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Accounting Policies of Yash Papers Ltd. Company

Mar 31, 2016

1.1 Basis of Preparation of Financial Statements

The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with Generally Accepted Accounting Principles in India including the Accounting Standards as prescribed by the Companies Act, 2013.

1.2 Use of Estimates

The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities, contingent liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognized in the year in which the same are acknowledged/ materialized.

1.3 Fixed Assets

Fixed Assets are stated at cost (of acquisition/ construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs up to the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalized. (Also refer Note 1.12 & 1.18 on Borrowing Costs and CENVAT).

1.4 Intangible Assets

Intangible assets are recognized only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost (including expenses attributable to such asset) and are carried at cost less accumulated amortization and impairment losses, if any. [Also refer Note 1.6 (iii)].

1.5 Capital work in Progress

Capital work in progress comprises cost of fixed assets not yet commissioned, incidental preoperative expenses and borrowing costs.

1.6 Depreciation / Amortization

i. Depreciation on fixed assets is provided on ''Straight Line Method'' on the basis of useful life specified in Schedule II to the Companies Act, 2013. Fixed assets costing below ''5,000/are fully depreciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortized over the period of lease.

iii. Computer Software being intangible asset is amortized over a period of 5 years on "Straight Line Method".

1.7 Impairment of Assets

The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the "recoverable amount" of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the "carrying amount", the carrying amount is reduced to its recoverable amount. If at the subsequent Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount.

1.8 Investments

Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

1.9 Inventories

i. Inventories other than Scrap and Import entitlements/license are valued at lower of cost or net realizable value. For this purpose cost is determined as under:

a. Raw materials, Stores and spares: Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

ii. Scraps and Import entitlements/license (DEPB) are valued at estimated realizable value.

1.10 Revenue Recognition

i. Sales are recognized on dispatch of goods to customers. Sales are net of discount/ rebate and sales tax but include Excise Duty. However the claims are recognized on settlement.

ii. Export Incentives are recognized when certainty of receipt is established.

iii. All other incomes are accounted for on accrual basis.

1.11 Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of contract. Gains or loss on these assets and liabilities are recognized in the Statement of Profit and Loss except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

1.12 Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalized as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as an expense in the year in which they are incurred.

1.13 Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature are adjusted with the respective expenditure/ treated as income as the case may be.

1.14 Employee Benefits

a) Company''s contributions to Provident Fund and Family Pension Fund are charged to Statement of Profit and Loss.

b) Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c) Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d) Other Termination benefits are recognized as an expense as and when incurred.

1.15 Research and Development Expenditure

Expenditure of revenue nature is charged to Statement of Profit and Loss and that of capital nature is capitalized as fixed assets.

1.16 Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognized in the accounts.

1.17 Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the AS-22 on Taxes on Income.

1.18 CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

1.19 Cash flow statement has been prepared as per the "Indirect Method" specified in AS-3 on Cash Flow Statement.

1.20 Prior period items, if material, are disclosed separately.


Mar 31, 2015

1.1 Basis of Preparation of Financial Statements

The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with Generally Accepted Accounting Principles in India, the Accounting Standards as prescribed by the Companies Act, 2013.

1.2 Use of Estimates

The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognised in the year in which the same are acknowledged/ materialized.

1.3 Fixed Assets

Fixed Assets are stated at cost (of acquisition/ construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs upto the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalised. (Also refer Note 1.12 & 1.18 on Borrowing Costs and CENVAT)

1.4 Intangible Assets

Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and impairment losses, if any. [Also refer Note 1.6 (iii)]

1.5 Capital work in Progress

Capital work in progress comprises cost of fixed assets not yet commissioned, incidental pre-operative expenses and borrowing costs.

1.6 Depreciation / Amortisation

i. Depreciation on fixed assets is provided on ''Straight Line Method'' on the basis of useful life specified in Schedule II to the Companies Act, 2013. Fixed assets costing below Rs.5,000/- are fully depreciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortised over the period of lease.

iii. Computer Software being intangible asset is amortised over a period of 5 years on "Straight Line Method".

1.7 Impairment of Assets

The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the "recoverable amount" of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the "carrying amount", the carrying amount is reduced to its recoverable amount. If at the subsequent Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount.

1.8 Investments

Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

1.9 Inventories

i. Inventories other than Scrap and Import entitlements/licence are valued at lower of cost or net realisable value. For this purpose cost is determined as under:

a. Raw materials and paddy husk : Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

e. Stores (excepting paddy husk), spares and loose tools: FIFO method

ii. Scraps and Import entitlements/licence (DEPB) are valued at estimated realisable value.

1.10 Revenue Recognition

i. Sales are recognised on despatch of goods to customers. Sales are net of discount/ rebate and sales tax but include Excise Duty. However the claims are recognized on settlement.

ii. Export Incentives (DEPB etc.) are recognised when certainty of receipt is established.

iii. All other incomes are accounted for on accrual basis.

1.11 Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognised over the life of contract. Gains or loss on these assets and liabilities are recognised in the Statement of Profit and Loss except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

1.12 Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalised as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognised as an expense in the year in which they are incurred.

1.13 Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature are adjusted with the respective expenditure/ treated as income as the case may be.

1.14 Employee Benefits

a) Company''s contributions to Provident Fund and Family Pension Fund are charged to Statement of Profit and Loss.

b) Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c) Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d) Termination benefits are recognized as an expense as and when incurred.

1.15 Research and Development Expenditure

Expenditure of revenue nature is charged to

Statement of Profit and Loss and that of capital

nature is capitalized as fixed assets.

1.16 Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognised in the accounts.

1.17 Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the AS 22 on Taxes on Income.

1.18 CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

1.19 Prior period items, if material, are shown separately.


Mar 31, 2014

1.1 Basis of Preparation of Financial Statements The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with applicable accounting principles in India, the Accounting Standards as prescribed by the Companies (Accounting Standards) Rules, 2006 (AS) in India and the relevant provisions of the Companies Act, 1956 (the Act).

1.2 Use of Estimates

The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognised in the year in which the same are acknowledged/ materialized.

1.3 Fixed Assets

Fixed Assets are stated at cost (of acquisition/ construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs upto the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalised. (Also refer Note 1.12 & 1.18 on Borrowing Costs and CENVAT)

1.4 Intangible Assets

Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and impairment losses, if any. [Also refer Note 1.6 (iii)]

1.5 Capital work in Progress

Capital work in progress comprises cost of fixed assets not yet commissioned, incidental pre- operative expenses and borrowing costs.

1.6 Depreciation / Amortisation

i. Depreciation on fixed assets is provided on ''Straight Line Method'' at the rates specified under Schedule XIV to the Companies Act, 1956. Fixed assets costing below Rs.5,000/- are fully depreciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortised over the period of lease.

iii. Computer Software being intangible asset is amortised over a period of 5 years on "Straight Line Method".

1.7 Impairment of Assets

The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the "recoverable amount" of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the "carrying amount", the carrying amount is reduced to its recoverable amount. If at the subsequent Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount.

1.8 Investments

Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

1.9 Inventories

i. Inventories other than Scrap and Import entitlements/licence are valued at lower of cost or net realisable value. For this purpose cost is determined as under:

a. Raw materials and paddy husk : Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

e. Stores (excepting paddy husk), spares and loose tools: FIFO method

ii. Scraps and Import entitlements/licence (DEPB) are valued at estimated realisable value.

1.10 Revenue Recognition

i. Sales are recognised on despatch of goods to customers. Sales are net of discount/ rebate and sales tax but include Excise Duty.

ii. Export Incentives (DEPB etc.) are recognised when certainty of receipt is established.

iii. All other incomes are accounted for on accrual basis.

1.11 Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognised over the life of contract. Gains or loss on these assets and liabilities are recognised in the Statement of Profit and Loss except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

1.12 Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalised as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognised as an expense in the year in which they are incurred.

1.13 Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature are adjusted with the respective expenditure/ treated as income as the case may be.

1.14 Employee Benefits

a) Company''s contributions to Provident Fund and Family Pension Fund are charged to Statement of Profit and Loss.

b) Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c) Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d) Termination benefits are recognized as an expense as and when incurred.

1.15 Research and Development Expenditure Expenditure of revenue nature is charged to Statement of Profit and Loss and that of capital nature is capitalized as fixed assets.

1.16 Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognised in the accounts.

1.17 Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the AS 22 on Taxes on Income.

1.18 CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

1.19 Prior period items, if material, are shown separately.

2.2 Term/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts.

The distribution will be in proportion to the number of equity shares held by the shareholders.

2.3 Bonus Shares/Shares issued for consideration other than cash/Buy Back of shares during preceding five years: NIL

2.4 Shares held by holding/ultimate holding company and/or their subsidiary/associate: NIL

4.1 The CDR-EG in its meeting held on June 01, 2012 has approved CDR Package (cut off date being July 01, 2011) of the company. Oriental Bank of Commerce (OBC) has been appointed as Monitoring Institution (MI). Final Letter of Approval (LOA) has been issued by the CDR cell to all the lenders with a copy to the company on June 08, 2012. Individual Sanction Letter in line with LOA has been received from all the banks. Master Restructuring Agreement (MRA) has been executed on October 05, 2012 and Joint consortium documents have been executed on November 20, 2012. CDR has been implemented successfully.

4.2 All the existing term loans, fresh term loans and FITL are secured by pari-passu first charge on all the fixed assets of the Company and second pari-passu charge on the current assets of the company.

Pledge of 98.39% equity share of the Company held by the promoters.

Corporate Guarantee of Yash Agro Products Ltd. & Satori Global Ltd., the associates.

Personal Guarantee of Promoter Directors of the Company, Mr Ved Krishna and Mrs. Manjula Jhunjhunwala.

4.3 These Loans are repayable over a period of 8 years in structured thirty two quarterly installment commencing from September 2013 to June 2021.


Mar 31, 2013

1.1 Basis of Preparation of Financial Statements

The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with applicable accounting principles in India, the Accounting Standards as prescribed by the Companies (Accounting Standards) Rules, 2006 (AS) in India and the relevant provisions of the Companies Act, 1956 (the Act).

1.2 Use of Estimates

The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognised in the year in which the same are acknowledged/ materialized.

1.3 Fixed Assets

Fixed Assets are stated at cost (of acquisition/construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs upto the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalised. (Also refer Note 1.12 & 1.18 on Bor- rowing Costs and CENVAT)

1.4 Intangible Assets

Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and impairment losses, if any. [Also refer Note 1.6 (iii)]

1.5 Capital work in Progress

Capital work in progress comprises cost of fixed assets not yet commissioned, incidental pre-operative expenses and borrowing costs.

1.6 Depreciation / Amortisation

i. Depreciation on fixed assets is provided on ''Straight Line Method'' at the rates specified under Schedule XIV to the Companies Act, 1956. Fixed assets costing below Rs.5,000/- are fully de- preciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortised over the period of lease.

iii. Computer Software being intangible asset is amortised over a period of 5 years on "Straight Line Method”.

1.7 Impairment of Assets

The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the "recoverable amount” of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the "carrying amount”, the carrying amount is reduced to its recoverable amount. If at the subsequent Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reas- sessed and the asset is reflected at recoverable amount.

1.8 Investments

Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

1.9 Inventories

i. Inventories other than Scrap and Import entitlements/licence are valued at lower of cost or net realisable value. For this purpose cost is determined as under:

a. Raw materials and paddy husk : Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

e. Stores (excepting paddy husk), spares and loose tools: FIFO method

ii. Scraps and Import entitlements/licence (DEPB) are valued at estimated realisable value.

1.10 Revenue Recognition

i. Sales are recognised on despatch of goods to customers. Sales are net of discount/ rebate and sales tax but include Excise Duty.

ii. Export Incentives (DEPB etc.) are recognised when certainty of receipt is established. iii. All other incomes are accounted for on accrual basis.

1.11 Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognised over the life of contract. Gains or loss on these assets and liabilities are recognised in the Statement of Profit and Loss except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

1.12 Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalised as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognised as an expense in the year in which they are incurred.

1.13 Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature are adjusted with the respective expenditure/ treated as income as the case may be.

1.14 Employee Benefits

a) Company''s contributions to Provident Fund and Family Pension Fund are charged to Statement of Profit and Loss.

b) Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c) Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d) Termination benefits are recognized as an expense as and when incurred.

1.15 Research and Development Expenditure

Expenditure of revenue nature is charged to Statement of Profit and Loss and that of capital nature is capitalized as fixed assets.

1.16 Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognised in the accounts.

1.17 Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the AS 22 on Taxes on Income.

1.18 CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

1.19 Prior period items, if material, are shown separately.


Mar 31, 2012

1.1 Basis of Preparation of Financial Statements

The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with applicable accounting principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

1.2 Use of Estimates

The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognised in the year in which the same are acknowledged/ materialised.

1.3 Fixed Assets

Fixed Assets are stated at cost (of acquisition/construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs upto the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalised. (Also refer Note 1.12 & 1.18 on Borrowing Costs and CENVAT)

1.4 Intangible Assets

Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and impairment losses, if any. [Also refer Note 1.6 (iii)]

1.5 Capital work in Progress

Capital work in progress comprises cost of fixed assets not yet commissioned, incidental pre-operative expenses and borrowing costs.

1.6 Depreciation / Amortisation

i. Depreciation on fixed assets is provided on 'Straight Line Method' at the rates specified under Schedule XIV to the Companies Act, 1956. Fixed assets costing below Rs.5,000/- are fully depreciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortised over the period of lease.

iii. Computer Software being intangible asset is amortised over a period of 5 years on "Straight Line Method".

1.7 Impairment of Assets

The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the "recoverable amount" of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the "carrying amount", the carrying amount is reduced to its recoverable amount. If at the subsequent Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount.

1.8 Investments

Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

1.9 Inventories

i. Inventories other than Scrap and Import entitlements/licence are valued at lower of cost or net realisable value. For this purpose cost is determined as under:

a. Raw materials and paddy husk : Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

e. Stores (excepting paddy husk), spares and loose tools: FIFO method

ii. Scraps and Import entitlements/licence (DEPB) are valued at estimated realisable value.

1.10 Revenue Recognition

i. Sales are recognised on despatch of goods to customers. Sales are net of discount/ rebate and sales tax but include Excise Duty.

ii. Export Incentives (DEPB etc.) are recognised when certainty of receipt is established.

iii. All other incomes are accounted for on accrual basis.

1.11 Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognised over the life of contract. Gains or loss on these assets and liabilities are recognised in the Profit and Loss Account except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

1.12 Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalised as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognised as an expense in the year in which they are incurred.

1.13 Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature are adjusted with the respective expenditure/ treated as income as the case may be.

1.14 Employee Benefits

a) Company's contributions to Provident Fund and Family Pension Fund are charged to Profit and Loss Account.

b) Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c) Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d) Termination benefits are recognised as an expense as and when incurred.

1.15 Research and Development Expenditure

Expenditure of revenue nature is charged to Profit & Loss Account and that of capital nature is capitalised as fixed assets.

1.16 Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognised in the accounts.

1.17 Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the Accounting Standard 22, Accounting for Taxes on Income (AS-22) issued by the Institute of Chartered Accountants of India.

1.18 CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

1.19 Prior period items, if material, are shown separately.


Mar 31, 2010

1. Basis of Preparation of Financial Statements The accounts are prepared on accrual basis under the historical cost convention and to comply in all material aspects with applicable accounting principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates The preparation of Financial Statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the balance sheet date and the revenues and expenses during the year. Difference, if any, between the actual and the estimate is recognised in the year in which the same are acknowledged/ materialised.

3. Fixed Assets Fixed Assets are stated at cost (of acquisition/construction, as the case may be), net of CENVAT and Subsidy, less accumulated depreciation and accumulated impairment losses, if any. All costs including borrowing costs up to the date of commissioning of related assets and all direct and indirect expenses attributable to the assets are capitalised. (Also refer Para A-12 & A-17 on borrowing costs and CENVAT)

4. Intangible Assets Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and impairment losses, if any. [Also refer Para 6 (iii)]

5. Capital work in Progress Capital work in progress comprises cost of fixed assets not yet commissioned, incidental pre-operative expenses, borrowing costs and advances for capital expenditure.

6. Depreciation / Amortisation i. Depreciation on fixed assets is provided on ‘Straight Line Method’ at the rates specified under Schedule XIV to the Companies Act, 1956. Fixed assets costing below Rs. 5,000/- are fully depreciated in the year of addition. Depreciation is provided on pro-rata basis with reference to the date of addition / deletion in respect of addition to/ deletion from fixed assets.

ii. Leasehold Land is amortised over the period of lease.

iii. Computer Software being intangible asset is amortised over a period of 5 years on “Straight Line Method”.

7. Impairment of Assets The Company assesses at each Balance Sheet date, whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the “recoverable amount” of asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than the “carrying amount”, the carrying amount is reduced to its recoverable amount. If at the Balance Sheet date there is an indication that a previously assessed/impaired loss no longer exists, the recoverable amount is reassessed and the asset is reflected at recoverable amount.

8. Investments Long Term Investments are stated at cost. A provision for diminution is made if in the opinion of the management, the diminution is other than temporary.

9. Inventories i. Inventories other than Scrap and Import entitlements/licence are valued at lower of cost or net realisable value. For this purpose cost is determined as under:

a. Raw materials and paddy husk : Weighted Average Cost

b. Work in process: Direct Cost Method (estimated basis)

c. Pulp: Direct Cost Method (estimated basis)

d. Finished goods: Direct cost method

e. Stores (excepting paddy husk), spares and loose tools: FIFO method

ii. Scraps and Import entitlements/licence (DEPB) are valued at estimated realisable value.

10. Revenue Recognition

i. Sales are recognised on despatch of goods to customers. Sales are net of discount / rebate and sales tax but include Excise Duty.

ii. Exports Incentives (DEPB etc.) are accrued in the year in which the goods are exported and accounted to the extent considered receivable. iii. All other incomes are accounted for on accrual basis.

11. Foreign Currency Transactions

Outstanding foreign currency assets and liabilities, other than those covered by Forward Exchange Contract, are translated at the exchange rate prevailing as on Balance Sheet date. Foreign Exchange asset / liability covered by Forward Exchange Contract are translated at the rate prevailing at the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognised over the life of contract. Gains or loss on these assets and liabilities are recognised in the Profit and Loss Account except in case of long term liabilities, where they relates to acquisition of fixed assets, in which case they are adjusted to the carrying cost of respective assets.

12. Borrowing Costs

Borrowing costs that are attributable to the acquisition/construction of qualifying assets are capitalised as part of cost of such assets. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognised as an expense in the year in which they are incurred.

13. Government Grants

Government Grant related to fixed assets are adjusted with the Gross Block / Cost of fixed assets and Grants of revenue nature is are adjusted with the respective expenditure/ treated as income as the case may be.

14. Employee Benefits

a. Companys contributions to Provident Fund and Family Pension Fund are charged to Profit and Loss Account.

b. Provision for Gratuity is determined on the basis of actuarial valuation at the end of the year and is debited to the profit and loss account each year.

c. Provision for leave encashment (treated as short term in nature) is done on the basis of leaves accrued as at the end of the year.

d. Termination benefits are recognised as an expense as and when incurred.

15. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered probable. Contingent liabilities are disclosed by way of notes on accounts in respect of obligations where, based on the evidences available, their existence at the Balance Sheet date is considered not probable. Contingent assets are not recognised in the accounts.

16. Taxes on Income

Provision for tax on income for the year (i.e. Current Tax) is made after considering the various deductions/relief admissible under the Income Tax Act, 1961. Provision for tax effect of timing difference (i.e. Deferred Tax) is made in accordance with the provisions of the Accounting Standard 22, Accounting for Taxes on Income (AS-22) issued by the Institute of Chartered Accountants of India.

17. CENVAT credit availed in respect of capital goods is adjusted from cost of assets and in respect of other items is adjusted from related expenses.

18. Prior period items, if material, are shown separately.

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