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Notes to Accounts of Veljan Denison Ltd.

Mar 31, 2016

SIGNIFICANT ACCOUNTING POLICIES NOTE 24

The following are the significant accounting policies adopted by the company in the preparation and presentation of financial statements :

1. Financial Statements are prepared based on historical cost convention and in accordance with Generally Accepted Accounting Principles in India ("Indian GAPP") and Company with all Material respect with the Mandatory Accounting Standard ("AS") prescribed under section 133 of the Companies Act,2013 ("The Act") read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended ), and with relevant provisions of the Act and Pronouncements of the Institute of Chartered Accounts of India (ICAI). The Financial Statements have been prepared on Accrual basis . The Accounting Policies have been consistently applied by the Company are consistent with those used in the Previous Year.

2. Fixed assets are stated at cost net of Cenvat and Vat credit less accumulated depreciation. Cost of acquisition of Fixed assets is inclusive of freight, duties and taxes wherever input credits are not availed and cost of installation/refection expenses.

3. Depreciation is provided on Tangible assets in accordance with the useful life prescribed as per Schedule II of the Companies Act, 2013. Intangible asset software is written off over a period of 3 years.

4. Raw materials and consumables stores are valued at cost on weighted average method, Finished Goods and Work-in-Progress are valued at cost on weighted average method realizable value whichever less.

5. Jigs & Fixtures and Patterns are (valued after providing for) amortization at 20% and 10% respectively Under written down value method. Initial tools were capitalized and amortized at 10% on WDV value and further issue of tools are charged to revenue as and when issued.

6. Contributions to Provident Fund are remitted to the Provident Fund Commissioner at prescribed rates Group Gratuity Schemes administered through Trustees for which policies are taken from Life Insurance Corporation of India. The said remittances and premiums are charged to the revenue.

7. Liability in respect of Encashment of leave salary to the Employees of the company is provided for actual basis.

8. All contingent Liabilities are indicated by way of a note and will be provided/paid on crystallization.

9. Sales are inclusive of Excise duty, Sales tax and packing charges collected.

10. Provision for tax is made for both current and deferred taxes. Current Tax is provided on the taxable income using the applicable tax rates and tax laws.

11. Foreign currency transaction:

a) Transaction in foreign currency are initially accounted at the exchange rate prevailing on the date of transaction and adjusted appropriately to Capital or revenue, with the difference in the rate of exchange arising on actual receipt/payment during the year.

b) At each Balance Sheet date :

Foreign currency monetary items are reported using the rate of exchange on that date. Foreign currency non monetary items are reported using the exchange rate at which they are initially recognized.

12. Impairment of Assets:

At the date of each Balance Sheet, the company evaluates for indications of impairment internally if any to the carrying amounts of its fixed assets. If any indications exist, the recoverable amount is estimated at the higher of the realizable value and value in use, as considered appropriate. If the estimated realizable value is less than the caring amount, and impairment loss is recognized.

Reversal of impairment loss recognized in prior years is recorded when there is an indication that the impairment loss recognized for the asset no longer exist or have decreased. However, the increase in 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.


Mar 31, 2015

NOTE 1

The following are the significant accounting policies adopted by the company in the preparation and presentation of financial statements :


Mar 31, 2014

1. Term Loan from Andhra Pradesh State Financial Corporation is Secured by Way of First Charge on the Fixed Assets of the Company and Personal Guarantees of Two of the Directors of the company.

2. Against Hypothecation of Vehicles and Guaranteed by the One of the Director of the Company.

Working Capital Loans are secured by hypothecation of Raw Materials, Finished Goods, Book Debts and documentary bills discounted and second charges on the fixed Assets of the Company except the Vehicles Under Hypothecation, further Guaranteed by One Director of the company in their Capacities to the extent of Rs 2300 Lakhs.

Note 3

1. A) Contingent Liabilities not provided for :

a) Towards Guarantees and Letters of credit issued by the Bankers to the extent of 475.47 240.42

b) Bill discounted with bankers to the extent of 0.00 7.14

c) Interest claimed by District Industries Centre Sangareddy for delay in payment of instalments of Interest Free sales tax loan, which is contested by the Company 23.29 23.29

B) Contracts remaining to be executed on Capital account. 117.95 35.31

4. In the opinion of the management, the current assets, loans and advances are expected to realise the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

5. Balances in personal accounts are subject to confirmation and there by reconciliation

6. The company has Installed machinery worth Rs. 370.72 /- ,(previous year Rs. 370.72) in Ms Ecmat Ltd, for the job works given to them.


Mar 31, 2013

1. In the opinion of the management, the current assets, loans and advances are expected to realise the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

2. Balances in personal accounts are subject to confirmation and there by reconciliation

3. The company has Installed machinery worth Rs. 370.72 /- .(previous year Rs. 370.72) in MS Ecmat Ltd, for the job works given to them.

4. Consequent to the Notification Under the Companies Act, 1956 the financial statements for the Year ended 31st March, 2013 are prepared under Revised Schedule VI accordingly, the Previous year''s figures also have been reclassified to confirm to this Year''s classification.


Mar 31, 2012

1. Term Loan from Andhra Pradesh State Financial Corporation is Secured by Way of First Charge on the Fixed Assets of the Company and Personal Guarantees of Two of the Directors of the company.

Working Capital Loans are secured by hypothecation of Raw Materials, Finished Goods, Book Debts and documentary bills discounted and second charges on the fixed Assets of the Company except the Vehicles Under Hypothecation, further Guaranteed by One Director of the company in their Capacities to the extent of Rs 1010 Lakhs.

Current Year Previous Year Particulars 31-03-2012 31-03-2011 Rs. Rs.

1. A) Contingent Liabilities not provided for :

a) Towards Guarantees and Letters of credit issued by the Bankers to the extent of 91.80 129.22

b) Bills discounted with bankers to the extent of 45.80 3.17

c) Interest claimed by District Industries Centre Sangareddy for delay in payment of instalments of Interest Free sales tax loan, which is contested by the Company 23.29 23.29

B) Contracts remaining to be executed on Capital account. 23.88 66.81

2. Disclosure of Related party Transactions (As per AS-18)

Key Management Personnel (KMP)

Sri VC Janardan Rao : Chairman

Sri Srinivas VG : Managing Director

Directors

Sri GK Kabra

Sri ML Motwani

Sri V Pattabhi

Companies/Firms in which the key Management and their relations are interested

1. M/s. Veljan Hydrair Ltd - Common Control

2. M//s. Veljan Investments Ltd - Common Control

3 In the opinion of the Management, the Current Assets, loans and advances are expected to realise the amount at which they are stated, if realised in the ordinary course of Business and provision for all known liabilities have been adequately made in the accounts.

4 Balances in personal accounts are subject to confirmation and there by reconcilation.

5 The company has Installed Machinery worth Rs. 370.72(previous year Rs 370.72) In MS Ecmat Ltd, for the job works given to them.

6. Consequent to the Notification under the Companies Act, 1956, the financial statements for the year ended 31st March, 2012 are prepared under Revised Schedule VI accordingly, the Previous year's figures also have been reclassified to confirm to this year's classification.


Mar 31, 2011

Particulars Current Year Previous Year 31-03-2011 30-09-2009 Rs. Rs.

1. A) Contingent Liabilities not provided for:

a) Towards Guarantees and 12,921,571 4,256,363 Letters of credit issued by the Bankers to the extent of

b) Cheques discounted with bankers to the extent of 316,601 883,324

c) Interest claimed by Dist 2,328,929 2,328,929 rict Industries Centre Sanga reddy for delay in payment of instalments of Interest Free sales tax loan, which is contested by the Company

B) Contracts remaining to be executed on Capital 6,680,878 2,181,631 account.

2. Unclaimed dividends under "current Liabilities and provisions" not due for remittance to "Investors Education and Protection fund". Balances in current accounts with scheduled banks include Rs.64,74,833/- towards unclaimed dividends.

3. Segment Reporting : The entire operations of the Company relates only to one Segment i.e.'Hydraulics Products'. Hence no separate disclosure under segment reporting (AS -17) is required.

4. In the opinion of the management, the current assets, loans and advances are expected to realise the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

5. Balances in personal accounts are subject to confirmation and there by reconciliation

6. Due to micro, small and Enterprises: Out standing due to Micro, Small and Medium enterprises for a period exceeding 30 Days nil previous year nil.

7. The Company has Installed machinery worth Rs.3,70,72,415/-, (previous year Rs.7,23,36,741) in MS.Ecmat Ltd, for the job works given to them.

8. Disclosure of Related party Transaction (As per AS-18)

Key Management Personnel (KMP)

Sri V C Janardan Rao : Chairman

Sri Srinivas VG : Managing Director

Sri G K Kabra : Director

Directors

Sri M L Motwani Sri V Pattabhi

Companies/firms in which the key management and their relations are interested

1.M/s.Veljan Hydrair Ltd - Common Controls

2. M//s.Veljan Investments Ltd - Common Controls


Sep 30, 2009

1. Investments are stated at cost

2. Contributions to Provident Fund are remitted to the Provident Fund Commissioner at prescribed rates Group Gratuity Schemes administered through Trustees for which policies are taken from Life Insurance Corporation of India. The said remittances and premiums are charged to the revenue.

3. Liability in respect of Encashment of leave salary to the Employees of the company is provided for actual basis.

4. All contingent Liabilities are indicated by way of a note and will be provided/paid on crystallisation.

5. Sales are inclusive of Excise duty, Sales tax and packing charges collected.

6. Provision for tax is made for both current and deferred taxes. Current Tax is provided on the taxable income using the applicable tax rates and tax laws.

7 Impairment of Assets:

At the date of each Balance Sheet, the company evaluates for indications of impairment internally if any to the carrying amounts of its fixed assets. If any indications exist, the recoverable amount is estimedated at the higher of the realisable value and value in use, as considered appropriate. If the estimated realisable value is less than the earring amount, and impairment loss is recognised.

Reversal of impairment loss recognised in prior years is recorded when there is an indication that the impairment loss recognised for the asset no longer exist or have decreased. However, the increase in carrying amount of an asset due to reversal of an impairment loss is recognised to the extent it does not exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognised for the asset in prior years.

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