Temptation Foods Ltd. कंपली की लेखा नीति

Mar 31, 2010

1. Basis of Presentation

The accounts have been prepared using historical cost convention and in accordance with Indian Generally Accepted Accounting principles (GAAP) on the accrual basis and in compliance with the Accounting Standards referred to in Section 211(3C) and other requirements of the Companies Act, 1956.

The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and assumptions that affect the reported amounts of incomes and expenses of the period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Actual results could differ from the estimates. Any revision to accounting estimates is recognised prospectively in the current and future periods. Wherever changes in presentation are made, comparative fgures of the previous year are regrouped accordingly.

2. Revenue Recognition

a) Revenue from the sale of manufactured and traded products is recognised as and when the products are supplied in accordance with the terms of sale and upon transfer of passage of title to the customer.

b) Sale of manufactured and traded products is net of trade discounts.

c) Dividend income is accounted on receipt basis.

3. Fixed Assets

a) Fixed assets are capitalised at acquisition cost (net of tax / duty credits availed, if any), including directly attributable costs, such as, freight, insurance and specific installation charges for bringing the assets to present condition and location.

b) Where expenditure increases the performance / life of an existing fixed asset as assessed earlier, such expenditure is added to the cost of the asset.

c) Assets acquired under finance lease are recognised at the lower of the fair value of the lease assets at inception and present value of minimum lease payments. Lease payments are apportioned between the finance charge and the outstanding liability. The finance charge is allocated to periods during the lease term at constant periodic rate of interest on the remaining balance of the liability.

5. Depreciation

a) Depreciation on tangible fixed assets is provided at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, on straight-line method.

b) Depreciation on assets costing upto Rs. 5,000 each are charged off fully in the year of purchase.

c) Leasehold Land is written off over the primary period of lease.

6. Impairment of Assets

a) The carrying amount of assets, other than inventories is reviewed at each Balance Sheet date to determine, whether there is any indication of impairment. If any such indication exists, the recoverable amount of the assets is estimated.

b) An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in use, which is determined based on the estimated future cash flow generated from the continuing use of an asset and from its disposal at the end of its useful life, discounted to their present values.

c) An impairment loss is reversed if there has been a change in the estimates made to determine and recognize the recoverable amount in the earlier year.

8. Borrowing Cost

a) Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale.

b) All other borrowing costs are recognised as an expense in the period in which they are incurred.

9. Investments

Long term investments are carried at cost less provision for any diminution other than temporary, in the value of such investments. Current investments are carried at lower of cost or market value. The determination of carrying amount of such investments is done on the basis of specific identification.

10. Foreign Currency Transactions

a) The reporting currency of the company is Indian Rupee.

b) Transactions in foreign currencies are recorded at the exchange rates / contracted rates prevailing on the transaction dates.

c) Monetary items of assets and liabilities in foreign currencies at the year end are translated at the prevailing exchange rate as at the close of the year.

d) Foreign exchange gains / losses on settlement / translation are recognized in the Profit and Loss account.

11. Employee Benefits

a) Short Term Employees Benefits:

All employee benefits payable wholly within twelve months of rendering the services are classified as short term employee benefits. Benefits such as salaries, wages, bonus, ex-gratia, etc.are recognised in the period in which the employees render the related services.

b) The rules of the company do not permit encashment of earned leave.

c) Post Employment benefts:

(i) Defned Contribution Plan: The Company’s state governed provident fund is defined contribution scheme. The contribution paid/payable under the scheme is recognized during the period in which the employee renders the related service.

(ii) Defined Benefit Plan: The employees of the company are covered under the Employees’ Group Gratuity scheme of Life Insurance Corporation of India. The present value of the obligation under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method.

12. Employees’ Stock Options

Stock Options granted to employees under the Employees’ Stock Option Scheme are accounted as per the intrinsic value method permitted by the “Guidance Note on Share Based Payments” issued by the Institute of Chartered Accountants of India. Accordingly, the excess of Fair value of the shares as on the date of grant of options over the Exercise price is recognized as deferred employee compensation and is charged to profit and loss account over the vesting period.

The number of options expected to vest is based on the best available estimate and would be revised, if necessary, if subsequent information indicates that the number of stock options expected to vest differs from previous estimates.

13. Taxes on Income

a) Tax on income for the current period is determined on the basis of estimated taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961 and based on the expected outcome of assessments / appeals.

b) Deferred tax is recognised on timing differences between the accounting income and the estimated taxable income for the year and quantified using the tax rates and laws enacted or substantially enacted as on the balance sheet date.

c) Deferred tax assets, other than brought forward business loss and unabsorbed depreciation, are recognised and carried forward to the extent there is reasonable certainty that sufficient future taxable income will be available against which deferred tax assets can be realised.

14. Provisions, Contingent Liabilities and Contingent Assets

a) Provisions are recognised for liabilities that can be measured only by using a substantial degree of estimation if

i) the Company has a present obligation as a result of past event;

ii) a probable outflow of resources is expected to settle the obligation; and

iii) the amount of obligation can be reliably estimated.

b) Contingent Assets are neither recognized nor disclosed.

c) Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

15. Events occuring After The Balance Sheet Date

Where material, events occurring after the date of the Balance Sheet are considered upto the date of approval of accounts by the Board of Directors.

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Mar 31, 2009

1. Basis of Presentation

The accounts have been prepared using historical cost convention and in accordance with Indian Generally Accepted Accounting principles (GAAP) on the accrual basis and in compliance with the Accounting Standards referred to in Section 211(3C) and other requirements of the Companies Act, 1956.

The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and assumptions that affect the reported amounts of incomes and expenses of the period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. Actual results could differ from the estimates. Any revisions to accounting estimates is recognised prospectively in the current and future periods. Wherever changes in presentation are made, comparative figures of the previous year are regrouped accordingly.

2. Revenue Recognition

a. Revenue from the sale of manufactured and traded products is recognised as and when the products are supplied in accordance with the terms of sale and upon transfer of passage of title to the customer.

b. Sale of manufactured and traded products are net of trade discounts.

3. Fixed Assets

a. Fixed assets are capitalised at acquisition cost (net of tax/duty credits availed, if any), including directly attributable costs, such as, freight, insurance and specific installation charges for bringing the assets to present condition and location.

b. Where an expenditure increases the performance/life of an existing fixed asset as assessed earlier, such expenditure is added to the cost of the asset.

c. Assets acquired under finance lease are recognised at the lower of the fair value of the lease assets at inception and present value of minimum lease payments. Lease payments are apportioned between the finance charge and the outstanding liability. The finance charge is allocated to periods during the lease term at constant periodic rate of interest on the remaining balance of the liability.

4. Intangible Assets and Amortisation Thereof

Intangible assets are recognized as per the criteria specified in Accounting Standard (AS 26) "Intangible Assets" and are amortised as follows:

Trade Marks, Brands any Copyright: Over the period of 10 years from the date of acquisition.

Application Software: Over the period of 3 years.

5. Depreciation

a. Depreciation on tangible fixed assets is provided at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, on straight-line method.

b. Depreciation on assets costing upto Rs.5,000 each are charged off fully in the year of purchase.

c. The leasehold land is written off over the primary period of lease.

6. Impairment Of Assets

a. The carrying amount of assets, other than inventories is reviewed at each Balance Sheet date to determine, whether there is any indication of impairment. If any such indication exists, the recoverable amount of the assets is estimated.

b. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use, which is determined based on the estimated future cash flow generated from the continuing use of an asset and from its disposal at the end of its useful life, discounted to their present values.

c. An impairment loss is reversed if there has been a change in the estimates made to determine and recognize the recoverable amount in the earlier year.

7. Inventories

Inventories are valued at the lower of cost or net realisable value after providing for damages and obsolescence as under:

a. Raw materials, packing materials stores and spares : At cost on FIFO

b. Traded Goods : At cost on FIFO

c. Work-in-progress : At cost plus appropriate production overheads

d. Finished Goods : At cost plus appropriate production overheads

8. Borrowing Cost

a. Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale.

b. All other borrowing costs are recognised as an expense in the period in which they are incurred.

9. Investments

Long term investments are carried at cost less provision for any diminution other than temporary, in the value of such investments. Current investments are carried at lower of cost or market value. The determination of carrying amount of such investments is done on the basis of specific identification.

10. Foreign Currency Transactions

a. The reporting currency of the Company is Indian Rupees.

b. Transactions in foreign currencies are recorded at the exchange rates/contracted rates prevailing on the transaction dates.

c. Monetory items of assets and liabilities in foreign currencies at the year end are translated at the prevailing exchange rate as at the close of the year.

d. Foreign exchange gains/losses on settlement/translation are recognized in the Profit and Loss account.

11. Employee Benefits

a. Short Term Employees Benefits:

All employees benefits payable wholly within twelve months of rendering the services are classified as short term employees benefits. Benefits such as salaries,wages, bonus, ex-gratia, etc.are recognised in the period in which the employees render the related services.

b. The rules of the Company does not permit encashment of earned leave.

c. Post Employment benefits:

(i) Defined Contribution Plan: The Companys state governed provident fund is defined contribution scheme. The contribution paid/payable under the scheme is recognized during the period in which the employees renders the related service.

(ii) Defined Benefit Plan: The employees of the Company are covered under the Employees Group Gratuity scheme of Life Insurance Corporation of India. The present value of the obligation under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method.

12. Employees Stock Options

Stock Options granted to employees under the Employees Stock Option Scheme are accounted as per the intrinsic value method permitted by the "Guidance Note on Share Based Payments" issued by the Institute of Chartered Accountants of India. Accordingly, the excess of Fair Market Price of the shares as on the date of grant of options over the Exercise price is recognized as deferred employee compensation and is charged to profit and loss account over the vesting period.

The number of options expected to vest is based on the best available estimate and would be revised, if necessary, if subsequent information indicates that the number of stock options expected to vest differs from previous estimates.

13. Taxes on Income

a. Tax on income for the current period is determined on the basis of estimated taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961 and based on the expected outcome of assessments/appeals.

b. Deferred tax is recognised on timing differences between the accounting income and the estimated taxable income for the year and quantified using the tax rates and laws enacted or substantially enacted as on the balance sheet date.

c. Deferred tax assets, other than brought forward business loss and unabsorbed depreciation, are recognised and carried forward to the extent there is reasonable certainty that sufficient future taxable income will be available against which deferred tax assets can be realised.

d. MAT credit is recognised as an asset in accordance with the recommendation provided in the Guidance Note issued by the Institute of Chartered Accountants of India.

e. Fringe Benefit Tax (FBT) on the Employees Stock Options is recognised in the profit and loss account when the liability crystalises upon vesting of such stock options. Whenever such FBT liability is borne by the employee, the same is not recognised.

FBT on all other expenses as specified in the Income Tax Act, 1961 is recognised in the profit and loss account when the underline expenses are incurred.

14. Provisions, Contingent Liabilities And Contingent Assets

a. Accounting for contingencies (gains and losses) arising out of contractual obligations, are accounted on the basis of mutual acceptances.

b. Contingent Assets are neither recognized nor disclosed.

c. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

15. Events Occuring After The Balance Sheet Date

Where material, events occurring after the date of the Balance Sheet are considered upto the date of approval of accounts by the Board of Directors.