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Accounting Policies of Modi Rubber Ltd. Company

Mar 31, 2014

1. Basis of Preparation of The financial statements are prepared Financial Statements in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on accrual basis, except in case of certain items of Income/Expenditure where recovery/payment is uncertain. GAAP comprises mandatory accounting standards as specified in the Companies. (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 2013 (to the extent notified), the Companies Act, 1956 (to the extent applicable), and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consis- tently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

2. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires managem- ent to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the financial statements and results of operations during the reported peri- od end. Examples of such estimates includes provision for diminution in value of investments, provision for doubtful debts, future obligations under defined benefit obligations under employee retirement benefit plans, provision for income tax and the useful lives of fixed and intangible assets. Although these estimates are based upon management''s best knowledge of current events and actions, actual result could differ from these estimates Accordingly, estimated benefits against exports remaining to be utilised / liability for duty free raw materials excess utilised as at the end of the year has been accounted for in arriving at the consumption of raw materials.

3. Inventory Valuation

(a) Raw Materials At weighted average cost (b) Goods-in-process Lower of Cost or net realisable value. (c) Finished Goods Lower of Cost or net realisable value. (d) Stores, Spares Parts At weighted average cost. and Loose Tools (e) Scrap and Wastage At estimated selling price. In respect of Finished goods and Goods in process, the cost is determined by considering material, related labour & overheads and duty thereon.

4. Depreciation Plant and Machinery on straight-line method and other Fixed Assets on red- ucing balance method at the rates spe- cified in Schedule XIV of the Compa- nies Act, 1956. Plant and Machinery are depreciated to the extent of 95% of its gross value considering the shelf life of 18 years.

5. Sales/Other Incomes Sales comprise sale of goods, net of trade discount and include ex- cise duty but exclude goods despatched pending for retirement where the titles of the goods remain with the company till retirement of documents. Other Incomes are recognized on accrual basis.

6. Earnings per share Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share- holders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the Period. The weighted average number of equity shares outstanding during the period is adjusted for events of bonus issue. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equ- ity shares that could have been issued upon conversion.

7. Fixed Assets All Fixed Assets are stated at cost less depreciation. Interest on borrowed funds attributable to acquisition of Fixed As- sets and revenue expenses incurred prior to installation are capitalised as part of assets cost. Own manufactured assets are capitalised at cost including est- imated overheads.

8. Research & Development Revenue expenditure on research and development is charged as expense in the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets.

9. Investments a) Investments are stated at Cost (FIFO basis). b) In respect of investment of a long- term nature (including in subsidi- aries), provision is made for any diminution in the value wherever it is permanent in nature.

10. Foreign Exchange Transactions Foreign currency transa- ctions are accounted at exchange rates prevailing on the date of transaction. Current Assets and Liabilities denom- inated in foreign currency as at the Balance Sheet date are reconverted at rates prevailing at the year-end and the resultant net gains or losses are adjusted in the Account.

11. Retirement Benefits Retirement benefits are dealt with in the following manner:

a) Contributions to Provident Fund are accounted on accrual basis with co- rresponding contribution to recog- nised funds for staff on actual duty.

b) Provision for Gratuity liability is made on the basis of actuarial val- uation, with corresponding contrib- ution to recognised fund for staff on actual duty.

12. Provisions, Contingent A provision is recognized when an ente- Liabilities rprise has a present obligation as a result of past event; and Contingent Assets it is probable that an outflow of resources will be required to settle the obligation, in respect ofwhich a reliable estimate can be made. Provi- sions are not discounted to its present value and are determined based on best estimate required to settle the oblig- ation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.Contingent liability is disclosed in the case of:

i) a present obligation from the past event when it is not probable that an outflow of resources will be required to settle the obligation;

ii) a possible obligation, unless the probability of outflow is remote; Contingent assets are not recognised in the financial statements.


Mar 31, 2013

1. Basis of Preparation of Financial Statements

The fnancial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on accrual basis, except in case of certain items of Income/Expenditure where recovery/payment is uncertain. GAAP comprises mandatory accounting standards as specifed in the Companies (Accounting Standards) Rules, 2006 and the provisions of the Companies Act, 1956. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

2. Use of estimates The preparation of fnancial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the fnancial statements and results of operations during the reported period end. Examples of such estimates includes provision for diminution in value of investments, provision for doubtful debts, future obligations under defned beneft obligations under employee retirement beneft plans, provision for income taxes and the useful lives of fxed and intangible assets. Although these estimates are based upon management''s best knowledge of current events and actions, actual result could differ from these estimates. Accordingly, estimated benefts against exports remaining to be utilised / liability for duty free raw materials excess utilised as at the end of the year has been accounted for in arriving at the consumption of raw materials.

3. Inventory Valuation (a) Raw Materials

(b) Goods-in-process (c) Finished Goods

At weighted average cost

Lower of Cost or net realisable value.

Lower of Cost or net realisable value.

(d) Stores, Spares Parts and Loose Tools

At weighted average cost.

(e) Scrap and Wastage At estimated selling price.

In respect of Finished goods and Goods in process, the cost is determined by considering material, related labour & overheads and duty thereon.

4. Depreciation Plant and Machinery on straight-line method and other Fixed Assets on reducing balance method at the rates specifed in Schedule XIV of the Companies Act, 1956. Plant and Machinery are depreciated to the extent of 95% of its gross value considering the shelf life of 18 years.

5. Sales/Other Incomes Sales comprise sale of goods, net of trade discount and include excise duty but exclude goods despatched pending for retirement where the titles of the goods remain with the company till retirement of documents.

Other Incomes are recognized on accrual basis.

6. Earnings per share Basic earnings per share are calculated by dividing the net proft or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the Period. The weighted average number of equity shares outstanding during the period is adjusted for events of bonus issue. For the purpose of calculating diluted earnings per share, the net proft or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares that could have been issued upon conversion.

7. Fixed Assets All Fixed Assets are stated at cost less depreciation. Interest on borrowed funds attributable to acquisition of Fixed Assets and revenue expenses incurred prior to installation are capitalised as part of assets cost. Own manufactured assets are capitalised at cost including estimated overheads.

8. Research & Development Revenue expenditure on research and development is charged as expense in the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fxed assets.

9. Investments Investments are stated at Cost (FIFO basis). In respect of investment of a long-term nature (including in subsidiaries), provision is made for any diminution in the value wherever it is permanent in nature.

10. Foreign Exchange Transactions Foreign currency transactions are accounted at exchange rates prevailing on the date of transaction.

Current Assets and Liabilities denominated in foreign currency as at the Balance Sheet date are reconverted at rates prevailing at the year-end and the resultant net gains or losses are adjusted in the Account.

11. Retirement Benefts Retirement benefts are dealt with in the following manner:

a) Contributions to Provident Fund are accounted on accrual basis with corresponding contribution to recognised funds for staff on actual duty.

b) Provision for Gratuity liability is made on the basis of actuarial valuation, with corresponding contribution to recognised fund for staff on actual duty.

12. Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized when an enterprise has a present obligation as a result of past event; it is probable that an outfow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to refect the current best estimates. Contingent liability is disclosed in the case of: i) a present obligation from the past event when it is not probable that an outfow of resources will be required to settle the obligation;

ii) a possible obligation, unless the probability of outfow is remote;


Sep 30, 2011

1. Method of Accounting

Company generally maintains its accounts on accrual basis, except in case of certain items of Income/Expenditure where recovery/payment is uncertain. Accordingly, estimated benefits against exports remaining to be utilised / liability for duty free raw materials excess utilised as at the end of the year has been accounted for in arriving at the consumption of raw materials.

2. Inventory Valuation

(a) Stores, Spares Parts and Loose Tools At weighted average cost.

(b) Raw Materials At weighted average cost.

(c) Finished Goods Lower of Cost or net realisable value.

(d) Goods-in-process Lower of Cost or net realisable value.

(e) Scrap and Wastage At estimated selling price.

In respect of Finished goods and Goods in process, the cost is determined by considering ' material, related labour & overheads and duty thereon.

3. Depreciation

Plant and Machinery on straight-line method and other Fixed Assets on reducing balance method at the rates specified in Schedule XIV of the Companies Act, 1956. Plant and Machinery are depreciated to the extent of 95% of its gross value considering the shelf life of 18 years.

4. Sales

Sales comprise sale of goods, net of trade discount and include excise duty but exclude goods dispatched pending for retirement where the titles of the goods remain with the company till retirement of documents.

5. Fixed Assets

All Fixed Assets are stated at cost less depreciation. Interest on borrowed funds attributable to acquisition of Fixed Assets and revenue expenses incurred prior to installation are capitalised as part of assets cost. Own manufactured assets are capitalised at cost including estimated overheads.

6. Research & Development

Revenue expenditure on research and development is charged as expense in the year in ' which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets.

7. Investments

Investments are stated at Cost. In respect of investment of a long-term nature (including in subsidiaries), provision is made for any diminution in the value wherever it is permanent in nature.

8. Foreign Exchange Transactions

Foreign currency transactions are accounted at exchange rates prevailing on the date of transaction. Current Assets and Liabilities denominated in foreign currency as at the Balance Sheet date are reconverted at rates prevailing at the year-end and the resultant net gains or losses are adjusted in the Account.

9. Retirement Benefits

Retirement benefits are dealt with in the following manner:

a) Contributions to Provident Fund are accounted on accrual basis with corresponding contribution to recognised funds for staff on actual duty.

b) Provision for Gratuity liability is made on the basis of actuarial valuation, with corresponding contribution to recognised fund for staff on actual duty.


Mar 31, 2010

1. Method of Accounting

Company generally maintains its accounts on accrual basis, except in case of certain items of Income/ Expenditure where recovery/payment is uncertain. Accordingly, estimated benefits against exports remaining to be utilised / liability for duty free raw materials excess utilised as at the end of the year has been accounted for in arriving at the consumption of raw materials.

2. Inventory Valuation

(a) Stores, Spares Parts and At weighted average cost.

Loose Tools

(b) Raw Materials At weighted average cost

(c) Finished Goods Lower of Cost or net realisable value.

(d) Goods-in-process Lower of Cost or net realisable value.

(e) Scrap and Wastage At estimated selling price.

In respect of Finished goods and Goods in process, the cost is determined by considering material,

related labour & overheads and duty thereon.

3. Depreciation

Plant and Machinery on straight-line method and other Fixed Assets on reducing balance method at the rates specified in Schedule XIV of the Companies Act, 1956. Plant and Machinery are depreciated to the extent of 95% of its gross value considering the shelf life of 18 years.

4. Sales

Sales comprise sale of goods, net of trade discount and include excise duty but exclude goods despatched pending for retirement where the titles of the goods remain with the company till retirement of documents.

5. Fixed Assets

All Fixed Assets are stated at cost less depreciation. Interest on borrowed funds attributable to acquisition of Fixed Assets and revenue expenses incurred prior to installation are capitalised as part of assets cost. Own manufactured assets are capitalised at cost including estimated overheads.

6. Research & Development

Revenue expenditure on research and development is charged as expense in the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets.

7. Investments

Investments are stated at Cost. In respect of investment of a long-term nature (including in subsidiaries), provision is made for any diminution in the value wherever it is permanent in nature.

8. Foreign Exchange Transactions

Foreign currency transactions are accounted at exchange rates prevailing on the date of transaction. Current Assets and Liabilities denominated rn foreign currency as at the Balance Sheet date are reconverted at rates prevailing at the year-end and the resultant net gains or losses are adjusted in the Account.

9. Retirement Benefits

Retirement benefits are dealt with in the following manner:

a) Contributions to Provident Fund are accounted on accrual basis with corresponding contribution to recognised funds for staff on actual duty.

b) Provision for Gratuity liability is made on the basis of actuarial valuation, with corresponding contribution to recognised fund. (No contribution from 1.10.2000).



 
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