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Accounting Policies of Paramount Printpackaging Ltd. Company

Mar 31, 2014

A) Basis of preparation of financial statements

These financial statements have been prepared in accordance with generally accepted accounting principles in India under the historical cost convention on an accrual basis. Pursuant to circular 15/2013 dated September 13, 2013 read with circular 08/2014 dated April 4, 2014, till the standards of accounting or any addendum there to are prescribed by Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing accounting standard notified under the Companies Act, 1956 shall continue to apply. Consequently these financial statements have been prepared to comply in all material respects with the accounting standards notified under Section 211(3C) [Companies (Accounting Standards) Rules, 2006, as amended] and the other relevant provisions of the Companies Act, 1956 (the ‘Act’).

b) Use of estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of the contingent liabilities as at the date of the financial statements and the amount of income and expenses during the period reported under the financial statement. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.

c) Revenue Recognition

Revenue is recognized to the extent it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(i) Sale of products are recognized on transfer of all significant risks and rewards of ownership of the goods on to the buyer, which is generally on dispatch of goods.

(ii) Service income is recognized, when the related services are provided.

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

(iv) Dividends are recorded when the right to receive payment is established.

d) Fixed Assets

Fixed assets are stated at cost less accumulated depreciation and accumulated impairment loss (if any). The cost of a fixed asset comprises its purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

e) Depreciation

Depreciation on fixed assets has been provided in a manner that amortizes the cost of the assets over their estimated useful lives as detailed below:

(i) On a straight-line method at the rates determined in the year of acquisition under section 205 (b) of the Companies Act, 1956 on single shift basis except in case of plant & machinery and Electrical installation, where depreciation has been provided on triple shift basis.

(ii) Leasehold land has not been amortized over the primary year of the lease.

f) Intangible Assets

Intangible assets are stated at costs less accumulated depreciation. Intangible Assets (Computer Software) is amortized over a period of 5 years on straight line method.

g) Impairment Policy:

At each balance sheet date, the management reviews, the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset''s or CGU''s net selling price or its value in use. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

Reversal of impairment loss (if any), is recognised immediately as income in the statement of profit and loss.

h) Inventories

(i) Raw materials are valued at cost derived on average cost basis or net realizable value whichever is lower

(ii) Finished goods are stated at average material consumption cost and direct attributable overheads or Net realizable value whichever is lower.

(iii) Semi Finished Goods are valued at cost on the basis of process completion.

i) Foreign Currency Transactions

(i) Initial Recognition: A foreign currency transaction is recorded, on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion: At the year end, monetary items denominated in foreign currencies are converted into rupee equivalents at the year-end exchange rates.

(iii) Exchange Differences: All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

j) Investments

(i) Long-term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary.

(ii) Current investments are carried at lower of cost and fair value determined on an individual investment basis.

k) Employee Benefits

(i) Short term employee benefits:

Short term employee''s benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related services are renders. These benefits include compensated absences such as annual leave encashment and bonus.

(ii) Long term employees Benefits:

A. Provident fund, family Pension fund & employees'' State Insurance Scheme:

As per the employees'' Provident funds and miscellaneous Provisions Act, 1952, all employees of the company are entitled to receive benefits under the provident fund and family pension fund, which is a defined contribution plan. These contributions are made to the fund administrated and managed by Government of India. In addition, some employees of the company are covered under employees'' State Insurance Scheme act, 1948, which are also defined contribution schemes recognized and administrated by Government of India

The company''s contributions to these schemes are recognized as expense in the statement of profit and loss during the year in which the employee renders the related service. The company has no further obligation under these plans beyond its monthly contributions.

B. Gratuity:

The liabilities is a defined benefit obligation and the present value of the obligation under defined benefits plan is determined based on actuarial valuation using the Project Unit Credit method, which recognizes each year of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up final obligation. The obligation is measured at the present value of the estimated cash flows. The discount rate used for determining the present value of the defined obligation under defined benefit plan, is based on the market yields on Government securities as at the balance sheet date. Actuarial gains and losses are recognized in the statement of Profit and Loss as and when determined.

l) Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets, upto the date the asset is put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

m) Leases

Leases wherein a significant portion of the risks and reward of ownership are retained by the lessor are classified as Operating Leases. Lease rentals in respect of such leases are charged to the Profit and Loss Account.

n) Earnings per share

Basic earnings per share

For the purpose of calculating basic earnings per share, the net profit or loss for the period attributable to equity shareholders after deducting preference dividends (if any) and any attributable tax thereto for the period is divided by weighted number of equity shares outstanding during the period.

Diluted earnings per share

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 equity shares.

o) Taxes on Income

(i) Current income tax is determined on the basis of taxable income after considering the various deductions available under The Income Tax Act, 1961.

(ii) Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

However in case of unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only to the extent that there is virtual certainty that sufficient future taxable income will be available to realise such assets. Such assets are reviewed at each balance sheet date to reassess its realisations.

(iii) Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period.

p) Provisions

A Provision is recognized when the Company has a present obligation as a result of a 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 reviewed at each balance sheet date and adjusted to reflect the current management estimates.

Contingent liabilities are disclosed by way of note to the Financial Statements after careful evaluation by the proprietor of facts and legal aspects of the matter involved.

Contingent Assets are neither recognized nor disclosed.


Mar 31, 2013

A) Basis of preparation of financial statements

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

b) Use of estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of the contingent liabilities as at the date of the financial statements and the amount of income and expenses during the period reported under the financial statement. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.

c) Revenue Recognition

Revenue is recognized to the extent it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(i) Sale of products are recognized on transfer of all significant risks and rewards of ownership of the goods on to the buyer, which is generally on dispatch of goods.

(ii) Service income is recognized, when the related services are provided.

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

(iv) Dividends are recorded when the right to receive payment is established.

d) Fixed Assets

Fixed assets are stated at cost less accumulated depreciation and accumulated impairment loss (if any). The cost of a fixed asset comprises its purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

e) Depreciation

Depreciation on fixed assets has been provided in a manner that amortizes the cost of the assets over their estimated useful lives as detailed below:

(i) On a straight-line method at the rates determined in the year of acquisition under section 205 (b) of the Companies Act, 1956 on single shift basis except in case of plant & machinery and Electrical installation, where depreciation has been provided on triple shift basis.

(ii) Leasehold land has not been amortized over the primary year of the lease.

f) Intangible Assets

Intangible assets are stated at costs less accumulated depreciation.

Intangible Assets (Computer Software) is amortized over a period of 5 years on straight line method.

g) Impairment Policy:

At each balance sheet date, the management reviews, the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset''s or CGU''s net selling price or its value in use. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

Reversal of impairment loss (if any), is recognised immediately as income in the statement of profit and loss.

h) Inventories

(i) Raw materials are valued at cost derived on average cost basis or net realizable value whichever is lower

(ii) Finished goods are stated at average material consumption cost and direct attributable overheads or Net realizable value whichever is lower.

(iii) Semi Finished Goods are valued at cost on the basis of process completion.

i) Foreign Currency Transactions

(i) Initial Recognition: A foreign currency transaction is recorded, on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion: At the year end, monetary items denominated in foreign currencies are converted into rupee equivalents at the year-end exchange rates.

(iii) Exchange Differences: All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

j) Investments

(i) Long-term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary.

(ii) Current investments are carried at lower of cost and fair value determined on an individual investment basis.

k) Employee Benefits

(i) Short term employee benefits:

Short term employee''s benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related services are renders. These benefits include compensated absences such as annual leave encashment and bonus.

(ii) Long term employees Benefits:

A. Provident fund, family Pension fund & employees'' State Insurance Scheme:

As per the employees'' Provident funds and miscellaneous Provisions Act, 1952, all employees of the company are entitled to receive benefits under the provident fund and family pension fund, which is a defined contribution plan. These contributions are made to the fund administrated and managed by Government of India. In addition, some employees of the company are covered under employees'' State Insurance Scheme act, 1948, which are also defined contribution schemes recognized and administrated by Government of India

The company''s contributions to these schemes are recognized as expense in the statement of profit and loss during the year in which the employee renders the related service. The company has no further obligation under these plans beyond its monthly contributions.

B. Gratuity:

The liabilities is a defined benefit obligation and the present value of the obligation under defined benefits plan is determined based on actuarial valuation using the Project Unit Credit method, which recognizes each year of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up final obligation. The obligation is measured at the present value of the estimated cash flows. The discount rate used for determining the present value of the defined obligation under defined benefit plan, is based on the market yields on Government securities as at the balance sheet date. Actuarial gains and losses are recognized in the statement of Profit and Loss as and when determined.

l) Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets, upto the date the asset is put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

m) Leases

Leases wherein a significant portion of the risks and reward of ownership are retained by the lessor are classified as Operating Leases. Lease rentals in respect of such leases are charged to the Profit and Loss Account.

n) Earnings per share

Basic earnings per share

For the purpose of calculating basic earnings per share, the net profit or loss for the period attributable to equity shareholders after deducting preference dividends (if any) and any attributable tax thereto for the period is divided by weighted number of equity shares outstanding during the period.

Diluted earnings per share

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 equity shares.

o) Taxes on Income

(i) Current income tax is determined on the basis of taxable income after considering the various deductions available under The Income Tax Act, 1961.

(ii) Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

However in case of unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only to the extent that there is virtual certainty that sufficient future taxable income will be available to realise such assets. Such assets are reviewed at each balance sheet date to reassess its realisations.

(iii) Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period.

p) Provisions

A Provision is recognized when the Company has a present obligation as a result of a 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 reviewed at each balance sheet date and adjusted to reflect the current management estimates.

Contingent liabilities are disclosed by way of note to the Financial Statements after careful evaluation by the proprietor of facts and legal aspects of the matter involved.

Contingent Assets are neither recognized nor disclosed.


Mar 31, 2012

A) Basis of preparation of financial statements

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

b) Use of estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of the contingent liabilities as at the date of the financial statements and the amount of income and expenses during the period reported under the financial statement. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.

c) Revenue Recognition

Revenue is recognized to the extent it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(i) Sale of products are recognized on transfer of all significant risks and rewards of ownership of the goods on to the buyer, which is generally on dispatch of goods.

(ii) Service income is recognized, when the related services are provided.

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

(iv) Dividends are recorded when the right to receive payment is established.

d) Fixed Assets

Fixed assets are stated at cost less accumulated depreciation and accumulated impairment loss (if any). The cost of a fixed asset comprises its purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

e) Depreciation

Depreciation on fixed assets has been provided in a manner that amortizes the cost of the assets over their estimated useful lives as detailed below:

(i) On a straight-line method at the rates determined in the year of acquisition under section 205 (b) of the Companies Act, 1956 on single shift basis except in case of plant & machinery and Electrical installation, where depreciation has been provided on triple shift basis.

(ii) Leasehold land has not been amortized over the primary year of the lease.

f) Intangible Assets

Intangible assets are stated at costs less accumulated depreciation.

Intangible Assets (Computer Software) is amortized over a period of 5 years on straight line method.

g) Impairment Policy:

At each balance sheet date, the management reviews, the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset's or CGU's net selling price or its value in use. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

Reversal of impairment loss (if any), is recognised immediately as income in the statement of profit and loss.

h) Inventories

(i) Raw materials are valued at cost derived on average cost basis or net realizable value whichever is lower

(ii) Finished goods are stated at average material consumption cost and direct attributable overheads or Net realizable value whichever is lower.

(iii) Semi Finished Goods are valued at cost on the basis of process completion. .

i) Foreign Currency Transactions

(i) Initial Recognition: A foreign currency transaction is recorded, on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. .

(ii) Conversion: At the year end, monetary items denominated in foreign currencies are converted into rupee equivalents at the year-end exchange rates.

(iii) Exchange Differences: All exchange differences arising on settlement/conversion on foreign currency transactions are included in the Profit and Loss Account.

j) Investments

(i) Long-term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary.

(ii) Current investments are carried at lower of cost and fair value determined on an individual investment basis.

k) Employee Benefits

(i) Short term employee benefits:

Short term employee's benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related services are renders. These benefits include compensated absences such as annual leave encashment and bonus.

(ii) Long term employees Benefits:

A. Provident fund, family Pension fund & employees' State Insurance Scheme:

As per the employees' Provident funds and miscellaneous Provisions Act, 1952, all employees of the company are entitled to receive benefits under the provident fund and family pension fund, which is a defined contribution plan. These contributions are made to the fund administrated and managed by Government of India. In addition, some employees of the company are covered under employees' State Insurance Scheme act, 1948, which are also defined contribution schemes recognized and administrated by Government of India

The company's contributions to these schemes are recognized as expense in the statement of profit and loss during the year in which the employee renders the related service. The company has no further obligation under these plans beyond its monthly contributions.

B. Gratuity:

The liabilities is a defined benefit obligation and the present value of the obligation under defined benefits plan is determined based on actuarial valuation using the Project Unit Credit method, which recognizes each year of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up final obligation. The obligation is measured at the present value of the estimated cash flows. The discount rate used for determining the present value of the defined obligation under defined benefit plan, is based on the market yields on Government securities as at the balance sheet date. Actuarial gains and losses are recognized in the statement of Profit and Loss as and when determined.

I) Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets, upto the date the asset is put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

m) Leases

Leases wherein a significant portion of the risks and reward of ownership are retained by the lessor are classified as Operating Leases. Lease rentals in respect of such leases are charged to the Profit and Loss Account.

n) Earnings per share

Basic earnings per share

For the purpose of calculating basic earnings per share, the net profit or loss for the period attributable to equity shareholders after deducting preference dividends (if any) and any attributable tax thereto for the period is divided by weighted number of equity shares outstanding during the period. .

Diluted earnings per share

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 equity shares.

o) Taxes on Income

(i) Current income tax is determined on the basis of taxable income after considering the various deductions available under The Income Tax Act, 1961.

(ii) Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

However in case of unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only to the extent that there is virtual certainty that sufficient future taxable income will be available to realise such assets. Such assets are reviewed at each balance sheet date to reassess its realisations.

(iii) Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period.

p) Provisions

A Provision is recognized when the Company has a present obligation as a result of a 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 reviewed at each balance sheet date and adjusted to reflect the current management estimates.

Contingent liabilities are disclosed by way of note to the Financial Statements after careful evaluation by the proprietor of facts and legal aspects of the matter involved.

Contingent Assets are neither recognized nor disclosed.

 
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