Accounting Policies of Rukmani Devi Garg Agro Impex Ltd. Company

Mar 31, 2024

II. SIGNIFICANT ACCOUNTING POLICIES:

1. Basis of Preparation of Financial Statements:

The Financial Statements have been prepared to comply in all material aspects with applicable
Accounting Principles in India, the applicable Accounting Standards prescribed under section 133 of
the Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules 2014, the provisions of
the Act (to the extent notified) and other Accounting Principles generally accepted in India, to the
extent applicable.

The company presents assets and liabilities in the balance sheet based on current/ non- current
classification based on operating cycle. The operating cycle is the time between the acquisition of
assets for processing and their realisation in cash and cash equivalents. The company has identified
twelve months as its operating cycle.

2. Inventories (AS-2):

Inventories are valued at Cost or Net Realisable Value whichever is lower. Cost comprise of all cost
of purchase, cost of conversion and other cost in bringing the inventory to their present location and
condition. The Cost formula used is First in First Out (FIFO).

3. Cash and Cash Equivalents (Cash Flow Statements - AS-3)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short — term
balances (with an original maturity of three months or less from the date of acquisition), highly liquid
investments that are readily convertible into known amounts of cash and which are subject to
insignificant risk of changes in value.

Cash flows are reported using Indirect method, where by profit/ (loss) before extraordinary item and
tax is adjusted for the effect of transactions of non-cash nature and deferrals or accruals of past and
future cash receipts or payment. The cash flow from operating, Investing and financing activities of
the companies are segregated based on the available information.

4. Revenue (AS-9):

Sale of Goods and Services

They are generally accounted for on accrual basis as they are earned or incurred, revenue is
recognised only when can be reliably measured and it is reasonable to expect ultimate collection.
Revenue from contract priced on time and material basis are recognised when services are rendered
and other costs are incurred.

Other Income

Interest and Other Income is accounted on accrual basis.

The Fixed Assets are stated at cost of acquisition less accumulated Depreciation and impairment
losses, if any. The cost includes taxes and duties, freight, installation and other direct or allocated
expenses. Consequently depreciation on such assets is provided according to useful life prescribed
under the schedule II for “Continuous Process Plant” under Written down Value Method.
Depreciation on other assets is provided on Written down Value Method in accordance with the
provisions of the Companies Act, 2013 at the rates and in the manner specified in Schedule 11 of the

Act except intangible assets.

Machinery spares which can be used only in connection with items of fixed assets and whose use
expected to be irregular are capitalised and depreciated over the useful life of the principal item of the
relevant assets. Subsequent expenditure relating to fixed assets is capitalised only if such expenditure
results in an increase in the future benefits from such assets beyond its previously assessed standard of
performance. There is no Capital Work In Progress for the financial year ended March 31 , 2024.

6. Investments (AS-13):

(i) Investments, which are readily realisable and intended to be held for not more than one year
from the date on which such investments are made, are classified as current investments. A
investments are usually measured at cost.

(ii) Current investments are carried in the financial statements at lower of the cost and fair
value determined on an individual investment basis. Long term investments are carried at cost.

7. Employees Benefits (AS-15):

_ Short Term Employees Benefits: - Short term employee benefits are recognized as an expense at the
undiscounted amount in the profit and loss account of the year in which the related service is

rendered.

- Post-Employment Benefits:- Employees Benefits in the form of contribution towards Provident
fund, ESI are considered as defined contribution plan and the contributions to recognized funds are
changed to the Profit and loss account of the year when the contributions are due, as per the

provisions of respective statutes.

_ Other Lone Term Employees Benefits:- Leaves lying in credit of the employees are not paid as the
company follows practice of granting leaves as and when demanded by the employees during the
year otherwise the same gets lapsed. Hence, no provision for the same is required to be made.

8. Borrowing cost (AS-I6):

Borrowing costs which are attributable to acquisition/ construction of qualifying assets are capitalised
as a part of the cost of such assets till the date of putting such assets to use. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing
costs are recognised as an expense in the period in which they are incurred.

9. Earnings per Share (AS-20):

Basic & Diluted Earnings per Share are computed in accordance with AS-20 on
‘Earning per Share''. Basic EPS is calculated by dividing the net profit or loss after tax for the year
attributable to equity shareholders by the weighted average number of equity shares outstanding
during the year Diluted Earnings per Equity Share are computed using the weighted average number
of equity shares and dilutive potential equity shares outstanding during the year, except where

results are anti-dilutive.

Current tax is the amount of tax payable on the taxable income for the year as determined in
accordance with the provision of Income Tax Act, 1961.

Deferred tax is recognised on timing difference, being the difference between the taxable income and
the accounting income that originate in one period and are capable of reversal in one or more
subsequent periods. Deferred tax is measured using the tax rates and tax laws enacted or substantially

enacted as at the reporting date.

Deferred tax liabilities are recognised for all timing difference. Deferred tax assets in respect of
unabsorbed depreciation and carry forward of losses are recognised only it there is virtual certainty
that there will be sufficient future taxable income available to realise such assets.

Deferred tax assets are recognised for timing difference of other items only to extent that reasonable
certainty exists that sufficient future taxable income will be available against which these can be
realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by
the same governing are tax laws and the company has legally enforceable right for such set off.
Deferred tax assets are reviewed at each Balance Sheet date tor their reliability.

11. Intangible Assets (AS-26):

The company amortises the intangible assets over their estimated useful lives on the straight line
basis commencing from the date of asset is available to the company for its use. Further, the company
assesses at each balance sheet date, the probability of future economic benefits using reasonable and
supportable assumptions that represent the best estimate of the set economic conditions that will exist
over the useful life of the asset and amortizes the amount of asset accordingly.

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12. Impairment of Assets (AS-28):

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value.

The Company assesses at each balance sheet date, whether there is any indication that an asset may be
impaired If any such indication exists, the company estimates the recoverable amount of the assets. If
such recoverable amount of the assets or recoverable amount of the cash generating unit to which
assets belong is less than its carrying amount, the carrying amount reduced to its recoverable amount
The reduction is treated as an impairment loss and is recognised in Profit and Loss account, if at
Balance sheet date there is an indication that if a previously assessed impairment loss no longer exists,
the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a

maximum of depreciated historical cost.