Accounting Policies of M P Agro Industries Ltd. Company

Mar 31, 2019

NOTES TO FINANCIAL STATEMENTS

NOTE ''1''. BANKGROUND

M P Agro Industries Limited (the Company) is a public limited company listed on Bombay Stock Exchange Limited. It was incorporated on 04.12.1975 under the provisions of the Companies Act, 1956. The registered office of the company has been changed to 924, 9th floor, fortune tower, Sayajigunj, Vadodara, Gujarat-390020. The Company''s objects are to carry on in India or in any part of the World all kind of business relating to fertilizers, heavy chemicals and their by-products.

NOTE 2''. SIGNIFICANT ACCOUNTING POLICIES: A. Statement of Compliance:

The financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as notified by the Companies (Indian Accounting Standards) Rules, 2015. Up to the Year ened March 31, 2017, the Company prepared its financial statements in accordance with the requirements of the Standards notified under the Companies (Accounting Standards) Rules, 2006. From 01.04.2017 Ind AS has been applicable. In accordance with Ind AS 101 First - time Adoption of Indian Accounting Standard, from FY 2017-18, the Company has presented a reconciliation from the presentation of financial statements under Acounting Standards notified under the Companies (Accounting Standards) Rules, 2006 ("Previous GAAP") to Ind AS of Shareholders'' equity as at March 31, 2019 and April 1, 2017 and of the Comprehensive net income for the year ended March 31, 2019 and April 1, 2018.

B. Basis of Presentation:

The accounts have been prepared using historical cost convention and on the basis of a going concern, with revenues recognized and expenses accounted for on accrual (including for committed obligations), in accordance with the Indian Accounting Standards prescribed in the Companies (Indian Accounting Standards) Rules, 2015.

C. Property, Plant and Equipment:

a) All the items of property, plant and equipment are stated at historical cost less depreciation. Costs directly attributed to acquisition are capitalized untill the Property, Plant and Equipment are ready for use, as intended by management. Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic benefits sassociated with these will flow to the Company and the cost of the item can be measured reliably.

b) The Company depreciates Property, Plant and Equipment over their estimated useful lives using the straight line method.

c) For transition to Ind AS, the Company has elected to continue with the carrying value of all its property, plant and equipment recognized as of April 1 2017 (transition date) measured as per the previous GAAP and considered that carrying value as its deemed cost as of the transition date.

D. Depreciation:

(a) Depreciation is charged on property, plant and equipment as per the Straight Line Method at the rates and in the manner prescribed under Schedule-II of the Companies Act, 2013.

(b) Depreciation on additions / deductions to the Fixed Assets is being provided on prorata basis from/ to the month of acquisition / disposal.

E. Recognition of Incomes:

a) Revenues/Incomes are generally accounted on accrual, as they are earned.

b) Sale of goods is recognized on transfer of property in goods or on transfer of significant risks and reward of ownership to the buyer, which is generally on dispatch of goods.

c) Interest income is recognized when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on time basis, by reference to the principal outstanding and at the effective rate applicable.

F. Contingencies and Events occurring after the date of Balance Sheet:

a) Accounting for contingencies (gains and losses) arising out of contractual obligations are made only on the basis of mutual acceptance.

b) Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.

G. Impairment of Assets:

The carrying amounts of property, plant and equipment are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An asset is impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

H. Use of Estimates

I. The preparation of financial statements in conformity with INd AS 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 amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognized in the period in which the results are known / materialized.

J. Income Taxes

a) Income tax expense represents the sum of the tax currently payable and deferred tax.

b) Provision for Current tax is made, based on tax estimated to be payable as computed under the various provisions of the Income Tax Act, 1961.

c) Deferred tax is recognized, subject to prudence, on timing differences between taxable income and accounting income that originate during the year and are capable of being reversed in one or more subsequent periods. Deferred tax assets are recognized only to the extent that there is reasonable certainty that future taxable income will be available against which such deferred tax assets can be realized.

d) Deferred Tax Liabilities / Assets are quantified using the tax rates and tax laws enacted or substantively enacted as on the date of the financial statements.

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Mar 31, 2014

A. Basis of Presentation

The accounts have been prepared using historical cost convention and on the basis of a going concern, with revenues recognized and expenses accounted for on accrual (including for committed obligations), in accordance with the accounting standard prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government, in consultation with the National Advisory Committee on Accounting Standards, to the extent applicable. Insurance and other claims are accounted for, as and when admitted by the appropriate authorities.

B. Fixed Assets

a. Capitalized at acquisition cost including directly attributable cost such as freight insurance and specific installation charge for bringing the asset to its working condition for use

b. Expenditure relating to existing fixed assets is added to the cost of the assets where it increases the performance/life of the assets as assessed earlier.

C. Depreciation

a) Depreciation is charged on Other Assets as per the Straight Line Method from the date of installation/use asset at the rates and in the manner prescribed under schedule X1V to the Companies Act, 1956.

b) Depreciation on additions / deductions to the Fixed Assets is being provided on prorata basis from/ to the month of acquisition / disposal.

D. Investments

Long Term Investments are stated at cost less provision, if any, for decline other than temporary in their value.

E. Recognition of Incomes

a) Revenues/Incomes are generally accounted on accrual, as they are earned.

b) Sale of goods is recognized on transfer of property in goods or on transfer of significant risks and reward of ownership to the buyer, which is generally on dispatch of goods.

F. Contingencies and Events occurring after the date of Balance Sheet

a) Accounting for contingencies (gains and losses) arising out of contractual obligations are made only on the basis of mutual acceptance.

b) Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.

G. 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 asset is impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

H. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognized in the period in which the results are known/materialized.

I. Accounting for Taxes on Income

a) Provision for taxation for the year under report includes provision for current tax as well as provision for deferred tax.

b) Provision for Current tax is made, based on tax estimated to be payable as computed under the various provisions of the Income Tax Act, 1961.

c) Deferred tax is recognised, subject to prudence, on timing differences between taxable income and accounting income that originate during the year and are capable of being reversed in one or more subsequent periods. Deferred tax assets are recognised only to the extent that there is reasonable certainty that future taxable income will be available against which such deferred tax assets can be realized.

d) Deferred Tax Liabilities / Assets are quantified using the tax rates and tax laws enacted or substantively enacted as on the balance sheet date.

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Mar 31, 2010

1. SYSTEM OF ACCOUNTING

The company adopts the accrual concept in preparation of accounts.

2. REVENUE RECOGNITION

Assets and liabilities are recorded at historical cost to the company. The costs are not adjusted to reflect the changes in the purchasing power of money.

3. INFLATION

Assets and liabilities are recorded at historical cost to the company. The costs are not adjusted to reflect the changes in the purchasing power of money.

4. FIXED ASSETS

Fixed Assets are capitalized at cost inclusive of installation expenses.

5. INVENTORIES

a. Stores and spares, packing materials, raw materials and stock in process are evaluated at cost and on the basis of first- in - first-out.

b. Stocks of used bags are evaluated on basis of estimated selling price.

c. Finished goods, whether I stock at factory or at other places are evaluated on the basis of cost or selling price, whichever is lower.

6. DEPRECIATION

- Depreciation on Fixed Assets up to 31st December, 1987 is provided on straight line method, at the rates applicable under the income tax rates as in for at the time of acquisition / purchase of assets.

- Depreciation on Fixed assets form 1st January, 1988 has been provided on straight- line method at the rates specified in Schedule - XIV of the Companies Act, 1956 as amended with effect form 16.12.93.

- No depreciation is charged on the Fixed Assets during the financial year as the company has closed its operations during the immediately preceding previous financial year.

7. MISCELLANEOUS EXPENDITURE

Shares issue expenses has been written off 1710th every year.