Mar 31, 2018
A Significant Accounting Polices
A.1 Basis of Preparation of Financial Statements
Statement of Compliance with Indian Accounting Standards (IND AS): The financial statements have been prepared in accordance with IND AS notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended and notifies under Section 133 of the Companies Act, 2013 (âthe Actâ) and other relevant provisions of the Act and other accounting principles generally accepted in India. These are the Companys first IND AS Financial Statements. The date of transition to IND AS is 1st April, 2016.
Up to the financial year ended on 31st March, 2017, the Company prepared its financial statements in accordance with the requirements of the previous applicable GAAP which included the Standards notified under the Companies (Accounting Standards) Rules, 2006 notified under Section 133 of the Act and other relevant provisions of the Act.
First time adoption: In accordance with IND AS 101 on First-time adoption of Indian Accounting Standards, the Companys first IND AS financial statements include, three balance sheets viz. the opening balance sheet as at 1st April, 2016 and balance sheets as at 31st March, 2017 and 2018, and, two statements each of profit and loss, cash flows and changes in equity for the years ended 31st March, 2017and 2018 together with related notes. The same accounting policies have been used for all periods presented, (except where the company has made use of exceptions and exemptions allowed under IND AS 101 in the preparation of the opening IND AS balance sheet which have been disclosed in note: D)
A.2 Summary of Significant Accounting Policies
A.2.1 Property, Plant and Equipment
Property, Plant and equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable to bringing the assets to its working condition for its intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the assets.
Subsequent costs are included in the assetâs carrying amount or recognized as separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured reliably.
Depreciation on Property, plant and equipment is provided on Straight Line Method (SLM) over the estimated useful lives of the assets considering the nature, estimated usage, operating conditions, past history or replacement, anticipated technological changes, manufacturerâs warranties and maintenance support.
Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013 except in respect of the following assets, where useful life is different than those prescribed in Schedule II.
The residual values, useful lives and methods of depreciation of Property, plant and equipment are reviewed at the end of each reporting period and adjusted prospectively, if appropriate.
Gains or losses arising from derecognition of a property, plant and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the asset is derecognized.
A.2.2 Intangible Assets
Intangible Assets are stated at cost of acquisition net of recoverable taxes, trade discount and rebates less accumulated amortization/depletion and impairment loss, if any. Such cost includes purchase price, borrowing costs, and any cost directly attributable to bringing the asset to its working condition for the intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the intangible assets.
Subsequent costs are included in the assetâs carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured reliably.
Gains or losses arising from de recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the asset is derecognized.
A.2.3 Research and Development Expenditure
Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of products are charged to the Statement of Profit and Loss.
The company has recognized the research & development expenditure incurred for the development, modification, upgradation of plastic processing machinery and spares manufacturing. The capital expenditure is recognized and included in the cost of Plant & Machinery and Computer in the Balance sheet and Revenue expenditure is charged to Statement of Profit and Loss Account as detailed here;
A.2.4 Inventories
Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any. Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads net of recoverable taxes incurred in bringing them to their respective present location and condition.
Cost of raw materials, consumable and other products are determined on weighted average basis.
A.2.5 Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A.2.6 Employee Benefits Expense Short Term Employee Benefits
The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognized as an expense during the period when the employees render the services.
Post-Employment Benefits Defined Contribution Plans
Adefined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund. The Companys contribution is recognized as an expense in the Statement of Profit and Loss during the period in which the employee renders the related service.
Defined Benefit Plans
The Company pays gratuity to the employees whoever has completed five years of service with the Company at the time of resignation/superannuation. The gratuity is paid @15 days salary for every completed year of service as perthe Payment of Gratuity Act 1972.
The gratuity liability amount is contributed to the approved gratuity fund formed exclusively for gratuity payment to the employees. The gratuity fund has been approved by respective IT authorities.
The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from employeesâ services.
Re-measurement of defined benefit plans in respect of post-employment are charged to the Other Comprehensive Income.
A.2.7 Tax Expenses
The tax expense for the period comprises current and deferred tax. Taxis recognized in Statement of Profit and Loss, except to the extent that it relates to items recognized in the comprehensive income or in equity. In which case, the tax is also recognized in other comprehensive income or equity.
- Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.
- Deferred Tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of deferred tax liabilities and assets are reviewed at the end of each reporting period.
A.2.8 Foreign currencies transactions
The functional currency of the company is the Indian Rupee. These financial statements are presented in Indian Rupees.
Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency closing rates of exchange at the reporting date.
Gain or losses upon settlement of foreign currency transactions are recognized in the statement of profit and loss for the period in which the transaction is settled.
A.2.9 Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection.
-Sale of goods
Revenue from sale of goods is recognized when ownership in the goods is transferred to the buyer for a price, when significant risks and rewards of ownership have been transferred to the buyer and no effective control, to a degree usually associated with ownership, is retained by the Company. Sale of goods are stated net of trade discounts and volume rebates and include excise duty up to 30th June, 2017.
- Income from services
Income from service rendered is recognized based on the terms of the agreements as and when services are rendered and are net of applicabletaxes.
-Other Income - Interest income
Interest income from a financial asset is recognized using effective interest rate method.
- Dividend Income
Dividend income on investments is recognized when the right to receive dividend is established.
A.2.10 Financial instruments
A.2.10.1 Financial Assets
- Initial recognition and measurement
All financial assets and liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition. Purchase and sale of financial assets are recognized using trade date accounting.
- Subsequent measurement
- Financial assets carried at amortized cost (AC)
A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
- Financial assets at fair value through other comprehensive income (FVTOCI)
A financial asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
- Financial assets at fair value through profit or loss (FVTPL)
Afinancial assetwhich is not classified in any of the above categories are measured at FVTPL.
- Investment in subsidiaries, Associates and Joint Ventures
The Company has accounted for its investments in joint venture at cost.
- Other Equity Investments
All other equity investments are measured at fair value, with value changes recognized in Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the value changes in Other Comprehensive Income1.
A.2.10.2 Financial Liabilities
- Initial recognition and measurement
All financial liabilities are recognized at fair value and in case of loans, net of directly attributable cost. Fees of recurring nature are directly recognized in the Statement of Profit and Loss as finance cost.
- Subsequent measurement
Financial liabilities are carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
A.2.11FairValue Measurement
The Company measures financial instruments at fair value at each balance sheet date.
The fair value of an asset or a liability is measured usinq the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participantâs ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. The Company uses the following hierarchy for determining and disclosing thefair value of financial instruments by valuation technique:
Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2: Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.
Level 3: Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.
For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
Mar 31, 2015
(i) Use of Estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management''s best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring adjustment to carrying amounts of assets or liabilities in
future periods. Difference between the actual results and estimates are
recognized in the period in which the results are known /materialized.
3.02 Inventories:
Items of inventories are measured at lower of cost or net realizable
value after providing for obsolescence, if any. Cost of inventories
comprises of cost of purchase, cost of conversion and other cost
including manufacturing overheads incurred in bringing them to their
respective present condition and location. Cost of Raw Material
including components, Testing Materials, Scrap and consumable stores
are determined on FIFO basis.
Net realizable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and estimated
costs necessary to make the sale.
3.03 Depreciation:
Depreciation on tangible assets and intangible assets is provided on
the straight line method over the useful lives of assets prescribed
under Part C of Schedule II of the Companies Act, 2013.
3.04 Revenue Recognition:
In appropriate circumstances, Revenue income is recognized when no
significant uncertainty as to determination or realization exists.
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and rate applicable.
3.05 Fixed Assets:
Tangible fixed assets are stated at cost net of recoverable taxes less
accumulated depreciation.
Intangible assets are stated at cost of acquisition net of recoverable
taxes less accumulated depreciation.
3.06 Foreign Currency Transactions:
(i) Transactions dominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction or that
approximates the actual rate at the date of the transaction.
(ii) Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts is recognized over
the life of the contracts.
(iii) In respect of branches, which are integral foreign operations,
all transactions are translated at rates prevailing on the date of
transaction or that approximates the actual rate at the date of
transactions. Branch monetary assets and liabilities are restated at
the year end rates.
(iv) Any income or expenses on account of exchange difference either on
settlement or on translation is recognized in the profit or loss
account.
3.07 Retirement Benefit:
i) Provident fund:
Retirement benefit in the form of provident fund is a defined
contribution scheme. The contributions to the provident fund are
charged to the statement of profit and loss for the year when the
contributions are due. The company has no obligation, other than the
contribution payable to the provident fund.
ii) Gratuity:
The company has established the employees Group Gratuity-Cum-Life
Assurance Scheme with Life Insurance Corporation of India through
employees trust. The cost of providing benefit under the scheme are
determined on the basis of actuarial valuation at each year end and
contribution for the year is charged to the statement of profit and
loss for the year.
iii) Leave Encashment:
The company measures the expected cost that it expects to pay as a
result of unused entitlement that has accumulated at the reporting date
and the earned leave amount for the current reporting period is charged
to the statement of profit and loss for the year. The company presents
the entire leave as current liability in the balance sheet, since it
does not have an unconditional right to defer its settlement for 12
months after the reporting date.
3.08 Borrowing Cost:
Borrowing costs that are attributable to the acquisition or
construction of assets are capitalized as part of cost of such assets.
All other borrowing costs are charged to revenue.
3.09 Related Parties Disclosures:
As required by Accounting Standard (AS) - 18 "Related Party
Disclosures" is made as under:
(i) List of related parties where control exits and related parties
with whom transactions have taken place and relationship. Names of the
related party and description of relationship with whom there were
transactions during the year.
3.10 Lease:
In earlier year, the Crome Plating Division of the factory at Veraval
(Shapar), Rajkot was given on lease to M/s. Shail Engineers for a
monthly rent of Rs.50,000/-. The lease rental agreement has not been
renewed during the year.
3.11 Provision for Current and Deferred Tax:
Provision for Current tax is based on the assessable income under the
provisions of the Income-tax Act, 1961.
Deferred tax is recognized on timing difference between taxable income
and accounting income that originate in one period and capable of
reversal in one or more subsequent periods. Deferred tax resulting from
"timing differences" is accounted for using tax rates and laws that
have been enacted or substantively enacted as on the balance sheet
date. The deferred tax assets is recognized and carried forward only to
the extent that there is a reasonable / virtual certainty that the
asset will be realized in future.
3.12 Impairment of Assets:
An asset is treated as impaired when the carrying cost of asset exceeds
its recoverable value. An impairment loss is charged to statement of
profit and loss account in the year in which an asset is identified as
impaired. The impairment loss recognized in prior accounting period is
reversed if there has been a change in the estimate of recoverable
amount.
3.13 Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent liabilities are not recognized but are disclosed in the
notes. Contingent assets are neither recognized nor disclosed in the
Financial Statements.
3.14 Segment Reporting:
As the company''s business activity falls within a single business
segment viz. Plastic Processing Machineries and post extrusion
equipments, the disclosure requirements of Accounting standard (AS) 17
"Segment reporting" issued by the Institute of Chartered
Accountants of India is not applicable.
Mar 31, 2012
1.01 Disclosure of Accounting Policies:
(i) Presentation and disclosure of financial statements
The revised schedule VI notified under the companies Act, 1956, has
become applicable to the company, for preparation and presentation of
its financial statements for the current year. The adoption of revised
schedule VI does not impact recognition and measurement principal
followed for preparation and presentation of its financial statements.
However, it has significant impact on presentation and disclosures made
in the financial statements. The company has also reclassified the
previous year figures in accordance with the requirements applicable in
the current year.
(ii) Use of Estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management's best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring adjustment to carrying amounts of assets or liabilities in
future periods. Difference between the actual results and estimates are
recognized in the period in which the results are known /materialized.
1.02 Inventories:
Items of inventories are measured at lower of cost or net realizable
value after providing for obsolescence, if any. Cost of inventories
comprises of cost of purchase, cost of conversion and other cost
including manufacturing overheads incurred in bringing them to their
respective present condition and location. Cost of Raw Material
including components, Testing Materials, Scrap and consumable stores
are determined on FIFO basis.
Net realizable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and estimated
costs necessary to make the sale,
1.03 Depreciation:
Depreciation on tangible fixed assets is provided on straight line
method (SLM) at the rate specified in schedule XIV of the Companies
Act, 1956.
Depreciation on intangible fixed assets is provided on straight line
method (SLM) at the rate determined considering the estimated useful
life of the assets.
1.04 Revenue Recognition:
In appropriate circumstances, Revenue income is recognized when no
significant uncertainty as to determination or realization exists.
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and rate applicable.
1.05 Fixed Assets:
Tangible fixed assets are stated at cost net of recoverable taxes less
accumulated depreciation.
Intangible assets are stated at cost of acquisition net of recoverable
taxes less accumulated depreciation,
1.06 Foreign Currency Transactions:
(i) Transactions dominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction or that
approximates the actual rate at the date of the transaction.
(ii) Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts is recognized over
the life of the contracts.
(iii) In respect of branches, which are integral foreign operations,
all transactions are translated at rates prevailing on the date of
transaction or that approximates the actual rate at the date of
transactions. Branch monetary assets and liabilities are restated at
the year end rates,
(iv) Any income or expenses on account of exchange difference either on
settlement or on translation is recognized in the profit or loss
account.
1.07 Retirement Benefit:
i) Provident fund:
Retirement benefit in the form of provident fund is a defined
contribution scheme. The contributions to the provident fund are
charged to the statement of profit and loss for the year when the
contributions are due. The company has no obligation, other than the
contribution payable to the provident fund.
ii) Gratuity:
The company has established the employees Group Gratuity-Cum-Life
Assurance Scheme with Life Insurance Corporation of India through
employees trust. The cost of providing benefit under the scheme are
determined on the basis of actuarial valuation at each year end and
contribution for the year is charged to the statement of profit and
loss for the year.
iii) Leave Encashment:
The company measures the expected cost that it expects to pay as a
result of unused entitlement that has accumulated at the reporting date
and the earned leave amount for the current reporting period is charged
to the statement of profit and loss for the year. The company presents
the entire leave as current liability in the balance sheet, since it
does not have an unconditional right to defer its settlement for 12
months after the reporting date.
1.08 Borrowing Cost:
Borrowing costs that are attributable to the acquisition or
construction of assets are capitalized as part of cost of such assets.
All other borrowing costs are charged to revenue.
1.09 Related Parties Disclosures:
As required by Accounting Standard (AS) - 18 "Related Party
Disclosures" is made as under:
(I) List of related parties where control exits and related parties
with whom transactions have taken place and relationship. Names of the
related party and description of relationship with whom there were
transactions during the year.
1.10 Lease:
The lease arrangement with Veeram Pack Pvt. Ltd. (formerly known as
Wonderpack Industries Pvt. Ltd.) for their factory at Nashik is
terminated with effect from 30.09.2011 and Lease rent paid is charged
to statement of Profit and Loss account of Wonderpack Division as
prepared under Note No. 29 forming an integral part of financial
statements.
For the Crome Plating Division of the factory at Veraval (Shapar),
Rajkot, the company has entered into Rent Agreement with M/s. Shail
Engineers from 01.04.2011 at monthly rent of Rs.50,000/- which is
renewable every year.
1.11 Provision for Current and Deferred Tax:
Provision for Current tax is based on the assessable income under the
provisions of the Income-tax Act, 1961.
Deferred tax is recognized on timing difference between taxable income
and accounting income that originate in one period and capable of
reversal in one or more subsequent periods. Deferred tax resulting from
"timing differences" is accounted for using tax rates and laws that
have been enacted or substantively enacted as on the balance sheet
date. The deferred tax assets is recognized and carried forward only to
the extent that there is a reasonable / virtual certainty that the
asset will be realized in future.
1.12 Discontinuing Operations of Wonderpack Division, Nashik :
The company has discontinued manufacturing operations of Wonderpack
Division at Nashik, (Maharashtra) from 30.09.2011 which was under lease
arrangement and there are no plans for revival of manufacturing
activities in near future.
Loss from Wonderpack Division, Nashik is separately disclosed as per
Note No. 29,
The computers System remained after closure of the division are
transferred to Veraval(Shapar), Rajkot Unit,
1.13 Impairment of Assets:
An asset is treated as impaired when the carrying cost of asset exceeds
its recoverable value. An impairment loss is charged to statement of
profit and loss account in the year in which an asset is identified as
impaired. The impairment loss recognized in prior accounting period is
reversed if there has been a change in the estimate of recoverable
amount.
1.14 Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent liabilities are not recognized but are disclosed in the
notes. Contingent assets are neither recognized nor disclosed in the
Financial Statements.
Contingent Liability Rs. In Lacs
Bank Guarantee for Performance 19.42
1.15 Segment Reporting:
As the company's business activity falls within a single business
segment viz. Plastic Processing Machineries and post extrusion
equipments and as Nashik Unit do not affect predominantly risk and
return of the enterprise on account of negligible turnover in relation
to total turnover of the enterprise, the disclosure requirements of
Accounting standard (AS) 17 "Segment reporting" issued by the Institute
of Chartered Accountants of India is not applicable.
Mar 31, 2011
1. Basis of Preparations of financial statement:
The Financial statements are prepared in accordance with generally
accepted accounting principles under historical cost convention on the
accrual basis.
2. Use of Estimates:
The presentation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Difference
between the actual result and the estimates are recognized in the
period in which the results are known /materialized.
3. Revenue Recognition:
In appropriate circumstances, revenue income is recognized when no
significant uncertainty as to determination or realization exists.
4. Fixed Assets:
Fixed assets are stated at cost net of CENVAT, less accumulated
depreciation. Direct costs are capitalized until fixed assets are ready
for use. Capital work in progress comprised outstanding advances paid
to acquire fixed assets and the cost of fixed assets that are not yet
ready for their intended use before the balance sheet date are recorded
at the consideration paid for acquisition.
5. Depreciation:
Depreciation on fixed assets is provided on straight line method (SLM)
at the rate specified in schedule XIV of the Companies Act, 1956.
6. Foreign Currency transactions:
Foreign currency transaction forward contracts are stated at the
forward contract rates while those not covered by forward contracts are
restated at the rates ruling at the end of the year. Exchange
differences relating to fixed assets are adjusted in the cost of the
assets. Any other exchange differences are dealt with in the Profit &
Loss A/c.
7. Investments:
Long term investments are stated at cost and provisions for diminution
in the value of long term investments are made only if such a decline
is other than temporary in the opinion of the management.
8. Retirement Benefits to Employees:
i) Provident fund:
The Company's contribution to provident fund and family pension fund is
charged to profit & loss account. The company has no further
obligation under Employees Provident fund Act.
ii) Gratuity:
The company has taken a group policy for gratuity with Life Insurance
Corporation of India. The contribution on the basis of actuarial
valuation is charged to profit and loss account. The company has no
further obligation under Gratuity Act.
iii) Leave Encashment:
The liability for leave encashment payable to employees is debited to
profit and loss account as calculated by the management.
iv) ESIC:
ESIC is applicable for Wonderpack Division Nashik only and the
Company's contribution to ESIC is charged to Profit & Loss account. The
Companyhas no further obligation under ESI Act.
9. Sales:
Sales is accounted excluding excise duty, service tax and Central sales
tax (CST). Value Added Tax (VAT) collected on sales is accounted
separately in the VAT - Input Credit Account.
10. Purchase:
Purchase of raw material and components, testing material, consumable
stores are accounted excluding excise duty and Central Sales tax. Value
Added tax (VAT) paid on purchase is accounted separately in VAT - Input
Credit Account.
11. Excise duty (Including Education Cess & Secondary & Higher
Secondary Education Cess):
The Excise duty is applicable to Raw Material and finished goods of the
company. The company is eligible for CENVAT credit for excise duty paid
on purchase of Raw material, Components and Stores. The Balance of
CENVAT credit remained unavailed at the end of the year is eligible for
carry forward for the purpose of set-off against excise duty payable on
sales in subsequent year. The balance of CENVAT credit unavailed at the
end of the year is shown under "Excise Duty Receivable" under "Loans
and Advances" in the schedule of "Current Assets, Loans and Advances"
forming part of Balance Sheet.
12. Sales tax:
a) The company is eligible for Set off of Value Added tax paid on
purchases made from parties situated in the state of Gujarat as per the
Provision of Gujarat Value Added Tax Act, 2003 and Maharashtra Value
Added Tax Act, 2002. The amount eligible for sales-tax set-off is
accounted separately in VAT- Input Credit Account and not included in
the purchases of the company.
b) Value Added Tax collected on sales and eligible for VAT set-off as
per the provision of Gujarat Value Added Tax Act 2003 and Maharashtra
Value Added Tax Act,2002 is accounted separately in VAT- Input Credit
Account and not included in the sales of the company. The Debit balance
of VAT- Input Credit Account represents the excess of VAT paid on
purchase over the VAT collected on sales and is shown under "VAT
Receivable" under "Loans and Advances" in the schedule of "Current
Assets, Loans and Advances" forming part of Balance Sheet.
13. Service Tax:
Service Tax on services availed and services provided are accounted
separately in Service Tax Account and set-off is claimed against Excise
Duty payable on Sales. The balance of the Service tax Credit un availed
at the end of the year is shown under "Service Tax Receivable" under "
Loans & Advances" in the schedule of "Current Assets, Loans and
Advances" forming part of Balance sheet.
14. Inventories:
i) Raw Material & Components
It is valued at Purchase cost excluding Central Excise Duty but
including Central Sales Tax and other cost incurred to bring the
inventory to present condition and location. The Central Excise duty
and Gujarat Value Added Tax paid on purchase are not considered in the
valuation of inventories for the following reasons.
1) A purchase is accounted excluding Central Excise Duty and therefore,
it is not considered for valuation of Inventories.
2) The Value Added Tax paid on purchases eligible for VAT set-off is
accounted separately under VAT Ã Input Credit Account. It is not
included in purchases and therefore, it is not considered for valuation
of inventories.
ii) Testing Material
It is valued at Purchase cost including Central Sales Tax and other
cost incurred to bring the inventory to present condition and location.
iii) Consumable stores
At cost or net realizable value whichever is lower.
iv) Scrap / Plastic Packing Material for Captive Consumption At cost or
net realizable value whichever is lower.
v) Stock in Process
It is valued at Raw Material cost plus production cost incurred to
bring the inventory to present condition and location.
vi) Finished Goods
It is valued at Selling rate.
The Finished Goods have been valued at selling price as the company
manufactures goods on customer's order
15. Research and Development:
Expenditure relating to capital items is debited to fixed assets and
depreciated at applicable rates. Revenue expenditure is charged to
profit and loss account of the year.
16. Borrowing Costs:
Borrowing costs that are attributable to the acquisition or
construction of assets are capitalized as part of cost of such assets.
All other borrowing costs are charged to revenue.
17. Income Tax:
Provision for current tax is made on the basis of taxable income
computed in accordance with the Income Tax Act, 1961.
18. Deferred tax:
Deferred tax is recognized on timing difference between taxable income
and accounting income that originate in one period and capable of
reversal in one or more subsequent periods. Deferred tax resulting from
"timing differences" is accounted for using tax rates and laws that
have been enacted or substantively enacted as on the balance sheet
date. The deferred tax assets is recognized and carried forward only
to the extent that there is a reasonable / virtual certainty that the
asset will be realized in future.
19. Contingent Liabilities:
All liabilities have been provided for in the accounts except
liabilities of a contingent nature, which have been disclosed at their
estimated value in the Notes on Accounts.
20. Earning per share:
The company reports basic and diluted Earning per share (EPS) in
accordance with Accounting standard (AS) - 20. Basic earning per share
is computed by dividing net profit for the year by the weighted average
number of shares outstanding during the period. Diluted earning per
share is computed by dividing net profit by the weighted shares
considered for deriving basic earning per share and also the weighted
average number of equity shares that could have been issued on the
conversion of all dilutive potential equity shares.
Mar 31, 2010
1. Basis of Preparations of financial statement:
The Financial statements are prepared in accordance with generally
accepted accounting principles under historical cost convention on the
accrual basis,
2. Use of Estimates
The presentation ot financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Difference
between the actual result and the estimates are recognized in the
period in which the results are known /materialized.
3. Revenue Recognition
in appropriate circumstances, revenue income is recognized when no
significant uncertainty as to determination or realization exists.
4. Fixed Assets
Fixed assets are stated at cost net of CENVAT, less accumulated
depreciation. Direct costs are capitalized until fixed assets are ready
for use, Capital work in progress comprised outstanding advances paid
to acquire fixed assets and the cost of fixed assets that are not yet
ready for their intended use before the balance sheet date are recorded
ai the consideration paid for acquisition.
5. Depreciation
Depreciation on fixed assets is provided on straight line method (SIM)
at the rate specified in schedule XIV of the Companies Act, 1956.
6. Foreign Currency transactions
Foreign currency transaction forward contracts are stated at the
forward contract rates while those not covered by forward contracts are
restated at the rates ruling at the end of the year, Exchange
differences relating to fixed assets are adjusted in the cost of the
assets. Any other exchange differences are dealt with in the Profit &
Loss A/a
7. Investments
Long term investments are stated at cost and provisions for diminution
in the value of long term investments are made only if such a decline
is other than temporary in the opinion of the management.
8. Retirement Benefits to Employees
i) Provident fund
The Companys contribution to provident fund and family pension fund is
charged to profit & loss account. The company has no further obligation
under Employees Provident fund Act,
ii) Gratuity
The company has taken a group policy for gratuity with Life Insurance
Corporation of India, The contribution on the basis of actuarial
valuation is charged to profit and loss account, The company has no
further obligation under Gratuity Act,
iii) Leave Encashment
The liability for leave encashment payable to employees is debited to
profit and loss account as calculated by the management,
9. Sales
Sales are accounted excluding excise duty, service tax and Central
sales fax (CST). Value Added Tax (VAT) collected on sales is accounted
separately in the VAT - input Credit Account,
10. Purchase
Purchase of raw material and components, testing material, consumable
stores are accounted excluding excise duty and Centra! Sales tax, Value
Added tax (VAT) paid on purchase is accounted separately in VAT - input
Credit Account,
11. Excise duty (Including Education Cess & Secondary & Higher
Secondary Education Cess)
The Excise duty is applicable to Raw Material and finished goods of the
company. The company is eligible for CENVAT credit for excise duty paid
on purchase of Raw material Components and Stores. The Balance of
CENVAT credit remained unavailed at the end of the year is eligible for
carry forward for the purpose of set-off against excise duty payable on
sales in subsequent year. The balance of CENVAT credit unavailed at the
end of the year is shown under "Excise Duty Receivable" under "Loans
and Advances" In the schedule of "Current Assets, Loans and Advances"
forming part of Balance Sheet.
12. Sales tax
a) The company Is eligible for Set off of Value Added tax paid on
purchases made from parties situated in the state of Gujarat as per the
Provision of Gujarat Value Added Tax Act, 2003. The amount eligible for
sales-tax set-off is accounted separately in VAT-lnput Credit Account
and not included In the purchases of the company.
b) Value Added Tax collected on sales and eligible for VAT set-off as
per the provision of Gujarat Value Added Tax Act 2003 and is accounted
separately in VAT- Input Credit Account and not included in the sales
of the company The Debit balance of VAT-lnput Credit Account represents
the excess of VAT paid on purchase over the VAT collected on sales and
is shown under "VAT Receivable" under "Loans and Advances" in the
schedule of "Current Assets, Loans and Advances" forming part of
Balance Sheet,
c) In respect of the factory of the company situated at Village:
Veraval (Shapar), Taluka; Kotda Sangani, District: Rajkot, Sales tax
collected under deferred payment scheme 1990-95 of State Government Rs,
209.04 lacs is required to be repaid in six equal installment
commencing from May-2004. The company has already paid Rs.209.04 lacs
and there is no balance Amount unpaid at the end of the year,
13. Service Tax
Service Tax on services availed and services provided are accounted
separately in Service Tax Account and set-off is claimed against Excise
Duty payable on Sales.
14. Inventories
i) Raw Material & Components
It is valued at Purchase cost excluding Central Excise Duty but
including Central Sales Tax other cost incurred to bring the inventory
to present condition and location. The Central Excise duty and Gujarat
Value Added Tax paid on purchase are not considered in the valuation of
inventories for the following reasons,
1) Purchases are accounted excluding Central Excise Duty and therefore,
if is not considered for valuation of Inventories.
2) As explained in para no, 12(a), the Value Added Tax paid on
purchases eligible for VAT set-off is accounted separately under VAT -
Input Credit Account, If is not included in purchases and therefore, it
is not considered for valuation of inventories.
II) Testing Material
It is valued at Purchase cost including Central Sales Tax and other
cost incurred to bring the inventory to present condition and location,
III) Consumable stores
At cost or net realizable value whichever is lower.
iv) Scrap / Plastic Packing Material for Captive Consumption At cost or
net realizable value whichever is lower,
v) Stock in Process
It is valued at Raw Material cost plus production cost incurred to
bring the inventory to present condition and location,
vi) Finished Goods
St is valued at selling rate,
The Finished Goods have been valued at selling price as the company
manufactures goods on customers order specification and thus the
finished goods at selling price reflects the realizable value, The
finished goods have to be valued c0 lower of cost or net realizable
value as per Accounting Standard (AS) - 2, Further, the quantum effect
of deviation on the net profit Is as under;
15. Research and Development
Expenditure relating to capital items is debited to fixed assets and
depreciated at applicable rates, Revenue expenditure is charged to
profit and loss account of the year,
16. Borrowing Costs
Borrowing costs that are attributable to the acquisition or
construction of assets are capitalized as part of cost of such assets.
All other borrowing costs are charged to revenue.
17. Income Tax
Provision for current tax is made on the basis of taxable income
computed in accordance with the Income Tax Act, 1961.
18. Deferred tax
Deferred tax is recognized on timing difference between taxable income
and accounting income that originate in one period and capable of
reversal in one or more subsequent periods, Deferred tax resulting from
"timing differences" is accounted for using tax rates and laws that
have been enacted or substantively enacted as on the balance sheet
date. The deferred tax assets is recognized and carried forward only to
the extent that there is a reasonable / virtual certainty that the
asset will be realized in future.
19. Contingent Liabilities
All liabilities have been provided for in the accounts except
liabilities of a contingent nature, which have been disclosed at their
estimated value in the Notes on Accounts.
20. Earning per share
The company reports basic and diluted Earning per share (EPS) in
accordance with Accounting standard (AS) - 20, Basic earning per share
is computed by dividing net profit for the year by the weighted average
number of shares outstanding during the period, Diluted earning per
share is computed by dividing net profit by the weighted shares
considered for deriving basic earning per share and also the weighted
average number of equity shares that could have been issued on the
conversion of all dilutive potential equity shares,