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Accounting Policies of Krishana Fabrics Ltd. Company

Mar 31, 2015

1.1 Basis of Accounting and preparation of Financial Statements

These financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, till the Standards of Accounting or any other addendum thereto are prescribed by Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing Accounting Standards notified under the Companies Act 1956 (the Act) shall continue to apply. Consequently, these financial statements are prepared to comply in all material aspects with the Accounting Standards notified under sub section (3C) of Section 211 of the Act {Companies (Accounting Standards) Rules, 2006} and other relevant provisions of the Companies Act 2013.

1.2 Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known /materialised.

1.3 Inventories

Inventories are valued at the lower of cost (on FIFO basis) and the net realisable value after providing for obsolescence and other losses, where considered necessary.

1.4 cash and cash equivalents (for purposes of cash Flow statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short- term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known of cash and which are subject to insignificant risk of changes in value.

1.5 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.

1.6 Revenue Recognition

All incomes and expenditure are recognised as per 'Accounting Standard - 9' accounted on accrual basis except where stated otherwise.

1.7 employee Benefits

a. P.F. and E.S.I.C. Scheme is not applicable to the company.

b. Provision of Gratuity is done when an employee works for more than 6 months.

1.8 segment reporting:

The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal organisation and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identifies to segments on the basis of their relationship to the operating activities of the segment.

Inter-segment revenue is accounted on the basis of transactions which are primarily determined based on market/fair value factors.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities"

1.9 Investments:

Long-term investments are carried individually at cost less provision for diminution, other than temporary, in the value of such investments.

Current investments are carried individually, at the lower of cost and fair value. Costs of investments include acquisition charges such as brokerage, fees and duties.

1.10 Borrowing Cost:

Borrowing costs directly attributable to the acquisition and construction fo qualifying fixed assets are capitalized as part of the cost of the assets, up to the date the asset is put to use. Other borrowing costs are charged to the Profit and Loss Account.

1.11 Taxes on Income:

Current Tax is determined as the tax payable in respect of taxable income for the year, if any. Deferred tax for the year is recognised on timing difference; being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred Tax Assets and Liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Tax Assets are recognised and carried forward only if there is a reasonable/virtual certainty of realisation.

1.12 Provisions and Contingencies:

A provision is recognised when the Company has a 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. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

1.13 impairment of Assets:

At the end of each years, the Company assesses whether any impairment loss may have occurred in respect of its Assets in accordance with Accounting Standard - 28 "Impairment of Assets" issued by the Institute of Chartered Accountants of India, and Impairment Losses if any are accounted for by the Company in accordance with the Standard applicable.


Mar 31, 2014

1) Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.

2) System of Accounting

The accounts of the Company are prepared under the historical cost convention using the accrual method of accounting.

3) Fixed Assets

* Fixed Assets are carried at cost less accumulated depreciation.

* Depreciation on Fixed Assets has been provided under written down value method on pro-rata basis as per rate prescribed under Schedule XIV of the Companies Act, 1956.

4) Investments

Investments, being long term, have been valued at cost less permanent diminution in value, if any. Diminution in value of investment has been considered as temporary in nature.

5) Inventories

Inventories are valued at lower of cost or market price.

6) Recognition of Income and Expenditure

* Revenue / Incomes and Costs / Expenditure are generally accounted on accrual, as they are earned or incurred.

* Sale of Goods is recognised on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods.

7) Taxes on Income

* Provision of current tax is made with reference to taxable income computed for the accounting period for which the financial statements are prepared by applying the tax rates as applicable.

* Deferred Tax Liabilities is recognised on the basis of timing differences being the difference between taxable income that originate in one period and is capable of reversal in one or more subsequent years. The deferred tax charge is recognized using the enacted tax rate. Deferred Tax Assets are recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized. 0 Deferred Tax Assets/Liabilities are reviewed as at balance sheet date based on the developments during the year and reassess assets/liabilities in terms of AS-22 issued by ICAI.

8) Compliance of Accounting Standards issued by the Institute of Chartered Accountants of India.

(A) Segment Reporting:

Segmental Reporting as per AS-17 is not applicable.

(B) Related Party Disclosures:

In terms of Accounting Standard 17 of the ICAI related party transactions as well as payment to director is as under:

Related Party Relationship Nature of Transaction

Anitha Mahesh Director Not Any

Bhagyashree Chordia Director Not Any

Mukesh Puranmal Director Not Any

P. D. Mathran* Director Not Any

Manoj Kr. Singh* Director Not Any

Rakesh Kumar* Director Not Any

Related Party 2013-2014 2012-2013

Anitha Mahesh 0 0

Bhagyashree Chordia 0 0

Mukesh Puranmal 0 0

P. D. Mathran* 0 0

Manoj Kr. Singh* 0 0

Rakesh Kumar* 0 0

* Resigned w.e.f. 15th February 2014

9) Contingent Liabilities

There is no contingent liability during the year.

10) Presentation and disclosure of financial statements

During the year ended 31st March 2014 the Revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company, for preparation and presentation of its financial statement. The adoption of Revised Schedule VI does not impact recognition and measurement of principle followed for preparation of financial statement. However it has significant impact on presentation and disclosures made in the financial statement. The company has also reclassified the previous year figures in accordance with the requirement applicable in current year.


Mar 31, 2013

1. Basis of Accounting:

The financial statements have been prepared in accordance with the historical cost convention under mercantile system of accounting.

2. Revenue Recognition:

a. Purchase and sales of equity shares are recognized on the basis of payment for the same to / from brokers.

b. Income from investment is recognized as and when received.

c. Interest on loans is recognized on accrual basis.

3. Inventories:

Inventories are valued at cost.

4. Contingent Liability;

Contingent Liabilities are not provided for in the accounts but disclosed by the way of notes in notes on account.


Mar 31, 2012

1. Basis of Accounting: The financial statements have been prepared in accordance with the historical cost convention under mercantile system of accounting,

2. Revenue Recognition:

a. Purchases and sales of equity shares are recognized on the basis of payment for the same to / from brokers.

b. Income from investment is recognized as and when received.

c. Interest on loans is recognized on accrual basis.

3. Inventories: Inventories are valued at cost.

4. Contingent Liability: Contingent liabilities are not provided for in the accounts but are disclosed by the way of notes in notes on account.