Mar 31, 2018
1.1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a) Property, Plant and Equipment (PPE)
i) The company has elected to avail the exemption granted by Ind AS 101 âFirst Time Adoption of the Indian Accounting Standardsâ to continue with the carrying value for all of its Property, Plant and Equipment as recognised in the financial statements as at the date of transition to Ind ASs, measured as per the previous GAAP and use that as its deemed cost as at the date of transition (i.e. as on April 1, 2016).
ii) Property, plant and equipment held for use in the production or supply of goods or services, or for administrative purposes, are stated in the balance sheet at cost less accumulated depreciation and accumulated impairment loss. Cost includes all expenses directly incidental to acquisition, bringing the asset to the location and installation including site restoration up to the time when the asset is ready for intended use. Such Costs also include Borrowing Cost if the recognition criteria are met.
iii) The residual values, useful lives and method of depreciation of property, plant and equipment is reviewed at each financial year end and adjusted prospectively.
iv) Depreciation
Depreciation on Property, Plant & Equipment is provided on Straight Line Method based on estimated useful life of the assets which is same as envisaged in schedule II of the Companies Act, 2013. The residual values, useful lives and method of depreciation of property, plant and equipment is reviewed at each financial year end and adjusted prospectively, if appropriate
v) De-recognition
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss
b) Intangible assets
i) The company has elected to avail the exemption granted by Ind AS 101 âFirst Time Adoption of the Indian Accounting Standardsâ to continue with the carrying value for all of its Intangible Assets as recognised in the financial statements as at the date of transition to Ind ASs, measured as per the previous GAAP and use that as its deemed cost as at the date of transition (i.e. as on April 1, 2016).
ii) Intangible assets which is purchased are initially measured at cost. Subsequently, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses, if any
iii) An item of Intangible asset is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the Statement of Profit and Loss when the asset is derecognised.
iv) Amortisation
Finite-life intangible assets are amortised on a straight-line basis over the period of their expected useful lives.
Estimated useful life of computer software is estimated for 3 year
c) Impairment of non financial assets
At the end of each reporting period, the Company determines whether there is any indication that its assets (property, plant and equipment, intangible assets carried at cost) have suffered an impairment loss with reference to their carrying amounts. If any indication of impairment exists, the recoverable amount (i.e. higher of the fair value less costs of disposal and value in use) of such assets is estimated and impairment is recognised, if the carrying amount exceeds the recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money
d) Financial Assets
i) Initial Recognition and Measurement
All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Financial assets are classified, at initial recognition, as financial assets measured at fair value or as financial assets measured at amortized cost.
ii) Subsequent Measuremen
For purpose of subsequent measurement financial assets are classified in two broad categories:-
(i) Financial assets at amortized cost
(ii) Financial Assets at fair value through profit or loss
(iii) Financial Assets at fair value through other comprehensive income (OCI)
A financial asset that meets the following two conditions is measured at amortized cost:
i) Business Model Test: The objective of the companyâs business model is to hold the financial asset to collect the contractual cash flows
ii) Cash flow characteristics test: The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payment of principal and interest on the principal amount outstanding.
A financial asset that meets the following two conditions is measured at fair value through OCI:-
- Business Model Test: The financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.
- Cash flow characteristics test: The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payment of principal and interest on the principal amount outstanding.
All equity investments are measured at fair value in the balance sheet, with value changes recognized in the statement of profit and loss, except for those equity investments for which the entity has elected irrevocable option to present value changes in OCI All other financial assets are measured at fair value through profit and loss Where assets are measured at fair value through profit of loss, gains and losses are recognized in the statement of profit and loss Where assets are measured at fair value through other comprehensive income, gains and losses are recognized in other comprehensive income
iii) Impairment of financial assets
The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk and if so, assess the need to provide for the same in the Statement of Profit and Loss.
iv) Derecognition of financial assets
A financial asset is derecognised only when Company has transferred the rights to receive cash flows from the financial asset. Where the entity has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognised
e) Financial Liabilities
i) Initial recognition and measurement
Financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities are initially measured at the amortised cost unless at initial recognition, they are classified as fair value through profit and loss. In case of trade payables, they are initially recognised at fair value and subsequently, these liabilities are held at amortised cost, using the effective interest method.
ii) Subsequent measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognised in the Statement of Profit and Loss.
iii) Derecognition
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or expires.
f) Leases
Finance leases, which effectively transfer to the Company substantially all the risks and benefits incidental to ownership of the leased asset, are capitalized at the lower of the fair value and present value of the minimum lease payments at the inception of the lease term and disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liability based on the implicit rate of return. Finance charges are recognized as finance costs in the statement of profit and loss.
A leased asset is depreciated on a straightline basis over the lower of the lease term or the estimated useful life of the asset unless there is reasonable certainty that the Company will obtain ownership, wherein such assets are depreciated over the estimated useful life of the asset.
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.
g) Inventory
Inventories are valued at the lower of cost and net realisable value.
Cost of Raw material: Inventory items that are not interchangeable, specific cost are attributed for specific individual items of inventory. Inventory items that are interchangeable, cost are attributed to these inventory items on FIFO Basis.
Cost of Finished goods and WIP: Cost of finished goods and work in progress include weighted average costs of raw materials, conversion costs and other costs incurred in bringing the inventories to their present location and condition.
The net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and estimated costs necessary to make the sale.
h) Income Tax
Provision for tax is made for the current accounting period (reporting period) on the basis of the taxable profits computed in accordance with the I ncome-tax Act, 1961 and the Income Computation and Disclosure Standards prescribed therein.
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes.
A deferred tax liability is recognised based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted, or substantively enacted, by the end of the reporting period. Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognised amounts. Deferred tax assets and deferred tax liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities; and the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority
i) Provisions and contingent liabilities
The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
Disputed liabilities and claims against the company including claims raised by fiscal authorities (e.g. Sales Tax, Income Tax, Excise etc.) pending in appeal / court for which no reliable estimate can be made and or involves uncertainty of the outcome of the amount of the obligation or which are remotely poised for crystallization are not provided for in accounts but disclosed in notes to accounts
j) Foreign Currency Translation
i) The financial statements are presented in Indian rupee (INR), which is Companyâs functional and presentation currency.
ii) On initial recognition, all foreign currency transactions are recorded at foreign exchange rate on the date of transaction. Gain / Loss arising on account of rise or fall in foreign currencies vis-a-vis functional currency between the date of transaction and that of payment is charged to Statement of Profit & Loss.
iii) Monetary Assets in foreign currencies are translated into functional currency at the exchange rate ruling at the Reporting Date and the resultant gain or loss, is accounted for in the Statement of Profit & Loss
k) Dividend to equity holders of the Company
The Company recognises a liability to make cash distributions to equity holders of the Company when the distribution is authorised and the distribution is no longer at the discretion of the Company. Final dividends on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Companyâs Board of Directors.
l) Revenue Recognition
i) Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of GST, value added taxes, service tax, discounts, rebates and incentives. Sales are recognised on transfer of significant risks and rewards of ownership to the buyer, which generally coincides with the dispatch of goods from the factory gate on the basis of tax invoice in the case of domestic sales. Export sales are recognised on transfer of significant risks and rewards of ownership to the buyer.
Sales exclude sales tax/GST, value added tax.The materials returned/ rejected are accounted for in the year of return/rejection.
ii) Export incentives & other miscellaneous incomes are recognised on accruel basis. Export benefits are accounted for in the year of exports based on eligibility and when there is no uncertainty in receiving the same.
iii) All other income including interest income are recognised on accrual basis
m) Employee benefits
i) Short-term employee benefits
All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Short term employee benefits such as salaries, alloawances, performance incentives, etc., are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the employee renders the related service
ii) Post Employment Benefits Defined contribution plans
Payments made to a defined contribution plan such as Companyâs contribution to provident fund, employee state insurance and other funds are determined under the statute and charged to the Statement of Profit and Loss in the period of incurrence when the services are rendered by the employees.
iii) Defined Benefits Plans
The Company makes annual contributions to gratuity funds administered by the L.I.C.. The Gratuity plan provides for lump sum payment to vested employees on retirement, death or termination of employment of an amount based on the respective employeeâs last drawn salary and tenure of employment. The Company accounts for the net present value of its obligations for gratuity benefits, based on an independent actuarial valuation, determined on the basis of the projected unit credit method, carried out as at the Balance Sheet date. The obligation determined as aforesaid less the fair value of the plan assets is reported as a liability or assets as of the reporting date. Actuarial gains and losses are recognised immediately in the Other Comprehensive Income and reflected in retained earnings and will not be reclassified to the Statement of Profit and Loss.
n) Borrowing Cost
Borrowing cost that are directly attributable to the acquisition, construction, or production of a qualifying asset are capitalized as a part of the cost of such asset till such time the asset is ready for its intended use or sale
Borrowing cost consist of interest and other costs that an entity incurs in connection with the borrowing of funds. 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 cost are recognized as expense in the period in which they are incurred
o) Earning Per Share
Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Earnings considered in ascertaining the Companyâs earnings per share is the net profit for the period. The weighted average number of equity shares outstanding during the period and all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of share outstanding during the period is adjusted for the effects of all dilutive potential equity shares.
p) Segment reporting
The activity of the company comprises of only manufacturing and trading of aluminium products hence there is no other reportable operating segment as required by Ind AS -108.
q) Cash and cash equivalents
Cash and cash equivalents are short-term (three months or less from the date of acquisition), highly liquid investments that are readily convertible into cash and which are subject to an insignificant risk of changes in value.
Mar 31, 2017
A Basis of Preperation of Financial Statements
These financial statements of the Company have been prepared been prepared in accordance with the 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 section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention.
B 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 recognized in the periods in which the results are known / materialize.
C Inventories
Items of Inventories are valued at the lower of cost (on FIFO basis) and the net realizable value. Cost includes all direct costs and applicable production overheads in bringing the goods to the present location and condition.
D Depreciation and amortization
Depreciation on fixed assets is provided on the straight-line method based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013
E Revenue recognition
i Sale of goods
Sales are recognized on transfer of significant risks and rewards of ownership to the buyer, which generally coincides with the dispatch of goods from the factory gate on the basis of excise invoice in the case of domestic sales. Export sales are recognized on transfer of significant risks and rewards of ownership to the buyer. Sales include excise duty but exclude sales tax, value added tax and trade discounts. The materials returned/rejected are accounted for in the year of return/ rejection.
ii Income from services
Revenues from contracts priced on a time and material basis are recognized when services are rendered and related costs are incurred.
iii Export incentives & other miscellaneous incomes are recognized on accruel basis. Export benefits are accounted for in the year of exports based on eligibility and when there is no uncertainty in receiving the same.
iv Interest income is accounted on time proportion basis taking into account the amount outstanding and the rate applicable
F Fixed assets
Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalized and depreciated over the useful life of the principal item of the relevant assets. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.
G Foreign currency transactions and translations
i Initial recognition
Transactions in foreign currencies entered into by the Company are accounted for at the exchange rates prevailing on the date of the transaction.
ii Measurement of foreign currency monetary items at the Balance Sheet date
Foreign currency monetary items (other than derivative contracts) of the Company outstanding at the Balance Sheet date are restated at the year-end rates.
iii Treatment of exchange differences
Exchange differences arising on settlement / restatement of short-term foreign currency monetary assets and liabilities of the Company are recognized as income or expense in the Statement of Profit and Loss. The exchange differences arising on restatement / settlement of long-term foreign currency monetary items are capitalized as part of the depreciable fixed assets to which the monetary item relates and depreciated over the remaining useful life of such assets.
iv Accounting of forward contracts
The Company uses foreign exchange forward and options contracts to hedge its exposure to movements in foreign exchange rates. The use of these foreign exchange forward and options contracts reduces the risk or cost to the Company The Company does not use those for trading or speculation purposes. The resultant gain or loss from these transactions is recognized in the statement of Profit and Loss.
H Employee benefits
Employee benefits include provident fund, gratuity fund, compensated absences.
i Defined contribution plans
The Companyâs contribution to provident fund and Employees State Insurance Scheme are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.
ii Defined benefit plans
For defined benefit plans in the form of gratuity fund and compensated absences, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognized in the Statement of Profit and Loss in the period in which they occur. The retirement benefit obligation recognized in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognized past service cost, as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.
iii Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognized during the year when the employees render the service. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service. The cost of such compensated absences is accounted as under :(a) in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and(b) in case of non-accumulating compensated absences, when the absences occur.
iv long-term employee benefits
Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognized as a liability at the present value of the defined benefit obligation as at the Balance Sheet date.
I Borrowing costs
Borrowing costs that are attributable to the acquisition of qualifying assets are capitalized as part of cost of such assets until its ready for its intended use. All other borrowing costs are charged to revenue and recognized as an expense in the statement of profit and loss.
J Segment reporting
The activity of the company comprises of only manufacturing of aluminium products hence there is no other reportable segment as required by accounting standard- 17 on âSegment Reportingâ issued by the Institute of Chartered Accountants of India.
K Earnings per share
Basic earnings per share is computed by dividing the profit after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of equity and dilutive equivalent shares outstanding during the year.
L Taxes on income
Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.Deferred tax resulting from âtiming differenceâ between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. Deferred tax asset is recognized and carried forward only to the extent that there is a virtual certainty that the asset will be realized in future.
M Impairment of assets
The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognized, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognized for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognized in the Statement of Profit and Loss, except in case of revalued assets.
N Provisions and contingencies
A provision is recognized 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. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelyhood of outflow of resources is remote, no provision or disclosure is made.
Mar 31, 2015
A Basis of Preparation of Financial Statements
These financial statements of the Company have been prepared been
prepared in accordance with the 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 section 133 of the Companies Act
2013, read together with paragraph 7 of the Companies (Accounts) Rules
2014. The financial statements have been prepared on an accrual basis
and under the historical cost convention.
B 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 / materialise.
C Inventories
Items of Inventories are valued at the lower of cost (on FIFO basis)
and the net realisable value. Cost includes all direct costs and
applicable production overheads in bringing the goods to the present
location and condition.
D Depreciation and amortisation
Depreciation on fixed assets is provided on the straight-line method
based on useful life of the assets as prescribed in Schedule II to the
Companies Act, 2013 E Revenue recognition
i Sale of goods
Sales are recognised on transfer of significant risks and rewards of
ownership to the buyer, which generally coincides with the dispatch of
goods from the factory gate on the basis of excise invoice in the case
of domestic sales. Export sales are recognised on transfer of
significant risks and rewards of ownership to the buyer. Sales include
excise duty but exclude sales tax, value added tax and trade discounts.
The materials returned/rejected are accounted for in the year of
return/rejection.
ii Income from services
Revenues from contracts priced on a time and material basis are
recognised when services are rendered and related costs are incurred.
iii Export incentives & other miscellaneous incomes are recognised on
accruel basis. Export benefits are accounted for in the year of exports
based on eligibility and when there is no uncertainty in receiving the
same.
iv Interest income is accounted on time proportion basis taking into
account the amount outstanding and the rate applicable
F Fixed assets
Fixed assets are carried at cost less accumulated depreciation and
impairment losses, if any. The cost of fixed assets includes interest
on borrowings attributable to acquisition of qualifying fixed assets up
to the date the asset is ready for its intended use and other
incidental expenses incurred up to that date. Exchange differences
arising on restatement / settlement of long-term foreign currency
borrowings relating to acquisition of depreciable fixed assets are
adjusted to the cost of the respective assets and depreciated over the
remaining useful life of such assets. Machinery spares which can be
used only in connection with an item of fixed asset and whose use is
expected to be irregular are capitalised and depreciated over the
useful life of the principal item of the relevant assets. Subsequent
expenditure relating to fixed assets is capitalised only if such
expenditure results in an increase in the future benefits from such
asset beyond its previously assessed standard of performance.
G Foreign currency transactions and translations
i Initial recognition
Transactions in foreign currencies entered into by the Company are
accounted for at the exchange rates prevailing on the date of the
transaction.
ii Measurement of foreign currency monetary items at the Balance Sheet
date Foreign currency monetary items (other than derivative contracts)
of the Company outstanding at the Balance Sheet date are restated at
the year-end rates.
iii Treatment of exchange differences
Exchange differences arising on settlement / restatement of short-term
foreign currency monetary assets and liabilities of the Company are
recognised as income or expense in the Statement of Profit and Loss.The
exchange differences arising on restatement / settlement of long-term
foreign currency monetary items are capitalised as part of the
depreciable fixed assets to which the monetary item relates and
depreciated over the remaining useful life of such assets.
iv Accounting of forward contracts
The Company uses foreign exchange forward and options contracts to hedge
its exposure to movements in foreign exchange rates. The use of these
foreign exchange forward and options contracts reduces the risk or cost
to the Company. The Company does not use those for trading or
speculation purposes. The resultant gain or loss from these transactions
is recognized in the statement of Profit and Loss.
H Employee benefits
Employee benefits include provident fund, gratuity fund, compensated
absences.
i Defined contribution plans
The Company's contribution to provident fund and Employees State
Insurance Scheme are considered as defined contribution plans and are
charged as an expense as they fall due based on the amount of
contribution required to be made.
ii Defined benefit plans
For defined benefit plans in the form of gratuity fund and compensated
absences, the cost of providing benefits is determined using the
Projected Unit Credit method, with actuarial valuations being carried
out at each Balance Sheet date. Actuarial gains and losses are
recognised in the Statement of Profit and Loss in the period in which
they occur. The retirement benefit obligation recognised in the Balance
Sheet represents the present value of the defined benefit obligation as
adjusted for unrecognised past service cost, as reduced by the fair
value of scheme assets. Any asset resulting from this calculation is
limited to past service cost, plus the present value of available
refunds and reductions in future contributions to the schemes.
iii Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees are recognised
during the year when the employees render the service. These benefits
include performance incentive and compensated absences which are
expected to occur within twelve months after the end of the period in
which the employee renders the related service. The cost of such
compensated absences is accounted as under :(a) in case of accumulated
compensated absences, when employees render the services that increase
their entitlement of future compensated absences; and(b) in case of
non-accumulating compensated absences, when the absences occur.
iv long-term employee benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related service are recognised as a liability at the present value of
the defined benefit obligation as at the Balance Sheet date.
I Borrowing costs
Borrowing costs that are attributable to the acquisition of qualifying
assets are capitalised as part of cost of such assets until its ready
for its intended use. All other borrowing costs are charged to revenue
and recognised as an expense in the statement of profit and loss.
J Segment reporting
The activity of the company comprises of only manufacturing of
aluminium products hence there is no other reportable segment as
required by accounting standard- 17 on "Segment Reporting" issued by
the Institute of Chartered Accountants of India.
K Earnings per share
Basic earnings per share is computed by dividing the profit after tax
by the weighted average number of equity shares outstanding during the
year. Diluted earnings per share are computed using the weighted
average number of equity and dilutive equivalent shares outstanding
during the year.
L Taxes on income
Current tax is the amount of tax payable on the taxable income for the
year as determined in accordance with the provisions of the Income Tax
Act, 1961.Deferred tax resulting from "timing difference" between
taxable and accounting income is accounted for using the tax rates and
laws that are enacted or substantively enacted as on the balance sheet
date. Deferred tax asset is recognised and carried forward only to the
extent that there is a virtual certainty that the asset will be
realised in future.
M Impairment of assets
The carrying values of assets / cash generating units at each Balance
Sheet date are reviewed for impairment. If any indication of impairment
exists, the recoverable amount of such assets is estimated and
impairment is recognised, if the carrying amount of these assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use. Value in use is
arrived at by discounting the future cash flows to their present value
based on an appropriate discount factor. When there is indication that
an impairment loss recognised for an asset in earlier accounting
periods no longer exists or may have decreased, such reversal of
impairment loss is recognised in the Statement of Profit and Loss,
except in case of revalued assets.
N 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. A disclosure for a contingent liability is
made when there is a possible obligation or a present obligation that
may, but probably will not, require an outflow of resources. When there
is a possible obligation or a present obligation in respect of which the
likelyhood of outflow of resources is remote, no provision or disclosure
is made.
Mar 31, 2014
A Basis of Preperation 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 notified under Section 211(3C) of the Companies
Act, 1956. Pursuant to Circular 15/ 2013 dated 13th September, 2013
read with circular 08/ 2014 dated 4th April, 2014, till the standards
of Accounting or any 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 shall continue to apply. Consequently, these
financial statements have been prepared to comply in all material
aspects with the accounting standards notified under Section 211(3C)
[Companies (Accounting Standards) Rules, 2006, as amended] and other
relevant provisions of the Companies Act, 1956.
B 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 / materialise.
C Inventories
Items of Inventories are valued at the lower of cost (on FIFO basis)
and the net realisable value. Cost includes all direct costs and
applicable production overheads in bringing the goods to the present
location and condition.
D Depreciation and amortisation
Depreciation has been provided on the straight-line method as per the
rates prescribed in Schedule XIV to the Companies Act, 1956.
E Revenue recognition
i Sale of goods
''Sales are recognised on transfer of significant risks and rewards of
ownership to the buyer, which generally coincides with the dispatch of
goods from the factory gate on the basis of excise invoice in the case
of domestic sales. Export sales are recognised on transfer of
significant risks and rewards of ownership to the buyer. Sales include
excise duty but exclude sales tax, value added tax and trade discounts.
The materials returned/rejected are accounted for in the year of
return/rejection.
ii Income from services
Revenues from contracts priced on a time and material basis are
recognised when services are rendered and related costs are incurred.
iii Export incentives & other miscellaneous incomes are recognised on
accruel basis. Export benefits are accounted for in the year of exports
based on eligibility and when there is no uncertainty in receiving the
same.
iv Interest income is accounted on time proportion basis.
F Fixed assets
Fixed assets are carried at cost less accumulated depreciation and
impairment losses, if any. The cost of fixed assets includes interest
on borrowings attributable to acquisition of qualifying fixed assets up
to the date the asset is ready for its intended use and other
incidental expenses incurred up to that date. Exchange differences
arising on restatement / settlement of long-term foreign currency
borrowings relating to acquisition of depreciable fixed assets are
adjusted to the cost of the respective assets and depreciated over the
remaining useful life of such assets. Machinery spares which can be
used only in connection with an item of fixed asset and whose use is
expected to be irregular are capitalised and depreciated over the
useful life of the principal item of the relevant assets. Subsequent
expenditure relating to fixed assets is capitalised only if such
expenditure results in an increase in the future benefits from such
asset beyond its previously assessed standard of performance.
G Foreign currency transactions and translations
i Initial recognition
Transactions in foreign currencies entered into by the Company are
accounted for at the exchange rates prevailing on the date of the
transaction.
ii Measurement of foreign currency monetary items at the Balance Sheet
date Foreign currency monetary items (other than derivative contracts)
of the Company outstanding at the Balance Sheet date are restated at
the year-end rates.
iii Treatment of exchange differences
Exchange differences arising on settlement / restatement of short-term
foreign currency monetary assets and liabilities of the Company are
recognised as income or expense in the Statement of Profit and Loss.
The exchange differences arising on restatement / settlement of
long-term foreign currency monetary items are capitalised as part of
the depreciable fixed assets to which the monetary item relates and
depreciated over the remaining useful life of such assets.
iv Accounting of forward contracts
The Company uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use of
these foreign exchange forward and options contracts reduces the risk
or cost to the Company. The Company does not use those for trading or
speculation
purposes. The resultant gain or loss from these transactions is
recognized in the statement of Profit and Loss.
H Employee benefits
Employee benefits include provident fund, gratuity fund, compensated
absences. i Defined contribution plans
The Company''s contribution to provident fund and Employees State
Insurance Scheme are considered as defined contribution plans and are
charged as an expense as they fall due based on the amount of
contribution required to be made. ii. Defined benefit plans
For defined benefit plans in the form of gratuity fund and compensated
absences, the cost of providing benefits is determined using the
Projected Unit Credit method, with actuarial valuations being carried
out at each Balance Sheet date. Actuarial gains and losses are
recognised in the Statement of Profit and Loss in the period in which
they occur. The retirement benefit obligation recognised in the Balance
Sheet represents the present value of the defined benefit obligation as
adjusted for unrecognised past service cost, as reduced by the fair
value of scheme assets. Any asset resulting from this calculation is
limited to past service cost, plus the present value of available
refunds and reductions in future contributions to the schemes.
iii Short-term employee benefits
''The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees are recognised
during the year when the employees render the service. These benefits
include performance incentive and compensated absences which are
expected to occur within twelve months after the end of the period in
which the employee renders the related service. The cost of such
compensated absences is accounted as under:
(a) in case of accumulated compensated absences, when employees render
the services that increase their entitlement of future compensated
absences; and
(b) in case of non-accumulating compensated absences, when the absences
occur.
iv Long-term employee benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related service are recognised as a liability at the present value of
the defined benefit obligation as at the Balance Sheet date.
I Borrowing costs
Borrowing costs that are attributable to the acquisition of qualifying
assets are capitalised as part of cost of such assets until its ready
for its intended use. All other borrowing costs are charged to revenue
and recognised as an expense in the statement of profit and loss.
J Segment reporting
The activity of the company comprises of only manufacturing of
aluminium products hence there is no other reportable segment as
required by accounting standard- 17 on "Segment Reporting" issued by
the Institute of Chartered Accountants of India. K Earnings per share
Basic earnings per share is computed by dividing the profit after tax
by the weighted average number of equity shares outstanding during the
year. Diluted earnings per share are computed using the weighted
average number of equity and dilutive equivalent shares outstanding
during the year.
L Taxes on income
Current tax is the amount of tax payable on the taxable income for the
year as determined in accordance with the provisions of the Income Tax
Act, 1961. Deferred tax resulting from "timing difference" between
taxable and accounting income is accounted for using the tax rates and
laws that are enacted or substantively enacted as on the balance sheet
date. Deferred tax asset is recognised and carried forward only to the
extent that there is a virtual certainty that the asset will be
realised in future.
M Impairment of assets
In accordance with Accounting Standard (AS) 28 on ''Impairment of
Assets'' as notified by the Central Government under the Companies Act,
1956, the carrying amounts of the Company''s assets are reviewed at each
balance sheet date to determine whether there is any impairment. The
recoverable amount of the assets is estimated as the higher of its net
selling price and its value in use. An impairment loss is recognised
whenever the carrying amount of an asset or a cash-generating unit
exceeds its recoverable amount. Impairment loss is recognised in the
Statement of Profit and Loss or against revaluation surplus where
applicable.
N 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.
A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that may, but probably will
not, require an outflow of resources. When there is a possible
obligation or a present obligation in respect of which the likelyhood
of outflow of resources is remote, no provision or disclosure is made.
Mar 31, 2013
A Basis of Preperation of Financial Statements :
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards notified under
the Companies (Accounting Standards) Rules, 2006 (as amended) and the
relevant provisions of the Companies Act, 1956. The financial
statements have been prepared on accrual basis under the historical
cost convention and the accounting policies adopted in the preparation
of the financial statements are consistent with those followed in the
previous year.
B 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 / materialise.
C Inventories
Items of Inventories are valued at the lower of cost (on FIFO basis)
and the net realisable value. Cost includes all direct costs and
applicable production overheads in bringing the goods to the present
location and condition.
D Depreciation and amortisation
Depreciation has been provided on the straight-line method as per the
rates prescribed in Schedule XIV to the Companies Act, 1956
E Revenue recognition
i Sale of goods
Sales are recognised on transfer of significant risks and rewards of
ownership to the buyer, which generally coincides with the dispatch of
goods from the factory gate on the basis of excise invoice in the case
of domestic sales. Export sales are recognised on transfer of
significant risks and rewards of ownership to the buyer. Sales include
excise duty but exclude sales tax, value added tax and trade discounts.
The materials returned/rejected are accounted for in the year of
return/rejection.
ii Income from services
Revenues from contracts priced on a time and material basis are
recognised when services are rendered and related costs are incurred.
iii Export incentives & other miscellaneous incomes are recognised on
accruel basis. Export benefits are accounted for in the year of exports
based on eligibility and when there is no uncertainty in receiving the
same.
iv Interest income is accounted on time proportion basis. Dividend
income is accounted for when the right to receive it is established.
F Fixed assets
Fixed assets are carried at cost less accumulated depreciation and
impairment losses, if any. The cost of fixed assets includes interest
on borrowings attributable to acquisition of qualifying fixed assets up
to the date the asset is ready for its intended use and other
incidental expenses incurred up to that date. Exchange differences
arising on restatement / settlement of long-term foreign currency
borrowings relating to acquisition of depreciable fixed assets are
adjusted to the cost of the respective assets and depreciated over the
remaining useful life of such assets. Machinery spares which can be
used only in connection with an item of fixed asset and whose use is
expected to be irregular are capitalised and depreciated over the
useful life of the principal item of the relevant assets. Subsequent
expenditure relating to fixed assets is capitalised only if such
expenditure results in an increase in the future benefits from such
asset beyond its previously assessed standard of performance.
Capital work-in-progress:
Capital work-in-progress comprises fixed assets that are not ready for
their intended use at the reporting date. Capital work in progress is
carries at direct cost, related incidental expenses and attributable
interest.
G Foreign currency transactions and translations
i Initial recognition
Transactions in foreign currencies entered into by the Company are
accounted for at the exchange rates prevailing on the date of the
transaction.
ii Measurement of foreign currency monetary items at the Balance Sheet
date Foreign currency monetary items (other than derivative contracts)
of the Company outstanding at the Balance Sheet date are restated at
the year-end rates.
iii Treatment of exchange differences
Exchange differences arising on settlement / restatement of short-term
foreign currency monetary assets and liabilities of the Company are
recognised as income or expense in the Statement of Profit and Loss.
The exchange differences arising on restatement / settlement of
long-term foreign currency monetary items are capitalised as part of
the depreciable fixed assets to which the monetary item relates and
depreciated over the remaining useful life of such assets.
iv Accounting of forward contracts
The Company uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use of
these foreign exchange forward and options contracts reduces the risk
or cost to the Company. The Company does not use those for trading or
speculation purposes. The resultant gain or loss from these
transactions is recognized in the statement of Profit and Loss.
H Employee benefits
Employee benefits include provident fund, gratuity fund, compensated
absences.
i Defined contribution plans
The Company''s contribution to provident fund and Employees State
Insurance Scheme are considered as defined contribution plans and are
charged as an expense as they fall due based on the amount of
contribution required to be made.
ii. Defined benefit plans
For defined benefit plans in the form of gratuity fund and compensated
absences, the cost of providing benefits is determined using the
Projected Unit Credit method, with actuarial valuations being carried
out at each Balance Sheet date. Actuarial gains and losses are
recognised in the Statement of Profit and Loss in the period in which
they occur. The retirement benefit obligation recognised in the Balance
Sheet represents the present value of the defined benefit obligation as
adjusted for unrecognised past service cost, as reduced by the fair
value of scheme assets. Any asset resulting from this calculation is
limited to past service cost, plus the present value of available
refunds and reductions in future contributions to the schemes.
iii Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees are recognised
during the year when the employees render the service. These benefits
include performance incentive and compensated absences which are
expected to occur within twelve months after the end of the period in
which the employee renders the related service. The cost of such
compensated absences is accounted as under :
(a) in case of accumulated compensated absences, when employees render
the services that increase their entitlement of future compensated
absences; and
(b) in case of non-accumulating compensated absences, when the absences
occur."
iv Long-term employee benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related service are recognised as a liability at the present value of
the defined benefit obligation as at the Balance Sheet date.
I Borrowing costs
Borrowing costs that are attributable to the acquisition of qualifying
assets are capitalised as part of cost of such assets until its ready
for its intended use. All other borrowing costs are charged to revenue
and recognised as an expense in the statement of profit and loss.
J Segment reporting
The activity of the company comprises of only manufacturing of
aluminium products hence there is no other reportable segment as
required by accounting standard- 17 on "Segment Reporting" issued by
the Institute of Chartered Accountants of India.
K Earnings per share
Basic earnings per share is computed by dividing the profit after tax
by the weighted average number of equity shares outstanding during the
year. Diluted earnings per share are computed using the weighted
average number of equity and dilutive equivalent shares outstanding
during the year.
L Taxes on income
Current tax is the amount of tax payable on the taxable income for the
year as determined in accordance with the provisions of the Income Tax
Act, 1961. Deferred tax resulting from Âtiming difference between
taxable and accounting income is accounted for using the tax rates and
laws that are enacted or substantively enacted as on the balance sheet
date. Deferred tax asset is recognised and carried forward only to the
extent that there is a virtual certainty that the asset will be
realised in future.
M Impairment of assets
In accordance with Accounting Standard (AS) 28 on ''Impairment of
Assets'' as notified by the Central Government under the Companies Act,
1956, the carrying amounts of the Company''s assets are reviewed at each
balance sheet date to determine whether there is any impairment. The
recoverable amount of the assets is estimated as the higher of its net
selling price and its value in use. An impairment loss is recognised
whenever the carrying amount of an asset or a cash-generating unit
exceeds its recoverable amount. Impairment loss is recognised in the
Statement of Profit and Loss or against revaluation surplus where
applicable.
N 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.
A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that may, but probably will
not, require an outflow of resources. When there is a possible
obligation or a present obligation in respect of which the likelyhood
of outflow of resources is remote, no provision or disclosure is made.
Mar 31, 2012
A Basis of Preperation of Financial Statements
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards notified under
the Companies (Accounting Standards) Rules, 2006 (as amended) and the
relevant provisions of the Companies Act, 1956, to the extent
applicable. The financial statements have been prepared on accrual
basis under the historical cost convention and the accounting policies
adopted in the preparation of the financial statements are consistent
with those followed in the previous year.
B 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 / materialise.
C Inventories
Items of Inventories are valued at the lower of cost (on FIFO basis)
and the net realisable value. Cost includes all direct costs and
applicable production overheads in bringing the goods to the present
location and condition.
D Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profit
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 amortisation
Depreciation has been provided on the straight-line method as per the
rates prescribed in Schedule XIV to the Companies Act, 1956
F Revenue recognition
i Sale of goods
Sales are recognised on transfer of significant risks and rewards of
ownership to the buyer, which generally coincides with the dispatch of
goods from the factory gate on the basis of excise invoice in the case
of domestic sales. Export sales are recognised on transfer of
significant risks and rewards of ownership to the buyer. Sales include
excise duty but exclude sales tax and value added tax.The materials
returned/rejected are accounted for in the year of return/rejection.
ii Income from services
Revenues from contracts priced on a time and material basis are
recognised when services are rendered and related costs are incurred.
iii Export incentives & other miscellaneous incomes are recognised on
accrual basis. Export benefits are accounted for in the year of exports
based on eligibility and when there is no uncertainty in receiving the
same.
iv Interest income is accounted on accrual basis. Dividend income is
accounted for when the right to receive it is established.
G Fixed assets
Fixed assets are carried at cost less accumulated depreciation and
impairment losses, if any. The cost of fixed assets includes interest
on borrowings attributable to acquisition of qualifying fixed assets up
to the date the asset is ready for its intended use and other
incidental expenses incurred up to that date. Exchange differences
arising on restatement / settlement of long-term foreign currency
borrowings relating to acquisition of depreciable fixed assets are
adjusted to the cost of the respective assets and depreciated over the
remaining useful life of such assets. Machinery spares which can be
used only in connection with an item of fixed asset and whose use is
expected to be irregular are capitalised and depreciated over the
useful life of the principal item of the relevant assets. Subsequent
expenditure relating to fixed assets is capitalised only if such
expenditure results in an increase in the future benefits from such
asset beyond its previously assessed standard of performance.
Capital work-in-progress: Capital work-in-progress comprises fixed
assets that are not ready for their intended use at the reporting date.
Capital work in progress is carries at direct cost, related incidental
expenses and attributable interest.
H Foreign currency transactions and translations
i Initial recognition
Transactions in foreign currencies entered into by the Company are
accounted for at the exchange rates prevailing on the date of the
transaction.
ii Measurement of foreign currency monetary items at the Balance Sheet
date
Foreign currency monetary items (other than derivative contracts) of
the Company outstanding at the Balance Sheet date are restated at the
year-end rates.
iii Treatment of exchange differences
Exchange differences arising on settlement / restatement of short-term
foreign currency monetary assets and liabilities of the Company are
recognised as income or expense in the Statement of Profit and Loss.The
exchange differences arising on restatement / settlement of long-term
foreign currency monetary items are capitalised as part of the
depreciable fixed assets to which the monetary item relates and
depreciated over the remaining useful life of such assets.
iv Accounting of forward contracts
The Company uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use of
these foreign exchange forward and options contracts reduces the risk
or cost to the Company. The Company does not use those for trading or
speculation purposes. The resultant gain or loss from these
transactions is recognized in the Profit and Loss account.
I Employee benefits
Employee benefits include provident fund, gratuity fund, compensated
absences.
i Defined contribution plans
The Company's contribution to provident fund and Employees State
Insurance Scheme are considered as defined contribution plans and are
charged as an expense as they fall due based on the amount of
contribution required to be made.
ii Defined benefit plans
For defined benefit plans in the form of gratuity fund and compensated
absences, the cost of providing benefits is determined using the
Projected Unit Credit method, with actuarial valuations being carried
out at each Balance Sheet date. Actuarial gains and losses are
recognised in the Statement of Profit and Loss in the period in which
they occur. The retirement benefit obligation recognised in the Balance
Sheet represents the present value of the defined benefit obligation as
adjusted for unrecognised past service cost, as reduced by the fair
value of scheme assets. Any asset resulting from this calculation is
limited to past service cost, plus the present value of available
refunds and reductions in future contributions to the schemes.
iii Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees are recognised
during the year when the employees render the service. These benefits
include performance incentive and compensated absences which are
expected to occur within twelve months after the end of the period in
which the employee renders the related service. The cost of such
compensated absences is accounted as under :
(a) in case of accumulated compensated absences, when employees render
the services that increase their entitlement of future compensated
absences; and
(b) in case of non-accumulating compensated absences, when the absences
occur.
iv Long-term employee benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related service are recognised as a liability at the present value of
the defined benefit obligation as at the Balance Sheet date.
J Borrowing costs
Borrowing costs that are attributable to the acquisition of qualifying
assets are capitalised as part of cost of such assets until its ready
for its intended use. All other borrowing costs are charged to revenue
and recognised as an expense in the statement of profit and loss
account.
K Segment reporting
The activity of the company comprises of only manufacturing of
aluminium products hence there is no other reportable segment as
required by Accounting Standard-17 on "Segment Reporting" issued by
the Institute of Chartered Accountants of India.
L Earnings per share
Basic earnings per share is computed by dividing the profit after tax
by the weighted average number of equity shares outstanding during the
year. Diluted earnings per share are computed using the weighted
average number of equity and dilutive equivalent shares outstanding
during the year, except where the results would be anti dilutive.
M Taxes on income
Current tax is the amount of tax payable on the taxable income for the
year as determined in accordance with the provisions of the Income Tax
Act, 1961.Deferred tax resulting from "timing difference" between
taxable and accounting income is accounted for using the tax rates and
laws that are enacted or substantively enacted as on the balance sheet
date. Deferred tax asset is recognised and carried forward only to the
extent that there is a virtual certainty that the asset will be
realised in future.
N Impairment of assets
In accordance with Accounting Standard (AS) 28 on 'Impairment of
Assets' as notified by the Central Government under the Companies
Act, 1956, the carrying amounts of the Company's assets are reviewed
at each balance sheet date to determine whether there is any
impairment. The recoverable amount of the assets is estimated as the
higher of its net selling price and its value in use. An impairment
loss is recognised whenever the carrying amount of an asset or a
cash-generating unit exceeds its recoverable amount. Impairment loss is
recognised in the Statement of Profit and Loss or against revaluation
surplus where applicable.
O 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. A disclosure for a
contingent liability is made when there is a possible obligation or a
present obligation that may, but probably will not, require an outflow
of resources. When there is a possible obligation or a present
obligation in respect of which the likelyhood of outflow of resources
is remote, no provision or disclosure is made.
Mar 31, 2010
1. Method of Accounting
The financial statements have been prepared under the historical cost
convention in accordance with the generally accepted accounting
principles and the provisions of the Companies Act, 1956 as adopted
consistently by the Company. All income & expenditure items having a
material bearing on the financial statements are recognized on accrual
basis, except in respect of insurance claims, liquidated damages, where
the exact quantum cannot be ascertained.
2. Revenue Recognition
a. Revenue from sale of own manufactured goods and trading goods is
recognized on dispatch of goods from the factory gate on the basis of
excise invoice or at the time of transfer of signifcant risks and
reward of ownership to the buyer. The sales are inclusive of excise
duty but net of value added tax. Further, the materials
returned/rejected are accounted for in the year of return//rejection.
b. For services rendered, the Company recognizes revenue on the basis
of Completed Contract Method.
c. Export incentives & other miscellaneous incomes are recognized on
accrual basis except dividend on investments, which are accounted in
the year of receipt
d. Interest income is recognized on a time proportion basis taking
into account the amount outstanding and the rate applicable.
3. Inventories are valued as under :-
a) Raw materials components, stores and spares: Lower of cost or net
realizable value. Cost is computed using frst in frst out method.
b) Stock in process- at cost
Stock in process includes the cost of purchase, appropriate share of
cost of conversion and other overhead incurred in bringing the
inventories to its present location and condition.
c) Finished goods: Lower of cost or net realizable value.
Cost of fnished goods includes cost of purchase, cost of conversion and
other overhead incurred in bringing the inventory to its present
location and condition.
d) Inventories have been valued in accordance with accounting standard
on valuation of inventories (AS-2) issued by the Institute of Chartered
Accountants of India.
e) Inventory valued on above basis is certifed by the management.
4. Investments:
The company did not have any investment as at 31st March,2010.
5. Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation. Capital
work-in-progress comprises outstanding advances paid to acquire fxed
assets, and the cost of fxed assets that are not yet ready for their
intended use at the reporting date. Further, in case of impairment of
assets, the fxed Assets are carried at cost or recoverable amount
whichever is less.
6. Depreciation:
Depreciation on fxed assets has been provided on straight-line method
at rates and in the manner specifed in schedule XIV of the Companies
Act. 1956.
7. Foreign Currency Transactions
Foreign currency denominated monetary assets and liabilities are
translated into the relevant functional currency at exchange rates in
efect at the Balance Sheet date. The gains or losses resulting from
such translations are included in the Proft and Loss account.
Revenue, expense and cash-fow items denominated in foreign currencies
are translated into the relevant functional currencies using the
exchange rate in efect on the date of the transaction. Transaction
gains or losses realized upon settlement of foreign currency
transactions are included in determining net proft for the period in
which the transaction is settled.
8. Forward contracts and options in foreign currencies
The Company uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use of
these foreign exchange forward and options contracts reduces the risk
or cost to the Company. The Company does not use those for trading or
speculation purposes. The resultant gain or loss from these
transactions is recognized in the Proft and Loss account
9. Impairment of assets
As required by Accounting Standard (AS) 28 Impairment of AssetsÃ
notifed by the institute of Chartered Accountant of India, the Company
has carried out the assessment of impairment of assets. There has been
no impairment loss during the year.
10. Borrowing Cost
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the costs
of such assets. All other borrowing costs are charged to Proft and Loss
Account in the period in which they are incurred.
11. Provisions:
Provisions are recognized when the Company has a present obligation as
a result of past events, for which it is probable that an outfow of
resources embodying economic benefts will be required to settle the
obligation, and a reliable estimate of the amount can be made.
Provisions required to settle are reviewed regularly and are adjusted
where necessary to refect the current best estimate of the obligation.
Where the Company expects provisions to be reimbursed, is recognized as
a separate asset, only when such reimbursement is virtually certain.
12. Taxation
Tax on income for the current period is determined on the basis of
estimated taxable income and tax credits computed in accordance with
the provisions of the Income Tax Act, 1961.
Deferred tax is recognized on timing diferences between the accounting
income and the taxable income for the year as on the Balance Sheet
date.
13. Miscellaneous Expenditure
Brought forward Preliminary Expenditure of Rs.3, 96,514/- has been
written of during the year to comply with the Accounting Standards 26
issued by the Institute of Chartered Accountants of India.
14. Contingent liabilities:
Contingent Liabilities are not provided for in the accounts but are
separately disclosed by way of a note.
15. Segment Reporting
The activities of the company consist of manufacture and sale of
Aluminum products. Hence there is no separate reportable segment for
which fgures could be reported as required by Accounting Standard -17
on ÃSegment Reportingà issued by The Institute of Chartered Accountants
of India.
16. Employees Benefts:
(i) Defned Contribution Plan
The Company makes defned contribution to Provident Fund and Employee
State Insurance Scheme, which are recognized in the Proft and Loss
Account on accrual basis.
(ii) Defned Beneft Plan
The Company operates a defned gratuity plan for all employees with Life
Insurance Corporation of India. The CompanyÃs contribution of premium
to gratuity scheme is recognized in the proft & Loss Account in the
financial year to which it relates.
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