24. CORPORATE INFORMATION & SIGNIFICANT ACCOUNTING POLICIES
A. CORPORATE INFORMATION
ATLAS Jewellery India Limited (referred to as “the Company”) is listed entity incorporated in India. (CIN NO: L74140DL1989PLC131289)
The addresses of its registered office in New Delhi. -110025
B. SIGNIFICANT ACCOUNTING POLICIES
B.1 Basis of Preparation of Financial Statements
The financial statements are prepared under the historical cost conventions on accrual basis in accordance with the Indian Accounting Standards (Ind AS) as prescribed under section of Section 133 of the Companies Act, 2013 and other accounting principles generally accepted in India. Further, the guidance, Notes/Announcements issued by The Institute of Chartered Accountants of India (“ICAI”) are also considered wherever applicable as adopted consistently by the company. The company has uniformly applied the accounting policies during the periods presented.
These are the company’s first Ind AS financial statements and Ind AS 101, First- time of adoption of Indian Accounting Standards has been applied.
Company’s financial statements are presented in Indian Rupees ('), which is also its functional currency.
B.2 Summary of Significant Accounting Policies
a) Property, plant & equipment and Intangible assets
Property, plant and equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable to bringing the assets to its working condition for its intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the assets.
Subsequent costs are included in the asset's carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured reliably.
Depreciation on property, plant and equipment is provided using written down value method. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013
Intangible Assets are stated at cost of acquisition net of recoverable taxes, trade discount and rebates less accumulated amortization/depletion and impairment loss, if any. Intangible Assets are amortized over their respective individual estimated useful life on a Written down Value Method Basis, commencing from date of Assets is available to the company for its use
b) Leasehold assets except land are amortized over the lease term or its useful life, whichever is shorter.
c) Inventories
Items of inventories are measured at lower of cost and net realizable value as prescribed in IND AS 2. Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads net of recoverable taxes incurred in bringing them to their respective present location and condition.
d) Provisions & Contingent Liabilities
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required
to settle the obligation and a reliable estimate can be made of the amount of the obligation. Contingent liabilities are disclosed on the basis of judgment of the management/independent experts. These are reviewed at each balance sheet date and are adjusted to reflect the current management estimate.
e) Employee Benefits Expense
Company’s contribution to Provident Fund and Family Pension Fund are charged to Profit & Loss Account. Gratuity benefits are also paid to employees who have completed 5 years of service with the Company as per Gratuity Rules.
f) Foreign Currency Transactions & Translations
Income and expenses in foreign currencies are recorded at exchange rates prevailing on the date of the transaction. Foreign currency denominated monetary assets and liabilities are translated at the exchange rate prevailing on the balance sheet date and exchange gains and losses arising on settlement and restatement are recognized in the statement of profit and loss.
g) Tax Expenses
The tax expense for the period comprises current and deferred tax. Tax is recognized in Statement of Profit and Loss, except to the extent that it relates to items recognized in the comprehensive income or in equity. In which case, the tax is also recognized in other comprehensive income or equity.
- Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.
- Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit.
h) Revenue recognition
Revenue from sale of goods is recognized when the significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the associated cost can be estimated reliably, there is no continuing effective control or managerial involvement with the goods, and the amount of revenue can be measured reliably. Revenue from sale of goods is measured at the fair value of the consideration received or receivable excluding taxes or duties collected on behalf of the government.
i) Expenses Recognition
Expenses are accounted for on Accrual basis and provision are made for all known Liabilities except ROC fees.
j) Cash Flow Statement
Cash Flow statement is prepared in accordance with the Indirect method prescribed in Indian Accounting Standard (Ind AS)-7 on “Statement of Cash Flows”.
k) Provisions for doubtful debts & advances
Provisions for doubtful debts/ advances is made when there is uncertainty of realization irrespective of the period of its dues and written off when unreliability is established.
l) Earning Per Share (EPS)
Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. The Company did not have any potentially dilutive securities in any of the years presented.
C. FIRST TIME OF ADOPTION OF IND AS
The Company has adopted Ind AS with effect from 1st April 2017 with comparatives being restated. The figures for the previous period have been restated, regrouped and reclassified wherever required to comply with the requirement of Ind AS and Schedule III.
25. NOTES TO FINANCIAL STATEMENTS 25 (1) Overseas Trade Receivables
i) Trade receivables amounting to Rs 135,12,86,431 includes an overseas debtor "M/S Satwa Precious Metals & Bullion Trading (FZE)” of Rs. 1,35,12,71,281 ((Rupees One Hundred Thirty-Five Crores Twelve Lacs Seventy-One Thousand Two Hundred Eighty One Only) (including foreign currency exchange gain or loss) which are outstanding for more than two years, which constitutes more than 85% of company's Total Assets as at the balance sheet date.
ii) The Company has filed a recovery suit against the said party bearing No. [OP No. 7 of 2016 before the Honorable Sub Court, North Paravoor. Kerala for recovery it's entire export dues from the said export debtor.
iii) The export debtor had raised before the Honourable Sub Court the issue of jurisdiction of the said Court to try the matter. The Honourable Sub Court Vide its interim Order dated 4.10.2017 had found no merit in the said contention regarding jurisdiction and answered the same in favour of the Company.
iv) Because of the filing of recovery suits the debt gets classified as legal debtors. Sincethe matter is under judicial review the company has not created any provision as per the requirement of Ind AS 109, Financial instruments under the Expected Credit Loss model.
v) The Company has also filed an extension application for the over—due export invoices with Axis Bank (AD Banker) on 16.12.2017 as per RBI Master Circular. The same is awaiting RBI approval as per letter received from the said banker.
25 (2) Balances of Trade receivables, Trade payables, Loans & advances, Current assets & Current liabilities are subject to confirmation and consequential adjustments thereof as on balance sheet date.
25 (3) The company has outstanding loans & advance of Rs 85,34,000 (Eighty-Five Lacs Thirty-Four Thousand only) & Rs 20,00,000 (Rupees Twenty Lacs only) from lndorient Financial Services Limited (lFSL) and Carnation Commodities Private Limited (CCPL). The company is reasonably confident of recovering the amounts and hence has not made any provisions.
25(4) The company has booked Rs 27,73,395 (Previous year 1,81,13747) as loss of Property, Plants & Equipment’s (leasehold improvements) due to termination of leave and license agreement for it showroom premises at Vashi, Navi Mumbai and shifting of New Delhi registered office.
25(5) The Company had received notice from Directorate of Enforcement regarding the clarification of export proceeds pending from overseas debtors. The same has been duly answered by the Company.
25(6) There was a complaint filed in “Economic Offence Wing (EOW)” against the company and its promoters by Commercial Bank of Dubai (Complainant) in the preceding year. The complainant has mixed up issues and tried to bring a private arrangement between the Complainant and the promoter which had purportedly taken place sometime in April 2013 in United Arab Emirates (U.A.E) to India and made our Company, as parties to the complaint. The Company is no way connected to the alleged transaction nor concerned with the same or has been aware ofthe same till the complaint was lodged, However, the Company as a law-abiding citizen had provided all the necessary information as being sought from it by the investigating officer.
25 (7) The company has written off various outstanding debt balances of Rs. 10,26,259 and credit balances of Rs. 1,27,33,730 through a single ledger of profit and loss adjustment account after management confirmation for such adjustments.
i. There are certain items of expenses and income which are being carried forward in our books of accounts for more than 3 years now. These amounts are materially not significant and the settlement of the same does not seem possible now and hence the same are either being written off or written back.
ii. The items related to past employees of the company and vendor accounts and there has been no claim from their side in the above-mentioned period.
iii. This also includes certain vendors payable account which is not being fully written back as the matter is still under discussion, however partly write-back has been done based on discussions with the vendors concerned.
iv. There are certain income tax TDS receivables amounting to Rs.5.26 lacs related to assessment years 2009 to 2014 and the same is being written-off as assessment orders for the said years have been concluded.
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