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Accounting Policies of Mihika Industries Ltd. Company

Mar 31, 2015

(A) Nature of operations:

The main business of the Company is that of Trading in Commodities and Fabrics, Commission Agent and Investment.

(B) Basis of Preparation of Financial Statements

(I) System of Accounting

The Financial Statements are prepared under the historical cost convention on accrual basis of accounting, in accordance with Generally Accepted Accounting Principles in India, the Accounting Standards notified under the relevant provisions of the Companies Act, 2013.

(II) Use of Estimates

The Preparation of Financial Statements in conformity with Generally Accepted Accounting Principles ( GAAP ) in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of financial statements and reported amounts of income and expenses during the period.

(C) Revenue Recognition

i) Sales comprise sale of commodities and fabrics. Revenue from sale is recognized:

a) when all the significant risks and rewards of ownership are transferred to the buyer which coincides with delivery and are recorded net of expenses incurred in this behalf.

b) no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale.

ii) Income from Investments is taken into account when the same are sold and the certainty of transaction is confirmed.

iii) Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

iv) Dividend Income is recognized on receipt basis.

(D) Fixed Assets and Depreciation

All fixed assets are stated at cost, comprising of purchase price, duty, levies and direct attributable cost of bringing the assets to their working condition for the intended use. Depreciation on fixed asset is provided using the straight line method based on rates specified in Schedule II of the Companies Act, 2013.

(E) Investments

Long Term Investments are stated at cost. The company provides for diminution, other than temporary, in the value of long term investments. Current Investments, if any are valued at cost or fair market value whichever is lower.

(F) Retirement Benefits

Contribution of Provident Fund, Gratuity and Leave encashment benefits wherever applicable is being accounted on actual liability basis as and when arises. However, the above referred provisions are not applicable to the company as it does not fall within the purview of the same in the year under review.

(G) Inventories

Inventories are valued at cost arrived at FIFO basis or net realizable value whichever is lower.

(H) Earning Per Share

The Basic and Diluted Earning Per Share ("EPS") is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.

(I) Provisions for Taxation

The expenses comprises of current tax( i.e. amount of tax for the period determined in accordance with the Income Tax Act, 1961) and deferred tax charges or credit (reflecting the tax effects of timing difference between accounting income and taxable income for the period).

The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantively enacted by the Balance Sheet date.

Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however. where there is unabsorbed depreciation or carry forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realization of such assets. Deferred tax assets are reviewed as at each Balance Sheet date to reassess realization.

(J) Provisions and Contingencies

i) Provision is recognized (for liabilities that can be measured by using a substantial degree of estimation) when:

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) A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will require an outflow of resources. When there is possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.


Mar 31, 2014

(A) Nature of operations :

The main business of the Company is that of Trading in Commodities and Fabrics, Commission Agent and Investment.

(B) Basis of Preparation of Financial Statements :

(a) System of Accounting

The Financial Statements are prepared under the historical cost convention on accrual basis of accounting, in accordance with Generally Accepted Accounting Principles in India, the Accounting Standards as notified under Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The Preparation of Financial Statements in conformity with Generally Accepted Accounting Principles ( GAAP ) in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of financial statements and reported amounts of income and expenses during the period .

(C) Revenue Recognition :

i) Sales comprise sale of commodities and fabrics. Revenue from sale is recognised :

a) when all the significant risks and rewards of ownership are transferred to the buyer which coincides with delivery and are recorded net of expenses incurred in this behalf.

b) no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale.

ii) Income from Investments is taken into account when the same are sold and the certainty of transaction is confirmed.

iii) Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

(D) Investments :

Long Term Investments are stated at cost. The company provides for diminution, other than temporary, in the value of long term investments. Current Investments, if any are valued at cost or fair market value whichever is lower.

(E) Retirement Benefits :

Contribution of Provident Fund, Gratuity and Leave encashment benefits wherever applicable is being accounted on actual liability basis as and when arises. However, the above referred provisions are not applicable to the company as it does not fall with in the purview of the same in the year under review.

(F) Inventories :

Inventories are valued at cost arrived at FIFO basis or net realisable value whichever is lower.

(G) Earning Per Share :

The Basic and Diluted Earning Per Share ("EPS") is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.

(H) Provisions for Taxation :

The expenses comprises of current tax( i.e. amount of tax for the period determined in accordance with the Income Tax Act, 1961) and defrred tax charges or credit (reflecting the tax effects of timing diffrence between accounting income and taxable income for the period).

The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the Balance Sheet date.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future; however, where there is unabsorbed depreciation or carry forward loss under taxation laws, deferred tax assets are recognized only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance Sheet date to reassess realisation.

(I) Provisions and Contingencies :

i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when :

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) 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 possible obligation or a present obligation in respect of which likelyhood of outflow of resources is remote, no provision or disclosure is made.


Mar 31, 2013

(A) Nature of Operations :

The main business of the Company is that of Trading in Fabrics, Commission Agent and Investment.

(B) Basis of Preparation of Financial Statements :

(a) System of Accounting

The Financial Statements are prepared under the historical cost convention on accrual basis of accounting, in accordance with Generally Accepted Accounting Principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The Preparation of Financial Statements in conformity with Generally Accepted Accounting Principles (GAAP) in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of financial statements and reported amounts of income and expenses during the period.

(C) Revenue Recognition :

(i) Sales comprise sale of fabrics. Revenue from sale of fabrics is recognised :

(a) when all the significant risks and rewards of ownership are transferred to the buyer which coincides with delivery and are recorded net of expenses incurred in this behalf.

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale.

(ii) Income from Investments is taken into account when the same are sold and the certainty of transaction is confirmed.

(iii) Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

(D) Fixed Assets and Depreciation :

All fixed assets are stated at cost, comprising of purchase price, duty, levies and direct attributable cost of bringing the assets to their working condition for the intended use. Depreciation is provided according to straight line method ar the rates prescribed by the Schedule XIV to the Companies Act, 1956 and Provision for impairment loss is recognised to the extent by which the carrying amount of an assets exceeds its recoverable amount.

(E) Investments :

Long Term Investments are stated at cost. The company provides for diminution, other than temporary, in the value of long term investments. Current Investments, if any are valued at cost or fair market value whichever is lower.

(F) Retirement Benefits :

Contribution of Provident Fund, Gratuity and Leave encashment benefits wherever applicable is being accounted on actual liability basis as and when arises. However, the above referred provisions are not applicable to the company as it does not fall with in the purview of the same in the year under review.

(G) Inventories :

Inventories are valued at cost arrived at FIFO basis or net realisable value whichever is lower.

(H) Earning Per Share :

The Basic and Diluted Earning Per Share ("EPS") is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.

(I) Provisions for Taxation :

The expenses comprises of current tax( i.e. amount of tax for the period determined in accordance with the Income Tax Act, 1961) and defrred tax charges or credit (reflecting the tax effects of timing diffrence between accounting income and taxable income for the period).

The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the Balance Sheet date.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future; however, where there is unabsorbed depreciation or carry forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance Sheet date to reassess realisation.

(J) Provisions and Contingencies :

(i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when :

(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) 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 outflowof resources. When there is possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.


Mar 31, 2012

1 Nature of operations

The main business of the Company is that of Trading in Fabrics and Commission Agency.

2 Basis of Accounting

The Financial Statements have been prepared to comply in all material respects with applicable accounting standards as notified by the Central Government under Companies (Accounting standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on accrual basis except claims/refunds which are accounted for on receipt basis due to uncertainties. The accounting policies have been consistently applied by the company and are consistent with those used in previous year.

3 Uses of Estimates

The preparation of Financial Statements, in conformity with the Generally Accepted Accounting Principles, requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results materialises.

4 Revenue Recognition

i) Sales comprise sale of fabrics. Revenue from sale of fabrics is recognised:

a) when all the significant risks and rewards of ownership are transferred to the buyer which coincides with delivery and are recorded net of expenses incurred in this behalf.

b) no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale.

ii) Income from Investments is taken into account when the same are sold and the certainty of transaction is confirmed.

iii) Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

5 Investments

Long Term Investments are stated at cost. The company provides for diminution, other than temporary, in the value of long term investments. Current Investments, if any are valued at cost or fair market value whichever is lower.

6 Retirement Benefits

Contribution of Provident Fund, Gratuity and Leave encashment benefits wherever applicable is being accounted on actual liability basis as and when arises. However, the above referred provisions are not applicable to the company as it does not fall with in the purview of the same in the year under review.

7 Dues to SMEs

There are no dues to Micro and Small Enterprises, that are reportable under the Micro, Small and Medium Enterprises Development Act, 2006

8 Taxation

a. Current Tax

Current Tax is determined as the amount of tax payable in respect of taxable income for the year under the provisions of the Income Tax Act, 1961 of India

b. Deferred Tax

Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

9 Provisions

i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when:

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


Mar 31, 2011

1. FIXED ASSETS: These are stated at their original cost of acquisition including all the related expenses which are attributable to bringing them to their present condition. However, the company has no fixed assets as on 31.03.2011

2. DEPRECIATION: Depreciation on fixed assets is provided on written down value method at the rates and in the manner as prescribed under Schedule XIV to the Companies Act, 1956.

3. INVESTMENTS: Investments are classified into long term and current categories. Long Term investments are carried at cost less provision, if any, for permanent diminution in value of such investments. Current Investments are carried at lower of cost or market value.

4. REVENUE RECOGNITION

i) Income from Investments is recognized as and when received.

ii) All other income & expenditure are recognized on accrual basis.

5. CONTINGENT LIABILITIES: Contingent Liabilities are not provided for in the accounts but are disclosed by way of notes in the NOTES ON ACCOUNTS, if any.

6. INCOME TAX: Tax provisions comprises both current and deferred taxes. Deferred income tax reflects the impact of current year timing differences between taxable income and accounting income for the and reversal of timing differences of earlier years. Deferred tax assets and liabilities are measured using the tax rates and the tax iaw that have been enacted or subsequently enacted at the * Balance Sheet date. Deferred tax assets are recognized to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.