Amal Ltd 2015-16

Amal Ltd | Annual Report 2015-16 Notes to the Financial Statements iii. Exchange differences: All exchange differences arising on settlement and conversion of foreign currency transactions are included in the Statement of Profit and Loss. 11. Revenue recognition: i. Sale of Goods: Revenue is recognised when the significant risks and rewards of ownership of goods have passed to the buyer, which generally coincides with delivery. It includes excise duty but excludes value added tax and sales tax. Service income is recognised net of service tax when the related services are rendered. ii. Lease rental income is recognised on accrual basis. iii. Dividend income is accounted for in the year in which the right to receive the same is established. iv. Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. 12. Provisions, contingent liabilities and contingent assets: A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on Management estimate required to settle the obligation at the Balance Sheet date and adjusted to reflect the current Management estimates. No provision is recognised for – i. Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company; or ii. Any present obligation that arises from past events but is not recognised because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or a reliable estimate of the amount of obligation cannot be made. iii. Such obligations are recorded as contingent liabilities. These are assessed continually and only that part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimate can be made. iv. Contingent assets are not recognised in the financial statements since this may result in the recognition of income that may never be realised. 13. Employee benefits: i. Defined contribution plan: Contribution paid | payable by the Company during the period to Provident Fund, Employees’ Deposit Link Insurance Scheme, Officer Super Annuation Fund, Employees’ State Insurance Corporation, and Labour Welfare Fund are recognised in the Statement of Profit and Loss. ii. Defined benefit plan: Gratuity: Gratuity liability is defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of each financial year. The liability so provided is Note 1 Significant Accounting Policies (continued)