Note: 1 : Corporate Information & Significant Accounting Policies
(A) Corporate Information
The Company having CIN : L26102WB1972PLC028352 was incorporated in the State of West Bengal in India on 12th of May, 1972 and commenced its business immediately thereafter. In terms of its main object, the company is engaged in Manufacturing and Exporting of Insulation Products and is a Service provider.
(B) Significant Accounting Policies
i) Convention
The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles (GAAP) in India, based on the fundamental assumptions of going concern, consistency and accrual, to comply with the Accounting Standards in accordance with Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
ii) Basis of Accounting
The financial statements have been compiled on accrual basis and in accordance with the historical cost convention.
iii) Use of Estimates
The financial statements require that the management makes estimates and assumptions that affect the reported amounts of income and expenses of the financial period, and the balances of assets and liabilities and the disclosures relating to contingent liabilities as on the date of finalization of the financial statements. Estimates and underlying assumtions are reviewed on an ongoing basis. Any revision to accounting estimates are recognized in the financial period in which such variances materialize or are discovered.
iv) Property, Plant & Equipment
Tangible fixed assets are stated at cost of acquisition, net of GST Input where applicable, and inclusive of inward freight, other duties and taxes and incidental expenses related to acquisition, less accumulated depreciation and impairment loss, if any. Expenditure with respect to cost of financing upto trial run (net of revenue) are capitalized.
Intangible assets are stated at cost of acquisition less accumulated amortisation and impairment losses.
v) Depreciation
Depreciation on fixed assets is calculated in a manner that amortizes the cost of assets after commissioning over their estimated economic lives or lives as specified in Schedule-II of the Companies Act, 2013 by the written down value method. Capital Assets located at the leasehold land, whose ownership does not vest with the company are depreciated over their useful life.
Depreciation on intangible assets, including computer software, is calculated in a manner that amortizes the cost over an estimated useful economic life of 3 years from the date of acquisition by the written down value method in keeping with the methodology laid down in Schedule II of the Companies Act, 2013.
vi) Impairment of assets
An asset is considered to be impaired if the carrying amount of the asset exceeds its recoverable amount. Impaired assets are identified at the end of each year and the amount of carrying cost in excess of the recoverable amount is recognized as impairment loss, which is disclosed separately in the Profit & Loss Account. In the event of the actual recoverable amount being in excess of the estimates on which the calculations were based, the impairment losses are reversed in the Profit & Loss Account. Disclosures as required by AS-28 are made in the notes accompanying the account for such adjustments.
vii) Investments
Current Investments are carried foreward at lower of cost or net realisable value. Long term Investments are stated at cost. Provision for diminution in value of long term investments is made only if it is decline in nature.
viii) Inventories
Raw Materials, Stores and Packing materials are valued at lower of cost and net realizable value, including necessary provision for obsolescence. Finished goods and goods in process are valued on the basis of cost of input plus manufacturing overhead upto the stage of completion of Product.
ix) Deferred Revenue Expenditure
The Company has introduced a policy to amortize 1 / 5 th of the expenses in the related statement of Profit and Loss account in case of the expenditure where the benefits are available in the future years also.
x) Income Recognition
All incomes, which can be determined with reasonable certainty and are collectible in nature, are considered as the revenue for the year on accrual basis.
Revenue from sale of products are disclosed net of GST and revenue from sale of services are disclosed net of GST.
Income is the total amount received/receivable by the Company for services provided including reimbursements of expenses incurred on behalf of clients and excluding taxes and discounts, if any.
Other incomes including interest from banks are considered on accrual basis.
xi) Purchases
Purchases are disclosed at gross value and GST input is taken where law permits. In case of blocked input , this is charged to Revenue expenses under the head “Duties and Taxation”.
xii) Employee benefits
Employee benefits are accounted for in accordance with AS-15 issued by the ICAI except Leave encashment.
In accordance with Indian regulations, employees of the company are entiltled to receive benefits under the Employees’ Provident Fund Act, 1952, and Employees’ State Insurance Act, 1948, provided their emoluments are within the scope and limits of the aforesaid enactments. At present, all of the employees are eligible to the benefits in accordance with the law.
The provision for performance incentive payable to employees are based on management’s perceptions and internal asssessment of the employees on respective projects or jobs or roles in which such employees are engaged.
xiii) Borrowing cost
Borrowing cost are attributable to acquisition and construction of assets are capitalised as part of cost of such assets upto the date when such assets are ready for intended use and other borrowing cost are charged to statement of profit and loss account.
xiv) Accounting for Taxes
Current income tax expense comprises taxes on income from operations in accordance with the provisions of the Income Tax Act, 1961. Deferred Tax resulting from timing difference between taxable and accounting income is accounted for using the tax rates and laws that are enacted. The carrying amount of deferred tax is reviewed at the end of each reporting period. Deferred Tax liabilities and assets are measured at the tax rates enacted by the end of the reporting period.
Minimum Alternate Tax (MAT), where applicable, paid in accordance to the tax laws, which give rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax during the specified period and it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably.
xv) Contingent Liabilities and assets
All liabilities having a reasonable prospect of maturing and known up to a cut-off date are provided for in the financial statements. Other claims against the Company not acknowledged as debt are disclosed after a careful evaluation of the facts and legal aspects of the matter involved by way of a note and are not recognised for accounting or taxation purposes.Contingent assets, if any, are neither recognized nor disclosed.
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