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Accounting Policies of SRK Industries Ltd. Company

Mar 31, 2015

1. Basis of preparation of financial statements

The financial statements have been prepared to comply with the Generally Accepted Accounting Principles in India (Indian GAAP), including the Accounting Standards notified under the relevant provision of the Companies Act, 2013. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company. The financial Statements are presented in Indian rupees rounded off to the nearest rupees.

2. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. 3. Fixed Assets

Fixed assets are stated at cost, less accumulated depreciation. Cost comprises the purchase price and all attributable cost of bringing the asset to its working condition for its intended use. Cost and other charges relating to acquisition of fixed assets are also included to the extent they relate to the period till such time as the assets are ready for commercial operation. 4. Depreciation / Amortization

Effective 1st April, the Company depreciates its fixed assets over the useful life in the manner prescribed in Schedule II of the Companies Act 2013, as against the earlier practice of depreciating at the rates and in the manner prescribed in Schedule II of the Companies Act, 2013.

Depreciation is provided using the useful life of the asset estimated by the management detail of which are as under :

Assets Estimated Useful Life

Computers 3 years

Printers 6 years

Office Equipment's 5 years

Software 1 years

Goodwill 10 years (W.e.f. 01.04.2015)

5 Intangible Assets

The Management is following the consistent practice of not amortising goodwill but is tested for impairment loss. As per the management there is no impairment loss on any of its assets including Goodwill during the year.

Goodwill recognised in the accounts will be amortised over a period of Ten years starting from 01.04.2015.

6. Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7. Investments

Investments are classified into Non-Current and Current Investments.

a) Non-Current Investments are carried at cost. Provision for diminution, if any, in the value of each Non-Current Investments is made to recognise a decline, other than of a temporary nature.

b) Current investments are carried individually at lower of cost and fair value and the resultant decline, if any, is charged to revenue.

8. Inventories

Inventory representing project work-in-progress is valued at cost, which includes expenditure incurred for development, other related cost and cost of land. Other inventories in the nature of textile goods are valued at Cost.

9. Revenue Recognition

All Income to the extent considered receivable, unless otherwise stated are accounted for on accrual basis. Revenue is recognised to the extent that it is probable that the economic benefit will flow to the company and revenue can be reliably measured.

Revenue from sale of goods is recognised when the sigificant risk & rewards of ownership of goods have passed to buyer. Sales are disclosed net of quality claims & rebates.

Sales are exclusive of vat and surcharge, if any.

10 Taxation

Tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of Profit and Loss for the year.

a. Current Tax

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income-tax Act, 1961.

b. Deferred Tax

Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and taxable income for the year. The deferred tax charge or credit and the deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax assets are recognised only to the extent there is virtual certainty that the assets can be realised in future.

11. Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account

12. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements

13. Government Grants

Rs. 13.38 Lacs is being disclosed as balance in 'subsidy Received from Government' under 'Reserve & Surplus' group on the balance sheet as on 31.03.2015. This had been received, as per management at the time of Grant of Sale Tax Loan. The Adjustment / utilisation of the credit balance is to be ascertained.

14. Segment Reporting

The company identifies primary segments based on the dominant source, nature of risks and returns and the internal organization and management structure. The operating segments are the segments for which separate financial management in deciding how to allocate resources and in assessing performance. The accounting policies adopted for segment reporting are in line with the accounting policies of the company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment

15. Cash and Cash Equivalents

The company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents


Mar 31, 2014

1. Basis of preparation of financial statements

The financial statements are prepared in accordance with applicable accounting standards and relevant provisions of the Companies Act, 1956 and are based on the historical cost conventions. Accounting policies unless specifically stated to be otherwise, are consistent and are in consonance with generally accepted accounting principles.

2 Presentation and disclosure of financial statements

Since the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company, for preparation and presentation of its financial statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements.

3. Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

4. Tangible and Intangible Fixed Assets

Tangible fixed assets are stated at cost of acquisition and subsequent improvements thereto; net of CENVAT / Value Added Tax, rebates, less accumulated depreciation, and impairment loss, if any.

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortizations and impairment loss, if any.

Goodwill recognized in accounts is not amortized but is tested for impairment, if any.

5. Depreciation/Amortization

Depreciation on tangible assets is provided on written down value basis at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956. Assets costing Rs5,000 or less are being fully depreciated in the year of acquisition.

6. Inventories

Inventories are valued at cost or market price whichever is less.

7. Employee Retirement Benefits

Short term employee benefits are charged off at the undiscounted amount in the period in which the related service is rendered. Retirement benefit, if any, to employees are accounted for on the basis of actual liability at the time of crystallization of the liability.

8 Provision for Current and Deferred Tax.

Provision for Current Income Tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

9. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events, it is probable that there will be an outflow of resources and a reliable estimate can be made of the amount of the obligation. These are reviewed at each balance sheet date and adjusted to reflect the current best estimate. Contingent Assets are neither recognized nor disclosed in the financial statement. Contingent Liabilities are not provided for and are disclosed by way of notes.

10 Revenue Recognition

All income to the extent considered receivable, unless otherwise stated, are accounted for on accrual basis. Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue from sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are disclosed net of quality claims and rebates.

11 Segment Reporting

The Company has identified that its operating segments are the primary segments. The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Company as a whole.

12 Cash and Cash Equivalents

Cash & cash equivalents in the cash flow statement comprise of cash at bank & in hand & short-term investments with an original maturity of three months or less.

13 Measurement of EBITDA

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the company has elected to present earnings before interest, tax, depreciation and amortization (EBITDA) as a separate line item on the face of the statement of profit and loss. The company measures EBITDA on the basis of profit/ (loss) from continuing operations. In its measurement, the company does not include depreciation and amortization expense, finance costs and tax expense


Mar 31, 2013

1 AS -1. DISCLOSURE AND BASIS OF ACCOUNTING

1. Financial Statements have been prepared under the Historical convention which is in accordance with the Generally Accepted Accounting Principles and provisions of the Companies Act, 1956. The Company has complied with the Accounting Standards prescribed by the Institute of Chartered Accountants of India (ICAI) and as referred U/s 211 (3C) of the Companies Act, 1956.

2. The accounts are prepared on the basis of going concern concept.

3. The company has been consistently following the accrual basis of accounting in respect of its income and expenditure.

2 AS-2. VALUATION OF INVENTORIES

The Finished goods are valued at Cost or market price whichever is lower.

3 AS-5. NETPROFIT/LOSS FOR THE PERIOD AND PRIOR ITEMS

1. All items of income and expenses pertaining to the year are included in arriving at the net profit for the year unless specially mentioned elsewhere in the financial statements or as required by accounting standards.

2. Prior period items are disclosed separately in the profit and loss accounts below the line.

4 AS-6. DEPRECIATION

Depreciation on fixed assets has been provided on W.D.V. method at the rates specified in Schedule XIV of the Companies Act, 1956. Depreciation has been provided on the addition of assets on pro-rata basis.

5 AS-9. REVENUE/ INCOME RECOGNITION

The Company recognize its revenue and expenditure on accrual basis.

6 AS -10. FIXED ASSETS

Fixed Assets are shown at cost less accumulated depreciation.

7 AS-15. EMPLOYEES'' BENEFITS

No Provision for gratuity is provided by the company since there is no employee who has been in continuous service of more than 5 years.

8 AS-18. RELATED PARTY DISCLOSURE

Key Management personnel

1. Mr.Rakeshchand M Jain - Chairman cum Managing Director

9 AS- 20 EARNING PER SHARE :The Earning per share is Rs 0.47

10 AS 22-TAXES ON INCOME

Provision for Deferred tax as on 31.03.2013 has not been made.

Current Tax is determined on the basis of taxable income and tax credit computed in accordance with provisions of Income Tax Act, 1961.

11 AS - 28. IMPAIRMENT OF ASSETS

An asset is impaired when the carrying amount of the assets exceeds its recoverable amount. An impairment loss is charged to Profit and loss account in the year in which an asset is identified as impaired.

a) The above loans /advances did not carry any charge for interest

b) The above related party information is disclosed to the extent such parties have been identified by the management on the basis of information available.

This is relied upon by the auditors.


Mar 31, 2012

1 AS -1. DISCLOSURE AND BASIS OF ACCOUNTING

1. Financial Statements have been prepared under the Historical convention which is in accordance with the Generally Accepted Accounting Principles and provisions of the Companies Act, 1956. The Company has complied with the Accounting Standards prescribed by the Institute of Chartered Accountants of India (ICAI) and as referred U/s 211(3C) of the Companies Act, 1956.

2. The accounts are prepared on the basis of going concern concept.

3. The company has been consistently following the accrual basis of accounting in respect of its income and expenditure.

4 AS-2. VALUATION OF INVENTORIES

The Finished goods are valued at Cost or market price whichever is lower.

5 AS-5. NETPROFIT/LOSS FORTHE PERIOD AND PRIOR ITEMS

6. All items of income and expenses pertaining to the year are included in arriving at the net profit for the year unless specially mentioned elsewhere in the financial statements or as required by accounting standards.

7. Prior period items are disclosed separately in the profit and loss accounts below the line.

8 AS-6. DEPRECIATION

Depreciation on fixed assets has been provided on W.D.V. method at the rates specified in Schedule XIV of the Companies Act, 1956. Depreciation has been provided on the addition of assets on pro-rata basis.

9 AS-9. REVENUE/ INCOME RECOGNITION

The Company recognise its revenue and expenditure on accrual basis.

10 AS-10. FIXED ASSETS

Fixed Assets are shown at cost less accumulated depreciation.

11 AS-15. EMPLOYEES' BENEFITS

No Provision for gratuity is provided by the company since there is no employee who has been in continuous service of more than 5 years.

12 AS- 20 EARNING PER SHARE: The Earning per share is Rs 0.02

13 AS 22-TAXES ON INCOME

Deferred tax as on 31.03.2012 has not been recognised since there is no certainty of sufficient taxable income being available against which such deferred tax assets can be realised.

14 AS-28. IMPAIRMENT OF ASSETS

An asset is impaired when the carrying amount of the assets exceeds its recoverable amount. An impairment loss is charged to Profit and loss account in the year in which an asset is identified as impaired.


Mar 31, 2011

1 AS -1. DISCLOSURE AND BASIS OF ACCOUNTING

1. Financial Statements have been prepared under the Historical convention which is in accordance with the Generally Accepted Accounting Principles and provisions of the Companies Act, 1956. The Company has complied with the Accounting Standards prescribed by the Institutue of Chartered Accountants of India (ICAI) and as referred U/s 211(3C) of the Companies Act, 1956.

2. The accounts are prepared on the basis of going concern concept.

3. The company has been consistently following the accrual basis of accounting in respect of its income and expenditure.

2 AS-2. VALUATION OF INVENTORIES

The Finished goods are valued at Cost or market price whichever is lower.

3 AS-5. NET PROFIT/LOSS FOR THE PERIOD AND PRIOR ITEMS.

1. All items of income and expenses pertaining to the year are included in arriving at the net profit for the year unless specically mentioned elsewhere in the financial statements or as required by accounting standards.

2. Prior period items are disclosed separately in the profit and loss accounts below the line.

4 AS-6. DEPRECIATION

Depreciation on fixed assets has been provided on W.D.V. method at the rates specified in Schedule XIV of the Companies Act, 1956. Depreciation has been provided on the addition of assets on pro-rata basis.

5 AS-9. REVENUE/ INCOME RECOGNITION

The Company recognises its revenue and expenditure on accural basis.

6 AS -10. FIXED ASSETS

Fixed Assets are shown at cost less accumualted depreciation.

7 AS-15. EMPLOYEES' BENEFITS

No Provision for gratuity is provided by the company since there is no employee who has been in continous service of more than 5 years.

8 AS-18. RELATED PARTY DISCLOSURE

Key Management personnel

1. Mr.T.N.Kutty - Chairman cum Managing Director

2. Mr. Rakeshchand M. Jain - Director

Related Party Transaction are as under : Remuneration paid to Managing Director Mr. T. N. Kutty Rs. 1,80,000/-

9 AS- 20 EARNING PER SHARE

The Earning per share is Rs. 0.04

10 AS 22- TAXES ON INCOME

Deferred tax as on 31.03.2011 has not been recognised since there is no certainty of sufficient taxable income being available against which such deferred tax assets can be realised.

11 AS - 28. IMPAIRMENT OF ASSETS

An asset is impaired when the carrying amount of the assets exceeds its recoverable amount. An impairment loss is charged to Profit and loss account in the year in which an asset is identified as impaired.


Mar 31, 2010

1 AS -1. DISCLOSURE AND BASIS OF ACCOUNTING

1. Financial Statements have been prepared under the Historical convention which is in accordance with the Generally Accepted Accounting Principles and provisions of the Companies Act, 1956. The Company has complied with the Accounting Standards prescribed by the Institutue of Chartered Accountants of India (ICAI) and as referred U/s 21I(3C) of the Companies Act, 1956.

2. The accounts are prepared on the basis of going concern concept.

3. the company has been consisitently following the accrual basis of accounting in respect of its income and expenditure.

2 AS-2. VALUATION OF INVENTORIES

The Finished goods are valued at Cost or market price whichever is lower.

3 AS-5. NET PROFIT/LOSS FOR THE PERIOD AND PRIOR ITEMS.

1. All items of income and expenses pertaining to the year are included in arriving at the net profit for the year unless specically mentioned elsewhere in the financial statements or as required by accounting standards.

2. Prior period items are disclosed separately in the profit and loss accounts below the line.

4 AS-6. DEPRECIATION

Depreciation on fixed assets( on vehicle only) has been provided on straight line method at the rates specified in Schedule XIV of the Companies Act, 1956. No depreciation is provided in respect of other assets since they are not put in to use during the year.

5 AS-9. REVENUE/ INCOME RECOGNITION

The Company recognises its revenue and expenditure on accural basis.

6 AS -10. FIXED ASSETS

Fixed Assets are shown at cost less accumualted depreciation.

7 AS-15. EMPLOYEES BENEFITS

No Provision for gratuity is provided by the company since there is no employee who has been in continous service of more than 5 years.

8 AS-18. RELATED PARTY DISCLOSURE

Key Management personnel

1 Mr.T.N.Kutty - Chairman cum Managing Director

2. Mrs. Geetha Narayanan - Director

Relatives of Key Management Personnel

l.Mrs.Thara- (Wife of Mr.T.N.Kutty)

Related Party Transaction are as under.

There are no transactions during the year

9 AS- 20 EARNING TER SHARE

Since the Company has incurred loss during the year, the earning per share is nil.

10 AS 22- TAXES ON INCOME

Deferred tax as on 31.03.2010 has not been recognised since there is no certainty of sufficient taxable income being available against which such deferred tax assets can be realised.

11 AS -28. IMPAIRMENT OF ASSETS

An asset is impaired when the carrying amount of the assets exceeds its recoverable amount. An impairment loss is charged to Profit and loss account in the year in which an asset is identified as impaired.

 
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