Mar 31, 2015
2.1 Basis of Preparation of Financial Statements
The Financial Statements have been prepared to comply in all material
aspects with the Accounting Standards Specified under section 133 of
the Act, read with Rule 7 of the Companies (Accounts) Rules,2014, and
the relevant provisions of the Companies Act, 2013. The Financial
Statements have been prepared in accordance with the Generally Accepted
Accounting Principles in India under historical cost convention,
accrual basis and on going concern concept.
2.2 Use of estimate
The preparation of financial statements in conformity with generally
accepted accounting principles in India requires the Management to make
estimates and assumptions considered in the reported amounts of assets
and liabilities (including contingent liabilities) as on the date of
the financial statements and the reported income and expenses during
the reported period. The Management believes that the estimates used in
preparation of the financial statements are prudent and reasonable.
Future results could differ due to these estimates and the differences
between the actual results and the estimates are recognized in the
periods in which the results are known / materialize.
2.3 Fixed Assets and Depreciation
Tangible Assets are stated at original cost less accumulated
depreciation. Cost of acquisition is inclusive of all costs incidental
to acquisition, installation, commissioning and related pre-operative
expenses and excluding recoverable taxes including interest paid on
funds borrowed during construction period until the assets is put to
commercial use.
The cost of the tangible asset will be adjusted after acquisition of
such asset in accordance with increase or reduction in the liability of
the company as expressed in Indian Currency for making payment towards
the whole or a part of the cost of the asset or for repayment of the
whole or part of monies borrowed by the company from any person
directly or indirectly in any foreign currency specifically for the
purpose of acquiring the asset (being in either case the liability
existing immediately before the date on which the change in rate of
exchange takes effect), the amount by which the liability is increased
or reduced during the year shall be added to or as the case may be
deducted from the cost, and the amount arrived at after such addition /
deduction shall be taken to be the cost of the tangible asset.
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumulated amortization / depletion. All costs, including
financing costs till commencement of commercial production, net charges
on foreign exchange contracts and adjustments arising from exchange
rate variations attributable to the intangible assets are capitalised.
Intangible assets are amortised over the useful life of the underlying
assets.
Depreciation on Fixed Assets is provided on Straight Line Method (SLM)
over the useful life of assets prescribed under Schedule II of
Companies Act, 2013 except in case of weaving mill Plant and Machinery
which are being depreciated over a period of useful life which is
different from the period stated as per Schedule II, based on internal
assessment and Independent Technical Evaluation.
2.4 Capital work in progress
Capital work-in-progress is stated at the amount expended upto the date
of Balance Sheet for the cost of fixed assets that are not yet ready
for their intended use. Expenditure (including financing cost relating
to borrowed funds for construction or acquisition of fixed assets)
incurred on projects under implementation are treated as Pre-operative
expenses pending allocation to the assets and are shown under "Capital
work-in-progress".
2.5 Impairment of Assets
Consideration is given at each balance sheet date to determine whether
there is any indication of impairment of the Company's fixed assets. If
any indication exists, an asset's recoverable amount is estimated. An
impairment loss is recognized whenever the carrying amount of an asset
exceeds its recoverable amount. The recoverable amount is determined
on the basis of value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value based on an
appropriate discount factor.
Reversal of impairment losses recognized in prior years is recorded
when there is an indication that the impairment losses recognized for
the asset no longer exist or have decreased. However, the increase in
the carrying amount of an asset due to reversal of an impairment loss
is recognized to the extent it does not exceed the carrying amount that
would have been determined (net of depreciation) had no impairment loss
been recognized for the asset in prior years.
2.6 Investments
Long-term investments are stated at cost, less provision for permanent
diminution in value. Current investments are stated at the lower of
cost or market value.
2.7 Borrowing Costs
Borrowing cost relating to (i) funds borrowed for acquisition of
qualifying fixed assets are capitalized till the date of commissioning
and thereafter charged to the Statement of Profit and Loss and (ii)
funds borrowed for other purposes are charged to the Statement of
Profit and Loss in the period in which they are incurred.
2.8 CENVAT
CENVAT claimed on Capital Goods is credited to Plant & Machinery
Account/Capital Work-in-Progress Account. CENVAT on purchases of Raw
materials and other material is deducted from the cost of such
materials.
2.9 Inventories
Inventories are valued at lower of cost or net realisable value after
providing for obsolescence, if any. Cost of inventory comprises of
purchase price, cost of conversion and other cost that have been
incurred in bringing the inventories to their respective present
location and condition. The valuations of various components of the
Inventories are as under:
i) Raw Materials are valued on Weighted Average basis; Stores, Spares
and Consumables are valued at FIFO basis and Cost includes applicable
taxes, duties, transport and handling costs.
ii) Finished Goods are valued at cost or net realisable value whichever
is lower. Cost is average cost and includes all material costs, direct
and indirect expenditure.
iii) Work In Progress is valued at cost inclusive of Overheads.
iv) Realisable Wastes are valued at estimated net realisable value as
the cost is not ascertainable.
2.10 Leases
Leases, where the lessor retains substantially all risks and rewards
incidental to the ownership are classified as operating leases.
Operating lease payments are recognised as an expense in statement of
profit and loss on straight line basis over the lease term.
2.11 Revenue recognition
Revenue is recognised to the extent 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 recognised when the significant
risks and rewards of ownership of goods are transferred to the customer
and is stated net of trade discounts, sales returns but incluse of Sale
Tax.
2.12 Other Income
Interest income is accounted on accrual basis. Dividend income is
accounted for when the right to receive it is established. Export
Incentives are accounted on accrual basis at the rates prevailing on
the date of transaction and as specified in the Govt policy.
2.13 Retirement benefits:
Liability for employee benefits, both short and long term, for present
and past services which are due as per the terms of employment are
recorded in accordance with Accounting Standard (AS 15 - Employee
Benefits) notified under the Companies Act, 2013. Accordingly, the
company has recognised the following three benefits.
i) Gratuity
The company has an obligation towards gratuity, a defined benefit
retirement plan covering eligible employees. The plan provides for a
lump sum payment to vested employees on retirement or death while in
employment or on termination of employment in an amount equivalent to
15 days salary payable for each completed year of service. Vesting
occurs upon completion of five years of service. The Gratuity plan of
the company is an unfunded plan. The Company accounts for the liability
for future gratuity benefits on the basis of an independent actuarial
valuation.
ii) Providend Fund
In accordance with applicable local laws, eligible employees of the
company are entitled to receive benefits under the provident fund, a
defined contribution plan to which both the employee and employer
contribute monthly at a determined rate. These contributions are either
made to the respective Regional Provident Fund Commissioner or the
Central Provident Fund under the state pension scheme and are expensed
as incurred.
iii) Leave Encashment
The accrual for unutilised leave is determined for the entire available
leave balances standing to the credit of the employees at the year end.
The value of such leave balance eligible for carry forward, is
determined at the year end and recognised in the statement of profit
and loss.
2.14 Foreign Currency Transactions
(i) Transactions denominated in foreign currencies are normally
recorded at the exchange rate prevailing at the time of the
transaction.
(ii) Monetary items denominated in foreign currencies at the year-end
are restated at year-end rates. In case of monetary items, which are
covered by forward exchange contracts, the difference between the year
end rate and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts has been
recognized over the life of the contract.
(iii) Any income or expense on account of exchange difference either on
settlement or on translation is recognized in the Profit and Loss
Account except in cases where they relate to acquisition of fixed
assets in which case they are adjusted to the carrying cost of such
assets.
(iv) In respect of forward exchange contracts in the nature of hedging
a) Premium or discount and exchange differences on the contracts is
amortized over the term of the contract
b) Exchange differences on the contract are recognized as profit or
loss in the period in which they arise.
(v) In respect of forward exchange contracts in the nature of
speculation, the value of contract is marked to its current market
value as at balance sheet and the gain or loss on contract is
recognized.
2.15 Taxation
Current Tax is the amount of tax payable on the taxable income for the
year as determined in accordance with the provisions of the Income Tax
Act, 1961.
Minimum Alternate Tax paid in accordance with the tax laws, which gives
future economic benefits in the form of adjustment to future income tax
liability, is considered as an asset if there is convincing evidence
that the company will pay normal income tax. Accordingly, MAT has been
recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow for the company.
Deferred tax is recognised on timing differences, being the differences
between the taxable income and the accounting incomes that originate in
one period are capable of reversal in one or more subsequent periods.
Deferred tax is measured using the tax rates and the tax laws enacted
or subsequently enacted as at the reporting date. Deferred tax
liabilities are recognised for all timing differences. Deferred tax
assets in respect of unabsorbed depreciation and carry forward losses
are recognised only if there is virtual certainty that there will be
sufficient future taxable income available to realise such assets.
Deferred tax assets and liabilities are set off if such items relate to
taxes on income levied by the same governing tax laws and the company
has a legally enforceable right for such set off. Deferred tax assets
are reviewed at each Balance Sheet date for their realisability.
2.16 Earnings per share
Basic earnings per share is computed by dividing the profit/(loss)
after tax (including the post tax effect of extra ordinary items, if
any) by the weighted average number of equity shares outstanding during
the year.
Diluted earnings per share is computed by dividing the profit/(loss)
after tax (including the post tax effect of any extra ordinary items,
if any) by the weighted average number of equity shares considered for
deriving basic earnings per share and also the weighted average number
of equity shares which could be issued on the conversion of all
dilutive potential equity shares.
2.17 Cash flow statement
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated with
investing or financing flows. The cash flows from operating, investing
and financing activities of the Company are segregated.
2.18 Provisions, contingent liabilities and contingent assets
Provision is recognised in respect of obligations where, based on the
evidence available, their existence at the Balance Sheet date is
considered probable.
A Contingent Liability is a possible obligation that arises from past
events whose existence will be confirmed by the occurrence or
non-occurrence of one or more uncertain future events beyond the
control of the company or a present obligation that is not recongnised
because it is not probable that an outflow of resources will be
required to settle the obligation. The Company does not recognise
Contingent Liability but disclose its existence in the Financial
Statements.
A Contingent Asset is not recognized in the accounts as a matter of
prudence.
Provisions, contingent liabilities and contingent assets are reviewed
at each balance sheet date.
2.19 Provisions for bad and doubtful debts
The company is reviewing all the trade receivables, loans and advances
and other receivables annually and makes provision every year on case
by case basis.
Mar 31, 2014
1. Accounting Convention:
The Financial statements are prepared based on historical cost
convention and in accordance with generally accepted accounting
principles.
2. Fixed Assets:
Fixed Assets are stated at cost net of deprectiation provided in the
statements. Costs of acquisitation of fixed assets is inclusive of all
direct and indirect expenditure upto the date of commercial use.
Depreciation is provided on straight line method in accordance with the
rates prescribed under Schedule XIV to the Companies Act,1956.
3. Inventories:
Inventories are valued at the lower of cost and net realisable value.
The cost of Rawmaterials are computed by using weighted average method.
Stores & Spares are computed by using FIFO method.
4. Derivative Transactions :
The company uses derivative financial instruments such principal only
swaps for the purpose of cost reduction. In case of loss the
transactions having protection are taken as contingent liability and
where protection is knocked out has been written off to profit & loss
a/c.
5. Investments:
Investments are stated at cost and diminution in the value, which is
permanent in nature, is provided for. Investments are stated at cost
or Net realisable value, which ever is lower.
6. Contingent Liabilities:
Liability in respect of contingent nature are mentioned by way of note
to accounts and will be paid / provided on crystallisation.
7. Employee Benefits :
As per AS 15 Employee benefits - the disclosure of employee benefits as
defined in the Accounting Standard are given Below :
Company''s contribution to PF determined under relevant statute and
charged to Revenue. The gratuity contribution has been made on the
basis of actuarial valuation determined under projected unit credit
method. Liability for Leave encashment is provided for on the basis of
the Accrued leaves at the close of the year.
8. Sales:
Sales Includes the amount receivable for goods sold including excise
duty,sales tax and export incentives, which are recognised on accrual
basis thereon and net of discounts.
9. Foreign Exchange Transactions:
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. The monetary assets and liabilities in
foreign currencies are translated at the rates of exchange ruling on
the Balance Sheet date or at the rates of exchange fixed under
contractual arrangements. Foreign currency assets and liabilities are
stated at the rate of exchange prevailing at the year end and resultant
gains / losses are recongnised in the Profit & Loss account
10. Accounting for Income Tax :
The Provision for taxation for the year, comprising of current tax and
deferred tax is based on tax liability computed in accordance with
relevant tax rates and tax laws as at the balance sheet date. Provision
for deferred tax is made for all timing differences arising between
taxable income and accounting income at rates that have been enacted or
substantively enacted as at the balance sheet date. Deferred tax assets
are recognised only if there is a reasonable certainty that they will
be realised and are reviewed for the appropriateness of their
respective Carrying value at each balance sheet date.
11. Earnings Per Share:
Basic earnings per share is calculated by dividing the net profit or
loss after tax for the year attributable to equity share holders by
weighted average number of equity shares outstanding during the year.
Mar 31, 2012
1. Accounting Convention:
The Financial statements are prepared based on historical cost
convention and in accordance with generally accepted accounting
principles.
2. Fixed Assets:
Fixed Assets are stated at cost net of depreciation provided in the
statements. Costs of acquisition of fixed assets is inclusive of all
direct and indirect expenditure upto the date of commercial use.
Depreciation is provided on straight line method in accordance with the
rates prescribed under Schedule XIV to the Companies Act,1956
3. Inventories:
Inventories are valued at the lower of cost and net realisable value.
The cost of Rawmaterials are computed by using weighted average method.
Stores & Spares are computed by using FIFO method.
4. Derivative Transactions :
The company uses derivative financial instruments such principal only
swaps for the purpose of cost reduction. In case of loss the
transactions having protection are taken as contingent liability and
where protection is knocked out has been written off to profit & loss
a/c
5. Investments:
Investments are stated at cost and diminution in the value, which is
permanent in nature, is provided for. Investments are stated at cost
or Net realisable value, which ever is lower.
6. Contingent Liabilities:
Liability in respect of contingent nature are mentioned by way of note
to accounts and will be paid/provided on crystallisation.
7. Employee Benefits :
As per AS 15 Employee benefits - the disclosure of employee benefits as
defined in the Accounting Standard are given Below :
Company's contribution to PF determined under relevant statute and
charged to Revenue. The gratuity contribution has been made on the
basis of actuarial valuation determined under projected unit credit
method. Liability for Leave encashment is provided for on the basis of
the Accrued leaves at the close of the year.
8. Sales:
Sales Includes the amount receivable for goods sold including excise
duty,sales tax and export incentives, which are recognised on accrual
basis thereon and net of discounts.
9. Foreign Exchange Transactions:
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. The monetary assets and liabilities in
foreign currencies are translated at the rates of exchange ruling on
the Balance Sheet date or at the rates of exchange fixed under
contractual arrangements. Foreign currency assets and liabilities are
stated at the rate of exchange prevailing at the year end and resultant
gains/losses are recognised in the Profit & Loss account.
10. Accounting for Income Tax:
The Provision for taxation for the year, comprising of current tax and
deferred tax is based on tax liability computed in accordance with
relevant tax rates and tax laws as at the balance sheet date. Provision
for deferred tax is made for all timing differences arising between
taxable income and accounting income at rates that have been enacted or
substantively enacted as at the balance sheet date. Deferred tax assets
are recognised only if there is a reasonable certainty that they will
be realised and are reviewed for the appropriateness of their
respective Carrying value at each balance sheet date.
11. Earnings Per Share:
Basic earnings per share is calculated by dividing the net profit or
loss after tax for the year attributable to equity share holders by
weighted average number of equity shares outstanding during the year.
Mar 31, 2010
1. Accounting Convention:
The Financial statements are prepared based on historical cost
convention and in accordance with generally accepted accounting
principles.
2. Fixed Assets:
Fixed Assets are stated at cost net of deprectiation provided in the
statements. Costs of acquisitation of fixed assets is inclusive of all
direct and indirect expenditure upto the date of commercial use.
Depreciation is provided on straight line method in accordance with the
rates prescribed under Schedule XIV to the Companies Act, 1956
3. Inventories:
Inventories are valued at the lower of cost and net realisable value.
The cost of Rawmaterials are computed by using weighted average method.
Stores & Spares are computed by using FIFO method.
4. Derivative Transactions :
The company uses derivative financial instruments such principal only
swaps for the purpose of cost reduction. In case of loss the
transactions having protection are taken as contingent liability and
where protection is knocked out has been written off to profit & loss
account.
5. Investments:
Investments are stated at cost and diminution in the value, which is
permanent in nature, is provided for.
6. Contingent Liabilities:
Liability in respect of contingent nature are mentioned by way of note
to accounts and will be paid / provided on crystallisation.
7. Employee Benefits :
As per AS 15 Employee benefits - the disclosure of employee benefits as
defined in the Accounting Standard are given Below :
Companys contribution to PF determined under relevant statute and
charged to Revenue. The gratuity contribution has been made on the
basis of actuarial valuation determined under projected unit credit
method. Liability for Leave encashment is provided for on the basis of
the Accrued leaves at the close of the year.
8. Sales:
Sales represent the amount receivable for goods sold including excise
duty and sales tax thereon and net of discounts . Incentives on export
sales are recognised as income on accrual basis.
9. Foreign Exchange Transactions:
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. The monetary assets and liabilities in
foreign currencies are translated at the rates of exchange ruling on
the Balance Sheet date or at the rates of exchange fixed under
contractual arrangements. Foreign currency assets and liabilities are
stated at the rate of exchange prevailing at the year end and resultant
gains / losses are recongnised in the Profit & Loss account
10. Accounting for Income Tax :
The Provision for taxation for the year, comprising of current tax and
deferred tax is based on tax liability computed in accordance with
relevant tax rates and tax laws as at the balance sheet date. Provision
for deferred tax is made for all timing differences arising between
taxable income and accounting income at rates that have been enacted or
substantively enacted as at the balance sheet date. Deferred tax assets
are recognised only if there is a reasonable certainty that they will
be realised and are reviewed for the appropriateness of their
respective Carrying value at each balance sheet date.
11. Lease Rentals :
Lease rentals in respect of leased equipment is being charged to the
Profit & Loss account.