Accounting Policies of Senbo Industries Ltd. Company

Mar 31, 2014

1.1 BASIS OF ACCOUNTING

The financial statements are prepared under the historical cost convention, on accrual basis of accounting (save and except bonus and gratuity payment) in accordance with the Indian Generally Accepted Accounting Principles (GAAP), applicable Accounting Standards notified by Companies (Accounting Standards) Rules, 2006. The Accounting policies are consistently applied by the Company.

1.2 USE OF ESTIMATE

The preparation of financial statements in conformity with Indian GAAP which requires the management to make estimated assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of policies during the reporting period. Although these estimates are based upon managements'' best knowledge of current events and activities, actual results could differ from these estimates.

1.3 FIXED ASSETS

Fixed Assets are stated at cost, less accumulated depreciation and impairment loss, if any. Cost includes all expenditure related to acquisition and installation.

1.4 DEPRECIATION

(a) Depreciation of fixed assets is provided on straight line basis at the rate specified in Schedule XIV of the Companies Act,1956, as amended up to date.

(b) Depreciation on asset purchased/acquired/installed during the year is charged from the date of such event . Similarly depreciation on assets sold/discarded during the year is charged upto the date of the event.

1.5 IMPAIRMENT

Fixed assets are reviewed at each Balance Sheet date for impairment. In case events and circumstances indicate any impairment, recoverable amount of fixed assets is determined. An impairment loss is recognized, whenever the carrying amount of the assets either belonging to the Cash Generating Unit (CGU) or otherwise, exceeds recoverable amount. The recoverable amount is the greater of net selling price of the assets or its value in use.

1.6 INVENTORIES

Inventories of raw materials, packaging materials, fuel, stores & spares valued at lower of procurement cost (weighted average basis) and net realisable value.

1.7 BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets. All other borrowing costs are charged to revenue.

1.8 REVENUE RECOGNITION

Revenue arising out of sale of products is recognized upon passage of title to the customers, which generally coincides with their delivery.

1.9 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

(a) A provision is recognised when the company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimate.

(b) Contingent liabilities are disclosed by way of notes to accounts.

(c) Contingent Assets are not recognised except for the purpose of settlement of dispute / claim.

1.10 SEGMENT-WISE REPORTING

Not applicable since at present there are no business activities of the Company.

1.11 EMPLOYEE BENEFITS

(a) Defined contribution to provident fund and employee state insurance are charged to profit & loss account of the year when the contributions to the respective funds are due.

(b) Bonus and Gratuity is accounted for as and when disbursed.

1.12 EARNING PER SHARE

Basic earning per share is calculated by dividing the net profit or loss after tax and include post tax effect of any extra-ordinary item for the period attributable to equity shareholders by the weighted average number of equity share outstanding during the period. The weighted average number of equity shares as outstanding during the period are adjusted for event including a bonus issue, bonus element in a right issue, split of shares or reverse split (i.e. consolidation of shares) etc. made during the year.

1.13 PROVISION FOR TAXATION

(a) Net Profit (Loss) is arrived at after considering current and deferred tax.

(b) A provision is made for the current tax based on tax liability computed in accordance with relevant tax rates and tax laws. A provision is made for deferred tax for all timing differences arising between taxable income and accounting income at current rate of taxes.

(c) Deferred tax assets are recognised only if there is reasonable certainty that they will be realized and are reviewed at each balance sheet date.

1.14 FOREIGN CURRENCY TRANSACTION

Where applicable foreign currency transactions are accounted for at the exchange rate prevailing at the transaction date. Year end assets and liabilities in foreign currency are translated at the applicable year end exchange rates and the resultant difference is recognised as gain / loss for the year.

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Mar 31, 2012

1.1 BASIS OF ACCOUNTING

The financial statements are prepared under the historical cost convention, on accrual basis of accounting (save and except bonus, gratuity and interest receivable on security deposit with Central Medical Stores) to comply with the mandatory accounting standards as notified under the Companies (Accounting Standard) Rules 2006 pursu ant to Section 211 (3C) of the Companies Act, 1956 and in conformity with the accounting principles as generally accepted in India (Indian GAAP) as applicable, and the relevant provisions of the Companies Act, 1956, The Accounting policies are consistently applied by the Company.

1.2 USE OF ESTIMATE

The preparation of financial statements in conformity with GAAP requires management to make estimated assump- tions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of policies during the reporting period. Although these estimates are based upon managements' best knowledge of current events and activities, actual results could differ from these esti- mates.

1.3 FIXED ASSETS

(a) Fixed Assets are stated at cost, less accumulated depreciation and impairment loss, if any. Cost includes all expenditure necessary to bring the asset to its working condition for its intended use.

(b) The carrying value of fixed assets which are in excess of higher of its value in use or net realisable value is recognised as an impairment loss.

1.4 DEPRECIATION

(a) Depreciation of fixed assets is provided on straight line basis at the rate specified in Schedule XIV of the Companies Act,1956, as amended up to date.

(b) Depreciation on asset purchased/acquired/instafled during the year is charged from the date of such event. Similarly depreciation on assets sold/discarded during the year is charged upto the date of the event.

1.5 IMPAIRMENT

Fixed assets are reviewed at each Balance Sheet date for impairment. In case events and circumstances indicate any impairment, recoverable amount of fixed assets is determined. An impairment loss is recognized, whenever the carrying amount of the assets either belonging to the Cash Generating Unit (CGU) or otherwise, exceeds recoverable amount. The recoverable amount is the greater of net selling price of the assets or its value in use. In assessing value in use the estimated future cash flows from the use of the assets are discounted to their present value at appropriate rate. An impairment loss is reversed if there has beers change in the recoverable amount and such loss either no longer exists or has decreased. Impairment loss/reversal thereof is adjusted to the carrying value of the respective assets, which in case of CGU are allocated to its assets on pro-rata basis.

1.6 INVENTORIES

(a) Inventories of raw materials, packaging materials, fuel, stores & spares valued at lower of procurement cost (weighted average basis) and net realisable value.

(b) Where applicable Inventories of work-in-progress and finished goods are valued at lower of cost and net realisable value. Cost of inventories includes direct materials, labour and a portion of manufacturing overheads based on normal operating capacity.

1.7 BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets. All other borrowing costs are charged to revenue.

1.8 REVENUE RECOGNITION

Revenue arising out of sale of trial products is recognized upon passage of title to the customers, which generally coincides with their delivery. Adjustments, if any, arising out of price difference claims, etc. are accounted for as and when they are finally determined.

1.9 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

(a) A provision is recognised when the company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimate required to settle the obiigation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimate.

(b) Contingent Liabilities are disclosed by way of notes to accounts.

(c) Contingent Assets are not recognised except for the purpose of settlement of dispute/claim.

1.10 SEGMENT-WISE REPORTING

Not applicable since at present there are no business activities of the Company.

1.11 EMPLOYEE BENEFITS

(a) Defined contribution to provident fund and employee state insurance are charged to profit & loss account of the year when the contributions to the respective funds are due.

(b) Bonus and Gratuity is accounted for as and when disbursed.

1.12 POLICY ON EARNING PER SHARE

Basic earning per share is calculated by dividing the net profit or loss after tax and include post tax effect of any extra-ordinary item for the period attributable to equity shareholders by the weighted average number of equity share outstanding during the period. The weighted average number of equity shares as outstanding during the period are adjusted for event including a bonus issue, bonus element in a right issue, split of shares or reverse split (i.e. consolidation of shares) etc. made during the year.

1.13 PROVISION FOR TAXATION

(a) Net Profit (Loss) is arrived at after considering current and deferred tax.

(b) A provision is made for the current tax based on tax liability computed in accordance with relevanl tax rates and tax laws. A provision is made for deferred tax for all timing differences arising between taxable income and accounting income at currently or substantively enacted tax laws.

(c) Deferred tax assets are recognised only if there is reasonable certainty that they will be realized and are reviewed for the appropriations of their respective carrying values at each balance sheet date.

1.14 FOREIGN CURRENCY TRANSACTION

Where applicable Foreign currency transactions are accounted for at the exchange rate prevailing at the trans- action date. Year and monetary assets and liabilities in foreign currency are translated at the applicable year end exchange rates and the resultant difference is recognised as gain/loss for the year.

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Mar 31, 2010

1.1 BASIS OF ACCOUNTING

The financial statements are prepared under the historical cost convention, on accrual basis of accounting (save and except bonus, gratuity and interest receivable on security deposit with Central Medical Stores) to comply with the mandatory accounting standards as notified under the Companies (Accounting Standard) Rules 2006 pursuant to Section 211 (3C) of the Companies Act, 1956 and in conformity with the accounting principles as generally accepted in India (Indian GAAP) as applicable, and the relevant provisions of the Companies Act, 1956. The Accounting policies are consistently applied by the Company.

1.2 USE OF ESTIMATE

The preparation of financial statements in conformity with GAAP requires management to make estimated assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of policies during the reporting period. Although these estimates are based upon managements best knowledge of current events and activities, actual results could differ from these estimates.

1.3 FIXED ASSETS

(a) Fixed Assets are stated at cost, less accumulated depreciation and impairment loss, if any. Cost includes all expenditure necessary to bring the asset to its working condition for its intended use.

(b) The carrying value of fixed assets which are in excess of higher of its value in use or net realisable value is recognised as an impairment loss.

1.4. DEPRECIATION

(a) Depreciation of fixed assets is provided on straight line basis at the rates specified in Schedule XIV of the Companies Act, 1956, as amended upto-date.

(b) Depreciation on asset purchased/acquired/installed during the year is charged from the date of such event. Similarly depreciation on assets sold/discarded during the year is charged upto the date of the event.

1.5 IMPAIRMENT

Fixed assets are reviewed at each Balance Sheet date for impairment. In case events and circumstances indicate any impairment, recoverable amount of fixed assets is determined. An impairment loss is recognized, whenever the carrying amount of the assets either belonging to the Cash Generating Unit (CGU) or otherwise, exceeds recoverable amount. The recoverable amount is the greater of the assets net selling price or its value in use. In assessing value in use, the estimated future cash flows from the use of the assets are discounted to their present value at appropriate rate. An impairment loss is reversed if there has been change in the recoverable amount and such loss either no longer exists or has decreased. Impairment loss / reversal thereof is adjusted to the carrying value of the respective assets, which in case of CGU are allocated to its assets on pro-rata basis.

1.6 INVENTORIES

(a) Inventories of raw materials, packaging materials, fuel, stores & spares are valued at lower of procurement cost and net realisable value. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined at weighted average basis.

(b) Where applicable Inventories of work-in-progress and finished goods are valued at lower of cost and net realisable value. Cost of inventories includes direct materials, labour and a portion of manufacturing overheads based on normal operating capacity.

1.7 BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets. All other borrowing costs are charged to revenue.

1.8 REVENUE RECOGNITION

Revenue from the sale of goods (including Trial Production Bottles) is recognized upon passage of title to the customers, which generally coincides with their delivery. Adjustments, if any, arising out of price difference claims, etc, are accounted for as and when they are finally determined.

1.9 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

(a) A provision is recognised when the company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimate.

(b) Contingent liabilities are disclosed by way of notes to accounts.

(c) Contingent Assets are not recognised except for the purpose of settlement of dispute/claim.

1.10 LEASE

Since no assets has been acquired under lease so far, policy concurrent with type of lease will be determined in due course.

1.11 ACCOUNTING FOR TAXES ON INCOME

In view of the loss for the year under review, Taxes on Current and Deferred Income have not arisen.

1.12 SEGMENT-WISE REPORTING

The Companys exclusive business is manufacturing and selling of IV Fluids and as such in the opinion of the Management this is the only reportable business segment as per Accounting Standard 17 , on Segment Reporting issued by The Institute of Chartered Accountants of India. There is no reportable Geographical segment either.

1.13 EMPLOYEE BENEFITS

(a) Defined contribution to provident fund and employee state insurance are charged to profit & loss account of the year when the contributions to the respective funds are due. There are no other obligations to the employees other than contribution payable to the respective statutory authorities.

(b) Minimum bonus or bonus as negotiated from time to time, whichever is higher are accounted and paid on cash basis as a matter of consistency.

(c) No other benefits are given to the employees.

(d) As a matter of consistency, retirement benefit in the form of gratuity is being considered on cash basis.

1.14 POLICY ON EARNING PER SHARE

(a) Basic earning per share is calculated by dividing the net profit or loss after tax and include post tax effect of any extra-ordinary item for the period attributable to equity shareholders by the weighted average number of equity share outstanding during the period. The weighted average number of equity shares as outstanding during the period are adjusted for events including a bonus issue, bonus element in a right issue, split of shares or reverse split (i.e. consolidation of shares) etc. made during the year.

(b) For the purpose of calculating diluted earning per share, the net profit of the period attributable to equity shareholders and the weighted number of shares outstanding during the period are adjusted for the effects of all dilutive potential of equity shares.

1.15 PROVISION FOR TAXATION

(a) Tax expense for the year, comprising current tax & deferred tax is included in determining the net profit (loss) for the year.

(b) A provision is made for the current tax based on tax liability computed in accordance with relevant tax rates and tax laws. A provision is made for deferred tax for all timing differences arising between taxable income and accounting income at currently or substantively enacted tax laws.

(c) Deferred tax assets are recognised only if there is reasonable certainty that they will be realized and are reviewed for the appropriations of their respective carrying values at each balance sheet date.

1.16 FOREIGN CURRENCY TRANSACTION

Where applicable Foreign currency transactions are accounted for at the exchange rate prevailing at the transaction date. Year and monetary assets and liabilities in foreign currency are translated at the applicable year end exchange rates and the resultant difference is recognised as gain / loss for the year.