SIGNIFICANT ACCOUNTING POLICIES:
The Financial Statements have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the ‘Ind AS’) as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2023. The accounting policies are applied consistently to all the periods presented in the financial statements. All assets and liabilities have been classified as current or non-current as per the Group normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. The Company follows the Mercantile System of accounting and recognizes income and expenditure on accrual basis. The significant accounting policies are as follows:
i) Use of Estimation:
The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods..
ii) Property Plant and Equipments:
Fixed assets are stated at cost of acquisition less accumulated depreciation as per Ind AS 16 “Property Plant and Equipments”
iii) Depreciation:
The Company provides Depreciation on Fixed Assets every quarter on a pro-rata basis using Straight Line Method in the manner specified in Part C Schedule II of the Companies Act, 2013..
iv) Revenue:
Sales/Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer and is stated net of trade discounts, returns and GST as per Ind AS 18 (Revenue). The Company collects Goods & Service Taxes on behalf of the government and, therefore, these are not economic benefits flowing to the Company. Hence, they are excluded from revenue.
v) Inventories:
Inventories are valued at the lower of cost and net realisable value as specified in Ind AS 2 (Inventories). Since the Company Cost is computed on a weighted average basis. The net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and estimated costs necessary to make the sale..
vi) Borrowing Costs:
As per Ind AS 23 (Borrowing costs) Borrowing costs are interest and other costs that an entity incurs in connection with the borrowing of funds. During the year under consideration the company has obtained short-term borrowing for immediate business requirement
vii) Retirement and other Employee benefits
A) Gratuity: Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years. Termination includes Superannuation, Retirement or resignation, death or disablement due to accident or disease. Gratuity Amount payable is calculated as per provision of Payment of Gratuity Act, 1972
B) Provident Fund: The Employees contribution to Provident fund is deducted by the company as per provisions of employees provident fund and miscellaneous provisions act 1952
C) Employees State Insurance: During the year under consideration the Company has deducted and deposited ESIC amount in accordance with Employees’ State Insurance Act, 1948.
viii) Income taxes
Provision for current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing at the time of preparation of Financial Statement.
ix) Investments:
The Company records investments are cost or Fair Market Value whichever is lower
x) Earnings per share
Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the period. As per para 28 of Ind AS 33 (Earning per share) In case of a bonus issue or a share split, equity shares are issued to existing shareholders for no additional consideration. Therefore, the number of equity shares outstanding is increased without an increase in resources. The number of equity shares outstanding before the event is adjusted for the proportionate change in the number of equity shares outstanding as if the event had occurred at the beginning of the earliest period reported. if any.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of Shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.
xi) Cash & cash equivalent.
Cash and cash equivalents in the cash flow statement comprise Bank balance, cash in hand, cheque in hand and short-term investments with an original maturity of three months or less.
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