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NTC Industries
BSE: 526723|ISIN: INE920C01017|SECTOR: Cigarettes
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NTC Industries is not listed on NSE
Mar 12
Accounting Policy Year : Mar '13
A.  Basis of Preparation of Financial Statements
 
 The financial statements are prepared under historical cost convention
 on accrual basis as a going concern and in accordance with the
 Generally Accepted Accounting Principles (GAAP), the Companies Act,
 1956 and in compliance with Companies (Accounting Standard) Rules,
 2006, (as amended) as notified u/s 211(3C) of Companies Act, 1956
 except those with significant uncertainty. Accounting policies not
 stated explicitly otherwise are consistent with Generally Accepted
 Accounting Principles.
 
 B.  Use of Estimates
 
 The preparation of financial statements in conformity with Indian GAAP
 requires management to make estimates and assumptions that affect the
 balances of assets and liabilities and disclosures relating to
 contingent liabilities as at the balance sheet date and amounts of
 income and expenses during the year. Examples of such estimates include
 income taxes and future obligation under employee retirement benefit
 plans. Actual results could differ from those estimated. The effects of
 adjustment arising from revisions made to the estimates are included in
 the statement of profit and loss of the year in which such revisions
 are made.
 
 C.  Current and Non-Current
 
 All the assets and liabilities have been classified as current and
 non-current as per Company''s normal operating cycle and other criteria
 set out in the Revised Schedule VI to the Companies Act, 1956.
 
 D.  Revenue Recognition
 
 a) Revenue from sale of goods are recognised on transfer of all
 significant risks and rewards of ownership to the buyer. Sales
 represents invoice value of finished goods sold inclusive of excise
 duty and value added tax but excludes sales returns, claims, rate
 difference etc.
 
 b) Revenue from services are recognised on rendering of services to
 customers except otherwise stated.
 
 c) Rental income (exclusive of Service Tax) from assets given on
 operating lease is recognised using straight line method. Contingent
 rent is recognised as income to reflect systematic allocation of
 earnings over the lease period. This policy is not applicable for
 variable rental income based on turnover of the tenant.
 
 Other Income
 
 d) Interest income is recognised on time proportion basis taking into
 account the amount outstanding and the rate applicable.
 
 e) Dividend income is recognised when the right to receive is
 established.
 
 f) Excise, insurance and other claims/refunds are accounted for on
 acceptance/actual receipt/ payment basis.
 
 E.  Fixed Assets
 
 i) Tangible assets, including those given on operating lease, are
 stated at cost of acquisition inclusive of freight incurred, duties and
 taxes (net of CENVAT/VAT) and incidental expenses less accumulated
 depreciation.
 
 ii) Capital work in progress, cost incurred on construction of fixed
 assets consists of all directly attributable expenditure.
 
 F.  Depreciation
 
 Depreciation is provided on fixed assets including those given on
 operating lease on written down value method at the rates and in the
 manner specified in Schedule - XIV of the Companies Act, 1956.
 
 G.  Impairment of Assets
 
 An asset is treated as impaired when the carrying cost of the same
 exceeds its recoverable amount. Impairment is charged to statement of
 profit and loss in the year in which an asset is identified as
 impaired. The impairment losses recognised in prior accounting period
 are reversed if there has been a change in the estimate of the
 recoverable amount.
 
 H.  Investments
 
 Investments are bifurcated into non current and current on the basis of
 intention of holding. Investments that are readily realisable and
 intended to be held for not more than a year from the date of balance
 sheet are classified as current investments. All other investments are
 classified as non current. Current Investments are carried at lower of
 cost or fair market value, determined on an individual investment
 basis. Non current investments are carried at cost. Provision for
 diminution in the value of non current investments is made, only if
 such a diminution is other than temporary.
 
 I.  Inventories
 
 a) Raw materials : At lower of weighted average cost or net realisable
 value.
 
 b) Work in progress : At lower of cost or net realisable value.
 
 c) Finished goods and Stock in trade : At lower of cost or net
 realisable value.
 
 d) Stores and spares, packing and printing materials : At lower of
 weighted average cost or net realisable value.
 
 J.  Cash and Cash Equivalents
 
 Cash and cash equivalents include cash on hand, demand deposits with
 banks, other short-term highly liquid investments without significant
 risk and with original maturities of three months or less as per the AS
 - 3 CASH FLOWSTATMENT.
 
 K.  Foreign Currency Transactions
 
 Transactions denominated in foreign currencies are recorded at the
 exchange rate prevailing at the date of the transactions or that
 approximates the actual rate at the date of transactions.
 
 Exchange differences arising on foreign exchange transactions settled
 during the year are recognised in the statement of profit and loss for
 the year.
 
 L.  Excise Duty
 
 Excise Duty has been accounted for at the time of manufacture of goods,
 accordingly excise duty on finished goods lying as stock in factory has
 been considered for valuation.
 
 M.  Employee Benefits
 
 a) Short term employee benefits
 
 All employee benefits payable wholly within twelve months of rendering
 the service are classified as short- term employee benefits. Benefits
 such as salaries, wages and short term compensated absences, the
 expected cost of ex-gratia, etc are recognised in the period in which
 the employee renders the related service.
 
 b) Post-employment benefits
 
 i) Defined Contribution Plan : Employee benefits in the form of
 Provident Fund etc. are considered as defined contribution plan and the
 contributions are charged to the statement of profit & loss for the
 year when the contributions to the respective funds are due.
 
 ii) Defined Benefit Plan : Employee benefits in the form of gratuity
 and leave encashment are considered as defined benefit plan and are
 provided for on the basis of an independent actuarial valuation, using
 the projected unit credit method, as at the balance sheet date as per
 requirements of Accounting Standard- 15 (Revised 2005) on Employee
 Benefits. Actuarial gains/losses, if any, are immediately recognised
 in the statement of profit and loss.
 
 N.  Taxation
 
 a) Current Tax : Current Tax is determined as the amount of tax payable
 in respect of taxable income for the year in accordance with the
 provisions of the Income Tax Act, 1961. Minimum Alternative Tax credit
 available under Section 115JB of the Income Tax Act, 1961 are accounted
 in the year in which the benefits are claimed.
 
 b) Deferred Tax : Deferred Tax is recognised subject to consideration
 of prudence on the basis of timing differences being the difference
 between taxable income and accounting income that originate in one
 period and is capable of reversal in one or more subsequent periods
 using the tax rates and laws that have been enacted or substantially
 enacted as at the balance sheet date. Deferred tax asset is recognised
 and carried forward only to the extent there is reasonable certainty
 that the asset will be realised in future.
 
 O.  Provisions/Contingencies
 
 A provision is recognised for a present obligation as a result of past
 events if it is probable that an outflow of resources will be required
 to settle the obligation and in respect of which a reliable estimate
 can be made.  Provisions are determined based on best estimate of the
 amount required to settle the obligation as at the balance sheet date.
 Liabilities which are material and whose future outcome cannot be
 ascertained with reasonable certainty are treated as contingent
 liability and are disclosed by way of notes to accounts.
 
 P.  Prior Period Adjustments
 
 Adjustment of identifiable items of income and expenditure pertaining
 to prior period are accounted for as prior period adjustments.
 
 The Company is in communication with its suppliers to ascertain the
 applicability of The Micro, Small and Medium Enterprises Development
 Act, 2006. As at the date of this balance sheet the company has not
 received any communications from any of its suppliers regarding the
 applicability of the Act to them. This has been relied upon by the
 auditors.
 
 In the opinion of the Board the current assets, loans and advances are
 not less than the stated value if realised in ordinary course of
 business. The provisions for all known liabilities are adequate. There
 are no contingent liabilities except stated, as informed by the
 management.
 
 The Business of the company falls under a single segment i.e.
 Manufacturing of Cigarette and Smoking Mixture. In view of the general
 classification notified by Central Government in exercise of powers
 conferred u/s 211(3C) of Companies Act, 1956 for companies operating in
 single segment, the disclosure requirement as per Accounting Standard
 -17 on Segment Reporting are not applicable to the Company. The
 Company''s business is mainly concentrated in similar geographical,
 political and economical conditions; hence disclosure for geographical
 segment is also not required.
Source : Dion Global Solutions Limited
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