Accounting Policies of Camson Bio Technologies Ltd. Company
Mar 31, 2018
1. SIGNIFICANT ACCOUNTING POLICIES :
1.1 Statement of compliance
The standalone financial statements have been prepared in accordance with Indian Accounting Standards ("Ind AS") notified under Section 133 of the Companies Act, 2013 ("the Act") read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules,2016.
Upto the year ended March 31, 2017, the Company prepared its financial statements in accordance with the requirements of previous generally accepted accounting principles ("Previous GAAP"), which includes Accounting Standards ("AS") notified under the Companies (Accounting Standards) Rules, 2006.
These are the Company''s first Ind AS financial statements. The date of transition to Ind AS is April 1, 2016. Refer Note 3 for the details of reconciliations from Previous GAAP and first-time adoption exemptions availed by the Company.
2.2 Basis for preparation and Presentation:
The standalone financial statements have been prepared on the historical cost basis except for certain financial instruments that are measured at fair values at the end of each reporting period, and on accrual basis.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these standalone financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of Ind AS 102, leasing transactions that are within the scope of Ind AS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in Ind AS 2 or value in use in Ind AS 36.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
i. Level 1 inputs are quoted prices (unadjusted) in active markets for similar assets or liabilities that the entity can access at the measurement date.
ii. Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
iii. Level 3 inputs are unobservable inputs for the asset or liability. Based on the nature of activities of the Company and the average time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.
The principal accounting policies are set out below.
2.3 Functional and Presentation Currency
Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which entity operates (i.e. "functional currency"). The financial statements are presented in Indian Rupee (Rs), the national currency of India, which is the functional currency of the Company.
2.4 Use of estimates
The preparation of the financial statements in conformity with Ind AS requires management to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent liabilities at the date of the financial statements and reported amounts of revenues and expenses for the periods reported.
The management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ from these estimates -estimates and underlying assumptions are reviewed on an ongoing basis. The effects of changes in accounting estimates are reflected in the financial statements in the period in which results are known and, if material, are disclosed in the financial statements.
2.5 Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable.
Sale of goods is recognised net of returns and trade discounts, when the significant risk and rewards of the ownership of goods are transferred to the buyers. Sales includes amounts recovered towards excise duty and exclude sales tax/value added tax/goods and service tax.
2.6 Other income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition.
2.7 Leasing
as a lessee
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
Operating lease
The lease rentals under such agreements are recognised in the statement of profit and loss as per the terms of the lease. Rental expense from operating leases is generally recognised on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases, such increases are recognised in the year in which such benefits accrue. as a lessor Operating lease
Lease income from operating leases where the Company is a lessor is recognised in income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases.
2.8 Foreign currencies
In preparing the financial statements of the Company, transactions in currencies other than the entity''s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in statement of profit and loss in the period in which they arise.
2.9 Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in statement of profit and loss in the period in which they are incurred.
2.10 Government grants
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with.
When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs,
When the grant relates to an asset, it is treated as deferred income and released to the statement of profit and loss over the expected useful lives of the assets concerned or other systematic basis representative of the pattern of fulfillment of obligations associated with grants received.
2.11 Employee benefits
Employee benefits include Provident fund, employee''s state insurance scheme, gratuity fund and compensated absences.
Defined contribution plans
Contributions in respect of Employees Provident Fund and Pension Fund which are defined contribution schemes, are made to a fund administered through Regional Provident Fund Commissioner and are charged as an expense based on the amount of contribution required to be made and when services are rendered by the employees.
Defined benefit plans
The Company''s Gratuity scheme (unfunded) for its employees is a defined benefit retirement benefit plan. Contributions in respect of such scheme are recognised in the statement of profit and loss. The liability as at the Balance Sheet date is provided for using the projected unit credit method, with actuarial valuations being carried out as at the end of the year.
Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained earnings and is not reclassified to statement of profit and loss.
Defined benefit costs are categorised as follows:
a. service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);
b. net interest expense or income; and
c. remeasurement
The Company presents the first two components of defined benefit costs in profit or loss in the line item ''Employee benefits expense''. Curtailment gains and losses are accounted for as past service costs. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.
Short-term employee benefits
The employees of the Company are entitled to compensated absences. The employees can carry-forward a portion of the unutilised accrued compensated absence and utilise it in future periods or receive cash compensation at retirement or termination of employment for the unutilised accrued compensated absence. The Company records an obligation for compensated absences in the period in which the employee renders the services that increase this entitlement. The Company measures the expected cost of compensated absence based on actuarial valuation made by an independent actuary as at the balance sheet date on projected unit credit method.
The cost of short-term compensated absences is accounted as under:
a. in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and
b. in case of non-accumulating compensated absences, when the absences occur.
Other long-term employee benefits
Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date less the fair value of the plan assets out of which the obligations are expected to be settled.
2.12 Earnings per share
The Company presents basic and diluted earnings per share ("EPS") data for its equity shares. Basic EPS is calculated by dividing the profit attributable to equity shareholders by weighted average number of equity shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to equity shareholders and weighted average number of equity shares outstanding for the effects of all dilutive potential equity shares.
2.13 Taxation
Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and deferred taxes are recognised in statement of profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity, respectively.
Current Tax
Current tax is determined as the amount of tax payable in respect of taxable income for the year as determined in accordance with the applicable tax rates and the provisions of the Income-tax Act, 1961.
Deferred Tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Minimum Alternate Tax (MAT) Credit
Minimum alternate tax (MAT) credit is recognised in accordance with tax laws in India as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. The Company reviews the MAT credit at each balance sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the Company will pay normal income tax during the specified period.
2.14 Cash and Cash equivalents
Cash and cash equivalents in the balance sheet include cash on hand, demand deposits with banks, other short term highly liquid investments with original maturities of three months or less, which are subject to an insignificant risk of changes in value.
2.15 Cash Flow Statement
Cash flows are reported using indirect method, whereby profit / (loss) before tax is adjusted for the effects of transaction of non - cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.
2.16 Property, plant and equipment
Property, Plant and Equipment are stated at cost less accumulated depreciation and impairment losses, if any. The cost of Property, Plant and Equipment comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, other incidental expenses and interest on borrowings attributable to acquisition of qualifying Property, Plant and Equipment up to the date the asset is ready for its intended use. Capital Work-in Progress comprises cost of Property, Plant and Equipment that are not yet ready for their intended use as at the balance sheet date.
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.
2.17 Intangible assets
Intangible assets are carried at cost less accumulated amortization and impairment losses, if any. Cost of an intangible asset comprises of purchase price and attributable expenditure on making the asset ready for its intended use.
Intangible assets are amortized over their respective individual estimated useful lives on a straight-line basis,from the date that they are available for use.
2.18 Depreciation / Amortization:
a. Tangible assets :
i) Tangible assets are stated at cost of acquisition (including incidental expenses), less accumulated depreciation.
ii) Property, plant and equipment held for sale or disposals are stated at the lower of their net book value and net realizable value.
b. Depreciation on Tangible assets
Depreciation on tangible assets is charged on Straight Line Method (SLM) as per the useful lives prescribed in Schedule II to the Companies Act, 2013 except for
i) The cost of lease hold landat Doddaballapur has been amortized over period of 1188 months
ii) Building- 360 months
iii) Computers - 36 months
iv) Office equipments - 60 months
v) Plant and machinery - 180 months
vi) Motor Vehicles - 120 months
viii) Poly house and Land development cost has been depreciated over a period of 120 months
vii) Depreciation on additions/deletions during the year has been provided for on pro-rata basis. Assets purchased/installed during the year costing less than Rs.5,000/-each are fully depreciated.
c. Intangible assets :
Intangible assets are stated at cost less accumulated amortization and impairment loss, if any.
d. Amortization of Intangible assets:
i) Intangible assets comprises of computer software which is amortized over the estimated useful life. The maximum period for such amortization is taken as 36 months based on management''s estimates of useful life.
ii) Acquired goodwill - 5 years (3 to 4 years remaining as at the balance sheet date)
iii) Intangible assets are depreciated over the license period or estimated useful life in the range of 3 to 6 years, whichever is lower.
iv) Product development costs are amortized over a period of 84 months.
The estimated useful life of the intangible assets and the amortisation period are reviewed at the end of each financial year and the amortisation period is revised to reflect
2.19 Investments:
Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as longterm investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Costs of investments include acquisition charges such as brokerage, fees and duties. Long term investments are carried individually at cost less provision for diminution other than temporary in the value of such investment.
2.20 Inventories:
a. Inventories comprises of Raw Material, Packing Materials, and Finished Goods.
b. Cost of inventories comprises of cost of purchase, cost of conversion and other cost incurred in bringing the inventories to their present location and condition.
c. The method of valuation of various categories of inventories is as follows:
i. Stock in trade, raw materials and packing materials are valued at lower of cost and net realizable value on Weighted Average Cost basis. Materials and other items held for use in the production of inventories are written down below cost if the resulting finished products are not expected to be sold at or above cost. Raw materials and packing materials are valued at FIFO basis till previous year. In the current year it has been valued at weighted average cost basis and the impact of change in valuation is not material.
ii. Finished Goods are valued at lower of cost and net realizable value. Cost includes direct materials and labour expenses and apportionment of manufacturing overheads based on normal operating capacity.
iii. Work-in-Progress are valued at cost plus production overheads.
2.21 Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker as defined under IND-AS 108.
2.22 Research and development
Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of products are also charged to the Statement of Profit and Loss unless a product''s technical feasibility has been established, in which case such expenditure is capitalized. The amount capitalized comprises expenditure that can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Property, Plant and Equipment utilized for research and development are capitalized and depreciated in accordance with the policies stated for Property, plant and equipment.
2.23 Biological Assets
Management uses inputs relating to production and market prices in determining the fair value biological assets.
2.24 Impairment of assets
a. Non financial assets - property, plant and equipment and intangible assets
The Company assesses at each reporting date whether there is an indication that an asset/cash generating unit may be impaired. If any indication exists the Company estimates the recoverable amount of such assets and if carrying amount exceeds the recoverable amount, impairment is recognised. The recoverable amount is the higher of the fair value less cost to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using an appropriate discount factor. When there is indication that previously recognised impairment loss no longer exists or may have decreased such reversal of impairment loss is recognised in the statement of profit and loss.
b. Financial assets
The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised as an impairment gain or loss in the statement of profit and loss. For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables. As a practical expedient, the Company uses a provision matrix to determine impairment loss of it''s trade receivables. The provision matrix is based on it''s historically observed default rates over the expected life of the trade receivable and is adjusted for forward looking estimates. The ECL loss allowance (or reversal) during the year is recognised in the statement of profit and loss.
2.25 Provisions, contingent liabilities and contingent assets
Provisions are recognised only when there is a present obligation as a result of past events and when a reasonable estimate of the amount of obligation can be made. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period,taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).
Contingent liabilities are disclosed for (i) possible obligation which will be confirmed only by future events not wholly within the control of the Company or (ii) present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made. Contingent assets are neither recognised nor disclosed in the financial statements.
2.26 Financial instruments
i. initial recognition
Financial assets and financial liabilities are recognised when a Company becomes a party to the contractual provisions of the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in the statement of profit and loss.
ii. Subsequent recognition Non-derivative financial instruments:
a. Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
b. Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model.
c. Financial assets at fair value through profit or loss
Financial assets are measured at fair value through profit or loss unless it is measured at amortised cost or at fair value through other comprehensive income.
d. Financial liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value through statement of profit and loss. For trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
Effective interest method
The effective interest method is a method of calculating the amortized cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at Fair Value Through Profit or Loss (FVTPL). Interest income is recognised in statement of profit and loss and is included in the "other income" line item.
Investment in subsidiaries and associates
On initial recognition, these investments are recognized at fair value plus any directly attributable transaction cost. Subsequently, they are measured at cost.
Derecognition of financial assets and financial liabilities Financial asset:
The Company de-recognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company retains substantially all the rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also recognizes a collateralised borrowing for the proceeds received.
On de-recognition of a financial asset in its entirety, the difference between the asset''s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in statement of profit and loss if such gain or loss would have otherwise been recognised in statement of profit and loss on disposal of that financial asset.
Financial liabilities
The Company derecognises financial liabilities when, and only when, the Company''s obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in the statement of profit and loss.
Foreign exchange gains and losses
For foreign currency denominated financial assets measured at amortised cost and FVTPL ,the exchange differences are recognised in statement of profit and loss.
Changes in the carrying amount of investments in equity instruments at Fair Value Through Other Comprehensive Income (FVTOCI) relating to changes in foreign currency rates are recognised in other comprehensive income. For the purposes of recognising foreign exchange gains and losses, FVTOCI debt instruments are treated as financial assets measured at amortised cost. Thus, the exchange differences on the amortised cost are recognised in statement of profit and loss and other changes in the fair value of FVTOCI financial assets are recognised in other comprehensive income.
For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the end of each reporting period, the foreign exchange gains and losses are determined based on the amortised cost of the instruments and are recognised in the statement of profit and loss.
The fair value of financial liabilities denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. For financial liabilities that are measured as at FVTPL, the foreign exchange component forms part of the fair value gains or losses and is recognised in statement of profit and loss.
(i) Borrowings include non-current and current borrowings (refer note 12)
(ii) The management assessed that fair value of cash and cash equivalents, trade receivables, other current financial assets, trade payables, borrowings and other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments, and hence these are carried at amortised cost
(iii) Investments (unquoted) are measured at fair value through initial designation in accordance with Ind-AS 109.
2.27 Fair value measurement
In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting date. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices and dealer quotes. All methods of assessing fair value result in general approximation of value, and such value may never actually be realised.
2.28 Exceptional Items
Significant gains/losses or expenses incurred arising from external events that is not expected to recur are disclosed as ''Exceptional item''.
2.29 Operating Cycle
An operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. The Company has ascertained the operating cycle as twelve months for the purpose of current or non-current classification of assets and liabilities.
2.30 Recent accounting pronouncements: Standards issued but not yet effective: -
In March 2018, The Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) Amendment Rules, 2018 notifying Ind AS 115 Revenue From Contracts with Customers and amendments to Ind AS 21 The Effects of changes in Foreign Exchange Rates, applicable for annual periods beginning on or after April 01, 2018.
Ind AS 115 - Revenue from Contracts with Customers:
Ind AS 115 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Ind AS 115 will supersede the current revenue recognition standard IND AS 18 - Revenue, Ind AS 11 - Construction Contracts when it becomes effective.
The core principle of Ind AS 115 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, based on the five step approach as defined in this standard.
Under this standard, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when ''control'' of the goods or services underlying the particular performance obligation is transferred to the customer.
The Company is evaluating the impact of this amendment on its financial statements.
2.31 Ind AS 21 - the effect of changes in Foreign exchange rates:
The amendment clarifies on the accounting of transactions that include the receipt or payment of advance consideration in a foreign currency. The appendix explains that the date of the transaction, for the purpose of determining the exchange rate, is the date of initial recognition of the non-monetary prepayment asset or deferred income liability. If there are multiple payments or receipts in advance, a date of transaction is established for each payment or receipt.
The Company is evaluating the impact of this amendment on its financial statements.
2.32 Critical accounting judgements and key sources of estimation uncertainty
In the application of the Company''s accounting policies the directors of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
a. Critical Judgements
The following are the critical judgements, apart from those involving estimations, that the directors have made in the process of applying the Company''s accounting policies and that have the most significant effect on the amounts recognized in the financial statements:
Contingences and commitments
In the normal course of business, contingent liabilities may arise from litigations and other claims against the Company. Where the potential liabilities have a low probability of crystallizing or are very difficult to quantify reliably, we treat them as contingent liabilities. Such liabilities are disclosed in the notes but are not provided for in the financial statements. Although there can be no assurance regarding the final outcome of the legal proceedings, we do not expect them to have a materially adverse impact on our financial position or profitability.
b. Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:
Estimation of net realisable value of inventories
Inventories are stated at the lower of cost and net realisable value. In estimating the net realisable value of inventories the Company makes an estimate of future selling prices and costs necessary to make the sale.
Provision for employee benefits
The Company uses actuarial assumptions to determine the obligations for employee benefits at each reporting period. These assumptions include discount rate, expected long-term rate of return on plan assets, rate of increase in compensation levels and mortality rates.
Mar 31, 2016
CORPORATE INFORMATION
Camson Bio Technologies Limned the Company'') is in the field of bio technology focused on manufacture of effective, safe and environmentally friendly natural pest management products for the agricultural markets
2SIGNFICANT ACCOUNTING POLICIES:
2.1 Basis for preparation of financial statements:
The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply wills The Accounting Standards specified under section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules. 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act") '' Companies Act, 1956 The 1956 Act"), as applicable. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.
2.3 Use of estimates:
The preparation of financial statements in conformity with the generally accepted accounting principles requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities (including contingent liability) and disclosure of contingent assets and liabilities at the date of the financial statements and the results of operations during the period under review. Although these estimates are based upon the Managements best knowledge of current events and actions, actual rhesus could differ from these estimates are recognized in the periods in the results are known.
2.3 Cash and cash equivalents (for purposes of Cash (flow statement);
cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that arc readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.
2.4 Cash flow statement.
Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing, activities of the Company arc segregated based on the available information.
2.5 Tangib1e/intangible Assets
Fixed assets at stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price, expenses incidental to the installation of the assets, cost of bringing the asset to its working condition for its intended use and attributable borrowing costs. Capital Work-in Progress comprises cost of fixed assets that are not yet ready for their intended use as at the balance sheet basis of qualifying fixed. Intangible assets are recorded at the consideration paid for their acquisition .which can be used only in connection with an item of fixed.
2.6 Depreciation / Amortization:
a, Tangible assets:
i. Tangible assets are stated at cost of acquisition (including incidental expenses), less accumulated depreciation. Assets disposals are stalled at the lower of their net book value and net realizable value.
b. Depreciation on Tangible assets
Depreciation on tangible assets is charged on Straight Line Method (SLM) in accordance the useful lives specified in Schedule II to the Companies Act. 2013 on a pro-rata basis except for following assets in respect of which is taken as estimated by the management based on the actual usage pattern of the assets
- Poly house and land development cost has been depreciated over a period of ten years.
- ii The cost of leasehold land is being amortized over 99 years
- Deprecation on addition detections during the year has been provided for on pro-rata basis assets purchased installed during the year costing less than Rs, 5,000/- each are fully depreciated.
c) Intangible assets
Intangible assets are stated at cost less accumulated amortization and impairment loss if any.
d. Amortization of Intangible assets
i. Intangible assets comprises of computer software which is amortized over the estimated use full life The Maximum period for such amortization is taken as 36 months based on management estimates of useful life.
ii. Intangible assets are depreciated over the license period or estimated use full life in the range of 3 to 6 whichever is lower.
2.7 investments:
Investments that. are readily realizable and intended to be held for not more than a year are classified as current, investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost, except for other than temporary diminution in value, if any, ate provided for.
2.8 Inventories:
a. Inventories: comprises of Packing Materials and Finished Goods.
b. Cost, of'' inventories comprises of cost of purchase, cost of conversion and other cost incurred in bringing the inventories to their present location and condition.
c. The method of valuation o (''various categories of inventories is as follow*:
(i) Slack in trade. raw materials, and packing materials are valued at and net realizable value on Weighted Average Cost basis, Materials and other items held for use in the production of inventories are written down below if the resulting finished products are not expected o be sold at. or above cost
Raw materials and packing materials are valued at RFC) basis till previous year. In the current year it has been valued at weighted average cost basis and the impact of change in valuation is not material.
(ii) Finished Goods arc valued at. lower of cost and net realizable value. Cost includes direct materials and expenses and apportionment of manufacturing overheads based on normal operating capacity.
(in-progress are valued at cost plus production overheads.
2.9 Employee Benefits:
a. Post-employment benefit, plans
Contribution to defined contributory retirement benefit schemes arc recognized as an expense when employees have rendered services entitling them to contributions. For defined benefit the cost of providing benefits is determined using the Project Unit Credit Method, with actuarial valuation being carried out at. each Balance Sheet Date. Actuarial gains and losses are recognized m full in the Statement and Loss for the period in which they occur.
Ix Short Term Employee Benefits: The amount payable on account ofâ short term employee benefits comprising largely of salaries and wages, annual bonus/ incentives etc. is valued on an un discounted basis and charged to the Statement of profit &loss for the year,
e. Other long term Employee Benefits: The employees are entitled to accumulate leave subject to certain limits for future a ailment. The liabilities for such compensated absence arc provided based on the number of days of unutilized leave at each balance sheet date on the basis of an rule-pendent actuarial valuation.
2.10 Employee share based payment''s
The Company has formulated Employee Stock Option Schemes (ESOS) in accordance with the SI./BI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. The Schemes provide for grant of ''options to employees of the company and its subsidiaries to acquire equity shares of the Company that vest in a graded manner and that are to be exercised within a specified period. In accordance with the SERI Guidelines: the excess, if any, of the closing market price on the day prior to the grant of the options under ESOS over the exercise price is amortized on a straight-line basis over the vesting period.
2.11 Revenue Recognition:
Revenue is recognized to the extern that it is probable that the economic benefits will flow Company and the be reliably measured.
a. Saia of Goods:
Revenue from sale of" goods is recognized when significant risk'' and rewards of the ownership of the goods have passed to the buyer which generally coincides with dispatch of goods to the customer and when there is no significant un regarding she consideration that will be derived from die sale of goods.
h. Interest Income;
Interest income is accounted on accrual faking into account the amount outstanding and the role applicable.
2 J 2 Research And Development:
Revenue expenditure pertaining to research is charged lo the Statement of Profit and Loss. Development costs of products arc also charged to the Statement of Profit and Loss unless a product''s technical feasibility has been established, in which case such expenditure is capitalized. The amount capitalized comprises expenditure that, can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Fixed assets utilized for research and development arc capitalized and depreciated in accordance with the policies stated for Fixed Assets.
2.13 Borrowing Costs:
''Borrowing costs include interest, amortization of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest east. Costs in connection with the borrowing of funds to the extent not directly related So the acquisition of qualifying assets are charged to die Statement of Profit and Loss over the tenure of the loan. Borrowing costs, allocated to and utilized for qualifying assets, pertaining to the period from commencement of activities relating to construction / development of the qualifying asset up to the date of capitalization of such asset are added to the cost of the assets. Capitalization of borrowing costs is suspended and charged to the Statement of Profit and Loss during extended periods when active development activity on the qualifying assets is interrupted.
2.4 Taxation:
a. Current âtax:
Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the applicable tax rates and the provisions of the Income Tax Act, 1961 and other applicable tax laws.
b. Minimum Alternative Tax (MAT):
Minimum Alternate Tax (MAT) paid in accordance with the fax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognized as an asset in the Balance Sheet when it is highly probable that future economic benefit associated with if will flow to the Company. .
e, Deferred Tax:
''Deferred lax is recognized on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured use; She tax rates and the tax laws enacted or substantively enacted as at the reporting dale, Deferred tax liabilities are recognized for all timing differences. Deferred tax assets arc recognized for timing (Terenceâs of items other than unabsorbed depreciation and cam-forward losses only to the extern that reasonable certainly exi.sls that sufficient future taxable income will be available against which these can be realized. However, inhere are unabsorbed depreciation and carry forward of losses and items relating to capital losses, deferred tax assets arc recognized only if there is virtual certainly supported by convincing evidence that there will be sufficient future taxable income available to realize the assets. Deterred tax assets and liabilities arc offset if such items relate to taxes on income levied by the same governing tax laws and the Company has n legally enforceable right for such set off. Deferred tax assets arc reviewed at cash balance sheet date for and deferred tax relating lo items directly recognized m reserves is creolized ii) reserves and not in the Statement of Profit and Loss.
2.15 impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment of the carrying amount of the Company''s assets. If any indication exists, the recoverable amount of such assets is estimated. An impairment loss is recognized wherever the carrying amount of the assets exceeds its recoverable amount. The recoverable amount is greater of the net selling price or value in use. Where it is not possible to estimate the recoverable amount of'' an individual asset, the company estimates the recoverable amount of the cash generating unit to which the asset belongs.
2.16 Foreign Currency Transactions:
Transactions in foreign currencies entered into by the Company are accounted at the exchange rates prevailing on the date of the transaction or at rates that closely approximate-the rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currency are restated at the exchange rate prevalent on the Balance Sheet date and gain/ loss on such restatement is charged lo die Statement and Loss.
2,1.7 Leases:
Assets acquired on lease where a significant portion of the risks and rewards of the ownership are retained by the lesser are classified as operating lease. Lease rentals arc charged off to the Statement of Profit and Loss on straight line basis on the lease term as incurred.
2.18 Earnings per Share:
Basic earnings per share is computed by dividing the profit / (loss) after lax (including die post-lax elect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.
2.19 Provisions and contingent liabilities:
A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation m respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate, required to settle die obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Conned liabilities are disclosed in the Notes. Contingent assets are not recognized in the financial statements.
2.2(1 Operating Cycle:
Ali assets and liabilities have been classified as current and non-current as per the company''s normal operating cycle and other criteria set out in the schedule II of the Companies Act 2013. Based on the nature of service;'' operations. The company has ascertained itâs operating cycle as 1 months for the purpose of current and non-curred classification of assist and liabilities.
27. Additional Disclosures
Dues us Micro and Small Enterprises have been determined to the exie.nl such parties have been identified on the basis of information collected by the Management. This has been relied upon by die auditors.
27,3 Disclosure as per Clause 32 of the Listing. Agreements with the Stock Exchanges
(i) Loans and. advances in the nature of loans given to subsidiaries, firms / companies in winch directors are interested:
28, Disclosure under Accounting Standards: -
28, Employee Benefits
a) Defined contribution plans:
The Company makes Provident Fund contribution and Employee Sciatic Insurance Scheme entry which arc defined contribution plans, for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund she benefits. I he Company recognized Rs. 4,028,057 F Y . Rs. 4.239,096 for provident fund contributions and Rs. 42.076 (F.Y. Rs. 63,686) for Employee Stale insurance Scheme contribution in the Statement of profit and loss. The contributions payable to these plan, by the Company are at riles specified in the rules of the respective scheme.
b) The fined benefit plans.
The Company makes provision for Employeesâ Gratuity Sachem for eligible employees. The scheme provides tor lump sum payment to eligible employees at retirement. death while m employment, or on termination of employment, an amount equivalent to 15 days salary payable for each completed year of service or pair thereof in excess of six months. Eligibility occurs upon completion of five years of service.
The present value of the defined bonnet obligation and current service east were measured using the Projected Unit. Credit Method, with actuarial valuations being carried out at the balance sheet date.
a) Employees are entitled to accumulation of leave which can be enchased at the lime of retirement or termination, The leave encashment benefit scheme is a defined benefit plan and is not funded, lie née, there are no plan assets attributable to the obligation, ''The Leave encashment liability under defined benefit plan as on 31,03,2016 is Rs,1,854,379 (P.Y.Rs,704.427)
28.2 Employee Stock Options Plan
In the extraordinary general meeting held on Feb 12, 2015 the shareholders approved the issue of'' 1.499,9% options under the Scheme ESOR
The ESOP allows the issue of options to employees of the Company Bach option comprises one under equity share.
As per the Scheme, the Remuneration / Compensation Committee grants the options to the employees deemed eligible. The exercise price teach option shall, be Rs, 109- One Hundred Nine Only) per option as defined in the Scheme. The options granted vest over a period of 3ycars from the date of the grant in proportions specified in the Scheme. Options may be exercised within 365 days of vesting.
The difference between the fair price of the share tm crying the options granted on the date of grant of option and the exercise price of the option (being the intrinsic value of the option) representing Stock compensation expense is expensed over the vesting period.
Mar 31, 2015
1.1 Basis for preparation of Financial Statements:
The financial statements are prepared under the historic cost
convention, on accrual basis of accounting and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 (as amended) and the relevant provisions of the
Companies Act, 2013. The accounting policies adopted by the company are
consistent with those of the previous year.
All assets and liabilities have been classified as current and
non-current as per the company's normal operating cycle and other
criteria set out in the schedule III of the Companies Act 2013. Based
on the nature of service/ operations. The company has ascertained it's
operating cycle as 12 months for the purpose of current and non-current
classification of assets and liabilities.
1.2 Use of estimates:
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Managements best knowledge of current events and
actions, actual results could differ from these estimates.
1.3 Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in Progress comprises cost of fixed
assets that are not yet ready for their intended use as at the balance
sheet date. Intangible assets are recorded at the consideration paid
for their acquisition.
1.4 Depreciation / Amortization:
a. Tangible assets :
i. Tangible assets are stated at cost of acquisition (including
incidental expenses), less accumulated depreciation.
ii Assets held for sale or disposals are stated at the lower of their
net book value and net realizable value.
b. Depreciation on Tangible assets
Depreciation on tangible assets is charged on Straight Line Method
(SLM) in accordance with the useful lives specified in Schedule II to
the Companies Act, 2013 on a pro-rata basis except for following assets
in respect of which useful life is taken as estimated by the management
based on the actual usage pattern of the assets
i. Poly house and Land development cost has been depreciated over a
period of ten years
ii. The cost of leasehold land at Doddaballapur plant is being
amortized over 99 years
iii. Depreciation on additions/deletions during the year has been
provided for on pro-rata basis. Assets purchased/installed during the
year costing less than Rs.5,000/- each are fully depreciated.
c. Intangible assets :
Intangible assets are stated at cost less accumulated amortization and
impairment loss, if any.
d. Amortization of Intangible assets:
i. Intangible assets comprises of computer software which is amortized
over the estimated useful life. The maximum period for such
amortization is taken as 36 months based on management's estimates of
useful life.
ii. Intangible assets are depreciated over the license period or
estimated useful life in the range of 3 to 6 years, whichever is lower
iii. Product development costs are amortized over a period of 84
months.
The Company has revised depreciation rates on fixed assets effective
April 1, 2014 in accordance with requirement of schedule II of
Companies Act 2013 ("the Act"). The remaining useful life has been
revised by adopting standard useful life as per the Companies Act,
2013. Consequent upon such change the depreciation amounting to
Rs.90.78 lakhs (net of deferred tax of Rs. 8.91 lakhs) has been
adjusted against reserves in respect of assets which have already
completed their useful lives before April 2014 and for other assets
depreciation has been charged based on their remaining useful life. Had
the company continued with the previously assessed useful lives, the
charge for depreciation would have been lower by Rs.93.77 lakhs and Rs.
353 Lakhs for the quarter and year ended 31st March 2015 respectively.
1.5 Investments:
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost, except for other than temporary diminution in value, if any, are
provided for.
1.6 Inventories:
a. Inventories comprises of Raw Material, Stores, Spares and
Consumables, Packing Materials, Finished Goods and Foundation Seeds.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other cost incurred in bringing the inventories to their
present location and condition.
c. The method of valuation of various categories of inventories is as
follows:
(i) Stock in trade, raw materials, stores, spares, consumables, and
packing materials are valued at lower of cost and net realizable value
on FIFO basis. Materials and other items held for use in the production
of inventories are written down below cost if the resulting finished
products are not expected to be sold at or above cost.
(ii) Finished Goods and Work-in-Progress are valued at lower of cost
and net realizable value. Cost includes direct materials and labour
expenses and apportionment of manufacturing overheads based on normal
operating capacity determined using the retail method. Cost also
includes a portion of the research expenses which in the opinion of the
management attribute to the development of these seeds.
(iii)Foundation seeds which are meant for production are valued at
cost. (Refer Note No. 35.1)
1.7 Employee Benefits:
a. Post-employment benefit plans
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
Statement of Profit and Loss for the period in which they occur.
b. Short Term Employee Benefits:
The amount payable on account of short term employee benefits
comprising largely of salaries and wages, annual bonus/ incentives etc.
is valued on an undiscounted basis and charged to the Statement of
profit &loss for the year.
c. Other long term Employee Benefits: The employees are entitled to
accumulate leave subject to certain limits for future availment. The
liabilities for such compensated absence are provided based on the
number of days of unutilized leave at each balance sheet date on the
basis of an independent actuarial valuation.
1.8 Revenue Recognition:
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods:
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty regarding the consideration that
will be derived from the sale of goods.
b. Interest Income:
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
1.9 Research And Development:
Revenue expenditure is charged to the Statement of Profit and Loss.
Fixed Assets utilized for research activities are capitalized and
depreciated in accordance with the policies stated for tangible fixed
assets and in tangible fixed assets.
1.10 Borrowing Costs:
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to the Statement of Profit and Loss in the year in which they are
incurred.
1.11 Taxation:
a. Current Tax:
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT):
In case the company is liable to pay income tax u/s 115JB of income tax
Act,1961 ( MAT), the amount of tax paid in excess of normal income tax
is recognized as an asset (MAT Credit Entitlement) only if there is
convincing evidence for realization of such asset during the specified
period. M AT credit entitlement is reviewed at each balance sheet date.
c. Deferred Tax:
The deferred tax asset and deferred tax liability is calculated by
applying tax rate that have been enacted or substantively enacted by
the Balance Sheet date. Deferred tax assets arising mainly on account
of brought forward losses and unabsorbed depreciation under tax laws
are recognized only if there is a virtual certainty of its realization
supported by convincing evidence. Deferred tax asset on account of
other timing differences are recognized only to the extent there is a
reasonable certainty of its realization. At each balance sheet date the
carrying amount of deferred tax assets are reviewed.
1.12 Impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date
if there is any indication of impairment of the carrying amount of the
Company's assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the company estimates the recoverable amount of the
cash generating unit to which the asset belongs.
1.13 Foreign Currency Transactions:
Transactions in foreign currencies entered into by the Company are
accounted at the exchange rates prevailing on the date of the
transaction or at rates that closely approximate the rate at the date
of the transaction. Monetary assets and liabilities denominated in
foreign currency are restated at the exchange rate prevalent on the
Balance Sheet date and gain/ loss on such restatement is charged to the
Statement of Profit and Loss.
1.14 Leases:
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the lessor are classified as
operating lease. Lease rentals are charged off to the Statement of
Profit and Loss on straight line basis on the lease term as incurred.
1.15 Earnings per Share:
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period
adjusted for the effects of all dilutive potential equity shares is
considered.
1.16 Provisions and contingent liabilities:
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to present
value and are determined as best estimates required settling the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of:
a. A present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation;
b. A present obligation when no reliable estimate is possible; and
c. A possible obligation arising from past events where the
probability of outflow of resources is remote.
Contingent Assets are not recognized in the financial statements.
Mar 31, 2014
1 Basis of Accounting:
The financial statements are prepared under the historic cost
convention, on accrual basis of accounting and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 (as amended) and the relevant provisions of the
Companies Act, 1956.
The accounting policies adopted by the company are consistent with
those of the previous year.
2 Use of estimates:
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Managements best knowledge of current events and
actions, actual results could differ from these estimates.
3 Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in Progress comprises cost of fixed
assets that are not yet ready for their intended use as at the balance
sheet date. Intangible assets are recorded at the consideration paid
for their acquisition.The Product development cost incurred on
development of new products arc recognized as fixed asset (Intangible
work in progress) when feasibility has been established, the company
has committed technical, financial & other resources to complete the
development and it is probable that the asset will generate probable
future benefits. On completion of development such costs are disclosed
as intangible assets.
4 Depreciation/Amortization:
The Company provides depreciation on fixed assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV of the
Companies Act, 1956. Poly house has been depreciated over a period of
ten years. Intangible assets are depreciated over the license period or
estimated useful life in the range of 3 to 6 years, whichever is lower.
Depreciation on additions/deletions during the year has been provided
for on pro-rata basis. Assets purchased/installed during the year
costing less than Rs.5,000/- each are fully depreciated.
Amortization on Leasehold improvements has been done in proportion to
the period of lease. Land development cost is being amortized over 10
years.
Product development costs are amortized over a period of 84 months.
5 Investments:
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost, except for other than temporary diminution in value, if any, are
provided for.
6 Inventories:
a. Inventories comprises of Raw Material, Stores, Spares and
Consumables, Packing Materials, Finished Goods and Foundation Seeds.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other cost incurred in bringing the inventories to their
present location and condition.
c. The method of valuation of various categories of inventories is as
follows:
(i) Stock in trade, raw materials, stores, spares, consumables, and
packing materials are valued at lower of cost and net realizable value
on FIFO basis. Materials and other items held for use in the production
of inventories are written down below cost if the resulting finished
products are not expected to be sold at or above cost.
(ii) Finished Goods and Work-in-Progress are valued at lower of cost
and net realizable value. Cost includes direct materials and labour
expenses and apportion of manufacturing overheads based on normal
operating capacity determined using the retail method. Cost also
includes a portion of the research expenses which in the opinion of the
management attribute to the development of these seeds.
(iii) Foundation seeds which are meant for production arc valued at
cost. (Refer Note No. 26.1)
7 Employee Benefits:
a. Post-employment benefit plans
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
Statement of Profit and Loss for the period in which they occur.
b, Short Term Employee Benefits: The amount payable on account of short
term employee benefits comprising largely of salaries and wages, annual
bonus/ incentives etc. is valued on an undiscounted basis and charged
to the Statement of profit &loss for the year.
c. Other long term Employee Benefits: The employees are entitled to
accumulate leave subject to certain limits for future availment. The
liabilities for such compensated absence are provided based on the
number of days of unutilized leave at each balance sheet date on the
basis of an independent actuarial valuation.
8 Revenue Recognition:
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods:
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty regarding the consideration that
will be derived from the sale of goods.
b. Interest Income:
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
9 Research And Development:
Revenue expenditure is charged to Statement of Profit and Loss in the
year in which it is incurred.
10 Borrowing Costs:
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to the Statement of Profit and Loss in the year in which they are
incurred.
11 Taxation:
a. Current Tax:
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT):
In case the company is liable to pay income tax u/s 115JB of income tax
Act, 1961 ( MAT), the amount of tax paid in excess of normal income tax
is recognized as an asset (MAT Credit Entitlement) only if there is
convincing evidence for realization of such asset during the specified
period. MAT credit entitlement is reviewed at each balance sheet date.
c. Deferred Tax:
The deferred tax asset and deferred tax liability is calculated by
applying tax rate that have been enacted or substantively enacted by
the Balance Sheet date. Deferred tax assets arising mainly on account
of brought forward losses and unabsorbed depreciation under tax laws
are recognized only if there is a virtual certainty of its realization
supported by convincing evidence. Deferred tax asset on account of
other timing differences are recognized only to the extent there is a
reasonable certainty of its realization. At each balance sheet date the
carrying amount of deferred tax assets are reviewed.
12 Impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date
if there is any indication of impairment of the carrying amount of the
Company''s assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the company estimates the recoverable amount of the
cash generating unit to which the asset belongs,
13 Foreign Currency Transactions:
Transactions in foreign currencies entered into by the Company are
accounted at the exchange rates prevailing on the date of the
transaction or at rates that closely approximate the rate at the date
of the transaction. Monetary assets and liabilities denominated in
foreign currency are restated at the exchange rate prevalent on the
Balance Sheet date and gain/ loss on such restatement is charged to the
Statement of Profit and Loss.
14 Operating Leases:
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the lessor are classified as
operating lease. Lease rentals are charged off to the Statement of
Profit and Loss on straight line basis on the lease term as incurred.
15 Earnings per Share:
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity'' shareholders and the
weighted average number of shares outstanding during the period
adjusted for the effects of all dilutive potential equity shares is
considered.
16 Accounting for Provisions, Contingent Liabilities and Contingent
Assets:
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions arc not discounted to present
value and are determined as best estimates required settling the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of:
a. A present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation;
b. A present obligation when no reliable estimate is possible; and
c. A possible obligation arising from past events where the
probability of outflow of resources is remote.
Contingent Assets are not recognized in the financial statements.
Mar 31, 2013
1.1 Basis of Accounting:
The financial statements are prepared under the historic cost
conversion, on the basis of a going concern and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 and relevant provisions of the Companies Act,
1956. The Company follows mercantile system of accounting and
recognizes Income and Expenditure on accrual basis. The accounting
policies have been diligently applied by the Company and are consistent
with those used in the previous year.
1.2 Use of estimates:
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Managements best knowledge of current events and
actions, actual results could differ from these estimates.
1.3 Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in Progress comprises cost of fixed
assets that are not yet ready for their intended use as at the balance
sheet date. Intangible assets are recorded at the consideration paid
for their acquisition.
1.4 Depreciation / Amortization:
The Company provides depreciation on fixed assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV of the
Companies Act, 1956 except in the case of Poly House which has been
depreciated over the period of ten years. Depreciation on
additions/deletions during the year has been provided for on pro-rata
basis. Assets purchased/installed during the year costing less than
Rs.5,000/- each are fully depreciated.
Amortization on Leasehold improvements has been done in proportion to
the period of lease.
1.5 Investments:
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost.
1.6 Inventories:
a. Inventories comprises of Raw Material, Stores, Spares and
Consumables, Packing Materials, Work-in Process including foundation
seeds and Finished Goods.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other cost incurred in bringing the inventories to their
present location and condition.
c. The method of valuation of various categories of inventories is as
follows:
(i) Raw Materials, stores, spares, consumables, and packing materials
are valued at lower of cost and net realizable value on FIFO basis.
However, materials and other items held for use in the production of
inventories are not written down below cost if the resulting finished
products are expected to be sold at or above cost.
(ii) Work-in-Progress and Finished Goods are valued at lower of cost
and net realizable value. Cost includes direct materials and labour
expenses and aproportion of manufacturing overheads based on normal
operating capacity determined on standard cost basis. Cost also
includes a portion of the research expenses which in the opinion of the
management attribute to the development of these seeds.
1.7 Employee Benefits:
a. Post-employment benefit plans
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
profit and loss account for the period in which they occur. Past
service cost is recognized immediately to the extent that the benefits
are already vested, and otherwise it is amortized on straight-line
basis over the average period until the benefits become eligible for
being vested.
b. Short Term Employee Benefits: The amount payable on account of
short term employee benefits comprising largely of salaries and wages,
annual bonus is valued on an undiscounted basis and charged to the
profit &loss account for the year.
1.8 Revenue Recognition:
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods:
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty exists regarding the amount of the
consideration that will be derived from the sale of goods.
b. Interest Income:
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
1.9 Research And Development:
Research and Development expenditure relating to capital items is
debited to fixed assets and depreciated at the applicable rates.
Revenue expenditure is charged to Profit and Loss account in the year
in which it is incurred.
1.10 Borrowing Costs:
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to Profit and Loss Account in the year in which they are incurred.
1.11 Taxation:
a. Current Tax:
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT):
In case the company is liable to pay income tax u/s 115JB of income tax
Act,1961 ( MAT), the amount of tax paid in excess of normal income tax
is recognized as an asset (MAT Credit Entitlement) only if there is
convincing evidence for realization of such asset during the specified
period. MAT credit entitlement is reviewed at each balance sheet date.
c. Deferred Tax:
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date. Deferred tax assets arising mainly
on account of brought forward losses and unabsorbed depreciation under
tax laws are recognized only if there is a virtual certainty of its
realization supported by convincing evidence. Deferred tax asset on
account of other timing differences are recognized only to the extent
there is a reasonable certainty of its realization. At each balance
sheet date the carrying amount of deferred tax assets are reviewed to
reassure realization.
1.12 Impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date
if there is any indication of impairment of the carrying amount of the
Company''s assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the company estimates the recoverable amount of the
cash generating unit to which the asset belongs.
1.13 Foreign Currency Transactions:
Foreign currency transactions are dealt with in accordance with the
Accounting Standard 11 "The Effects of Changes in Foreign Exchange
Rates".
1.14 Operating Leases:
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the lessor are classified as
operating lease. Lease rentals are charged off to the Profit & Loss
Account as incurred.
1.15 Earnings per Share:
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
1.16 Accounting for Provisions, Contingent Liabilities and Contingent
Assets:
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to present
value and are determined as best estimates required settling the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of:
a. A present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation;
b. A present obligation when no reliable estimate is possible; and
c. A possible obligation arising from past events where the
probability of outflow of resources is remote. Contingent Assets are
not recognized in the financial statements.
Mar 31, 2012
1.1 Basis of Accounting:
The financial statements are prepared under the historic cost
conversion, on the basis of a going concern and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 and relevant provisions of the Companies Act,
1956. The Company follows mercantile system of accounting and
recognizes Income and Expenditure on accrual basis. The accounting
policies have been diligently applied by the Company and are consistent
with those used in the previous year.
1.2 Use of Estimates:
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Managements best knowledge of current events and
actions, actual results could differ from these estimates.
1.3 Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in Progress comprises cost of fixed
assets that are not yet ready for their intended use as at the balance
sheet date. Intangible assets are recorded at the consideration paid
for their acquisition.
1.4 Depreciation / Amortization:
The Company provides depreciation on fixed assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV of the
Companies Act, 1956. Depreciation on additions/deletions during the
year has been provided for on pro-rata basis. Assets
purchased/installed during the year costing less than Rs.5, 000/- each
are fully depreciated. Amortization on Leasehold improvements has been
done in proportion to the period of lease.
1.5 Investments:
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost.
1.6 Inventories:
a. Inventories comprises of Raw Material, Stores, Spares and
Consumables, Packing Materials, Work-in Process including foundation
seeds and Finished Goods.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other cost incurred in bringing the inventories to their
present location and condition.
c. The method of valuation of various categories of inventories is as
follows:
(i) Raw Materials, stores, spares, consumables, and packing materials
are valued at lower of cost and net realizable value on FIFO basis.
However, materials and other items held for use in the production of
inventories are not written down below cost if the finished products in
which they will be incorporated are expected to be sold at or above
cost.
(ii) Work-in-Progress and Finished Goods are valued at lower of cost
and net realizable value. Cost includes direct materials and labour
expenses and appropriation of manufacturing overheads based on normal
operating capacity determined on standard cost basis. Cost also
includes a portion of the research expenses which in the opinion of the
management attribute to the development of these seeds.
1.7 Employee Benefits:
a. Post-employment benefit plans
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
profit and loss account for the period in which they occur. Past
service cost is recognized immediately to the extent that the benefits
are already vested, and otherwise it is amortized on straight-line
basis over the average period until the benefits become eligible for
being vested.
b. Short Term Employee Benefits: The amount payable on account of
short term employee benefits comprising largely of salaries and wages,
annual bonus is valued on an undiscounted basis and charged to the
profit &loss account for the year.
1.8 Revenue Recognition:
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods:
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty exists regarding the amount of the
consideration that will be derived from the sale of goods.
b. Interest Income:
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
c. Dividend Income:
Dividend from Investment is recognized when the right to receive
payment is established.
1.9 Research and Development:
Research and Development expenditure relating to capital items is
debited to fixed assets and depreciated at the applicable rates.
Revenue expenditure is charged to Profit and Loss account in the year
in which it is incurred.
1.10 Borrowing Costs:
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to Profit and Loss Account in the year in which they are incurred.
1.11 Taxation:
a. Current Tax:
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT):
In case the company is liable to pay income tax u/s 115JB of income tax
Act,1961 ( MAT), the amount of tax paid in excess of normal income tax
is recognized as an asset (MAT Credit Entitlement) only if there is
convincing evidence for realization of such asset during the specified
period. MAT credit entitlement is reviewed at each balance sheet date.
c. Deferred Tax:
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date. Deferred tax assets arising mainly
on account of brought forward losses and unabsorbed depreciation under
tax laws are recognized only if there is a virtual certainty of its
realization supported by convincing evidence. Deferred tax asset on
account of other timing differences are recognized only to the extent
there is a reasonable certainty of its realization. At each balance
sheet date the carrying amount of deferred tax assets are reviewed to
reassure realization.
1.12 Impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date
if there is any indication of impairment of the carrying amount of the
Company's assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the company estimates the recoverable amount of the
cash generating unit to which the asset belongs.
1.13 Foreign Currency Transactions:
Foreign currency transactions are dealt with in accordance with the
Accounting Standard 11 "The Effects of Changes in Foreign Exchange
Rates", notified by the Companies (Accounting Standards) Rules, 2006.
1.14 Operating Leases:
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the lessor are classified as
operating lease. Lease rentals are charged off to the Profit & Loss
Account as incurred.
1.15 Earnings per Share:
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
1.16 Accounting for Provisions, Contingent Liabilities and Contingent
Assets:
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to present
value and are determined as best estimates required settling the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of:
a. A present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation;
b. A present obligation when no reliable estimate is possible; and
c. A possible obligation arising from past events where the
probability of outflow of resources is remote.
Contingent Assets are not recognized in the financial statements.
Mar 31, 2011
1) Basis of Accounting :
The financial statements are prepared under the historic cost
conversion, on the basis of a going concern and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 and relevant provisions of the Companies Act,
1956. The Company follows mercantile system of accounting and
recognizes Income and Expenditure on accrual basis. The accounting
policies have been diligently applied by the Company and are consistent
with those used in the previous year.
2) Use of estimates :
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Management's best knowledge of current events and
actions, actual results could differ from these estimates.
3) Fixed Assets :
Fixed Assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in-Progress comprises of advances paid to
acquire fixed assets and the cost of fixed assets that are not yet
ready for their intended use as at the Balance Sheet date. Intangible
assets are recorded at the consideration paid for their acquisition.
4) Depreciation / Amortization :
1. The Company provides depreciation on Fixed Assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV of the
Companies Act, 1956. Depreciation on additions/deletions during the
year has been provided for on pro-rata basis. Assets
purchased/installed during the year costing less than Rs.5,000/ - each
are fully depreciated.
2. Amortization on Leasehold improvements has been done in proportion
to the period of lease.
5) Investments :
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost.
6) Inventories :
a. Inventories comprises of Raw Materials, Stores, Spares and
Consumables, Packing Materials, Work-in-Progress including Foundation
Seeds and Finished Goods.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other costs incurred in bringing the inventories to
their present location and condition.
c. The method of valuation of various categories of inventories is as
follows :
(i) Raw Materials, stores, spares, consumables, and packing materials
are valued at lower of cost and net realizable value on FIFO basis.
However, materials and other items held for use in the production of
inventories are not written down below cost if the finished products in
which they will be incorporated are expected to be sold at or above
cost.
(ii) Work-in-Progress and Finished Goods are valued at lower of cost
and net realizable value. Cost includes direct materials and labour and
a proportion of manufacturing overheads based on normal operating
capacity. Cost of seeds is determined on standard cost basis.
7) Employee Benefits :
a. Post-employment benefit plans :
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
Profit and Loss Account for the period in which they occur. Past
service cost is recognized immediately to the extent that the benefits
are already vested, and otherwise it is amortized on straight-line
basis over the average period until the benefits become eligible for
being vested.
b. Short Term Employee Benefits :
The amount payable on account of short term employee benefits
comprising largely of salaries and wages, annual bonus is valued on an
undiscounted basis and charged to the Profit and Loss Account for the
year.
8) Revenue Recognition :
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods :
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty existing regarding the amount of
the consideration that will be derived from the sale of goods.
b. Interest Income :
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
c. Dividend Income :
Dividend from Investment is recognized when the right to receive
payment is established.
9) Research And Development :
Research and Development expenditure relating to capital items is
debited to fixed assets and depreciated at the applicable rates.
Revenue expenditure is charged to Profit and Loss Account in the year
in which it is incurred.
10) Borrowing Costs :
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to Profit and Loss Account in the year in which they are incurred.
11) Taxation :
a. Current Tax :
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT) :
In case the Company is liable to pay income tax u/s 115JB of Income Tax
Act,1961 (i.e. MAT), the amount of tax paid in excess of normal income
tax is recognized as an asset (MAT Credit Entitlement), only if there
is convincing evidence for realization of such asset during the
specified period. MAT credit entitlement is reviewed at each Balance
Sheet date.
c. Deferred Tax :
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date. Deferred tax assets arising mainly
on account of brought forward losses and unabsorbed depreciation under
tax laws are recognized only if there is a virtual certainty of its
realization supported by convincing evidence. Deferred tax asset on
account of other timing differences are recognized only to the extent
there is a reasonable certainty of its realization. At each Balance
Sheet date the carrying amount of deferred tax assets are reviewed to
reassure realization.
12) Impairment of Assets :
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment of the carrying amount of the
Company's assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the Company estimates the recoverable amount of the
cash generating unit to which the asset belongs.
13) Foreign Currency Transactions :
Foreign currency transactions are dealt with in accordance with the
Accounting Standard 11 "The Effects of Changes in Foreign Exchange
Rates", notified by the Companies (Accounting Standards) Rules, 2006.
14) Operating Leases :
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the Lessor are classified as
operating lease. Lease rentals are charged off to the Profit & Loss
Account as incurred.
15) Earnings per Share :
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
16) Accounting for Provisions, Contingent Liabilities and Contingent
Assets :
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to present
value and are determined as best estimates required settling the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of :
a. a present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation ;
b. a present obligation when no reliable estimate is possible; and
c. a possible obligation arising from past events where the
probability of outflow of resources is remote. Contingent Assets are
not recognized in the financial statements.
Mar 31, 2010
1) Basis of Accounting:
The financial statements are prepared under the historic cost
conversion, on the basis of a going concern and as per applicable
Notified Accounting Standards laid down in Companies (Accounting
Standards) Rules, 2006 and relevant provisions of the Companies Act,
1956. The Company follows mercantile system of accounting and
recognizes Income and Expenditure on accrual basis. The accounting
policies have been diligently applied by the Company and are consistent
with those used in the previous year.
2) Use of estimates:
The preparation of financial statements in conformity with the
generally accepted accounting principles requires the Management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the results of
operations during the period under review. Although these estimates are
based upon the Managements best knowledge of current events and
actions, actual results could differ from these estimates.
3) Fixed Assets:
Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price, expenses
incidental to the installation of the assets, cost of bringing the
asset to its working condition for its intended use and attributable
borrowing costs. Capital Work-in Progress comprises of advances paid to
acquire fixed assets and the cost of fixed assets that are not yet
ready for their intended use as at the balance sheet date. Intangible
assets are recorded at the consideration paid for their acquisition.
4) Depreciation / Amortization:
The Company provides depreciation on fixed assets on Straight Line
Method at the rates and in the manner prescribed in Schedule XIV of the
Companies Act, 1956 except Foundation Seeds which is amortized over a
period of ten years. Depreciation on additions/deletions during the
year has been provided for on pro-rata basis. Assets
purchased/installed during the year costing less than Rs.5,000/- each
are fully depreciated.
5) Investments:
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long term investments are carried at
cost.
6) Inventories:
a. Inventories comprises of Raw Materials, Stores, Spares and
Consumables, Packing Materials, Work-in Progress and Finished Goods.
b. Cost of inventories comprises of cost of purchase, cost of
conversion and other costs incurred in bringing the inventories to
their present location and condition.
c. The method of valuation of various categories of inventories is as
follows:
i) Raw Materials, stores, spares, consumables, and packing materials
are valued at lower of cost and net realizable value on FIFO basis.
However, materials and other items held for use in the production of
inventories are not written down below cost if the finished products in
which they will be incorporated are expected to be sold at or above
cost.
ii) Work-in-Progress and Finished Goods are valued at lower of cost and
net realizable value. Cost includes direct materials and labour and a
proportion of manufacturing overheads based on normal operating
capacity. Cost of seeds is determined on standard cost basis.
7) Employee Benefits:
a. Post-employment benefit plans
Contribution to defined contributory retirement benefit schemes are
recognized as an expense when employees have rendered services
entitling them to contributions. For defined benefit schemes, the cost
of providing benefits is determined using the Project Unit Credit
Method, with actuarial valuation being carried out at each Balance
Sheet Date. Actuarial gains and losses are recognized in full in the
profit and loss account for the period in which they occur. Past
service cost is recognized immediately to the extent that the benefits
are already vested, and otherwise it is amortized on straight-line
basis over the average period until the benefits become eligible for
being vested.
b. Short Term Employee Benefits: The amount payable on account of short
term employee benefits comprising largely of salaries and wages, annual
bonus is valued on an undiscounted basis and charged to the Profit &
Loss Account for the year.
8) Revenue Recognition:
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
a. Sale of Goods:
Revenue from sale of goods is recognized when significant risk and
rewards of the ownership of the goods have passed to the buyer which
generally coincides with dispatch of goods to the customer and when
there is no significant uncertainty existing regarding the amount of
the consideration that will be derived from the sale of goods.
b. Interest Income:
Interest Income is recognized on a time proportionate basis taking into
account the amount outstanding and the rate applicable.
c. Dividend Income:
Dividend from Investment is recognized when the right to receive
payment is established.
9) Research And Development:
Research and Development expenditure relating to Capital items is
debited to fixed assets and depreciated at the applicable rates.
Revenue expenditure is charged to Profit and Loss Account in the year
in which it is incurred.
10) Borrowing Costs:
Borrowing costs that are directly attributable to the acquisition and
construction of qualifying assets are capitalized as part of the cost
of asset up to the date such asset is ready for its intended use. A
qualifying asset is one that necessarily takes substantial period of
time to get ready for intended use. Other borrowing costs are charged
to Profit and Loss Account in the year in which they are incurred.
11)Taxation:
a. Current Tax:
Provision for current taxation has been made in accordance with the
Income Tax laws applicable to the assessment year.
b. Minimum Alternative Tax (MAT):
In case the Company is liable to pay Income Tax u/s 115JB of Income Tax
Act,1961 (i.e. MAT), the amount of tax paid in excess of normal income
tax is recognized as an asset (MAT Credit Entitlement) only if there is
convincing evidence for realization of such asset during the specified
period. MAT credit entitlement is reviewed at each balance sheet date.
c. Deferred Tax:
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date. Deferred tax assets arising mainly
on account of brought forward losses and unabsorbed depreciation under
tax laws are recognized only if there is a virtual
certainty of its realization supported by convincing evidence. Deferred
tax asset on account of other timing differences are recognized only to
the extent there is a reasonable certainty of its realization. At each
balance sheet date the carrying amount of deferred tax assets are
reviewed to reassure realization.
12)Impairment of Assets:
The carrying amounts of assets are reviewed at each balance sheet date
if there is any indication of impairment of the carrying amount of the
Companys assets. If any indication exists, the recoverable amount of
such assets is estimated. An impairment loss is recognized wherever the
carrying amount of the assets exceeds its recoverable amount. The
recoverable amount is greater of the net selling price or value in use.
Where it is not possible to estimate the recoverable amount of an
individual asset, the Company estimates the recoverable amount of the
cash generating unit to which the asset belongs.
13)Foreign Currency Transactions:
Foreign currency transactions are dealt with in accordance with the
Accounting Standard 11 ÃThe Effects of Changes in Foreign Exchange
RatesÃ, notified by the Companies (Accounting Standards) Rules, 2006.
14)Operating Leases:
Assets acquired on lease where a significant portion of the risks and
rewards of the ownership are retained by the Lessor are classified as
operating lease. Lease rentals are charged off to the Profit & Loss
Account as incurred.
15)Earnings per Share:
Basic earnings per share are calculated by dividing the net profit for
the period attributable to equity shareholders (after deducting
preference dividends and attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
16)Accounting for Provisions, Contingent Liabilities and Contingent
Assets:
A provision is recognized when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to present
value and are determined as best estimates required to settle the
obligation at the Balance Sheet date.
Contingent Liabilities are disclosed by way of notes to accounts in
case of:
a. A present obligation arising from past events, when it is not
probable that an outflow of resources will be required to settle that
obligation;
b. A present obligation when no reliable estimate is possible; and
c. A possible obligation arising from past events where the
probability of outflow of resources is remote. Contingent Assets are
not recognized in the financial statements.
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