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65
Annual Report 2011-12
64 Kajaria Ceramics Limited
Notes on Accounts
I.
Basis of Accounting:
The Company prepares its financial statements in accordance with applicable accounting standards and generally accepted
accounting principles and also in accordance with the requirements of the Companies Act, 1956.
II. Income and Expenditure:
Accounting of Income & Expenditure is done on accrual basis.
III. Tangible, Intangible Assets & Depreciation:
a) Fixed assets are stated at their original cost of acquisition inclusive of inward freight, duties and expenditure incurred
in the acquisition, construction/installation. CENVAT/ VAT credit availed on capital equipment is accounted for by
credit to respective fixed assets.
b) In case of assets acquired out of foreign currency loans, the increase/decrease in liability on account of fluctuation in
exchange rates has been charged to Profit & Loss Account.
c) Depreciation is charged on Straight Line Method at the rates provided in Schedule XIV of the Companies Act, 1956.
Continuous process plant as defined in Schedule XIV has been considered on technical evaluation. In case of assets
of sale outlets of dealers, depreciation is charged @ 20% on SLM basis. Assets costing upto
`
5,000/- are fully
depreciated in the year of purchase.
IV. Investments:
Long term investments are stated at cost.
V. Inventories:
Inventories are valued on the following basis:
a) Stores and Spares - at moving weighted average basis.
b) Raw Materials - at moving weighted average basis.
c) Work-in-Process - at estimated cost
d) Finished Goods - at lower of cost or estimated realisable value.
e) Stock in trade - at lower of cost or estimated realisable value.
f) Material in Transit - at cost.
VI. Excise & Custom Duty:
a) Custom Duty is accounted for at the time receipt of goods in custom warehouse.
b) CENVAT Credit, to the extent availed, is adjusted towards cost of materials.
VII. Sales
Sales are inclusive of excise duty and after deducting VAT and discounts.
VIII. Foreign Currency Transactions:
a) Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the
transaction or that approximates the actual rate at the date of the transaction.
b) Monetary items denominated in foreign currencies at the year end are restated at year end rates, except in cases
covered by forward exchange contracts.
c) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the
profit and loss account.
IX. Export Benefits
Export Benefits in respect of unutilised Advance Licences under DEPB Scheme are accounted for in the year of Export to
the extent of duty leviable on imports to be made in future. The consumption of Raw Material, Stores and other inputs and
the valuation of closing stock are stated net of such export benefits.
NOTE
1
SIGNIFICANT ACCOUNTING POLICIES
NOTE
1
SIGNIFICANT ACCOUNTING POLICIES
(Contd...)
Notes on Accounts
X. Employee Benefits:
a) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss Account
of the year in which the related service is rendered.
b) Gratuity liability has been provided on the basis of actuarial valuation.
XI. Research & Development:
Revenue Expenditure on research and development is charged to Profit & Loss Account in the year in which it is incurred.
Capital Expenditure on research and development is treated as additions to Fixed Assets in case the same qualifies as a
tangible asset as per AS – 10 issued by ICAI.
XII. Provision, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation
as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not
recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial
statements.
XIII.
Dividend received is accounted for as and when it is declared.
XIV.
Unless specifically stated to be otherwise, these policies are consistently followed.
(
`
in million)
31.03.2012
31.03.2011
Equity Share Capital
Authorised
125,000,000 (125,000,000) Equity Shares of par value of
`
2/- each
250.00
250.00
1,000,000 (1,000,000) Preference of Shares of par value of
`
100/- each
100.00
100.00
350.00
350.00
Issued, Subscribed & Paid up
73,583,580 (73,583,580) Equity Shares of par value of
`
2/- each fully paid up in cash
147.17
147.17
147.17
147.17
a) The Company has not issued any shares during the year.
b) The holders of the equity shares are entitled to receive dividends as declared from time to time, and are entitled to voting
rights proportionate to their share holding at the meetings of shareholders.
c) Following Shareholders hold equity shares more than 5% of the total equity shares of the Company at the end of the period :-
Name of Shareholder
No. of Shares % of Shareholding
Kajaria Exports Ltd.
14,703,545
19.98%
Kajaria Securities Pvt. Ltd
6,611,905
8.99%
Pearl Tile Marketing Pvt. Ltd.
5,080,240
6.90%
Cheri Ceramics Pvt. Ltd
5,058,385
6.87%
HSBC Bank (Mauritius) Ltd. A/c Jawalamukhi Investments Holdings
4,780,344
6.50%
Bengal Finance & Investment Pvt. Ltd
4,126,427
5.61%
d) The Company has not issued shares for a consideration other than cash or bonus shares during the immediately preceding
5 years.
NOTE
2
SHARE CAPITAL