rewards of ownership are retained by the lesser are classified as operating leases. Payments made under operating leases are charged to the Statement of Profit and Loss on a straight-line basis over the period of the lease.
As a lessor:
The Company has leased certain tangible assets and such leases where the Company has Substantially retained all the risks and rewards of ownership are classified as operating leases. Lease income on such operating leases are recognised in the Statement of Profit and Loss on a straight line basis over the lease term which is representative of the time pattern in which benefit derived from the use of the leased asset is diminished. Initial direct costs are recognised as an expense in the Statement of Profit and Loss in the period in which they are incurred.
Assets held under finance lease are included in the Balance Sheet at cost less depreciation in accordance with the Company''s normal accounting policies. Interest is charged to the profit and loss account over the period of the lease in proportion to the principal sum outstanding.
1.18 Segment Reporting
The accounting policies adopted for segment reporting are in conformity with the accounting policies adopted for preparing and presenting the financial statement of the Company as a whole.
Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses, which relate to the Company as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated corporate revenue/ expenses".