Home  »  Company  »  Neogem India Ltd  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Neogem India Ltd. Company

Mar 31, 2014

I. Basis of 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 with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial state- ments have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

ii. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known/materialize.

iii. Fixed Assets

Fixed Assets are stated at cost net of recoverable taxes and includes amounts added on revaluation, less accumulated depreciation and impairment loss, if any.

iv. Depreciation

Depreciation on fixed assets is provided to the extent of depreciable amount on written down value method (WDV) at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 over their useful life except.

v. Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

vi. Foreign Currency Transactions

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. Monetary items denominated in foreign currencies at the year-end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year-end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c. Non-monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss account except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

vii. Investments

Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

viii. Inventories

a. Raw Material is valued at cost on FIFO basis or Market Value whichever is lower.

b. WIP Stock is valued at cost on FIFO basis.

c. Finished Goods is valued at cost on FIFO basis or net realizable value whichever is lower.

d. Diamond included in the above stock is valued at specific identification method on FIFO basis

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any.

Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

ix. Revenue Recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

The Company recognizes revenue on dispatch of goods. In case of Job Work, the revenue is recognized upon com- pletion of the job and dispatch of goods.

Revenue from operations includes sale of goods, services, sales tax, service tax, excise duty and sales during trial run period, adjusted for discounts (net), Value Added Tax (VAT) and gain/loss on corresponding hedge contracts.

Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

x. Employee Benefits

Gratuity

In respect of Gratuity, the provision is made on Accrual Basis as per actuarial valuation at the year end.

Leave Encashment

Provision is made for Leave Encashment liability on the basis of Actual Calculation.

Provident Fund & Family Pension

Contribution to provident fund & family pension fund are provided for & payments in respect thereof are made to the relevant authorities on actual basis.

Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss ac- count of the year in which the related service is rendered.

Post-employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post- employment and other long term benefits are charged to the Profit and Loss account.

xi. Financial Derivatives and Commodity Hedging Transactions

Financial derivatives and commodity hedging contracts are accounted on the date of their settlement. In respect of derivative contracts, premium paid, gains/losses on settlement and losses on restatement are recognized in the Profit and Loss account except in case where they relate to the acquisition or construction of fixed assets, in which case, they are adjusted to the carrying cost of such assets.

xii. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

xiii. Provision for Current and Deferred Tax

Provision for current tax is made after taking in to consideration benefits admissible under the provisions of the Income tax Act, 1961.

Deferred tax resulting from "Timing Difference" between Block and Taxable profit is accounted for using the tax rates & laws that have been enacted or substantively enacted on the balance sheet date. The Deferred tax assets is recognized and carried forward only to the extent that there is virtual certainty supported by convincing evidence that the asset will be realized in future.

Net outstanding balance in Deferred tax account is recognized as Deferred tax liabilities/asset.

The Deferred tax account is used solely for reversing timing difference as and when crystallized.

xiv. Cash Flow Statement

The Cash Flow statement is being prepared in accordance with the format prescribed in Accounting Standard 3 prescribed by the ICAI.

xv. Prior Period Items

All identifiable items of Income and Expenditure pertaining to prior period are accounted through "Income/Expense of earlier year accounts"

xvi. Related Party Transaction

Disclosure of transaction with Related Parties, as required by Accounting Standard 18 "Related Party Disclosure" has been set out in a separate note forming part of this schedule. Related parties as defined under clause 3 of the accounting standard 18 have been identified on the basis of representations made by key management personnel and information available with the company.

xvii. Earning per Share

Basic and Diluted earnings per share are calculated by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.


Mar 31, 2013

I. Basis of 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 with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

ii. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

iii. Fixed Assets

Fixed Assets are stated at cost net of recoverable taxes and includes amounts added on revaluation, less accumulated depreciation and impairment loss, if any.

iv. Depreciation

Depreciation on fixed assets is provided to the extent of depreciable amount on written down value method (WDV) at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 over their useful life except.

v. Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

vi. Foreign Currency Transactions

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. Monetary items denominated in foreign currencies at the year-end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year-end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c. Non-monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss account except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

vii. Investments

Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

viii. Inventories

a. Raw Material is valued at cost on FIFO basis or Market Value whichever is lower.

b. WIP Stock is valued at cost on FIFO basis.

c. Finished Goods is valued at cost on FIFO basis or net realizable value whichever is lower.

d. Diamond included in the above stock is valued at specific identification method on FIFO basis

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any.

Cost of inventories comprises of cost of purchase, cost of conversion and other cost including manufacturing overheads incurred in bringing them to their respective present location and condition.

ix. Revenue Recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

The Company recognizes revenue on dispatch of goods. In case of Job Work, the revenue is recognized upon completion of the job and dispatch of goods.

Revenue from operations includes sale of goods, services, sales tax, service tax, excise duty and sales during trial run period, adjusted for discounts (net), Value Added Tax (VAT) and gain / loss on corresponding hedge contracts.

Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

x. Employee Benefits

Gratuity

In respect of Gratuity, the provision is made on Accrual Basis as per actuarial valuation at the year end.

Leave Encashment

Provision is made for Leave Encashment liability on the basis of Actual Calculation.

Provident Fund & Family Pension

Contribution to provident fund & family pension fund are provided for & payments in respect thereof are made to the relevant authorities on actual basis.

Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

Post-employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post- employment and other long term benefits are charged to the Profit and Loss account.

xi. Financial Derivatives and Commodity Hedging Transactions

Financial derivatives and commodity hedging contracts are accounted on the date of their settlement. In respect of derivative contracts, premium paid, gains / losses on settlement and losses on restatement are recognized in the Profit and Loss account except in case where they relate to the acquisition or construction of fixed assets, in which case, they are adjusted to the carrying cost of such assets.

xii. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

xiii. Provision for Current and Deferred Tax

Provision for current tax is made after taking in to consideration benefits admissible under the provisions of the Income tax Act, 1961.

Deferred tax resulting from "Timing Difference" between Block and Taxable profit is accounted for using the tax rates & laws that have been enacted or substantively enacted on the balance sheet date. The Deferred tax assets is recognized and carried forward only to the extent that there is virtual certainty supported by convincing evidence that the asset will be realized in future.

Net outstanding balance in Deferred tax account is recognized as Deferred tax liabilities / asset.

The Deferred tax account is used solely for reversing timing difference as and when crystalized.

xiv. Cash Flow Statement

The Cash Flow statement is being prepared in accordance with the format prescribed in Accounting Standard 3 prescribed by the ICAI.

xv. Prior Period Items

All identifiable items of Income and Expenditure pertaining to prior period are accounted through "Income / Expense of earlier year accounts"

xvi. Related Party Transaction

Disclosure of transaction with Related Parties, as required by Accounting Standard 18 "Related Party Disclosure" has been set out in a separate note forming part of this schedule. Related parties as defined under clause 3 of the accounting standard 18 have been identified on the basis of representations made by key management personnel and information available with the company.

xvii. Earning per Share

Basic and Diluted earnings per share are calculated by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.


Mar 31, 2012

I. Basis of 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 with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

ii. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

iii. Fixed Assets

Fixed Assets are stated at cost net of recoverable taxes and includes amounts added on revaluation, less accumulated depreciation and impairment loss, if any.

iv. Depreciation

Depreciation on fixed assets is provided to the extent of depreciable amount on written down value method (WDV) at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956 over their useful life except.

v. Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

vi. Foreign Currency Transactions

a. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.

b. Monetary items denominated in foreign currencies at the year-end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year-end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

c. Non-monetary foreign currency items are carried at cost.

d. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Profit and Loss account except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

vii. Investments

Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

viii. Inventories

a. Raw Material is valued at cost on FIFO basis or Market Value whichever is lower.

b. WIP Stock is valued at cost on FIFO basis.

c. Finished Goods is valued at cost on FIFO basis or net realizable value whichever is lower.

d. Diamond included in the above stock is valued at specific identification method on FIFO basis.

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any.

Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

ix. Revenue Recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

The Company recognizes revenue on dispatch of goods. In case of Job Work, the revenue is recognized upon completion of the job and dispatch of goods.

Revenue from operations includes sale of goods, services, sales tax, service tax, excise duty and sales during trial run period, adjusted for discounts (net), Value Added Tax (VAT) and gain / loss on corresponding hedge contracts.

Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

x. Employee Benefits Gratuity

In respect of Gratuity, the provision is made on Accrual Basis as per acturial valuation at the year end.

Leave Encashment

Provision is made for Leave Encashment liability on the basis of Actual Calculation.

Provident Fund & Family Pension Contribution to provident fund & family pension fund are provided for & payments in respect thereof are madeto the relevant authorities on actual basis.

Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

Post-employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post- employment and other long term benefits are charged to the Profit and Loss account.

xi. Financial Derivatives and Commodity Hedging Transactions

Financial derivatives and commodity hedging contracts are accounted on the date of their settlement. In respect of derivative contracts, premium paid, gains / losses on settlement and losses on restatement are recognized in the Profit and Loss account except in case where they relate to the acquisition or construction of fixed assets, in which case, they are adjusted to the carrying cost of such assets.

xii. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

xiii. Provision for Current and Deferred Tax

Provision for current tax is made after taking in to consideration benefits admissible under the provisions of the Income tax Act, 1961.

Deferred tax resulting from ETiming Differences between Block and Taxable profit is accounted for using the tax rates & laws that have been enacted or substantively enacted on the balance sheet date. The Deferred tax assets is recognized and carried forward only to the extent that there is virtual certainty supported by convincing evidence that the asset will be realized in future.

Net outstanding balance in Deferred tax account is recognized as Deferred tax liabilities / asset.

The Deferred tax account is used solely for reversing timing difference as and when crystalized.

xiv. Cash Flow Statement

The Cash Flow statement is being prepared in accordance with the format prescribed in Accounting Standard 3 prescribed by the ICAI.

xv. Prior Period Items

All identifiable items of Income and Expenditure pertaining to prior period are accounted through H Income / Expense of earlier year accountsffl

xvi. Related Party Transaction

Disclosure of transaction with Related Parties, as required by Accounting Standard 18 H Related Party Disclosures has been set out in a seprate not forming part of this schedule. Related parties as defined under clause 3 of the accounting standard 18 have been identified on the basis of representations made by key management personnel and information available with the company.

xvii. Earning per Share

Basic and Diluted earnings per share are calculated by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

During the finacial year 2008-09 the company had issued 15,65,000 prefential share warrant which were to be converted into 15,65,000 Equity shares of Rs. 10 each at par on or before 14th April, 2010. Out of which 3,90,000 prefential share warrant converted into 3,90,000 equity shares on 31st March, 2010. And balance 11,75 000 prefential share warrant converted into 11,75.000 equity shares 14th April, 2010. Further the Company had taken approval of the shareholders at the A.G.M. held on 30th September 2010 for the issue of 15,60,000 preferential share warrants against which 25% application money has been received and the In-Principal Approval from the Bombay Stock Exchange is in process.


Mar 31, 2011

1) BASIS OF ACCOUNTING :

The Accounts of the Company are prepared under the historical cost convention using the Accrual method of Accounting.

2) REVENUE RECOGNITION:

The Company recognises Revenue on Despatch of goods. In the case of job work, the revenue is recognised upon completion of the job and despatch of goods.

3) USE OF ESTIMATES :

The preparation of financial statements is in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, reported amounts of revenues and expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized in the period in which such revisions are made.

4) FIXED ASSETS:

Fixed Assets are stated at their original cost including incidental expenses related to acquisation and installation less accumalated depreciation.

5) DEPRECIATION:

The Company has been providing depreciation on Straight Line Basis and in accordance with the rates specified in Schedule XIV of The Companies Act,1956.

6) INVENTORIES: Inventories are valued as under:

a) Raw Material is valued at Cost on FIFO Basis or Market Value which ever is lower.

b) WIP Stock is valued at cost on FIFO basis.

c) Finished Goods is valued at cost on FIFO basis or net realisable value which ever is lower.

d) Diamond included in the above stock is valued at specific identification method on FIFO basis.

7) FOREIGN EXCHANGE TRANSACTIONS :

a) Monetary items denominated in foreign currencies at the year end are restated at the rate of exchange ruling at the Balance Sheet Date.

b) Transactions arising in foreign currency during the year are converted at rate closely approximating those ruling on the transaction date. Exchange difference due on actual realisation or actual payment are taken to revenue or are capitalised as the case may be.

8) RETIREMENT BENEFITS :

Gratuity

In respect of Gratuity, the provision is made on Accrual Basis as per acturial valuation at the year end.

Leave Encashment

Provision is made for Leave Encashment liability on the basis of Actual Calculation.

Provident Fund & Family Pension

Contribution to Provident Fund & Family Pension Fund are provided for & payments in respect thereof are made to the relevant authorities on actual basis.

9) COMMODITY HEDGING TRANSACTIONS:

Financial Derivatives and commodity hedging contracts are accounted on the date of their settlement and realised gain/ loss in respect of settled contracts are recognised in the Profit and Loss Account, along with the underlying transactions.

10) IMPAIRMENT OF ASSETS :

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

11) PROVISION FOR CURRENT & DEFFERED TAX

Provision for Current Tax is made after taking into consideration benefits admissible under the provisions of Income Tax Act, 1961

Deffered Ta x resulting from “Timing Difference” between Book and Taxable Profit is accounted for using the tax rates & laws that have been enacted or substantively enacted on the Balance Sheet date.The Deffered Tax Asste is recognised and carried forward only to the extent that there is a virtual certainity supported by convincing evidence that the asset will be realised in future.

Net outstanding balance in Deffered Tax account is recognised as Deffered Tax Laibility/Asset The Deffered Tax account is used soley for reversing timing difference as and when crystalized.

12) CASH FLOW STATEMENT :

The Cash flow Statement is being prepared in accordance with the format prescribed in Accounting Stanadard-3 prescribed by the Institute of Chartered Accountants of India.

13) PRIOR PERIOD ITEMS :

All identifiable items of Income and Expenditure pertaining to prior period are accounted through “Income / Expense of earlier years Account”

14) RELATED PARTY TRANSACTIONS :

Disclosure of transactions with Related Parties, as required by Accounting Standard 18 “Related Party Disclosures” has been set out in a separate note forming part of this Schedule. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representations made by key managerial personnel and information available with the Company.

15) EARNING PER SHARE :

The Company reports basic and diluted earnings per share (EPS) in accordance with the Accounting Standard 20 issued by The Institute of Chartered Accountants of India. The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year The Diluted EPS has been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding at the end of the year.

16) DOUBTFUL DEBTS/ADVANCES / DEPOSITS/ INVESTMENT :

Provision is made in the accounts for Debts / Advances / Deposits / Investment which in the opinion of the management are considered doubtful of recovery.

17) PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS :

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

18) INVESTMENT

Long-term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than termporary in the opinion of the management.


Mar 31, 2010

1) BASIS OF ACCOUNTING:

The Accounts of the Company are prepared under the historical cost convention using the Accrual method ot Accounting.

2) REVENUE RECOGNITION:

The Company recognises Revenue on Despatch of goods. In the case of job work, the revenue is recognised upon completion of the job and despatch of goods.

3) USE OF ESTIMATES :

The preparation of financial statements is in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, reported « amounts of revenues and expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized in the period in which such revisions are made.

4) FIXED ASSETS:

Fixed Assets are stated at their original cost including incidental expenses related to acquisation and installation less accumalated depreciation.

5) DEPRECIATION:

The Company has been providing depreciation on Straight Line Basis and in accordance with the rates specified in Schedule XIV of The Companies Act, 1956.

6) INVENTORIES:

Inventories are valued as under:

a) Raw Material is valued at Cost on FIFO Basis or Market Value which ever is lower.

b) WIP Stock is valued at cost on FIFO basis.

c) Finished Goods is valued at cost on FIFO basis or net realisable value which ever is lower.

d) Diamond included in the above stock is valued at specific identification method on FIFO basis.

7) FOREIGN EXCHANGE TRANSACTIONS:

a) Monetary items denominated in foreign currencies at the year end are restated at the rate of exchange ruling at the Balance Sheet Date.

b) Transactions arising in foreign currency during the year are converted at rate closely approximating those ruling on the transaction date. Exchange difference due on actual realisation or actual payment are taken to revenue or are capitalised as the case may be.

8) RETIREMENT BENEFITS : Gratuity

In respect of Gratuity, the provision is made on Accrual Basis as per acturial valuation at the year end.

Leave Encashment

Provision is made for Leave Encashment liability on the basis of Actual Calculation.

Provident Fund & Family Pension

Contribution to Provident Fund & Family Pension Fund are provided for & payments in respect thereof are made to the relevant authorities on.actual basis.

9) COMMODITY HEDGING TRANSACTIONS:

Financial Derivatives and commodity hedging contracts are accounted on the date of their settlement and realised gain loss in respect of settled contracts are recognised in the Profit and Loss Account, along with the underlying transactions.

10) IMPAIRMENT OF ASSETS :

An asset is treated as impaired when the carrying cost of.assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

11) PROVISION FOR CURRENT & DEFFERED TAX

Provision for Current Tax is made after taking into consideration benefits admissible under the provisions of Income Tax Act, 1961

Deffered Tax resulting from "Timing Difference" between Book and Taxable Profit is accounted for using the tax rates & laws that have been enacted or substantively enacted on the Balance Sheet date.The Deffered Tax Asste is recognised and carried forward only to the extent that there is a virtual certainity supported by convincing evidence that the asset will be realised in future.

Net outstanding balance in Deffered Tax account is recognised as Deffered Tax Laibility/Asset The Deffered Tax account is used soley for reversing timing difference as and when crystalized.

12) CASH FLOW STATEMENT :

The Cash flow Statement is being prepared in accordance with the format prescribed in Accounting Stanadard-3 prescribed by the Institute of Chartered Accountants of India.

13) PRIOR PERIOD ITEMS :

All identifiable items of Income and Expenditure pertaining to prior period are accounted through "Income / Expense of earlier years Account"

14) RELATED PARTY TRANSACTIONS :

Disclosure of transactions with Related Parties, as required by Accounting Standard 18 "Related Party Disclosures" has been set out in a separate note forming part of this Schedule. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representations made by key managerial personnel and information available with the Company.

15) EARNING PER SHARE :

The Company reports basic and diluted earnings per share (EPS) in accordance with the Accounting Standard 20 issued by The Institute of Chartered Accountants of India. The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year The Diluted EPS has been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding at the end of the year.

16) DOUBTFUL DEBTS/ADVANCES/DEPOSITS/INVESTMENT:

Provision is made in the accounts for Debts / Advances / Deposits / Investment which in the opinion of the management are considered doubtful of recovery.

17) PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS :

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

18) INVESTMENT

Long-term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than termporary in the opinion of the management.

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X