Mar 31, 2015
1. Basis of preparation of financial statements
The accompanying financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles (GAAP) and comply with the Accounting Standards under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.
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 and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.
3. Fixed Assets
Fixed Assets are stated at cost of acquisition or construction less accumulated depreciation. Cost includes non-refundable taxes, duties, freight, borrowing costs and other incidental expenses related to the acquisition and installation of the respective assets.
Fixed assets which are found to be not usable or retired from active use or when no further benefits are expected from their use are removed from the books of account and the difference if any, between the cost of such assets and the accumulated depreciation thereon is charged to Statement of Profit & Loss.
Depreciation on the fixed assets is provided on straight-line method as per the rates and in manner prescribed in schedule XIV of the companies Act, 1956.
Raw materials, Stores & Spares and Work-in-process are valued at cost (Inclusive of taxes) or net realizable value whichever is lower. Finished goods are valued at cost or net realizable value whichever is lower.
6. Revenue recognition
Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership of products are transferred to customers. Revenue from domestic sales of products is recognized on dispatch of products. Revenue from products is stated inclusive of duties, taxes but exclusive of returns, and applicable trade discounts and allowances.
Interest accrues on the time basis, determined by the amount outstanding and the rate applicable.
7. Retirement Benefits
Retirement benefits to employees comprise of payments under Defined Contributions Plans like Provident Fund and payments under Defined Benefit Schemes like Gratuity and Leave Encashment Payment under Defined Contribution plans are charged to revenue on accrual.
8. Foreign Exchange Transactions.
Transactions denominated in foreign currency are accounted for initially at the exchange rate prevailing on the date of transaction and any gain or losses arising due to exchange differences arising on settlement are accounted for in the statement of profit or Loss.
Monetary items denominated in foreign currencies are translated at the rates prevailing on the date of Balance Sheet. Exchange differences on foreign exchange transactions other than those relating to fixed assets are recognized in the profit and loss account
9. Taxes on Expenses.
Deferred tax resulting from "Timing Difference" between book and taxable profit is accounted for using the tax rates and laws that are enacted or substantively enacted as on the Balance Sheet date. Deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.
Provision is made for tax on Income tax as per the applicable provisions of Income Tax Act, 1961.
10. Capital Subsidy
Capital subsidy includes amount received from Spices Board towards Grant in aid for adoption of hi-tech scheme "Inflow of Spice Processing " Rs. 50 00 000/- on against an obligation of exporting five times of the subsidy amount given in five years for which a bank guarantee of Rs. 50 Lakhs is given. The Capital Subsidy given is recognized as deferred revenue income over the estimated lifetime of machinery.