Accounting Policies of Kerala Rubber & Reclaims Ltd. Company

Mar 31, 2009

1. Company follows the accrual system of accounting

2. a) Fixed Assets are stated at their original costs less accumulated depreciation written off. Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed under Schedule XIV of the Companies Act, 1956.

b) Vehicles and other fixed assets purchased under deferred payment schemes have been capitalized and grouped under Fixed Assets at their respective invoice values. Aggregate finance charges payable on these hire purchase loans have been teated as Interest sus- pense and grouped under advances, to be amortised to revenue over the period of the deferred credits.

3. Inventories are valued at the following basis.

i) Raw material at cost

ii) Finished goods at cost or market price whichever is less. iii) Loose tools at revalued prices.

4. Employees Benefits:-

a) The Company provides Provident Fund to all employees as a post employment benefit which is defined contribution plan. The annual contribution to Employees Provident Fund Organisation is charged to Profit & Loss Account of the year to which the contribution relates.

b> The Companys annual contribution to state plans, viz. Employees State Insurance Scheme and Employees Pension Scheme are also charged to profit & Loss Account of the Year to which the contribution relates,

c) The company provides for the gratuity liability to the eligible employees as a terminal benefit under the defined benefit plan. The company has opted for a group gratuity cum Life Assurance Scheme of Life Insurance Corporation of India and the annual premium is determined based on actuarial valuation carried out using projected unit credit Method. The premium due for the year is charged to profit & loss accounts.

d) Leave encasement is made in accounts on the assumption that all the eligible employees are retiring on the year end date and is not actuarially valued.

5. Deferred Tax assets & Liabilities arising out of timing difference are recognized to the extent they are capable of being reversed in the subsequent years.