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Accounting Policies of Rubber Products Ltd. Company

Mar 31, 2015

A) Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles. The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and 2013, The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy as explained below;

b) 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 a material adjustment to the carrying amounts of assets or liabilities in future periods.

c) Sales (Revenue Recognition);

Sales include sales of products and services.

d) Fixed Assets and Depreciation:

Fixed Assets are stated at cost of acquisition, including any attributable cost for bringing the asset to its working condition for the intended use, less accumulated depreciation. Interest on borrowings attributable to new projects is capitalized and included in the cost of fixed assets as appropriate.

Depreciation is provided on the useful life of the Assets in accordance with the provisions of Section 205(2) of the companies act, 2013 at the rates applicable in Schedule II of the said act.

As regards determining life of all assets, same has been taken based on certificate issued by Apte and Associates, Chartered Engineers as per his certificate dated 13.07.2015 Original purchase cost and depreciation upto 31.03.2014 are taken from fixed assets register maintained by the company in XLS form and current year depreciation is determined on SLM basis on WDV as on 01.04.14 and based on remaining useful life of an assets determined and certified by Apte &' Associates

In case of Plant And Machinery, life of each component is determined from the year of addition irrespective of the life of main Machinery to which they were fixed or attached to in the absence of information and linkage thereof with the specific machinery. This work of linkage is under working and same will be incorporated in the next Balance sheet.

e. Inventories:

Raw materials at cost (FIFO basis) are on exclusive method, WIP & Finished Goods at cost.

f. Investments:

Investments that are readily realizable and intended to be held for not more than a year from the date on which such investment are made are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. However, provision for diminution in value is made to recognize a decline other than temporary in the value of such investments. Long-term investments are carried at cost.

g. Research and Development;

Recurring expenditure on Research and Development is charged to revenue.

h. Retirement benefits:

a) For provision for gratuity & Leave Encashment, there are no changes in Policy during the year.

b) Company's contribution to provident fund is charged to Profit & Loss Account.

i. Interest on Borrowings;

The interest on working capital is charged against the profits for the year in which it is incurred. -

j. Foreign Currency Transactions:

Foreign currency transactions are accounted at the exchange rates prevailing at the date of the transaction. Gains and losses resulting from the settlement of such transaction of monetary assets and liabilities denominated in foreign currencies are recognized in the Profit and Loss Account. Further monetary asset are not restated by applying the exchange rate as on 31s1 March, 2015

k. Taxes on income:

Current tax is determined as the amount of tax payable in aspect of taxable income for the period. Deferred Tax is recognized, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

l. Contingent liabilities:

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent ['lability but discloses its existence in the financial statements.






Mar 31, 2014

A) Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles. The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and 2013. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy as explained below:

Change in accounting policy

Inventory Valuation:

There is a change in method of valuation of inventory. The previous practice followed by the Company for the valuation of inventory i.e. valuation of Raw Materials on the basis of inclusive method. In the current financial year the company has followed the exclusive method i.e. excluding all taxes.

b) 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 a material adjustment to the carrying amounts of assets or liabilities in future periods.

c) Sales (Revenue Recognition): Sales include sales tax, premium on sale of import licence

d) Fixed Assets and Depreciation: Fixed Assets are stated at cost of acquisition, including any attributable cost for bringing the asset to its working condition for the intended use, less accumulated depreciation. Interest on borrowings attributable to new projects is capitalized and included in the cost of fixed assets as appropriate.

Depreciation is provided (except on the assets acquired up to 31.3.1983 where it is on written down value method) on straight line method in accordance with the provisions of Section 205(2) (b) of the Companies Act, 1956 at the rates specified in Schedule XIV of the said Act.

e) Inventories: Raw materials at cost (FIFO basis) are on exclusive method, WIP & Finished Goods at cost.

f) Investments investments that are readily realizable and intended to be held for not more than a year from the date on which such investment are made are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. However, provision for diminution in value is made to recognize a decline other than temporary in the value of such investments. Long-term investments are carried at cost.

g) Research and Development: Recurring expenditure on Research and Development is charged to revenue. h) Retirement benefits:

a) For provision for gratuity & Leave Encashment there are no changes in Policy during the year as mentioned earlier.

b) Company''s contribution to provident fund is. charged to Profit & Loss Account.

i) Interest on Borrowings: The interest on working capital is charged against the profits for the year in which it is incurred.

j) Foreign Currency Transactions: Foreign currency transactions are accounted at the exchange rates prevailing at the date of the transaction. Gains and losses resulting from the settlement of such transaction of monetary assets and liabilities denominated in foreign currencies are recognized in the Profit and Loss Account. Further monetary asset are not restated by applying the exchange rate as on 31st March, 2014.

k) Taxes on Income: Current tax is determined as the amount of tax payable in respect of taxable income for the period. Deferred Tax is recognized, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

I) Contingent liabilities: A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.

3. (a) Consistent with the past practice, no provision has been made for excise duty estimated at Rs. 6.24.468/- (Previous Year Rs. 7,40,235/-) on stock lying at the year end. Accordingly the said amounts are not included in the inventory valuation. This has no effect on the profit for the year. Though the said accounting treatment differs from the revised "Guidance Note on Accounting treatment for Excise Duty " issued by the ICAI.

(b) As compared to the previous practice followed by the company for the valuation of raw material on the basis of inclusive method, the management now decided to follow the exclusive method of valuation of raw material i.e. without taking into all taxes, Consequently it impact on closing stock is determined by company which comes to Rs. 7.00 Lacs (Write in Bold figures). However on opening stock it''s impact is not determined by a company.


Mar 31, 2011

(a) Basis of Accounting:

The Financial statements are prepared under the historical cost convention and comply in all materials aspects with the applicable accounting principles in India. Accounting standards notified under sub-section 3C of section 211 of the Companies Act, 1956 and the other relevant provisions of the Companies Act, 1956

(b) Sales (Revenue Recognition):

Sales include Excise Duty, Sales Tax, Premium on Sale of import licence, Sale of scrap and exchange difference arising on Sale transactions.

(c) Fixed Assets & Depreciation:

Fixed Assets are stated at cost of acquisition, including any attributable cost or bringing the asset to its working condition for the intended use, less accumulated depreciation, interest on borrowings attributable to new projects is capitalized and included in the cost of fixed assets as appropriate. Depreciation is provided (Except on the Assets acquired upto 31.3.1983 where it is on written down value method) on straight line method in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956 at the rates specified in Schedule XIV of the said Act.

(d) Inventories:

Raw materials at Cost (FIFO basis) on inclusive method, WIP & Finished Goods at cost.

(e) Investments:

Long term Quoted investments are stated at cost. Unquoted long term investments are valued at cost

(f) Research and Development:

Recurring expenditure on Research and Development is charged to revenue.

(g) Retirements benefits:

a) Liability for Gratuity is funded by annual payment to Life Insurance Corporation of India on the basis of valuation as advised by LIC. Provision is also made for the difference in net present value of Liability and value of fund as at year end.

b) Provision is made for Liability towards Leave Encashment estimated on the basis of accumulated leave, employee's salary and other relevant factors.

c) Company's contribution to provident fund is charged to Profit & Loss Account.

(h) Interest on Borrowings:

The interest on working capital is charged against the profits for the year in which it is incurred. Interest on borrowings for capital assets is capitalized till the date of commencement of commercial use of the asset.

(i) Foreign Currency Transaction:

Foreign currency transactions are accounted at the exchange rates prevailing at the date of the transaction, Gains and losses resulting from the settlement of such transaction of monetary assets and liabilities denominated in foreign currencies, are recognized in the Profit and Loss account.

(j) Taxes on Income:

Current tax is determined as the amount of tax payable in respect of taxable income for the period. Deferred Tax is recognized, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.


Mar 31, 2010

(a) Basis of Accounting: The Financial statements are prepared under the historical cost convention and comply in all materials aspects with the applicable accounting principles in India, accounting standards notified under sub-section (3C) of Section 211 of the Companies Act, 1956 and the other relevant provisions of the Companies Act, 1956.

(b) Sales (Revenue Recognition): Sales include excise duty, sales tax, premium on sale of import licence, sale of scrap and exchange difference arising on sale transactions.

(c) Fixed Assets and Depreciation: Fixed Assets are stated at cost of acquisition, including any attributable cost for bringing the asset to its working condition for the intended use, less accumulated depreciation. Interest on borrowings attributable to new projects is capitalized and included in the cost of fixed assets as appropriate.

Depreciation is provided (except on the assets acquired up to 31.3.1983 where it is on written down value method) on straight line method in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956 at the rates specified in Schedule XIV of the said Act.

(d) Inventories: Raw materials at cost (FIFO basis) on inclusive method, WIP & Finished Goods at cost.

(e) Investments: Long term quoted investments are stated at cost. Unquoted long term investments are valued at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the quoted investments.

(f) Research and Development: Recurring expenditure on Research and Development is charged to revenue.

(g) Retirement benefits:

a) Liability for gratuity is funded by annual payment to Life Insurance Corporation of India on the basis of valuation as advised by LIC. Provision is also made for the difference in net present value of liability and value of fund as at year end.

b) Provision is made for liability towards Leave Encashment estimated on the basis of accumulated leave, employees salary and other relevant factors.

c) Companys contribution to provident fund is charged to Profit & Loss Account.

(h) Interest on Borrowings: The interest on working capital is charged against the profits for the year in which it is incurred. Interest on borrowings for capital assets is capitalised till the date of commencement of commercial use of the asset.

(i) Foreign Currency Transactions: Foreign currency transactions are accounted at the exchange rates prevailing at the date of the transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies, are recognized in the Profit and Loss Account.

(j) Taxes on Income: Current tax is determined as the amount of tax payable in respect of taxable income for the period. Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

 
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