Accounting Policies of Swasti Vinayaka Synthetics Ltd. Company

Mar 31, 2024

2. Significant Accounting Policies

1. Basis of preparation of Financial Statements

a) These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS), notified under section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015, under the historical cost convention on accrual basis.

The financial statements up to year ended March 31,2024 were prepared in accordance with the accounting standards notified under Companies (Accounting Standard) Rules, 2014 and other relevant provisions of the Act (“Previous GAAP”).

These financial statements are the first financial statements of the Company under Ind AS. Refer note Y related to First-time Adoption of Ind AS for an explanation of how the transition from previous GAAP to Ind AS has affected the Company‘s financial position, financial performance and cash flows.

b) All the assets and liabilities has been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle to be twelve months for the purpose of current - non-current classification of assets and liabilities.

c) Accounting policies not specifically referred to otherwise are consistent with the generally accepted accounting principles followed by the Company.

2. Property, Plant and Equipment and Depreciation

A) Property Plant and Equipment:

a) Freehold land is carried at historical cost. All other Tangible Fixed assets are stated at cost of acquisition or construction, less accumulated depreciation. All costs, including borrowing cost till respective assets is put to use, are capitalized.

b) Intangible assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any.

c) Transition to Ind AS,

On transition to Ind AS, the Company has opted to continue with the carrying value of all of its property, plant and equipment recognized as at April 01, 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment on the transition date.

B) Depreciation:

Depreciation has been provided as under:

(i) For assets existing on 1^st April 2014 the carrying amount will be amortized over the remaining useful lives on straight line method as prescribed in the schedule II of Companies Act, 2013.

(ii) For the assets added after the 1^st April 2014 :- On straight line method at the useful Lives prescribed in Schedule II to The Companies Act, 2013.

(iii) Depreciation on assets added/ disposed off during the year has been provided on pro-rata basis with reference to the days of addition/ disposal.

(iv) The residual values are not more than 5% of the original cost of the asset

3. Foreign Exchange Transaction

(i) Functional currency and presentation currency :

The functional currency of the Company is the Indian rupee. These financial statements are presented in Indian rupees, which is the Company’s functional and presentation currency.

(ii) Transactions and balances :

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the time of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions is recognized in statement of profit or loss.

At the reporting date, non-monetary items which are carried in terms of historical cost denominated in foreign currency are reported using the exchange rate at the date of transaction.

4. Investments

Investments that are readily realizable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All the other investments are classified as long-term investments. Current investments and Long Term Investments are carried at fair value at the Balance sheet date.

Transition to Ind AS :

(a) Investments :

Upon first time adoption of Ind AS, the Company has opted to value at fair Price to all of its investments as at April 1,2016 and use that carrying value as the deemed cost of such other investment on the transition date. The resulting gain or loss arising from such a transition is added to retained earnings in balance sheet as on the April 1,2016.

5. Inventories

Inventories are stated at lower of cost and net realizable value.

Cost of raw materials is determined using FIFO method. However, these items are considered to be realizable at cost if the finished products, in which they will be used, are expected to be sold at or above cost.

The cost of finished goods and Stock-in-process comprises raw materials, direct labour, other direct costs and related production overheads upto the relevant stage of completion.

Waste material are valued at Net Realizable value, if any.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.

6. Recognition of Income & Expenditure

(i) Revenue/ Incomes and Costs/ Expenditure are generally accounted on accrual, as they are earned or incurred.

(ii) a) Sale of Goods is recognized on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods. b) Sales of goods are accounted excluding taxes, wherever applicable.

(iii) Interest Income/ expenditure is recognized on the time proportion basis taking into account of the amount outstanding and the rate applicable.

(iii) Dividend income is recognized when the right to received dividend is established.

7. Customs Duty

Custom Duty is accounted for as and when paid on the clearance of the goods for home Consumption.

8. Employees Retirement and other benefits

a) Provident fund:-

The contribution of the Company on a monthly basis towards Provident Fund and Employee State Insurance, which are, defined contributions plans are charged to revenue. The company has paid to regulatory authority & has no further obligations other than these contributions.

b) Leave Encashment:-

The Company recognises and pays Leave Encashment on a quarterly basis to all Employees.

c) Gratuity:-

The company recognises and pays Gratuity on cash basis to the employees i.e. on Retirement, resignation, termination of employees.

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Mar 31, 2023

2. Significant Accounting Policies

1. Basis of preparation of Financial Statements

a) These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS), notified under section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015, under the historical cost convention on accrual basis.

The financial statements up to year ended March 31,2023 were prepared in accordance with the accounting standards notified under Companies (Accounting Standard) Rules, 2014 and other relevant provisions of the Act (“Previous GAAP”).

These financial statements are the first financial statements of the Company under Ind AS. Refer note Y related to First-time Adoption of Ind AS for an explanation of how the transition from previous GAAP to Ind AS has affected the Company‘s financial position, financial performance and cash flows.

b) All the assets and liabilities has been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle to be twelve months for the purpose of current - non-current classification of assets and liabilities.

c) Accounting policies not specifically referred to otherwise are consistent with the generally accepted accounting principles followed by the Company.

2. Property, Plant and Equipment and Depreciation

A) Property Plant and Equipment:

a) Freehold land is carried at historical cost. All other Tangible Fixed assets are stated at cost of acquisition or construction, less accumulated depreciation. All costs, including borrowing cost till respective assets is put to use, are capitalized.

b) Intangible assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any.

c) Transition to Ind AS,

On transition to Ind AS, the Company has opted to continue with the carrying value of all of its property, plant and equipment recognized as at April 01,2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment on the transition date.

B) Depreciation:

Depreciation has been provided as under:

(i) For assets existing on 1^st April 2014 the carrying amount will be amortized over the remaining useful lives on straight line method as prescribed in the schedule II of Companies Act, 2013.

(ii) For the assets added after the 1^st April 2014 :- On straight line method at the useful Lives prescribed in Schedule II to The Companies Act, 2013.

(iii) Depreciation on assets added/ disposed off during the year has been provided on pro-rata basis with reference to the days of addition/ disposal.

(iv) The residual values are not more than 5% of the original cost of the asset

3. Foreign Exchange Transaction

(i) Functional currency and presentation currency :

The functional currency of the Company is the Indian rupee. These financial statements are presented in Indian rupees, which is the Company’s functional and presentation currency.

(ii) Transactions and balances :

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the time of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions is recognized in statement of profit or loss.

At the reporting date, non-monetary items which are carried in terms of historical cost denominated in foreign currency are reported using the exchange rate at the date of transaction.

4. Investments

Investments that are readily realizable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All the other investments are classified as long-term investments. Current investments and Long Term Investments are carried at fair value at the Balance sheet date.

Transition to Ind AS :

(a) Investments :

Upon first time adoption of Ind AS, the Company has opted to value at fair Price to all of its investments as at April 1,2016 and use that carrying value as the deemed cost of such other investment on the transition date. The resulting gain or loss arising from such a transition is added to retained earnings in balance sheet as on the April 1,2016.

5. Inventories

Inventories are stated at lower of cost and net realizable value.

Cost of raw materials is determined using FIFO method. However, these items are considered to be realizable at cost if the finished products, in which they will be used, are expected to be sold at or above cost.

The cost of finished goods and Stock-in-process comprises raw materials, direct labour, other direct costs and related production overheads upto the relevant stage of completion.

Waste material are valued at Net Realizable value, if any.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.

6. Recognition of Income & Expenditure

(i) Revenue/ Incomes and Costs/ Expenditure are generally accounted on accrual, as they are earned or incurred.

(ii) a) Sale of Goods is recognized on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods. b) Sales of goods are accounted excluding taxes, wherever applicable.

(iii) Interest Income/ expenditure is recognized on the time proportion basis taking into account of the amount outstanding and the rate applicable.

(iii) Dividend income is recognized when the right to received dividend is established.

7. Customs Duty

Custom Duty is accounted for as and when paid on the clearance of the goods for home Consumption.

8. Employees Retirement and other benefits

a) Provident fund:-

The contribution of the Company on a monthly basis towards Provident Fund and Employee State Insurance, which are, defined contributions plans are charged to revenue. The company has paid to regulatory authority & has no further obligations other than these contributions.

b) Leave Encashment:-

The Company recognises and pays Leave Encashment on a quarterly basis to all Employees.

c) Gratuity:-

The company recognises and pays Gratuity on cash basis to the employees i.e. on Retirement, resignation, termination of employees.

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Mar 31, 2015

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

During the year fire accident took place causing loss of inventory and furniture of Rs.32,07,828/- and Rs. 27,40,000/- against which provision has been made for Insurance Claim receivable of Rs. 23,24,936/- and Rs. 13,42,063/- from Insurance Company disclosed in the note No. R under the head of "Other Income".

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost (including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule II to the Companies Act, 2013 and leasehold land is being written off over the lease period.

5) Investments:

I. Unquoted : Investments are valued at cost of acquisition.

6) Inventories:

I. Yam, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

7) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

8) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

9) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse Compensation.

10) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

11) Others:

Other accounting policies not specifically disclosed are in confirmity with the normally accepted accounting policies.

12) Impairment:

The management periodically assesses using internal sources whether there is any indication that an asset may be impaired. If an asset is impaired, the group recognizes an impairment loss as the carrying amount of the asset over the recoverable period.

13) Taxation:

Income Tax Expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income tax law), deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the period). The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation law, deferred tax asset are recognized only if there is a virtual certainty of realization of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realized.

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Mar 31, 2014

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

Claims receivable is accounted on cash basis.

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost ( including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule XIV to the Companies Act, 1956 and leasehold land is being written off over the lease period.

5) Intangible Assets :

Goodwill is fully written off during the year.

6) Investments :

I. Unquoted : Investments are valued at cost of acquisition.

7) Inventories:

I. Yarn, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

8) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

9) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

10) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse Compensation.

11) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

12) Others:

Other accounting policies not specifically disclosed are in confirmity with the normally accepted accounting policies.

13) Impairment:

The management periodically assesses using internal sources whether there is any indication that an asset may be impaired. If an asset is impaired, the group recognizes an impairment loss as the carrying amount of the asset over the recoverable period.

14) Taxation :

Income Tax Expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income tax law), deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the period). The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation law, deferred tax asset are recognized only if there is a virtual certainty of realization of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realized.

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Mar 31, 2013

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

Claims receivable is accounted on cash basis.

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost ( including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule XIV to the Companies Act, 1956 and leasehold land is being written off over the lease period.

5) Investments :

I. Unquoted : Investments are valued at cost of acquisition.

6) Inventories:

I. Yarn, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

7) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

8) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

9) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse Compensation.

10) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

11) Others:

Other accounting policies not specifically disclosed are in confirmity with the normally accepted accounting policies.

12) Impairment:

The management periodically assesses using internal sources whether there is any indication that an asset may be impaired. If an asset is impaired, the group recognizes an impairment loss as the carrying amount of the asset over the recoverable period.

13) Taxation :

Income Tax Expenses comprises of current tax (i.e. amount of tax for the period determined in accordance with the income tax law), deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the period) and Fringe Benefit Tax. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carried forward loss under taxation law, deferred tax asset are recognized only if there is a virtual certainty of realization of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realized.

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Mar 31, 2012

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

Claims receivable is accounted on cash basis.

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost (including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule XIV to the Companies Act, 1956 and leasehold land is being written off over the lease period.

5) Investments:

I. Quoted : Investments are valued at cost or market value whichever is lower.

II. Unquoted : Investments are valued at cost of acquisition.

6) Inventories:

I. Yarn, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

7) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

8) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

9) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse, compensation.

10) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

11) Others:

Other accounting policies not specifically disclosed are in conformity with the normally accepted accounting policies.

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Mar 31, 2011

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

Claims receivable is accounted on cash basis.

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost ( including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule XIV to the Companies Act, 1956 and leasehold land is being written off over the lease period.

5) Investments- Quoted/Unquoted:

I. Quoted : Investments are valued at cost or market value which ever is lower.

II. Unquoted : Investments are valued at cost of acquisition.

6) Inventories:

I. Yarn, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

7) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

8) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

9) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse Compensation.

10) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

11) Others:

Other accounting policies not specifically disclosed are in with the normally accepted accounting policies.

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Mar 31, 2010

1) System of Accounting:

The accounts have been prepared on historical cost basis of accounting. All expenses except commission and incentive on sale and income to the extent considered payable and receivable respectively unless stated otherwise are accounted for on accrual basis.

2) Claims Receivable:

Claims receivable is accounted on cash basis.

3) Dividend Receipts:

Dividend is accounted on cash basis.

4) Fixed Assets and Depreciation:

I. Fixed Assets: All Fixed Assets are valued at cost ( including Revaluation) less depreciation.

II. Depreciation: Depreciation has been calculated on all the assets of the Company under straight line method at the rates and in the manner as specified in Schedule XIV to the Companies Act, 1956 and leasehold land is being written off over the lease period.

5) Investments- Quoted /Unquoted:

I. Quoted : Investments are valued at cost or market value which ever is lower.

II. Unquoted : Investments are valued at cost of acquisition.

6) Inventories:

I. Yarn, packing materials, stores & spares and stock of unquoted shares (Long Term) are valued at cost (FIFO METHOD).

II. Stock in trade, readymade garments and goods in process are valued at cost or market value whichever is lower.

7) Employees Benefits:

I. The Company has taken Group Gratuity Insurance Policy with Life Insurance Corporation of India to secure gratuity liability on retirement of the employees of the Company. The premium payable/refund receivable if any, is accounted on cash basis.

II. Leave encashment is accounted on accrual basis.

8) Deferred Revenue Expenditure:

Major expenditure on advertisement and publicity are accounted as deferred revenue expenditure and are being written off over a period of 7 years.

9) Income from Operations:

Income from operations include sale of manufactured/traded goods, shares, services, warehouse Compensation.

10) Sales:

Sales represent amount billed for goods sold inclusive of Excise Duty and Sales Tax, but net off trade discounts, returns and allowances.

11) Others:

Other accounting policies not specifically disclosed are in confirmity with the normally accepted accounting policies.