Accounting Policies of Evexia Lifecare Ltd. Company

Mar 31, 2018

33 FINANCIAL RISK MANAGEMENT

The company''s activities expose it to market risk, liquidity risk and credit risk.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk.

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors has established the Risk Management Committee, which is responsible for developing and monitoring the Company''s risk management policies. The committee reports to the board of directors on its activities.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed periodically to reflect changes in market conditions and the Company''s activities. The Company, through its training, standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The audit committee oversees how management monitors compliance with the company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.

(A) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers and investment securities. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

(i) Trade receivables

The Company measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. However, based on historical data, there were no significant bad debts written off nor provision for doubtful debts had been created. Further there is no Trade Receivables outstanding for more than 6 months at reporting date. Hence, allowances for doubtful debt has not been created.

(ii) Cash and cash equivalents

As at the year end, the Company held cash and cash equivalents of 17.38 Lacs (31.03.2017 74.34 Lakhs, 01.04.2016 157.30 '' Lakhs). The cash and cash equivalents are held with bank and financial institution counterparties with good credit rating.

(iii) Loans and advances

In the case of loans to employees, the same is managed by establishing limits. (Which in turn based on the employees salaries and number of years of service put in by the concern employee)

(iv) Other Financials Assets

Others Financial Assets are considered to be of good quality and there is no significant increase in credit risk.

(v) REVALUATION OF FIXED ASSETS

The company has revalued it''s land, building, plant & machinery during the year after taking valuation report from external independent value. The figures shown in books of accounts are revalued figures and increase in carrying amount arising from upward revaluation in land amount has been transfer to revaluation reserve under the head reserves and surplus.

(B) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

Maturities of financial liabilities

The tables herewith analyse the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities for:

The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

(C) Market risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables and long term debt. We are exposed to market risk primarily related to foreign exchange rate risk. Thus, our exposure to market risk is a function of revenue generating and operating activities in foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency revenues and costs. The Company uses derivative to manage market risk. Generally, the Company seeks to apply hedge accounting to manage volatility in profit or loss.

Currency risk

The Company is exposed to currency risk on account of its operations in other countries. The functional currency of the Company is Indian Rupee. The exchange rate between the Indian rupee and foreign currencies has changed substantially in recent periods and may continue to fluctuate substantially in the future. Consequently, the Company uses both derivative instruments, i.e, foreign exchange forward contracts to mitigate the risk of changes in foreign currency exchange rates in respect of its highly probable forecasted transactions and recognized assets and liabilities.

The company enters into foreign currency forward contracts which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency required or available at the settlement date of certain payables/receivables.

CAPITAL MANAGEMENT

The Company''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders.

The objective of company''s capital management are to:

- Safeguard their ability to continue as going concern so that they can continue to provide benefits to their shareholders

- Maximize the wealth of the shareholder.

- Maintain optimal capital structure to reduce the cost of capital

The board of directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position.

The Company monitors capital using a ratio of ''adjusted net debt'' to ''total equity''. For this purpose, adjusted net debt is defined as total liabilities, comprising interest-bearing loans and borrowings, less cash and cash equivalents, other bank bank balances and current investments.

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Mar 31, 2016

Notes Forming Part of the Financial Statements

1. General Information

Kavit Industries Limited (Formerly known as Atreya Petrochem Limited) is Public Limited Company incorporated in India under the provisions of the Companies Act, 1956. The Company’s strength lies in the various business Segments like manufacturing of Oil Products, Manufacturing & Trading of Garments of men and woman wears with Brand Name "RAW ", Company has also expanded another Line of Business in Power Sector with Name " KAVIT GREEN ENERGY PRIVATE LIMITED” ( 100% SPV OF KIL). The same has been set up as a Solar Energy Power Project in Karnataka which is awarded by KARNATAKA RENEWABLE ENERGY DEVELOPMENT LIMITED (Govt of Karnataka Undertaking.

2. Basis of preparation and presentation of financial statements

(a) Accounting Convention

The Accounts of the Company are prepared under the Historical Cost Convention on the Accrual Basis of Accounting in accordance with the Generally Accepted Accounting Principles in India (“GAAP”) and in compliance with the mandatory Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and with the relevant provisions of the Companies Act, 1956. The Financial Statements are presented in Indian Rupees rounded off to the nearest rupees.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting periods. Examples of such estimate include future obligations under employee benefit plans, income taxes, useful lives of fixed assets and intangible assets, impairment of assets, provision for doubtful debts etc. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could vary from these estimates. Appropriate changes in estimates are made as the management becomes aware of the changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognized in the period in which such results are known/ materialized. Effect of material changes is disclosed in the notes to the financial statements.

The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisitions of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-non-current classification of assets and liabilities.

(b) Tangible Assets, Depreciation

i. Tangible assets are stated at Cost less Accumulated Depreciation, Impairment loss, if any, ascertained as per the Accounting Standard 28 (Impairment of Assets). Cost comprises the Purchase Price and any such costs attributable for the purpose of bringing the asset to its working condition for its intended use.

ii. Tangible Assets under construction, Advances paid towards acquisition of Tangible Assets and Cost of Assets not ready for use as at the year end, are disclosed as Capital Work-In Progress.

iii. In respect of Tangible Assets depreciation is provided on Straight line basis applying the rates specified in schedule XIV of Companies Act 1956 except Computer.

iv. Tangible Assets below Rs.10000 are fully depreciated in the year of acquisition.

(c) Investment

Investments of long term-nature are stated at cost, less adjustment for any diminution, other than temporary, in the value thereof. Current Investments are stated at lower of cost or market value.

(d) Inventory

Finished and Semi-Finished Products produced and purchased by the company are carried at Cost and net realizable value, whichever is lower.

Work in Progress is carried at lower of cost and net realizable value.

Raw Material is carried at lower of cost and net realizable value.

Stores and Spares parts are carried at cost. Necessary provision is made and expensed in case of identified obsolete and non moving items.

Cost of Inventory is generally ascertained on the ‘Weighted average'' basis. Work in progress, Finished and semi finished products are valued at on full absorption cost basis.

Cost Comprises expenditure incurred in the normal course of business in bringing such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activity. Packing Material is considered as finished goods. Consumable stores are written off in the year of Purchase.

(e) Employee Benefits

Provision for Gratuity, Leave Encashment and bonus has not been made as none of the employee have completed the minimum qualified period of services.

(f) Impairment of Assets

At each balance sheet date, the management reviews the carrying amounts of each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exits, the recoverable amount of the assets is estimated in order to determine the extent of impairment loss. Recoverable amount is higher of an asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the assets and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the assets. Cash flows used to determine value in use are derived from annual budgets and strategic plans of the cash generating units.

(g) Revenue Recognition

Sale are recognized on when substantial risks and rewards of ownership in the goods are transferred to the buyer i.e. delivery as per terms of sale.

(h) Other Income

Interest Income and income from Investments are accounted on accrual basis.

Dividend Income is recognized when the right to receive dividend is established.

(i) Foreign Currency Transactions

Transactions in Foreign Currency and Non-Monetary Assets are accounted for at the Exchange Rate prevailing on the date of the transaction. All monetary items denominated in Foreign Currency are converted at the Year-End Exchange Rate. The Exchange Differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise.

(j) Taxes on Income

Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred Tax is recognized for all the timing differences, subject to the consideration of prudence in respect of deferred tax assets.

Deferred Tax Assets are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

(k) Cash & Cash Equivalent

Cash & Cash Equivalent for the purpose of cash flow statement comprises of cash at bank and in hand and short term investments/ bank deposits with an original maturity of three months or less.

(l) Provisions

A Provision is recognized when company has a present obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

(m) Trade Receivables:

In respect of Receivable for Sundry Debtors (Incl. Receivable on Sale of Investments) of Rs.166.92 Lacs and Other Trade receivable, the amount of Bad & Doubtful Debts are is not ascertainable on account of non- receipt of confirmation from the party.

(n) In respect of loan and advances, the amount of bad and doubtful debts is not ascertainable on account of non- receipt of confirmation from the party.

(o) In the opinion of the Directors, Current Assets, Loans & Advances have values at which they are stated in the Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and all known liabilities is adequate.

(p) Sundry Creditors, Unsecured loans, other liabilities, loans and advances, sundry debtors, and other current assets are subject to confirmation.

(q) Micro Small & Medium Enterprise: The Company is in the process of compiling the relevant information. Dues to Micro and small enterprises have been determined to the extent such parties have been identified on the basis of information collected by the management. This has been relied upon by us.

(r) Claims, Demands and Contingencies :

Details of disputed and/ or contingent Liabilities are as follows:

(s) In the opinion of the Management, the Provident Fund and ESI act are not applicable, hence no provision have been made for the same.

(t) Earning & Expenditure in Foreign Currency : Nil (P.Y. - Nil)

(u) Directors Remuneration: 7,20,000 (P.Y. - Nil)

(v) Auditors Remuneration : 67,416/- (P.Y.60,000)

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Mar 31, 2015

1. General Information

Kavit Industries Limited (Formeriyknown asAtreya Petrochem Limited) is Public Limited Company incorporated in India under the provisions of the Companies Act, 1956. The Company's strength lies in the various business Segments like manufacturing of Oil Products, Manufacturing & Trading of Garments of men and woman wears with Brand Name "RAW ", Company has also expanded another Line of Business in Power Sector with Name " KAVIT GREEN ENERGY PRIVATE LIMITED" (100% SPV OF KIL). The same has been set up as a Solar Energy Power Project in Karnataka which is awarded by KARNATAKA RENEWABLE ENERGY DEVELOPMENT LIMITED (Govt of Karnataka Undertaking.

2. Basis of preparation and presentation of financial statements (a) Accounting Convention The Accounts of the Company are prepared under the Historical Cost Convention on the Accrual Basis of Accounting in accordance with the Generally Accepted Accounting Principles in India ("GAAP") and in compliance with the mandatory Accounting Standards notified under the Companies (Accounting Standards) Rules. 2006. as amended, and with the relevant provisions of the Companies Act, 1956. The Financial Statements are presented in Indian Rupees rounded off to the nearest rupees.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting periods. Examples of such estimate include future obligations under employee benefit plans, income taxes, useful lives of fixed assets and intangible assets, impairment of assets, provision for doubtful debts etc. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could vary from these estimates..Appropriate changes in estimates are made as the management becomes aware of the changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognized in the period in which such results arc known/ materialized. Effect of material changes is disclosed in the notes to the financial statements.

The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisitions of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-non-current classification of assets and liabilities.

(b) Tangible Assets, Depreciation

i. Tangible assets are stated at Cost less Accumulated Depreciation, Impairment loss, if any, ascertained as per the Accounting Standard 28 (Impairment of Assets). Cost comprises the Purchase Price and any such costs attributable for the purpose of bringing the asset to its working condition for its intended use.

ii. Tangible Assets under construction, Advances paid towards acquisition of Tangible Assets and Cost of Assets not ready for use as at the year end, are disclosed as Capital Work-In Progress.

iii. In respect of Tangible Assets depreciation is provided on Straight line basis applying the rates specified in schedule XIV of Companies Act 1956 except Computer.

iv. Tangible Assets below Rs. 10000 are fully depreciated in the year of acquisition.

(c) Investment

Investments of long term-nature are stated at cost, less adjustment for any diminution, other than temporary, in the value thereof. Current Investments are stated at lower of cost or market value.

(d) Inventory

Finished and Semi-Finished Products produced and purchased by the company are carried at Cost and net realisable value, whichever is lower.

Work in Progress is carried at lower of cost and net realisable value.

Raw Material is carried at lower of cost and net realisable value.

Stores and Spares parts are carried at cost. Necessary provision is made and expensed in case of identified obsolete and non moving items.

Cost of Inventory is generally ascertained on the Weighted average' basis. Work in progress. Finished and semi finished products are valued at on full absorption cost basis.

Cost Comprises expenditure incurred in the normal course of business in bringing such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activity. Packing Material is considered as finished goods. Consumable stores are written off in the year of Purchase.

(e) Employee Benefits

Provision for Gratuity, Leave Encashment and bonus has not been made as none of the employee have completed the minimum qualified period of services.

(f) Impairment of Assets

At each balance sheet date, Che management reviews the carrying amounts of each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exits, the recoverable amount of the assets is estimated in order to determine the extent of impairment loss. Recoverable amount is higher of an asset's net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the assets and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to [he assets. Cash Hows used to determine value in use are derived from annual budgets and strategic plans of the cash generating units.

(g) Revenue Recognition

Sale are recognized on when substantial risks and rewards of ownership in the goods are transferred to the buyer i.e. delivery as per terms of sale.

(h) Other Income

interest income and income from Investments are accounted on accrual basis. Dividend Income is recognized when the right to receive dividend is established.

(i) Foreign Currency Transactions

Transactions in Foreign Currency and Non--Monetary Assets are accounted for at the Exchange Rate prevailing on the date of the transaction. All monetary items denominated in Foreign Currency are converted at the Year-End Exchange Rate. The Exchange Differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise,

(j) Taxes on Income

Current Income Tax is measured at the amount expected to be paid to the ta.x authorities in accordance with the Income Tax Act, 1961.

Deferred Tax is recognized tor all the timing differences, subject to the consideration of prudence in respect of deferred tax assets.

Deferred Tax Assets are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

(k) Cash & Cash Equivalent

Cash & Cash Equivalent for the purpose of cash flow statement comprises of cash at bank and in hand and short term investments/ bank deposits with an original maturity ofthree months or less.

(l) Provisions

A Provision is recognized when company has a present obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at: each reporting date and adjusted to reflect the current best estimates.

(m) Trade Receivables:

In respect of Receivable for Sundry Debtors (Incl. Receivable on Sale of Investments) of Rs. 166.92 Lacs and Other Trade receivable, the amount of Bad & Doubtful Debts are is not ascertainable on account of non- receipt of confirmation from the party.

(n) In respect of loan and advances, the amount of bad and doubtful debts is not ascertainable on account of non- receipt of confirmation from the party.

(o) In the opinion of the Directors, Current Assets, Loans & Advances have values at which they are stated in the Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and all known liabilities is adequate.

(p) Sundry Creditors, Unsecured loans, other liabilities, loans and advances, sundry debtors, and other current assets are subject to confirmation.

(q) Micro Small & Medium Enterprise: The Company is in the process of compiling the relevant information. Dues to Micro and small enterprises have been determined to the extent such parties have been identified on the basis of information collected by the management. This has been relied upon by us.

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Mar 31, 2014

(a) Accounting Convention

The Accounts of the Company are prepared under the Historical Cost Convention on the Accrual Basis of Accounting in accordance with the Generally Accepted Accounting Principles in India ("GAAP") and in compliance with the mandatory Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and with the relevant provisions of the Companies Act, 1956. The Financial Statements are presented in Indian Rupees rounded off to the nearest rupees.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting periods. Examples of such estimate include future obligations under employee benefit plans, income taxes, useful lives of fixed assets and intangible assets, impairment of assets, provision for doubtful debts etc. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could vary from these estimates. Appropriate changes in estimates are made as the management becomes aware of the changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognized in the period in which such results are known/ materialized. Effect of material changes is disclosed in the notes to the financial statements.

The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisitions of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-non-current classification of assets and liabilities.

(b) Tangible Assets, Depreciation

i. Tangible assets are stated at Cost less Accumulated Depreciation, Impairment loss, if any, ascertained as per the Accounting Standard 28 (Impairment of Assets). Cost comprises the Purchase Price and any such costs attributable for the purpose of bringing the asset to its working condition for its intended use.

ii. Tangible Assets under construction, Advances paid towards acquisition of Tangible Assets and Cost of Assets not ready for use as at the year end, are disclosed as Capital Work-In Progress.

iii. In respect of Tangible Assets depreciation is provided on Straight line basis applying the rates specified in schedule XIV of Companies Act 1956 except Computer.

iv. Tangible Assets below Rs.10000 are fully depreciated in the year of acquisition.

(c) Investment

Investments of long term-nature are stated at cost, less adjustment for any diminution, other than temporary, in the value thereof. Current Investment are stated at lower of cost or market value.

(d) Inventory

Finished and Semi-Finished Products produced and purchased by the company are carried at Cost and net realisable value, whichever is lower.

Work in Progress is carried at lower of cost and net realisable value.

Raw Material is carried at lower of cost and net realisable value.

Stores and Spares parts are carried at cost. Necessary provision is made and expensed in case of identified obsolete and non moving items.

Cost of Inventory is generally ascertained on the ''Weighted average'' basis. Work in progress, Finished and semi finished products are valued at on full absorption cost basis.

Cost Comprises expenditure incurred in the normal course of business in bringing such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activity. Packing Material is considered as finished goods. Consumable stores are written off in the year of Purchase.

(e) Employee Benefits

Provision for Gratuity, Leave Encashment and bonus has not been made as none of the employee have completed the minimum qualified period of services.

(f) Impairment of Assets

At each balance sheet date, the management reviews the carrying amounts of each cash generating unit to determine whether there is any indication that those assets were impaired. If any such indication exits, the recoverable amount of the assets is estimated in order to determine the extent of impairment loss. Recoverable amount is higher of an asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the assets and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the assets. Cash flows used to determine value in use are derived from annual budgets and strategic plans of the cash generating units.

(g) Revenue Recognition

Sale are recognized on when substantial risks and rewards of ownership in the goods are transferred to the buyer i.e. delivery as per terms of sale.

(h) Other Income

Interest Income and income from Investments are accounted on accrual basis.

Dividend Income is recognized when the right to receive dividend is established.

(i) Foreign Currency Transactions

Transactions in Foreign Currency and Non-Monetary Assets are accounted for at the Exchange Rate prevailing on the date of the transaction. All monetary items denominated in Foreign Currency are converted at the Year-End Exchange Rate. The Exchange Differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise.

(j) Taxes on Income

Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred Tax is recognized for all the timing differences, subject to the consideration of prudence in respect of deferred tax assets.

Deferred Tax Assets are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

(k) Cash & Cash Equivalent

Cash & Cash Equivalent for the purpose of cash flow statement comprises of cash at bank and in hand and short term investments/ bank deposits with an original maturity of three months or less.

(l) Provisions

A Provision is recognized when company has a present obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

(m) Trade Receivables:

In respect of Receivable for Sundry Debtors (Incl. Receivable on Sale of Investments) of Rs. 209.07 Lacs and Other Trade receivable, the amount of Bad & Doubtful Debts are is not ascertainable on account of non- receipt of confirmation from the party.

(n) In respect of loan and advances, the amount of bad and doubtful debts is not ascertainable on account of non- receipt of confirmation from the party.

(o) In the opinion of the Directors, Current Assets, Loans & Advances have values at which they are stated in the Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and all known liabilities is adequate.

(p) Sundry Creditors, Unsecured loans, other liabilities, loans and advances, sundry debtors, and other current assets are subject to confirmation.

(q) Micro Small & Medium Enterprise: The Company is in the process of compiling the relevant information. Dues to Micro and small enterprises have been determined to the extent such parties have been identified on the basis of information collected by the management. This has been relied upon by us.

(r) Claims, Demands and Contingencies :

Details of disputed and/ or contingent Liabilities are as follows: As on As on 31.03.2014 31.03.2013

Bank Guarantee - Expired 78,345 78,345 (Not Claimed by District Supply Office)

Motor Spirit Tax-Disputed 92,50,463 92,50,463

(Remanded)

Income Tax Demanded-Disputed 1,58,27,752 1,66,66,195

Excise Duty - Disputed 8,87,65,288 8,87,65,288

(s) In the opinion of the Management, the Provident Fund and ESI act are not applicable, hence no provision have been made for the same.

(t) Earning & Expenditure in Foreign Currency : Nil (P.Y. - Nil)

(u) Directors Remuneration : Nil (P.Y. - Nil)

(v) Auditors Remuneration : 60000 (P.Y.60000)

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Mar 31, 2012

A. COPRORATE INFORMATION

Kavit Industries Ltd is public limited - listed company incorporated in India under provision of Companies Act, 1956. The company''s strength lies in business process of manufacturing of various petrochemical downstream products such as specialty oils, petroleum sulphonates, solvents, etc. for industrial applications such as rubber, leather, ink and paint industries. It is well recognized as a ''Partner of Choice'' by leading companies across the country.

B. Basis of preparation and presentation of financial statements

The accounts of the Company are prepared under the historical cost convention on the accrual basis of accounting in accordance with the generally accepted accounting principles in India ("GAAP") and comply with the mandatory accounting standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and with the relevant provisions of the Companies Act, 1956. The financial statements are presented in Indian rupees rounded off to the nearest rupees.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting periods. Examples of such estimate include future obligations under employee benefit plans, income taxes, useful lives of fixed assets and intangible assets, impairment of assets, provision for doubtful debts etc. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could vary from these estimates. Appropriate changes in estimates are made as the management becomes aware of the changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognized in the period in which such results are known/ materialized. Effect of material changes is disclosed in the notes to the financial statements.

During the year ended March 2012, the revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company for presentation of its financial statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However, the revised Schedule VI has a significant impact on the presentation and disclosures made in the financial statements. The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

All assets and liabilities have been classified as current or non- current as per the Company''s normal operating cycle and other criteria set out in the revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisitions of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-noncurrent classification of assets and liabilities.

C. SIGNIFICANT ACCOUNTING POLICIES:

a) Fixed Assets & Depreciation.

(i) Fixed assets are stated at cost less accumulated depreciation/amortization. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

(ii) Fixed assets under construction, advances paid towards acquisition of fixed assets and cost of assets not ready for use as at the year end, are disclosed as capital work-in progress.

iii) Depreciation is provided on SLM basis at the rate and method prescribed under schedule XIV of Companies Act 1956 except Computer.

b) Investments

Investments classified as long-term investments are stated at cost. Diminution in the investment has not been worked out and provided.

c) Inventory

Inventory comprises of raw materials, Semi finished and Finished goods are valued at Cost or net realisable Value, whichever is lower. Packing Material considered as finish goods.

Consumable stores are written off in the year of Purchase.

d) Employee Benefits

Provision for gratuity has not been made as none of the employee have completed the minimum qualified period of services.

e) Claims, Demands and Contingencies

Details of disputed and or contingent liabilities are not available.

f) Provision for Current and Deferred Tax :

i) Tax liability of the company is estimated considering the provision of Income Tax Act, 1961.

ii) Deferred tax is recognized subject to consideration of prudence, on timing difference being the difference between taxable incomes and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s). Such deferred tax is quantified using rates and laws enacted or substantively enacted as at the end of the financial year. In the absence of virtual certainty of sufficient future taxable income, deferred tax assets are not recognized in the account.

g) Impairment of Assets

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the Profit and Loss Account. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

h) Revenue Recognition:

Revenue is recognized to the extent that it is probable that the economics benefits will flow to the company and the revenue can be reliably measured.

Sale of Goods :

Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are reported net of Sales Return, Sales Tax and Excise Duty.

Interest:

Revenue is recognized on a time proportion basis talking into accounts the amount outstanding and the rate applicable.

i) Foreign currency transactions

Transactions in foreign currency and non-monetary assets are accounted for at the exchange rate prevailing on the date of the transaction. All monetary items denominated in foreign currency are converted at the year-end exchange rate. The exchange differences arising on such conversion and on settlement of the transactions are recognized as income or as expenses in the year in which they arise.

D. Depreciation:

Company has not provided depreciation for the period under audit, as no major business operation has carried out during the period of audit.

E. Trade Receivables:

In respect of Receivable for Sundry debtors (Incl Receivable on Sale of Investments) of Rs. 369.71 Lacs : In absence of efforts made for the recovery and confirmation from the party, we are unable to comment whether all are considered good or Bad and doubtful.

In respect of Other Trade receivable, Balance are unconfirmed. No provision has been made for Bad & Doubtful Debts.

F. In respect of loan and advances, there are no efforts made for the recovery. No provision has been made for Bad & Doubtful Advances and interest there on.

G. In the opinion of the Director, Current Assets, Loans & Advances have value at which they are stated in the Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and for all known liabilities is adequate and not in excess of the amount reasonably necessary.

H. Sundry Creditors, Unsecured loans, other liabilities, loans and advances, sundry debtors, and other current assets are subject to confirmation and no exercise carried out to determine bad amount. If any. Accounts of Debtors are unconfirmed and no amount realize since F.Y.1999-2000. No provision has been made for Bad & Doubtful Debts.

I. Micro Small & Medium Enterprise: The company is in the process of compiling the relevant information. As the relevant information is not yet readily available and / or not given or confirmed by such enterprise, it is not possible to give required information in the accounts. However, in view of the management the impact of interest, if any which may subsequently become payable to such enterprise in accordance with the provision of the Act, would not be material and the same, if any would be disclosed in the year of payments of interest.

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Mar 31, 2010

A) Accounting convention

The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis

o) Fixed assets and depreciation

Fixed assets are stated at cost of acquisition less accumulated depreciation

Depreciation is provided on SLM basis at the rate and method prescribed under schedule XIV of companies Act 1956 on planet Machinery factory Building air conditioner office Equipment Factory Laboratory Equipment Furniture & Fixture -Factory

Depreciation is provided on WDV basis at the rate and method prescribed under schedule XIV of companies Act 1956 on computer

c) Investments

Investment classified as long -term investment are stated at cost . Diminution in the investment has not been worked out and provided

d) Inventory

Inventory comprised of raw materials semi finished and finished good are valued at cost or net realisable value which is lower.

Quality remains unverified

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Mar 31, 2008

A) Accounting Convention

The company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

b) Fixed assets and depreciation

Fixed assets are stated at cost of acquisition less accumulated depreciation.

Depreciation has not charged during the year, as the company has not undertaken any activity during the year.

c) Investments

Investments classified as long-term investments are stated at cost. Diminution in the investment has not been worked out and provided.

d) Inventory

Inventory comprises of raw materials Semi finished and Finished goods are valued at Cost or net realisable value, whichever is lower.

Quantity remains unverified.