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Accounting Policies of Mangalam Drugs and Organics Ltd. Company

Mar 31, 2016

a. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to under Section 133 of the Companies Act,2013,read with Rule 7 of the Companies (Accounts) Rules, 2014, the relevant provisions of the Companies Act, 2013 / Companies Act, 1956 as applicable & guidelines issued by the Securities and Exchange Board of India(SEBI),as applicable .

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognized on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company’s fixed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specified in the Schedule II of the Companies Act, 2013.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower.

ii) Stock in process is valued at cost determined by taking in to material cost, Labour charges & other direct expenses

iii) Finished goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realized on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amount paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year is considered as finance charges.

i. RETIREMENT BENEFITS

i) The Company makes regular monthly contribution to provident and pension fund Maintained by provident fund commissioners.

ii) Defined Benefit plan in the form of gratuity are determined using the projected Unit credit method as at Balance sheet date

iii) The Company has provided for leave encashment for the leave balances as on 31st March, 2016

j. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Profit and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable profit of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the profit & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 “Accounting for Taxes on Income” issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.

iii) During the year the company has taken credit for entitlement of Minimum Alternate Tax(MAT) Liability since the company is of the view that MAT liability of current year is allowable deduction for Actual liability for future periods.

c) Terms / Right attached to equity shares

The Company has one class of issued shares referred to as equity shares having a par value Rs 10/-each holder of equity shares is entitled to one vote per share. The dividend proposed by the board of directors, If any, is subjected to the approval of shareholders in Annual General Meeting. In the event of liquidation of the Company the holder of the equity shares will be entitled to receive remaining assets of the Company after settlement of all preferential amount. The distribution will be in proportion to the number of Equity Shares held by Equity Shareholders.


Mar 31, 2015

A. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to in section 133 of Companies Act 2013, as adopted consistently by the Company.

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognised on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company's fixed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e. METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specifies in the Schedule XIV of the Companies Act, 1956.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower.

ii) Stock in process is valued at cost determined by taking in to material cost, Labour charges & other direct expenses

iii) Finish goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realized on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amount paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year is considered as finance charges.

I. RETIREMENT BENEFITS

i) The Company makes regular monthly contribution to provident and pension fund Maintained by provident fund commissioners.

ii) Defined Benefit plan in the form of gratuity are determined using the projected Unit credit method as at Balance sheet date

iii) The Company has provided for leave encashment for the leave balances as on 31st March, 2015

j. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Profit and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable profit of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the profit & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.

iii) During the year the company has taken credit for entitlement of Minimum Alternate Tax(MAT) Liability since the company is of the view that MAT liability of current year is allowable deduction for Actual liability for future periods.


Mar 31, 2014

A. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to in section 211(3C) of Companies Act 1956, as adopted consistently by the Company.

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognised on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company''s fixed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e. METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specifies in the Schedule XIV of the Companies Act, 1956.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower. ii) Stock in process is valued at cost determined by taking in to material cost, Labour charges & other direct expenses iii) Finish goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realized on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amount paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year is considered as finance charges.

I. RETIREMENT BENEFITS

i) The Company makes regular monthly contribution to provident and pension fund Maintained by provident fund commissioners.

ii) Defined Benefit plan in the form of gratuity are determined using the projected Unit credit method as at Balance sheet date

iv) The Company has provided for leave encashment for the leave balances as on 31st March, 2013

j. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Profit and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable profit of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the profit & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.

c) Terms / Right attached to equity shares

The Company has one class of issued shares referred to as equity shares having a par value Rs 10/-each holder of equity shares is entitled to one vote per share. The dividend proposed by the board of directors, If any,is subjected to the approval of shareholders in Annual General Meeting.In the event of liqauidation of the Company the holder of the equity shares will be entitled to receive remaining assets of the Company after settlement of all preferential amount. The distribution will be in proportion to the number of equity shares held by the equity shareholders.


Mar 31, 2013

A. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to in section 211(3C) of Companies Act, 1956, as adopted consistently by the Company.

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognised on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company''s fxed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specifes in the Schedule XIV of the Companies Act, 1956.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower.

ii) Stock in process is valued at cost determined by taking in to material cost, Labour charges & other direct expenses

iii) Finish goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realized on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amount paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year is considered as fnance charges.

I. RETIREMENT BENEFITS

i) The Company makes regular monthly contribution to provident and pension fund Maintained by provident fund commissioners. ii) Defned Beneft plan in the form of gratuity are determined using the projected Unit credit method as at Balance sheet date iii) The Company has provided for leave encashment for the leave balances as on 31st March, 2013.

j. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Proft and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable proft of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the proft & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.


Mar 31, 2012

A. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to in section 211(3C) of Companies Act 1956, as adopted consistently by the Company.

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognised on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company's fixed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e. METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specifies in the Schedule XIV of the Companies Act, 1956.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower.

ii) Stock in process is valued at cost determined by taking in to material cost, Labour charges and other direct expenses.

iii) Finish goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realized on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amoCint paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year is considered as finance charges.

i. RETIREMENT BENEFITS

i) The Company makes regular monthly contribution to provident and pension fund maintained by provident fund commissioners.

ii) Defined Benefit plan in the form of gratuity are determined using the projected Unit credit method as at Balance sheet date

iii) The Company has provided for leave encashment for the leave balances as on 31st March, 2012 J. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Profit and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable profit of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the profit & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.


Mar 31, 2010

A. BASIS OF ACCOUNTING

1) The Books of Account are prepared under the Historical cost convention method using the accrual method of Accounting, based on principle of going concern and in accordance with the generally accepted accounting principle and the accounting standards referred to in section 211(c) of Companies Act 1956, as adopted consistently by the Company.

2) Excise and Custom duty is accounted for at the time of clearance of the goods.

3) Contingent Liabilities are disclosed by way of notes to accounts.

b. REVENUE RECOGNITION: -

i) Sale of goods is recognised on dispatch to customers. Amount of sale includes central excise duty, sales tax and other incidental expenses. Purchases are accounted on the basis of goods dispatched to the company by its suppliers. Purchases include central excise, sales tax and also custom duty, clearing and forwarding charges and bank charges in case of imports.

ii) Dividends are accounted on receipt basis.

iii) Income from services rendered is accounted for when the work is performed.

c. FIXED ASSETS

Fixed Assets are stated at cost of acquisition or construction net of CENVAT credit taken and are inclusive of freight, duties, taxes, interest up to the start of commercial production and incidental expenses.

d. IMPAIREMENT OF ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the companys fixed assets. If any indication exits, an assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is the greater of the net selling price and value in use.

e. METHOD OF DEPRECIATION

The company is charging depreciation on Straight Line Method at the rates and in the manner specifies in the Schedule XIV of the Companies Act, 1956.

f. INVESTMENTS

Investments are stated at cost.

g. INVENTORIES

i) Raw Materials & Packing materials are valued at Cost or net realizable value whichever is lower.

ii) Stock in process is valued at cost determined by taking in to material cost, labour charges and other direct- expenses.

iii) Finish goods are valued at cost or realizable market value whichever is lower.

h. FOREIGN CURRENCY TRANSACTIONS

i) In respect of Export of goods, the transactions in foreign currency are recorded in rupees of the amount realised on such export sale proceeds. However in respect of export sale proceeds those of which are outstanding on the last date of the year the same are accounted at foreign exchange rate prevailing on that date. The differences of export proceeds received in respect of outstanding export of earlier year are transferred to sales.

ii) In respect of Import of goods the transaction in foreign currency amount is recorded in rupees of the amount paid on such imports. However in respect of import purchases payable on last date of the year the same are accounted at foreign exchange rate prevailing on that date. The difference of payments for import purchase of earlier year is transferred to purchases.

iii) In respect of Foreign currency loan, exchange rate difference on loan outstanding at the end of the year and on repayments during the year are considered as finance charges.

i. RETIREMENT BENEFITS

(i) The Company makes regular monthly contribution to provident and pension fund maintained by provident fund commissioners.

(ii) Defined Benefit Plan in the form of gratuity are determined using the projected unit credit method as at Balance Sheet date.

(iii) The Company has provided for leave encashment for the leave balances as on 31st March 2010.

j. RESEARCH AND DEVELOPMENT

Revenue Expenditure on Research and Development is charged to Profit and Loss account in the year in which it is incurred.

k. TAXATION

i) The current charge for Income Tax is calculated on assessable profit of the company determine under Income Tax Act, 1961.

ii) The Company accounts for taxes on income to include the effect of timing difference in the tax expenses in the profit & loss account and the deferred tax assets and liabilities in the balance sheet in accordance with the Accounting Standard AS 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, (ICAI). The company has evaluated various elements of tax computation to determine whether any deferred tax asset or liability needs to be recognized.

l. PRELIMINERY EXPENSES

Preliminary expense relating to Public Issue is to be written off over a period of five years starting from the financial year 2005-06 and the year amount written off is Rs.24,16,981/27 (Total written off up to 31.03.2010 is Rs. 1,20,84,984.27)