Company Overview Financial Statements Notice Statutory Reports 45 Rudolf Atul Chemicals Ltd | Annual Report 2019-20 Notes to the Financial Statements Background Rudolf Atul Chemicals Ltd (the Company) is a limited company incorporated and domiciled in India. It is a joint venture company of Rudolf GmbH and Atul Ltd, engaged in manufacturing and marketing of textile chemicals in India. The Company is effectively leveraging the strengths of Rudolf GmbH and Atul Ltd in serving its customers by becoming a total solution provider and is thereby helping the two partners to participate in the growing marketplace. The registered office of the Company is located at B | 18598, Survey number 33, Atul 396 020, Gujarat, India. Note 1 Significant accounting policies This Note provides a list of the significant accounting policies adopted by the Company in the preparation of these Financial Statements. These policies have been consistently applied to all the years presented, unless otherwise stated. a) Basis of preparation: i) Compliance with Ind AS: The Financial Statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act ) read with [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act as amended. ii) Historical cost convention: The Financial Statements have been prepared on a historical cost basis except for the following: a) Certain financial assets and liabilities: measured at fair value b) Defined benefit plans: plan assets measured at fair value All the assets and liabilities have been classified as current or non-current as per the normal operating cycle of the Company and other criteria set out in Schedule III to the Companies Act, 2013. 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 12months for the purpose of current and non-current classification of assets and liabilities. iii) The Financial Statements have been prepared on accrual and going concern basis. b) Property, plant and equipment: Property, plant and equipment 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 as per cost model. Depreciation: i) Depreciation is being provided on a pro-rata basis on the ‘straight-line method’ over the estimated useful lives of the assets. ii) Depreciation is calculated on a pro-rata basis from the date of acquisition | installation till the date the assets are sold or disposed off. iii) Useful lives of the assets as prescribed under part C of Schedule II to the Companies Act, 2013 are applied. iv) The property, plant and equipment acquired under finance leases is depreciated over the assets’ useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the group will obtain ownership at the end of the lease term. v) The residual values are not more than 5% of the original cost of the asset. The assets’ residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period. c) Intangible assets: Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortisation and impairment.
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