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Moneycontrol.com India | Accounting Policy > Trading > Accounting Policy followed by Ambica Agar - BSE: 532335, NSE: AMBICAAGAR
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Ambica Agar

BSE: 532335|NSE: AMBICAAGAR|ISIN: INE792B01012|SECTOR: Trading
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Ambica Agar is not traded in the last 30 days
Mar 12
Accounting Policy Year : Mar '13
1.1 Basis of preparation of fnancial statements
 
 The fnancial statements have been prepared and presented under the
 historical cost convention on the accrual basis in accordance with the
 Generally Accepted Accounting Principles (GAAP) in India and comply
 with the Accounting Standards (AS) prescribed by Companies (Accounting
 Standard) Rules 2006, other pronouncements of the Institute of
 Chartered Accountants of India (ICAI) and the relevant provisions of
 the Companies Act, 1956, (the ''Act''), to the extent applicable.
 
 This is the frst year of application of the revised Schedule VI to the
 Companies Act, 1956 for the preparation of the fnancial statements of
 the company. The revised Schedule VI introduces some signifcant
 conceptual changes as well as new disclosures. These include
 classifcation of all assets and liabilities into current and
 non-current. The previous year fgures have also undergone a major
 reclassifcation to comply with the requirements of revised Schedule VI.
 
 1.2 Use of estimates
 
 The preparation of fnancial statements in conformity with Indian GAAP
 requires management to make estimates and assumptions that affect the
 reported amounts of assets and liabilities and the disclosure of
 contingent liabilities on the date of the fnancial statements and
 reported amounts of revenue and expense for the year. Actual results
 could differ from those estimates.  Any revision to accounting
 estimates is recognised prospectively in current and future periods.
 
 1.3 Current-non-current classifcation
 
 All assets and liabilities are classifed into current and non-current.
 
 Assets
 
 An asset is classifed as current when it satisfes any of the following
 criteria:
 
 (a) it is expected to be realized in, or is intended for sale or
 consumption in, the company''s normal operating cycle;
 
 (b) it is held primarily for the purpose of being traded;
 
 (c) it is expected to be realized within twelve months after the
 reporting date; or
 
 (d) it is cash or cash equivalent unless it is restricted from being
 exchanged or used to settle a liability for at least twelve months
 after the reporting date.
 
 All other assets are classifed as non-current.
 
 Liabilities
 
 A liability is classifed as current when it satisfes any of the
 following criteria:
 
 (a) it is expected to be settled in the company''s normal operating
 cycle;
 
 (b) it is held primarily for the purpose of being traded;
 
 (c) it is due to be settled within twelve months after the reporting
 date; or
 
 (d) the company does not have an unconditional right to defer
 settlement of the liability for at least twelve months after the
 reporting date. Terms of a liability that could, at the option of the
 counterparty, result in its settlement by the issue of equity
 instruments do not affect its classifcation.
 
 All other liabilities are classifed as non-current.
 
 Operating cycle
 
 Operating cycle is the time between the acquisition of assets for
 processing and their realisation in cash or cash equivalents
 
 1.4 Fixed Assets:
 
 Fixed Assets are stated cost less accumulated depreciation. Cost
 comprises purchase price, including import duties and other
 non-refundable taxes or levies and any directly attributable cost of
 bringing the asset to its working condition for its intended use.
 
 1.5 Depreciation:
 
 The Company adopts a policy to provide depreciation on Straight Line
 Method as per Schedule XIV of the Companies Act, 1956. In respect of
 additions / deletions during the year, depreciation was provided on
 prorata basis with reference to the date of addition / disposal.
 
 1.6 Intangible Assets:
 
 Intangible Assets are recognized if they are separately identifable and
 the Company controls the future economic benefts arising out of them.
 All other expenses on intangible items are charged to the proft and
 loss account. Trade Marks of the Company is amortized over a period of
 10 years under Straight Line Method (SLM).
 
 1.7 Inventories:
 
 Inventories are stated at lower of Cost or Net Realizable Value. Cost
 is computed based on weighted average cost method. Cost comprises of
 cost of purchase, cost of conversion and other cost incurred in
 bringing them to their present condition and location.
 
 1.8 Revenue Recognition:
 
 Revenue on sale of goods is recognized on transfer of risk and reward
 of ownership to the buyer.
 
 Interest Income is recognized on accrual basis.
 
 Contract Revenue is recognized on Percentage of Completion basis
 measured by the proportion that the cost incurred up to the reporting
 date bear to the estimated total cost of the contract.
 
 1.9 Turnover:
 
 Turnover includes Sale of goods, Services, Sales Tax (VAT), Service
 Tax and Luxury Tax.
 
 1.10 Foreign Exchange Transactions:
 
 Foreign exchange transactions are accounted based on the exchange rate
 prevailing as on the date of the transaction. Balances outstanding at
 the year-end are reported at the exchange rate prevailing as on the
 date of the Balance Sheet. The resulting proft/loss due to foreign
 exchange fuctuation is transferred to Proft & Loss Account, if it is of
 revenue in nature and to respective fxed assets if it is of Capital in
 nature.
 
 1.11 Investments :
 
 Investments, being long term in nature, are valued at cost of
 acquisition. Adjustment for increase/decrease in the value of
 investments, if any, will be accounted for on realisation of the
 investments. A provision for diminution is made to recognise a decline,
 other than temporary, in the value of long term investments.
 
 1.12 Employee Benefts:
 
 Short-term employee benefts are recognised as an expense at the
 undiscounted amount in the proft and loss account of the year in which
 the related service is rendered.
 
 Post employment and other long term employee benefts are charged off in
 the year in which the employee has rendered services. The amount
 charged off is recognised at the present value of the amounts payable
 determined using actuarial valuation techniques. Actuarial gains and
 losses in respect of past employment and other long term benefts are
 charged to the proft and loss account.
 
 1.13 Borrowing Cost :
 
 Borrowing costs that are attributable to the acquisition or
 construction of qualifying assets are capitalised as part of the cost
 of such assets. A qualifying asset is one that takes necessarily
 substantial period of time to get ready for its intended use. All other
 borrowing costs are charged to revenue.
 
 1.14 Income taxes
 
 Income tax expense comprise of current tax and deferred tax.
 
 Current tax
 
 The current charge for income taxes is calculated in accordance with
 the relevant tax regulations applicable to the Company.
 
 Deferred tax
 
 Deferred tax charge or beneft refects the tax effects of timing
 differences between accounting income and taxable income, which
 originate during the year but reverse after the tax holiday period. The
 deferred tax charge or beneft and the corresponding deferred tax
 liabilities or assets are recognised using the tax rates that have been
 enacted or substantially enacted by the balance sheet date.
 
 Deferred tax assets are recognised only to the extent there is
 reasonable certainty that the assets can be realised in future;
 however, where there is unabsorbed depreciation or carry forward of
 losses, deferred tax assets are recognised only if there is a virtual
 certainty of realisation of such assets. Deferred tax assets are
 reviewed at each balance sheet date and written down or written-up to
 refect the amount that is reasonably / virtually certain to be
 realised. The break-up of the deferred tax assets and liabilities as at
 the balance sheet date has been arrived at after setting-off deferred
 tax assets and liabilities where the Company has a legally enforceable
 right and an intention to set-off assets against liabilities and where
 such assets and liabilities relate to taxes on income levied by the
 same governing taxation laws.
 
 1.15 Impairment of Assets:
 
 At each balance sheet date, the company reviews the carrying amounts of
 its fxed assets to determine whether there is any indication that those
 assets suffered an impairment loss. If any such indication exists, the
 recoverable amount of the asset is estimated in order to determine the
 extent of impairment loss. Recoverable amount is the higher of an
 assets'' net selling price and value in use. In assessing value in use,
 the estimated future cash fows expected from the continuing use of
 asset and from its disposal are discounted to their present value using
 a pre- tax discount rate that refects the current market assessments of
 time value of money and the risks specifc to the asset.
 
 Reversal of impairment losses recognized in prior years, if any, is
 recorded when there is an indication that the impairment losses
 recognized for the asset no longer exist or have decreased. However,
 the increase in carrying amount of an asset due to reversal of an
 impairment loss is recognized to the extent it does not exceed the
 carrying amount that would have been determined (net of depreciation)
 had no impairment loss been recognized for the asset in prior year.
 
 1.16 Provisions and Contingencies:
 
 A provision is recognized when the company has a present legal or
 constructive obligation as a result of past event and it is probable
 that an outfow of resources will be required to settle the obligation.
 In respect of which reliable estimate can be made. Provisions
 (excluding retirement benefts) are not discounted to its present value
 and are determined based on best estimate required to settle the
 obligation at the balance sheet date. These are reviewed at each
 balance sheet date and adjusted to refect the current best estimates.
 
 Contingent liabilities are not recognized and, if any, are adequately
 disclosed in the notes to accounts.
 
 1.17 Earnings per Share:
 
 Basic earnings per share is computed by dividing net proft or loss for
 the period attributable to equity shareholders by the weighted average
 number of equity shares outstanding for the period.
 
 For the purpose of calculating diluted earnings per share, the net
 proft or loss for the period attributable to equity shareholders and
 the weighted average number of shares outstanding during the period are
 adjusted for the effects of all diluted potential equity shares.
Source : Dion Global Solutions Limited
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