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Accounting Policies of Marsons Ltd. Company

Jun 30, 2015

A) Basis of Preparation of Financial Statement

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act'). The financial statement have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

b) Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statement are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known/materialize.

c) Fixed Assets and Depreciation/Amortization

Tangible Fixed Assets are stated at historical cost less accumulated depreciation. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the asset to its working condition for the intended use.

Depreciation on tangible assets, is provided using the written down value method as per the useful life of various assets specified under Schedule II to the Companies Act, 2013. In respect of fixed assets purchased during the year, depreciation is provided on a pro-rata basis from the date on which such asset is ready to put to use.

Pursuant to the transition provision prescribed in Schedule II to the Act, the Company has fully depreciated the carrying value of assets, where the remaining useful life of the asset was determined to be Nil as on 1st April, 2014.

Intangible Fixed Assets are stated at historical cost less accumulated amortization. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the asset to its working condition for the intended use. Cost is amortized over its useful economic life based on expected benefit.

d) Investments

Long-term investments are carried at cost less any other than temporary diminution in value, determined separately for each individual investment. Current investment are carried at lower of cost and fair value.

e) Inventories

Inventories are valued at lower of cost and estimated net realizable value. Raw Materials and stores & spares have been accordingly valued at average cost including all costs incurred in bringing the inventories to their present location and condition. Finished Goods and Work-in-progress include proportion of costs of conversion.

f) Revenue Recognition

Revenue from sales of transformers are recognized on dispatch of goods to the customers.

g) Sales and Service Income

Sales are stated net of excise duties, sales tax and trade discount and Service income excludes service tax.

h) Other Income

Interest income is accounted on accrual basis.

i) Cenvat Credit

Cenvat Credit is accounted for on accrual basis on purchase of eligible inputs, capital goods and services.

j) Employee Benefits

(a) Defined Contribution Plans :

Contribution to provident fund, pension schemes and employee's state insurance scheme are defined contribution schemes and are charged to profit and loss account for the year. The Company makes specified monthly contributions towards employee's provident fund to the Regional Provident Fund Commissioner. Compensated absences are short term and recognized on an undiscounted accrual basis during the period when the employee renders service.

(b) Defined Benefit plans:

Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation made at the end of each financial year using project unit credit method.

Contribution is made annually to Gratuity Fund under approved Group Gratuity scheme with Life Insurance Corporation of India and charged to revenue.

k) Taxation

Income tax expense comprises current tax expense and deferred tax expense/credit.

a) Current Tax

Provision for current tax is calculated in accordance with the provision of the Income Tax Act, 1961 and is made annually based on the tax liability computed after considering tax allowances and exemptions.

b) Deferred Tax

Deferred tax liability or asset is recognized for timing differences between the profit/loss offered for income taxes and profits/losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rate and tax law that have been enacted or substantively enacted at the balance sheet date.

l) Earnings per share ('EPS')

Basic EPS is computed using the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent share outstanding during the year expect where the results would be anti dilutive. The number of equity shares is adjusted for any share splits and bonus shares issued effected prior to the approval of the financial statements by the Board of Directors.

m) Research and Development Expenses

All revenue expenditure pertaining to research are charged to the profit and loss account in the year in which they are incurred and development expenditure of capital nature is capitalized as fixed assets and depreciation as per the company policy.


Mar 31, 2014

1. BASIS OF ACCOUNTING

a) The accounts prepared in accordance with historical cost convention and modified by revaluation of certain fixed assets. Both income and expenditure are recognized on accrual basis except for insurance, bonus, leave encashment and gratuity accounted as and when paid.

b) FIXED ASSETS

i) Fixed assets are stated at original cost less accumulated depreciation with the exception of Land and Factory Building, which were revalued in 1988-89 & 2006-07, to correspond to the market values as per valuation certificate.

c) Depreciation

Depreciation on fixed assets has been calculated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956. Additional charge of depreciation on differential increase in value arising out of revaluation is adjusted against withdrawal from revaluation reserve.

d) nvestments

Investments held are long term in nature and stated at cost unless there is permanent diminution in value.

e) Inventories

Inventories are valued at lower of cost and estimated net realizable value including excise duty. Raw Material and Stores & Spares have been accordingly valued at average cost. Work-in- progress has been valued at cost including conversion costs incurred to bring the same to present location and condition.

f) Sales

Sales include excise duties, remission of sales tax on expended unit and scrap sales.

g) Revenue Recognition

Sales of transformers are recognized on dispatch of goods to the customers.

h) RETIREMENT BENEFITS

a) Defined Contribution Plans

Contribution to provident fund, pension schemes and employee''s state insurance scheme are defined contribution schemes and are charged to profit and loss account for the year. The Company makes specified monthly contributions towards employee''s provident fund to the Regional Provident Fund Commissioner. Compensated absences are short term and recognized on an undiscounted accrual basis during the period when the employee renders service.

b) Defined Benefit Plans

Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation made at the end of each financial year using project unit credit method. Contribution is made annually to Gratuity Fund under approved Group Gratuity scheme with Life Insurance Corporation of India and charged to revenue.

i) RESEARCH AND DEVELOPMENT EXPENSES

All revenue expenditure pertaining to research are charge to the profit and loss account in the year in which they are incurred and development expenditure of capital nature is capitalised as fixed assets and depreciation as per the company policy.


Jun 30, 2013

A) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared in accordance with historical cost convention and modified by revaluation of certain fixed assets. Both income and expenditure are recognized on accrual basis except for insurance, bonus, leave encashment and gratuity accounted as and when paid.

b) FIXED ASSETS

i) Fixed assets are stated at original cost less accumulated depreciation with the exception of Land and Factory Building, which were revalued in 1988-89 & 2006-07, to correspond to the market values as per valuation certificate.

ii) Cost comprises purchase price, non refundable taxes, duties, freight and incidental expenses related to the acquisition and installation of the assets as well as finance charges wherever applicable relating to borrowed funds attributable to construction/acquisition of fixed assets for the period up to commencement of commercial production/assets put into use.

iii) In respect of revalued assets, the difference between written down values of the assets as on the date of revaluation and the then replacement value is transferred to revaluation reserve.

c) Depreciation

i) Depreciation on fixed assets has been calculated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956. Additional charge of depreciation on differential increase in value arising out of revaluation is adjusted against withdrawal from revaluation reserve.

ii) On assets individually costing less than R. 5000/- depreciation at the rate of 100% is being provided, subject to aggregate actual cost of individual item of plant and machinery costing R.5000/- or less being less than 10% of total cost of plant and machinery.

d) Investments

Investments held are long term in nature and stated at cost unless there is permanent diminution in value.

e) Inventories

Inventories comprise of WIP, Raw Material and Stores & Spares are valued at Lower of Cost and Net Realisable value. Cost basis is adopted on Average Cost Method. WIP at Cost includes conversion cost to bring the same to present location and condition.

f) Revenue Recognition

Sales include excise duties, remission of sales tax on expanded unit and scrap sales. Sales of transformers are recognized on dispatch of goods to the customers.

g) RETIREMENT BENEFITS

i) Defined Contribution Plans

Contribution to provident fund, pension schemes and employee''s state insurance scheme are defined contribution schemes and are charged to profit and loss account for the year. The Company makes specified monthly contributions towards employee''s provident fund to the Regional Provident Fund Commissioner. Compensated absences are short term and recognized on an undiscounted accrual basis during the period when the employee renders service.

ii) Defined Benefit Plans

Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation made at the end of each financial year using project unit credit method Contribution is made annually to Gratuity Fund under approved Group Gratuity scheme with Life Insurance Corporation of India and charged to revenue.

h) PROVISIONS FOR CURRENT TAX & DEFERRED TAX

Provision for current tax is computed after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from timing difference between book profits and taxable profits is accounted for using the tax rates and laws that are enacted or substantively enacted as on the Balance Sheet date. Deferred tax asset is recognised and carried forward if there is a reasonable certainty that the asset will be realised in future.

i) IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is to be charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss, if recognised in any accounting period, is reversible if there is any change in the estimate of recoverable amount.

j) GOVERNMENT GRANTS

Provision for current tax is computed after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from timing difference between book profits and taxable profits is accounted for using the tax rates and laws that are enacted or substantively enacted as on the Balance Sheet date. Deferred tax asset is recognised and carried forward if there is a reasonable certainty that the asset will be realised in future.

k) RESEARCH AND DEVELOPMENT EXPENSES

All revenue expenditure pertaining to research are charge to the profit and loss account in the year in which they are incurred and development expenditure of capital nature is capitalised as fixed assets and depreciation as per the company policy.

In pursuit of Research and Development endeavors the company is continuously incurring R & D expenditure both on Capital and Revenue which is shown as part of regular heads of accounts in fixed assets and in Profit and Loss account respectively. The Company has started recognizing expenses incurred on R & D both on Capital and Revenue which are as below:

l) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial statements.


Mar 31, 2011

1. Basis of Accounting

a) The accounts are prepared in accordance with historical cost convention and modified by revaluation of certain fixed assets. Both income and expenditure are recognized on accrual basis except for insurance, bonus, leave encashment and gratuity accounted as and when paid.

b) Fixed Assets

Fixed assets are stated at original cost less accumulated depreciation with the exception of Land and Factory Building, which were revalued in 1988-89 & 2006-07, to correspond to the market values as per valuation certificate.

c) Depreciation

Depreciation on fixed assets has been calculated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956. Additional charge of depreciation on differential increase in value arising out of revaluation is adjusted against withdrawal from revaluation reserve.

d) Investments

Investments held are long term in nature and stated at cost unless there is permanent diminution in value.

e) Inventories

Inventories are valued at lower of cost and estimated net realisable value including excise duty. Raw Materials and stores & spares have been accordingly valued at average cost. Work-in-progress has been valued at cost including conversion costs incurred to bring the same to present location and condition.

f) Sales

Sales include excise duties, remission of sales tax on expanded unit and scrap sales.

g) Revenue Recognition

Sales of transformers are recognised on dispatch of goods to the customers.

h) Retirement Benefits

(a) Defined Contribution Plans

Contribution to provident fund, pension schemes and employee's state insurance scheme are defined contribution schemes and are charged to profit and loss account for the year. The Company makes specified monthly contributions towards employee's provident fund to the Regional Provident Fund Commissioner. Compensated absences are short term and recognized on an undiscounted accrual basis during the period when the employee renders service.

(b) Defined Benefit Plans

Gratuity liability is a defined benefit obligation and is provided for on the basis of actuarial valuation made at the end of each financial year using project unit credit method

Contribution is made annually to Gratuity Fund under approved Group Gratuity scheme with Life Insurance Corporation of India and charged to revenue.

i) Research and Development Expenses

All revenue expenditure pertaining to research are charge to the profit and loss account in the year in which they are incurred and development expenditure of capital nature is capitalised as fixed assets and depreciation as per the company policy.


Mar 31, 2010

Basis of Accounting

a) The accounts are prepared in accordance with historical cost convention and modified by revaluation of certain fixed assets. Both income and expenditure are recognized on accrual basis except for insurance, bonus, leave encashment and gratuity accounted as and when paid.

b) Fixed Assets

Fixed assets are stated at original cost less depreciation with the exception of Land and Factory Building, which were revalued in 1988-89 & 2006-07, to correspond to the market values as per valuation certificate.

c) Depreciation

Depreciation on fixed assets has been calculated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956. Additional charge of depreciation on differential increase in value arising out of revaluation is adjusted against withdrawal from revaluation reserve.

d) Investments

Investments held are long term in nature and stated at cost unless there is permanent diminution in value.

e) Inventories

Inventories are valued at lower of cost and estimated net realisable value including excise duty. Raw Materials and stores & spares have been accordingly valued at average cost. Work-in-progress has been valued at cost including conversion costs incurred to bring the same to present location and condition.

f) Sales

Sales include excise duties, remission of sales tax on expanded unit and scrap sales.

g) Revenue Recognition

Sales of transformers is recognised on dispatch of goods to the customers and of power sale on bill raised. h) Retirement Benefits

i) Defined Contribution Plans

Contribution to provident fund, pension schemes and employees state insurance scheme are defined contribution schemes and are charged to profit and loss account for the year. The Company makes specified monthly contributions towards employees provident fund to the Regional Provident Fund Commissioner Compensated absences are short term and recognized on an undiscounted accrual basis during the period when the employee renders service.

ii) Defined Benefit Plans

Gratuity liability is a defined benefit obligation and is provided for on the basis of acturial valuation made at the end of each financial year using project unit credit method

Contribution is made annually to Gratuity Fund under approved Group Gratuity scheme with Life Insurance Corporation of India and charged to revenue.

 
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