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Accounting Policies of M P Agro Industries Ltd. Company

Mar 31, 2014

A. Basis of Presentation

The accounts have been prepared using historical cost convention and on the basis of a going concern, with revenues recognized and expenses accounted for on accrual (including for committed obligations), in accordance with the accounting standard prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government, in consultation with the National Advisory Committee on Accounting Standards, to the extent applicable. Insurance and other claims are accounted for, as and when admitted by the appropriate authorities.

B. Fixed Assets

a. Capitalized at acquisition cost including directly attributable cost such as freight insurance and specific installation charge for bringing the asset to its working condition for use

b. Expenditure relating to existing fixed assets is added to the cost of the assets where it increases the performance/life of the assets as assessed earlier.

C. Depreciation

a) Depreciation is charged on Other Assets as per the Straight Line Method from the date of installation/use asset at the rates and in the manner prescribed under schedule X1V to the Companies Act, 1956.

b) Depreciation on additions / deductions to the Fixed Assets is being provided on prorata basis from/ to the month of acquisition / disposal.

D. Investments

Long Term Investments are stated at cost less provision, if any, for decline other than temporary in their value.

E. Recognition of Incomes

a) Revenues/Incomes are generally accounted on accrual, as they are earned.

b) Sale of goods is recognized on transfer of property in goods or on transfer of significant risks and reward of ownership to the buyer, which is generally on dispatch of goods.

F. Contingencies and Events occurring after the date of Balance Sheet

a) Accounting for contingencies (gains and losses) arising out of contractual obligations are made only on the basis of mutual acceptance.

b) Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.

G. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An asset is impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

H. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognized in the period in which the results are known/materialized.

I. Accounting for Taxes on Income

a) Provision for taxation for the year under report includes provision for current tax as well as provision for deferred tax.

b) Provision for Current tax is made, based on tax estimated to be payable as computed under the various provisions of the Income Tax Act, 1961.

c) Deferred tax is recognised, subject to prudence, on timing differences between taxable income and accounting income that originate during the year and are capable of being reversed in one or more subsequent periods. Deferred tax assets are recognised only to the extent that there is reasonable certainty that future taxable income will be available against which such deferred tax assets can be realized.

d) Deferred Tax Liabilities / Assets are quantified using the tax rates and tax laws enacted or substantively enacted as on the balance sheet date.

Mar 31, 2010


The company adopts the accrual concept in preparation of accounts.


Assets and liabilities are recorded at historical cost to the company. The costs are not adjusted to reflect the changes in the purchasing power of money.


Assets and liabilities are recorded at historical cost to the company. The costs are not adjusted to reflect the changes in the purchasing power of money.


Fixed Assets are capitalized at cost inclusive of installation expenses.


a. Stores and spares, packing materials, raw materials and stock in process are evaluated at cost and on the basis of first- in - first-out.

b. Stocks of used bags are evaluated on basis of estimated selling price.

c. Finished goods, whether I stock at factory or at other places are evaluated on the basis of cost or selling price, whichever is lower.


- Depreciation on Fixed Assets up to 31st December, 1987 is provided on straight line method, at the rates applicable under the income tax rates as in for at the time of acquisition / purchase of assets.

- Depreciation on Fixed assets form 1st January, 1988 has been provided on straight- line method at the rates specified in Schedule - XIV of the Companies Act, 1956 as amended with effect form 16.12.93.

- No depreciation is charged on the Fixed Assets during the financial year as the company has closed its operations during the immediately preceding previous financial year.


Shares issue expenses has been written off 1710th every year.