SENSEX NIFTY India | Accounting Policy > Diversified > Accounting Policy followed by Kokuyo Camlin - BSE: 523207, NSE: KOKUYOCMLN

Kokuyo Camlin

BSE: 523207|NSE: KOKUYOCMLN|ISIN: INE760A01029|SECTOR: Diversified
Dec 07, 16:00
1.55 (1.92%)
VOLUME 6,553
Dec 07, 15:59
0.65 (0.8%)
VOLUME 35,065
« Mar 14
Accounting Policy Year : Mar '15
A. Basis of Preparation of Financial Statements:
 The financial statements have been prepared under the historical cost
 convention on the accrual basis of accounting, in accordance with the
 generally accepted accounting principles in India to comply with the
 Accounting Standards specified under Section 133 of the Companies Act,
 2013(the Act) read with Rule 7 of the Companies (Accounts) Rules,
 2014 (as amended) and the relevant provisions of the Act.
 The accounting policies adopted in the preparation of the financial
 statements are consistent with those of the previous year.
 B. Use of Estimates:
 The preparation of financial statements requires estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities (including contingent liabilities) on the date of financial
 statements and the reported amount of revenues and expenses, during the
 reported period. Actual results could differ from those estimates.
 C. Fixed Assets:
 i. Fixed Assets are recorded at cost of acquisition or construction and
 they are stated at historical cost (net of Cenvat and Vat). Interest on
 project loans and all direct expenses attributable to acquisition of
 Fixed Assets are capitalised, upto the date of installation.
 Capitalised hardware/ software costs of Enterprise Resource Planning
 (ERP) System include cost of designing software, which provides
 significant future economic benefits over an extended period. The cost
 comprises of license fee, cost of system integration and initial
 customization. The costs are capitalised in the year in which the
 relevant system is ready for intended use. The upgradation/enhancements
 are also capitalised and assimilated with the initial capitalisation
 ii. In compliance with Accounting Standard (AS) 28 - Impairment of
 Assets issued by the Institute of Chartered Accountants of India
 (ICAI), the Company assesses at each Balance Sheet date whether there
 is any indication that any asset may be impaired. If any such
 indication exists, the recoverable amount of the asset is estimated.
 Impairment loss is recognised wherever carrying amount exceeds the
 recoverable amount.
 iii. The depreciation on all assets of the company excluding freehold
 land & leasehold land has been charged to write off the cost less
 residual value using the straight-line basis over the expected/
 estimated useful life in the manner as specified in Schedule II of the
 Companies Act 2013.  Residual values have been reviewed and considered
 by the management. The normal expected/ estimated useful lives of major
 categories of Fixed Assets are as follows:
 Freehold Land NIL
 Leasehold Land Lease term
 Site developments 30 years
 Buildings & sheds 30 years and 60 years
 Plant & Machinery & Electrical Installation 7.5 years to 25 years
 Office equipment 3 to 6 years
 ERP Hardware & Software 5 years
 Vehicles 8 to 10 years
 D. Investments:
 Long-term investments are stated at cost and provision is made when
 there is decline, other than temporary, in the value thereof. Current
 investments are stated at cost or fair value whichever is lower.
 E. Valuation of Inventories:
 A. Raw Materials and Packing Materials
 At moving weighted average cost, written down to realizable value if
 the costs of related finished goods exceed net realisable value.
 B. Work in process
 At lower of moving weighted average cost or net realisable value.
 C. Finished Goods
 At lower of moving weighted average cost or net realisable value.
 F. Excise Duty:
 Excise duty on finished goods manufactured is accounted on clearance of
 goods from factory premises and also in respect of year end stocks in
 bonded warehouse. CENVAT credit is accounted by adjustment against cost
 immediately upon receipt of the relevant input. Input credit not
 recoverable is charged to the Statement of Profit and Loss.
 G. Foreign Currency Transactions:
 i. Transactions in foreign currencies are recorded at the exchange
 rates prevailing on the date of transaction. Foreign currency assets
 and liabilities are translated at year end exchange rates.  Exchange
 difference arising on settlement of transactions and translation of
 monetary items are recognised as income or expense in the year in which
 they arise.
 ii. In respect of forward exchange contracts the difference between the
 forward rate and the exchange rate at the inception of contract is
 recognised as income or expense over the period of the contract.
 iii. Gains or losses on cancellation/settlement of forward exchange
 contracts are recognised as income or expense.
 H. Research and Development:
 Revenue expenditure incurred on Research and Development is charged to
 Statement of Profit and Loss for the year. Capital expenditure on
 Research and Development is accounted as Fixed Assets.
 I. Employee Benefits:
 i. Short term employee benefits are recognised as an expense at the
 undiscounted amount in the Statement of Profit and Loss of the year in
 which the related service is rendered.
 ii. Post employment and other long-term employees benefits are
 recognised as an expense in the Statement of Profit and Loss for the
 year in which the employee has rendered the service. The expense is
 recognised at the present value of the amount payable determined using
 actuarial valuation techniques. Actuarial gains and losses in respect
 of post-employment and other long- term benefits are charged to the
 Statement of Profit and Loss for the year.
 J. Revenue/Expense Recognition:
 i. Revenue from sale of goods is accounted for on the basis of dispatch
 of goods. Sales are inclusive of excise duty and net of sales
 returns/Trade Discount.
 ii. Revenue in respect of overdue interest, insurance claim, etc is
 recognized to the extent the Company is reasonably certain of its
 ultimate realisation.
 iii. Remission from Excise Duty paid in respect of clearance from Jammu
 Plant is recognised as revenue based on legal advice obtained by the
 Company [Refer Note No.17].
 iv. Expenses are accounted for on accrual basis.
 v. Provisions are recognised when a present legal or constructive
 obligation exists and the payment is probable and can be reliably
 vi. Lease Rentals in respect of assets taken on operating lease are
 charged to the Statement of Profit and Loss on straight line basis over
 the lease term.
 K. Government Grants:
 i. Where the grants are of the nature of promoters'' contribution with
 reference to total investment in the undertaking or total capital
 outlay, they are treated as capital reserve.
 ii. Grants related to specific fixed assets are deducted from the book
 value of the related asset.
 iii. Grants related to revenue are credited to the Statement of Profit
 and Loss and presented as income from operations.
 L. Borrowing Cost:
 Borrowing cost attributable to acquisition of qualifying fixed assets
 which takes substantial period of time to get ready for its intended
 use is capitalised as part of the cost of such fixed assets. All other
 borrowing costs are charged to revenue.
 M. Share Issue Expenses:
 Expenses incurred in connection with fresh issue of share capital are
 adjusted against securities premium reserve in the year in which they
 are incurred.
 N. Contingent Liabilities:
 Liabilities are disclosed by way of Notes appended to the Financial
 Statements in case there is an obligation that probably may not require
 cash outflow.
 O. Accounting for Taxes on Income:
 Current tax is determined as the amount of tax payable in respect of
 taxable income for the period.  Deferred tax on timing differences,
 being the difference between taxable income and accounting income that
 originate in one period and are capable of reversal in one or more
 subsequent periods is accounted for using the tax rates and tax laws
 enacted or substantively enacted as on the balance sheet date. Deferred
 tax assets arising on account of unabsorbed depreciation or carry
 forward of tax losses are recognised only to the extent that there is
 virtual certainty supported by convincing evidence that sufficient
 future taxable income will be available against which such deferred tax
 assets can be realised. Other deferred tax assets are recognised only
 when there is a reasonable certainty of their realisation.
 P. Earnings per share:
 The Company reports basic and diluted earnings per share in accordance
 with Accounting Standard (AS) 20 on Earning per share issued by the
 Institute of Chartered Accountants of India (ICAI). Basic earnings per
 equity share is computed by dividing net income by weighted average
 number of equity shares outstanding for the period. Diluted earnings
 per equity share is computed by dividing net income by the weighted
 average number of equity shares outstanding including shares pending
Source : Dion Global Solutions Limited
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