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Accounting Policies of Sinnar Bidi Udyog Ltd. Company

Mar 31, 2015

A Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956 Accounts are kept on accrual basis and according to the double entry system.

B Revenue Recognition

Revenue from the sale of products is recognised on transfer of all significant risks and rewards of ownership to the buyer which coincides with despatch of products to customers. Interest income is recognised on time proportion basis. Dividend income on investment is accounted for when received.

C Use of Estimates

The preparation and presentation of financial statements requires estimates and assumptions to be made that affact the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognised in the period in which the results are known / materialised.

D Fixed Assets and Depreciation

i Fixed Assets are stated at cost less depreciation , cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets.

ii Depreciation is charged over the estimated useful life of the fixed assets as prescribed in Schedule II of the Companies Act,2013.

E Investments

Long Term Investments are stated at cost less permanent diminution in value, if any.

F Current Assets

a Stocks

Raw Material, Traded Items and Finished Goods are valued at lower of cost or net realisable value. Cost of finished goods includes cost of material and cost of conversion. Cost is determined on monthly weighted average basis, b Book Debts, Advances & Deposits

Balances considered irrecoverable are written- off and those considered doubtful are provided for.

G Employee / Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund.

The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into account the sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year.

Liability arising on account of accrued leave salary payable is provided in the accounts. The same is worked out on the basis of the amount that would have been payable as leave encashment to all the eligible employees on the last day of the financial year. (Refer Note 27 (2))

H Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date. Exchange differences are recognised in the Statement of Profit & Loss.

I Borrowing Costs.

Borrowing costs directly attributable to acquisition or construction of fixed assets which take substantial period of time to get ready for their intended use are treated as capital expenditure in accrodance with Accounting Standard 16 on "Borrowing Costs".

Other borrowing cost are charged to the statement of profit and loss.

J Leases.

Lease rentals for operating leases are charged to statement of profit and loss on accrual basis in accordance with the respective lease agreement.

K Taxation

a Current Year Charges

Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income Tax Act 1961.

b Deferred Tax

The Deferred Tax resulting from timing difference between the book and taxable profit for the year is accounted for,using the tax rates and laws that have been substantially enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognised to the extent there is reasonable certainty that these would be realised in future.

L Contingent Liabilities and Provisions.

Contingent Liabilities are disclosed after a careful evaluation of the facts and legal aspects of the matter involved, in line with the provisions of Accounting Standard (AS) 29. Provisions are recognised when the company has present obligation (legal/constructive) and on management judgement as a result of past event, for which it is probable that a cash outflow may be required and realiable estimate can be made of the amount of the obligation.

A disclosure for 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. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.

Contingent assets are not recognised in the financial statements since this may result in the recognition of income that may never be accrued / realised.


Mar 31, 2014

A Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956.

Accounts are kept on accrual basis and according to the double entry system.

B Revenue Recognition

Revenue from the sale of products is recognised on transfer of all significant risks and rewards of ownership to the buyer which coincides with despatch of products to customers.

Interest income is recognised on time proportion basis. Dividend income on investment is accounted for when received.

C Use of Estimates

The preparation and presentation of financial statements requires estimates and assumptions to be made that affact the reported amount of assets and liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognised in the period in which the results are known / materialised

D Fixed Assets

i Fixed Assets are stated at cost less depreciation , cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets .

ii Depreciation is provided on Written Down Value Method and at the rate and in the manner specified in Schedule XIV of the Companies Act 1956.

E Investments

Long Term Investments are stated at cost less permanent diminution in value, if any.

F Current Assets

a Stocks

Raw Material , Traded Items and Finished Goods are valued at lower of cost or net realisable value. Cost of finished goods includes cost of material and cost of conversion. Cost is determined on monthly weighted average basis.

b Book Debts, Advances & Deposits

Balances considered irrecoverable are written- off and those considered doubtful are provided for.

G Employee / Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund.

The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into account the sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year.

Liability arising on account of accrued leave salary payable is provided in the accounts.The same is worked out on the basis of the amount that would have been payable as leave encashment to all the eligible employees on the last day of the financial year. (Refer Note 27 (2))

H Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date. Exchange differences are recognised in the Statement of Profit & Loss.

I Borrowing Costs.

Borrowing costs directly attributable to acquisition or construction of fixed assets which take substantial period of time to get ready for their intended use are treated as capital expenditure in accrodance with Accounting Standard 16 on "Borrowing Costs" .

Other borrowing cost are charged to the statement of profit and loss.

J Leases.

Lease rentals for operating leases are charged to statement of profit and loss on accrual basis in accordance with the respective lease agreement.

K Taxation

a Current Year Charges

Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income Tax Act 1961.

b Deferred Tax

The Deferred Tax resulting from timing difference between the book and taxable profit for the year is accounted for,using the tax rates and laws that have been substantially enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognised to the extent there is reasonable certainty that these would be realised in future.

L Contingent Liabilities and Provisions.

Contingent Liabilities are disclosed after a careful evaluation of the facts and legal aspects of the matter involved , in line with the provisions of Accounting Standard (AS) 29.

Provisions are recognised when the company has present obligation (legal/constructive) and on management judgement as a result of past event, for which it is probable that a cash outflow may be required and realiable estimate can be made of the amount of the obligation.

A disclosure for 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. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.

Contingent assets are not recognised in the financial statements since this may result in the recognition of income that may never be accrued / realised.

a. Secured by hypothecation of all current assets of the company both present and future.

b. The above credit facility is further secured by equitable mortgage of the following :- - Land and Building situated on Gat No 473 at Post Mahiravani, Trimbak Road, Nashik owned by the company.

- Residential Flats at Dhumraketav Building, Near Camel House, Dwarka, Nashik owned by the company.

- Plot at Gat No 168/1A (P) along with Building thereon at Survey No 1341 on Mumbai Agra Highway, Nandgaon Tal. Dist. Dhule owned by Shri.K B Sarda.

c. The above credit facility is secured by personal guarantee of Shri K B Sarda.

d. Rate of Interest : 13.25% p.a.

Note:-

In past the company used to manufacture and sell ''Bidis''

The Bidi''s manufactured by the company were sold to Traders / Exporters, who used to export them to various countries. Bidi''s sold to some such Traders / Exporters were exported by them to USA.

As per the prevailing law in USA, the responsibility of depositing the amount in Escrow Deposit Fund (On account of sales of tobacco products in that country) was of the manufacturer of tobacco products.

Accordingly , on the basis of demand raised against the company for non-fulfillment of this requirement - a sum of Rs.201.46 Lacs is provided for in the books of the company upto 31st March 2014. (31st March 2013 - Rs 183.70 Lacs)

During the current year no any fresh demand was made against the company. The current year figure of appearing in Statement of Profit and Loss Rs.17.76 Lacs represents foreign exchange loss on restatement of outstanding liability of escrow fund demand provision already made in earlier years (Previous year : Loss Rs.10.92 Lacs)


Mar 31, 2013

A Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956

Accounts are kept on accrual basis and according to the double entry system.

Sales are recognized on dispatch of goods to customers.

Dividend Income on Investments is accounted for when received.

B Fixed Assets

i Fixed Assets are stated at cost less depreciation , cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets .

ii Depreciation is provided on Written Down Value Method and at the rate and in the manner specified in Schedule XIV of the Companies Act 1956.

C Investments

Long Term Investments are stated at cost .

D Current Assets a Stocks

Raw Material , Traded Items and Finished Goods are valued at lower of cost or net realizable value. Cost of finished goods includes cost of material and cost of conversion. Cost is determined on monthly weighted average basis.

b Book Debts, Advances & Deposits

Balances considered irrecoverable are written- off and those considered doubtful are provided for.

E Employee / Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund.

The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into account the sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year.

Liability arising on account of accrued leave salary payable is provided in the accounts. The same is worked out on the basis of the amount that would have been payable as leave encashment to all the eligible employees on the last day of the financial year. (Refer Note 28 (2))

F Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date. Exchange differences are recognized in the Statement of Profit & Loss.

G Borrowing Costs.

Borrowing costs directly attributable to acquisition or construction of fixed assets which take substantial period of time to get ready for their intended use are treated as capital expenditure in accordance with Accounting Standard 16 on "Borrowing Costs" .

Other borrowing cost are charged to the statement of profit and loss.

H Leases.

Lease rentals for operating leases are charged to statement of profit and loss on accrual basis in accordance with the respective lease agreement.

I Taxation

a Current Year Charges

Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income Tax Act 1961.

b Deferred Tax

The Deferred Tax resulting from timing difference between the book and taxable profit for the year is accounted for, using the tax rates and laws that have been substantially enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognized to the extent there is reasonable certainty that these would be realized in future.

J Contingent Liabilities and Provisions.

Contingent Liabilities are disclosed after a careful evaluation of the facts and legal aspects of the matter involved , in line with the provisions of Accounting Standard (AS) 29.

Provisions are recognized when the company has present obligation (legal/constructive) and on management judgment as a result of past event, for which it is probable that a cash outflow may be required and reliable estimate can be made of the amount of the obligation.

A disclosure for 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. When there is a possible obligation or at present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.

Contingent assets are not recognized in the financial statements since this may result in the recognition of income that may never be accrued / realized.


Mar 31, 2012

A Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956 Accounts are kept on accrual basis and according to the double entry system.

Sales are recognized on despatch of goods to customers.

Dividend Income on Investments is accounted for when received.

B Fixed Assets

i Fixed Assets are stated at cost less depreciation , cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets.

ii Depreciation is provided on Written Down Value Method and at the rate and in the manner specified in Schedule XIV of the Companies Act 1956.

C Investments

Long Term Investments are stated at cost. .

D CurrentAssets

a Stocks

Raw Material, Traded Items and Finished Goods are valued at lower of monthly weighted average cost and net realizable value. Cost of finished goods include cost of material, costof conversion, labour, b Book Debts, Advances & Deposits Balances considered irrecoverable are written- off and those considered doubtful are provided for.

E Employee/Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund.

The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into account the sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year.

F Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date. Exchange differences are recognised in the Statement of Profit & Loss.

G Taxation

a Current Year Charges

Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income Tax. b Deferred Tax

The Deferred Tax resulting from timing difference between the book and taxable profit for the year is accounted for, using the tax rates and laws that have been substantially enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognised to the extent there is reasonable certainty that these would be realised in future.

H Contingent Liabilities

Contingent Liabilities are disclosed in the accounts by way of note.

"The company has not received any intimation from its suppliers regarding their status under the Micro , Small and Medium Enterprises Development Act, 2006 and hence disclosures , if any, relating to amounts unpaid as at the year end as required under the said Act have not been furnished."


Mar 31, 2011

A Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956 Accounts are kept on accrual basis and according to the double entry system.

Sales are recognised on despatch of goods to customers.

Dividend Income on Investments is accounted forwhen received.

B Fixed Assets

i Fixed Assets are stated at cost less depreciation , cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets.

ii Depreciation is provided on Written Down Value Method and at the rate and in the manner specified in Schedule XIV of the Companies Act 1956.

C Investments

Long Term Investments are stated at cost.

D CurrentAssets

a. Stocks

Raw Material , Traded Items and Finished Goods are valued at lower of monthly weighted average cost and net realisable value.Cost of finished goods include cost of material,cost of conversion,labour.

b. Book Debts, Advances & Deposits Balances considered irrecoverable are written- off and those considered doubtful are provided for.

E Employee/Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund. The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into account the sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year. Liability arising on account of accrued leave salary payable is provided in the accounts.The same is worked out on the basis of the amount that would have been payable as leave encashment to all the eligible employees on the last day of the financial year.

F Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date.Exchange differences are recognised in the Profit & LossAccount.

G Taxation

a Current Year Charges Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income TaxAct1961. b Deferred Tax The Deferred Tax resulting from timing difference between the book and taxable profit for the year is accounted for, using the tax rates and laws that have been substantially enacted as of the balance sheet date. Deferred tax assets arising from timing difference are recognised to the extent there is reasonable certainty that these would be realised in future.

H Contingent Liabilities

Contingent Liabilities are disclosed in the accounts by way of note.


Mar 31, 2010

A. Accounting Convention / Method of Accounting.

The Financial Statements are prepared under Historical Cost Convention in accordance with generally accepted accounting principles and provisions of Companies Act 1956

Accounts are kept on accrual basis and according to the double entry system. Sales are recognised on despatch of goods to customers.

Dividend Income on Investments is accounted for when received.

B. Fixed Assets

i Fixed Assets are stated at cost less depreciation, cost being comprised of cost of acquisition and expenditure directly attributable for commissioning of the assets.

ii Depreciation is provided on Written Down Value Method and at the rate and in the manner specified in Schedule XIV of the Companies Act 1956.

C. investments

Long Term Investments are stated at cost.

D. Current Assets

a. Stocks

Raw Material , Traded Items and Finished Goods are valued at lower of monthly weighted average cost and net realisable value. Cost of finished goods include cost of materialist of conversion, labour.

b. Book Debts, Advances & Deposits

Balances considered irrecoverable are written-off and -ose considered doubtful are provided for.

E. Employee / Retirement Benefits

Retirement Benefits to employees are provided for by payments to Gratuity and Provident Fund. The gratuity liability is determined on the basis laid down under Employees Approved Gratuity Fund Scheme which takes into accountthe sum that would have been payable as gratuity to all the eligible employees on the last day of the financial year.Liability arising on account of accrued leave salary payable is provided in the accounts. the same is worked out on the basis of the amount that would have been payable as leave encashment to all the eligible employees on the last day of the financial year.

F. Foreign Currency Transactions

Monetary items denominated in foreign currency as at the Balance Sheet date are converted at exchange rates prevailing on that date.Exchange differences are recognised inthe Profit & Loss Account.

G. Taxation

a. Current Year Charges

Provision for tax is based on the amount of tax payable in respect of taxable income as determined under Income Tax Act 1961.

Fringe Benefit Tax provision is made on the basis of liability for the year as ascertained by the Management underthe provisions of Income Tax Act,1961.

b. Deferred Tax

The Deferred Tax resulting from timing difference between the book and taxable profits for the year is accounted for,usingthe tax rates and laws that have been substantially enacted as of the balance sheet date.

Deferred tax assets arising from timing difference are recognised to the extentthere is reasonable certainty That these would be realised in future.

H. Contingent Liabilities

Contingent Liabilities are disclosed inthe accounts by way of note.

 
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