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Accounting Policies of Vyapar Industries Ltd. Company

Mar 31, 2015

A. Basis of preparation of financial statements

These financial statements have been prepared to comply with the generally accepted accounting principles in India (Indian GAAP), the Accounting Standards notified under the relevant provisions of the Companies Act, 2013.

The financial statements are prepared on accrual basis under the historical cost convention. The financial statements are presented in Indian rupees rounded off to the nearest rupee.

B. Use of Estimates

The preparation of financial statements in conformity with Indian (GAAP) requires judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

C. Fixed Assets Tangible Assets

Tangible Assets are stated at cost net of recoverable taxes, trade discounts and rebates, less accumulated depreciation and impairment loss, if any. The cost of tangible assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use.

Subsequent expenditures related to an item of tangible assets are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance.

D. Depreciation, Amortization and Depletion Tangible Assets

Depreciation on fixed assets is provided to the extent of depreciable amount on the Straight Line Method (SLM). Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

E. Impairment

An assets is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Statement in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

F. Foreign Currency Transactions

a) Transactions denominated in foreign currencies; if any, are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction

b) Monetary items denominated in foreign currencies at the year end; if any, are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts; if any, is recognized over the life of the contract.

c) Non monetary foreign currency items; if any, are carried at cost.

d) Any income or expense on account of exchange difference either on settlement or on translation; if any, is recognized in the Profit and Loss Statement.

G. Investments

Current investments are carried at lower of cost and quoted / fair value, computed category wise. Non Current Investments are stated at cost. Provision for diminution in the value of non current investments is made only if such a decline is other than temporary.

H. Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence and damage, if any. Cost of inventories comprises of cost of purchase, cost of conversion and other costs incidental to purchase in bringing them to their respective present location and condition.

Cost of trading and other products are determined on specific identification basis.

I. Revenue Recognition

Revenue is recognized only when risks and rewards incidental to ownership are transferred to the customer, it can be reliably measures and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods less excise duty, Value Added Tax (VAT) and adjusted for discounts (net).

Dividend income is recognized when right to receive payment is established.

Interest income is recognized on a time proportion basis taking into account the amount outstanding and interest rate applicable.

Rent income is recognized based on the mutual agreement between the parties on time proportion basis.

J. Employee Benefits Short-term employee benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognized as an expense during the period when the employees render the services. These benefits include performance incentive and compensated absences.

Post employment benefits Defined Contribution Plans

Defined Contribution Plan is a post employment benefit plan under which a Company pays specified contributions to a separate entity. The company does not make any contribution towards Defined Contribution Plan or towards Provident Fund, Superannuation Fund and Pension Scheme as it is not covered under the relevant Act.

Defined Benefit Plans

The liability in respect of defined benefits plan and other post employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from the employees' services.

Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss Statement.

K) Borrowing Costs

Borrowing costs; if any, include exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as a part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to the profit loss statement in the period in which they are incurred.

L) Income Taxes

Tax expenses comprises of current tax and deferred tax. Current tax is measured at the amount expected to be paid to the tax authorities, using the applicable tax rate. Deferred Income tax reflect the current period timing difference between taxable and accounting income for the period and reversal of timing differences of earlier years/period. Deferred tax assets are recognized only to the extent that there is a reasonable certainty that sufficient future income will be available except that deferred tax assets, incase there are unabsorbed depreciation or losses, are recognized if there is virtual certainty that sufficient future taxable income will be available to realize the same.

Deferred tax assets and liabilities are measured using the tax rates and tax law that have been enacted or substantively enacted by the Balance Sheet date.

M) Provisions, Contingent Liabilities and Contingent Assets

Provision involving 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 statements.


Mar 31, 2014

A. Basis of preparation of financial statements

These financial have been prepared to comply with accounting principles generally accepted in India (Indian GAAP), the Accounting Standards notified under The Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

The financial statements are prepared on accrual basis under the historical cost convention. The financial statements are presented in Indian rupees rounded off to the nearest rupee.

B. Use of Estimates

The preparation of financial statements in conformity with Indian (GAAP) requires judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

C. Fixed Assets

Tangible Assets

Tangible Assets are stated at cost net of recoverable taxes, trade discounts and rebates, less accumulated depreciation and impairment loss, if any. The cost of tangible assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use.

Subsequent expenditures related to an item of tangible assets are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance.

D. Depreciation, Amortization and Depletion

Tangible Assets

Depreciation on fixed assets is provided to the extent of depreciable amount on the Written Down Value (WDV) Method. Depreciation is provided at the rates and in the manner described in Schedule XIV to the Companies Act, 1956.

E. Impairment

An assets is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

F. Foreign Currency Transactions

a) Transactions denominated in foreign currencies; if any, are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction

b) Monetary items denominated in foreign currencies at the year end; if any, are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts; if any, is recognized over the life of the contract.

c) Non monetary foreign currency items; if any, are carried at cost.

d) Any income or expense on account of exchange difference either on settlement or on translation; if any, is recognized in the Statement of Profit and Loss.

G. Investments

Current investments are carried at lower of cost and quoted / fair value, computed category wise. Long term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary.

H. Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence and damage, if any. Cost of inventories comprises of cost of purchase and other costs incidental to purchase in bringing them to their respective present location and condition.

Cost of trading and other products are determined on specific identification basis.

I. Revenue Recognition

Revenue is recognized only when risks and rewards incidental to ownership are transferred to the customer, it can be reliably measures and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, Value Added Tax (VAT) and adjusted for discounts (net).

Dividend income is recognized when right to receive payment is established.

Interest income is recognized on a time proportion basis taking into account the amount outstanding and rate applicable.

Rent income is recognized based on the mutual agreement between the parties on time proportion basis.

J. Employee Benefits

Short-term employee benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognized as an expense during the period when the employees render the services.

Post employment benefits

Defined Contribution Plans

Defined Contribution Plan is a post employment benefit plan under which a Company pays specified contributions to a separate entity. The company does not make any contribution towards Provident Fund, Superannuation Fund and Pension Scheme as it is not covered under the relevant Act.

Defined Benefit Plans

The liability in respect of defined benefits plan is benefit plans and other post employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from the employees'' services.

Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

K) Borrowing Costs

Borrowing costs; if any, include exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as a part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to the statement of profit loss in the period in which they are incurred.

L) Income Taxes

Tax expenses comprises of current tax and deferred tax. Current tax is measured at the amount expected to be paid to the tax authorities, using the applicable tax rate. Deferred Income tax reflect the current period timing difference between taxable and accounting income for the period and reversal of timing differences of earlier years/period. Deferred tax assets are recognized only to the extent that there is a reasonable certainty that sufficient future income will be available except that deferred tax assets, incase there are unabsorbed depreciation or losses, are recognized if there is virtual certainty that sufficient future taxable income will be available to realize the same.

Deferred tax assets and liabilities are measured using the tax rates and tax law that have been enacted or substantively enacted by the Balance Sheet date.

M) Provisions, Contingent Liabilities and Contingent Assets

Provision is recognized in the accounts when there is a present obligation as a result of past event(s) and it is probable that there will be an outflow of resources will be required to settle the obligation and a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimate.

Contingent Liabilities are disclosed unless the possibility of outflow of resources is remote. Contingent Assets are neither recognized nor disclosed in the financial statements.

18.1 As per Accounting standard 15 "Employees benefit" the disclosures as defined in the Accounting standard are given below.

Defined Contribution Plan

No contribution has been made to defined contribution plans. The company does not made contribution to provident fund as they are not covered by Employees provident fund and Miscellaneous provision Act 1952.

Defined benefit plan

The company provision for gratuity is the defined benefit plan. The present value of the obligation is determined based on actuarial valuation using the Projected unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The company does not recognise leave encashment.


Mar 31, 2013

A. Basis of preparation of financial statements

The financial statements are prepared under the historical cost conventions on an accrual basis of accounting, in conformity with accounting principles generally accepted in India and complying in all material respects with the Accounting standards notified by companies (Accounting Standards) Rules, 2006 (As amended) and the relevant provisions of the companies Act, 1956 (''the Act''). The accounting policies have been consistently applied by the company and are consistent with those used in the previous years.

b. Use of Estimates

The preparation of the financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

C. Fixed Assets and Depreciation

Fixed Assets are stated at the cost of acquisition or construction less accumulated depreciation. The Company capitalizes all direct costs relating to the acquisition of respective fixed asset.

Depreciation on assets is provided using the written down value method at the rates prescribed under Schedule XIV of the Companies Act, 1956. Depreciation is calculated on pro-rata basis from / till the date of installation / disposal (sale).

D. Impairment of Assets

An assets is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the profit and loss account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting is reversed if there has been a change in estimate of recoverable amount.

E. Foreign Currency Transactions

a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction

b) Monetary items denominated in foreign currencies at the year end are restated at year end rates. In case of items which are covered by forward exchange contracts if applicable, the difference between the year end rate and rate on the date of the contract is recognised as exchange difference and the premium paid / received on forward contracts is recognised over the life of the contract.

c) Non monetary foreign currency items are carried at cost.

d) any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss account.

F. Investments

Current investments are carried at lower of cost and quoted / fair value, computed category wise. Long term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary

G. Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence and damage, if any. Cost of inventories comprises of cost of purchase and other costs incidental to purchase.

H. Revenue Recognition

Revenue is recognized only when it can be reliably measures and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, sales tax, Value Added Tax (VAT) and gain / loss on corresponding hedge contracts. Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

I. Sales Tax / Value Added Tax

Sales tax / value added tax paid is charged to profit and loss account. J. EMPLOYEE BENEFITS

a) short term employee benefits are recognised as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b) post employment and other long term employee benefits are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques, actuarial gains and losses in respect of post employment and other long term benefits are changed to the Profit and Loss account.

K. Borrowing Costs

All other borrowing costs are charged to the Profit and Loss account.

L. Provision for Current and Deferred Tax

Provision for current tax is made after taking into consideration benefits admissible under the provision of the income tax Act, 1961. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. Deferred tax asset is recognised and carried forward only to the extent that there is a virtual certainty that the assets will be realized in future.

M. Provisions, Contingent Liabilities and Contingent Assets

Provisions Involving 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 statements.


Mar 31, 2012

A. Basis of preparation of financial statements

The financial statements are prepared under the historical cost conventions on an accrual basis of accounting. in conformity With accounting principles generally accepted in India and complying in all material respects with the Accounting standards notified by companies (Accounting Standards) Rules. 2006 (As amended) and the relevant provisions of the companies Act, 1956. (the Act) The accounting policies have been consistently applied by the company and are consistent with those used in the previous years except for changes in accounting policies described in note 11 (c) below

b. Use of estimates

The preparation of the financial statements in conformity with the GAAP requires that the management to make estimates and assumption that affect the reported amount of assets and liabilities and the disclosure of contingent liabilities on the date of the financial statements and the results of operations during the reporting year end. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from those estimates, actual result could differs from those estimates.

c. Changes In accounting policy

Presentation and disclosure of financial statements.

During the year ended March 31.2012 the revised schedule VI notified under the act has become applicable to the company for the preparation and presentation of Its financial statement. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparations of financial statement However, it has significant impact on presentation and disclosures made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

All assets and liabilities have been classified as current or non-current as per the company's normal operating cycle and of her criteria set out in Revised Schedule VI of the Act

Based on the nature of the services and their realization in cash and cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current / non current classification of assets and liabilities.

D. Fixed Assets and Depreciation

Fixed Assets are stated at the cost of acquisition or construction less accumulated depreciation. The Company capitalizes all direct costs relating to the acquisition of respective fixed asset.

Depreciation on assets is provided using the written down value method al the rates prescribed under Schedule XIV of the Companies Act, 1956. Depreciation is calculated on pro-rata basis from / till the date of installation / disposal (sale).

E. Impairment of Assets

An assets is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the profit and loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting is reversed if there has been a change in estimate of recoverable amount.

F. Foreign Currency Transactions

a) Transaction denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction

b) Monetary items denominated in foreign currencies at the year end are restated at year end rates. In case of items which are covered by forward exchange contracts if applicable, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid/received on forward contracts is recognized over the life of the contract.

c) Non monetary foreign currency items are carried at cost

d) any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss account

G. Investments

Current investments are carried at lower of cost and quoted / fair value. computed category wise. Long term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary

H. Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence and damage, it any. Cost of inventories comprises of cost of purchase and of her costs incidental to purchase.

I. Revenue Recognition

Revenue is recognized only when it can be reliably measures and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, sales tax, excise duty adjusted for discounts (net). Value Added Tax (VAT) and gain/loss on corresponding hedge contracts. Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

J. Sales Tax / Value Added Tax

Sales tax / value added tax paid is charged to profit and loss account

K. EMPLOYEE BENEFITS

a) short term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b) post employment and of her long term employee benefits are recognized as an expense in the profit and loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actual valuation techniques, actuarial gains and losses in respect of post employment and of her long term benefits are changed to the profit and loss account.

L. Borrowing Costs

All of her borrowing costs are charged to the Profit and Loss account.

M. Provision for Current and Deferred Tax

Provision for current tax is made after taking into consideration benefits admissible under the provision of the income tax Act. 1961. Deferred tax resulting from "timing difference" between taxable and accounting income is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. Deferred tax asset is recognized and carried forward only to the extent that there is a virtual certainty that the assets will be realized in future.

N. Provisions, Contingent Liabilities and Contingent Assets

Provisions Involving 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 but are disclosed in the financial statements.


Mar 31, 2010

A. Basis of preparation of financial statements

The financial statements have been prepared under the historical cost conventions on an acrrual basis of accounting and in accordance with the generally accepted accounting principles & accounting standards to the extent applicable and the Provisions of the Companies Act, 1956.

b. Use of estimates

The preparation of the financial statements in conformity with the GAAP requires that the management make estimates and assumption that affect the reported amount of assets and liabilities and the disclosure of contigent liabilities on the date of the financial statements. Actual result could differs from those estimates.

c. Fixed Assets and Depreciation

Fixed Assets are carried at the cost of acquisition or construction less accumulated depreciation. The cost of fixed assets includes taxes, duties, freight, and other incidental expenses related to the acquisition and installation of the respective assets.

Depreciation on assets is provided using the written down value method at the rates prescribed under Schedule XIV of the Companies Act, 1956. Depreciation is calculated on pro-rata basis from / till the date of installation / disposal (sale).

d. Foreign Currency Transactions and Balances

Foreign currency transactions are recorded using the exchange rates on the date of the respective transactions.

Exchange differences arising on foreign currency transactions settled during the year are recognized in the profit and loss account.

Monetary assets and liabilities denominated in foreign currency at the balance sheet date are translated at year end rates. The resultant exchange differences are recognized in the profit and loss account, if any.

e. Investments

Investments are carried at cost. No provision for demunition in value is provided as they are long term investment.

f. Inventory of Finished Goods

Inventories are valued at lower of cost and net realizable value. Cost of inventory comprise of accuisition cost, custom duty, license and labour charges. The cost of inventory is determined at the specific cost of purchase.

g. Revenue Recognition

Revenue from sale of good is recognized when significant risk and rewards in respect of ownership of the products are transferred to the customers.

Revenue from gross sales of goods is stated exclusive of excise duty and sales tax duty and exclusive of returns and trade discounts.

Dividend income is recognized when the unconditional right to receive the income is established. Income from interest on deposits is recognised on time proportionate basis.

h. Retirement benefits

Provident Fund : The Company is not covered within purview of the Employees

Provident Fund and Miscellaneous Provisions Act, 1952 as the number of employees is within the limit prescribed under the statue.

Gratuity : Provisions for gratuity is made, however no deposit for the same has been made with appropriate authority.

Leave Encashment : No provision for leave encashment is made as the employees are not entitled to encash the accumulated leave balance lying to their credit.

i. Income Tax Expenses

Income tax comprises tax and deferred tax charge or credit.

Current Tax : The current charge for income taxes is calculated in accordance with the relevant tax regulations.

Deferred Tax : Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and total income for the period. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantially enacted by the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each balance sheet date and written down or written up to reflect the amount that is reasonably / virtually certain ( as the case may be) to be realized.

j. Proposed Dividend

No Dividend has been proposed by the board of directors.

k. Earning per share

Basic and diluted Earning per share is computed by dividing the net profit attributable to Equity Shareholders for the year with the weighted number of Equity Shares outstanding during the year.

 
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