Mar 31, 2014
(a) Accounting Convention
The Accounts of the Company are prepared under the Historical Cost Convention on the Accrual Basis of Accounting in accordance with the Generally Accepted Accounting Principles in India ("GAAP") and in compliance with the mandatory Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and with the relevant provisions of the Companies Act, 1956. The Financial Statements are presented in Indian Rupees rounded off to the nearest rupees.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting periods. Examples of such estimate include future obligations under employee benefit plans, income taxes, useful lives of fixed assets and intangible assets, impairment of assets, provision for doubtful debts etc. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could vary from these estimates. Appropriate changes in estimates are made as the management becomes aware of the changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognized in the period in which such results are known/ materialized. Effect of material changes is disclosed in the notes to the financial statements.
The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.
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 revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisitions of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-non-current classification of assets and liabilities.
(b) Tangible Assets, Depreciation
i. Tangible assets are stated at Cost less Accumulated Depreciation, Impairment loss, if any, ascertained as per the Accounting Standard 28 (Impairment of Assets). Cost comprises the Purchase Price and any such costs attributable for the purpose of bringing the asset to its working condition for its intended use.
ii. Tangible Assets under construction, Advances paid towards acquisition of Tangible Assets and Cost of Assets not ready for use as at the year end, are disclosed as Capital Work-In Progress.
iii. In respect of Tangible Assets depreciation is provided on Straight line basis applying the rates specified in schedule XIV of Companies Act 1956 except Computer.
iv. Tangible Assets below Rs.10000 are fully depreciated in the year of acquisition.
Investments of long term-nature are stated at cost, less adjustment for any diminution, other than temporary, in the value thereof. Current Investment are stated at lower of cost or market value.
1. Finished and Semi-Finished Products produced and purchased by the company are carried at Cost and net realisable value, whichever is lower.
2. Work in Progress is carried at lower of cost and net realisable value.
3. Raw Material is carried at lower of cost and net realisable value.
4. Stores and Spares parts are carried at cost. Necessary provision is made and expensed in case of identified obsolete and non moving items.
Cost of Inventory is generally ascertained on the "Weighted average'' basis.
Cost Comprises expenditure incurred in the normal course of business in bringing such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activity. Packing Material is considered as finished goods. Consumable stores are written off in the year of Purchase.
(e) Employee Benefits
Provision for Gratuity, Leave Encashment and bonus has not been made as none of the employee have completed the minimum qualified period of services.
(f) Impairment of Assets
At each balance sheet date, the management reviews the carrying amounts of each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exits, the recoverable amount of the assets is estimated in order to determine the extent of impairment loss. Recoverable amount is higher of an asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the assets and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the assets. Cash flows used to determine value in use are derived from annual budgets and strategic plans of the cash generating units.
(g) Revenue Recognition
Sale are recognized on when substantial risks and rewards of ownership in the goods are transferred to the buyer i.e. delivery as per terms of sale.
(h) Other Income
Interest Income and income from Investments are accounted on accrual basis.
Dividend Income is recognized when the right to receive dividend is established.
(i) Foreign Currency Transactions
Transactions in Foreign Currency and Non-Monetary Assets are accounted for at the Exchange Rate prevailing on the date of the transaction. All monetary items denominated in Foreign Currency are converted at the Year-End Exchange Rate. The Exchange Differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise.
(j) Taxes on Income
Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.
Deferred Tax is recognized for all the timing differences, subject to the consideration of prudence in respect of deferred tax assets.
Deferred Tax Assets are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.
(k) Cash & Cash Equivalent
Cash & Cash Equivalent for the purpose of cash flow statement comprises of cash at bank and in hand and short term investments/ bank deposits with an original maturity of three months or less.
A Provision is recognized when company has a present obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
(m) Trade Receivables:
In respect of Receivable for Sundry Debtors (Incl. Receivable on Sale of Investments) of Rs.28.77 Lacs and Other Trade receivable, the amount of Bad & Doubtful Debts are is not ascertainable on account of non- receipt of confirmation from the party.
Mar 31, 2011
A) Accounting Convention
The financial statements are prepared under historical cost convention, on accrual basis, in accordance with the generally accepted accounting principles in India and to comply with the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government in exercise of the power conferred under sub-section (1) (a) of section 642 and the relevant provisions of the Companies Act, 1956 ("the Act").
b) Use of Estimates
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the results of operations during the reporting periods. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from those estimates and revisions, if any, are recognized in the current and future periods.
c) Fixed Assets & Depreciation.
(i) Fixed assets are stated at cost less accumulated depreciation/amortization. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
(ii) Fixed assets under construction, advances paid towards acquisition of fixed assets and cost of assets not ready for use as at the year end, are disclosed as capital work-in progress.
(iii) Depreciation on fixed assets is provided on WDV method on pro rata basis from the date of addition at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.
Investments classified as long-term investments are stated at cost. Diminution in the investment has not been worked out and provided.
Inventory comprises of raw materials, Semi finished and Finished goods are valued at Cost or net realizable Value, whichever is lower.
Consumable stores are written off in the year of Purchase.
f) Employee Benefits
Provision for gratuity has not been made as none of the employee have completed the minimum qualified period of services.
g) Claims, Demands and Contingencies
Details of disputed and or contingent liabilities are not available.
h) Provision for Current and Deferred Tax :
i) Tax liability of the company is estimated considering the provision of Income Tax Act, 1961.
ii) Deferred tax is recognized subject to consideration of prudence, on timing difference being the difference between taxable incomes and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s). Such deferred tax is quantified using rates and laws enacted or substantively enacted as at the end of the financial year.
i) 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 generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and 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 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.
j) Revenue Recognition:
Revenue is recognized to the extent that it is probable that the economics benefits will flow to the company and the revenue can be reliably measured.
Sale of Goods:
Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales re reported net of Sales Tax and Excise Duty.
Revenue is recognized on a time proportion basis talking into accounts the amount outstanding and the rate applicable.
k) Foreign currency transactions
Transactions in foreign currency and non-monetary assets are accounted for at the exchange rate prevailing on the date of the transaction. All monetary items denominated in foreign currency are converted at the year-end exchange rate. The exchange differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise.