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Accounting Policies of Suryalata Spinning Mills Ltd. Company

Mar 31, 2014

A) Basis Of Preparation

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost convention and in accordance with the generally accepted accounting practices.

b) Fixed Assets

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956. Plant and Machinery depreciated on the basis of continuous process.

c) Inventories

Raw materials & Finished goods are valued at lower of cost or realizable value. Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in-process and stock-in-transit are valued at cost. Waste is valued at realizable value.

d) Investments

Investments are stated at cost and diminution in the value which is permanent in nature has been provided for

e) Foreign Exchange Transactions

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.

f) Contingent Liabilities

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts.

g) Retirement Benefits

Company''s contribution to Provident fund determined under the relevant statute are charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under AS15 given by SBI life insurance Company. The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

h) Accounting For Income Tax

Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

i) Deferred Income Tax

Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.

j) Sales

Sales represent the amount realised or realisable for goods sold including freight, excise duty, cess and sales tax thereon.


Mar 31, 2013

A) Basis Of Preparation

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost convention and in accordance with the generally accepted accounting practices.

b) Fixed Assets

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956. Plant and Machinery depreciated on the basis of continuous process.

c) Inventories

Raw materials & Finished goods are valued at lower of cost or realizable value. Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in-process and stock- in-transit are valued at cost. Waste is valued at realizable value.

d) Investments

Investments are stated at cost and diminution in the value which is permanent in nature has been provided for

e) Foreign Exchange Transactions

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.

f) Contingent Liabilities

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts.

g) Retirement Benefits

Company''s contribution to Provident fund determined under the relevant statute are charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under AS15 given by SBI life insurance Company. The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

h) Accounting For Income Tax

Current tax represents the amount that otherwise would have been payable under the Income- tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

i) Deferred Income Tax

Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.

j) Sales

Sales represent the amount realised or realisable for goods sold including freight, excise duty, cess and sales tax thereon.

h. Employee benefits : Gratuity

Consequent to the adoption of Accounting Standard on Employees Benefits (AS-15) (Revised 2005) issued by the Institute of Chartered Accountants of India, the following disclosures have been made as required by the Standard for Actuarial valuation of Gratuity.

The company has created a Trust namely SLSML Employees Gratuity Trust vide Trust deed dated 31st December, 2005 and obtained approvals from Income Tax Authorities vide letter No. CIT-III/10/GF/2005-06 dated 18.10.2006. SBI Life Insurance has been appointed for management of the Trust fund for the Benefit of the employees. The following tables summarize the components of net benefits.

i. In the opinion of the Board, the current assets and loans & advances have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated.

j. The company has opted for Drawback scheme on payment of excise duty for exports by availing cenvat credit on inputs for exports under Notification no :29/2004 (CE) dated 09.07.2004. The company has opted for zero rate of duty by not taking cenvat credit on inputs under central excise vide Notification no: 30/2004 (CE) dated 09.07.2004 for domestic sales other than milenge yarn. The product of Milenge yarn cleared on payment of excise duty by avail cenvat credit on inputs during the period from 01.04.2012 to 28.02.2013 and opted for zero rate of duty by not taking cenvat credit from 01.03.2013 due to zero rate of duty made on fabric in the Budget presented on 28.02.2013.


Mar 31, 2012

A) Basis Of Preparation

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost convention and in accordance with the generally accepted accounting practices.

b) Fixed Assets

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956. Plant and Machinery depreciated on the basis of continuous process.

c) Inventories

Raw materials & Finished goods are valued at lower of cost or realizable value. Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in-process and stock-in-transit are valued at cost. Waste is valued at realizable value.

d) Investments

Investments are stated at cost and diminution in the value which is permanent in nature has been provided for

e) Foreign Exchange Transactions

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.

f) Contingent Liabilities

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts.

g) Retirement Benefits

Company's contribution to Provident fund determined under the relevant statute are charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under AS15 given by SBI life insurance Company.

The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

h) Accounting For Income Tax

Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

i) Deferred Income Tax

Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.

j) Sales

Sales represent the amount realised or realisable for goods sold including freight, excise duty, cess and sales tax thereon.


Mar 31, 2011

BASIS OF PREPARATION :

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost convention and in accordance with the generally accepted accounting practices.

FIXED ASSETS :

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956. Plant and Machinery depreciated on the basis of continuous process.

INVENTORIES :

Raw materials & Finished goods are valued at lower of cost or realizable value. Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in-process and stock-in-transit are valued at cost. Waste is valued at realizable value.

INVESTMENTS :

Investments are stated at cost and diminution in the value which is permanent in nature has been provided.

DERIVATIVE INSTRUMENTS :

The company uses derivative financial instruments such as Principal only swaps for the purposes of cost reduction. In case of loss, the transactions having protection are taken as contingent liability and where protection is knocked in has been written off to profit and loss account.

FOREIGN EXCHANGE TRANSACTIONS :

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.

CONTINGENT LIABILITIES :

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts.

RETIREMENT BENEFITS :

Company's contribution to Provident fund determined under the relevant statute and charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under AS15 given by SBI life insurance Company.

The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

ACCOUNTING FOR INCOME TAX :

Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

DEFERRED INCOME TAX:

Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.

SALES:

Sales represent the amount realised or realisable for goods sold including freight, excise duty, cess and sales tax thereon.

MISCELLANEOUS EXPENDITURE :

Share issue expenditure is amortised over a period of ten years in equal installments.


Mar 31, 2010

BASIS OF PREPARATION :

The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The accounts are prepared on historical cost convention and in accordance with the generally accepted accounting practices.

FIXED ASSETS :

Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956. Plant and Machinery depreciated on the basis of continuous process.

INVENTORIES :

Raw materials, Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in- process and stock-in-transit are valued at cost. Finished goods are valued at lower of cost or realizable value. Waste is valued at realizable value.

INVESTMENTS :

Investments are stated at cost and diminution in the value which is permanent in nature has been provided.

DERIVATIVE INSTRUMENTS :

The company uses derivative financial instruments such as Principal only swaps for the purposes of cost reduction. In case of loss, the transactions having protection are taken as contingent liability and where protection is knocked in has been written off to profit and loss account.

FOREIGN EXCHANGE TRANSACTIONS :

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.

CONTINGENT LIABILITIES :

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts.

RETIREMENT BENEFITS :

Companys contribution to Provident Fund determined under the relevant statute and charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under Accounting Standard -15 given by SBI life insurance Company.

The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

ACCOUNTING FOR INCOME TAX :

Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

DEFERRED INCOME TAX :

Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.

SALES :

Sales represent the amount realised or realisable for goods sold including freight, excise duty, cess and sales tax thereon.

MISCELLANEOUS EXPENDITRE :

Share issue expenditure is amortised over a period of ten years in equal installments.

 
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