Home  »  Company  »  Shree Raj.Syntex  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Shree Rajasthan Syntex Ltd. Company

Mar 31, 2015

I) FIXED ASSETS AND DEPRECIATION:

a) Fixed Assets are stated at cost, net of Cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalised. Stores and spares received along with the Plant & Machinery are being capitalised with related machine.

b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without availing CENVAT, and thermal power plant is stated without availing service cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalized.

c) Depreciation on fixed assets is provided on straight line method as per useful life prescribed in Schedule II to the Companies Act, 2013. Depreciation on incremental cost, arising on account of conversion difference of foreign currency liabilities for acquisition of fixed assets and stand by equipments , which are amortised over the residual life of the respective assets.

d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are fully depreciated.

e) The company provides for depreciation on following plant & machinery considering the same as continuous process plant.

(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn Division

(ii) Power Generation Equipments

f) Free hold lands and leasehold lands are not depreciated.

g) Impairment of Assets - If the carrying amount of fixed assets exceeds the recoverable amount on the reporting date, the carrying amount is reduced to the recoverable amount. The recoverable amount is measured as the highest of the net selling price and the value in use determined by the present value of estimated future cash flows.

ii) INVENTORIES:

Inventories are valued at cost or net realisable value which ever is lower. Historical cost has been determined as under:-

A Raw Materials At Batch cost.

B Stores, Spares At First In First Out method.

C Fuel Monthly weighted average

D Work-in-progress

(i) Preparatory Stage - at cost

(ii) Yarn Stage-at cost or net realizable value whichever is lower.

E Finished goods at cost or net realizable value whichever is lower.

[Cost formula used in clause (D) & (E): - Conversion cost and other cost in bringing the inventories to their present location and condition.]

F Waste and Scrap at net realisable value.

G Trading stocks at cost of purchase

iii) INVESTMENTS:

Long term investments are carried at cost including related expenses. In case of diminution in value other than temporary, the carrying amount is reduced to recognize the decline cost.

iv) RAW MATERIAL CONSUMPTION IS NET OF EXPORT BENEFITS.

v) RESEARCH AND DEVELOPMENT:

Research and development costs (other than costs of fixed assets acquired) are charged as an expense in the year in which they are incurred.

vi) EMPLOYEE BENEFITS:

Short-term employee benefits (benefits which are payable within twelve months after the end of the period in which the employees render service ) are measured at cost. Long -term employee benefits ( benefits which are payable after the end of twelve months from the end of the period in which the employees render service ) and post employment benefits ( benefits which are payable after completion of employment ) are measured on a discounted basis by the Projected Unit Credit Method on the basis of annual third party actuarial valuations.

Contributions to Provident Fund , a defined contribution plan are made in accordance with the statute , and are recognized as an expense when employees have rendered service entitling them to the contributions.

The costs of providing leave encashment and gratuity, defined benefit plans, are determined using the Projected Unit Credit Method , on the basis of actuarial valuations carried out by third party actuaries at each balance sheet date. The leave encashment and gratuity benefit obligation recognized in the Balance Sheet represents the present value of the obligations as reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to the discounted value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan. Actuarial gains and losses are recognized immediately in the Profit and Loss Account.

vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:

Preliminary, Capital issue expenses are amortised in a period of ten years. Upfront payment made for reduction in rate of interest and for fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue Expenses) are amortised in a period of five years.

viii) REVENUE RECOGNITION:

(a) The accounts of the company are prepared under the historical cost convention and in accordance with the applicable accounting standards.

(b) Income is accounted for on accrual basis in accordance with Accounting Standard (AS) 9-"Revenue Recognition" which provides that where there is no reasonable certainty, the recognition of income be postponed.

(c) Excise Duty is recognized on dispatches to parties except consignment agents.

(d) Claims lodged with insurance companies and others are recognised in accounts to the extent they are measurable with reasonable certainty of acceptance. Excess/Shortfall is adjusted in the year of receipt.

ix) CENVAT:

a. CENVAT claimed on capital goods (Plant and Machinery), except for Plant and Machinery of Cotton Yarn Division and Service tax cenvat on plant & machinery of Wartsila Power Division, is credited to Plant and Machinery cost. Depreciation is not charged on the CENVAT claimed on capital goods in the books of account as well as under the Income Tax Act.

b. CENVAT on purchases of such inputs are deducted from the cost, wherever the excise duty has been paid on finished goods manufactured out of these inputs.

x) FOREIGN CURRENCY TRANSACTION:

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. 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 contract.

c. Non monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss Account except incase of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

xi) EXPORT BENEFITS:

Export benefits on Export are recognized in accounts to the extent they are measurable with reasonable certainty.

Excess/Shortfall is adjusted in the year of receipt.

xii) PROVISIONS AND CONTINGENT LIABILITIES: a. Provisions are made when the present obligation of a past event gives rise to probable outflow, embodying economic benefit on settlement and the amount of obligation can be reliably estimated.

b. Contingent Liabilities are disclosed after a careful evaluation of facts and legal aspects of the matter involved.

c. Provisions and Contingent Liabilities are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

xiii) TAXATION:

Provision for current tax is made in accordance with the provisions of the Income Tax Act, 1961. Deferred tax on account of timing difference between taxable and accounting income is provided considering the tax rates and tax laws enacted or substantially enacted by the Balance Sheet date in accordance with Accounting Standard 22 as notified by the regulatory authorities.

xiv) EXCISE DUTY:

Excise duty on manufactured goods wherever applicable is accounted for at the point of manufacture of goods and accordingly, is considered for valuation of finished goods stock lying in the factories as on the Balance Sheet date.


Mar 31, 2014

I) FIXED ASSETS AND DEPRECIATION:

a) Fixed Assets are stated at cost, net of Cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalised. Stores and spares received along with the Plant & Machinery are being capitalised with related machine.

b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without availing CENVAT, and thermal power plant is stated without availing service cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalized.

c) Depreciation on fixed assets is provided on straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 as amended except depreciation on incremental cost, arising on account of conversion difference of foreign currency liabilities for acquisition of fixed assets and stand by equipments , which are amortised over the residual life of the respective assets.

d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are fully depreciated.

e) The company provides for depreciation on following plant & machinery considering the same as continuous process plant.

(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn Division

(ii) Power Generation Equipments

f) Free hold lands and leasehold lands are not depreciated.

g) Impairment of Assets : If the carrying amount of fixed assets exceeds the recoverable amount on the reporting date, the carrying amount is reduced to the recoverable amount. The recoverable amount is measured as the highest of the net selling price and the value in use determined by the present value of estimated future cash flows.

ii) INVENTORIES: Inventories are valued at cost or net realisable value which ever is lower. Historical cost has been determined as under :-

A Raw Materials At Batch cost.

B Stores, Spares At moving weighted average cost.

C Fuel Monthly weighted average

D Work-in-progress

(i) Preparatory Stage – at cost

(ii) Yarn Stage-at cost or net realizable value whichever is lower.

E Finished goods at cost or net realizable value whichever is lower.

[Cost formula used in clause (D) & (E): – Conversion cost and other cost in bringing the inventories to their present location and condition.]

F Waste and Scrap at net realisable value.

G Trading stocks at cost of purchase

iii) INVESTMENTS: Long term investments are carried at cost including related expenses. In case of diminution in value other than temporary, the carrying amount is reduced to recognize the decline cost.

iv) Raw Material consumption is net of Export benefits.

v) RESEARCH AND DEVELOPMENT: Research and development costs (other than costs of fixed assets acquired) are charged as an expense in the year in which they are incurred.

vi) EMPLOYEE BENEFITS:

Short-term employee benefits (benefits which are payable within twelve months after the end of the period in which the employees render service) are measured at cost. Long -term employee benefits (benefits which are payable after the end of twelve months from the end of the period in which the employees render service) and post employment benefits (benefits which are payable after completion of employment) are measured on a discounted basis by the Projected Unit Credit Method on the basis of annual third party actuarial valuations.

Contributions to Provident Fund, a defined contribution plan are made in accordance with the statute, and are recognized as an expense when employees have rendered service entitling them to the contributions.

The costs of providing leave encashment and gratuity, defined benefit plans, are determined using the Projected Unit Credit Method, on the basis of actuarial valuations carried out by third party actuaries at each balance sheet date. The leave encashment and gratuity benefit obligation recognized in the Balance Sheet represents the present value of the obligations as reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to the discounted value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan. Actuarial gains and losses are recognized immediately in the Profit and Loss Account.

vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:

Preliminary, Capital issue expenses are amortised in a period of ten years. Upfront payment made for reduction in rate of interest and for fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue Expenses) are amortised in a period of five years.

viii) REVENUE RECOGNITION:

(a) The accounts of the company are prepared under the historical cost convention and in accordance with the applicable accounting standards.

(b) Income is accounted for on accrual basis in accordance with Accounting Standard (AS) 9-"Revenue Recognition" which provides that where there is no reasonable certainty, the recognition of income be postponed.

(c) Excise Duty is recognized on dispatches to parties except consignment agents.

(d) Claims lodged with insurance companies and others are recognised in accounts to the extent they are measurable with reasonable certainty of acceptance. Excess/Shortfall is adjusted in the year of receipt.

ix) CENVAT

a. CENVAT claimed on capital goods (Plant and Machinery), except for Plant and Machinery of Cotton Yarn Division and Service tax cenvat on plant & machinery of Wartsila Power Division, is credited to Plant and Machinery cost. Depreciation is not charged on the CENVAT claimed on capital goods in the books of account as well as under the Income Tax Act.

b. CENVAT on purchases of such inputs are deducted from the cost, wherever the excise duty has been paid on finished goods manufactured out of these inputs.

x) FOREIGN CURRENCY TRANSACTION –

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. 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 contract.

c. Non monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss Account except incase of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

xi) EXPORT BENEFITS – Export benefits on Export are recognized in accounts to the extent they are measurable with reasonable certainty. Excess/Shortfall is adjusted in the year of receipt.

xii) PROVISIONS AND CONTINGENT LIABILITIES –

a. Provisions are made when the present obligation of a past event gives rise to probable outflow, embodying economic benefit on settlement and the amount of obligation can be reliably estimated.

b. Contingent Liabilities are disclosed after a careful evaluation of facts and legal aspects of the matter involved

c. Provisions and Contingent Liabilities are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

xiii) TAXATION :

Provision for current tax is made in accordance with the provisions of the Income Tax Act, 1961. Deferred tax on account of timing difference between taxable and accounting income is provided considering the tax rates and tax laws enacted or substantially enacted by the Balance Sheet date in accordance with Accounting Standard 22 as notified by the regulatory authorities.

xiv) EXCISE DUTY :

Excise duty on manufactured goods wherever applicable is accounted for at the point of manufacture of goods and accordingly, is considered for valuation of finished goods stock lying in the factories as on the Balance Sheet date.


Mar 31, 2013

I) FIXED ASSETS AND DEPRECIATION:

a) Fixed Assets are stated at cost, net of Cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalised. Stores and spares received along with the Plant & Machinery are being capitalised with related machine.

b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without availing CENVAT, and thermal power plant is stated without availing service cenvat. All costs including financing costs till commencement of commercial production and adjustment arising from exchange rate variations relating to borrowings attributable to the fixed assets are capitalized.

c) Depreciation on fixed assets is provided on straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 as amended except depreciation on incremental cost, arising on account of conversion difference of foreign currency liabilities for acquisition of fixed assets and stand by equipments, which are amortised over the residual life of the respective assets.

d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are fully depreciated.

e) The company provides for depreciation on following plant & machinery considering the same as continuous process plant.

(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn Division.

(ii) Power Generation Equipments.

f) Free hold lands and leasehold lands are not depreciated.

g) Impairment of Assets – If the carrying amount of fixed assets exceeds the recoverable amount on the reporting date, the carrying amount is reduced to the recoverable amount. The recoverable amount is measured as the highest of the net selling price and the value in use determined by the present value of estimated future cash flows.

ii) INVENTORIES : Inventories are valued at cost or net realisable value which ever is lower. Historical cost has been determined as under :-

A Raw Materials At Batch cost.

B Stores, Spares At moving weighted average cost.

C Fuel Monthly weighted average

D Work-in-progress (i) Preparatory Stage – at cost

(ii) Yarn Stage-at cost or net

realizable value whichever is lower. E Finished goods at cost or net realizable value whichever is lower. [Cost formula used in clause (D) & (E): – Conversion cost and other cost in bringing the inventories to their present location and condition.]

F Waste and Scrap at net realisable value.

G Trading stocks at cost of purchase

iii) INVESTMENTS: Long term investments are carried at cost including related expenses. In case of diminution in value other than temporary, the carrying amount is reduced to recognize the decline cost.

iv) Raw Material consumption is net of Export benefits.

v) RESEARCH AND DEVELOPMENT : Research and development

costs (other than costs of fixed assets acquired) are charged as an expense in the year in which they are incurred.

vi) EMPLOYEE BENEFITS:

Short-term employee benefits (benefits which are payable within twelve months after the end of the period in which the employees render service) are measured at cost. Long –term employee benefits ( benefits which are payable after the end of twelve months from the end of the period in which the employees render service) and post employment benefits (benefits which are payable after completion of employment ) are measured on a discounted basis by the Projected Unit Credit Method on the basis of annual third party actuarial valuations.

Contributions to Provident Fund , a defined contribution plan are made in accordance with the statute , and are recognized as an expense when employees have rendered service entitling them to the contributions.

The costs of providing leave encashment and gratuity, defined benefit plans, are determined using the Projected Unit Credit Method , on the basis of actuarial valuations carried out by third party actuaries at each balance sheet date. The leave encashment and gratuity benefit obligation recognized in the Balance Sheet represents the present value of the obligations as reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to the discounted value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan. Actuarial gains and losses are recognized immediately in the Profit and Loss Account.

vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:

Preliminary, Capital issue expenses are amortised in a period of ten years. Upfront payment made for reduction in rate of interest and for fresh Term Loans and amalgamation expenses (Debited to Deferred Revenue Expenses) are amortized in a period of five years.

viii) REVENUE RECOGNITION:

(a) The accounts of the company are prepared under the historical cost convention and in accordance with the applicable accounting standards.

(b) Income is accounted for on accrual basis in accordance with Accounting Standard (AS) 9-"Revenue Recognition" which provides that where there is no reasonable certainty, the recognition of income be postponed.

(c) Excise Duty is recognized on dispatches to parties except consignment agents.

(d) Claims lodged with insurance companies and others are recognized in accounts on lodgment to the extent they are measurable with reasonable certainty of acceptance. Excess/Shortfall is adjusted in the year of receipt.

ix) CENVAT

a. CENVAT claimed on capital goods (Plant and Machinery), except for Plant and Machinery of Cotton Yarn Division and Service tax cenvat on plant & machinery of Wartsila Power Division, is credited to Plant and Machinery cost. Depreciation is not charged on the CENVAT claimed on capital goods in the books of account as well as under the Income Tax Act.

b. CENVAT on purchases of such inputs are deducted from the cost, wherever the excise duty has been paid on finished goods manufactured out of these inputs.

x) FOREIGN CURRENCY TRANSACTION –

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. 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 contract.

c. Non monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss Account except incase of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

xi) EXPORT BENEFITS – Export benefits including estimated duty differentials accruing on account of entitlement for duty free raw materials against indigenous/duty paid raw material consumed for exports during the year are estimated and ascertained for at the year end.

xii) PROVISIONS AND CONTINGENT LIABILITIES –

a. Provisions are made when the present obligation of a past event gives rise to probable outflow, embodying economic benefit on settlement and the amount of obligation can be reliably estimated.

b. Contingent Liabilities are disclosed after a careful evaluation of facts and legal aspects of the matter involved

c. Provisions and Contingent Liabilities are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

xiii) TAXATION :

Provision for current tax is made in accordance with the provisions of the Income Tax Act, 1961. Deferred tax on account of timing difference between taxable and accounting income is provided considering the tax rates and tax laws enacted or substantially enacted by the Balance Sheet date in accordance with Accounting Standard 22 as notified by the regulatory authorities.

xiv) EXCISE DUTY :

Excise duty on manufactured goods wherever applicable is accounted for at the point of manufacture of goods and accordingly, is considered for valuation of finished goods stock lying in the factories as on the Balance Sheet date.

 
Subscribe now to get personal finance updates in your inbox!