Mar 31, 2015
I. Basis of accounting and preparation of financial statements
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards notified under
the relevant provisions of the Companies Act, 2013.
Company follows the Mercantile System of Accounting and recognizes
Income and Expenditure on Accrual Basis otherwise specifically stated.
The Accounts are being prepared as a going concern on the historical
cost basis. Accounting Policies not referred to otherwise are
consistent with Generally Accepted Accounting Principles.
II. Revenue Recognition
Sales are recognised at the point of despatch. Other Income is
recognised as and when the same is accrued.
III. 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. Future results
could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which
the results are known / materialise.
IV. Valuation of Inventories
Inventories of Raw Materials, Consumable Stores & Spares, Stock in
trade of Trading Purchases and Stock-in-Process are valued at cost on
FIFO basis. Finished Goods and Scrap are valued at realizable value.
V. Cash and cash equivalents (for purposes of Cash Flow Statement)
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
VI. Cash flow statement
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
VII. Fixed assets / Tangible Assets
Fixed Assets are stated at cost less accumulated depreciation. The cost
of an asset comprises its purchase price and any directly attributable
cost of bringing the assets to working condition for its intended use
and also includes financing cost till commencement of commercial
production. In respect of assets taken on Leases, the same are
accounted for only on transfer of ownership to the Company and on
transfer cost.
VIII. Depreciation
The Depreciation on fixed assets has been provided on straight line
method, calculated based on the useful life of the assets as prescribed
in Schedule II to the Companies Act, 2013.
IX. Foreign Currency Transactions
Transactions in Foreign currencies are recorded at exchange rate
prevailing on the date of transaction. Monetary items denominated in
foreign currency are restated at the exchange rate prevailing on the
balance sheet date and exchange difference is accounted as provision
for foreign exchange fluctuation. Actual exchange differences arising
on realization/final settlement in Indian rupees are dealt with in the
Profit and Loss Account.
X. Employee retirement benefit
(i) Retirement benefits in the form of provident fund scheme whether in
pursuance of any law or otherwise is accounted on accrual basis and
charged to the profit & loss account of the year.
(ii) The Gratuity has been provided for on the basis of Actuarial
Valuation dated 07.05.2015, which was prepared on "Projected Unit
Credit Method" and Bonus to employees are provided for on accrual
basis.
(iii) The Company has adopted policy to pay the leave encashment on
yearly basis calculated as per calendar year to all eligible employees.
XI. Earnings per share
Basic earnings per share is computed by dividing the profit / (loss)
after tax (including the post tax effect of extraordinary 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 extraordinary
items, if any) as adjusted for dividend, interest and other charges to
expense or income relating to the dilutive potential equity shares, by
the weighted average number of equity shares considered for deriving
basic earnings per share and the weighted average number of equity
shares which could have been issued on the conversion of all dilutive
potential equity shares. Potential equity shares are deemed to be
dilutive only if their conversion to equity shares would decrease the
net profit per share from continuing ordinary operations. Potential
dilutive equity shares are deemed to be converted as at the beginning
of the period, unless they have been issued at a later date. The
dilutive potential equity shares are adjusted for the proceeds
receivable had the shares been actually issued at fair value (i.e.
average market value of the outstanding shares). Dilutive potential
equity shares are determined independently for each period presented.
The number of equity shares and potentially dilutive equity shares are
adjusted for share splits / reverse share splits and bonus shares, as
appropriate.
XII Taxes on Income
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 (MAT) 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
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
Deferred tax is recognised on timing differences, being the differences
between the taxable income and the accounting income that originate in
one period and are capable of reversal in one or more subsequent
periods. Deferred tax is measured using the tax rates and the tax laws
enacted or substantially 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 of
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 are recognised for timing differences of
other items only to the extent that reasonable certainty exists that
sufficient future taxable income will be available against which these
can be realised. Deferred tax assets and liabilities are offset 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.
XIII. Provisions and contingencies
A provision is recognized when the Company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions (excluding retirement
benefits) are not discounted to their present value and are determined
based on the best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and
adjusted to reflect the current best estimates. Contingent liabilities
are disclosed in the Notes.
XIV. Investments
Investments in India are stated at cost. Investment outside India
involving foreign currency transactions are being valued at the year
end rates.
XV. Business Segment
The company is engaged in business of manufacturing of yarn and trading
of cloth, which is in same business segment.
Mar 31, 2014
I. Basis of accounting and preparation of financial statements
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards notified under
the Companies (Accounting Standards) Rules, 2006 (as amended) and the
relevant provisions of the Companies Act, 1956. Company follows the
Mercantile System of Accounting and recognizes Income and Expenditure
on Accrual Basis otherwise specifically stated. The Accounts are being
prepared as a going concern on the historical cost basis. Accounting
Policies not referred to otherwise are consistent with Generally
Accepted Accounting Principles.
II. Revenue Recognition
Sales are recognised at the point of despatch. Other Income is
recognised as and when the same is accrued.
III. 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. Future results
could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which
the results are known / materialise.
IV. Valuation of Inventories
Inventories of Raw Materials, Consumable Stores & Spares, Stock in
trade of Trading Purchases and Stock-in-Process are valued at cost on
FIFO basis. Finished Goods and Scrap are valued at realizable value.
V. Cash and cash equivalents (for purposes of Cash Flow Statement)
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
VI. Cash flow statement
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
VII. Fixed assets / Tangible Assets
Fixed Assets are stated at cost less accumulated depreciation. The cost
of an asset comprises its purchase price and any directly attributable
cost of bringing the assets to working condition for its intended use
and also includes financing cost till commencement of commercial
production. In respect of assets taken on Leases, the same are
accounted for only on transfer of ownership to the Company and on
transfer cost.
VIII. Depreciation
The Depreciation has been provided on straight line method at the rates
as specified in Schedule XIV of the Companies Act, 1956.
IX. Foreign Currency Transactions
Transactions in Foreign currencies are recorded at exchange rate
prevailing on the date of transaction. Monetary items denominated in
foreign currency are restated at the exchange rate prevailing on the
balance sheet date and exchange difference is accounted as provision
for foreign exchange fluctuation. Actual exchange differences arising
on realization/final settlement in Indian rupees are dealt with in the
Profit and Loss Account.
X. Employee retirement benefit
(i) Retirement benefits in the form of provident fund scheme whether in
pursuance of any law or otherwise is accounted on accrual basis and
charged to the profit & loss account of the year.
(ii) The Gratuity has been provided for on the basis of Actuarial
Valuation dated 03.05.2014, which was prepared on "Projected Unit
Credit Method" and Bonus to employees are provided for on accrual
basis.
(iii) The Company has adopted policy to pay the leave encashment on
yearly basis calculated as per calendar year to all eligible employees.
XI. Earnings per share
Basic earnings per share is computed by dividing the profit / (loss)
after tax (including the post tax effect of extraordinary 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 extraordinary
items, if any) as adjusted for dividend, interest and other charges to
expense or income relating to the dilutive potential equity shares, by
the weighted average number of equity shares considered for deriving
basic earnings per share and the weighted average number of equity
shares which could have been issued on the conversion of all dilutive
potential equity shares. Potential equity shares are deemed to be
dilutive only if their conversion to equity shares would decrease the
net profit per share from continuing ordinary operations. Potential
dilutive equity shares are deemed to be converted as at the beginning
of the period, unless they have been issued at a later date. The
dilutive potential equity shares are adjusted for the proceeds
receivable had the shares been actually issued at fair value (i.e.
average market value of the outstanding shares). Dilutive potential
equity shares are determined independently for each period presented.
The number of equity shares and potentially dilutive equity shares are
adjusted for share splits / reverse share splits and bonus shares, as
appropriate.
XII Taxes on Income
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 (MAT) 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
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
Deferred tax is recognised on timing differences, being the differences
between the taxable income and the accounting income that originate in
one period and are capable of reversal in one or more subsequent
periods. Deferred tax is measured using the tax rates and the tax laws
enacted or substantially 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 of
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 are recognised for timing differences of
other items only to the extent that reasonable certainty exists that
sufficient future taxable income will be available against which these
can be realised. Deferred tax assets and liabilities are offset 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.
XIII. Provisions and contingencies
A provision is recognized when the Company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions (excluding retirement
benefits) are not discounted to their present value and are determined
based on the best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and
adjusted to reflect the current best estimates. Contingent liabilities
are disclosed in the Notes.
XIV. Investments
Investments in India are stated at cost. Investment outside India
involving foreign currency transactions are being valued at the year
end rates.
XV. Business Segment
The company is engaged in business of manufacturing of yarn and trading
of cloth, which is in same business segment.
Mar 31, 2013
I. Basis of accounting and preparation of financial statements
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards notified under
the Companies (Accounting Standards) Rules, 2006 (as amended) and the
relevant provisions of the Companies Act, 1956. Company follows the
Mercantile System of Accounting and recognizes Income and Expenditure
on Accrual Basis otherwise specifically stated. The Accounts are being
prepared as a going concern on the historical cost basis. Accounting
Policies not referred to otherwise are consistent with Generally
Accepted Accounting Principles.
II. Revenue Recognition
Sales are recognised at the point of despatch. Other Income is
recognised as and when the same is accrued.
III. 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. Future results
could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which
the results are known / materialise.
IV. Valuation of Inventories
Inventories of Raw Materials, Consumable Stores & Spares, Stock in
trade of Trading Purchases and Stock-in-Process are valued at cost on
FIFO basis. Finished Goods and Scrap are valued at realizable value.
V. Cash and cash equivalents (for purposes of Cash Flow Statement)
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
VI. Cash flow statement
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
VII. Fixed assets / Tangible Assets
Fixed Assets are stated at cost less accumulated depreciation. The cost
of an asset comprises its purchase price and any directly attributable
cost of bringing the assets to working condition for its intended use
and also includes financing cost till commencement of commercial
production. In respect of assets taken on Leases, the same are
accounted for only on transfer of ownership to the Company and on
transfer cost.
VIII. Depreciation
The Depreciation has been provided on straight line method at the rates
as specified in Schedule XIV of the Companies Act, 1956.
IX. Foreign Currency Transactions
Transactions in Foreign currencies are recorded at exchange rate
prevailing on the date of transaction. Monetary items denominated in
foreign currency are restated at the exchange rate prevailing on the
balance sheet date and exchange difference is accounted as provision
for foreign exchange fluctuation. Actual exchange differences arising
on realization/final settlement in Indian rupees are dealt with in the
Profit and Loss Account.
X. Employee retirement benefit
(i) Retirement benefits in the form of provident fund scheme whether in
pursuance of any law or otherwise is accounted on
accrual basis and charged to the profit & loss account of the year.
(ii) The Gratuity has been provided for on the basis of Actuarial
Valuation dated 25.04.2013, which was prepared on "Projected
Unit Credit Method" and Bonus to employees are provided for on accrual
basis. (iii) The Company has adopted policy to pay the leave
encashment on yearly basis calculated as per calendar year to all
eligible employees
XI. Earnings per share
Basic earnings per share is computed by dividing the profit / (loss)
after tax (including the post tax effect of extraordinary 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 extraordinary
items, if any) as adjusted for dividend, interest and other charges to
expense or income relating to the dilutive potential equity shares, by
the weighted average number of equity shares considered for deriving
basic earnings per share and the weighted average number of equity
shares which could have been issued on the conversion of all dilutive
potential equity shares. Potential equity shares are deemed to be
dilutive only if their conversion to equity shares would decrease the
net profit per share from continuing ordinary operations. Potential
dilutive equity shares are deemed to be converted as at the beginning
of the period, unless they have been issued at a later date. The
dilutive potential equity shares are adjusted for the proceeds
receivable had the shares been actually issued at fair value (i.e.
average market value of the outstanding shares). Dilutive potential
equity shares are determined independently for each period presented.
The number of equity shares and potentially dilutive equity shares are
adjusted for share splits / reverse share splits and bonus shares, as
appropriate.
XII Taxes on Income
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 (MAT) 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
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
Deferred tax is recognised on timing differences, being the differences
between the taxable income and the accounting income that originate in
one period and are capable of reversal in one or more subsequent
periods. Deferred tax is measured using the tax rates and the tax laws
enacted or substantially 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 of
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 are recognised for timing differences of
other items only to the extent that reasonable certainty exists that
sufficient future taxable income will be available against which these
can be realised. Deferred tax assets and liabilities are offset 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.
XIII. Provisions and contingencies
A provision is recognized when the Company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions (excluding retirement
benefits) are not discounted to their present value and are determined
based on the best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and
adjusted to reflect the current best estimates. Contingent liabilities
are disclosed in the Notes.
XIV. Investments
Investments in India are stated at cost. Investment outside India
involving foreign current transactions are being valued at the year end
rates.
XV. Business Segment
The company is engaged in business of manufacturing of yarn and trading
of cloth, which is in same business segment.
Mar 31, 2012
I. Basis of accounting and preparation of financial statements
The financial statements ofthe Company have been prepared in accordance
with the Generally Accepted Accounting Principles in India (Indian
GAAP) to comply with the Accounting Standards notified under the
Companies (Accounting Standards) Rules, 2006 (as amended) and the
relevant provisions of the Companies Act, 1956. Company follows the
Mercantile System of Accounting and recognizes Income and Expenditure
on Accrual Basis otherwise specifically stated. The Accounts are being
prepared as a going concern on the historical cost basis. Accounting
Policies not referred to otherwise are consistent with Generally
Accepted Accounting Principles.
II. Revenue Recognition
Sales and Job Work Charges are recognised at the point of despatch.
Other Income is recognised as and when the same is accrued.
III. 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. Future results
could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which
the results are known / materialise.
IV. Valuation of Inventories
Inventories of Raw Materials, Consumable Stores & Spares, Stock in
trade of Trading Purchases and Stock-in-Process are valued at cost on
FIFO basis. Finished Goods and Scrap are valued at realizable value.
V. Cash and cash equivalents (for purposes of Cash Flow Statement)
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
VI. Cash flow statement
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities ofthe Company are
segregated based on the available information.
VII. Fixed assets / Tangible Assets
Fixed Assets are stated at cost less accumulated depreciation. The cost
of an asset comprises its purchase price and any directly attributable
cost of bringing the assets to working condition for its intended use
and also includes financing cost till commencement of commercial
production. In respect of assets taken on Leases, the same are
accounted for only on transfer of ownership to the Company and on
transfer cost.
VIII. Depreciation
The Depreciation has been provided on straight line method at the rates
as specified in Schedule XIV ofthe Companies Act, 1956.
IX. Foreign Currency Transactions
Transactions in Foreign currencies are recorded at exchange rate
prevailing on the date of transaction. Monetary items denominated in
foreign currency are restated at the exchange rate prevailing on the
balance sheet date and exchange difference is accounted as provision
for foreign exchange fluctuation. Actual exchange differences arising
on realization/final settlement in Indian rupees are dealt with in the
Profit and Loss Account.
X. Employee retirement benefit
(i) Retirement benefits in the form of provident fund scheme whether in
pursuance of any law or otherwise is accounted on accrual basis and
charged to the profit & loss account ofthe year.
(ii) The Gratuity has been provided for on the basis of Actuarial
Valuation dated 26.04.2012, which was prepared on "Projected Unit
Credit Method" and Bonus to employees are provided for on accrual
basis.
(iii) The Company has adopted policy to pay the leave encashment on
yearly basis calculated as per calendar year to all eligible employees
XI. Earnings per share
Basic earnings per share is computed by dividing the profit / (loss)
after tax (including the post tax effect of extraordinary 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 extraordinary
items, if any) as adjusted for dividend, interest and other charges to
expense or income relating to the dilutive potential equity shares, by
the weighted average number of equity shares considered for deriving
basic earnings per share and the weighted average number of equity
shares which could have been issued on the conversion of all dilutive
potential equity shares. Potential equity shares are deemed to be
dilutive only if their conversion to equity shares would decrease the
net profit per share from continuing ordinary operations. Potential
dilutive equity shares are deemed to be converted as at the beginning
of the period, unless they have been issued at a later date. The
dilutive potential equity shares are adjusted for the proceeds
receivable had the shares been actually issued at fair value (i.e.
average market value of the outstanding shares). Dilutive potential
equity shares are determined independently for each period presented.
The number of equity shares and potentially dilutive equity shares are
adjusted for share splits / reverse share splits and bonus shares, as
appropriate.
XII Taxes on Income
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 (MAT) 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
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
Deferred tax is recognised on timing differences, being the differences
between the taxable income and the accounting income that originate in
one period and are capable of reversal in one or more subsequent
periods. Deferred tax is measured using the tax rates and the tax laws
enacted or substantially 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 of
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 are recognised for timing differences of
other items only to the extent that reasonable certainty exists that
sufficient future taxable income will be available against which these
can be realised. Deferred tax assets and liabilities are offset 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.
XIII. Provisions and contingencies
A provision is recognized when the Company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions (excluding retirement
benefits) are not discounted to their present value and are determined
based on the best estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and
adjusted to reflect the current best estimates. Contingent liabilities
are disclosed in the Notes.
XIV. Investments
Investments in India are stated at cost. Investment outside India
involving foreign current transactions are being valued at the year end
rates.
XV. Business Segment
The company is engaged in business of manufacturing of yarn and trading
of cloth, which is in same business segment.
Mar 31, 2010
These financial statements have been prepared in accordance with the
Accounting Standards as prescribed by the Institute of Chartered
Accountants of India and referred to in Section 211 (3)(c)of the
Companies Act, 1956. Significant accounting policies adopted in the
presentation of the accounts are:
1. General
The Company follows the Mercantile System of Accounting and recognises
Income and Expenditure on Accrual Basis otherwise specifically stated.
The Accounts are prepared as a going concern on the historical cost
basis. Accounting Policies not referred to otherwise are consistent
with Generally Accepted Accounting Principles.
2. Fixed Assets and Depreciation
Fixed Assets are stated at cost less accumulated depreciation. The cost
of an asset comprises its purchase price and any directly attributable
cost of bringing the assets to working condition for its intended use
and also includes financing cost till commencement of commercial
production. In respect of assets taken on Leases, the same are
accounted for only on transfer of ownership to the Company and on
transfer cost. The Depreciation have been provided on straight line
method at the rates as specified in Schedule XIV of the Companies Act,
1956.
3. Foreign Currency Transaction
Transactions in Foreign currencies are recorded at exchange rate
prevailing on the date of transaction. Monetary items denominated in
foreign currency are restated.at the exchange rate prevailing on the
balance sheet date and exchange difference is accounted as provision
for foreign exchange fluctuation. Actual exchange difference arising on
realization/final settlement in Indian rupees are dealt with in the
Profit and Loss Account.
4. Investments
Investments in India are stated at cost. Investment outside India
involving foreign current transactions are being valued at the year end
rates.
5. Inventory Valuation
Inventories of Raw Materials, Consumable Stores & Spares, Stock in
trade of Trading Purchases and Stock-in-Process are valued at cost on
FIFO basis. Finished Goods and Scrap are valued at realizable value.
6. Revenue Recognition
Sales and Job Work Charges are recognised at the point of despatch.
Other Income is recognised as and when the same is accrued.
7. Gratuity, Bonus and Leave Encashment to Employees
The Gratuity has been provided for on the basis of Actuarial
Valuation-dated 26.04.2010, which was prepared on "Projected Unit
Credit Method" and Bonus to employees is provided for on accrual basis.
The Company has adopted policy to pay the leave encashment on yearly
basis calculated as per calendar year to all eligible employees.
8. Contingent Liability
Contingent Liabilities are not provided for and are disclosed by way of
Notes.
9. Taxation
The current charge for income taxes is calculated in accordance with
the relevant tax regulations applicable to the company. Deferred tax
assets and liabilities are recognised for future tax consequences
attributable to the timing difference that result between the profit
offered for income tax and profit as per the financial statements.
Deferred tax assets in respect of unabsorbed depreciation and carry
forward losses are recognized if there is virtual certainty that there
will be sufficient future taxable income available to realize such
losses. Similarly deferred tax liabilities, if any, are measured as per
the tax rate/laws that have been enacted or substantially enacted by
the Balance Sheet date.
10. Business Segment
The company is engaged in business of manufacturing of yarn and trading
of cloth, which is in same business segment.
11. Earnings per Share
The Company reports basic and diluted earnings per equity share in
accordance with AS-20, Earnings Per Share. Basic earning per equity
share has been computed by dividing net profit after tax by the
weighted average number of equity shares outstanding for the period.
Diluted earning per equity share has been computed using the weighted
average number of equity shares and dilutive potential equity shares
outstanding during the period.