NOTES to the Financial Statements 1 significant ACCOUNTING POLICIES: 1.1 Basis of brparation of Financial Statement The financial statements are brpared under the historical cost convention in accordance with the Generally Accepted Accounting Principles in India and the provisions of the Compaies Act, 2013. 1.2 Use of Estimates The brparation of financial statements 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 amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known/ materialised. 1.3 Tangible and Intangible Fixed Assets (i) Tangible and fixed assets are stated at cost of acquisition and subsequent inmpovement there to;less accumulated debrciation, and impairment loss, if any. (ii) All cost, including financing costs freight, duties, taxes and incidental expenses related to the acqisition and installation of fixed assets. (iii) Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortisation and impairment loss, if any. 1.4 Debrciation/Amortisation (i) Debrciation on tangible assets is provided on the basis of useful life of the assets and in the manner brscribed in the Schedule II to the Companies Act, 2013. (ii) Assets costing Rs. 5000 or less are being fully debrciated in the year of acquisition. (iii) Cost of leasehold land is amortized over the period of lease. (iv) The intangible assets are amortized over the useful economic life of the respective assets. 1.5 Government Grants Grants received/to be received, if any, against specified fixed assets is/will be adjusted to the cost of the assets and in case where it is not against any specific fixed asset, the same is/will be taken as Capital Reserve. Further, the revenue grants are/will be recognised in the Statement of Profit and Loss in accordance with the related scheme and in the period in which it is/will be admitted. 1.6 Foreign Currency Transactions During the period under review there was no foreign exchange earnings or out flow. 1.7 Own Fixed Assets Fixed Assets are stated at cost net of recoverable taxes less accumulated debrciation and impairment loss, if any. 1.8 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 recognised in prior accounting period is increased/ reversed if there has been change in the estimate of recoverable value. The recoverable value is the higher of the asset's net selling price and value in use. 1.9 Investments Current Investments are carried at lower of cost and market value computed Investment wise. Long Term Investments are stated at cost or fair value as required under order of the High Court. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management. 1.10 Borrowing Cost Borrowing costs for working capital and motor car purchased are recognised as expense in the year in which they are incurred. 1.11 Revenue Recognition Revenue is recognised only when it can be reliably measured and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods adjusted for discounts (net), Value Added Tax (VAT) and gain / loss on corresponding hedge contracts. Interest income on investment is recognised on time proportion basis. Dividend is considered when right to receive is established. 1.12 Derivative Instruments All forward contracts entered to hedge on unexecuted firm commitments and highly probable forecast transactions, are recognized in the financial statements at fair value at each reporting date, in pursuance of the announcement of The Institute of Chartered Accountants of India (ICAI) on Accounting for Derivatives. 1.13 Insurance Claims These are accounted as and when admitted/settled. 1.14 Taxes on Income and Deferred Tax Provision for Income Tax is made on the basis of taxable income for the year at current rates. Tax expense comprises of Current Tax and Deferred Tax at the applicable enacted or substantively enacted rates. Current Tax rebrsents the amount of Income Tax payable/ recoverable in respect of the taxable income/ loss for the reporting period. Deferred Tax rebrsents the effect of timing difference between taxable income and accounting income for the reporting period that originate in one period and are capable of reversal in one or more subsequent periods. The Deferred Tax Asset is recognised and carried forward only to the extent that there is a reasonable certainty that the assets will be realised in future. However, where there is unabsorbed debrciation or carried forward loss under taxation laws, Deferred Tax Assets are recognised only if there is virtual certainty of realisation of assets.. 1.15 Inventories Items of inventories are measured at lower of cost or net realisable value after providing for obsolescence, if any. Cost of inventories comprises of cost of purchase, cost of purchase and other costs incurred in bringing them to their respective brsent location and condition. Cost of trading and other products are determined on weighted average basis. 1.16 Employee Benefits Short term employee benefits All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. These benefits include compensated absences such as paid annual leave and sickness leave. The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period. Long term employee benefits Defined benefit plans Provident Fund The company is not liable to pay provident fund and not providing any long term benefit to its employees. 1.17 Provisions, Contingent Liabilities and Contingent Assets Provisions involving substantial degree of estimation in measurement are recognised when there is a brsent obligation as a result of past events and it is probable that there will be an outflow of resources. A disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a brsent obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. Contingent assets are neither recognised nor disclosed in the Financial Statements. The Notes on account referred to above form an integral part of Balance Sheet. As per our report of even date attached. ForManish Mahavir & Co. Chartered Accountants (Manish Jain) Proprietor Membership No. 059264 On behalf of the Board Suresh Kumar Jain Managing Director Navin Jain Director Puja Jain Company Secretary Place : Kolkata Dated : May 14,2015 |