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Novopan Industries Ltd. Accounting Policies | Accounting Policy of Novopan Industries Ltd.
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Accounting Policies of Novopan Industries Ltd. Company

Mar 31, 2014

A. Basis of preparation of Financial Statements:

The financial statements have been prepared to comply in all material respects with accounting principles generally accepted in India and the applicable Accounting Standards notified under Section 211(3C) [the Companies (Accounting Standards) Rules, 2006 (as amended)] and the relevant provisions of the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act 2013. The financial statements have been prepared under the historical cost convention on accrual basis.

All assets and liabilities have been classified as current or non-current as per the Company''s normal Operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the services rendered and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current and non- current classification of assets and liabilities.

b. Use of estimates

The preparation of financial statements in conformity with accounting principles generally . accepted in India requires management, where necessary, to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at 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.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised.

c. Exceptional and Extraordinary Items

(i) Exceptional Items: Items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the year, the nature and amount of such items are disclosed separately as exceptional items.

(ii) Extraordinary Items: Extraordinary items are income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and which are not expected to recur frequently or regularly.

d. Revenue Recognition:

The income from sale of goods is recognised as and when sales are made. Sales are inclusive of all Taxes, Duties and other charges and net of Trade Discounts and Rebates.

e. Fixed Assets:

Tangible fixed assets are stated at cost less accumulated depreciation and impairment loss..Cost of acquisition of fixed assets is inclusive of freight, net of duty/tax credits availed, if any, incidental expenses relating thereto and the cost of installation/erection. Financing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for intended use are also included to the extent they relate to the period upto such assets are ready for their intended use.

f. Depreciation:

Depreciation is provided on written down value method for Patancheru Unit and on Straight Line Method for Shadnagar and Resins units at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956.

g. Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists,, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

h. Inventories:

(i) Finished goods are stated at cost or realizable value whichever is less.

(ii) Work-in- process is stated at Cost.

(iii) Raw materials, Packing Material and Stores and Spares are stated at cost on Weighted Average method less provision for obselocense if any.

i. Foreign Exchange Fluctuation:

(i) Initial recognition: Transactions in foreign currencies are initially recorded at the exchange rates prevailing on the date of the transaction.

(ii) Translation: At the year end all monetary assets and liabilities in foreign currency are restated at the rate prevailing at the year end.

(iii) Exchange Differences: Any gain or loss on translation or settlement of transaction is recognised in the statement of profit and loss.

j. Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments.

Long term Investments are stated at cost. Provision is made for diminution in value of investments only if such decline is other than temporary.

k. Retirement Benefits:

(i) Periodical contributions made to concerned authorities towards Provident Fund and ESI are charged to revenue.

(ii) The workers of the company are eligible for leave encashment. At each reporting date, company''s liability towards leave encashment is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

(iii) Company recognizes the undiscounted amount of employee benefits like Leave Travel Assistance, during the accounting period based on eligibility of employee as per Company''s rules in this regard.

I. Borrowing Costs:

(i) Borrowing costs directly attributable to the acquisition, construction / erection of qualifying assets, construction / erection of an asset that necessarily takes a substantial period of time to get ready for its intended use are capitalized as part of the cost of the respective asset.

(ii) All other borrowing costs are charged to revenue as and when incurred.

m. Earnings per share

(i) Basic earnings per share: Basic earnings per share is calculated by dividing the net profit or loss for the year after tax attributable to equity share holders by weighted average number of equity shares outstanding during the year.

(ii) Diluted earnings per share: Diluted earnings per share is calculated by dividing the net profit or loss for the year after tax attributable to equity shareholders by the weighted average number of equity shares outstanding including equity shares which would have been issued on the conversion of all dilutive potential equity shares unless they are considered anti-dilutive in nature.

n. Taxes on Income

(i) Tax expense comprising of current and deferred tax, are considered in the determination of the net profit or loss for the year.

(ii) Current tax: Provision for current tax, estimated to arise on the profit for the year is made at the current rate of tax in accordance with the Income-tax Act, 1961.

(iil)Deferred Tax: In accordance with the Accounting Standard - 22, Accounting for taxes on income, the company recognises deferred tax liability in the accounts. Deferred tax reflects the impact of timing differences between taxable income and accounting income. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax asset is recognised only to the extent there is virtual certainty that sufficient taxable income will be available in future against which such deferred tax asset can be realised.

o. Provisions and Contingencies

Provision is recognised when the Company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted totheir 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 reflect the current best estimates.

Contingent liabilities are disclosed when there is a probable obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, and such liability that may arise is termed as. a contingent liability.

p. Insurance Claims:

Insurance claims are accounted for on admission by the authorities or on settlement.


Mar 31, 2013

A. Basis of preparation of Financial Statements:

The financial statements have been prepared to comply in all material respects with accounting principles generally accepted in India and the applicable Accounting Standards notified under Section 211(3C) [the Companies (Accounting Standards) Rules, 2006 (as amended)] and the provisions of the Companies Act, 1956 ("the Act"). The financial statements have been prepared under the historical cost convention on accrual basis.

All assets and liablities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the services rendered and their realization in cash and cash equaivalents, the Company has ascertained its operating cycle as 12 months for the purporse of current and non-current classification of assets and liabilities.

b. Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in India requires management, where necessary, to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at 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.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised.

c. Exceptional and Extraordinary Items

i) Exceptional Items: Items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the period, the nature and amount of such items are disclosed separately as exceptional items.

ii) Extraordinary Items: Extraordinary items are income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and, therefore, are not expected to recur frequently or regularly

d. Revenue Recognition:

The income from sale of goods is recognised as and when sales are made. Sales are inclusive of all Taxes, Duties and other charges and net of Trade Discounts and Rebates.

e. Fixed Assets:

Tangible fixed assets are stated at cost less accumulated depreciation and impairment loss. Cost of acquisition of fixed assets is inclusive of freight, net of duty/tax credits availed, if any, incidental expenses relating thereto and the cost of installation/erection. Financing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for intended use are also included to the extent they relate to the period upto such assets are ready for their intended use.

f. Depreciation:

Depreciation is provided on written down value method for Patancheru Unit and on Straight Line Method for Shadnagar and Resins units at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956.

g. Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

h. Inventories:

i) Finished goods are stated at cost or realizable value whichever is less.

ii) Work-in- process is stated at Cost.

iii) Raw materials, Packing Material and Stores and Spares are stated at cost on Weighted Average method.

i. Foreign Exchange Fluctuation:

i) Initial recognition: Transactions in foreign currencies are initially recorded at the exchange rates prevailing on the date of the transaction.

ii) Translation: At the year end all monetary assets and liabilities in foreign currency are restated at the rate prevailing at the year end.

iii) Exchange Differences: Any gain or loss on translation or settlement of transaction is recognised in the statement of profit and loss.

iv) Non-monetory assets and liabilities are translated at the rate prevailing on the date of Transaction.

j. Investments:

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments.

Long term Investments are stated at cost. Provision is made for diminution in value of investments only if such decline is other than temporary.

k. Retirement Benefits:

i) Periodical contributions made to concerned authorities towards Provident Fund and ESI are charged to revenue.

ii) Group Gratuity Scheme is administered through trustees for which policy is taken from LIC and Premiums will be paid to the said fund. At each reporting date, company''s liability towards gratuity is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

iii) The workers of the company are eligible for leave encashment. At each reporting date, company''s liability towards leave encashment is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

iv) Company recognizes the undiscounted amount of employee benefits like Leave Travel Assistance, during the accounting period based on eligibility of employee as per Company''s rules in this regard.

l. Borrowing Costs:

i) Borrowing costs directly attributable to the acquisition, construction / erection of qualifying assets, construction / erection of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset.

ii) All other borrowing costs are charged to revenue as and when incurred.

m. Earnings per share

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

ii) Diluted earnings per share: Diluted earnings per share is calculated by dividing the net profit or loss for the year after tax attributable to equity shareholders by the weighted average number of equity shares outstanding including equity shares which would have been issued on the conversion of all dilutive potential equity shares unless they are considered anti-dilutive in nature.

n. Taxes on Income

i) Tax expense comprising of current and deferred tax, are considered in the determination of the net profit or loss for the year.

ii) Current tax: Provision for current tax, estimated to arise on the profit for the year is made at the current rate of tax in accordance with the Income-tax Act, 1961.

iii) Deferred Tax: In accordance with the Accounting Standard - 22, Accounting for taxes on income, the company recognises the deferred tax liability in the accounts. Deferred tax reflects the impact of timing differences between taxable income and accounting income. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax asset is recognised only to the extent there is virtual certainty that sufficient taxable income will be available in future against which such deferred tax asset can be realised.

o. Provisions and Contingencies

Provision is recognised when the Company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their 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 reflect the current best estimates.

Contingent liabilities are disclosed when there is a probable obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, and such liability that may arise is termed as a contingent liability.

p. Insurance Claims:

Insurance claims are accounted for on admission by the authorities or on settlement.

q. Unamortized Expenses:

Expenditure on account of merger/amalgamation is written off over a period of 5 years.


Mar 31, 2012

A. Basis of preparation of Financial Statements:

The financial statements have been prepared to comply in all material respects with accounting principles generally accepted in India and the applicable Accounting Standards notified under Section 211(3C) [the Companies (Accounting Standards) Rules, 2006 (as amended)] and the provisions of the Companies Act, 1956 ("the Act"). The financial statements have been prepared under the historical cost convention on accrual basis.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the services rendered and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.

b. Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in India requires management, where necessary, to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at 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.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised.

c. Exceptional and Extraordinary Items

(i) Exceptional Items: Items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the period, the nature and amount of such items are disclosed separately as exceptional items.

(ii) Extraordinary Items: Extraordinary items are income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and, therefore, are not expected to recur frequently or regularly

d. Revenue Recognition:

The income from sale of goods is recognised as and when sales are made. Sales are inclusive of all Taxes, Duties and other charges and net of Trade Discounts and Rebates.

e. Fixed Assets:

Tangible fixed assets are stated at cost less accumulated depreciation and impairment loss. Cost of acquisition of fixed assets is inclusive of freight, net of duty/tax credits availed, if any, incidental expenses relating thereto and the cost of installation/erection. Financing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for intended use are also included to the extent they relate to the period upto such assets are ready for their intended use.

f. Depreciation:

Depreciation is provided on written down value method for Patancheru Unit and on Straight Line Method for Shadnagar and Resins units at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956.

g. Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

h. Inventories:

(i) Finished goods are stated at cost or realizable value whichever is less.

(ii) Work-in- process is stated at Cost.

(iii) Raw materials, Packing Material and Stores and Spares are stated at cost on Weighted Average method.

i. Foreign Exchange Fluctuation:

(i) Initial recognition: Transactions in foreign currencies are initially recorded at the exchange rates prevailing on the date of the transaction.

(ii) Translation: At the year end all monetary assets and liabilities In foreign currency are restated at the rate prevailing at the year end.

(iii) Exchange Differences: Any gain or loss on translation or settlement of transaction is recognised in the statement of profit and loss.

(iv) Non-monetary assets and liabilities are translated at the rate prevailing on the date of transaction.

j. Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments.

Long term Investments are stated at cost. Provision is made for diminution in value of investments only if such decline is other than temporary.

k. Retirement Benefits:

(i) Periodical contributions made to concerned authorities towards Provident Fund and ESI are charged to revenue.

(ii) Group Gratuity Scheme is administered through trustees for which policy is taken from L1C and Premiums will be paid to the said fund. At each reporting date, company's liability towards gratuity is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

(iii) The workers of the company are eligible for leave encashment. At each reporting date, company's liability towards leave encashment is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

(iv) Company recognizes the undiscounted amount of employee benefits like Leave Travel Assistance, during the accounting period based on eligibility of employee as per Company's rules in this regard.

l. Borrowing Costs:

(i) Borrowing costs directly attributable to the acquisition, construction/erection of qualifying assets, construction/erection of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset.

(ii) All other borrowing costs are charged to revenue as and when incurred.

m. Earnings per share

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

(ii) Diluted earnings per share: Diluted earnings per share is calculated by dividing the net profit or loss for the year after tax attributable to equity shareholders by the weighted average number of equity shares outstanding including equity shares which would have been issued on the conversion of all dilutive potential equity shares unless they are considered anti- dilutive in nature.

n. Taxes on Income

(i) Tax expense comprising of current and deferred tax, are considered in the determination of the net profit or loss for the year.

(ii) Current tax: Provision for current tax, estimated to arise on the profit for the year is made at the current rate of tax in accordance with the Income-tax Act, 1961.

(iii) Deferred Tax: In accordance with the Accounting Standard - 22, Accounting for taxes on income, the company has recognised the deferred tax liability in the accounts. Deferred tax reflects the.impact of timing differences between taxable income and accounting.income. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax asset is recognised only to the extent there is virtual certainty that sufficient taxable income will be available in future against which such deferred tax asset can be realised.

o. Provisions and Contingencies

Provision is recognised when the Company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their 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 reflect the current best estimates. Contingent liabilities are disclosed when there is a probable obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, and such liability that may arise is termed as a contingent liability.

p. Insurance Claims:

Insurance claims are accounted for on admission by the authorities or on settlement.

q. Unamortized Expenses:

Expenditure on account of merger/amalgamation is written off over a period of 5 years.


Mar 31, 2010

A. BASIS OF ACCOUNTING:

The financial statements are prepared under historical cost convention on accrual basis and in accordance with generally accepted accounting principles.

B. REVENUE RECOGNITION:

The income from sale is recognised as and when sales are made. Sales are inclusive of all TaRs.es, Duties and other charges and net of Trade Discounts and Rebates.

C. FIRs.ED ASSETS:

FiRs.ed Assets are stated at cost less accumulated depreciation. Cost of acquisition of fiRs.ed assets is inclusive of freight, net of duty/taRs. credits availed, if any, incidental eRs.penses relating thereto and the cost of installation/erection.

D. DEPRECIATION:

Depreciation is provided on written down value method for Patancheru Unit and on Straight Line Method for Shadnagar unit and Resin Units at the rates and in the manner specified in

Schedule Rs.IV of the Companies Act, 1956.

E. INVENTORIES.

(i) Finished goods are stated at cost or realizable value whichever is less.

(ii) Work-in- process is stated at Cost.

(iii) Raw materials, Packing Material and Stores and Spares are stated at cost on Weighted Average method.

F. RETIREMENT BENEFITS:

(i) Periodical contributions made to concerned authorities towards Provident Fund and ESI are charged to revenue.

(ii) Group Gratuity Scheme is administered through trustees for which policy is taken from LIC and Premiums will be paid to the said fund. At each reporting date, companys liability towards gratuity is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

(iii) The workers of the company are eligible for leave encashment. At each reporting date, companys liability towards leave encashment is determined by independent actuarial valuation using the projected unit credit method and is charged to revenue.

G. INSURANCE CLAIMS:

Insurance claims are accounted for on admission by the authorities or on settlement. H. Miscellaneous ERs.penditure:

ERs.penditure on account of merger/amalgamation is written off over a period of 5 years.

I. FOREIGN ERs.CHANGE FLUCTUATION:

(i) Foreign currency transaction will be accounted at the rate prevailing on the date of transaction and difference if any In the rate of eRs.change arising on the date of payment will be debited / credited to the revenue.

(ii) Assets and liabilities arising out of foreign eRs.change transactions are translated at the rates of eRs.change ruling on the date of Balance Sheet and are suitably adjusted to the revenue account.

(iii) Non-monetary assets and liabilities are translated at the rate prevailing on the date of transaction.

J. INVESTMENTS:

Long term Investments are stated at cost. Provision is made for diminution in value of investments only if such decline is other than temporary.

K. DEFERRED TARs.:

Deferred taRs., being taRs. on timing difference between taRs.able income and accounting income, that originate in one year and capable of reversal in one or more subsequent years, has been recognized.

Deferred taRs. asset is recognized only if there is reasonable certainty that it will be realized and will be reviewed for the appropriateness of Its respective carrying value at each balance sheet date.

L. CONTINGENT LIABILITIES:

Contingent liabilities are indicated by way of a note and will be paid / provided on crystalisatioh of the liability.

M. IMPAIRMENT OF ASSETS:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication eRs.ists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer eRs.ists, the recoverable amount is reassessed and the asset is, reflected at the recoverable amount subject to a maRs.imum of depreciated historical cost.

 
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