SIGNIFICANT ACCOUNTING POLICIES
A. Basis of Preparation of Financial Statements
The financial statements are prepared under the historical cost convention and on
accrual basis.
B. Fixed Assets :
i) Fixed assets are stated at cost, alongwith costs directly attributable to bring the
asset to their working condition. The MODVAT credit available on fixed assets in
respect of Kraft upgradation Plant was deducted from cost of the respective asset.
Fixed Assets acquired for Power Project and for upgradation of existing plant, are
stated at cost inclusive of excise duty. The company has disposed off a substantial
part of its fixed Assets as these were obsolete. This will impact its production
capacity.
ii) Depreciation has been provided in the manner and at the rates calculated as per
remaining useful life of tangible assets, as stipulated in the Schedule II of the
Companies Act, 2013, on straight line method.
C. Inventories :
^Inventories comprising of raw materials, chemicals, packing materials, goods in
process and finished products have been valued at lower of cost or net realisable
value. The consumables have been valued at cost.
ii) Inventories comprising of work-in-progress for land development project, is valued
at cost.
D. Deferred tax Liability :
No Provision has been made in respect of Deferred Tax Asset calculated as per Ind
AS 22, of about Rs.319157 hundreds (Last year Rs.325030 hundreds), arising due to
timing differences in the depreciation charged under the Income-tax Act, 1961 and
that charged under the Companies Act, 1956, and unabsorbed loss brought forward,
in view of the profitability trends, the amount of Unabsorbed Depreciation available
and the liability of the company for payment of Income tax in near future.
E. Revenue Recognition:
Revenue is recognized only when it can be reliably measured and it is reasonable to
expect ultimate collection.
F Segment Reporting:
The company has commenced business of Real Estate Development along with
manufacture of papers, Segment wise separate reporting is done.
G. The company has obtained permission from concerned Authorities for change of use
of its factory land, for Residential purpose with a plan for layout of plots and paid
necessary development fees and has also obtained registration with Maharashtra
Real Estate Regulatory Authority (RERA) for that purpose. Considering this the
company has converted its factory land into stock-in trade. Expenses incurred on
development along with cost of land are shown as work-in-progress under
Inventories. Further, the Company had entered in to Memorandum of Understanding
(MOU) with a few buyers, in earlier years to whom these plots have been allotted in
pursuant to these MOU. Amounts received or adjusted against sale of these plots are
considered as sales. No sale Deeds have been executed for sale of these plots.
Balance amounts receivable against sale consideration of these plots, will be
considered as sales on execution of Sale Deeds. No sales of these plots have been
made during the year.
H Borrowing Cost :
Borrowing costs that are attributable to the acquisition or construction of qualifying
assets are capitalized as part of the cost of such assets. A qualifying asset is one that
necessarily takes substantial period of time to get ready for its intended use. All other
borrowing costs are charged to Profit and Loss account.
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