Accounting Policies of Madhusudan Industries Ltd. Company

Mar 31, 2015

* Basis of Accounting

The Company prepares its financial statements under the historical cost convention, on accrual basis of accounting, to comply in all material respects with notified Accounting Standards by the Companies Accounting Standard Rules, 2006 and the relevant provisions of the Companies Act, 1956, in Pursuant to transitional provision with respect to accounting standard u/s. 133 of the Companies Act, 2013.

* Sales

Sales is net of discounts and Value Added Tax

* Retirement Benefits

(i) Provident Fund is a defined contribution and it is charged to revenue for the year when due.

(ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial valuation. The Company has no further obligation except contribution to the fund.

(iii) Leave encashment benefit is accounted for on the basis of actuarial valuation made at the end of each year.

* Fixed Assets & Depreciation

(a) Fixed Assets are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets.

(b) Assets acquired under hire purchase installment credit scheme, the cost of asset is capitalised while the annual financial charges at equated instalments are charged to revenue.

(c) Depreciation for the year is provided at the rates and in the manner specified in Schedule-II of the Companies Act, 2013 as under:

(1) On Plant & Machinery and Electric Installation on straight-line method on the residual life of the respective assets.

(2) On other assets on written down value method on the residual life of the respective assets.

(d) Leasehold land is amortised over the period of lease.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

* Inventories

(a) Raw-materials, packing materials, stores, and chemicals are taken at lower of cost or net realisable value following FIFO Method.

(b) Stock-in-Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.

(e) By-products are valued at - net realisable value.

* Investments

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

* Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetory assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss account. Exchange differencesarising in respect of fixed assets acquired from outside India on or before accounting period commencing before December 2006 were capitalised as part of fixed assets.

* Borrowing Costs

Borrowing Costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

* Taxation

Provision for tax for the year comprises current income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s).

* Earning per share

The earning considered in ascertaining the company's Earnings per share (EPS) comprise the net profit aftertax. The number of share used in computing Basic EPS is the weighted average number of shares outstanding during the year. The diluted is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares.

* Impairment of Assets

Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the asset's net selling price and its value in use.

* Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and Contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.

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Mar 31, 2014

* Basis of Accounting

The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.

* Sales

Sales is net of discounts and Value Added Tax

* Retirement Benefits

(i) Contribution to Provident Fund is made at applicable rates.

(ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial valuation. The Company has no further obligation except contribution to the fund.

(iii) Leave encashment benefit is accounted for on the basis of actuarial valuation.

* Fixed Assets & Depreciation

(a) Fixed Assets are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets.

(b) Assets acquired under hire purchase instalment credit scheme, the cost of asset is capitalised while the annual financial charges at equated instalments are charged to revenue.

(c) Depreciation for the year is provided at the rates and in the manner specified in Schedule-XIV of the Companies Act, 1956 as under:

(1) On Plant & Machinery and Electric Plant & Installation on straight-line method.

(2) On other assets on written down value method.

(d) Leasehold land is amortised over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalised, but the contracted lease rentals are charged to revenue on accrual basis.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

* Inventories

(a) Raw-materials, packing materials, stores, coal and chemicals are taken at lower of cost or net realisable value following (FIFO Method)

(b) Stock-in-Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.

(e) By-products are valued at - net realisable value.

* Investments

Investments are stated at cost.

* Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction.

Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss account. Exchange differences arising in respect of fixed assets acquired from outside India on or before accounting period commencing before December 2006 were capitalised as part of fixed assets.

* Borrowing Costs

Borrowing Costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

* Taxation

Provision for tax for the year comprises current income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period (s).

* Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and Contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.

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Mar 31, 2013

* Basis of Accounting

The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.

* Sales

Sales is net of discounts and Value Added Tax

* Retirement Benefits

(i) Contribution to Provident Fund is made at applicable rates.

(ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial valuation. The Company has no further obligation except contribution to the fund

(iii) Leave encashment benefit is accounted for on the basis of actuarial valuation.

* Fixed Assets & Depreciation

(a) Fixed Assets are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets.

(b) Assets acquired under hire purchase instalment credit scheme, the cost of asset is capitalised while the annual financial charges at equated instalments are charged to revenue.

(c) Depreciation for the year is provided at the rates and in the manner specified in Schedule-XIV of the Companies Act, 1956 as under:

(1) On Plant & Machinery and Electric Plant & Installation on straight-line method.

(2) On other assets on written down value method.

(d) Leasehold land is amortised over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalised, but the contracted lease rentals are charged to revenue on accrual basis.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

* Inventories

(a) Raw-materials, packing materials, stores, coal and chemicals are taken at lower of cost or net realisable value following ( FIFO Method)

(b) Stock-in-Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.

(e) By-products are valued at - net realisable value.

* Investments

Investments are stated at cost.

* Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction.

Gains and losses resulting from the settlement of such transactions and from the translation of monetory assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss account. Exchange differences arising in respect of fixed assets acquired from outside India on or before accounting period commencing before December 2006 were capitalised as part of fixed assets.

* Borrowing Costs

Borrowing Costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

* Taxation

Provision for tax for the year comprises current income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period (s).

* Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.

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Mar 31, 2012

- Basis of Accounting

The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.

- Sales

Sales is net of discounts and Value Added Tax

- Retirement Benefits

(i) Contribution to Provident Fund is made at applicable rates.

(ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial valuation. The Company has no further obligation except contribution to the fund

(iii) Leave encashment benefit is accounted for on the basis of actuarial valuation.

- Fixed Assets & Depreciation

(a) Fixed Assets are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets.

(b) Assets acquired under hire purchase instalment credit scheme, the cost of asset is capitalised while the annual financial charges at equated instalments are charged to revenue.

(c) Depreciation for the year is provided at the rates and in the manner specified in Schedule-XIV of the Companies Act, 1956 as under:

(1) On Plant & Machinery and Electric Plant & Installation on straight-line method.

(2) On other assets on written down value method.

(d) Leasehold land is amortised over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalised, but the contracted lease rentals are charged to revenue on accrual basis.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

- Inventories

(a) Raw-materials, packing materials, stores, coal and chemicals are taken at lower of cost or net realisable value following (FIFO Method)

(b) Stock-in-Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.

(e) By-products are valued at - net realisable value.

- Investments

Investments are stated at cost.

- Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction.

Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss account. Exchange differences arising in respect of fixed assets acquired from outside India on or before accounting period commencing before December 2006 were capitalised as part of fixed assets.

- Borrowing Costs

Borrowing Costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

- Taxation

Provision for tax for the year comprises current income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period (s).

- Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and Consignment liabilities not provided for in the accounts are disclosed by way of notes to the accounts.

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Mar 31, 2010

- Basis of Accounting

The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.

Sales

Sales is net of discounts and Value Added Tax

- Retirement Benefits

(i) Contribution to Provident Fund is made at applicable rates.

» (ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial

valuation. The Company has no further obligation except contribution to the fund. (iii) Leave encashment benefit is accounted for on the basis of actuarial valuation.

- Fixed Assets & Depreciation

(a) Fixed Assets are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets.

(b) Assets acquired under hire purchase instalment credit scheme, the cost of asset is capitalised while the annual financial charges at equated instalments are charged to revenue.

(c) Depreciation for the year is provided at the rates and in the manner specified in Schedule - XIV of the Companies Act, 1956 as under:

(1) On Plant & Machinery. and Electric Plant & Installation on straight-line method.

(2) On other assets on written down value method.

(d) Leasehold land is amortised over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalised, but the contracted lease rentals are charged to revenue on accrual basis.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

- Inventories

(a) Raw-materials, packing materials, stores, coal and chemicals are taken at lower of cost or net realisable value following (FIFO Method)

(b) Stock - in - Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods. . ,

(e) By-products are valued at - net realisable value.

- Investments Investments are stated at cost.

- Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss account. Exchange differences arising in respect of fixed assets acquired from outside India on or before accounting period commencing before December 2006 were capitalised as part of fixed assets.

- Borrowing Cost

Borrowing Costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

- Taxation

Provision for tax for the year comprises current income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s).

- Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and Contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.