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Accounting Policies of Rajkamal Synthetics Ltd. Company

Mar 31, 2015

(i) Basis of Preparation of financial Statements :

The financial statements have been prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values. GAAP comprises mandatory Accounting standards notified under 133 of the Companies Act, 2013 read together with Rules 7 of the Companies (Accounts) Rules, 2014, the provisions of the Companies Act, 2013 and guide lines issued by the securities and Exchange Board of India ( SEBI ). Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use or different accounting policy is required by status.

(ii) Use of Estimates :

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires estimates and assumption to be made. That affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known/materialized.

(iii) Investments :

Long term Investment are stated at cost. Provision for permanent diminution in value of Long term investment is made only if such decline is other than temporary in the opinion of management. Investments other than long term investments being current investments are valued at cost or fair value whichever is lower.

(iv) Provision :

Provision are recognized when an enterprise 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 deremined based on management estimate require to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates.

(v) Treatment of Contingent Liabilities :

Contingent Liabilities are disclosed by way of notes. Provision is made in the accounts for those liabilites which are likely to materialize after the year end till the finalization of accounts and having effect on the position stated in the balance sheet as at the year end.

(vi) Taxation :

Provision for taxation has been made in accordance with the rates of Income Tax Act, 1961 prevailing for the relevant assessment year.

(vii) Deferred Taxation :

Deferred tax assets and liabilites are recognized for the future tax consequences attributable to timing differences that result between the profits offered for income taxes and the profits as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantially enacted at the balance sheet date. Deferred tax Assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future. Deferred tax Assets are reviewed as at each Balance Sheet date.

(viii) Revenue Recognition :

Sales are recognized, net of returns discounts, on dispatch of goods to Customers.

Interest income is recognized on time proportion basis.

Dividends are recognized when actually received.

(ix) Employee Retirement Benefits :

Company's contributions to provident fund and subscription to Employees group gratuity scheme of life Insurance Corporation of India is charged to profit and Loss Account and further, leave salary and bonus are charged to profit and loss account on cash basis.


Mar 31, 2014

A. Basis of Accounting :

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values. GAAP comprises mandatory Accounting standards as prescribed by the Companies (Accounting Standard) Rules 2006 the provisions of the Companies Act, 1956 and guide lines issued by the securities and Exchange Board of India ( SEBI ) Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

B. Use of Estimates :

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires estimates and assumption to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilites on the financial statements and the reported amounts of revenues and expenses during the reporting period.

C. Revenue Recognition :

The principal source of revenue for the company is from sale of Fabrics and other sources are dividend and interest income which are recognized as follows :

i) Sales are recognized as and when the significant risk & rewards in respect of goods is transferred to the buyer.

ii) Interest income is recognized on time proportion basis.

iii) Dividends are recognized when actually received.

D. Investments :

Investments that are intended to be held for more than a year, from the date of acquisition, are classified as long term. Investment are carried at cost less any provision for permanent diminution in value. Investment other than long term investments being current investments are valued at cost or fair value whichever is lower.

E. Accounting for Taxes of Income :

Current Taxes

Provision for current income-tax is recognized in accordance with the provisions of Indian Income-tax Act, 1961 and is made annually based on the tax liability after taking credit for tax allowances and exemptions.

Deferred Taxes :

Deferred tax assets and liabilites are recognized for the future tax consequences attributable to timing differences that result between the profits offered for income taxes and the profits as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantially enacted at the balance sheet date. Deferred tax Assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future. Deferred tax Assets are reviewed as at each Balance Sheet date.

F. Provisions and Contingent Liabilities :

i) Provision are recognized in terms of Accounting Standard 29 - "Provisions, Contingent Liabilities and Contingent Assets" issued by The Institute of Chartered Accountants of India (ICAI ), when there is a present legal or statutory obligation as a result of past events where it is probable that there will be outflow of resources to settle the obligation and when a reliable estimate of the amount of the obligation can be made.

ii) Contingent Liabilities are recognized only when there is a possible obligation arising from past events due to occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the company or where reliable estimate of the obligation cannot be made. Obligations are assessed on an ongoing basis and only those having a largely probable outflow of resources are provided for.

iii) Contingent Liabilities are disclosed by way of notes.


Mar 31, 2013

A. Basis of Accounting :

The financial statements have been prepared under the historical cost convention, on the accrual basis of accounting and in accordance with the Generally Accepted Accounting Principles in India and comply with the Accouting Standards prescribed by the Companies (Accounting Standard) Rules 2006 to the extent applicable and in accordance with the relevant provisions of the Companies Act, 1956.

B. Use of Estimates :

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires estimates and assumption to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilites on the financial statements and the reported amounts of revenues and expenses during the reporting period.

C. Revenue Recognition :

i) Sales is recognized as and when the significant risk & rewards in respect of goods is transferred to the buyer.

ii) Interest income is recognized on time proportion basis.

D. Accounting for Taxes of Income : Current Taxes

Provision for current income-tax is recognized in accordance with the provisions of Indian Income-tax Act, 1961 and is made annually based on the tax liability after taking credit for tax allowances and exemptions.

E. Deferred Taxes :

Deferred tax assets and liabilites are recognized for the future tax consequences attributable to timing differences that result between the profits offered for income taxes and the profits as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantially enacted at the balance sheet date. Deferred tax Assets are recognized only to the extent there is reasonable certainity that the assets can be realized in the future. Deferred tax Assets are reviewed as at each Balance Sheet date.

F. Provisions and Contingent Liabilities :

i) Provision are recognized in terms of Accounting Standard 29 - "Provisions, Contingent Liabilities and Contingent

Assets" issued by the Institute of Chartered Accountants of India ( ICA ), when there is a present legal or statutory obligation as a result of past events where it is probable that there will be outflow of resources to settle the obligation and when a reliable estimate of the amount of the obligation can be made.

(ii) Contingent Liabilities are recognized only when there is a possible obligation arising from past events due to occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the company or where reliable estimate of the obligation cannot be made. Obligations are assessed on an ongoing basis and only those having a largely probably outflow of resources are provided for.

(ii) There are no contingent liabilities for the financial year under audit.

G. Impairment of Assets :

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is changed to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period reversed if there has been a change in the estimate of recoverable amount.


Mar 31, 2011

(1) Basis of Accounting :

Financial Statements are prepared on cash basis, except for audit fees, no other provisions are made.

(2) Debenture Redemption Reserve :

As per the guidelines issued by the Ministry of Finance on 14th January, 1987, a Debenture Redemption Reserve is to be created by Companies raising resources through Debentures. The Company is of the view that these guide-lines are not applicable to the issue of debentures opened prior to 14th January, 1987 and has therefore not created a Debenture Redemption Reserve.

(3) Taxes on Income :

(a) Provision for current tax, if any is computed in accordance with the relevant tax regulations.

(b) Deferred tax is recognized for all timing difference between accounting Income and taxable income and is quantified using enacted/substantially enacted tax as at the balance sheet date. Deferred tax asset are recognized subject to the management judgement that the realization is virtually certain.


Mar 31, 2010

(1) Basis of Accounting :

Financial Statements are prepared on cash basis, except for audit fees, no other provisions are made.

(2) Debenture Redemption Reserve :

As per the guidelines issued by the Ministry of Finance on 14th January, 1987, a Debenture Redemption Reserve is to be created by Companies raising resources through Debentures. The Company is of the view that these guide-lines are not applicable to the issue of debentures opened prior to 14th January, 1987 and has therefore not created a Debenture Redemption Reserve.

(3) Taxes on Income :

(a) Provision for current tax, if any is computed in accordance with the relevant tax regulations.

(b) Deferred tax is recognized for all timing difference between accounting income and taxable income and is quantified using enacted/substantially enacted tax as at the balance sheet date. Deferred tax asset are recognized subject to the management judgement that the realization is virtually certain.

 
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