Atul-2012-13

Atul Ltd | Annual Report 2012-13

Notes

to financial statements

NOTE 1 SIGNIFICANT ACCOUNTING POLICIES

General information

Founded by Mr Kasturbhai Lalbhai in 1947, Atul Ltd has emerged, starting with the manufacture of a few dyes, as

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Automobile, Chemical, Composites, Construction, Cosmetics, Defence, Dyestuff, Electrical & Electronics, Flavour &

Fragrance, Glass, Home Care, Paint & Coatings, Paper, Personal Care, Pharmaceutical, Plastic, Polymer, Rubber, Soap &

Detergent, Textile and Tyre. The Company has established subsidiary companies in Brazil, China, Germany, the UK and

the USA to work closely with its customers and expand its business. Its shares are listed on Bombay Stock Exchange

Ltd and National Stock Exchange of India Ltd.

1 Basis of Preparation:

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compliance, in all material aspects, with the generally accepted accounting principles in India, the applicable

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of the Company and other criteria set out in Schedule VI to the Companies Act, 1956. Based on the nature of

products and the time between the acquisition of assets for processing and their realisation in cash and cash

equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current and non-

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2 Use of Estimates:

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Management to make estimates and assumptions that affect the reported amounts of assets and liabilities

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during the reporting period. These estimates are based on the Management evaluation of the relevant facts and

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in subsequent period. Differences are adjusted in subsequent periods as they occur.

3 Fixed Assets:

a) Tangible Assets:

i) Fixed assets other than (ii) and (iii) below are carried at cost of acquisition | construction including

incidental expenses directly attributable to the acquisition | construction activity, as the case may be,

less accumulated depreciation, amortisation and impairment as necessary.

ii) Assets received free of cost on premature cancellation of a lease agreement are valued at fair value.

iii) Freehold land, lease hold land at Panoli and certain business premises have been revalued as per the

report of approved valuer.

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b) Intangible Assets:

Computer software includes Enterprise Resource Planning Project and other cost relating to software which

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4 Depreciation and Amortisation:

Depreciation:

Depreciation on building and plant and equipment is being provided on ‘Straight Line Method’ and on all other

assets on ‘Written Down Value’ basis in accordance with the provisions of Section 205(2)(b) and 205(2) (a) of

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An amount in respect of assets revalued in the past, the depreciation charge over the enhancement to cost is

withdrawn from the revaluation reserves and adjusted against the depreciation charge each year.

Depreciation on additions to the assets during the year is being provided on pro-rata basis at their respective rate

with reference to the month of acquisition | installation.

Depreciation on assets sold, scrapped or discarded during the year is being provided at their respective rates up

to the month in which such assets are sold, scrapped or discarded.