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Mangalam Ventures Ltd. Accounting Policies | Accounting Policy of Mangalam Ventures Ltd.
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Accounting Policies of Mangalam Ventures Ltd. Company

Mar 31, 2014

A) Basis of Preparation of Financial Statements : The Financial Statements have been prepared under the Historical Cost Convention in accordance with generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company. The same are prepared on a going concern basis.

All assets and liabilities have been classified as current or non-current as per the operating cycle criteria set out in the Revised Schedule VI to the Companies Act, 1956.

b) Use of Estimates : The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are recognised in the period in which they materialise.

c) Subsidy : Government subsidies available to the Company are recognised when there is a reasonable assurance of compliance with the conditions attached to such subsidies and where benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Subsidy on specified fixed assets under TUF scheme is treated as deferred Subsidy and is recognised as income in the Statement of Profit and Loss account over its useful life.

d) Fixed Assets : Fixed Assets are stated at the acquisition cost including directly attributable cost for bringing the assets to working condition for use. Pre-production cost including interest on specific loan for the project incurred till the project is ready for commercial production is capitalised.

An Intangible asset is recognized, where it is probable that the future economic benefits attributable to the asset will flow to the enterprises and where its cost can be reliably measured. Intangible assets are stated at cost of acquisition less amortization.

e) Depreciation and Amortization : Depreciation on the tangible fixed assets is provided at the rates specified in Schedule- XIV of the Companies Act, 1956, on Straight Line Method. Amortization on the intangible assets is provided on the straight line method based on management''s estimate of useful life i.e. 4 years.

f) Investments : Long Term Investments are stated at cost.Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management. Current Investments are stated at cost and/or quoted value/fair value whichever is less.

g) Inventories : Raw materials, stores, spares and packing materials are valued on First In First Out basis at cost. Work in progress is valued at estimated cost. Finished goods are valued at lower of cost or net realisable value.

h) Foreign Currency Transactions : Transactions in foreign currency are accounted at the exchange rates prevailing on the date of transactions. The assets and liabilities receivable/payable in foreign currency at the year end are stated at the average foreign exchange rates of forward exchange contracts and the uncovered amount valued at exchange rate prevailing at the year end. The overall gain/loss, if any, on realisation of current assets/liabilities is dealt with in the Statement of Profit and Loss . Profit or Loss arising on cancellation of forward exchange contracts is recognised in the period in which the contract is cancelled.

i) Recognition of Income and Expenditure : All income and expenditure is accounted on accrual basis. Export sales are accounted on the basis of date of Bill of Lading. Sales are shown exclusive of sales tax.

j) Employee Benefits :

Contribution to Provident and other funds are funded with the appropriate authorities and charged to the Statement of Profit and Loss.

Liabilitiy for gratuity and earned leaves at the year end is provided on the basis of actuarial valuation and funded with Life Insuarance Corporation of India and charged to the Statement of Profit and Loss.

k) Taxation :

Provision for current income tax is made on the taxable income using the applicable tax rates and tax laws. Deferred tax arising on account of timing differences and which are capable of reversal in one or more subsequent periods is recognised using the tax rates and tax laws that have been enacted or substantively enacted.

l) Borrowing Cost :

Interest and other costs incurred in connection with borrowing of the funds are charged to revenue on accrual basis except those borrowing costs which are directly attributable to the acquisition or construction of those fixed assets, which necessarily take a substantial period of time to get ready for their intended use. Such costs are capitalised with the fixed assets.

m) Earnings Per Share:

The earnings considered in ascertaining the Company''s EPS comprise of the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the period.The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless the effect of the potential dilutive equity shares is anti dilutive.

n) Provisions & Contingent Liability :

Provisions are recognised when the Company has a present obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. A contingent liability is disclosed where there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources.


Mar 31, 2012

A) Basis of Preparation of Financial Statements : The Financial Statements have been prepared under the Historical Cost Convention in accordance with generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company The same are prepared on a going concern basis.

All assets and liabilities have been classified as current or non-current as per the operating cycle criteria set out in the Revised Schedule VI to the Companies Act, 1956

b) Use of Estimates : The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto Differences between actual results and estimates are recognised in the period in which they materialise.

c) Subsidy : Government subsidies available to the Company are recognised when there is a reasonable assurance of compliance with the conditions attached to such Subsidies and where benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Subsidy on specified fixed assets under TUF scheme is treated as deferred Subsidy and is recognised as income in the Statement of Profit and Loss account over its useful life.

d) Fixed Assets : Fixed Assets are stated at the acquisition cost including directly attributable cost for bringing the assets to working condition for use. Pre-production cost including interest on specific loan for the project incurred till the project is ready for commercial production is capitalised

An Intangible asset is recognized, where it is probable that the future economic benefits attributable to the asset will flow to the enterprises and where its cost can be reliably measured. Intangible assets are stated at cost of acquisition less amortization.

Capital work-in-progress comprises capital assets which are not yet put to use.

e) Depreciation and Amortization : Depreciation on the fixed assets is provided at the rates specified in Schedule-XIV of the Companies Act, 1956, on Straight Line Method. Amortization on the intangible assets is provided on the straight line method based on management's estimate of useful life i.e. 4 years for Knowledge-based content.

f) Investments : Long Term Investments are stated at cost. Current Investments are stated at cost and/or quoted value/ fair value whichever is less.

g) Inventories : Raw materials, stores, spares and packing materials are valued on First In First Out basis at cost. Work in progress is valued at estimated cost Finished goods are valued at lower of cost or net realisable value.

h) Foreign Currency Transactions : Transactions in foreign currency are accounted at the exchange rates prevailing on the date of transactions. The assets and liabilities receivable/payable in foreign currency at the year end are stated at the average foreign exchange rates of forward exchange contracts and the uncovered amount valued at exchange rate prevailing at the year end. The overall gain/loss, if any, on realisation of current assets/liabilities is dealt with in the Statement of Profit and Loss . Profit or Loss arising on cancellation of forward exchange contracts is recognised in the period in_which the contract is cancelled.

i) Recognition of Income and Expenditure : All income and expenditure is accounted on accrual basis. Export sales are accounted on the basis of date of Bill of Lading. Sales are shown exclusive of sales tax.

j) Employee Benefits :

Contribution to Provident and other funds are funded with the appropriate authorities and charged to the Statement of Profit and Loss.

Liabilitiy for gratuity and earned leaves at the year end is provided on the basis of actuarial valuation and funded with Life Insuarance Corporation of India and charged to the Statement of Profit and Loss.

k) Taxation :

Provision for current income tax is made on the taxable income using the applicable tax rates and tax laws.Deferred tax arising on account of timing differences and which are capable of reversal in one or more subsequent periods is recognised using the tax rates and tax laws that have been enacted or substantively enacted.

I) Borrowing Cost :

Interest and other costs incurred in connection with borrowing of the funds are charged to revenue on accrual basis except those borrowing costs which are directly attributable to the acquisition or construction of those fixed assets , which necessarily take a substantial period of time to get ready for their intended use. Such costs are capitalised with the fixed assets.

m) Earnings Per Share:

The earnings considered in ascertaining the Company's EPS comprise of the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the period.The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless the effect of the potential dilutive equity shares is anti dilutive.

n) Provisions & Contingent Liability :

Provisions are recognised when the Company has a present obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. A contingent liability is disclosed where there is a possible, obligation or a present obligation that may, but probably will not, require an outflow of resources.


Mar 31, 2011

A) Basis of Accounting : The Financial Statements have been prepared under the Historical Cost Convention in accordance with generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company. The same are prepared on a going concern basis.

b) Use of Estimates : The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are recognised in the period in which they materialise.

c) Subsidy : Government subsidies available to the Company are recognised when there is a reasonable assurance of compliance with the conditions attached to such subsidies and where benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Subsidy on specified fixed assets under TUF scheme is treated as deferred Subsidy and is recognised as income in the profit and loss account over its useful life.

d) Fixed Assets : Fixed Assets are stated at the acquisition cost including directly attributable cost for bringing the assets to working condition for use. Pre-production cost including interest on specific loan for the project incurred till the project is ready for commercial production is capitalised.

An Intangible asset is recognized, where it is probable that the future economic benefits attributable to the asset will flow to the enterprises and where its cost can be reliably measured. Intangible assets are stated at cost of acquisition less amortization.

Capital work-in-progress comprises capital assets which are not yet put to use and also include outstanding advances paid.

e) Depreciation/Amortization : Depreciation on the fixed assets is provided at the rates specified in Schedule-XIV of the Companies Act, 1956, on Straight Line Method. Amortization on the intangible assets is provided on the straight line method based on management's estimate of useful life i.e. 4 years for Knowledge-based content.

f) Investments : Long Term Investments are stated at cost.Short Term Investments are stated at cost and/or quoted value/fair value whichever is less.

g) Inventories : Raw materials, stores, spares and packing materials are valued on First In First Out basis at cost. Work in process is valued at estimated cost. Finished goods are valued at lower of cost or net realisable value.

h) Foreign Currency Transactions :Transactions in foreign currency are accounted at the exchange rates prevailing on the date of transactions. The assets and liabilities receivable/payable in foreign currency are stated at the average foreign exchange rates of forward booking and the uncovered amount valued at exchange rate prevailing at the year end. The overall gain/loss, if any, on realisation of current assets/liabilities is dealt with in the Profit and Loss Account

i) Recognition of Income and Expenditure :AII income and expenditure is accounted on accrual basis. Export sales are accounted on the basis of date of Bill of Lading. Sales are shown exclusive of sales tax.

j) Employee Benefits :

i) Short Term Employee Benefits (Benefits which are payable with in twelve months after the end of the period in which the employee renders service) are measured at cost.

ii) Long Term Employee Benefits (Benefits which are payable after the end of the twelve months in which the employee renders service) and post employment benefits (which are payable on completion of employment) are measured on a discounted basis by the projected unit credit method on the basis of actuarial valuation annually.

iii) Contributions to Provident Fund, a defined contribution plan are made in accordance with the statute and are recognised as an expense when employees have rendered service entitling them to re-contribution.

iv) The eligible employees can accumulate unavailed privilege leave and are entitled to encash the same either while in employment, on termination or on retirement in accordanace with the Company's Policy. The present value of such unavailed leave is measured using the projected unit cost method, with actuarial valuations being carried out at each Balance Sheet date.

v) The cost of providing gratuity, a defined contribution plan, is determined using projected unit credit method on the basis of actuarial valuation carried out by actuaries at each Balance Sheet date. The gratuity benefit, obligation recognised in Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets. k) Provisions and Contingent Liabilities :

i) Provisions are recognised for liabilities that can be measured by using a substantial degree of estimation, if:

a) the Company has a present obligation as a result of a past event;

b) a probable outflow of resources embodying economic benefits is expected to settle the obligation; and

c) the amount of the obligation can be reliably estimated. ii) Contingent liability is disclosed in the case of:

a) a present obligation arising from a past event when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or

b) a possible obligation, unless the probability of outflow in settlement is remote

iii) Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the reimbursement will be received.

I) Taxes on Income :

i) Tax liability of the Company is estimated considering the provision of the Income Tax Act, 1961. Deferred Tax is recognised subject to the consideration of prudence, on timing differences, in respect of difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.


Mar 31, 2010

A) Basis of Accounting : The Financial Statements have been prepared under the Historical Cost Convention in accordance with generally accepted accounting principles and the provisions of the Companies Act, 1956 as adopted consistently by the Company. The same are prepared on a going concern basis.

b) Use of Estimates : The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are recognised in the period in which they materialise.

c) Subsidy : Government subsidies available to the Company are recognised when there is a reasonable assurance of compliance with the conditions attached to such subsidies and where benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Subsidy on specified fixed assets under TUF scheme is treated as deferred Subsidy and is recognised as income in the profit and loss account over its useful life.

d) Fixed Assets : Fixed Assets are stated at the acquisition cost including directly attributable cost for bringing the assets to working condition for use. Pre-production cost including interest on specific loan for the project incurred till the project is ready for commercial production is capitalised.

An Intangible asset is recognized, where it is probable that the future economic benefits attributable to the asset will flow to the enterprises and where its cost can be reliably measured. Intangible assets are stated at cost of acquisition less amortization.

Capital work-in-progress comprises capital assets which are not yet put to use and also include outstanding advances paid.

e) Depreciation/Amortization : Depreciation on the fixed assets is provided at the rates specified in Schedule-XIV of the Companies Act, 1956, on Straight Line Method. Amortization on the intangible assets is provided on pro-rata basis on the straight line method based on managements estimate of useful life i.e. 4 years for Knowledge-based content.

f) Investments : Long Term Investments are stated at cost. Short Term Investments are stated at cost and/or quoted value/fair value.

g) Inventories : Raw materials, stores, spares and packing materials are valued on First In First Out basis at cost. Work in process is valued at estimated cost. Finished goods are valued at lower of cost or net realisable value.

h) Foreign Currency Transactions :Transactions in foreign currency are accounted at the exchange rates prevailing on the date of transactions. The assets and liabilities receivable/payable in foreign currency are stated at the average foreign exchange rates of forward booking and the uncovered amount valued at exchange rate prevailing at the year end. The overall gain/loss, if any, on realisation of current assets/liabilities is dealt with in the Profit and Loss Account.

i) Recognition of Income and Expenditure :All income and expenditure is accounted on accrual basis. Export sales are accounted on the basis of date of Bill of Lading. Sales are shown exclusive of sales tax.

j) Employee Benefits :

i) Short Term Employee Benefits (Benefits which are payable with in twelve months after the end of the period in which the employee renders service) are measured at cost.

ii) Long Term Employee Benefits (Benefits which are payable after the end of the twelve months in which the employee renders service) and post employment benefits (which are payable on completion of employment) are measured on a discounted basis by the projected unit credit method on the basis of actuarial valuation annually.

iii) Contributions to Provident Fund, a defined contribution plan are made in accordance with the statute and are recognised as an expense when employees have rendered service entitling them to re-contribution.

iv) The eligible employees can accumulate unavailed privilege leave and are entitled to encash the same either while in employment, on termination or on retirement in accordanace with the Companys Policy. The present value of such unavailed leave is measured using the projected unit cost method, with actuarial valuations being carried out at each Balance Sheet date.

v) The cost of providing gratuity, a defined contribution plan, is determined using projected unit credit method on the basis of actuarial valuation carried out by actuaries at each Balance Sheet date. The gratuity benefit, obligation recognised in Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets,

k) Provisions and Contingent Liabilities :

i) Provisions are recognised for liabilities that can be measured by using a substantial degree of estimation, if:

a) the Company has a present obligation as a result of a past event;

b) a probable outflow of resources embodying economic benefits is expected to settle the obligation; and

c) the amount of the obligation can be reliably estimated.

ii) Contingent liability is disclosed in the case of :

a) a present obligation arising from a past event when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or

b) a possible obligation, unless the probability of outflow in settlement is remote

iii) Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the reimbursement will be received.

l) Taxes on Income :

i) Tax liability of the Company is estimated considering the provision of the Income Tax Act, 1961. Deferred Tax is recognised subject to the consideration of prudence, on timing differences, in respect of difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

 
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