Home  »  Company  »  Magna Industries  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Magna Industries Exports Ltd. Company

Mar 31, 2014

1. ACCOUNTING ASSUMPTIONS:

The financial statements are drawn up in accordance with the historical cost convention on accrual basis and comply with the accounting standards referred to in Sec 211 (3C) of the Companies Act, 1956.

2. FIXED ASSETS:

All fixed assets are stated at cost of acquisition less accumulated depreciation and impairment loss, if any.

3. DEPRECIATION:

Depreciation on all fixed assets is provided on straight-line method at the rate specified in Schedule XIV of the Companies Act, 1956. Depreciation on additions / deletions is provided on pro-rata basis to the months of additions / deletions.

4. INVESTMENTS:

Investments are classified as long-term investments and are stated at cost. Diminution in value, if any, which is of a temporary nature, is not provided.

5. VALUATION OF INVENTORIES:

Finished Goods are valued at cost.

6. REVENUE RECOGNITION:

Sales are recognized, on involving and actual dispatch to customers and are recorded exclusive of Sales Tax. Other incomes, interest incomes are accounted on accrual basis.

7. FOREIGN CURRENCY TRANSACTION:

The transactions in foreign currency are accounted at exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currency outstanding at the year-end are translated at the year- end exchange rate and the unrealized exchange gain or loss is recognized in the profit and loss account.

8. BORROWING COSTS:

Borrowing costs are recognized as an expense in the period in which they are incurred, except to the extent where borrowing costs that are directly attributable to the acquisition, construction, or production of an asset till put for its intended use is capitalized as part of the cost of that asset.

9. A) CURRENT TAX:

Provisions for Current Income tax liability is made on estimated Taxable Income under Income Tax Act, 1961 after considering permissible tax exemptions, deductions and disallowances. This liability is calculated at the applicable tax rate or Minimum Alternate Tax rate under section 115JB of The Income Tax, 1961 as the case maybe.

B) DEFERRED TAX:

Deferred Tax liability ascertained as on 31st March 2002 resulting from timing differences between book profits and tax profits is accounted for under the liability method, at the tax rate specified under section 115JB of the Income Tax Act, 1961 to the extent that the timing differences are expected to crystallize. Deferred tax liability on timing difference arising subsequent to 31st March, 2002 is accounted at regular rate as enacted in the Income Tax Act, 1961.

10. PROVISION AND CONTINGENT LIABILITIES:

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can b 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, requires an outflow of resources. When there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

11. PROPOSED DIVIDEND:

Dividend proposed by the Board of Directors is provided in the books of account, pending approval of the shareholders in Annual General Meeting.

12. MEASUREMENT OF EBIDTA:

As per the guidance note on revised schedule VI of the Companies Act, 1956, issued by the ICAI, the company has elected to present earnings before interest, tax, depreciation & amortization (EBIDTA) as a separate line item on the face of the statement of profit and loss. The company measures EBIDTA on the basis of profit / (loss) from continuing operations. In its measurements, the company does not include finance costs, depreciation and amortization expense and tax expense.

14. Previous year''s figures have been regrouped/reclassified wherever Necessary to Correspond with the current year''s classifications/disclosure.

Signatures to Significant Accounting Policies and Noted 1 to 18 to the financial statements.


Mar 31, 2013

1. ACCOUNTING ASSUMPTIONS:

The financial statements are drawn up in accordance with the historical cost convention on accrual basis and comply with the accounting standards referred to in Sec 211 (3C) of the Companies Act, 1956.

2. FIXED ASSETS:

All fixed assets are stated at cost of acquisition less accumulated depreciation and impairment loss, if any.

3. DEPRECIATION:

Depreciation on all fixed assets is provided on straight-line method at the rate specified in Schedule XIV of the Companies Act, 1956. Depreciation on additions / deletions is provided on pro-rata basis to the months of additions / deletions.

4. INVESTMENTS:

Investments are classified as long-term investments and are stated at cost. Diminution in value, if any, which is of a temporary nature, is not provided.

5. VALUATION OF INVENTORIES:

Finished Goods are valued at cost.

6. REVENUE RECOGNITION:

Sales are recognized, on involving and actual dispatch to customers and are recorded exclusive of Sales Sax. Other incomes, interest incomes are accounted on accrual basis.

7. FOREIGN CURRENCY TRANSACTION:

The transactions in foreign currency are accounted at exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currency outstanding at the year-end are translated at the year- end exchange rate and the unrealized exchange gain or loss is recognized in the profit and loss account.

8. BORROWING COSTS:

Borrowing costs are recognized as an expense in the period in which they are incurred, except to the extent where borrowing costs that are directly attributable to the acquisition, construction, or production of an asset till put for its intended use is capitalized as part of the cost of that asset.

9. A) CURRENT TAX:

Provisions for Current Income tax liability is made on estimated Taxable Income under Income Tax Act, 1961 after considering permissible tax exemptions, deductions and disallowances. This liability is calculated at the applicable tax rate or Minimum Alternate Tax rate under section 115JB of The Income Tax, 1961 as the case maybe.

B) DEFERRED TAX:

Deferred tax reflects the impact of current year timing differences between accounting and taxable income and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized and are reviewed at each balance sheet date.

10. PROVISION AND CONTINGENT LIABILITIES:

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can b 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, requires an outflow of resources. When there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

11. PROPOSED DIVIDEND:

Dividend proposed by the Board of Directors is provided in the books of account, pending approval of the shareholders in Annual General Meeting.

12. MEASUREMENT OF EBIDTA:

As per the guidance note on revised schedule VI of the Companies Act, 1956, issued by the ICAI, the company has elected to present earnings

 
Subscribe now to get personal finance updates in your inbox!