Home  »  Company
Enter the first few characters of Company and click 'Go'
Sorry, unable to find the company details of Maharaja shree umaid mills

Search NSE/BSE Listed Company Details By Alphabets

 
Subscribe now to get personal finance updates in your inbox!
Maharaja Shree Umaid Mills Ltd. Accounting Policies | Accounting Policy of Maharaja Shree Umaid Mills Ltd.
Home  »  Company  »  Maharaja Shree U  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Maharaja Shree Umaid Mills Ltd. Company

Mar 31, 2015

A Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, except for certain fixed assets which are revalued, in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 2013.The Company has prepared these financial statements as per the format prescribed by Schedule III to the Companies Act, 2013.

B. Recognition of Income & Expenditure

Revenues/Incomes and Costs/Expenditures are generally accounted for on accrual basis, as these are earned or incurred. Cenvat as availed of is taken into account. Any subsidy viz, interest subsidy, Rebates under any government schemes is recognized & accounted for as & when received. Dividend income is recognized when right to receive is established.

C. Fixed Assets

Fixed Assets (except Land which is carried at revalued figure) are stated at cost (Net of CENVAT) of acquisition or construction less accumulated depreciation. Cost of acquisition is inclusive of freight, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

D. Intangible Assets

Intangible assets are stated at cost less accumulated amount of amortization.

E. Depreciation

Depreciation for the year has been provided for as per the Schedule II to the Companies Act, 2013 based on the remaining useful lives of the assets as under-

a) on Plant & Machinery and Electric Installation added upto 31.12.1979 - on written down value method and on additions from 01.01.1980 onwards - on straight line method.

b) on all other items of Fixed Assets - on written down value method. No Depreciation is charged on freehold land.

c) Cost of leasehold land is amortized over the period of lease.

F. Investments

Investments are classified as Current and Long Term. Investments which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. Current Investments are carried at lower of cost or fair value. Long Term investments are stated at cost, provision for diminution in the value is made to recognize a decline other than temporary in the value of such investments.

G Inventories

Finished Goods are valued at cost or Net realizable value whichever is lower; Stock in Process is valued at cost depending upon the stage of completion; Raw Materials and Stores & Spare Parts and Fuel are valued at cost; and scrap materials are valued at net realizable value. The cost is determined using specific identification cost method for Raw Materials and weighted average cost method for Stores & Spare Parts and Fuel.

H. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee's State Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund trust equal to specified percentage of the covered employees' salary. The Company recognised Rs.310.08 Lacs (previous year Rs. 285.67 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award. The Company contributes to the Gratuity Fund, which is recognised by the Income Tax Authorities and administered thorough its trustees. The liability for Gratuity and Leave Encashment is determined on the basis of an independent actuarial valuation done at the year- end. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method

I. Foreign Currency Transactions

a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction or that approximates the actual rate at the date of transaction.

b) Monetary items denominated in foreign currencies at the year-end are re-stated at the year-end rates. In case of items which are covered by forward exchange contracts, the difference between the year- end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c) Non-monetary items denominated in foreign currencies are carried at cost.

d) Any income or expense on account of exchange difference is recognized in the Statement of Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case, they are adjusted to the carrying cost of such assets

J. Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. A Qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. The basis of working out the borrowing costs is weighted average rate applicable to the borrowing of the Company that are outstanding during the period except where specific identification exists. All other borrowing costs are recognized as expenses in the period in which they are incurred.

K. Taxes on Income

Provision for current tax is made in accordance with the provisions of the Income-tax Act, 1961, and after taking into consideration, benefits admissible therein. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period. In the year in which MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in the Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement as a separate line item. The Company reviews the same at each Balance Sheet date and write down the carrying amount of MAT Credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal tax during the specified period.

L Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. The carrying value of asset is reviewed at each balance sheet date to determine if there is indication of any impairment. If any indication exists, the asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount, and is recognized in the Profit & Loss Account. An impairment loss is reversed if there has been a change in the estimate of recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

M. Provisions, Contingent Liabilities and Contingent Assets

A provision is made when there is a present obligation as a result of past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. Provision is made for outstanding dues of customers which are doubtful of recovery. Assessment of such doubtful debts is made on case to case basis by the management.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation, which may, but probably will not, require an outflow of resources. When there is a possible or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. The Company does not recognize assets which are of contingent nature until there is virtual certainty of realisability of such assets. However, if it has become virtually certain that an inflow of economic benefits will arise, asset and related income is recognized in the financial statements of the period in which the change occurs.


Mar 31, 2014

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, except for certain fixed assets which are revalued, in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 1956.The Company has prepared these financial statements as per the format prescribed by Revised Schedule VI to the Companies Act, 1956 issued by Ministry of Corporate Affairs. Previous year figures have been recast/ restated to conform to the classification required by the Revised Schedule VI.

B. Recognition of Income & Expenditure

Revenues/Incomes and Costs/Expenditures are generally accounted for on accrual basis, as these are earned or incurred. Cenvat as availed of is taken into account. Any subsidy viz, interest subsidy, Rebates under any government schemes is recognized & accounted for as & when received. Dividend income is recognized when right to receive is established.

Consequent to implementation SAP ERP system during the current Financial year, Interplant transfers between Yarn & fabric Plants are made & accounted for in books of accounts by receiving plants based on transfer price . At the end of the Quarter & Financial year, unconsumed stock arising out of such interplant transfers are arrived at & any profit or loss attributable to such unconsumed stock is suitably adjusted

C. Fixed Assets

Fixed Assets (except Land which is carried at revalued figure) are stated at cost (Net of CENVAT) of acquisition or construction less accumulated depreciation. Cost of acquisition is inclusive of freight, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

D. Intangible Assets

Intangible assets are stated at cost less accumulated amount of amortisation .

E. Depreciation

Depreciation has been provided for at the rates in force from time to time as per the Schedule XIV of the Companies Act, 1956 as under- a) on Plant & Machinery and Electric Installation added upto 31.12.1979 - on written down value method and on additions from 01.01.1980 onwards - on straight line method.

b) on all other items of Fixed Assets - on written down value method. No Depreciation is charged on freehold land.

c) Cost of leasehold land is amortized over the period of lease.

F. Investments

Investments are classified as Current and Long Term. Investments which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. Current Investments are carried at lower of cost or fair value. Long

Term investments are stated at cost, provision for diminution in the value is made to recognize a decline other than temporary in the value of such investments.

G. Inventories

Raw Materials and Finished Goods are valued at cost or Net realizable value whichever is lower; Stock in Process is valued at cost depending upon the stage of completion ; Stores & Spare Parts and Fuel are valued at cost ; and scrap materials are valued at net realizable value. The cost is determined using specific identification cost method for Raw Materials and weighted average cost method for Stores & Spare Parts and Fuel.

H. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee''s State Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund trust equal to specified percentage of the covered employees'' salary. The Company recognised Rs.310.08 Lacs (previous year Rs. 285.67 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award. The Company contributes to the Gratuity Fund, which is recognised by the Income Tax Authorities and administered thorough its trustees. The liability for Gratuity and Leave Encashment is determined on the basis of an independent actuarial valuation done at the year- end. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method

I. Foreign Currency Transactions

a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction or that approximates the actual rate at the date of transaction.

b) Monetary items denominated in foreign currencies at the year-end are re-stated at the year-end rates. In case of items which are covered by forward exchange contracts, the difference between the year- end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c) Non-monetary items denominated in foreign currencies are carried at cost.

d) Any income or expense on account of exchange difference is recognized in the Statement of Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case, they are adjusted to the carrying cost of such assets

J. Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. A Qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. The basis of working out the borrowing costs is weighted average rate applicable to the borrowing of the Company that are outstanding during the period except where specific identification exists. All other borrowing costs are recognized as expenses in the period in which they are incurred.

K. Taxes on Income

Provision for current tax is made in accordance with the provisions of the Income-tax Act, 1961, and after taking into consideration, benefits admissible therein. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period. In the year in which MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in the Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement as a separate line item. The Company reviews the same at each Balance Sheet date and write down the carrying amount of MAT Credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal tax during the specified period.

L. Impairment of Assets

As asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. The carrying value of asset is reviewed at each balance sheet date to determine if there is indication of any impairment. If any indication exists, the asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount, and is recognized in the Profit & Loss Account. An impairment loss is reversed if there has been a change in the estimate of recoverable amount. An impairment loss is reversed only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

M. Provisions, Contingent Liabilities and Contingent Assets

A provision is made when there is a present obligation as a result of 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 or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. The Company does not recognize assets which are of contingent nature until there is virtual certainty of realisability of such assets. However, if it has become virtually certain that an inflow of economic benefits will arise, asset and related income is recognized in the financial statements of the period in which the change occurs.


Mar 31, 2013

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, except for certain fixed assets which are revalued, in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 1956.The Company has prepared these financial statements as per the format prescribed by Revised Schedule VI to the Companies Act, 1956 issued by Ministry of Corporate Affairs. Previous year figures have been recast/ restated to conform to the classification required by the Revised Schedule VI.

B. Recognition of Income & Expenditure

Revenues/Incomes and Costs/Expenditures are generally accounted for on accrual basis, as these are earned or incurred. Cenvat as availed of is taken into account. Any subsidy, DEPB, Duty Drawback and Rebate etc. under any Government schemes is recognized and accounted for as and when received. Dividend income is recognized when right to receive is established.

C. Fixed Assets

Fixed Assets (except Land which is carried at revalued figure) are stated at cost (Net of CENVAT) of acquisition or construction less accumulated depreciation. Cost of acquisition is inclusive of freight, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

0. Depreciation

Depreciation has been provided for at the rates in force from time to time as per the Schedule XIV of the Companies Act, 1956 as under-

a) on Plant & Machinery and Electric Installation added upto 31.12.1979 - on written down value method and on additions from 01.01.1980 onwards - on straight line method.

b) on all other items of Fixed Assets - on written down value method. No Depreciation is charged on freehold land.

c) Cost of leasehold land is amortized over the period of lease.

E. Investments

Investments are classified as Current and Long Term. Investments which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. Current Investments are carried at lower of cost or fair value. Long Term investments are stated at cost, provision for diminution in the value is made to recognize a decline other than temporary in the value of such investments.

F. Inventories

Raw Materials and Finished Goods are valued at cost or Net realizable value whichever is lower; Stock in Process is valued at cost depending upon the stage of completion ; Stores & Spare Parts and Fuel are valued at cost; and scrap materials are valued at net realizable value. The cost is determined using specific identification cost method for Raw Materials and weighted average cost method for Stores & Spare Parts and Fuel.

G. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee''s State Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund trust equal to specified percentage of the covered employees'' salary. The Company recognised Rs.310.08 Lacs (previous year Rs. 285.67 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award. The Company contributes to the Gratuity Fund, which is recognised by the Income Tax Authorities and administered thorough its trustees. The liability for Gratuity and Leave Encashment is determined on the basis of an independent actuarial valuation done at the year-end. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method

H. Foreign Currency Transactions

a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction or that approximates the actual rate at the date of transaction.

b) Monetary items denominated in foreign currencies at the year-end are re-stated at the year-end rates. In case of items which are covered by forward exchange contracts, the difference between the year- end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c) Non-monetary items denominated in foreign currencies are carried at cost.

d) Any income or expense on account of exchange difference is recognized in the Statement of Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case, they are adjusted to the carrying cost of such assets

I. Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. A Qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. The basis of working out the borrowing costs is weighted average rate applicable to the borrowing of the Company that are outstanding during the period except where specific identification exists. All other borrowing costs are recognized as expenses in the period in which they are incurred.

J. Taxes on income

Provision for current tax is made in accordance with the provisions of the Income-tax Act, 1961, and after taking into consideration, benefits admissible therein. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period. In the year in

which MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in the Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement as a separate line item. The Company reviews the same at each Balance Sheet date and write down the carrying amount of MAT Credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal tax during the specified period.

K. Impairment of Assets

As asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. The carrying value of asset is reviewed at each balance sheet date to determine if there is indication of any impairment. If any indication exists, the asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount, and is recognized in the Profit & Loss Account. An impairment loss is reversed if there has been a change in the estimate of recoverable amount. An impairment loss is reversed only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

L Provisions, Contingent Liabilities and Contingent Assets

A provision is made when there is a present obligation as a result of 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 or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. The Company does not recognize assets which are of contingent nature until there is virtual certainty of realisability of such assets. However, if it has become virtually certain that an inflow of economic benefits will arise, asset and related income is recognized in the financial statements of the period in which the change occurs.


Mar 31, 2012

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, except for certain fixed assets which are revalued, in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 1956.The Company has prepared these financial statements as per the format prescribed by Revised Schedule VI to the Companies Act, 1956 issued by Ministry of Corporate Affairs. Previous year figures have been recast/ restated to conform to the classification required by the Revised Schedule VI.

B. Recognition of Income & Expenditure

Revenues/Incomes and Costs/Expenditures are generally accounted for on accrual basis, as these are earned or incurred. Cenvat as availed of is taken into account. Any subsidy, DEPB, Duty Drawback and Rebate etc. under any Government schemes is recognized and accounted for as and when received. Dividend income is recognized when right to receive is established.

C. Fixed Assets

Fixed Assets (except Land which is carried at revalued figure) are stated at cost (Net of CENVAT) of acquisition or construction less accumulated depreciation. Cost of acquisition is inclusive of freight, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

D. Depreciation

Depreciation has been provided for at the rates in force from time to time as per the Schedule XIV of the Companies Act, 1956 as under-

a) on Plant & Machinery and Electric Installation added upto 31.12.1979 - on written down value method and on additions from 01.01.1980 onwards - on straight line method.

b) on all other items of Fixed Assets - on written down value method. No Depreciation is charged on freehold land.

c) Cost of leasehold land is amortized over the period of lease.

E. Investments

Investments are classified as Current and Long Term. Investments which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. Current Investments are carried at lower of cost or fair value. Long Term investments are stated at cost, provision for diminution in the value is made to recognize a decline other than temporary in the value of such investments.

F. Inventories

Raw Materials and Finished Goods are valued at cost or net realizable value whichever is lower; Stock in Process is valued at cost depending upon the stage of completion ; Stores & Spare Parts and Fuel are valued at cost ; and scrap materials are valued at net realizable value. The cost is determined using specific identification cost method for Raw Materials and weighted average cost method for Stores & Spare Parts and Fuel.

G. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee's State Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund trust equal to specified percentage of the covered employees' salary. The Company recognised Rs.285.67 Lacs (previous year Rs. 264.06 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award. The Company contributes to the Gratuity Fund, which is recognised by the Income Tax Authorities and administered thorough its trustees. The liability for Gratuity and Leave Encashment is determined on the basis of an independent actuarial valuation done at the year-end. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method

H. Foreign Currency Transactions

a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction or that approximates the actual rate at the date of transaction.

b) Monetary items denominated in foreign currencies at the year-end are re-stated at the year-end rates. In case of items which are covered by forward exchange contracts, the difference between the year- end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c) Non-monetary items denominated in foreign currencies are carried at cost.

d) Any income or expense on account of exchange difference is recognized in the Statement of Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case, they are adjusted to the carrying cost of such assets

I. Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. A Qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. The basis of working out the borrowing costs is weighted average rate applicable to the borrowing of the Company that are outstanding during the period except where specific identification exists. All other borrowing costs are recognized as expenses in the period in which they are incurred.

J. Taxes on Income

Provision for current tax is made in accordance with the provisions of the Income-tax Act, 1961, and after taking into consideration, benefits admissible therein. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period. In the year in which MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in the Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement as a separate line item. The Company reviews the same at each Balance Sheet date and write down the carrying amount of MAT Credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal tax during the specified period.

K. Impairment of Assets

As asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. The carrying value of asset is reviewed at each balance sheet date to determine if there is indication of any impairment. If any indication exists, the asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount, and is recognized in the Profit & Loss Account. An impairment loss is reversed if there has been a change in the estimate of recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

L. Provisions, Contingent Liabilities and Contingent Assets

A provision is made when there is a present obligation as a result of 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 or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. The Company does not recognize assets which are of contingent nature until there is virtual certainty of realisability of such assets. However, if it has become virtually certain that an inflow of economic benefits will arise, asset and related income is recognized in the financial statements of the period in which the change occurs.


Mar 31, 2011

A. Recognition of Income & Expenditure

Revenues/Incomes and costs/expenditures are generally Accounted for on accrual basis, as these are earned or incurred. Cenva as availed of is taken ino Account. Any subsidy, DEPB, Duy Drawback and Rebae ec. under any Government schemes including TUFS is recognized and Accounted for as and when received.

B. Fixed Assets

Fixed assest (except for Land which is a revalued figure) are stated a cost (Ne of CENVAT) of acquisiion or consrucion less accumulaed depreciation. cost of acquisiion is inclusive of freigh, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

C. Depreciation

Depreciation has been provided for at the rates in force from time to time as per the Schedule XIV of the Companies Act, 1956 as undert

(i) on Plant & Machinery and Electric Installation added upto 31.12.1979 t on written down value method and on addiions from 01.01.1980 onwards t on sraigh line mehod.

(ii) on all other items of Fixed Assets t on written down value method. No Depreciation is charged on land.

D. Investments

Investments are classified as current and Long term. The current Investments are stated a lower of the costs or fair value. Long term Investments are stated a cost. Suiable provisions are made / reserves created to recognize a nonttemporary decline in the value of such investments.

E. Inventories

Raw materials and Finished Goods are valued a cost or Ne realizable value whichever is lower; Sock in Process is valued a cost depending upon the sage of compleion ; Sores & Spare Pars and Fuel are valued a cost; and scrap materials are valued a ne realizable value. The cost is determined using specific idenification cost mehod for Raw materials and weighted average cost mehod for Sores & Spare Parts and Fuel.

F. Gratuity and Leave encashment

Liabiliies for the grauiy and leave encashment are evaluaed a the year end by Acuary and the incremental amount of these liabilities is charged to the Income statement for the period.

G. Foreign Currency Transactions

Transacions denominaed in foreign currencies are recorded a the exchange rate prevailing on the date of ransacion or that approximaes the acual rate a the date of ransacion. export sales are recorded at the custom notified exchange rates.

Moneary items denominaed in foreign currencies a the year end, are retstated a the year end raes or forward exchange contract rates, as the case may be.

Nontmonetary items denominated in foreign currencies are carried at cost.

No ransacion ook place during the yearwherein the exchange rate difference arose for the acquisiion of fixed assets.

H. Borrowing costs

Borrowing costs that are aribuable to the acquisiion, consrucion or producion of qualifying assest are capitalized as part of the cost of such assets. Qualifying asset is one that necessarily takes a subsanial period of time to get ready for is inended use. The basis of working out the borrowing costs is weighed average rate applicable to the borrowing of the Company that are outsanding during the period except wthere specific idenification exiss. All other borrowing costs are recognized as expenses in the period in which they are incurred.

I. Taxes on Income

Provision for current ax is made in accordance with the provisions of the Incometax Act, 1961, and afer aking ino consideration, benefits admissible therein. Deferred ax resuling from "iming differencet between axable and Accounting income is Accounted for using the ax raes and laws that are enaced or subsanially enaced as on the balance Sheet date. The deferred ax asse is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

Minimum alernate Tax (MAT) credi is recognized as an asse only when and o the exen here is convincing evidence that the company will pay normal ax during the specified period. In the year in which MAT credi becomeseligible to be recognized as an asse in accordance with the recommendations conained in the Guidance Noe issued by the Insiue of Charered Accountans of India, the said asset is created by way of a credi o the profit and Loss Account and shown as MAT Credi enilemen as a separae line iem. The Company reviews the same a each Balance Sheet date and wrie down the carrying amount of MAT Credi enilemen to the exen there is no longer convincing evidence to the effect t hat the company will pay normal tax during the specified period.

J. Impairment of Assets

As asse is treated as impaired when the carrying cost of asse exceeds is recoverable value. The carrying value of asse is reviewed a each balance Sheet date to determine if here is indication of any impairment. If any indication exiss, the asse's recoverable amount is esimaed. An impairment loss is recognized whenever the carrying amount of an asse or is cash generaing uni exceeds is recoverable amount, and is recognized in the profit & Loss Account. An impairment loss is reversed if here has been a change in the esimae of recoverable amount. An impairment loss is reversed only to the exen hat the asse's carrying amount does no exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

K. Provisions, Contingent Liabilities and Contingent Assets

A provision is made when here is a present obligation as a result of pas even that probably requires an outflow of resources and a reliable esimate can be made of the amount of the obligation. A disclosure for a coningent liability is made when here is a possible obligation or a present obligation, that may, but probably will no, require an outflow of resources. When there is a possible or a present obligation in respect of which the likelihood of outflow of resources is remove, no provision or disclosure is made. The Company does no recognize assest which are of contingent nature unil there is virual cerainy of readability of such assest. However, if i has become virually cerain that an inflow of economic benefits will arise, asse and related income is recognized in the financial statements of the period in which the change occurs.


Mar 31, 2010

A. Recognition of Income & Expenditure

Revenues/Incomes and Costs/Expenditures are generally accounted for on accrual basis, as these are earned or incurred. Cenvat as availed of is taken into account. Any subsidy, DEPB, Duty Drawback and Rebate etc. under any Government schemes including TUFS is recognized and accounted for as and when received.

B. Fixed Assets

Fixed Assets (except for Land which is at revalued figure) are stated at cost (Net of CENVAT) of acquisition or construction less accumulated depreciation. Cost of acquisition is inclusive of freight, duties, taxes and other incidental expenses up to the date of installation/commissioning of assets.

C. Depreciation

Depreciation has been provided for at the rates in force from time to time as per the Schedule XIV of the Companies Act, 1956 as under-

(i) on Plant & Machinery and Electric Installation added upto 31.12.1979 - on written down value method and on additions from 01.01.1980 onwards - on straight line method.

(ii) on all other items of Fixed Assets - on written down value method. No Depreciation is charged on land.

D. Investments

Investments are classified as Current and Long Term. The current investments are stated at lower of the costs or fair value. Long Term investments are stated at cost. Suitable provisions are made / reserves created to recognize a non-temporary decline in the value of such investments.

E. Inventories

Raw Materials and Finished Goods are valued at cost or Net realizable value whichever is iower; Stock in Process is valued at cost depending upon the stage of completion ; Stores & Spare Parts and Fuel are valued at cost; and scrap materials are valued at net realizable value. The cost is determined using specific identification cost method for Raw Materials and weighted average cost method for Stores & Spare Parts and Fuel.

F. Gratuity and Leave encashment

Liabilities for the gratuity and leave encashment are evaluated at the year end by Actuary and the incremental amount of these liabilities is charged to the Income statement for the period.

G. Foreign Currency Transactions

Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction or that approximates the actual rate at the date of transaction. Export sales are recorded at the custom notified exchange rates.

Monetary items denominated in foreign currencies at the year end, are re-stated at the year end rates or forward exchange contract rates, as the case may be.

Non-monetary items denominated in foreign currencies are carried at cost.

No transaction took place during the year wherein the exchange rate difference arose for the acquisition of fixed assets.

H. Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of such assets. Qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. The basis of working out the borrowing costs is weighted average rate applicable to the borrowing of the Company that are outstanding during the period except where specific identification exists. All other borrowing costs are recognized as expenses in the period in which they are incurred.

I. Taxes on Income

Provision for current tax is made in accordance with the provisions of the Income-tax Act, 1961, and after taking into consideration, benefits admissible therein. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future.

J. Impairment of Assets

As asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. The carrying value of asset is reviewed at each balance sheet date to determine if there is indication of any impairment. If any indication exists, the assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount, and is recognized in the Profit & Loss Account. An impairment loss is reversed if there has been a change in the estimate of recoverable amount. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, if no impairment loss had been recognized.

K. Provisions, Contingent Liabilities and Contingent Assets

A provision is made when there is a present obligation as a result of 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 or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. The Company does not recognize assets which are of contingent nature until there is virtual certainty of realisability of such assets. However, if it has become virtually certain that an inflow of economic benefits will arise, asset and related income is recognized in the financial statements of the period in which the change occurs.

 
Subscribe now to get personal finance updates in your inbox!