Mar 31, 2015
1 Background
RCL Foods Limited was originally Incorporated on 02.11.1992 in the
State of Orissa in the name and style of 'Passari cellulose Private
Limited' which was subsequently changed to "RCL Foods Limited" on
04.08.2010 having its registered office in Chennai. The Company is
engaged in the business of manufacturing and trading of food and
processed foods.
a) Basis of preparation of financial statements
The financial statements have been prepared and presented under the
historical cost convention, on the accrual basis of accounting in
accordance with the generally accepted accounting principles ('GAAP')
in India and comply with the Accounting Standards notified by the
Central Government pursuant to Companies (Accounting Standard) Rules,
2006, other pronouncements of the Institute of Chartered Accountants of
India (ICAI) and the relevant provisions of the Companies Act, 1956, to
the extent applicable.
b) Use of estimates
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, revenue and expenses,
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the period reported. Actual results could differ from these
estimates. Any revision to accounting estimates is recognized
prospectively in the current and future periods.
c) Revenue recognition
"Revenue from sale of goods is recognized on dispatch of goods to
customers which corresponds with transfer of all significant risks and
rewards of ownership to the buyer. The amount recognized as sale is
exclusive of sales tax, trade and quantity discounts. Dividend income
is recognized when unconditional right to receive the payment is
established. Interest income on deposits and interest bearing
securities is recognized on the time proportionate method.
c) Tangible fixed assets and depreciation
Tangible fixed Assets are stated at cost of acquisition less
accumulated depreciation. The cost of tangible fixed assets includes
freight, duties and taxes and other incidental expenses related to the
acquisition, but exclude duties and taxes that are recoverable
subsequently from tax authorities. Borrowing costs directly
attributable to acquisition of those fixed assets which necessarily
take a substantial period of time to get ready for their intended use
are capitalized.
Depreciation on fixed assets is provided on written down value method
in accordance with Schedule II to the Companies Act, 2013 . If the
management's estimates of the useful life of a fixed asset at the time
of acquisition of the asset or of the remaining useful life on a
subsequent review is shorter than that envisaged in the aforesaid
Schedule, depreciation is provided at a higher rate based on the
management estimate of useful life/ remaining useful life. However as
of date, the management has not estimated the useful life of the assets
to be shorter than that envisaged in the aforesaid schedule.
d) Intangible assets and amortization
Intangible fixed assets are recorded at the consideration paid for
acquisition. Intangible assets are amortized over their estimated
economic useful lives on a straight line basis commencing from the date
the
e) Borrowing costs
Borrowing cost comprising interest and finance charges directly
attributable to the construction of qualifying assets are capitalized
as part of the cost of that asset until the activities necessary to
prepare the qualifying asset for its intended use are complete. Other
borrowing costs are recognized as an expense in the period in which
they are incurred.
f) 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 (higher of net
realizable value and value in use) 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 the carrying amount, the
carrying amount is reduced to its recoverable amount. The reduction is
treated as an impairment loss and is recognized in the profit and loss
account. If at the balance sheet date there is an indication that 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 depreciable historical cost.
g) Inventories
Inventories are valued at the lower of cost and net realizable value.
Cost of inventories comprises all cost of purchase, cost of conversion
and other costs incurred in bringing the inventories to their present
location and condition. Cost includes all taxes and duties, but
excludes duties and taxes that are subsequently recoverable from tax
authorities.
h) Foreign currency transactions
Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of the transactions or rates that approximates
the exchange rate prevailing at the date of the transactions. Monetary
assets and liabilities denominated in foreign currencies' as at the
balance sheet date are translated at the closing exchange rates on that
date. Exchange differences arising on foreign exchange transactions
during the year and on restatement of monetary assets and liabilities
are recognized in the statement of profit and loss account of the year.
i) Employee benefit
Defined benefit plan
j) Gratuity: The Company provides for gratuity, a defined benefit
retirement Plan (the "Gratuity Plan") covering eligible employees. The
Plan provides payment to vested employees at retirement, death or
termination of employment, of an amount based on the respective
employee's salary and the tenure of employment with the Company.
Liabilities related to the Gratuity Plan are determined by actuarial
valuation done by an independent actuary using projected unit credit
method as at March 31 each year.
Actuarial gains and losses in respect of post employment and other
long-term benefits are charged to the Profit and Loss Account.
ii) Compensated absences: Provision for long term compensated absences
is made on the basis of an actuarial valuation as at the balance sheet
date carried out by an independent actuary using projected unit credit
method. Provision for short term compensated absences is made on actual
liability basis.
k) Income taxes
Income-tax expense comprise current tax (i.e. amount of tax for the
period determined in accordance with the income-tax law), and deferred
tax charge or credit (reflecting that tax effects of timing differences
between accounting income and taxable income for the period). The
deferred tax charge or credit and the corresponding deferred tax
liabilities or assets are recognized using the tax rates and tax laws
that have been enacted or substantively enacted by the balance sheet
date. Deferred tax assets are recognized only to the extent there is a
reasonable certainty that the assets can be realized in future;
however, where there is unabsorbed depreciation or carried forward loss
under taxation laws, deferred tax assets are recognized only if there
is a virtual certainty of realization of such assets. Deferred tax
assets are reviewed as at the balance sheet date and written down or
written up to reflect the amount that is reasonably/virtually certain
(as the case may be) to be realized. Current tax and deferred tax
assets and liabilities are offset to the extent to which the Company
has a legally enforceable right to set off and they relate to taxes on
income levied by the same governing taxation laws.
I) Earnings per share
Basic earnings per share is computed by dividing net profit or loss for
the period attributable to equity shareholders by the weighted average
number of shares outstanding during the year. Diluted earnings per
share amounts are computed after adjusting the effects of all dilutive
potential equity shares. The number of shares used in computing diluted
earnings per share comprises the weighted average number of shares
considered for deriving basic earnings per share, and also the weighted
average number of equity shares, which could have been issued on the
conversion of all dilutive potential shares. The diluted potential
equity shares are adjusted for the proceeds receivable, had the shares
been actually issued at fair value (i.e. the average market value of
the outstanding shares). Dilutive potential equity shares are deemed
converted as of the beginning of the period, unless issued at a later
date.
m) Cash flow statements
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
nature and any deferrals or accruals of past or future cash receipts or
payments. The cash flows from regular revenue generating, financing
and investing activities of the Company are segregated. Cash flows in
foreign currencies are accounted at average monthly exchange rates that
approximate the actual rates of exchange prevailing at the dates of the
transactions.
n) Provisions, contingent liabilities and contingent assets
The Company creates a provision when there is present obligation as a
result of past event that probably requires an outflow of resources and
a reliable estimate can be made of the amount of the obligation. A
disclosure for a contingent liability is made when there is a possible
obligation or a present obligation that may, but probably will not,
require an outflow of resources. Where there is a possible obligation
or a present obligation in respect of which the likelihood of outflow
of resources is remote, no provision or disclosure is made. Contingent
assets are neither recognized nor disclosed in the financial
statements.
o) Investments:
Long-term investments are stated at cost less any other-than-temporary
diminution in value, determined separately for each individual
investment. Current investments are carried at the lower of cost and
fair value.
Mar 31, 2014
A) Basis of preparation of financial statements
The financial statements have been prepared and presented under the
historical cost convention, on the accrual basis of accounting in
accordance with the generally accepted accounting principles (''GAAP'')
in India and comply with the Accounting Standards notified by the
Central Government pursuant to Companies (Accounting Standard) Rules,
2006, other pronouncements of the Institute of Chartered Accountants of
India (ICAI) and the relevant provisions of the Companies Act, 1956, to
the extent applicable.
b) Use of estimates
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, revenue and expenses,
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the period reported. Actual results could differ from these
estimates. Any revision to accounting estimates is recognized
prospectively in the current and future periods.
c) Revenue recognition
Revenue from sale of goods is recognised on despatch of goods to
customers which corresponds with transfer of all significant risks and
rewards of ownership to the buyer. The amount recognized as sale is
exclusive of sales tax, trade and quantity discounts.
Dividend income is recognized when unconditional right to receive the
payment is established.
Interest income on deposits and interest bearing securities is
recognized on the time proportionate method.
c) Tangible fixed assets and depreciation
Tangible fixed Assets are stated at cost of acquisition less
accumulated depreciation. The cost of tangible fixed assets includes
freight, duties and taxes and other incidental expenses related to the
acquisition, but exclude duties and taxes that are recoverable
subsequently from tax authorities. Borrowing costs directly
attributable to acquisition of those fixed assets which necessarily
take a substantial period of time to get ready for their intended use
are capitalized.
Advances paid towards acquisition of tangible fixed assets and the cost
of assets not ready to be put to use before the year end are disclosed
under long term loans and advances and capital work in progress
respectively.
Depreciation on fixed assets is provided on written down value method.
The rates of depreciation prescribed in Schedule XIV to the Companies
Act, 1956 are considered as the minimum rates. If the management''s
estimates of the useful life of a fixed asset at the time of
acquisition of the asset or of the remaining useful life on a
subsequent review is shorter than that envisaged in the aforesaid
Schedule, depreciation is provided at a higher rate based on the
management estimate of useful life/ remaining useful life. Accordingly,
the rates of depreciation for various assets are as under:
Fixed Assets Rate of Depreciation
Computers 40.00%
Furniture and fittings 18.10%
Vehicles 25.89%
Office equipments 13.91%
Plant and machinery 13.91%
All individual assets costing Rs 5,000 or less are depreciated at 100%
in the year of purchase.
d) Intangible assets and amortisation
Intangible fixed assets are recorded at the consideration paid for
acquisition. Intangible assets are amortized over their estimated
economic useful lives on a straight line basis commencing from the date
the asset is available for its use. The management estimates the useful
lives for the various intangible assets as follows:
Description Estimated useful life (in years)
Software 3
e) Borrowing costs
Borrowing cost comprising interest and finance charges directly
attributable to the construction of qualifying assets are capitalized
as part of the cost of that asset until the activities necessary to
prepare the qualifying asset for its intended use are complete. Other
borrowing costs are recognized as an expense in the period in which
they are incurred.
f) 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 (higher of net
realizable value and value in use) 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 the carrying amount, the
carrying amount is reduced to its recoverable amount. The reduction is
treated as an impairment loss and is recognized in the profit and loss
account. If at the balance sheet date there is an indication that 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 depreciable historical cost.
g) Inventories
Inventories are valued at the lower of cost and net realizable value.
Cost of inventories comprises all cost of purchase, cost of conversion
and other costs incurred in bringing the inventories to their present
location and condition. Cost includes all taxes and duties, but
excludes duties and taxes that are subsequently recoverable from tax
authorities.
h) Foreign currency transactions
Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of the transactions or rates that approximates
the exchange rate prevailing at the date of the transactions. Monetary
assets and liabilities denominated in foreign currencies as at the
balance sheet date are translated at the closing exchange rates on that
date. Exchange differences arising on foreign exchange transactions
during the year and on restatement of monetary assets and liabilities
are recognized in the statement of profit and loss account of the year.
i) Operating lease
Lease payments under operating lease are recognised as an expense on
straight line basis over the lease term.
j) Employee benefit
Defined benefit plan
i) Gratuity: The Company provides for gratuity, a defined benefit
retirement Plan (the "Gratuity Plan") covering eligible employees. The
Plan provides payment to vested employees at retirement, death or
termination of employment, of an amount based on the respective
employee''s salary and the tenure of employment with the Company.
Liabilities related to the Gratuity Plan are determined by actuarial
valuation done by an independent actuary using projected unit credit
method as at March 31 each year.
Actuarial gains and losses in respect of post employment and other
long-term benefits are charged to the Profit and Loss Account.
ii) Compensated absences: Provision for long term compensated absences
is made on the basis of an actuarial valuation as at the balance sheet
date carried out by an independent actuary using projected unit credit
method. Provision for short term compensated absences is made on actual
liability basis.
k) Income taxes
Income-tax expense comprise current tax (i.e. amount of tax for the
period determined in accordance with the income-tax law), and deferred
tax charge or credit (reflecting that tax effects of timing differences
between accounting income and taxable income for the period). The
deferred tax charge or credit and the corresponding deferred tax
liabilities or assets are recognized using the tax rates and tax laws
that have been enacted or substantively enacted by the balance sheet
date. Deferred tax assets are recognized only to the extent there is a
reasonable certainty that the assets can be realized in future;
however, where there is unabsorbed depreciation or carried forward loss
under taxation laws, deferred tax assets are recognized only if there
is a virtual certainty of realization of such assets. Deferred tax
assets are reviewed as at the balance sheet date and written down or
written up to reflect the amount that is reasonably/virtually certain
(as the case may be) to be realized. Current tax and deferred tax
assets and liabilities are offset to the extent to which the Company
has a legally enforceable right to set off and they relate to taxes on
income levied by the same governing taxation laws.
l) Earnings per share
Basic earnings per share is computed by dividing net profit or loss for
the period attributable to equity shareholders by the weighted average
number of shares outstanding during the year. Diluted earnings per
share amounts are computed after adjusting the effects of all dilutive
potential equity shares. The number of shares used in computing diluted
earnings per share comprises the weighted average number of shares
considered for deriving basic earnings per share, and also the weighted
average number of equity shares, which could have been issued on the
conversion of all dilutive potential shares. The diluted potential
equity shares are adjusted for the proceeds receivable, had the shares
been actually issued at fair value (i.e. the average market value of
the outstanding shares). Dilutive potential equity shares are deemed
converted as of the beginning of the period, unless issued at a later
date.
m) Cash flow statements
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non- cash
nature and any deferrals or accruals of past or future cash receipts or
payments. The cash flows from regular revenue generating, financing and
investing activities of the Company are segregated. Cash flows in
foreign currencies are accounted at average monthly exchange rates that
approximate the actual rates of exchange prevailing at the dates of the
transactions.
n) Provisions, contingent liabilities and contingent assets
The Company creates a provision when there is present obligation as a
result of past event that probably requires an outflow of resources and
a reliable estimate can be made of the amount of the obligation. A
disclosure for a contingent liability is made when there is a possible
obligation or a present obligation that may, but probably will not,
require an outflow of resources. Where there is a possible obligation
or a present obligation in respect of which the likelihood of outflow
of resources is remote, no provision or disclosure is made. Contingent
assets are neither recognised nor disclosed in the financial
statements.
o) Investments:
Long-term investments are stated at cost less any other -than
-temporary diminution in value, determined separately for each
individual investment. Current investments are carried at the lower of
cost and fair value.
Mar 31, 2012
A. Basis of Preparation of Financial Statements :
The Financial Statements of the Company havae been prepared in
accordance with the Generally Accepted Accouting Policies in India to
comply with the Accounting Standards notified under the Companies
(Accounting Standards) Rules, 2006 (as amended) and the relevant
provisions of theCompanies Act, 1956. The financial statements have
been prepared on accrual basis under the historical cost convention.
The accounting policies adopted in the preparation of the financial
statements are consistent with those followed in the previous year.
B. Fixed Assets :
Fixed Assets are stated at Cost less accumulated depreciation and
impairment losses, if any.
C. Intangible Assets :
Intangible Assets are stated at Cost less accumulated
amortisation/depletion.
D. Depreciation and Amortisation :
Depreciation on fixed assets is provided to the extent of depreciable
amount on written down value method at the rates and in the manner
prescribed in Schedule XIV to the Companies Act, 1956.
E. Cash flow Statement
Cash flows are reported using the indirect method, whereby
profit/(Loss) before extraordinaryitems and tax is adjusted for the
effects of transactions of non cash nature and any deferrals or
accruals of past or future cash receipts or payments. The cash flows
from operating, investingand financing activities of the Company are
segregated based on the available information.
F. Inventories :
i) Packing Materials are valued at cost and net realisable value.
ii) Raw Materials are valued at cost.
ii) Finished Goods/Traded Goods are valued at lower of cost or market
price.
G. Accounting for Investments
Investments are stated at cost. Provision for diminution in value is
made only if such a declineis other than temporary in the opinion of
the management. A diminution in the value of investmentto the extent of
Rs.106360/- is made in the books of accounts.
H. Gratuity :
Provision for Gratuity Liability to employees is made on the basis of
actuarial valuation.
I. Provision for Current and Deferred Tax :
Provision for Current tax is made after taking into consideration
benefits admissible under theprovisions of the Income Tax Act, 1961.
Deferred tax resulting from Ãtiming differenceà between taxable and
accounting income is accounted for using the tax rates and laws that
are enacted as on the balance sheet date. Deferred tax asset is
recognised and carried forward only to the extent that there is virtual
certainty that the asset will be realised in future.
Mar 31, 2011
I) Basis of Accounting:
The Company maintains accounts under the historical cost convention
accounts on accrual basis as a going concern and in accordance with the
Accounting Standards issued by the Institute of Chartered Accountants
of India and as per the provisions of the Companies Act, 1956.
ii) Income & Expenditure Recognition:
All items of Income and Expenditure are accounted for on Accrual basis.
iii) Use of Estimates :
The preparation of the financial statements in conformity with the
generally accepted accounting principles required estimates an
assumption to be made that affect the reported amount of assets and
liabilities on the date of financial statement and the reported amount
of revenues and expenses during the reporting period. Differences
between actual results and estimates are recognized in the period in
which the results are known /materialised.
iv) Fixed Assets:
All fixed assets are stated at cost less accumulated depreciation.
Cost of Fixed Assets includes all duties and taxes and all expenses
incurred up to erection and
installation but net of tax credit recoverable from tax authorities,
wherever applicable.
v) Depreciation
Depreciation has been provided on ÃWritten Down Value Methodà in
accordance with the rates specified in Schedule XIV to the Companies
Act, 1956. Depreciation on additions/sale are calculated on pro rata
basis from the date of additions or up to the date of sale, as the case
may be.
vi). Investments:
Long term Investments are stated at cost. Provision for diminution in
value is made, if the decline is other than temporary in nature.
Current Investments are stated at lower of cost or fair value
determined on the basis of each category of Investments.
vii) Accounting of Employee Benefits:
Defined benefit plan: The liability for Gratuity to employees as at
Balance Sheet date is determined on the basis of Actuarial Valuation
based on Projected Unit Credit Method.
viii) Liability Recognition:
Provision is made in the accounts in respect of all liabilities
relating to the period under review, which have material effect on the
position stated in the Balance Sheet.
ix)Taxation:
(i) Provision for current Income Tax is made in accordance with the
Income Tax Act, 1961.
(ii) Provision for deffered tax is made for timing differences arising
between taxable income and accounting income computed using tax rates
and laws that have been enacted or substantially enacted as of balance
sheet date. Deferred Tax Liability/Asset are recognized, subject to
consideration of prudence, timing difference and materiality.
(iii) Deferred tax asset are recognized only if there is virtual
certainty that they will be realized and reviewed for appropriateness
of their carrying values at each balance sheet date.
x) Miscellaneous Expenditure:
Preliminary Expenses is being amortized over a period of 5 years.
Mar 31, 2010
I) Basis of Accounting:
The Company maintains accounts under the historical cost convention
accounts on accrual basis as a going concern and in accordance with the
Accounting Standards issued by the Institute of Chartered Accountants
of India and as per the provisions of the Companies Act, 1956.
ii) Income & Expenditure Recognition:
All items of Income and Expenditure are accounted for on Accrual basis.
iii) Use of Estimates :
The preparation of the financial statements in conformity with the
generally accepted accounting principles required estimates an
assumption to be made that affect the reported amount of assets and
liabilities on the date of financial statement and the reported amount
of revenues and expenses during the reporting period. Differences
between actual results and estimates are recognized in the period in
which the results are known /materialised.
iv) Fixed Assets:
All fixed assets are stated at cost less accumulated depreciation.
Cost of Fixed Assets includes all duties and taxes and all expenses
incurred up to erection and
installation but net of tax credit recoverable from tax authorities,
wherever applicable.
v) Depreciation
Depreciation has been provided on "Written Down Value Method" in
accordance with the rates specified in Schedule XIV to the Companies
Act, 1956. Depreciation on additions/sale are calculated on pro rata
basis from the date of additions or up to the date of sale, as the case
may be.
vi). Investments:
Long term Investments are stated at cost. Provision for diminution in
value is made, if the decline is other than temporary in nature.
Current Investments are stated at lower of cost or fair value
determined on the basis of each category of Investments.
vii) Accounting of Employee Benefits:
Defined benefit plan: The liability for Gratuity to employees as at
Balance Sheet date is determined on the basis of Actuarial Valuation
based on Projected Unit Credit Method.
viii) Liability Recognition:
Provision is made in the accounts in respect of all liabilities
relating to the period under review, which have material effect on the
position stated in the Balance Sheet.
ix)Taxation:
(i) Provision for current Income Tax is made in accordance with the
Income Tax Act, 1961.
(ii) Provision for deferred tax is made for timing differences arising
between taxable income and accounting income computed using tax rates
and laws that have been enacted or
substantially enacted as of balance sheet date. Deferred Tax
Liability/Asset are recognized, subject to consideration of prudence,
timing difference and materiality.
(iii) Deferred tax asset are recognized only if there is virtual
certainty that they will be realized and reviewed for appropriateness
of their carrying values at each balance sheet date.
x) Miscellaneous Expenditure:
Preliminary Expenses is being amortized over a period of 5 years.
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