Click it and Unblock the Notifications
Accounting Policies of Suryalata Spinning Mills Ltd. Company
Mar 31, 2024
CORPORATE INFORMATION
Suryalata Spinning Mills Limited (the âCompanyâ) is a public limited company incorporated on May 23rd,1983 and as its Registered office at 105, S P Road, Surya Towers , 1st Floor, Secunderabad, Telangana State. The Company is engaged in producing the best quality of Synthetic Yarns like 100% Polyester (PSF) Yarns, 100% Viscose (VSF) Yarns, PSF & VSF Blended Yarns and Value Added Yarns like Slub Yarns, Elite Twist and Two for One Twist Yarns (T F O) etc., suitable for suitings, shirtings and knitting. The Company has established in the domestic market as well as in the international market and sells its products through the multiple channels. The Company is listed on Bombay Stock Exchange.
The financial statements of the company for the year ended March 31st, 2024 are approved for issue by the Companyâs Board of Directors on May 23rd, 2024.
MATERIAL ACCOUNTING POLICIES AND KEY ACCOUNTING ESTIMATES AND JUDGEMENTS.
I Material Accounting Policies:
1. Statement of Compliance:
These financial statements have been prepared in accordance with the Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standard) Rules, 2015 notified under section 133 of the Companies Act 2013, amendments there to and other relevant provisions of the Act.
2. Basis of Preparation and Measurement:
These Ind AS Financial Statements have been prepared on a going concern basis using historical cost convention and on an accrual method of accounting, except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in INR which is also the Companyâs functional currency and all values are rounded to the nearest Lakhs (INR 00,000), except when otherwise indicated.
3. Classification of Assets and liabilities as Current and Non-current
The company has determined its operating cycle as 12 months for the purpose of classification of current and non-current assets and liabilities. This is based on the nature of product and the time between the acquisition of inventories for processing and their realization in cash and cash equivalents. All assets and liabilities have been classified as current or non-current as per the Companyâs normal operating cycle and other criteria set out in the Schedule III(Division II) to the Companies Act, 2013.
Deferred tax assets and deferred tax liabilities are classified as non-current assets and non-current liabilities.
4. Use of estimates & judgments:
The estimates and judgments used in the preparation of the financial statements are continuously evaluated by the Company and are based on historical experience and various other assumptions and factors (including expectations of future events) that the Company believes to be reasonable under the existing circumstances. Differences between actual results and estimates are recognized in the period in which the results are known / materialized.
5. Property, Plant and Equipment-Tangible Assets:
i. Property, plant and equipment other than land are stated at cost less accumulated depreciation and impairment losses if any. Freehold land is carried at cost of acquisition. Cost comprises of purchase price and any attributable cost of bringing the assets to its working condition for its intended use.
ii. Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost, comprising of direct costs, related incidental expenses and attributable interest.
iii. Subsequent expenditure are capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company. Costs in nature of repairs and maintenance of equipment are recognized in the Statement of Profit and Loss as and when incurred.
iv. Depreciation on Fixed Assets is provided on ascertain useful life of assets under Straight Line Method (SLM) prescribed in Schedule II of the Companies act-2013 except the assets costing ''5000 or less on which depreciation is charged @100% in the year of acquisition.
v. The Company follows the policy of charging depreciation on pro-rata basis on the assets acquired or disposed off during the year.
6. Impairment of Assets
The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment if any indication of impairment exists. An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable value being higher of value in use and fair value less cost of disposal. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognized as an expense in the Profit and Loss Account in the year in which an asset is identified as impaired.
7. Inventory:
Inventories are valued at the lower of cost and net realizable value. The cost is determined on Weighted Average basis. Cost of finished goods and work-in-process include all costs of purchases, conversion costs and other costs incurred in bringing the inventories to their present location and condition.
Raw materials, Stores, sp ares and packing materials are valued at cost on weighted average basis. Scrap is valued at net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of necessary to make sale.
8. Financial Instrument:
A financial instrument is any contract that gives rise to a financial asset of one entity and financial liability or equity instrument of another entity.
a. Financial Asset:
Initial recognition and measurement
All financial instruments are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset, purchase or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place are recognized on the trade date i.e. the date that the company commits to purchase or sell the asset.
Subsequent Measurement
For the purpose of subsequent measurement financial assets are classified as measured at:
1) Amortized Cost
2) Fair value through profit and loss (FVTPL)
3) Fair value through other comprehensive income (FVTOCI)
Financial Asset measured at amortized cost
Financial Assets held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding are measured at amortized cost using effective interest rate (EIR) method. The EIR amortization is recognized as finance income in the statement of Profit & Loss.
The company while applying above criteria has classified all the financial assets (except investments in equity shares) at amortized cost.
Financial Assets Measured at fair value through other comprehensive income
Financial assets that are held within a business model whose objective is achieved by both, selling financial assets and collecting contractual cash flows that are solely payments of principal and interest, are subsequently measured at fair value through other comprehensive income. Fair value movements are recognized in the other comprehensive income(OCI). Interest income measured using the EIR method and impairment losses, if any are recognized in the Statement of Profit and Loss. On de-recognition, cumulative gain or loss previously recognized in OCI is reclassified from the equity to â other incomeâ in the Statement of Profit and Loss.
Financial Assets at fair value through profit or loss (FVTPL)
Financial Assets are measured at fair value through Profit & Loss if it does not meet the criteria for classification as measured at amortized cost or at FVTOCI. All fair value changes are recognized in the statement of profit & loss.
De-recognition of Financial Assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the contractual rights to receive the cash flows from the asset.
Impairment of Financial Assets
In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the debt instruments, that are measured at amortized cost e.g., loans, debt securities, deposits, trade receivables and bank balance.
Expected credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive.
The management uses a provision matrix to determine the impairment loss on the portfolio of trade and other receivables. Provision matrix is based on its historically observed expected credit loss rates over the expected life of the trade receivables and is adjusted for forward looking estimates.
Expected credit loss allowance or reversal recognized during the period is recognized as income or expense, as the case may be, in the statement of profit and loss. In case of balance sheet, it is shown as reduction from the specific financial asset.
b. Financial Liabilities.
Initial recognition and measurement
Financial liabilities are recognized initially at fair value plus any transaction cost that are attributable to the acquisition of the financial liability except financial liabilities at FVTPL that are measured at fair value.
Subsequent Measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
Financial Liabilities at amortized cost
Amortized cost for financial liabilities represents amount at which financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount. All the financial liabilities of the company are subsequently measured at amortized cost using Effective Interest method.
De recognition of Financial Liabilities
A financial liability shall be derecognized when, and only when it is extinguished i.e. when the obligation specified in the contract is discharged or cancelled or expires.
9. Government Grants:
Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant will be received and the Company will comply with all attached conditions. Grants related to revenue items are presented as part of profit or loss as a reduction from related expense. The benefit of a government loan at a below market rate of interest is treated as a government grant, measured as the difference between proceeds received and the fair value of the loan based on prevailing market interest rates.
10. Foreign Currency Transactions
The functional and presentation currency of the Company is Indian Rupee. Transactions in foreign currency are accounted for at the exchange rate prevailing on the transaction date. Gains/ losses arising on settlement as also on translation of monetary items are recognized in the Statement of profit and loss.
11. Borrowing Costs
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 recognized as an expense in the period in which they are incurred.
12. Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured a regardless of when the payment made. The specific recognition criteria described below must also be met before revenue is recognized.
a. Sale of Products
Revenue from the sale of goods is recognized when significant risks and rewards of ownership have been transferred to the customer, the company no longer retain continuing managerial involvement to the degree usually associated with ownership nor has effective control over the goods sold, which is mainly upon delivery, the amount of revenue can be measured reliably and recovery of the consideration that will be derived in the sale of goods.
The Company collects Goods & Service Tax (GST) on behalf of the government and therefore, these are not economic benefits flowing to the Company. Hence these are excluded from the revenue. Revenue from export sales is recognized on the date of bill of lading, based on the terms of export.
b. Recognition of Export benefits
Export benefits entitlements in respect of incentives schemes including Duty Drawback, RoDTEP( Export Incentive), Merchandise Export Incentive Scheme (MEIS) of the Government of India are recognized in the year in which Export Sales are accounted for.
c. Interest Income
Interest on deposits with government departments, financial institutions and Loans provided to subsidiary company are recognized in statement of profit and loss when the right to receive/receivable during the period.
13. Taxes on Income
Tax expense comprises of current and deferred tax
a. Current tax
Current tax expense for the year is ascertained on the basis of assessable profits computed in accordance with the provisions of the Income Tax Act, 1961.
b. Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.
14. Dividend Distribution
Annual dividend distribution to the shareholders is recognized as a liability in the period in which the dividend is approved by the shareholders. Any interim dividend paid is recognized on approval by Board of Directors. Dividend payable and corresponding tax on dividend distribution is recognized directly in equity.
15. Employee Benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
a. Defined Contribution plans
Contribution towards Provident Fund for employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution schemes as the Company does not carry any further obligations, apart from the Contributions made on a monthly basis.
b. Defined benefit plans
Gratuity liability is defined benefit obligation and is provided on the basis of an actuarial valuation on projected unit credit method made at the end of each year. The Company funds the benefit through contributions to SBI Life.
Remeasurement of the net defined benefit liability, which comprise actuarial gains and losses and the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income (OCI). Net interest expense (income) on the net defined liability(assets) is computed by applying the discount rate, used to measure the net defined liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in Statement of Profit and Loss.
16. Provisions
Provisions are recognized when, as a result of a past event, the Company has a legal or constructive obligation; it is probable that an outflow of resources will be required to settle the obligation; and the amount can be reliably estimated. The amount so recognized is a best estimate of the consideration required to settle the obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation.
In an event when the time value of money is material, the provision is carried at the present value of the cash flows estimated to settle the obligation.
17. Contingent Liabilities
Contingent Liabilities are disclosed when there is a possible obligation arising from past events,the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.
18. Claims
Claims against the Company not acknowledged as debts are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.
19. Offsetting
Financial Assets and Financial Liabilities are offset and the net amount presented in the Balance Sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.
20. Earnings per share
The Company presents basic and diluted earnings per share (âEPSâ) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
21. Cash flow statement
Cash flows are reported using the indirect method. Where by profit for the period is adjusted for effects of transactions of a non-cash nature, any deferrals are accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the company are segregated.
22. Segment Reporting
An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the companyâs Chief Operating Decision Maker (âCODMâ) to make decisions for which discrete financial information is available. Based on the management approach as defined in Ind AS 108, the CODM evaluates the Companyâs performance and allocates resources based on an analysis of various performance indicators by business segments and geographic segments.
The operations of the company are related to one segment i.e. spinning in textiles
23. Events after Reporting date
Where events occurring after the Balance Sheet date provide evidence of conditions that existed at the end of the reporting period, the impact of such events is adjusted within the financial statements. Otherwise, events after the Balance Sheet date of material size or nature are only disclosed.
24. Recent Accounting Pronouncements
The Company applied for the first time these amendments of Ind AS 8 , Ind AS 1 and Ind AS 12 and there is no material impact on financials.
Ministry of Corporate Affairs (âMCAâ) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.
25. Critical Accounting Estimates and Judgments
The preparation of financial statements is in conformity with generally Accepted Accounting Principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period. Although these estimates are based upon managementâs best knowledge of current events and actions, actual results could differ from these estimates. Revisions in accounting estimates are recognized prospectively.
The areas involving critical estimates or judgments are â
- Estimates of Useful life of Property, plant and equipment and Tangible Assets (refer note 1.5)
- Measurement of defined benefit obligation (refer note 1.15)
- Recognition of deferred taxes (refer note 1.13)
- Estimation of impairment (refer note 1.6 and 1.8)
- Estimation of provision and contingent liabilities (refer note 1.16 and 1.17)
Mar 31, 2023
Suryalata Spinning Mills Limited (the âCompanyâ) is a public limited company incorporated on May 23rd,1983 and as its Registered office at 105, S P Road, Surya Towers , 1st Floor, Secunderabad, Telangana State. The Company is engaged in producing the best quality of Synthetic Yarns like 100% Polyester (PSF) Yarns, 100% Viscose (VSF) Yarns, PSF & VSF Blended Yarns and Value Added Yarns suitable for suitings, shirtings and knitting. The Company has established in the domestic market as well as in the international market and sells its products through the multiple channels. The Company is listed on Bombay Stock Exchange.
The financial statements of the company for the year ended March 31st, 2023 are approved for issue by the Companyâs Board of Directors on May 29th, 2023.
SIGNIFICANT ACCOUNTING POLICIES AND KEY ACCOUNTING ESTIMATES AND JUDGEMENTS.I Significant Accounting Policies:1. Statement of Compliance:
These financial statements have been prepared in accordance with the Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standard) Rules, 2015 notified under section 133 of the Companies Act 2013, amendments there to and other relevant provisions of the Act.
2. Basis of Preparation and Measurement:
These Ind AS Financial Statements have been prepared on a going concern basis using historical cost convention and on an accrual method of accounting, except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied consistently over all the periods presented in these financial statements.
The financial statements are presented in INR which is also the Companyâs functional currency and all values are rounded to the nearest Lakhs (INR 00,000), except when otherwise indicated.
3. Classification of Assets and liabilities as Current and Non-current
The company has determined its operating cycle as 12 months for the purpose of classification of current and non-current assets and liabilities. This is based on the nature of product and the time between the acquisition of inventories for processing and their realization in cash and cash equivalents. All assets and liabilities have been classified as current or non-current as per the Companyâs normal operating cycle and other criteria set out in the Schedule III(Division II) to the Companies Act, 2013.
Deferred tax assets and deferred tax liabilities are classified as non-current assets and non-current liabilities.
4. Use of estimates & judgments:
The estimates and judgments used in the preparation of the financial statements are continuously evaluated by the Company and are based on historical experience and various other assumptions and factors (including expectations of future events) that the Company believes to be reasonable under the existing circumstances. Differences between actual results and estimates are recognized in the period in which the results are known / materialized.
5. Property, Plant and Equipment-Tangible Assets:
i. Property, plant and equipment other than land are stated at cost less accumulated depreciation and impairment losses if any. Freehold land is carried at cost of acquisition. Cost comprises of purchase price and any attributable cost of bringing the assets to its working condition for its intended use.
ii. Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost, comprising of direct costs, related incidental expenses and attributable interest.
iii. Subsequent expenditure are capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company. Costs in nature of repairs and maintenance of equipment are recognized in the Statement of Profit and Loss as and when incurred.
iv. Depreciation on Fixed Assets is provided on ascertain useful life of assets under Straight Line Method (SLM) prescribed in Schedule II of the Companies act-2013 except the assets costing ''5000 or less on which depreciation is charged @100% in the year of acquisition.
â '' âââââ âââââ â ââ â â ââ â ââââ â â â â â â âââââ â â â - â- ---7 ââ â â
v. The Company follows the policy of charging depreciation on pro-rata basis on the assets acquired or disposed off during the year.
Intangible Assets are stated at cost less accumulated amortization. Cost includes any expenditure directly attributable on making the asset ready for its intended use.
Intangible assets are amortized over their useful life as estimated by the management which is about 6 years for ERP software.
The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment if any indication of impairment exists. An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable value being higher of value in use and fair value less cost of disposal. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognized as an expense in the Profit and Loss Account in the year in which an asset is identified as impaired.
The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
At the date of commencement of lease, the Company recognises a Right-of-use asset (âROUâ) and a corresponding liability for all lease arrangements in which it is a lessee, except for leases with the term of twelve months or less (short term leases) and low value leases. For short term and low value leases, the Company recognises the lease payment as an operating expense on straight line basis over the term of lease.
Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying asset. The lease liability is initially measured at amortised cost at the present value of the future lease payments. The lease payments are discounted using the interest rate explicit in the lease or, if not readily determinable, using the incremental borrowing rates in the country of domicile of these leases.
Inventories are valued at the lower of cost and net realizable value. The cost is determined on Weighted Average basis. Cost of finished goods and work-in-process include all costs of purchases, conversion costs and other costs incurred in bringing the inventories to their present location and condition.
Raw materials, Stores, spares and packing materials are valued at cost on weighted average basis. Scrap is valued at net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of necessary to make sale.
A financial instrument is any contract that gives rise to a financial asset of one entity and financial liability or equity instrument of another entity.
a. Financial Asset:
Initial recognition and measurement
All financial instruments are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset, purchase or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place are recognized on the trade date i.e. the date that the company commits to purchase or sell the asset.
Subsequent Measurement
For the purpose of subsequent measurement financial assets are classified as measured at:
1) Amortized Cost
2) Fair value through profit and loss (FVTPL)
3) Fair value through other comprehensive income (FVTOCI)
Financial Asset measured at amortized cost
Financial Assets held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding are measured at amortized cost using effective interest rate (EIR) method. The EIR amortization is recognized as finance income in the statement of Profit & Loss.
The company while applying above criteria has classified all the financial assets (except investments in equity shares) at amortized cost.
Financial Assets Measured at fair value through other comprehensive income
Financial assets that are held within a business model whose objective is achieved by both, selling financial assets and collecting contractual cash flows that are solely payments of principal and interest, are subsequently measured at fair value through other comprehensive income. Fair value movements are recognized in the other comprehensive income(OCI). Interest income measured using the EIR method and impairment losses, if any are recognized in the Statement of Profit and Loss. On de-recognition, cumulative gain or loss previously recognized in OCI is reclassified from the equity to â other incomeâ in the Statement of Profit and Loss.
Financial Assets at fair value through profit or loss (FVTPL)
Financial Assets are measured at fair value through Profit & Loss if it does not meet the criteria for classification as measured at amortized cost or at FVTOCI. All fair value changes are recognized in the statement of profit & loss.
De-recognition of Financial Assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the contractual rights to receive the cash flows from the asset.
Impairment of Financial Assets
In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the debt instruments, that are measured at amortized cost e.g., loans, debt securities, deposits, trade receivables and bank balance.
Expected credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive.
The management uses a provision matrix to determine the impairment loss on the portfolio of trade and other receivables. Provision matrix is based on its historically observed expected credit loss rates over the expected life of the trade receivables and is adjusted for forward looking estimates.
Expected credit loss allowance or reversal recognized during the period is recognized as income or expense, as the case may be, in the statement of profit and loss. In case of balance sheet, it is shown as reduction from the specific financial asset.
b. Financial Liabilities.
Initial recognition and measurement
Financial liabilities are recognized initially at fair value plus any transaction cost that are attributable to the acquisition of the financial liability except financial liabilities at FVTPL that are measured at fair value.
Subsequent Measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
Financial Liabilities at amortized cost
Amortized cost for financial liabilities represents amount at which financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount. All the financial liabilities of the company are subsequently measured at amortized cost using Effective Interest method.
De recognition of Financial Liabilities
A financial liability shall be derecognized when, and only when it is extinguished i.e. when the obligation specified in the contract is discharged or cancelled or expires.
Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant will be received and the Company will comply with all attached conditions. Grants related to revenue items are presented as part of profit or loss as a reduction from related expense. The benefit of a government loan at a below market rate of interest is treated as a government grant, measured as the difference between proceeds received and the fair value of the loan based on prevailing market interest rates.
12. Foreign Currency Transactions
The functional and presentation currency of the Company is Indian Rupee. Transactions in foreign currency are accounted for at the exchange rate prevailing on the transaction date. Gains/ losses arising on settlement as also on translation of monetary items are recognized in the Statement of profit and loss.
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 recognized as an expense in the period in which they are incurred.
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured a regardless of when the payment made. The specific recognition criteria described below must also be met before revenue is recognized.
Revenue from the sale of goods is recognized when significant risks and rewards of ownership have been transferred to the customer, the company no longer retain continuing managerial involvement to the degree usually associated with ownership nor has effective control over the goods sold, which is mainly upon delivery, the amount of revenue can be measured reliably and recovery of the consideration that will be derived in the sale of goods.
The Company collects Goods & Service Tax (GST) on behalf of the government and therefore, these are not economic benefits flowing to the Company. Hence these are excluded from the revenue. Revenue from export sales is recognized on the date of bill of lading, based on the terms of export.
b. Recognition of Export benefits
Export benefits entitlements in respect of incentives schemes including Duty Drawback, RoDTEP( Export Incentive), Merchandise Export Incentive Scheme (MEIS) of the Government of India are recognized in the year in which Export Sales are accounted for.
c. Interest Income
Interest on deposits with government departments and financial institutions are recognized in statement of profit and loss when the right to receive/receivable during the period.
Tax expense comprises of current and deferred tax
Current tax expense for the year is ascertained on the basis of assessable profits computed in accordance with the provisions of the Income Tax Act, 1961.
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.
Minimum Alternate Tax credit is recognised as deferred tax asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax during the specified period.
Annual dividend distribution to the shareholders is recognized as a liability in the period in which the dividend is approved by the shareholders. Any interim dividend paid is recognized on approval by Board of Directors. Dividend payable and corresponding tax on dividend distribution is recognized directly in equity.
Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
a. Defined Contribution plans
Contribution towards Provident Fund for employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution schemes as the Company does not carry any further obligations, apart from the Contributions made on a monthly basis.
b. Defined benefit plans
Gratuity liability is defined benefit obligation and is provided on the basis of an actuarial valuation on projected unit credit method made at the end of each year. The Company funds the benefit through contributions to SBI Life.
Remeasurement of the net defined benefit liability, which comprise actuarial gains and losses and the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income (OCI). Net interest expense (income) on the net defined liability(assets) is computed by applying the discount rate, used to measure the net defined liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in Statement of Profit and Loss.
Provisions are recognised when, as a result of a past event, the Company has a legal or constructive obligation; it is probable that an outflow of resources will be required to settle the obligation; and the amount can be reliably estimated. The amount so recognised is a best estimate of the consideration required to settle the obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation.
In an event when the time value of money is material, the provision is carried at the present value of the cash flows estimated to settle the obligation.
Contingent Liabilities are disclosed when there is a possible obligation arising from past events,the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.
Claims against the Company not acknowledged as debts are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.
Financial Assets and Financial Liabilities are offset and the net amount presented in the Balance Sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.
The Company presents basic and diluted earnings per share (âEPSâ) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
Cash flows are reported using the indirect method. Where by profit for the period is adjusted for effects of transactions of a non-cash nature, any deferrals are accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the company are segregated.
An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the companyâs Chief Operating Decision Maker (âCODMâ) to make decisions for which discrete financial information is available. Based on the management approach as defined in Ind AS 108, the CODM evaluates the Companyâs performance and allocates resources based on an analysis of various performance indicators by business segments and geographic segments.
The operations of the company are related to one segment i.e. spinning in textiles
25. Events after Reporting date
Where events occurring after the Balance Sheet date provide evidence of conditions that existed at the end of the reporting period, the impact of such events is adjusted within the financial statements. Otherwise, events after the Balance Sheet date of material size or nature are only disclosed.
26. Critical Accounting Estimates and Judgments
The preparation of financial statements is in conformity with generally Accepted Accounting Principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period. Although these estimates are based upon managementâs best knowledge of current events and actions, actual results could differ from these estimates. Revisions in accounting estimates are recognized prospectively.
The areas involving critical estimates or judgments are â
- Estimates of Useful life of Property, plant and equipment and intangible Assets (refer note 1.5 & 1.6)
- Measurement of defined benefit obligation (refer note 1.17)
- Recognition of deferred taxes (refer note 1.15)
- Estimation of impairment (refer note 1.7 and 1.10)
- Estimation of provision and contingent liabilities (refer note 1.18 and 1.19)
Mar 31, 2018
1. Significant Accounting Policies:
(1.1) Basis of Preparation of Financial Statements.
These financial statements have been prepared in accordance with the Indian Accounting Standards (Ind AS) as specified under section 133 of the Companies Act 2013 and other relevant provisions of the act.
These Ind AS Financial Statements have been prepared on a going concern basis using historical cost convention and on an accrual method of accounting, except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied constantly over all the periods presented in these financial statements.
The financial statements are presented in INR which is also the Companyâs functional currency and all values are rounded to the nearest Lakhs (INR 00,000), except when otherwise indicated.
(1.2) Classification of Assets and liabilities as Current and Non-current
The company has determined its operating cycle as 12 months for the purpose of classification of current and non-current assets and liabilities. This is based on the nature of product and the time between the acquisition of inventories for processing and their realization in cash and cash equivalents.
Deferred tax assets and deferred tax liabilities are classified as non-current assets and liabilities.
(1.3) Property, Plant and Equipment-Tangible Assets
i. Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses if any. Cost comprises of purchase price and any attributable cost of bringing the assets to its working condition for its intended use.
ii. Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost, comprising of direct costs, related incidental expenses and attributable interest.
iii. Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.
iv. Depreciation on Fixed Assets is provided on ascertain useful life of assets under Straight Line Method (SLM) prescribed in Schedule II of the Companies act-2013 except the assets costing Rs. 5000 or less on which depreciation is charged @100% in the year of acquisition.
v. The Company follows the policy of charging depreciation on pro-rata basis on the assets acquired or disposed off during the year.
vi. Transition to Ind AS:
On transition to Ind AS, the Company has selected to continue with the carrying value of all of its property, plant and equipment recognized as at April 1, 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.
(1.4) Intangible Assets
Intangible Assets are stated at cost less accumulated amortization. Cost includes any expenditure directly attributable on making the asset ready for its intended use.
Intangible assets are amortized over their useful life.
(1.5) Impairment of Assets
The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment if any indication of impairment exists. An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable value being higher of value in use and fair value less cost of disposal. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognized as an expense in the Statement of Profit and Loss in the year in which an asset is identified as impaired.
(1.6) Inventory
Inventories are valued at the lower of cost and net realizable value. The cost is determined on Weighted Average basis. Cost of finished goods and work-in-process include all costs of purchases, conversion costs and other costs incurred in bringing the inventories to their present location and condition.
Stores and packing materials are valued at cost on weighted average basis.
(1.7) Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and financial liability or equity instrument of another entity.
a. Financial Asset
Initial recognition and measurement
All financial instruments are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through Statement of Profit & Loss transaction costs that are attributable to the acquisition of the financial asset, purchase or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place are recognized on the trade date i.e. the date that the company commits to purchase or sell the asset.
Subsequent Measurement
For the purpose of subsequent measurement financial assets are classified as measured at:
1) Amortized Cost
2) Fair value through profit and loss (FVTPL)
3) Fair value through other comprehensive income (FVTOCI)
Financial Asset measured at amortized cost
Financial Assets held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding are measured at amortized cost using effective interest rate (EIR) method. The EIR amortization is recognized as finance income in the Statement of Profit & Loss.
The company while applying above criteria has classified all the financial assets (except investments in equity shares) at amortized cost.
Financial Assets Measured at fair value through other comprehensive income
Financial assets that are held within a business model whose objective is achieved by both, selling financial assets and collecting contractual cash flows that are solely payments of principal and interest, are subsequently measured at fair value through other comprehensive income. Fair value movements are recognized in the other comprehensive income(OCI). Interest income measured using the EIR method and impairment losses, if any are recognized in the Statement of Profit and Loss. On derecognition, cumulative gain or loss previously recognized in OCI is reclassified from the equity to âother incomeâ in the Statement of Profit and Loss.
Financial Assets at fair value through profit or loss (FVTPL)
Financial Asset are measured at fair value through Profit & Loss if it does not meet the criteria for classification as measured at amortized cost or at FVTOCI. All fair value changes are recognized in the Statement of Profit & Loss.
Derecognition of Financial Assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the contractual rights to receive the cash flows from the asset.
Impairment of Financial Assets
In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the debt instruments, that are measured at amortized cost e.g., loans, debt securities, deposits, trade receivables and bank balance.
Expected credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive.
The management uses a provision matrix to determine the impairment loss on the portfolio of trade and other receivables. Provision matrix is based on its historically observed expected credit loss rates over the expected life of the trade receivables and is adjusted for forward looking estimates.
Expected credit loss allowance or reversal recognized during the period is recognized as income or expense, as the case may be, in the statement of profit and loss. In case of balance sheet, it is shown as reduction from the specific financial asset.
b. Financial Liabilities.
Initial recognition and measurement
Financial liabilities are recognized initially at fair value plus any transaction cost that are attributable to the acquisition of the financial liability except financial liabilities at FVTPL that are measured at fair value.
Subsequent Measurement
Financial liabilities are subsequently measured at amortized cost using the EIR method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.
Financial Liabilities at amortized cost
Amortized cost for financial liabilities represents amount at which financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount.
All the financial liabilities of the company are subsequently measured at amortized cost using Effective Interest method.
Derecognition of Financial Liabilities
A financial liability shall be derecognized when, and only when, it is extinguished i.e. when the obligation specified in the contract is discharged or canceled or expires.
(1.8) Foreign Currency Transactions
The functional and presentation currency of the Company is Indian Rupee. Transactions in foreign currency are accounted for at the exchange rate prevailing on the transaction date. Gains/ losses arising on settlement as also on translation of monetary items are recognized in the Statement of Profit and Loss.
(1.9) Borrowing Costs
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 recognized as an expense in the period in which they are incurred.
(1.10) Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured a regardless of when the payment made. The specific recognition criteria described below must also be met before revenue is recognized.
a. Sale of Products
Revenue from the sale of goods is recognized when significant risks and rewards of ownership have been transferred to the customer, the company no longer retain continuing managerial involvement to the degree usually associated with owner ship nor has effective control over the goods sold,which is mainly upon delivery,the amount of revenue can be measured reliably and recovery of the consideration that will be derived in the sale of goods.
Revenue from Sale of goods includes excise and other duties which the Company pays as a principal but excludes amounts collected on behalf of third parties i.e GST and Sales tax. Sale of goods in respect of export sales are recognized as and when the shipment of goods taken place.
b. Recognition of Export benefits
Export benefits entitlements in respect of Incentive Schemes including Duty drawback, Merchandise export incentive scheme (MEIS), FMS and FPS of the Government of India are recognized in the year in which Export Sales are accounted for.
c. Interest Income
Interest on deposits with government departments and financial institutions are recognized in statement of profit and loss when the right to receive/receivable during the period.
(1.11) Dividend Distribution
Dividends paid (including income tax thereon) is recognized in the period in which the interim dividends are approved by the Board of Directors, or in respect of the final dividend when approved by shareholders.
(1.12) Employee Benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
a. Defined Contribution plans
Contribution towards Provident Fund for employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution schemes as the Company does not carry any further obligations, apart from the Contributions made on a monthly basis.
b. Defined benefit plans
Gratuity liability is defined benefit obligation and is provided on the basis of an actuarial valuation on projected unit credit method made at the end of each year. The Company funds the benefit through contributions to LIC.
Re measurement of the net defined benefit liability, which comprise actuarial gains and losses and the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income (OCI). Net interest expense (income) on the net defined liability(assets) is computed by applying the discount rate, used to measure the net defined liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in Statement of Profit and Loss.
(1.13) Taxes on Income
Tax expense comprises of current and deferred tax
a. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Tax Act.
b. Deferred tax is recognized in respect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.
c. Minimum Alternate Tax (MAT) paid in a year is charged to the statement of profit and loss account as current tax. The Company recognizes MAT credit available as an asset to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss account and shown as âMAT Credit Entitlementâ.
(1.14) Provisions
Provisions are recognized when, as a result of a past event, the Company has a legal or constructive obligation; it is probable that an outflow of resources will be required to settle the obligation; and the amount can be reliably estimated. The amount so recognized is a best estimate of the consideration required to settle the obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation.
In an event when the time value of money is material, the provision is carried at the present value of the cash flows estimated to settle the obligation.
(1.15) Contingent Liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.
(1.16) Claims
Claims against the Company not acknowledged as debts are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.
(1.17). Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.
(1.18) Government Grants
The Company recognizes government grants only when there is reasonable assurance that the conditions attached to them will be complied with, and the grants will be received. Government grants received in relation to assets are presented in the balance sheet by setting up the grant as deferred income. Grants related to income are deducted in reporting the related expense in the statement of profit and loss.
(1.19) Earnings per share
The Company presents basic and diluted earnings per share (âEPSâ) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
(1.20) Cash flow statement
Cash flows are reported using the indirect method. Where by profit for the period is adjusted for effects of transactions of a non-cash nature, any deferrals are accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the company are segregated.
(1.21) Segment Reporting
The operations of the company are related to one segment i.e. spinning in textiles.
(1.22) Events after Reporting date
Where events occurring after the Balance Sheet date provide evidence of conditions that existed at the end of the reporting period, the impact of such events is adjusted within the financial statements. Otherwise, events after the Balance Sheet date of material size or nature are only disclosed.
(1.23) Standards issued, but not yet effective:
The standards issued, but not effective up to the date of issuance of the companyâs financial statements are disclosed below.
Ind AS 115, Revenue from Contract with Customers:
On March 28, 2018, Ministry of Corporate Affairs has notified the Ind AS 115, Revenue from Contract with Customers. The core principal of the new standard is that revenue should be recognized when a customer obtains control of a promised good or service and thus has the ability to direct the use and obtain the benefits from the good or service in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. Further, the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entityâs contracts with customers.
The Company will adopt the standard from April 1, 2018 and the management is in the process of determining the effect on adoption of Ind AS 115.
Ind AS 21, Foreign currency transactions and advance consideration
On March 28, 2018, MCA has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Ind AS 21, Foreign currency transactions and advance consideration which clarifies the date of the transactions for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. This amendment will come into force from April 1, 2018. The company has evaluated the effect of this on the financial statements and the impact is not material.
(1.24) Critical Accounting Estimates and Judgments
The preparation of financial statements is in conformity with generally Accepted Accounting Principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period. Although these estimates are based upon managementâs best knowledge of current events and actions, actual results could differ from these estimates. Revisions in accounting estimates are recognized prospectively.
The areas involving critical estimates or judgments are â
- Estimates of Useful life of Property, plant and equipment and intangibles
- Measurement of defined benefit obligation
- Recognition of deferred taxes
- Estimation of impairment
- Estimation of provision and contingent liabilities
Mar 31, 2016
Notes Forming Part of the Financial Statements
NOTE : 24 1. Background and nature of operation:
Suryalata spinning mills limited (the "Company")has been incorporated on 23rd May,1983. The Company is engaged in the business of manufacture of Synthetic Blended Yarns. The Company is listed on Bombay Stock Exchange.
2 Significant Accounting Policies :
a) Basis of Accounting :
The Financial Statements are prepared under historical cost convention in accordance with the generally accepted accounting principles in India ("Indian GAAP") and comply with all material respects with the mandatory Accounting Standards ("AS") prescribed under section 133 of the Companies Act, 2013 ("the Act") read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended), and with the relevant provisions of the Act and pronouncements of the Institute of Chartered Accountants of India (''ICAI'') The financial statements have been prepared on accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.
b) Use of Estimates :
In preparing the Company''s financial statements in conformity with the accounting principles generally accepted in India, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in the current and future periods.
c) Fixed Assets :
Tangible Fixed Assets are stated at cost net of accumulated depreciation. Expenditure during construction period including interest on borrowings for new major projects are capitalized till the commencement of commercial production. Depreciation is provided on straight line method in accordance with the useful life prescribed under schedule II of the Companies Act 2013. Plant and Machinery depreciated on the basis of continuous process.
d) Inventories :
Raw materials & Finished goods are valued at lower of cost or realizable value. Stores and Packing materials are valued at cost on Weighted Average basis. Stock-in-process and stock-in-transit are valued at cost. Waste is valued at realizable value.
e) Investments :
Investments are stated at cost and diminution in the value which is permanent in nature has been provided for.
f) Foreign Exchange Transactions :
Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilities in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangements. Exchange differences arising on settlement of transactions and translation of monetary items are recognized as income or expense.
g) Contingent Liabilities and Provisions :
All contingent liabilities are indicated by way of a note and will be paid / provided crystallization.
h) Retirement Benefits :
Company''s contribution to Provident fund determined under the relevant statute is charged to revenue. The gratuity contribution has been made on the basis of actuarial valuation under AS15 given by SBI life insurance Company. The liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.
i) Accounting for Income Tax :
Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.
j) Deferred Income Tax :
Deferred Tax being tax on timing difference between taxable income and accounting income that originate in one year and capable of reversal in one or more subsequent years has been recognized. Deferred tax asset is recognized only if there is reasonable that it will be realized and will be reviewed for the appropriateness of its respective carrying value at each balance sheet date.
k) Revenue Recognition: i. Sales of Manufactured Goods:
Sales of goods in respect of domestic sales are recognized on dispatch of goods to customer. ''Sales'' includes , excise duty and sales tax.
Sales of goods in respect of export sales are recognized as and when the shipment of goods takes place.
ii. Recognition of Export benefits:
Export Benefits Entitlements in respect of Incentives Schemes including Duty drawback Scheme of the Government of India are recognized in the year in which Export Sales are accounted for.
h. Employee benefits : Gratuity
Consequent to the adoption of Accounting Standard on Employees Benefits (AS-15) (Revised 2005) issued by the Institute of Chartered Accountants of India, the following disclosures have been made as required by the Standard for Actuarial valuation of Gratuity.
The company has created a Trust namely SLSML Employees Gratuity Trust vide Trust deed dated 31st December, 2005 and obtained approvals from Income Tax Authorities vide letter No. CIT-III/10/GF/2005-06 dated 18.10.2006. SBI Life Insurance has been appointed for management of the Trust fund for the Benefit of the employees. The following tables summarize the components of net benefits.
i. In the opinion of the Board, the current assets and loans & advances have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.
j. The company has opted for Drawback scheme on payment of excise duty for exports by availing cenvat credit on inputs for exports under Notification no:29/2004 (CE)dated 09.07.2004 during the period 01.04.2015 to 30.04.2015, thereafter the company has opted for Drawback scheme without payment of excise duty for exports by not taking cenvat credit on inputs for exports under Notification no :30/2004 (CE) dated 09.07.2004. The company also opted for zero rate of duty by not taking cenvat credit on inputs under central excise vide Notification no :30/2004 (CE) dated 09.07.2004 for domestic sales.
k. Previous Year''s Figures have been regrouped wherever necessary to correspond with the current year''s figures. Except when otherwise stated, the figures are presented in Rupees in Lakhs.
Mar 31, 2014
A) Basis Of Preparation
The Company follows the mercantile system of accounting and recognizes
income and expenditure on accrual basis. The accounts are prepared on
historical cost convention and in accordance with the generally
accepted accounting practices.
b) Fixed Assets
Tangible Fixed Assets are stated at cost net of accumulated
depreciation. Expenditure during construction period including interest
on borrowings for new major projects are capitalized till the
commencement of commercial production. Depreciation is provided on
Straight line method as per Section 205 read with Schedule XIV of the
Companies Act, 1956. Plant and Machinery depreciated on the basis of
continuous process.
c) Inventories
Raw materials & Finished goods are valued at lower of cost or
realizable value. Stores and Packing materials are valued at cost on
Weighted Average basis. Stock-in-process and stock-in-transit are
valued at cost. Waste is valued at realizable value.
d) Investments
Investments are stated at cost and diminution in the value which is
permanent in nature has been provided for
e) Foreign Exchange Transactions
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. Monetary assets and liabilities in
foreign currency are translated at year end rate or at the rates of
exchange fixed under contractual arrangements. Exchange differences
arising on settlement of transactions and translation of monetary items
are recognized as income or expense.
f) Contingent Liabilities
No liability is provided in respect of contingent liabilities, but only
mentioned by way of note to accounts.
g) Retirement Benefits
Company''s contribution to Provident fund determined under the relevant
statute are charged to revenue. The gratuity contribution has been made
on the basis of actuarial valuation under AS15 given by SBI life
insurance Company. The liability for leave encashment is provided for
on the basis of accrued leaves at the close of the year.
h) Accounting For Income Tax
Current tax represents the amount that otherwise would have been
payable under the Income-tax Act, 1961, had the financial year been
reckoned as the basis for computation of tax payable under the
prevailing tax laws.
i) Deferred Income Tax
Deferred Tax being tax on timing difference between taxable income and
accounting income that originate in one year and capable of reversal in
one or more subsequent years has been recognized. Deferred tax asset
is recognized only if there is reasonable that it will be realized and
will be reviewed for the appropriateness of its respective carrying
value at each balance sheet date.
j) Sales
Sales represent the amount realised or realisable for goods sold
including freight, excise duty, cess and sales tax thereon.
Mar 31, 2013
A) Basis Of Preparation
The Company follows the mercantile system of accounting and recognizes
income and expenditure on accrual basis. The accounts are prepared on
historical cost convention and in accordance with the generally
accepted accounting practices.
b) Fixed Assets
Tangible Fixed Assets are stated at cost net of accumulated
depreciation. Expenditure during construction period including interest
on borrowings for new major projects are capitalized till the
commencement of commercial production. Depreciation is provided on
Straight line method as per Section 205 read with Schedule XIV of the
Companies Act, 1956. Plant and Machinery depreciated on the basis of
continuous process.
c) Inventories
Raw materials & Finished goods are valued at lower of cost or
realizable value. Stores and Packing materials are valued at cost on
Weighted Average basis. Stock-in-process and stock- in-transit are
valued at cost. Waste is valued at realizable value.
d) Investments
Investments are stated at cost and diminution in the value which is
permanent in nature has been provided for
e) Foreign Exchange Transactions
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. Monetary assets and liabilities in
foreign currency are translated at year end rate or at the rates of
exchange fixed under contractual arrangements. Exchange differences
arising on settlement of transactions and translation of monetary items
are recognized as income or expense.
f) Contingent Liabilities
No liability is provided in respect of contingent liabilities, but only
mentioned by way of note to accounts.
g) Retirement Benefits
Company''s contribution to Provident fund determined under the relevant
statute are charged to revenue. The gratuity contribution has been made
on the basis of actuarial valuation under AS15 given by SBI life
insurance Company. The liability for leave encashment is provided for
on the basis of accrued leaves at the close of the year.
h) Accounting For Income Tax
Current tax represents the amount that otherwise would have been
payable under the Income- tax Act, 1961, had the financial year been
reckoned as the basis for computation of tax payable under the
prevailing tax laws.
i) Deferred Income Tax
Deferred Tax being tax on timing difference between taxable income and
accounting income that originate in one year and capable of reversal in
one or more subsequent years has been recognized. Deferred tax asset is
recognized only if there is reasonable that it will be realized and
will be reviewed for the appropriateness of its respective carrying
value at each balance sheet date.
j) Sales
Sales represent the amount realised or realisable for goods sold
including freight, excise duty, cess and sales tax thereon.
h. Employee benefits : Gratuity
Consequent to the adoption of Accounting Standard on Employees Benefits
(AS-15) (Revised 2005) issued by the Institute of Chartered Accountants
of India, the following disclosures have been made as required by the
Standard for Actuarial valuation of Gratuity.
The company has created a Trust namely SLSML Employees Gratuity Trust
vide Trust deed dated 31st December, 2005 and obtained approvals from
Income Tax Authorities vide letter No. CIT-III/10/GF/2005-06 dated
18.10.2006. SBI Life Insurance has been appointed for management of the
Trust fund for the Benefit of the employees. The following tables
summarize the components of net benefits.
i. In the opinion of the Board, the current assets and loans & advances
have a value on realisation in the ordinary course of business at least
equal to the amount at which they are stated.
j. The company has opted for Drawback scheme on payment of excise duty
for exports by availing cenvat credit on inputs for exports under
Notification no :29/2004 (CE) dated 09.07.2004. The company has opted
for zero rate of duty by not taking cenvat credit on inputs under
central excise vide Notification no: 30/2004 (CE) dated 09.07.2004 for
domestic sales other than milenge yarn. The product of Milenge yarn
cleared on payment of excise duty by avail cenvat credit on inputs
during the period from 01.04.2012 to 28.02.2013 and opted for zero rate
of duty by not taking cenvat credit from 01.03.2013 due to zero rate of
duty made on fabric in the Budget presented on 28.02.2013.
Mar 31, 2012
A) Basis Of Preparation
The Company follows the mercantile system of accounting and recognizes
income and expenditure on accrual basis. The accounts are prepared on
historical cost convention and in accordance with the generally
accepted accounting practices.
b) Fixed Assets
Tangible Fixed Assets are stated at cost net of accumulated
depreciation. Expenditure during construction period including interest
on borrowings for new major projects are capitalized till the
commencement of commercial production. Depreciation is provided on
Straight line method as per Section 205 read with Schedule XIV of the
Companies Act, 1956. Plant and Machinery depreciated on the basis of
continuous process.
c) Inventories
Raw materials & Finished goods are valued at lower of cost or
realizable value. Stores and Packing materials are valued at cost on
Weighted Average basis. Stock-in-process and stock-in-transit are
valued at cost. Waste is valued at realizable value.
d) Investments
Investments are stated at cost and diminution in the value which is
permanent in nature has been provided for
e) Foreign Exchange Transactions
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. Monetary assets and liabilities in
foreign currency are translated at year end rate or at the rates of
exchange fixed under contractual arrangements. Exchange differences
arising on settlement of transactions and translation of monetary items
are recognized as income or expense.
f) Contingent Liabilities
No liability is provided in respect of contingent liabilities, but only
mentioned by way of note to accounts.
g) Retirement Benefits
Company's contribution to Provident fund determined under the relevant
statute are charged to revenue. The gratuity contribution has been made
on the basis of actuarial valuation under AS15 given by SBI life
insurance Company.
The liability for leave encashment is provided for on the basis of
accrued leaves at the close of the year.
h) Accounting For Income Tax
Current tax represents the amount that otherwise would have been
payable under the Income-tax Act, 1961, had the financial year been
reckoned as the basis for computation of tax payable under the
prevailing tax laws.
i) Deferred Income Tax
Deferred Tax being tax on timing difference between taxable income and
accounting income that originate in one year and capable of reversal in
one or more subsequent years has been recognized. Deferred tax asset
is recognized only if there is reasonable that it will be realized and
will be reviewed for the appropriateness of its respective carrying
value at each balance sheet date.
j) Sales
Sales represent the amount realised or realisable for goods sold
including freight, excise duty, cess and sales tax thereon.
Mar 31, 2011
BASIS OF PREPARATION :
The Company follows the mercantile system of accounting and recognizes
income and expenditure on accrual basis. The accounts are prepared on
historical cost convention and in accordance with the generally
accepted accounting practices.
FIXED ASSETS :
Tangible Fixed Assets are stated at cost net of accumulated
depreciation. Expenditure during construction period including interest
on borrowings for new major projects are capitalized till the
commencement of commercial production. Depreciation is provided on
Straight line method as per Section 205 read with Schedule XIV of the
Companies Act, 1956. Plant and Machinery depreciated on the basis of
continuous process.
INVENTORIES :
Raw materials & Finished goods are valued at lower of cost or
realizable value. Stores and Packing materials are valued at cost on
Weighted Average basis. Stock-in-process and stock-in-transit are
valued at cost. Waste is valued at realizable value.
INVESTMENTS :
Investments are stated at cost and diminution in the value which is
permanent in nature has been provided.
DERIVATIVE INSTRUMENTS :
The company uses derivative financial instruments such as Principal
only swaps for the purposes of cost reduction. In case of loss, the
transactions having protection are taken as contingent liability and
where protection is knocked in has been written off to profit and loss
account.
FOREIGN EXCHANGE TRANSACTIONS :
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. Monetary assets and liabilities in
foreign currency are translated at year end rate or at the rates of
exchange fixed under contractual arrangements. Exchange differences
arising on settlement of transactions and translation of monetary items
are recognized as income or expense.
CONTINGENT LIABILITIES :
No liability is provided in respect of contingent liabilities, but only
mentioned by way of note to accounts.
RETIREMENT BENEFITS :
Company's contribution to Provident fund determined under the relevant
statute and charged to revenue. The gratuity contribution has been
made on the basis of actuarial valuation under AS15 given by SBI life
insurance Company.
The liability for leave encashment is provided for on the basis of
accrued leaves at the close of the year.
ACCOUNTING FOR INCOME TAX :
Current tax represents the amount that otherwise would have been
payable under the Income-tax Act, 1961, had the financial year been
reckoned as the basis for computation of tax payable under the
prevailing tax laws.
DEFERRED INCOME TAX:
Deferred Tax being tax on timing difference between taxable income and
accounting income that originate in one year and capable of reversal in
one or more subsequent years has been recognized. Deferred tax asset
is recognized only if there is reasonable that it will be realized and
will be reviewed for the appropriateness of its respective carrying
value at each balance sheet date.
SALES:
Sales represent the amount realised or realisable for goods sold
including freight, excise duty, cess and sales tax thereon.
MISCELLANEOUS EXPENDITURE :
Share issue expenditure is amortised over a period of ten years in
equal installments.
Mar 31, 2010
BASIS OF PREPARATION :
The Company follows the mercantile system of accounting and recognizes
income and expenditure on accrual basis. The accounts are prepared on
historical cost convention and in accordance with the generally
accepted accounting practices.
FIXED ASSETS :
Tangible Fixed Assets are stated at cost net of accumulated
depreciation. Expenditure during construction period including interest
on borrowings for new major projects are capitalized till the
commencement of commercial production. Depreciation is provided on
Straight line method as per Section 205 read with Schedule XIV of the
Companies Act, 1956. Plant and Machinery depreciated on the basis of
continuous process.
INVENTORIES :
Raw materials, Stores and Packing materials are valued at cost on
Weighted Average basis. Stock-in- process and stock-in-transit are
valued at cost. Finished goods are valued at lower of cost or
realizable value. Waste is valued at realizable value.
INVESTMENTS :
Investments are stated at cost and diminution in the value which is
permanent in nature has been provided.
DERIVATIVE INSTRUMENTS :
The company uses derivative financial instruments such as Principal
only swaps for the purposes of cost reduction. In case of loss, the
transactions having protection are taken as contingent liability and
where protection is knocked in has been written off to profit and loss
account.
FOREIGN EXCHANGE TRANSACTIONS :
Foreign currency transactions are recorded at the rates prevailing on
the date of the transactions. Monetary assets and liabilities in
foreign currency are translated at year end rate or at the rates of
exchange fixed under contractual arrangements. Exchange differences
arising on settlement of transactions and translation of monetary items
are recognized as income or expense.
CONTINGENT LIABILITIES :
No liability is provided in respect of contingent liabilities, but only
mentioned by way of note to accounts.
RETIREMENT BENEFITS :
Companys contribution to Provident Fund determined under the relevant
statute and charged to revenue. The gratuity contribution has been
made on the basis of actuarial valuation under Accounting Standard -15
given by SBI life insurance Company.
The liability for leave encashment is provided for on the basis of
accrued leaves at the close of the year.
ACCOUNTING FOR INCOME TAX :
Current tax represents the amount that otherwise would have been
payable under the Income-tax Act, 1961, had the financial year been
reckoned as the basis for computation of tax payable under the
prevailing tax laws.
DEFERRED INCOME TAX :
Deferred Tax being tax on timing difference between taxable income and
accounting income that originate in one year and capable of reversal in
one or more subsequent years has been recognized. Deferred tax asset
is recognized only if there is reasonable that it will be realized and
will be reviewed for the appropriateness of its respective carrying
value at each balance sheet date.
SALES :
Sales represent the amount realised or realisable for goods sold
including freight, excise duty, cess and sales tax thereon.
MISCELLANEOUS EXPENDITRE :
Share issue expenditure is amortised over a period of ten years in
equal installments.
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article
More Information on Suryalata Spinning Mills Ltd.
-
Suryalata Spinning Mills Ltd. Tools
- Bulk Deals
-
Suryalata Spinning Mills Ltd. Company Details
- Company Profile
- Company History
- Management Team
- Capital Structure
- Product Mix
- Banker/Auditor/Registrar
-
Company History
- Rights
- BSE Price History
-
Suryalata Spinning Mills Ltd. Key Financial Ratios
- Ratios
-
Suryalata Spinning Mills Ltd. Results
- Quarterly Results
- Half Yearly Results
- Nine Months Results
- Annual Results
-
Suryalata Spinning Mills Ltd. Financial Data
- Audited Results
- Cash Flow
- Balance Sheet
-
Suryalata Spinning Mills Ltd. Reports
- Accounting Policies
- Auditors Report
- Directors Report
- Notes To Account
-
Suryalata Spinning Mills Ltd. Corporate Announcements
- Book Closure
- Dividend
- Board Meetings
-
Stocks To Buy Today, Dec 19: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Friday -
Stocks To Buy Today, Dec 18: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday -
Stocks To Buy Today, Dec 17: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Wednesday -
Stocks To Buy Today, Dec 16: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday -
India Stock Market Weekly Review: Nifty and Sensex Fall as Caution Spreads -
Stocks To Buy Today, Dec 15: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday
-
Stocks To Buy Today, Dec 12: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Friday -
Market Outlook 2026: Kotak Securities Sees Nifty 50 at 30,000; THESE 4 Sectors Lead Rally, Gold To Stay Strong -
Stocks To Buy Today, Dec 10: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Wednesday -
D-Street Bleeds For 2nd Day! Sensex Slumps 678 Pts; Nifty Cracks 25,800; Why Stock Market Is Falling Today? -
Stocks To Buy Today, Dec 9: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday -
Stocks To Buy Today, Dec 8: Top 4 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday -
Stock Market Alert! Major Pre-Open Session Change From Dec 8: Full Timings, Rules & All You Need To Know -
Bank Nifty Surges: RBI’s 25 bps Rate Cut Triggers Strong Upside in Major Banking Stocks -
Closing Bell: Sensex Ends 158 pts Higher, Nifty Climbs Above 26,000; Hero MotoCorp, HAL Up 2% Each -
Stocks To Buy Today, Dec 4: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday
-
Block for 8 hours
-
Block for 12 hours
-
Block for 24 hours
-
Don't block
Sign in with Google- Male
- Female
- Others
- Under 18
- 18 to 25
- 26 to 35
- 36 to 45
- 45 to 55
- 55+