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Accounting Policies of Manor Estates & Industries Ltd. Company

Mar 31, 2014

A) Basis of accounting:

The Financial Statements are prepared under the historical cost convention on an accrual basis and are in compliance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 and are in accordance with the require- ments of the Companies Act, 1956.

b) Sales are recognized on dispatches to customers and exclusive of excise duty wher- ever applicable.

c) Fixed Assets:

Fixed Assets are stated at cost less depreciation and capital work in progress is valued at cost.

d) Depreciation on fixed assets is provided on straight-line method at the rates speci- fied from time to time in schedule XIV of the Companies Act, 1956. Depreciation on additions / deductions during the year is calculated pro-rata from / to date of additions / deductions.

e) An asset is treated as impaired when the carrying cost of assets exceeds its recover- able value. An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired.

f) 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 an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are recognized as an expense in the period in which they are incurred.

g) Investment:

The investments that are made by the company are valued at cost or realizable value, whichever is less.

h) Inventories:

Inventories are valued as under:

Raw materials

Stores & Spares At Cost

Packing materials

Finished goods At cost or net realizable value whichever is lower.

Work – in – progress At cost

i) Retirement Benefits for Employees:

The provisions of Accounting Standard 15 on Accounting for Retirement Benefits in the Financial Statements of Employer issued by the Council of the Institute of Char- tered Accountants of India are being complied with by the company under the Provi- dent Fund Act. Gratuity is accounted for on cash basis.

j) Prior Period and Extraordinary items:

Income and expenditure pertaining to prior period as well as extraordinary items, where material are disclosed separately.

k) Foreign Exchange transactions:

Transactions in Foreign Currency are recorded at original rates of exchange in force at the time of the transaction. Gains/Losses, if any, at the year-end on account of restatement of current assets and current liabilities are accounted for in the state- ment of profit and loss.

Exchange Rate Fluctuations arising due to repayment of liabilities incurred for the purpose of acquiring fixed assets or due to restatement at the closing rate or at the forward rate contracted, as applicable, are accounted for in the statement of profit and loss.

l) The company is engaged in the business of manufacturing socks and there are no separate reportable primary and secondary segments as per Accounting Standard – 17 "Segment Reporting."

m) The company has not entered into any non-cancelable lease. Hence reporting as per Accounting Standard AS-19 "Accounting for Leases" does not arise.

n) The timing differences relating mainly to depreciation and unabsorbed losses up to 31st March, 2014, resulted in net deferred asset as per Accounting Standard – 22 "Accounting for Taxes on Income". As a prudent measure the net deferred assets relating to the above periods have not been recognized in the accounts.

o) Earnings per share:

Disclosure is made in the statement of profit and loss as per the requirement of the standard.


Mar 31, 2012

A) Basis of accounting: The Financial Statements are prepared under the historical cost convention on an accrual basis and are in compliance with the Accounting Standards

referred to in Section 211 (3C) of the Companies Act, 1956 and are in accordance with the requirements of the Companies Act, 1956.

b) Sales are recognized on dispatches to customers and exclusive of excise duty wherever applicable.

c) Fixed Assets: Fixed Assets are stated at cost less depreciation and capital work in progress is valued at cost.

d) Depreciation on fixed assets is provided on straight-line method at the rates specified from time to time in schedule XIV of the Companies Act, 1956. Depreciation on additions / deductions during the year is calculated pro-rata from / to date of additions / deductions.

e) An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired.

f) 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 an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. All other borrowing costs are recognized as an expense in the period in which they are incurred.

g) Investment: The investments that are made by the company are valued at cost or realizable value, whichever is less.

h) Inventories: Inventories are valued as under:

Raw materials Stores & Spares At Cost Packing materials Finished goods: At cost or net realizable value whichever is lower.

Work-in-progress: At cost

i) Retirement Benefits for Employees:

The provisions of Accounting Standard 15 on Accounting for Retirement Benefits in the Financial Statements of Employer issued by the Council of the Institute of Chartered Accountants of India are being complied with by the company under the Provident Fund Act. Gratuity is accounted for on cash basis.

j) Prior Period and Extraordinary items: Income and expenditure pertaining to prior period as well as extraordinary items, where material are disclosed separately. k) Foreign Exchange transactions: Transactions in Foreign Currency are recorded at original rates of exchange in force at the time of the transaction. Gains/Losses, if any, at the year-end on account of restatement of current assets and current liabilities are accounted for in the statement of profit and loss. Exchange Rate Fluctuations arising due to repayment of liabilities incurred for the purpose of acquiring fixed assets or due to restatement at the closing rate or at the forward rate contracted, as applicable, are accounted for in the statement of profit and loss. l) The company is engaged in the business of manufacturing socks and there are no separate reportable primary and secondary segments as per Accounting Standard - 17 "Segment Reporting." m) The company has not entered into any non-cancelable lease. Hence reporting as per Accounting Standard AS-19 "Accounting for Leases" does not arise. n) The timing differences relating mainly to depreciation and unabsorbed losses up to 31st March, 2012, resulted in net deferred asset as per Accounting Standard - 22 "Accounting for Taxes on Income".

As a prudent measure the net deferred assets relating to the above periods have not been recognized in the accounts.

o) Earnings per share: Disclosure is made in the statement of profit and loss as per the requirement of the standard.

 
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