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Accounting Policies of Som Distilleries & Breweries Ltd. Company

Mar 31, 2015

1.1 Basis for preparation of accounts

These financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and other accounting principles generally accepted in India, to the extent applicable.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 70 days for the purpose of current/non-current classification of assets and liabilities.

2.2 Revenue Recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation.

2.3 Expenditure

Expenses are accounted for on accrual basis and provision is made for all known losses and liabilities.

2.4 Fixed Assets and depreciation

Fixed assets other than land (including site development) are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost (freight, duties, levies etc.) of bringing the asset to its working condition for its intended use and capitalization of interest and other expenses incurred uptothedateof commissioning. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013 except in respect of the labour quarters where useful life is different than those prescribed in Schedule II are used.

2.5 Impairment of Asset

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the assets. If any indication exists, an asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of the asset exceeds the recoverable amount.

2.6 Inventories

Inventories are stated at lower of cost and net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, packing material, stores and spares on first in first out basis.

(ii) Stock in process and finished goods taking into account the annual average cost of materials consumed, direct production expenses, interest, depreciation and related Government duties.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs neces sary to make the saie.

2.7 Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rates prevailing on the date of the transactions.

Current assets and liabilities in foreign currency are converted at the exchange rate prevailing at the year end and exchange differences are recognized in the Profit and Loss Account.

2.8 Retirement and Other Employee Benefits

Short Term Employee Benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees render the services.

These benefits include performance incentive and compensated absences,

Post-Employment Benefits Defined Contribution Plans

A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund.

The Company's contribution is recognized as an expense in the Statement of Profit and Loss during the period in which the employee renders the related service.

Defined Benefit Plans

The liability in respect of defined benefit plans and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from employees1 services.

Actuarial gains and losses in respect of post-employment and other long term benefits are charged to the Statement of Profit and Loss.

2.9 Provision for Current and Deferred Tax

Provision for Current Tax is made after taking into consideration benefits admissible under the Income Tax Act. 1961. Deferred Tax resulting from 'timing difference' between taxable and accounting income is computed using tax rates and laws that are enacted or substantively enacted by the Balance Sheet date.


Mar 31, 2014

1.1 Basis for preparation of accounts

The Company maintains its accounts on accrual basis following the historical cost convention in accordance with generally accepted accounting principles (GAAP). According to Circular 15/2013 dated 13th September, 2013 read with circular 08/2014 dated 4th April, 2014, till the standards of Accounting or any addendum thereto are prescribed by the Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing Accounting Standards notified under the Companies Act, 1956 shall continue to apply. Consequently, these financial statements have been prepared to comply in all material aspects with the accounting standards notified under section 211 (3C) Companies (Accounting Standards) Rules, 2006 as amended and other relevant provisions of the Companies Act, 1956.

All assets and liabilities have been classified as current or non current as per the Company''s normal operating cycle and other criteria set out in the Revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 70 days for the purpose of current/no-current classification of assets and liabilities.

2.2 Revenue recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation.

2.3 Expenditure

Expenses are accounted for on accrual basis and provision is made for all known losses and liabilities.

2.4 Fixed Assets and depreciation

Fixed assets other than land (including site development) are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost (freight, duties, levies etc.) of bringing the asset to its working condition for its intended use and capitalization of interest and other expenses incurred uptothe date of commissioning.

Depreciation is provided on fixed assets on the Straight Line Method in accordance with the rates specified under Schedule XIV to the Companies Act, 1956 from the month following the month of acquisition/commissioning

2.5 Impairment of Assets

The carrying accounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the fixed assets. If any indication exists, an asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of the assets exceeds the recoverable amount.

2.6 Inventories

Inventories are stated at lower of cost and net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, packing material, stores and spares on first in first out basis. (ii) Stock in process and finished goods taking into account the annual average cost of materials

consumed, direct production expenses, interest, depreciation and related Government duties.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated

costs of completion and estimated costs necessary to make the sale.

2.7 Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the

transactions.

Current assets and liabilities in foreign currency are converted at the exchange rate prevailing at the year end and

exchange differences are recognized in the Profit and Loss Account.

2.8 Retirement and other employee benefits

Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the said fund are due. Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation done as per projected unit credit method, carried out by an independent actuary at the end of year.

2.9 Provision for Current and Deferred Tax

Provision for Current Tax is made after taking into consideration benefits admissible under the Income Tax Act. 1961. Deferred Tax resulting from ''timing difference'' between taxable and accounting income is computed using tax rates and laws that are enacted or substantively enacted by the Balance Sheet date.

Terms/Rights attached to the class of shares.

(a) The company has one class of equity shares having par value of Rs. 10 per Share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after the distribution of all preferential amounts in proportion to their shareholding.

Notes:

(a) The company has taken Term Loan from IFCI Venture Capital Fund Ltd. for a period of three years. The loan is secured by personal guarantees of promoters and collaterals.

(b) The company has taken vehicle loans where interest rates vary from 8.5% to 12.75% p.a. Tenor of these loans ranges from 3 to 5 years. Respective vehicles have been hypothecated to the lending institutions to secure their loans. Repayment of these loans is regular as per the fixed equated monthly instalments.

(c) The unsecured Inter Corporate Deposit outstanding as on 31st March 2013 has been paid off during the year 2013-14.

Notes:

(a) Deferred tax assets and Deferred tax liabilities have been offset wherever the company has a legally enforceable right to set off current tax assets against current tax liabilities.

(b) Deferred tax assets and Deferred tax liabilities relate to income taxes leived by the same taxation authority.

Note: All the above Short term Loan & advances are unsecured and considered good.

Other Notes

[24] The Company has not received any information from any of the suppliers of their being a Micro, Small or Medium Enterprise Unit under the Micro, Small and Medium Enterprises Development Act, 2006. Hence, amounts due to Micro and Small Scale Enterprises outstanding as on March 31st 2014 are not ascertainable.

[25] On the basis of actuarial valuation, as per the projected unit credit method by an insurance company, the company has made a suitable provision in the accounts for the payment of gratuity. The details as required to be stated as per "AS-15 Employee Benefits" have not been made available by the said insurance company, hence not given.


Mar 31, 2013

1.1 Basis for preparation of accounts

Company mainiains its accounts an actual rolling the historical cost convention in accordance with generally accepted account™ £>nncip''DS fGAAF ) in compliance wiiti rha jjrcvrsiDnE o< 1hs ComisFihifs Act,1956 and the Accounting Standards prescribed in the Comoanies I Accounlmo blardardEj Rules. ^OOSmitHjed by tht Central Government under section 211 (3c) of the Companies Act 1956

Company''s normal operating cycle and other criteria set out in the rh® Con?pa,|,e?s Ac['' ''95^ Based on the nature of products and the time between acquisition of assets for processing and mpan^ Whined its operating cycle as 70 days forthe purpose of current/non-current

1.2 Revenue recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation.

1.3 Expenditure .

Expenses are accounted for on accrual basis and provision is made for all know losses and liabilities.

Fixed Assets and depreciation

evel°Pme"t) are stated at cost less accumulated depreciation and impairment losses if any Cost

and Cf3 f prl*6 a?''attrlbutable cost (frei9ht, duties, levies etc.) of bringing the asset to its working condition for its intended use

and capitalization of interest and other expenses incurred upto the date of commissioning. ubiruenaea use

thp°mnntdh^NfiXed a?r''S on the(Strai?ht Llne Method accordance with the rates specified under Schedule XIV to the Companies Act, 1956 from the month following the month of acquisition/commissioning.

1.4 Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the carcvina

amount of the fixed assets. If any indication exists, an asset''s recoverable amount is estimated. An impairment loss is recognized wheneve?the carrying amount of the assets exceeds the recoverable amount. recognizeo wneneverthe

1.5 Inventories

Inventories are stated at lower of costand net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, Packing material, stores and spares on first in first out basis

1.6 Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions

1.7 Retirement and other employee benefits

Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the said fund are due.

Gratuity liability is a defined benefit obligation and rs provided for on the basis of an actuarial valuation done as per projected unit credit method deferred * ''ndependent aC,Uary at the end of *ear'' Ac,uarial gains/losses are immediately taken to profit and i^ss accoum atd a"e noi

Provision for Current and Deferred Tax

After taking into consideration benefits admissible underthe Income Tax Act. 1961.


Mar 31, 2012

1.1 Basis for preparation of accounts

The Company maintains its accounts on accrual basis following the historical cost convention in accordance with generally accepted accounting principles (GAAP), in compliance with the provisions of the Companies Act,1956 and the Accounting Standards prescribed in the Companies (Accounting Standards) Rules,2006 notified by the Central Government under section 211(3c) of the Companies Act 1956.

All assets and liabilities have been classified as current or non current as per the Company's normal operating cycle and other criteria set out in the Revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 70 days for the purpose of current/non-current classification of assets and liabilities.

1.2 Revenue recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation.

1.3 Expenditure

Expenses are accounted for on accrual basis and provision is made for all know losses and liabilities.

1.4 Fixed Assets and depreciation

Fixed assets other than land (including site development) are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost (freight, duties, levies etc.) of bringing the asset to its working condition for its intended use and capitalization of interest and other expenses incurred upto the date of commissioning.

Depreciation is provided on fixed assets on the Straight Line Method in accordance with the rates specified under Schedule XIV to the Companies Act, 1956 from the month following the month of acquisition/commissioning.

1.5 Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the fixed assets. If any indication exists, an asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of the assets exceeds the recoverable amount.

1.6 Inventories

Inventories are stated at lower of cost and net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, Packing material, stores and spares on first in first out basis.

(ii) Stock-in-process and finished goods taking into account the annual average cost of materials consumed, direct production expenses, interest, depreciation and related Government duties.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

1.7 Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions. Current assets and liabilities in foreign currency are converted at the exchange rate prevailing at the year end and exchange differences are recognized in the Profit and Loss Account.

1.8 Retirement and other employee benefits

Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the said fund are due.

Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation done as per projected unit credit method, carried out by an independent actuary at the end of year. Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

1.9 Provision for Current and Deferred Tax

Provision for Current Tax is made after taking into consideration benefits admissible under the Income Tax Act. 1961. Deferred Tax resulting from 'timing difference' between taxable and accounting income is computed using tax rates and laws that are enacted or substantively enacted by the Balance Sheet date.


Mar 31, 2011

1. Basis of accounting

The Company maintains its accounts on accrual basis following the historical cost convention in accordance with generally accepted accounting principles (GAAP), in compliance with the provisions of the Companies Act, 1956 and the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 notified by the Central Government under section 211 (3c) of the Companies Act 1956.

The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and disclosures of contingent liabilities on the date of the financial statements. Examples of such estimates include provision for doubtful debts/advances, future obligations in respect of retirement benefits etc. Difference if any between the actual results and estimates is recognized in the period in which the amounts are crystallized.

2. Fixed Assets and depreciation

Tangible Assets

Fixed assets other than land (including site development) are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost (freight, duties, levies etc.) of bringing the asset to its working condition for its intended use and capitalization of interest and other expenses incurred up to the date of commissioning.

Depreciation is provided on fixed assets on the Straight Line Method in accordance with the rates specified under Schedule XIV to the Companies Act, 1956 from the month following the month of acquisition/commissioning.

Intangible Assets

Trade Marks/Copyrights and Brands are accounted at cost which is amortized over a period of five years.

3. Inventories

Inventories are stated at lower of cost and net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, Packing material, stores and spares on first in first out basis.

(ii) Stock-in-process and finished goods taking into account the annual average cost of materials consumed, direct production expenses, interest, depreciation and related Government duties.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

4. Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions.

Current assets and liabilities in foreign currency are converted at the exchange rate prevailing at the year end and exchange differences are recognized in the Profit and Loss Account.

5. Revenue recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation. '

6. Retirement and other employee benefits

Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the profit and loss account of the year when the contributions to the said fund are due.

Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation done as per projected unit credit method, carried out by an independent actuary at the end of year. Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

7. Provision for Current and Deferred Tax

Provision for Current Tax is made after taking into consideration benefits admissible under the Income Tax Act. 1961. Deferred Tax resulting from 'timing difference' between taxable and accounting income is computed using tax rates and laws that are enacted or substantively enacted by the Balance Sheet date.

Deferred tax asset is recognized only to the extent that there is reasonable certainly that asset will be realized in future.

8. Impairment

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the carry ing amount of the fixed assets. If any indication exists, an asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of the assets exceeds the recoverable amount.


Mar 31, 2010

1. Basis of accounting

The-Company maintains its accounts on accrual basis following the historical cost convention in accordance with Generally Accepted Accounting Principles (GAAP), in compliance with the provisions of the Companies Act, 1956 and the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 notified by the Central Government under section 211 (3c) of the Companies Act 1956

The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and disclosures of contingent liabilities on the date of the financial statements. Examples of such estimates include provision for doubtful debts/advances, future obligations in respect of retirement benefits etc. Difference if any between the actual results and estimates is recognized in the period in which the amounts are crystallized.

2. Fixed Assets and depreciation

Tangible Assets

Fixed assets other than land (including site development) are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost (freight, duties, levies etc.) of bringing the asset to its working condition for its intended use and capitalization of interest and other expenses incurred upto the date of commissioning.

Depreciation is provided on fixed assets on the Straight Line Method at the rates prescribed under Schedule XIV to the Companies Act, 1956 from the month following the month of acquisition/commissioning.

Intanqible Assets

Trade Marks/Copyrights and Brands are accounted at cost which is amortized over a period of five years.

3. Inventories

Inventories are stated at lower of cost and net realizable value. Costs are arrived at as follows:

(i) Raw materials, components, Packing material, stores and spares on first in first out basis.

(ii) Stock-in-process and finished goods taking into account the annual average cost of materials consumed, direct production expenses, interest, depreciation and related Government duties.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

4. Foreign Currency Transaction

Transactions denominated in foreign currency are recorded at the exchange rate

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions.

Current assets and liabilities in foreign currency are converted at the exchange rate prevailing at the year end and exchange differences are recognized in the Profit and Loss Account.

5. Revenue recognition

All revenues are generally recognized on accrual basis except where there is uncertainty of ultimate realisation.

Sales are shown net of trade discounts and inclusive of Excise and other levies.

6. Retirement and other employee benefits

Provision for gratuity (unfunded) and leave encashment are determined and accrued on estimated basis.

7. Income taxes

Income Tax expense comprises of current income tax. Current income tax is computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognized subject to the consideration of prudence, on timing difference being the differences between taxable income and accounting income that originate in one period and is capable of reversal in one or more subsequent periods. Deferred tax asset is not recognized unless there are timing differences, the reversal of which will result in sufficient income or there is virtual certainty that sufficient future taxable income will be available against which such deferred tax asset can be realized.

8. Impairment

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the fixed assets. If any indication exists, an assets recoverable amount is estimated. An impairment loss is recognized wheneverthe carrying amount of the assets exceeds the recoverable amount.

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