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Accounting Policies of Monsanto India Ltd. Company

Mar 31, 2014

(A) Basis of preparation of financial statements:

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 notified under Section 211(3C) of the Companies Act, 1956 (Accounting Standards) Rules, 2006 (as amended) ("the 1956 Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 ("the 2013 Act") in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs) and the relevant provisions of the 1956 Act/ 2013 Companies Act, as applicable. The financial statements 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 financial statements in conformity with 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and differences between actual results and estimates are recognized in the periods in which the results are known / materialize.

(C) Tangible Fixed Assets and Depreciation

Fixed Assets are valued at their historical cost of acquisition or construction less accumulated depreciation. Cost includes all costs incurred to bring the assets to their present location and condition.

Depreciation on Tangible Fixed Assets is provided for on straight line basis in accordance with Section 205 (2) (b) of the Companies Act, 1956 (the Act) as follows:

(i) On fixed assets (except as stated below), at the rates specified in Schedule XIV to the Act.

(ii) Field vehicles are depreciated at the rate of 20%.

(iii) Plant and Machinery other than dryer is depreciated at the rate of 10%. Dryer is depreciated at the rate of 5%.

(iv) Mobile phones have been depreciated at the rate of 33.33%

(v) Leasehold improvements are amortised over the unexpired primary period of lease.

(vi) Factory Buildings are depreciated at the rate of 5%.

(vii) Computers are depreciated at the rate of 25%.

(D) Intangible Assets and Amortisation

Intangible Assets are valued at their cost less accumulated amortisation. Cost includes all costs incurred to bring the assets to their present location and condition.

(E) Impairment

An asset is considered as impaired in accordance with Accounting Standard 28 on Impairment of Assets when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exceeds its recoverable amount (i.e. the higher of the asset''s net selling price and value in use). The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the statement of profit and loss.

(F) Investments:

Current investments are stated at the lower of cost and fair value.

(G) Inventories:

Inventories are measured at the lower of cost and net realizable value, after providing for obsolescence. Costs of inventories comprise all costs of purchase – net of CENVAT, costs of inputs for standing crops, cost of conversion and other costs incurred in bringing the inventory to their present location and condition. Cost of Raw Materials, Packing Materials and finished goods (Traded Goods) are determined on weighted average cost basis. Cost of Work in Progress and Finished Goods (manufactured) are determined by the absorption costing method.

(H) Revenue Recognition:

(i) Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection. Revenue on sale of products is recognised on delivery of the products, when all significant contractual obligations have been satisfied, the property in the goods is transferred for a price, significant risks and rewards of ownership have been transferred and no effective ownership control is retained.

Sales are stated inclusive of excise duty and net of returns, trade discounts and sales tax recovered. The amount of excise duty that is included in the amount of turnover (gross) is presented as a reduction from gross.

(ii) Interest income is recognized on a time proportion basis.

(I) Foreign Currency Transactions:

Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction or at rates that closely approximate the rate at the date of the transaction. Monetary items denominated in foreign currency are restated using the exchange rates prevailing at the date of the balance sheet. Exchange differences arising on settlement or restatement are recognized in the statement of profit and loss.

(J) Employee Benefits:

(i) Provident fund is a defined contribution scheme and the contributions as required by the statute made to Government Provident Fund are charged to the statement of profit and loss.

(ii) Superannuation fund is a defined contribution scheme. The Company contributes a sum equivalent to 15% of eligible employees salary to Superannuation Fund administered by Trustees and managed by a life insurance Company. The Company recognizes such contribution as an expense when incurred.

(iii) The Company participates in a group gratuity cum life insurance scheme administered by the Birla Sun Life Insurance Company Ltd. Being a defined benefit plan, annual contributions made to the scheme are as per the intimations received from the Birla Sun Life Insurance Company Ltd. The Company accounts for liability for future gratuity benefits based

on an actuarial valuation conducted by an independent actuary. The net present value of the Company''s obligation is determined based on the projected unit credit method as at the Balance Sheet date. Additionally shortfall if any, between the balance in the fund with Tata AIG Life Insurance Company Ltd. and actuarial valuation obtained from an independent actuary is charged to the statement of profit and loss.

(iv) The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by an employee is recognized during the period when the employee renders the service.

(v) The liability for compensated absences is another long term benefit and is wholly unfunded. The liability for number of days of unutilized leave at each Balance Sheet date is provided for based on an independent actuarial valuation.

(vi) The actuarial gains and losses are recognized immediately in the statement of profit and loss.

(K) Earnings per Share:

The Company reports Earnings per Share (EPS) in accordance with Accounting Standard 20 on Earnings per Share. Basic EPS is computed by dividing the net profit for the year by the weighted average number of equity shares outstanding during the year.

(L) Taxation:

Income tax is accounted for in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Taxes comprise both current and deferred tax.

Current tax is measured at the amount expected to be paid to the taxation authorities, using the applicable tax rates and tax laws.

The tax effect of the timing differences that result between taxable income and accounting income and are capable of reversal in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. They are measured using the substantively enacted tax rates and tax regulations. The carrying amount of deferred tax assets at each balance sheet date is reduced to the extent that it is no longer reasonably certain that sufficient future taxable income will be available against which the deferred tax asset can be realized.

(M) operating Lease:

Operating lease payments are recognized as expenditure in the statement of profit and loss on a straightline basis, which is representative of the time pattern of benefits received from the use of assets taken on lease.

(N) Provisions, Contingent Liabilities and Contingent Assets:

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

(o) Cash Flow Statement:

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard – 3 on Cash Flow Statement and presents cash flows by operating, investing and financing activities of the Company. Cash and cash equivalents presented in the cash flow statement consist of cash on hand and balances in current and demand deposits with banks.


Mar 31, 2013

(A) Basis of preparation of financial statements:

The accompanying financial statements have been prepared under the historical cost convention, in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the 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 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and differences between actual results and estimates are recognized in the periods in which the results are known / materialize.

(C) Tangible Fixed Assets and Depreciation

Fixed Assets are valued at their historical cost of acquisition or construction less accumulated depreciation. Cost includes all costs incurred to bring the assets to their present location and condition.

Depreciation on Tangible Fixed Assets is provided for on straight line basis in accordance with Section 205 (2) (b) of the Companies Act, 1956 (the Act) as follows:

(i) On fixed assets (except as stated below), at the rates specified in Schedule XIV to the Act.

(ii) Field vehicles are depreciated at the rate of 20%.

(iii) Plant and Machinery other than dryer is depreciated at the rate of 10%. Dryer is depreciated at the rate of 5%.

(iv) Mobile phones have been depreciated at the rate of 33.33%

(v) Leasehold improvements are amortised over the unexpired primary period of lease.

(vi) Factory Buildings are depreciated at the rate of 5%.

(vii) Computers are depreciated at the rate of 25%.

(D) Intangible Assets and Amortisation

Intangible Assets are valued at their cost less accumulated amortisation. Cost includes all costs incurred to bring the assets to their present location and condition.

Intellectual Property Rights are amortised on a Straight Line basis over its useful life which is estimated by the management to be 5 years.

Computer Software is amortised on a Straight Line basis over its useful life which is estimated by the management to be upto 6 years.

(E) Impairment

An asset is considered as impaired in accordance with Accounting Standard 28 on Impairment ofAssets when at balance sheet date there are indications of impairment and the carrying amount ofthe asset, or where applicable the cash generating unit to which the asset belongs, exceeds its recoverable amount (i.e. the higher ofthe asset''s net selling price and value in use). In assessing the value in use, the estimated future cash flow expected from the continuing use of the asset and its ultimate disposal are discounted to their present value using a predetermined discount rate. The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the statement of profit and loss.

(F) Investments:

Current investments are stated at the lower of cost and fair value.

(G) Inventories:

Inventories are measured at the lower of cost and net realizable value, after providing for obsolescence.

Costs of inventories comprise all costs of purchase - net of CENVAT, costs of inputs for standing crops, cost of conversion and other costs incurred in bringing the inventory to their present location and condition. Cost of Raw Materials, Packing Materials and finished goods (Traded Goods) are determined on weighted average cost basis. Cost of Work in Progress and Finished Goods (manufactured) are determined by the absorption costing method.

(H) Revenue Recognition:

(i) Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection. Revenue on sale of products is recognised on delivery of the products, when all significant contractual obligations have been satisfied, the property in the goods is transferred for a price, significant risks and rewards ofownership have been transferred and no effective ownership control is retained.

Sales are stated inclusive of excise duty and net of returns, trade discounts and sales tax recovered. The amount of excise duty that is included in the amount of turnover (gross) is presented as a reduction from gross sales in accordance with the Accounting Standard (AS) - 9 "Revenue Recognition".

(ii) Revenue in respect of royalty, commission, etc. is recognized in accordance with contractual obligations.

(iii) Interest income is recognized on a time proportion basis.

(I) Foreign Currency Transactions:

(i) Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction or at rates that closely approximate the rate at the date ofthe transaction. Exchange differences arising on settlement of revenue transactions are recognized in the statement of profit and loss.

(ii) Monetary items denominated in foreign currency are restated using the exchange rates prevailing at the date of the balance sheet. Gains / Losses arising on restatement and on settlement of such liabilities are recognized in the statement of profit and loss.

(J) Employee Benefits:

(i) Provident fund is a defined contribution scheme and the contributions as required by the statute made to Government Provident Fund are charged to the statement of profit and loss.

(ii) Superannuation fund is a defined contribution scheme. The Company contributes a sum equivalent to 15% of eligible employees salary to Superannuation Fund administered by Trustees and managed by a life insurance Company. The Company recognizes such contribution as an expense as and when incurred.

(iii) The Company participates in a group gratuity cum life insurance scheme administered by the TATA AIG Life Insurance Company Ltd. Being a defined benefit plan, annual contributions made to the scheme are as per the intimations received from the TATA AIG Life Insurance Company Ltd. The Company accounts for liability for future gratuity benefits based on an actuarial valuation conducted by an independent actuary. The net present value of the Company''s obligation is determined based on the projected unit credit method as at the Balance Sheet date. Additionally shortfall, if any, between the balance in the fund with Tata AIG Life Insurance Company Ltd. and actuarial valuation obtained from an independent actuary is charged to the statement of profit and loss.

(iv) The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by an employee is recognized during the period when the employee renders the service. These benefits include performance incentives and non vesting accumulated compensated absences.

(v) The liability for compensated absences is another long term benefit and is wholly unfunded. The liability for number of days of unutilized leave at each Balance Sheet date is provided for based on an independent actuarial valuation.

(vi) The actuarial gains and losses are recognized immediately in the statement of profit and loss.

(K) Earnings per Share:

The Company reports Earnings per Share (EPS) in accordance with Accounting Standard 20 on Earnings per Share. Basic EPS is computed by dividing the net profit for the year by the weighted average number of equity shares outstanding during the year.

(L) Taxation:

Income tax is accounted for in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Taxes comprise both current and deferred tax.

Current tax is measured at the amount expected to be paid to the taxation authorities, using the applicable tax rates and tax laws.

The tax effect ofthe timing differences that result between taxable income and accounting income and are capable of reversal in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. They are measured using the substantively enacted tax rates and tax regulations. The carrying amount of deferred tax assets at each balance sheet date is reduced to the extent that it is no longer reasonably certain that sufficient future taxable income will be available against which the deferred tax asset can be realized.

(M) Operating Lease:

Operating lease payments are recognized as expenditure in the statement of profit and loss on a straight-line basis, which is representative of the time pattern of benefits received from the use of assets taken on lease.

(N) Provisions, Contingent Liabilities and Contingent Assets:

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

(O) Cash Flow Statement:

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard - 3 on Cash Flow Statement and presents cash flows by operating, investing and financing activities of the Company. Cash and cash equivalents presented in the cash flow statement consist of cash on hand and balances in current and demand deposits with banks.


Mar 31, 2011

(A) Basis of preparation of financial statements:

The accompanying financial statements have been prepared under the historical cost convention, in accordance with Indian Generally Accepted Accounting Principles and as per the provisions of the Companies Act, 1956.

(B) Use of estimates:

The preparation of financial statements in conf ormity with 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and dif ferences between actual results and estimates are recognized in the periods in which the results are known/materialize.

(C) Tangible Fixed Assets and Depreciation

Fixed Assets are valued at their historical cost of acquisition or construction less accumulated depr eciation. Cost includes all costs incurred to bring the assets to their present location and condition.

Depreciation on Tangible Fixed Assets is provided for on straight line basis in accordance with Section 205 (2) (b) of the Companies Act, 1956 (the Act) as follows:

(i) On fixed assets (except as stated below), at the rates specified in Schedule XIV to the Act.

(ii) Field vehicles are depreciated at the rate of 20%.

(iii) Plant and Machinery other than dryer is depreciated at the rate of 10%. Dryer is depreciated at the rate of 5%.

(iv) Mobile phones (Blackberry) have been depreciated at the rate of 33.33%

(v) Leasehold improvements are amortized over the unexpired period of lease.

(vi) Factory Buildings are depreciated at the rate of 5%.

(D) Intangible Assets and Amortization

Intangible Assets are valued at their cost less accumulated amortization. Cost includes all costs incurred to bring the assets to their present location and condition.

Intellectual Property Rights are amortized on a Straight Line basis over its useful life which is estimated by the management to be 5 years.

Computer Software is amortized on a Straight Line basis over its useful life which is estimated by the management to be 6 years.

(E) Impairment

An asset is considered as impaired in accordance with Accounting Standard 28 on Impairment of Assets when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exceeds its recoverable amount (i.e. the higher of the asset's net selling price and value in use). In assessing the value in use, the estimated future cash flow expected from the continuing use of the asset and its ultimate disposal are discounted to their present value using a predetermined discount rate. The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the profit and loss account.

(F) Investments:

Current investments are stated at the lower of cost and fair value.

(G) Inventories:

Inventories are measured at the lower of cost and net realizable value.

Costs of inventories comprise all costs of pur chase - net of CENVAT, costs of inputs f or standing crops, cost of conversion and other costs incurred in bringing the inventory to their present location and condition. Cost of Raw Materials, Packing Materials and finished goods (T raded Goods) are determined on FIF O basis. Cost of Work in Process and Finished Goods (manufactured) are determined by the absorption costing method.

(H) Revenue Recognition:

(i) Revenue is recognized when it is earned and no significantuncertainty exists as to its realization or collection. Revenue on sale of pr oducts is r ecognized on deliv ery of the pr oducts, when all significant contr actual obligations have been satisfied, the pr operty in the goods is tr ansferred for a price, significant risks and rewards of ownership have been transferred and no effective ownership control is retained.

Sales are stated inclusive of excise duty and net of r eturns, trade discounts and sales tax r ecovered. The amount of excise duty that is included in the amount of turno ver (gross) is presented as a reduction from gross sales in accordance with the A ccounting Standard interpretation ASI 14 ªDisclosure of revenue from sales transactionsº.

(ii) Revenue in respect of royalty, commission, etc. is recognized in accordance with contractual obligations.

(iii) Interest income is recognized on a time proportion basis.

(I) Foreign Currency Transactions:

(i) Transactions in foreign currency are recorded at the average monthly exchange rates, during the months in which the transactions are effected.

(ii) Exchange differences arising on set tlement of r evenue transactions are recognized in the Pr ofit & L oss Account.

(iii) Monetary items denominated in f oreign currency are restated using the exchange rates prevailing at the date of the balance sheet . Gains/losses arisin g on r estatement and on set tlement of such liabilities ar e recognized in the profit and loss account.

(J) Employee Benefits:

(i) Provident fund is a defined contribution scheme and the contributions as r equired by the statute made to Government Provident Fund are charged to profit and loss account.

(ii) Superannuation fund is a defined contribution scheme . The Company contributes a sum equivalent to 15% of eligible employees salary to Superannuation Fund administered by trustees and managed by life insured company. The Company recognizes such contribution as an expense as and when incurred.

(iii) The Company participates in a group gratuity cum life insurance scheme administered by the TATA AIG Life Insurance Company Ltd. Being a defined benefit plan, annual contributions made to the scheme ar e as per the intimations received from the TATA AIG Life Insurance Company Ltd. The Company accounts for liability for future gratuity benefits based on an actuarial v aluation conducted by an independent actuar y. The net present value of the C ompany's obligation is determined based on the pr ojected unit credit method as at the Balance Sheet date . Additionally shortfall, if any, between the balance in the fund with T ata AIG Life Insurance Company Ltd. and actuarial v aluation obtained from an independent actuar y is charged to the profit and loss account.

(iv) The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by emplo yee is r ecognized during the period when the emplo yee renders the ser vice. These benefits include performance incentives and non vesting accumulated compensated absences.

(v) The liability for compensated absences is an other lon g term benefit and is wholly unfunded. The liabilit y for number of days of unutilized leave at each Balance Sheet date is provided for based on an independent actuarial valuation.

(vi) The actuarial gains and losses are recognized immediately in the statement of Profit and Loss Account.

(K) Earnings Per Share:

The Company reports Earnings Per Share (EPS) in accordance with Accounting Standard 20 on Earnings Per Share. Basic EPS is computed by dividin g the net profit for the year by the weighted a verage number of equit y shares outstanding during the year.

(L) Taxation:

Income tax is accounted for in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Taxes comprise both current and deferred tax.

Current tax is measured at the amount expected to be paid to (recovered from) the taxation authorities, using the applicable tax rates and tax laws.

The tax effect of the timing differences that result between taxable income and accounting income and are capable of reversal in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. They are measured using the substantively enacted tax rates and tax regulations. The carrying amount of deferred tax assets at each balance sheet date is r educed to the extent that it is no lon ger reasonably certain that sufficient future taxable income will be available against which the deferred tax asset can be realized.

(M) Operating Lease:

Operating lease payments are recognized as expenditure in the profit and loss account on a str aight-line basis, which is representative of the time pattern of benefits received from the use of assets taken on lease.

(N) Provisions, Contingent Liabilities and Contingent Assets:

Provisions involving a substantial degree of estimation in measur ement are recognized when there is a present obligation as a r esult of past ev ents and it is pr obable that there will be an out flow of resources. Contingent liabilities are not recognized but are disclosed in the financial statements. Contingent assets are neither recognized nor disclosed in the financial statements.

(O) Cash Flow Statement:

The Cash Flow Statement is pr epared by the indir ect method set out in A ccounting Standard- 3 on Cash Flow Statement and presents cash flows by operating, investing and financing activities of the Company. Cash and cash equivalents presented in the cash flow statement c onsist of cash on hand and balances in curr ent and demand deposits with banks.

 
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