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Accounting Policies of Shri Bajrang Alloys Ltd. Company

Mar 31, 2015

COMPANY OVERVIEW :

Shri Bajrang Alloys Limited is a Public Limited Company incorporated under the provision of the Companies Act 1956, having its Regd. Office in Raipur. The Company has listed its share in Bombay Stock of Exchange (BSE) of India. The Company is mainly engaged in manufacturing of Structural Steels like Angle, Channel, Joist/Beam, Round etc.

BASIS OF PREPARATION:

(i) The financial statements have been prepared on Historical Cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 and the applicable Accounting Standards in India.

(ii) The Company follows mercantile system of accounting and recognizes income and expenditure on accrual basis except those with significant uncertainties.

(iii) The accounting policies have been consistently applied by the Company.

USE OF ESTIMATES :

The preparation 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 & expenses during the reported period. Although these statements are based up on management's best knowledge of current events and actions, actual results could differ from these statements. Difference between the actual results and the estimates are recognized in the period in which the results are known / materialized.

FIXED ASSETS :

Fixed Assets are stated at acquisition cost less depreciation. Cost includes related taxes, duties, freight, insurance etc., attributable to acquisition and installation of assets and borrowing cost incurred up to the date of commencing operations, but excludes duties and taxes that are recoverable subsequently from the taxing authorities.

DEPRECIATION :

(i) Depreciation is provided based on useful life of the assets and scrap value (5% of the original cost) as prescribed in Schedule II to the Companies Act, 2013 except, in respect of Rolls, where useful life taken for one year only as per the technical advice.

(ii) Leasehold land is amortized over the period of lease.

(iii) Depreciation on Fixed Assets added / disposed off during the year is provided on pro-rata basis

with reference to the date of addition / disposal. (iv) Expenditure of amount below Rs. 5000 /- had been written off in full.

INVESTMENTS :

(i) Long Term Investments are stated at cost. A provision for diminution is made to recognize a decline, other than temporary, in the value of long term investments.

(ii) Current Investments are stated at lower of cost and fair value.

INVENTORIES : Inventories are valued in following manner:

(i) Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any.

(ii) Cost of inventories of finished goods comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

(iii) Cost of Finished Goods are determined on FIFO basis and By-products are valued at net realizable value.

(iv) Cost of raw materials, stores and consumables, trading and other products are determined on FIFO basis.

CONTINGENT LIABILITIES :

Liabilities which are material and whose future outcome cannot be reasonably ascertained are treated as contingent and not provided for and disclosed by way of notes to the accounts.

REVENUE RECOGNITION :

(i) Mercantile method of accounting has been employed unless otherwise specifically stated elsewhere in this schedule. However where the amount is immaterial / negligible and / or establishment of accrual / determination of amount is not possible, no entry is made for accruals.

(ii) Sale of Products - Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Excise Duty and Value Added Tax deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability raised during the year.

(iii) Bonus and Leave Encashment are recognized as per Cash Basis.

FOREIGN CURRENCY TRANSACTIONS :

(i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(ii) Any income or expense on account of exchange difference on settlement of Monetary items is recognized in the Profit & Loss Account.

(iii) In respect of transactions covered by Forward Foreign Exchange Contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expenses over the life of the contract except for contracts relating to liabilities incurred for purchase of Fixed Assets, the difference thereof is adjusted in the carrying amount of respective Fixed Assets.

BORROWING COST :

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of fixed assets are capitalized only with respect to qualifying fixed assets i.e. those which take substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

EMPLOYEES RETIREMENT BENEFITS:

(i) Defined Contribution plan

Company's contribution to Provident Fund and Employee State Insurance are charged to Profit and Loss Account. Value of encashable leave are encased during the year and charged to Profit & Loss Account. There is no other obligation other than the contribution payable to respective authorities.

(ii) Defined Benefit plan

Company's Liabilities towards gratuity are recognized as an expenses in Profit & Loss Account for the year in which the employee has rendered services. The expenses determined using actuarial valuation techniques & assumptions. Actuarial gain or losses are charged to profit & loss account.

PROVISIONS :

Provisions are recognized, where the Company has any legal or constructive obligation or where realizable estimate can be made for the amount of the obligation and as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

IMPAIRMENT OF ASSETS :

The Company assesses at each Balance Sheet date whether there is any indication that any asset may be impaired. If any such indication exists, the carrying value of such assets is reduced to its estimated recoverable amount and the amount of such impairment loss is charged to profit & loss account. If at the Balance Sheet date there is an indication that previously assessed impairment loss no longer exists, then such loss is reversed and the asset is restated to that effect.

TURNOVER :

Gross Turnover includes excise duty and sales tax/VAT. Excise duty and VAT amount have been deducted from the Turnover (Gross) is the amount actually incurred with related to sales during the year and not the entire amount of the liability arising during the year.

EXCISE DUTY :

Excise duty expenses are accounted for at the time of removal of goods from the factory. Total excise expenses includes the amount of reversal of CENVAT amount and penalty, if any, on order passed during the year.

CENVAT Credit relating to raw materials/components are debited under current assets for availing credit against CENVAT and credited to respective materials/component account.

SEGMENT REPORTING :

The Company has only one primary segment, i.e. Structural Rolling Mill. As such there is no other reportable segment as defined by Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India. There is no reportable Geographical Segment either.

PROVISION FOR CURRENT AND DEFERRED TAX :

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book profit and taxable profit is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. The Deferred Tax Asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be realized in future.

EARNING PER SHARE :

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.

In accordance with "Accounting Standard – 22" issued by the "Institute of Chartered Accountants of India", the Company has recognized net of deferred tax assets and deferred tax liability amounting to Rs. 3745734/- as on 31/03/2015 under a separate head "Deferred Tax Liability". Deferred tax Expenses for the year amounting to Rs. (-63333)/- has been recognized in the Profit & Loss Account.

** As clarified by management all above Mentioned Unsecured loan treated as Long term.

*** Maturity Profile of Unsecured Term Loans from Financial Institutions & Banks are as set out below :

Note : There is no default, continuing or otherwise, as at the balance sheet date, in repayment of any of the above loans.

* In respect of Fixed Assets acquired on finance lease as per Accounting Standard on Leases (AS-19), the minimum lease rentals outstanding as on 31st March, 2015 are as follows:

Defined Benefit Plan Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service or part thereof in excess of 6 months and its payable on retirement / termination/ resignation. The benefit vests on the employees after completion of 5 Years of service. The gratuity liability has not been externally funded. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Since the entire amount of plan obligation is unfunded, therefore change in the fair value of plan assets are not given. Further the entire amount of plan obligation is unfunded, therefore categories of plan asset as a percentage of the fair value of total plan assets and company's expected contribution to the plan assets in the next year is not given.

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of Plan assets held, assessed risks, historical results of return on plan assets and the Company's policy for plan assets management.

Leave Encashment

The obligation for leave encashment is recognized during the year of Rs.146206/- (P.Y.Rs.160864/-) , is equivalent to one month salary and charged to Profit & Loss Account


Mar 31, 2014

BASIS OF PREPARATION:

(i) The financial statements have been prepared on Historical Cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 and the applicable Accounting Standards in India.

(ii) The company follows mercantile system of accounting and recognizes income and expenditure on accrual basis except those with significant uncertainties.

(iii) The accounting policies have been consistently applied by the company.

USE OF ESTIMATES :

The preparation 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 & expenses during the reported period. Although these statements are based up on management''s best knowledge of current events and actions, actual results could differ from these statements. Difference between the actual results and the estimates are recognised in the period in which the results are known / materialised.

FIXED ASSETS :

Fixed Assets are stated at acquisition cost less depreciation. Cost includes related taxes, duties, freight, insurance etc., attributable to acquisition and installation of assets and borrowing cost incurred up to the date of commencing operations, but excludes duties and taxes that are recoverable subsequently from the taxing authorities.

DEPRECIATION :

(i) Depreciation on Fixed Assets has been provided on "Straight Line Basis" at the rates and in the manner prescribed in Schedule - XIV of the Companies Act, 1956.

(ii) Leasehold land is amortised over the period of lease.

(iii) Depreciation on Fixed Assets added / disposed off during the year is provided on pro-rata basis with reference to the date of addition / disposal.

(iv) Expenditure of amount below Rs. 5000 /- had been written off in full.

INVESTMENTS :

(i) Long Term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

(ii) Current Investments are stated at lower of cost and fair value.

INVENTORIES : Inventories are valued in following manner:

(i) Items of inventories are measured at lower of cost and net realisable value after providing for obsolescence, if any.

(ii) Cost of inventories of finished goods comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

(iii) Cost of Finished Goods are determined on FIFO basis and By-products are valued at net realisable value.

(iv) Cost of raw materials, stores and Consumables, trading and other products are determined on FIFO basis.

CONTINGENT LIABILITIES :

Liabilities which are material and whose future outcome cannot be reasonably ascertained are treated as contingent and not provided for and disclosed by way of notes to the accounts.

REVENUE RECOGNITION :

(i) Mercantile method of accounting has been employed unless otherwise specifically stated elsewhere in this schedule. However where the amount is immaterial / negligible and / or establishment of accrual / determination of amount is not possible, no entry is made for accruals.

(ii) Sale of Products - Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Excise Duty and Value Added Tax deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year.

(iii) Bonus and Leave Encashment are recognised as per Cash Basis.

FOREIGN CURRENCY TRANSACTIONS :

(i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(ii) Any income or expense on account of exchange difference on settlement of Monetary items is recognised in the Profit & Loss Account.

(iii) In respect of transactions covered by Forward Foreign Exchange Contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expenses over the life of the contract except for contracts relating to liabilities incurred for purchase of Fixed Assets, the difference thereof is adjusted in the carrying amount of respective Fixed Assets.

BORROWING COST :

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of fixed assets are capitalized only with respect to qualifying fixed assets i.e. those which take substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

EMPLOYEES RETIREMENT BENEFITS:

(i) Defined Contribution plan

Company''s contribution to Provident Fund and Employee state Insurance are charged to Profit and Loss Account. Value of encashable leave are encashed during the year and charged to Profit & Loss Account. There is no other obligation other than the contribution payable to respective authorities.

(ii) Defined Benefit plan

Company''s Liabilities towards gratuity are recognized as an expenses in Profit & Loss Account for the year in which the employee has rendered services. The expenses determined using actuarial valuation techniques & assumptions. Actuarial gain or losses are charged to profit & loss account.

PROVISIONS :

Provisions are recognized, where the company has any legal or constructive obligation or where realizable estimate can be made for the amount of the obligation and as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

IMPAIRMENT OF ASSETS :

The Company assesses at each balance sheet date whether there is any indication that any asset may be impaired. If any such indication exists, the carrying value of such assets is reduced to its estimated recoverable amount and the amount of such impairment loss is charged to profit & loss account. If at the balance sheet date there is an indication that previously assessed impairment loss no longer exists, then such loss is reversed and the asset is restated to that effect.

TURNOVER :

Gross Turnover includes excise duty and sales tax/VAT. Excise duty and VAT amount have been deducted from the Turnover (Gross) is the amount actually incurred with related to sales during the year and not the entire amount of the liability arising during the year.

EXCISE DUTY :

Excise duty expenses are accounted for at the time of removal of goods from the factory. Total excise expenses includes the amount of reversal of cenvat amount and penalty, if any, on order passed during the year.

CENVAT Credit relating to raw materials/components are debited under current assets for availing credit against CENVAT and credited to respective materials/component account.

SEGMENT REPORTING :

The company has only one primary segment, i.e. Structural Rolling Mill. As such there is no other reportable segment as defined by Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India. There is no reportable Geographical Segment either.

PROVISION FOR CURRENT AND DEFERRED TAX :

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book profit and taxable profit is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. The Deferred Tax Asset is recognised and carried forward only to the extent that there is reasonable certainty that the asset will be realised in future.

EARNING PER SHARE :

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.


Mar 31, 2013

1. BASIS OF PREPARATION:

(i) The financial statements have been prepared on Historical Cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 and the applicable Accounting Standards in India.

(ii) The company follows mercantile system of accounting and recognizes income and expenditure on accrual basis except those with significant uncertainties.

(iii) The accounting policies have been consistently applied by the company.

2. USE OF ESTIMATES:

The preparation 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 & expenses during the reported period. Although these statements are based up on management''s best knowledge of current events and actions, actual results could differ from these statements. Difference between the actual results and the estimates are recognised in the period in which the results are known / materialised.

3. FIXED ASSETS:

Fixed Assets are stated at acquisition cost less depreciation. Cost includes related taxes, duties, freight, insurance etc., attributable to acquisition and installation of assets and borrowing cost incurred up to the date of commencing operations, but excludes duties and taxes that are recoverable subsequently from the taxing authorities.

4. DEPRECIATION:

(i) Depreciation on Fixed Assets has been provided on "Straight Line Basis" at the rates and in the manner prescribed in Schedule - XIV of the Companies Act, 1956.

(ii) Leasehold land is amortised over the period of lease.

(iii) Depreciation on Fixed Assets added / disposed off during the year is provided on pro-rata basis with reference to the date of addition / disposal.

(iv) Expenditure of amount below Rs. 5000 /- had been written off in full.

5. INVESTMENTS:

(i) Long Term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

(ii) Current Investments are stated at lower of cost and fair value.

6. INVENTORIES:

Inventories are valued in following manner:

(i) Items of inventories are measured at lower of cost and net realisable value after providing for obsolescence, if any.

(ii) Cost of inventories of finished goods comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

(iii) Cost of Finished Goods are determined on FIFO basis and By-products are valued at net realisable value.

(iv) Cost of raw materials, stores and consumables, trading and other products are determined on FIFO basis.

7. CONTINGENT LIABILITIES:

Liabilities which are material and whose future outcome cannot be reasonably ascertained are treated as contingent and not provided for and disclosed by way of notes to the accounts.

8. REVENUE RECOGNITION:

(i) Mercantile method of accounting has been employed unless otherwise specifically stated elsewhere in this schedule. However where the amount is immaterial / negligible and / or establishment of accrual / determination of amount is not possible, no entry is made for accruals.

(ii) Sale of Products - Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Excise Duty and Value Added Tax deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year.

(iii) Bonus and Leave Encashment are recognised as per Cash Basis.

9. FOREIGN CURRENCY TRANSACTIONS:

(i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(ii) Any income or expense on account of exchange difference on settlement of monetary items is recognised in the Profit & Loss Account.

(iii) In respect of transactions covered by Forward Foreign Exchange Contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expenses over the life of the contract except for contracts relating to liabilities incurred for purchase of Fixed Assets, the difference thereof is adjusted in the carrying amount of respective Fixed Assets.

10. BORROWING COST:

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of fixed assets are capitalized only with respect to qualifying fixed assets i.e. those which take substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.

11. EMPLOYEES RETIREMENT BENEFITS:

(i) Defined Contribution plan

Company''s contribution to Provident Fund and Employee State Insurance are charged to Profit and Loss Account. Value of encashable leave are encashed during the year and charged to Profit & Loss Account. There is no other obligation other than the contribution payable to respective authorities.

(ii) Defined Benefit plan

Company''s Liabilities towards gratuity are recognized as an expenses in Profit & Loss Account for the year in which the employee has rendered services. The expenses determined using actuarial valuation techniques & assumptions. Actuarial gain or losses are charged to profit & loss account.

12. PROVISIONS:

Provisions are recognized, where the company has any legal or constructive obligation or where realizable estimate can be made for the amount of the obligation and as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

13. IMPAIRMENT OF ASSETS:

The Company assesses at each balance sheet date whether there is any indication that any asset may be impaired. If any such indication exists, the carrying value of such assets is reduced to its estimated recoverable amount and the amount of such impairment loss is charged to profit & loss account. If at the balance sheet date there is an indication that previously assessed impairment loss no longer exists, then such loss is reversed and the asset is restated to that effect.

14. TURNOVER:

Gross Turnover includes sales inclusive of excise duty, sales tax, services and are adjusted for discounts.

15. EXCISE DUTY:

Excise duty expenses are accounted for at the time of removal of goods from the factory. Total excise expenses includes the amount of reversal of cenvat amount and penalty, if any, on order passed during the year.

CENVAT Credit relating to raw materials/components are debited under current assets for availing credit against CENVAT and credited to respective materials/component account.

16. SEGMENT REPORTING:

The company has only one primary segment, i.e. Structural Rolling Mill. As such there is no other reportable segment as defined by Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, there is no reportable Geographical Segment either.

17. PROVISION FOR CURRENT AND DEFERRED TAX:

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book profit and taxable profit is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet date. The Deferred Tax Asset is recognised and carried forward only to the extent that there is reasonable certainty that the asset will be realised in future.

18. EARNING PER SHARE:

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.


Mar 31, 2012

1. BASIS OF PREPARATION:

(i) The financial statements have been prepared on Historical Cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 and the applicable Accounting Standards in India.

(ii) The company follows mercantile sustem of accounting and recognizes income and expenditure on accrual basis except those with significant uncertainties.

(iii) The accounting policies have been consistently applied by the company.

2. USE OF ESTIMATES:

The preparation 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 & expenses during the reported period. Although these statements are based up on management's best knowledge of current events and actions, actual results could differ from these statements. Difference between the actual results and the estimates are recognized in the period in which the results are known / materialized.

3. FIXED ASSETS:

Fixed Assets are stated at acquisition cost less depreciation. Cost includes related taxes, duties, freight, insurance etc attributable to acquisition and installation of assets and borrowing cost incurred up to the date of commencing operations, but excludes duties and taxes that are recoverable subsequently from the taxing authorities.

4. DEPRECIATION:

(i) Depreciation on Fixed Assets has been provided on "Straight Line Basis" at the rates and in the manner prescribed in Schedule - XIV of the Companies Act, 1956.

(ii) Leasehold land is amortized over the period of lease.

(iii) Depreciation on Fixed Assets added / disposed off during the year is provided on pro-rata basis with reference to the date of addition / disposal.

(iv) Expenditure of amount below Rs. 5000 /- had been written off in full.

5. INVESTMENTS:

(i) Long Term Investments are stated at cost. A provision for diminution is made to recognize a decline, other than temporary, in the value of long term investments.

(ii) Current Investments are stated at lower of cost and fair value.

6. INVENTORIES: Inventories are valued in following manner:

Raw Materials : At Cost

Finished Goods : At Lower of Cost or Market Price

Traded Goods : At Cost

Materials in transit : At Invoice Value.

Stores & Consumables : At Cost

Waste and Scrap : At Net Realisable Value

Cost of finished goods includes direct materials, labour and conversion and other manufacturing expenses incurred to bring the inventories in the present condition and location

The determination of cost are on FIFO basis.

7. CONTINGENT LIABILITIES:

Liabilities which are material and whose future outcome cannot be reasonably ascertained are treated as contingent and not provided for and disclosed by way of notes to the accounts.

8. REVENUE RECOGNITION:

(i) Mercantile method of accounting has been employed unless otherwise specifically stated elsewhere in this schedule. However where the amount is immaterial / negligible and / or establishment of accrual / determination of amount is not possible, no entry is made for accruals.

(ii) Sale of Products - Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Excise Duty and Value Added Tax deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year.

(iii) Bonus and Leave Encashment are recognized as per Cash Basis.

9. FOREIGN CURRENCY TRANSACTIONS:

(i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(ii) Any income or expense on account of exchange difference on settlement of Monetary items is recognized in the Profit & Loss Account.

(iii) In respect of transactions covered by Forward Foreign Exchange Contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expenses over the life of the contract except for contracts relating to liabilities incurred for purchase of Fixed Assets, the difference thereof is adjusted in the carrying amount of respective Fixed Assets.

10. BORROWING COST:

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of fixed assets are capitalized only with respect to qualifying fixed assets i.e. those which take substantial period of time to get ready for its intended use.

11. EMPLOYEES RETIREMENT BENEFITS:

(i) Defined Contribution plan

Company's contribution to Provident Fund and Employee state Insurance are charged to Profit and Loss Account. Value of encashable leave are encashed during the year and charged to Profit & Loss Account. there is no other obligation other than the contribution Payable to respective authorities.

Change in Accounting Policy

(ii) Defined Benefit plan

In compliance of the accounting standard 15 (revised) issued by ICAI, the company had determined the liability required as per revised AS-15, which was mandatory w.e.f. 01.04.2007 therefore company had change its policy regarding defined benefit plan as given below.

Company's Liabilities towards gratuity are recognized as an expenses in profit & Loss Account for the year in which the employee has rendered services. The expenses determined using actuarial valuation techniques & assumptions. Actuarial gain or losses are charged to profit & loss account.

12. PROVISIONS:

Provisions are recognized, where the Company has any legal or constructive obligation or where realizable estimate can be made for the amount of the obligation and as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

13. IMPAIRMENT OF ASSETS:

The Company assesses at each balance sheet date whether there is any indication that any asset may be impaired. If any such indication exists, the carrying value of such assets is reduced to its estimated recoverable amount and the amount of such impairment loss is charged to profit & loss account. If at the balance sheet date there is an indication that previously assessed impairment loss no longer exists, then such loss is reversed and the asset is restated to that effect.

14. TURNOVER:

Gross Turnover includes sales inclusive of excise duty, sales tax, services and are adjusted for discounts.

15. EXCISE DUTY:

Excise duty expenses are accounted for at the time of removal of goods from the factory. Total excise expenses includes the amount of reversal of canvas amount and penalty, if any, on order passed during the year.

CENVAT Credit relating to raw materials/components are debited under current assets for availing credit against CENVAT and credited to respective materials/component account.

16. SEGMENT REPORING:

The Company has only one primary segment, i.e. Structural Rolling Mill. As such there is no other reportable segment as defined by Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India. There is no reportable Geographical Segment either.

17. PROVISION FOR CURRENT AND DEFERRED TAX:

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book profit and taxable profit is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet Date. The Deferred Tax Asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be realised in future.

18. EARNING PER SHARE:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.


Mar 31, 2010

1. BASIS OF PREPARATION:

(i) The financial statements have been prepared on Historical Cost convention in accordance with the generally accepted accounting principles and the provisions of the Companies Act, 1956 and the applicable Accounting Standards in India.

(ii) The company follows mercantile sustem of accounting and recognizes income and expenditure on accrual basis except those with significant uncertanities.

(iii) The accounting policies have been consistently applied by the company..

2. USE OF ESTIMATES:

The preparation 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 & expenses during the reported period. Although these statements are based up on managements best knowlege of current events and actions, actual results could differ from these statements. Difference between the actual results and the estimates are recognised in the period in which the results are known / materialised.

3. FIXED ASSETS:

Fixed Assets are stated at acquisition cost less depreciation. Cost includes related taxes, duties, freight, insurance etc attributable to acquisition and installation of assets and borrowing cost incurred up to the date of commencing operations, "but excludes duties and taxes that are recoverable subsequently from the taxing authorities.

4. DEPRECIATION:

(i) Depreciation on Fixed Assets has been provided on "Straight Line Basis" at the rates and in the manner prescribed in Schedule - XIV of the Companies Act, 1956.

(ii) Leasehold land is amortised over the period of lease.

(iii) Depreciation on Fixed Assets added / disposed off during the year is provided on pro-rata basis with reference to the date of addition / disposal.

(iv) Expenditure of amount below Rs. 5000 /- had been written of in full.

5. INVESTMENTS

(i) Long Term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

(ii) Current Investments are stated at lower of cost and fair value.

6. INVENTORIES: Inventories are valued in following manner:

Raw Materials,Furnace Oil : At Cost

Finished Goods : At Lower of Cost or Market Price

Traded Goods : At Cost

Materials in transit : At Invoice Value.

Stores & Consumables : At Cost

Waste and Scrap : At Net Realisable Value

Cost of finished goods includes direct materials, labour and conversion and other manufacturing expenses incurred to bring the inventories in the present condition and location The cost formulae used for determination of cost are on FIFO basis.

7. CONTINGENT LIABILITIES:

Liabilities which are material and whose future outcome cannot be reasonably ascertained are treated as contingent and not provided for and disclosed by way of notes to the accounts.

8. REVENUE RECOGNITION

(i) Mercantile method of accounting has been employed unless otherwise specifically stated elsewhere in this schedule. However where the amount is immaterial / negligible and / or establishment of accrual / determination of amount is not possible, no entry is made for accruals.

(ii) Sale of Products - Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Excise Duty and Value Added Tax deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year.

(iii) Bonus and Leave Encashment are recognised as per Cash Basis.

9. FOREIGN CURRENCY TRANSACTIONS

(i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(ii) Any income or expense on account of exchange difference on settlement of Monetary items is recognised in the Profit & Loss Account.

(iii) In respect of transactions covered by Forward Foreign Exchange Contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expenses over the life of the contract except for contracts relating to liabilities incurred for purchase of Fixed Assets, the difference thereof is adjusted in the carrying amount of respective Fixed Assets.

10. BORROWING COST

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of fixed assets are capitalized only with respect to qualifying fixed assets i.e. those which take substantial period of time to get ready for its intended use.

11. EMPLOYEES RETIREMENT BENEFITS:

(i) Defined Contribution plan

Companys contribution to Provident Fund and Employee state Insurance are charged to Profit and Loss Account. Value of encashable leave are encashed during the year and charged to Profit & Loss Account. there is no other obligation other than the contribution Payable to respective authorities.

(ii) Defined Benefit

plan Companys Liabilities towards gratuity are determined on the basis of simple calculation as per Gratuity Act and Labour Act only.

12. PROVISIONS

Provisions are recognized, where the company has any legal or constructive obligation or where realiable estimate can be made for the amount of the obligation and as a result of past events, for which it is probable that an outflow of economic benefits will be required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

13. IMPAIRMENT OF ASSETS

The Company assesses at each balance sheet date whether there is any indication that any asset may be impaired. If any such indication exists, the carrying value of such assets is reduced to its estimated recoverable amount and the amount of such impairment loss is charged to profit & loss account. If at the balance sheet date there is an indication that previously assessed impairment loss no longer exists, then such loss is reversed and the asset is restated to that effect.

14. TURNOVER

Turnover includes sales inclusive of excise duty, sales tax, services and are adjusted for discounts.

15. EXCISE DUTY

Excise duty expenses are accounted for at the time of removal of goods form the factory. Total excise expenses includes the amount of reversal of cenvat amount and penalty, if any, on order passed during the year. CENVAT Credit relating to raw materials/components are debited under current assets for availing credit against CENVAT and credited to respective materials/component account.

16. UNSECURED LOAN FORM OTHERS

Unsecured Loan from others consists of amount payable to State Sales Tax Department on account of deferred sales tax liability.

17. SEGMENT REPORING

The company has only one primary segment, i.e. Structural Rolling Mill. As such there is no other reportable segment as defined by Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India. There is no reportable Geographical Segment either.

18. PROVISION FOR CURRENT AND DEFERRED TAX:

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book profit and taxable profit is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the Balance Sheet Date. The Deferred Tax Asset is recognised and carried forward only to the extent that there is reasonable certainty that the asset will be realised in future.

19. EARNING PER SHARE

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period.

 
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