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Accounting Policies of Murli Industries Ltd. Company

Mar 31, 2014

A. Presentation & Disclosure of Financial Statements:

During the period of nine months ended 31st March, 2014, the Revised Schedule VI notified under The Companies Act, 1956 has been followed by the company for preparation and presentation of its financial statements. Assets & Liabilities have been classified as Current 7 Non-Current as per the companies normal operating cycle and other criteria set out in Schedule VI of The Companies Act, 1956.Based on the nature of the activity carried out and the period between the procurement and realization of cash & cash equivalents, the company has ascertained its operating cycle as 12 Months for the purpose of Current - non Current classification of assets & liabilities.

The Company has also reclassified/regrouped the previous year figures in accordance with the requirements applicable in the current period. The figures are not comparable because the previous year was of fifteen months and the current year is for nine months. The Company has not bifurcated its borrowings from banks and financial institutions in respect of the amounts which are already due for payment or due for payment within an year''s time and the same is being shown under the head Non Current Liabilities instead of Current Liabilities.

b. Accounting Convention:

The financial statements of the Company are prepared under the historical cost convention using accrual system of accounting with generally accepted accounting Principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the Provisions of The Companies Act 1956.

c. Use of Estimates:

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires the management to make estimates and assumptions that affect the reported balance of assets & liabilities as of the date of the financial statements and reported amounts of income and expenditure during the period. Management believes that the estimates used in the preparation of financial statements are prudent & reasonable.

d. Fixed Assets:

Fixed Assets have been stated at Cost less Accumulated Depreciation. The actual cost is inclusive of all the incidental cost of acquisition & installation expenses incurred till the asset is put to use. Assets are shown net of "CENVAT" claimed. The assets are not tested for impairment. Depreciation on Fixed Assets is provided, on pro rata basis, on Written Down Value Basis except in case of assets of SBS Board & Cement provided, on pro rata basis, on Written Down Value Basis except in case of assets of SBS Board & Cement Unit at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956.

e. Impairment of Assets:

The company does not have any policy of impairment of its assets.

f. Investments:

Investments are classified into Non Current & Current Investments.

Non-Current investments are carried at cost. Provision for diminution, if any in the value of each Non-Current investment is made to recognize a decline, other than of temporary nature.

Current Investments are carried individually at lower of cost and fair value and the resultant decline, if any, is charged to revenue.

g. Inventories:

Inventories comprise all cost of purchase, conversion and other costs incurred in bringing the inventory to their present location & condition.

Raw Materials and bought out components are valued at lower of cost or Net realizable Value. Cost is determined on the basis of the Average Method.

Finished goods produced and purchased for sale, manufactured are carried at cost or Net realizable value whichever is lower.

h. Retirement Benefits:

No provision has been made for Gratuity. However Gratuity is accounted for in the books as & when it is actually paid. The Company has not taken any kind of policy to provide for Retirement of employees. The Company does not follow AS-15 regarding provision for Employees benefits.

i. Provisions & Contingent Liabilities:

Provisions are recognized in the accounts in respect of present probable obligations, the amount of which can be reliably estimated.

Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company.

j. Earning Per Share:

Basic earnings per share is calculated by dividing net profit or loss after tax for the period attributable to equity shareholders by weighted average number of equity share outstanding during the period.

For the purpose of calculating diluted EPS, net profit or loss after tax for the period attributable to equity shareholder are divided by the weighted average number of equity shares outstanding during the period and are adjusted for the effects of all dilutive potential equity shares.

k. Revenue Recognition:

i. Sales are recognized on an accrual basis when all significant risks & rewards of ownership are transferred to the buyer and the company retains no effective control of goods transferred.

ii. Gross sales (net of returns) do not include excise duty, but the same is, wherever applicable. added back for complying with the disclosure requirements of Schedule VI.

iii. Other income is recognized on an accrual basis.

iv. Dividend income is recognized when the right to receive the dividend is established.

v. Interest income is recognized when no significant uncertainty as to its realization exists & is accounted on time proportion basis at contracted rates.

vi. Insurance and other miscellaneous claims are recognized on receipt/ acceptance of claims. Contractual pass though incentives, benefits, etc. are recognized on receipt basis.

vii. The income arising as per the Package Scheme of Incentives,2007 approved to the company, is recognised before the actual payment of the respective taxes.

l. Provision for Taxation:

Tax expense compromises both current.

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

MAT paid in accordance with the tax laws which give future economic benefit in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal income tax against which the Mat paid will be adjusted.

m. Borrowing Cost:

Borrowing cost directly attributable to the Acquisition, Construction or Production of qualifying assets is capitalized till the assets are ready to use. Other borrowing costs are recognized as an expense in the period in which these are incurred.

n. Segment Reporting:

* Identification of Segments

The company''s operating business are organized and managed separately according to the nature of products and services provided with each segment representating a strategic business unit that offers different products and serves different markets. The analysis of geographical segments is based on the areas in which major operating divisions of the company operate.

* Allocation of common costs

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

* Unallocated Items

Includes general corporate income and expense items which are not allocated to any business segment.

* Segment Policies

The company prepares its segment information in conformity with the accounting policies adopted for preparation and presenting the financial statements of the company as a whole.


Jun 30, 2013

A. Presentation & Disclosure of Financial Statements:

During the period of fifteen months ended 30th June, 2013, the Revised Schedule VI notified under The Companies Act, 1956 has been followed by the company for preparation and presentation of its financial statements. Assets & Liabilities have been classified as Current 7 Non-Current as per the companies normal operating cycle and other criteria set out in Schedule VI of The Companies Act, 1956.Based on the nature of the activity carried out and the period between the procurement and realization of cash & cash equivalents, the company has ascertained its operating cycle as 12 Months for the purpose of Current – non Current classification of assets & liabilities.

The Company has also reclassified/regrouped the previous year figures in accordance with the requirements applicable in the current period. The figures are not comparable because the previous year was of twelve months and the current year has been extended to fifteen months. The Company has not bifurcated its borrowings from banks and financial institutions in respect of the amounts which are already due for payment or due for payment within an year''s time and the same is being shown under the head Non Current Liabilities instead of Current Liabilities.

b. Accounting Convention:

The financial statements of the Company are prepared under the historical cost convention using accrual system of accounting with generally accepted accounting Principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the Provisions of The Companies Act 1956.

c. Use of Estimates:

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires the management to make estimates and assumptions that affect the reported balance of assets & liabilities as of the date of the financial statements and reported amounts of income and expenditure during the period. Management believes that the estimates used in the preparation of financial statements are prudent & reasonable.

d. Fixed Assets:

Fixed Assets have been stated at Cost less Accumulated Depreciation. The actual cost is inclusive of all the incidental cost of acquisition & installation expenses incurred till the asset is put to use. Assets are shown net of VCENVAT” claimed. The assets are not tested for impairment.Depreciation on Fixed Assets is provided, on pro rata basis, on Written Down Value Basis except in case of assets of SBS Board & Cement Unit at the rates and in the manner prescribed in Schedule XIV of the Companies Act, 1956.

e. Impairment of Assets:

The company does not have any policy of impairment of its assets.

f. Investments:

Investments are classified into Non Current & Current Investments.

Non-Current investments are carried at cost. Provision for diminution, if any in the value of each Non-Current Investment is made to recognize a decline, other than of temporary nature.

Current Investments are carried individually at lower of cost and fair value and the resultant decline, if any, is charged to revenue.

g. Inventories:

Inventories comprise all cost of purchase, conversion and other costs incurred in bringing the inventory to their present location & condition.

Raw Materials and bought out components are valued at lower of cost or Net realizable Value. Cost is determined on the basis of the Average Method.

Finished goods produced and purchased for sale, manufactured are carried at cost or Net realizable value whichever is lower.

h. Retirement Benefits:

No provision has been made for Gratuity. However Gratuity is accounted for in the books as & when it is actually paid.The Company has not taken any kind of policy to provide for Retirement of employees. The Company does not followAS-15 regarding provision for Employeesbenefits.

i. Pmvisions&ContingentLiabilities:

Provisions are recognized in the accounts in respect of present probable obligations, the amount ofwhich can be reliably estimated.

Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly ithin the control of the company.

j. EarningPerShare:

Basic earnings per share is calculated by dividing net profit or loss after tax for the year attributable to equity shareholders by weighted average number of equity share outstanding during the period.

For the purpose of calculating diluted EPS, net profit or loss after tax for the period attributable to equity shareholder are divided by the weighted average number of equity shares outstanding during the year and are adjusted for the effects of all dilutive potential equity shares.

k. Revenue Recognition:

i. Sales are recognized on an accrual basis when all significant risks & rewards of ownership are transferred to the buyer and the company retains no effective control of goods transferred. ii. Gross sales (net of returns) do not include excise duty, but the same is, wherever applicable, added back for complying with the disclosure requirements of Schedule VI. iii. Other income is recognized on an accrual basis. iv. Dividend income is recognized when the right to receive the dividend is established. v. Interest income is recognized when no significant uncertainty as to its realization exists & is accounted on time proportion basis at contracted rates. vi. Insurance and other miscellaneous claims are recognized on receipt/ acceptance of claims. Contractual pass though incentives, benefits, etc. are recognized on receipt basis.

l. Provision for Taxation:

Tax expense compromises both current & deferred tax.

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

Deferred tax assets & liabilities are recognized for future tax consequences attributable to the timing difference between taxable income & accounting income that are capable of reversal in one or more subsequent periods and are measured using tax rates enacted or substantively enacted as at the balance sheet date. Deferred tax assets are not recognized unless, in the management judgment, there is a virtual certainty that sufficient future taxable income will be available against which such differed tax asset may be realized. The carrying amount of deferred tax is reviewed at each balance sheet date.

MAT paid in accordance with the tax laws which give future economic benefit in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal income tax against which the MAT paid will be adjusted.

m. Borrowing Cost:

Borrowing cost directly attributable to the Acquisition, Construction or Production of qualifying assets is capitalized till the assets are ready to use. Other borrowing costs are recognized as an expense in the period in which these are incurred.


Mar 31, 2011

The accounts are prepared in accordance with the accounting principles generally accepted in India and are in line with the relevant laws as well as the guidelines prescribed by the Department of Company Affairs, Ministry of Law, Justice and Company Affairs and the Institute of Chartered Accountants of India.

1. SYSTEM OF ACCOUNTING : The financial statements of the Company are prepared under the historical cost convention using accrual system of accounting with generally accepted accounting Principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the Provisions of The Companies Act 1956.

2. FIXED ASSETS : Fixed Assets have been stated at Cost. The actual cost is inclusive of all the incidental cost of acquisition & installation expenses incurred till the asset is put to use. Assets are shown net of "CENVAT" claimed.

3. DEPRECIATION : Depreciation on the Fixed Assets has been provided on Written down Value Method in case of all units except SBS Board & Cement Unit where the depreciation has been provided on Straight Line Method. The rates as provided under Schedule XIV to the Companies Act, 1956 are applied. Depreciation on additions to the Fixed Assets made during the year is provided on a pro-rata basis from the date when asset is put to use. During the year, the method of charging depreciation has been changed from Written down Value method to Straight Line Method in SBS Board & Cement Unit. The accounting of the same has been done as per the provisions of Accounting Standard 6 issued by The Institute of Chartered Accountants of India. As informed to us, the same has been done so as to give a better presentation of financial statements as per the requirement of Accounting Standard -1. The same has resulted in increase in profit by Rs. 5.57 crores.

4. BORROWING COST : Borrowing cost directly attributable to the Acquisition, Construction or Production of qualifying assets is capitalized till the assets are ready to use. Other borrowing costs are recognized as an expense in the period in which these are incurred.

5. INVESTMENTS : Long term Investments are stated at cost. Short term investment are stated at lower of cost or market value.

6. INVENTORY : Inventories are valued at lower of cost or net realizable value. Finished Goods are valued on Net Realizable Value. By-Products are valued at net realizable value. The quantity and value of the same has been certified by the management.

7. REVENUE RECOGNITION : Revenue is recognized on passing of reasonable risks and rewards of goods to the buyer.

8. MODVAT/CENVAT : MODVAT/CENVAT benefit is accounted for by reducing the actual cost of the respective raw materials / fixed assets/ stores.

9. RETIREMENT BENEFITS : No provision has been made for Gratuity. However Gratuity is accounted for in the books as & when it is actually paid. The Company has not taken any kind of policy to provide for Retirement of Employees. The Company does not follow AS-15 regarding 'Provision for Retirement of Employees'.

10. INCOME TAX : The Company does not have taxable income as per income tax act and hence company has not made any provision for payment of income tax.

11. WEALTH TAX : The Company has not made any provision for payment of wealth tax.


Mar 31, 2010

The accounts are prepared in accordance with the accounting principles generally accepted in India and are in line with the relevant laws as well as the guidelines prescribed by the Department of Company Affairs, Ministry of Law, Justice and Company- Affairs and the Institute of Chartered Accountants of India.

1. SYSTEM OF ACCOUNTING : The financial statements of the Company are prepared under the historical cost convention using accrual system of accounting with generally accepted Accounting Principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the Provisions of The Companies Act, 1956.

2. FIXED ASSETS : Fixed Assets have been stated at Cost. The actual cost is inclusive of all the incidental cost of acquisition & installation expenses incurred till the asset is put to use. Assets are shown net of "CENVAT" claimed.

3. DEPRECIATION : Depreciation on the Fixed Assets has been provided on Written Down Value Method. The rates as provided under Schedule XIV to the Companies Act, 1956 are applied. Depreciation on additions to the Fixed Assets made during the year is provided on a pro-rata basis from the date when asset is put to use.

4. BORROWING COST : Borrowing cost directly attributable to the Acquisition, Construction or Production of qualifying assets is capitalized till the assets are ready to be used. Other borrowing costs are recognized as an expense in the period in which these are incurred.

5. INVESTMENTS : Long term Investments are stated at cost. Short term investment are stated at lower of cost or market value

6. INVENTORY : Inventories are valued at lower of cost or net realizable value. Finished Goods costs include packing expenses and conversion cost. By-products are valued at net realizable value.

7. REVENUE RECOGNITION : Revenue is recognized on passing of reasonable risks and rewards of goods to the buyer.

8. MODVAT/CENVAT : MODVAT/CENVAT benefit is accounted for by reducing the actual cost of the respective raw materials / fixed assets/stores.

9. RETIREMENT BENEFITS : No provision has been made for Gratuity. However Gratuity is accounted for in the books as & when it is actually paid. The Company has not taken any kind of policy to provide for Retirement of Employees. The Company does not followAS-15 regarding Provision for Retirement of Employees

10. INCOME TAX : The Company has provided for Income Tax liability on estimated Taxable income for the current accounting period & in accordance with the Provisions of Income Tax Act, 1961.

11. WEALTH TAX : As the Company does not have taxable wealth, as per Wealth Tax Act, the Company has not made any provision for payment of wealth tax.

 
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