Home  »  Company  »  Union Quality Pl  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Union Quality Plastics Ltd. Company

Mar 31, 2016

Note-24: ACCOUNTING POLICIES AND NOTES TO ACCOUNT (A) SIGNIFICANT ACCOUNTING POLICIES {a) Teases of preparation

The financial statements have been p-pared to comply in al I material respects with the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared under the cost co n Vent ion on an ac cru a basis,

{b) Use of Estimates

The reparation of financial state merits in confirmatory with genera y accepted accounting principles requires the management lo make estimates and assumptions that effect the reported balances of assets and liabilities as of the date of the financial statements and ‘spoiled amounts of income and expenses during the period, Management believes that the estimates used in the preparation of Financial statements are prudent and reasonable, actual; results could differ from m estimates

{e} Employee Benefits

i. Revetment benefits in the form of Provident Fund are a defined contribution scheme and the contributions a recharged to the Profit and Loss Account of the year when the contribute to the respective funds are due. There are no other ob ligations other than the contribution payable to the respective trusts.

ii. Gratuity Inability is defined benefit obligations and is provided for on payment basis.

ill. Short term compensated absences are provided for one based on estimates. Long term compensated absences are provided for based on actuarial alum abort on projected unit credit method carried by an independent actuary as at end of the year.

iv, Actuarial gains/losses are immediately taken to profit and loss account and are not deferred,

v. Payments made under the Voluntary Retirement 5cne;ne are charged to the Profit and Loss account immediately.

{d| Fixed Assets

Fixed assets are stated at cost (or ravaged amounts, as the case may be), less accumulated depreciation and impairment losses if any. Fixed assets erected & commissioned have been capitalized at cast intruding other Indicative pansies relating Acquisition and installation.

(e) Depredation

i) Depreciation has been provided on written down value method at the rates calculated on the basis of remaining useful .if of the asset as specified in Schedule of the Companies Act, 2013.

i) Depreciation on additions is being provided on pro-rata basis from the date of such additions.

(f) impairment

The carrying amounts of assets are reviewed at each balance sheet dale if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount it :s the greater of the asset''s net selling price and value I n use. In assessing value in use, the estimated future cash Rows are discounted to their present value attire weighted avail post Of capital.

After impairment, depreciation 15 provided ort the revised carrying amount of the asset over its remaining useful life.

(el Leases

Assets acquired under finance eases are recognised in accordance with the method recommended by the ICAl. Lease payments are apportioned between finance charge and reduction of outstanding liabilities. The finance charge is a .coated to periods during lease term at a constant periodic rate of interest on the remaining balance of the liability.

(h) Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current Investments are carried at lower if cost and fair value determined on an Individual- investment basis. Long-term .investments are carried at cost However, provision for diminution in value is made to recognize a define other than temporary in the value of the invest rents,

(J) Inventories

Raw material, components, stores and spares:

tower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the Finished products in which they will be incorporated are expected to be sold at or above cost..

Net realizable value is the summated se ling price in the ordinary course of business, less estimated costs of comp ethic and estimated costs necessary to make the sale.

(j) Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue cabin be reliably measured,

Dividend

Dividend including Interim is accounted forehead declared.

All items of income/expenses are accounted for on accrual basis except for the following items which are accounted for on cash basis,

1) Encashment of avenge fatuity pa use to employees 2} Custom/Excise Duty on Material in bond,

3) Bonus

(k) ho reign currency translation

(i) Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange caste between the reporting currency and tree foreign currency at the date of the transaction.

(ii) Conversion

Foreign currency monetary items are reported using the closing rate at the end of the reporting period. Mon-monetary items which are carried terms of historical cost denominated n a foreign currency are reported using the exchange rate at the date of the transaction;: and non-monetary items which are carried at fair value or other similar Valuation denominated in a Foreign currency are reported using the exchange rates that existed when the values we predetermined,

(iii) Exchange Differences

Exchange differences arising on the settle innocent of monetary items or on reporting company''s monetary items at rates different from those at which they were Initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year it with they arise. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset

(If Taxes on Income

income Tax expense comprise of Current lax and Deferred Tax charge or credit, Tie current tax Is determined as the amount of tax payable in respect of taxable income for the year, as per the provisions of Income Tax Act, 19bl. T Company provides for Deferred Tax! ;arty based on the tax effect of Timing Differences resulting from the report at ''on of [tern in the financial statements and estimating its current income tax provision. Where these are brought forward fiscal allowances, deferred tax asset is recognized only if there''s virtual certainty of reanimation of such assets, Deferred tax assets and liabilities are reviewed as at each balance sheet date and restated as per current developments,

(iv) Borrowing Costs

Barrowling Costs attributable to the fixed assets during their const ruction/re notation and modernization are capitalized in accordance with AS-16 issued by ICAi. Such borrowing costs and apportioned on the average balance of Capital Work-In-Progress for the year. Other borrowing cost* are recognized as an expense in the period in which they are incurred.

(n) Earnings per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share holder* (after deducting preference dividends and aj$1bu table taxes, any) by tied weighted average number of equity shares outstanding during tree period. Party paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period.

For the purpose at calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and tie weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

(o) Provisions

Provisions involving a substantial degree of estimation 11 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 recognized buts disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement

(p) Segment Information

The Company tos only one business and geographical Segment viz. HDPF Tarpaulin and related products in India. Hence no further disclosures are required to be made as per AS-17 on segment reporting.

(q) Indirect Taxes

Excise Duty:

I) Excise Duty paying’ Din finished goods is accounted for on clearance of goods from the factory, an provision :s made for Excise Duty in respect of finished Goods lying the factory,

II) Canvas in respect of Excise Duty paid on purchase of Raw Materials, Stores and Capita'' goods is accounted for by reducing the purchase cost of the related goods

Custom Duty:

Custom Duty payable on Raw Materials, Stores, Spares and Components is accounted on clearance there of fro-Ti the boned warehouses.


Mar 31, 2015

(a) Basis of preparation

The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared under the historical cost convention on an accrual basis.

(b) Use of Estimates

The preparation of financial statements in confirmatory with generally accepted accounting principles requires the management to make estimates and assumptions that effect the reported balances of assets and liabilities as of the date of the financial statements and reported amounts of income and expenses during the period. Management believes that the estimates used in the preparation of financial statements are prudent and reasonable. actual; results could differ from estimates

(c) Employee Benefits:-

i. Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the Profit and Loss Account of the year when the contributions to the respective funds are due. There are no other obligations other than the contribution payable to the respective trusts.

ii. Gratuity liability is defined benefit obligations and is provided for on payment basis.

iii. Short term compensated absences are provided for on based on estimates. Long term compensated absences are provided for based on actuarial valuation on projected unit credit method carried by an independent actuary as at end of the year.

iv. Actuarial gains / losses are immediately taken to profit and loss account and are not deferred.

v. Payments made under the Voluntary Retirement Scheme are charged to the Profit and Loss account immediately.

(d) Fixed Assets

Fixed assets are stated at cost (or revalued amounts, as the case may be), less accumulated depreciation and impairment losses if any. Fixed assets erected & commissioned have been capitalized at cost including other incidental expenses relating to acquisition and installation.

(e) Depreciation

i) Depreciation has been provided on written down value method at the rates calculated on the basis of remaining useful life of the asset as specified in Schedule II of the Companies Act, 2013.

ii) Depreciation on additions is being provided on pro-rata basis from the date of such additions.

(f) Impairment

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/extemal factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset's net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

(g) Leases

Assets acquired under finance leases are recognised in accordance with the method recommended by the ICAI. Lease payments are apportioned between finance charge and reduction of outstanding liabilities. The finance charge is allocated to periods during lease term at a constant periodic rate of interest on the remaining balance of the liability.

(h) Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

(i) Inventories

Raw materials, components, stores and spares:

Lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on FIFO basis.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

(j) Revenue recognition

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.

Dividend

Dividend including Interim is accounted for when declared.

All items of income/ expenses are accounted for on accrual basis except for the following items which are accounted for on cash basis.

1) Encashment of leave and gratuity payable to employees

2) Custom /Excise Duty on Material in bond.

3) Bonus

(k) Foreign currency translation

(i) Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion

Foreign currency monetary items are reported using the closing rate at the end of the reporting period. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(iii) Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company's monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset

(l) Taxes on Income

Income Tax expense comprise of Current Tax and Deferred Tax charge or credit. The current tax is determined as the amount of tax payable in respect of taxable income for the year, as per the provisions of Income Tax Act, 1961. The Company provides for Deferred Tax Liability based on the tax effect of Timing Differences resulting from the reorganization of item in the financial statements and estimating its current income tax provision. Where there are brought forward fiscal allowances, deferred tax asset is recognized only if there is virtual certainty of realization of such assets. Deferred tax assets and liabilities are reviewed as at each balance sheet date and restated as per current developments.

(m) Borrowing Costs

Borrowing Costs attributable to the fixed assets during their construction/renovation and modernization are capitalized in accordance with AS-16 issued by ICAI. Such borrowing costs are apportioned on the average balance of Capital Work-In-Progress for the year. Other borrowing costs are recognized as an expense in the period in which they are incurred.

(n) Earnings per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are

(o) Provisions

Provisions involving a 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 recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement

(p) Segment Information

The Company has only one business and geographical Segment viz. HDPE Tarpaulene and related products in India. Hence no further disclosures are required to be made as per AS-17 on segment reporting.

(q) Indirect Taxes Excise Duty:

I) Excise Duty payable on finished goods is accounted for on clearance of goods from the factory, no provision is made for Excise Duty in respect of Finished Goods lying the factory.

II) Cenvat in respect of Excise Duty paid on purchase of Raw Materials, Stores and Capital goods is accounted for by reducing the purchase cost of the related goods

Custom Duty:

Custom Duty payable on Raw Materials, Stores, Spares and Components is accounted on clearance thereof from the boned warehouses.


Mar 31, 2014

(a) Basis of preparation

The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis.

(b) Use of Estimates

The preparation of financial statements in confirmatory with generally accepted accounting principles requires the management to make estimates and assumptions that effect the reported balances of assets and liabilities as of the date of the financial statements and reported amounts of income and expenses during the period. Management believes that the estimates used in the preparation of financial statements are prudent and reasonable. actual; results could differ from estimates

(c) Employee Benefits:-

i. Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the Profit and Loss Account of the year when the contributions to the respective funds are due. There are no other obligations other than the contribution payable to the respective trusts.

ii. Gratuity liability is defined benefit obligations and is provided for on payment basis.

iii. Short term compensated absences are provided for on based on estimates. Long term compensated absences are provided for based on actuarial valuation on proj ected unit credit method carried by an independent actuary as at end of the year.

iv. Actuarial gains / losses are immediately taken to profit and loss account and are not deferred.

v. Payments made under the Voluntary Retirement Scheme are charged to the Profit and Loss account immediately.

(d) Fixed Assets

Fixed assets are stated at cost (or revalued amounts, as the case may be), less accumulated depreciation and impairment losses if any. Fixed assets erected & commissioned have been capitalized at cost including other incidental expenses relating to acquisition and installation.

(e) Depreciation

i) Depreciation has been provided on written down value method corresponding to the rates prescribed under schedule XIV of the Companies Act 1956.

ii) Depreciation on additions is being provided on pro-rata basis from the date of such additions.

(f) Impairment

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows arc discounted to their present value at the weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

(g) Leases

Assets acquired under finance leases are recognised in accordance with the method recommended by the ICAI. Lease payments are apportioned between finance charge and reduction of outstanding liabilities. The finance charge is allocated to periods during lease term at a constant periodic rate of interest on the remaining balance of the liability.

(h) Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.]

(i) Inventories

Raw materials, components, stores and spares:

Lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on FIFO basis.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

(j) Revenue recognition

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.

Dividend

Dividend including Interim is accounted for when declared.

All items of income/ expenses are accounted for on accrual basis except for the following items which are accounted for on cash basis.

1) Encashment of leave and gratuity payable to employees

2) Custom /Excise Duty on Material in bond.

3) Bonus

(k) Foreign currency translation

(i) Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(ii) Conversion

Foreign currency monetary items are reported using the closing rate at the end of the reporting period. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(iii) Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset

(I) Taxes on Income

Income Tax expense comprise of Current Tax and Deferred Tax charge or credit. The current tax is determined as the amount of tax payable in respect of taxable income for the year, as per the provisions of Income Tax Act, 1961. The Company provides for Deferred Tax Liability based on the tax effect of Timing Differences resulting from the reorganization of item in the financial statements and estimating its current income tax provision. Where there are brought forward fiscal allowances, deferred tax asset is recognized only if there is virtual certainty of realization of such assets. Deferred tax assets and liabilities are reviewed as at each balance sheet date and restated as per current developments.

(m) Borrowing Costs

Borrowing Costs attributable to the fixed assets during their construction/renovation and modernization are capitalized in accordance with AS-16 issued by ICAI. Such borrowing costs are apportioned on the average balance of Capital Work-In-Progress for the year. Other borrowing costs are recognized as an expense in the period in which they are incurred.

(n) Earnings per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

(o) Provisions

Provisions involving a 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 recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement

(p) Segment Information

The Company has only one business and geographical Segment viz. HDPE Tarpaulene and related products in India. Hence no further disclosures are required to be made as per AS-17 on segment reporting.

(q) Indirect Taxes Excise Duty:

I) Excise Duty payable on finished goods is accounted for on clearance of goods from the factory, no provision is made for Excise Duty in respect of Finished Goods lying the factory.

II) Cenvat in respect of Excise Duty paid on purchase of Raw Materials, Stores and Capital goods is accounted for by reducing the purchase cost of the related goods

Custom Duty:

Custom Duty payable on Raw Materials, Stores, Spares and Components is accounted on clearance thereof from the boned warehouses.

Find IFSC