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Accounting Policies of United Textiles Ltd. Company

Mar 31, 2014

I) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

a) The financial statements are prepared under the historical cost convention as a going concern.

b) The Company follows the mercantile system of Accounting and recognises Income and Expenditure on Accrual basis. Accounting policies not specifically referred to otherwise are consistent and in consonance with the generally accepted accounting principles.

ii) SALES

Sales are inclusive of excise duty, if any. However, goods produced after 7th July, 2004 is exempt from excise duty.

iii) FIXED ASSETS AND DEPRECIATION

a) VALUATION OF FIXED ASSETS

Fixed assets are stated at cost of acquisition inclusive of all incidental expenses related thereto.

b) DEPRECIATION

Depreciation on all fixed assets have been provided on pro-rata basis on Written Down Value Method and at the rates specified in Schedule XIV of the Companies Act, 1956.

iv) INVENTORIES

The method of inventories valuation has been adopted as follows:- Raw Material, Stores and spares, finished goods is valued at lower of cost or net realisable value. Cost is determined on FIFO basis. Work in Process is valued at estimated cost or net realisable value whichever is lower. Cotton Waste is valued at estimated net realisable value. Finished goods and Work in Progress includes cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

v) INVESTMENTS

Long Term Investments are stated at cost. In case there is permanent diminution in the value of investments, provision for the same is made in the accounts.

vi) RETIREMENT BENEFITS

Liability in respect of retirement benefits is provided and / or funded and charged to profit and loss account as follows:- a) Provident/Family Pension as a percentage, of salary/ wages for eligible employees. b) Gratuity is accounted for on accrual basis, on the basis of actuarial valuation.

vii) TAXATION

a) Provision is made for income-tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income- Tax Act, 1961.

b) Deferred tax is accounted at the current rate of tax to the extent of temporary timing differences that originates in one year and are capable of reversal in one or more subsequent years. However, no deferred tax asset is created where there is no virtual certainty as to the sufficient future taxable profit.

viii) CONTINGENT LIABILITIES

Contingent Liabilities are not provided for in the accounts and are disclosed by way of note.


Mar 31, 2012

I) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

a) The financial statements are prepared under the historical cost convention as a going concern.

b) The Company follows the mercantile system of Accounting and recognizes Income & Expenditure on Accrual basis. Accounting policies not specifically referred to otherwise are consistent and in consonance with the generally accepted accounting principles.

ii) SALES

Sales are inclusive of excise duty, if any. However, goods produced after la July, 2004 is exempt from excise duty.

iii) FIXED ASSETS AND DEPRECIATION

a) VALUATION OF FIXED ASSETS

Fixed assets are stated at cost of acquisition inclusive of all incidental expenses related thereto.

b) DEPRECIATION

Depreciation on all fixed assets have been provided on pro-rata basis on Written Down Value Method and at the rates specified in Schedule XIV of the Companies Act, 1956.

iv) INVENTORIES

The method of inventories valuation has been adopted as follows:- Raw Material, Stores and spares, finished goods is valued at lower of cost or net realisable value. Cost is determined on FIFO basis. Work in Process is valued at estimated cost or net realisable value whichever is lower. Cotton W aste is valued at estimated net realisable value. Finished goods and Work in Progress includes cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

v) INVESTMENTS

Long Term Investments are stated at cost. In case there is permanent diminution in the value of investments, provision for the same is made in the accounts.

vi) RETIREMENT BENEFITS Liability in respect of retirement benefits is provided and / or funded and charged to profit and loss account as follows:-

a) Provident/Family Pension as a percentage, of salary/ wages for eligible employees.

b) Gratuity is accounted for on accrual basis, on the basis of actuarial valuation. vii) TAXATION

(a) Provision is made for income-tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income- Tax Act, 1961.

(b) No Deferred tax assets has been created in view of the virtual certainty supported by enhancing evidence that sufficient taxable income will be available in the next year against which the deferred assets can be realized.

viii) CONTINGENT LIABILITIES

Contingent Liabilities are not provided for in the accounts and are disclosed by way of note.


Mar 31, 2010

I) a) The financial statements are prepared under the historical cost convention as a going concern.

b) The Company follows the mercantile system of Accounting and recognizes Income & Expenditure on Accrual basis. Accounting policies not specifically referred to otherwise are consistent and in consonance with the generally accepted accounting principles.

ii) SALES

Sales are inclusive of excise duty, if any. However, goods produced after 7th July,2004 is exempt from excise duty.

iii) FIXED ASSETS AND DEPRECIATION

a) VALUATION OF FIXED ASSETS

Fixed assets are stated at cost of acquisition inclusive of all incidental expenses related thereto.

b) DEPRECIATION

Depreciation on all fixed assets have been provided on pro-rata basis for the period of use on Straight Line Method and at the rates specified in Schedule XIV of the Companies Act, 1956.

iv) INVENTORIES

The method of inventories valuation has been adopted as follows:-

Raw Material, Stores and spares, finished goods is valued at lower of cost or net realisable value. Cost is determined on FIFO basis.

Work in Process is valued at estimated cost or net realisable value whichever is lower.

Cotton Waste is valued at estimated net realisable value.

Finished goods and Work in Progress includes cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

v) INVESTMENTS

Long Term Investments are stated at cost. In case there is permanent diminution in the value of investments, provision for the same is made in the accounts.

vi) RETIREMENT BENEFITS

Liability in respect of retirement benefits is provided and / or funded and charged to profit and loss account as follows:-

a) Provident/Family Pension as a percentage, of salary/ wages for eligible employees.

b) Gratuity is accounted for on accrual basis, on the basis of actuarial valuation.

vii) TAXATION

(a) Provision is made for income-tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income- Tax Act, 1961.

(b) No Deferred tax assets has been created in view of the virtual certainty supported by enhancing evidence that sufficient taxable income will be available in the next year against which the deferred assets can be realized.

viii) CONTINGENT LIABILITIES

Contingent Liabilities are not provided for in the accounts and are disclosed by way of note.

 
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