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Moneycontrol.com India | Accounting Policy > Textiles - Spinning - Synthetic Blended > Accounting Policy followed by Aditya Spinners - BSE: 521141, NSE: ADITYASPIN
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Aditya Spinners

BSE: 521141|NSE: ADITYASPIN|ISIN: INE122D01026|SECTOR: Textiles - Spinning - Synthetic Blended
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Aditya Spinners is not traded in the last 30 days
Mar 14
Accounting Policy Year : Mar '15
a. Corporate information:
 
 Adilya Spinners Limited fLThe Company*) was incorporated on i4ih
 February 1991 as a public limited company, its shares are Irsted on
 Bombay Stock Exchange. The Company is engager in manufacturing and
 selling of yam
 
 b. Basis of Preparation
 
 The financial statements have oeen prepared and presented in accordance
 with Indian Generally Accepted Accounting Principles (GAAP) under the
 histoncal cost convention or the accrual basis. GAAP comprises
 accounting standards notified by the Central Government of Fndea under
 Section 133 of the Companies Act, 2013, other pronouncements of
 Institute of Chartered Accountants of India, the provisions of
 Companies Act, 2D13. Accounting policies have been consistently aopEied
 and managemeni evaluates alt recently issued or neviseo accounting
 standards or an ongoing basis.
 
 c. Use of Estimates
 
 The preparation of financial statements to conformity with the Indian
 GAAP requires estimates and assumptions to be made that affect the
 reported amounts of assets and liabilities on the date of fhe financial
 statements, the reporting amounts of revenue and expenses during the
 reporting period and the disclosures relating to contingent iiab hties
 as on itie dale of financial statements. Although these estimates are
 based on the managements best Knowledge of current events and actions,
 uncertainty about these assumptions and estimates could resutt in
 outcomes different from the estimates Difference between actua'' results
 and estimates are recognized in the period in which the results are
 known or nratenaltze
 
 Estimates and underlying assumptions are reviewed on an ongoing basis
 Any revision to accounting estimate* is recognized prospectively in the
 current and future periods.
 
 d. Fixed Assets:
 
 Fixed Assets are carried at the cost of acquisition or construction
 less accumulated depreciation. The cost of fixed assets includes non -
 refundable taxes duties, freight and other incidental expenses related
 to the acquisition and installation of the respective assets Borrowing
 costs directly attributable to the acquisition or construction of those
 fixed assets which necessarily take a substantial period of rime to get
 ready for their intended use are capitalizes
 
 Plani and Machinery was revalued as on 01.tM.20t4 The surplus arising
 from the revaluation has been transferred to uRevaluation Reserve1 and
 shown under the head Reserves & Surplus1. The revaluation of fixed
 assets has been mode by appraisal method by an external competent
 valuer.
 
 Depreciation on Tangible Fixed Assets
 
 Depreciation on Fixed Assets have been charged based on the useftF
 life, fn accordance wrtb Schedule If of the Companies Act. 2313
 
 The Management estimates the usefor rives of the revalued Plant and
 Machinery as 12 fears.
 
 Depreciation on the revalued assets is adjusted against revaluation
 reserve without debiting to Statement Profit S Loss.
 
 Scrap @ 5% of original cost an all tangible assets except Revalued
 Plan! and machinery tias been considered. Sera p @ 5% oF revoi ued amou
 nt has bee n carsid seed on revalued Plant ana Machinery. Depreciation
 es calculated on a pro- rata basis from the date or installation I
 revaluation till the date the assets are sold or disposed. Individual
 assets costing less than Rs.S.QQQ are depreciated in full in the year
 oF acquisition. Freehold land is not depreciated
 
 Impairment of Assets:
 
 The Company assesses at each Balance Sheet date whether there is any
 indication that an asset may be impaired IF any su ch indication
 exists. tti e Company estimates the recoverable amount of the asset, tf
 such recoverab e amount oF the asset or the recoverabFe amounl of the
 cash generating unit to which the asset belongs to is less than its
 carrying amount, impairment provision is created to bring down the
 carrying value to its recoverable amount. The reduction is treated as
 an impairment loss and ss recognized in the Statement of Profit and
 Loss. If at the Balance Sheet dare, there is an indication that if a
 previously assessed impairment loss no longer exists, the recoverable
 amount js reassessed and the impairment provision created earlier is
 reversed to bring it at the recoverable antount subject to a maximum of
 depreciated historical cost
 
 e, Expenditure during construction period
 
 Expenditure during construction period is grouped under Capital Work
 tn Progress'' and the same is allocated to the respective Fixed Assets
 on the completion of its construction
 
 f. Revenue Recognition:
 
 Sales are recognized at the point of dispatch i.e., when significant
 risk is transferred: to customers, except in the case of consignment
 agents where the revenue is recognized only after the sale is effected
 by fhe consignment agent Sale value includes Excise Duty and Vat
 
 g Inventory Valuation:
 
 Inventories including wwfc-in-progness are valued at lower of coal and
 net realizable value. Cost of inventory comprises all cost cf purchase,
 cost of conversion and other costs incurred in bringing the inventories
 to their present location and condition
 
 The cost of Raw Materials. Stores and Spares and Packing Materials is
 oetemruned by using the Weighted1 Average Cost Method. The cost of
 Work-imProgress and Finished Goods is determined by weighted average
 Cost Method and includes appropriate share of production overheads
 
 h. Investments:
 
 Investments are either classified qs current or tong term. Current
 investments are carried at the lower of cast and market value. Long
 term investments are carded at coat less any permanent diminution in
 value, determined separately fbreach individual investmenL The
 reduction in the carrying amount is reversed when there is a rise in
 the value of the investment or tf the reasons for the reduction no
 longer exist
 
 i Employee Benefits
 
 Short term benefits
 
 Short term employee benefits are charged off at the undisco united
 amount in the year m which the related services are rendered.
 
 Long term benefits
 
 Payments to the defined contribution retirement benefit schemes are
 changed as an expense as they fall due.
 
 Gratuity
 
 Gratuity liability is a defined benefit obligation and is based on Ehe
 actuarial valuation All actuarial gains/i osses are immediately charged
 to the Profit and Loss Account and are not deferred.
 
 Provident fund
 
 The company has a denned contribution plan for Provident Fund under
 which the company contributes the fond to the Regional Provident Fund
 Comntissioner
 
 j, Income-Tax expense
 
 Income tax expense comprises current tax and deferred tax charge or
 credit.
 
 Current tax
 
 The current charge for income taxes is calculated tn accordance with
 the relevant lax regulations applicable to the company.
 
 Deferred lax
 
 Deferred tax charge of credit reflects the tax effects due to timing
 differences between accounting income and !axable income for the
 period. The deferred tax charge or credit and the corresponding
 deferred lax liabilities or assets are recogn-zed using the tax rates
 that have been enacted or substantial ly enacted by the balance s heet
 date Deferred fax assets are recognized only to the extent there is
 reasonable certainty that assets can be realized in future; however,
 where there is unabsorbed depreciation or carry forward of losses,
 deferred tax assets are recognized only if there is a virtual certainty
 of realization of such assets. Deferred tax assets are reviewed ai 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
 realizee
 
 k, Earnings per share
 
 The basic earnings per share (JEPS'') is computed by dividing the net
 profit after tax for the year by weighted average number of equity
 shares outstanding dunng the year For the purpose of caicuFating
 diluted earnings per share, net profit after tax for the year and the
 weighted average number of shares outstanding during the year are
 adjusted for the effects of ail dilutive poterrtiaE equity shares
 
 l, Provisions and contingent liabilities
 
 The Company creates a provision where there is a present obfigation as
 a result of a past event that probably requires an outflow of resources
 and a reliable estimate can tie made of the amount of obligation. A
 disclosure for a contingent Aability is made when there is a possible
 obligation or a present obligation lhat may. but probably w;li not,
 require an outflow of resources. Where there is possible obligation ora
 present obligation i n respect of whi ch the likelihood of outflow
 resources -s remote, oo provision or disclosure is made
 
 m.  Borrowing Costs:
 
 Borrowing costs attributable to the qualifying fixed assets during
 construction, re nova ton and modernization are capitalized. Such
 borrowing costs are apportioned on the average balance of capital
 work-in-progress far Hie year Other borrowing costs are recognizee as
 an expense in the period in which they are incurred.
 
 Boro wing cost consists of interest and other financial costs incurred
 in connection with: borrowing of funds.
 
 n.  Cash flow statement
 
 Casti flows are reported using the indirect method, whereby net profit/
 (loss} before tax is adjusted for the effects of transactions of a
 non-cash nature and any deferrals or ac cru ala of past or future cash
 receipts or payments. The cash flows from regular re ven u e
 generating, investing and financing activities of the company are
 segregated
Source : Dion Global Solutions Limited
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