Notes forming part of Balance Sheet and Profit & Loss account A) SIGNIFICANT ACCOUNTING POLICIES a) Basis of brparation of financial statements The accompanying financial statements are brpared and brsented under the historical cost convention on the accrual basis of accounting, and comply with the Accounting Standards brscribed by the Companies (Accounting Standards) Rules, 2006 ('the Rules') and the requirements of the Companies Act, 2013 ('the Act'), to the extent applicable to the Company. The financial statements are brsented in Indian Rupees. b)Use of Estimate The brparation of the financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenues and expenses and the disclosure of contingent liabilities on the date of the financial statement. Actual results could differ from the estimates. Any revision to accounting estimates is recognized prospectively in current and future periods. c) Debrciation The Assets are debrciated in accordance with the provisions of Schedule II of the Act. Schedule II of the act requires systematic allocation of the debrciable amount of an asset over its useful life. The said schedule also requires that the useful life of an asset should not be longer than the useful life brscribed in part C of the said schedule and the residual value of an asset should not be more than five percent of its original cost d) Impairment of Assets An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount. e) Foreign Currency Transactions Transaction in foreign currency is recorded at the exchange rates brvailing at the time of the transaction. Transaction gains or losses realized upon settlement of foreign currency transactions are included in the determining net profit for the period in which the transaction is settled. Monetary items denominated in the foreign currencies at the year end are restated at year end rates. f) Investments All the Investments have been valued at cost less any provisions for permanent diminution in value. g) Inventories Inventories are valued at lower of cost or net realisable value after providing for obsolescence, if any. h) Revenue recognition Items of revenue have been recognised in accordance with the Accounting Standard (AS-9). Accordingly, wherever there are uncertainties in the ascertainment /realisation of income, the same is not accounted for. Income is accounted for on accrual basis. i) Employee Benefits i. The company's contribution to provident fund in accordance with the Employee's Provident and Misc. Provision Act 1952 is not applicable. ii. The liability for gratuity to be provided in according to the provisions of the Payment of Gratuity Act 1972 is not applicable. j) Provision for Current and Deferred Tax Provision for current tax is made on the basis of estimated taxable income for the current accounting period in accordance with the provisions of Income tax Act, 1961. Deferred tax resulting from timing difference between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent there is a reasonable certainty that the deferred tax assets will be adjusted in future. k) Provisions and Contingencies A provision is recognised when there is a brsent obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, 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 at the Balance Sheet date. Contingent liabilities, if any are not recognised and are disclosed in the Notes on Accounts. l) Segment Reporting As per Accounting Standard (AS) 17 on "Segment Reporting", segment information has been provided under the Notes to Financial Statements. 2. Related Party Disclosure As per AS-18 "Related Party Disclosure" issued by the Institute of Chartered Accountants of India, the disclosures of transaction with the related parties as defined in the Accounting Standard are given below. I. Key Management Personnel: 1) Sudhir Naheta - Managing Director 2) Rajkumari Sudhir Naheta - Director 3. Contingent Liabilities: As reviewed by management, there was no contingent liability as at the end of the Financial Year reported. Fixed Deposit of Rs. 7,00,000 is pledged in favour of "President of India- Development Commissioner Indore SEZ" on behalf of M/s. CT Cotton Yarn Limited. The aforesaid Fixed Deposit is duly matured but is yet to be released by the said Authority. Balance of FDR as stated in Balance sheet is subject to confirmation from UCO Bank. 4. These financial statements have been brpared in the format brscribed by the Schedule III to the Companies Act 2013. Previous period figures have been recast/ restated to confirm to the classification of the current period. 5. The balance lying with the Share Broker agents rebrsents excess exchange margin lying with them against derivative transactions. 6. Micro, Small & Medium Enterprises: As required by section 22 of the Micro, Small & Medium Enterprises Development Act 2006 there is no amount overdue to any Micro, Small & Medium Enterprises and hence no disclosure required. As Per Our Report of Even Date Attached For Haren Sanghvi & Associates Chartered Accountants Firm Registration No. 120743W Sd/-Haren Sanghvi (Managing Partner) Membership No. 109246 For and on behalf of Board of Directors Sd/- Mr. Sudhir Naheta (Managing Director) Sd/- Mr. Prasad Parkar (Chief Financial Officer) Sd/- Ms. Rajkumari Naheta (Director) Sd/- Mr. Rahul Shinde (Company Secretary) Mumbai Dated: 11th May, 2015 |