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CourseCode: ACC105 CourseTitle:Financial Accounting

Course Instructor: Dr. Priya

Academic Task No.: 01 Academic Task Title: Assignment 01

Date ofAllotment:15 Feb 2021 Date ofsubmission: 23 Feb 2021

Student’s Rollno: B64 Student’s Reg. no:12010870

EvaluationParameters:(Parametersonwhichstudentistobeevaluated-Tobementionedbystudentsas
specifiedatthetime ofassigningthe taskbythe instructor)

LearningOutcomes:

I have learnt to identify the principle of accounting applied by Hindustan Unilever Limited in their annual
report.

Declaration:

Student’s Signature: Zahid Khan

Evaluator’scomments(For Instructor’s use only)

GeneralObservations Suggestionsfor Improvement Bestpartofassignment

Evaluator‟sSignatureandDate:

Marks Obtained: Max.Marks: …………………………

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Company Profile of PONDY OXIDES.

PONDY OXIDES AND CHEMICALS LIMITED

Website
www.pocl.co.in
Address
KRM Centre, 4th Floor,
2, Harrington Road, Chetpet,
Chennai, Tamil Nadu, 600031
India
Phone
+91-4427666652

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Description
PONDY OXIDES AND CHEMICALS LIMITED is located in Chennai, Tamil Nadu, India and
is part of the Industrial Chemical Manufacturing Industry. PONDY OXIDES AND
CHEMICALS LIMITED has 359 total employees across all of its locations and generates
$169.33 million in sales (USD). There are 10 companies in the PONDY OXIDES AND
CHEMICALS LIMITED corporate family.

Key Principal
ASHISH BANSAL
Industry
Manufacturing Lead pigments: white lead, lead oxides, lead sulfate Lead and zinc Lead and lead
alloy bars, pipe, plates, shapes, etc.
Vision of company:
To create exciting values of innovation to our customer expectations by relentlessly improving
our products and our business efficiencies to achieve exceptional operating performance leading
to market leadership.
We shall make this happen in an enriching environment of trust, cooperation and mutual respect.
 Effectiveness is doing the right things.
 Efficiency is doing things right.
 Bonding together with our customer, we shall move onward and upward.

Mission of the company:

POEL’s corporate value includes co-ordinate measures to create consistent and sustainable
quality standard products through innovation and prudence, complying with the state of the art
technology alongside relevant regulation environment and safety requirements.

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Products of PONDY OXIDES:

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Accounting Period concept:

Pondy Oxides & Chemicals Previous Years »
Standalone Profit & Loss account ------------------- in Rs. Cr. -------------------
Mar 20 Mar 19 Mar 18 Mar 17 Mar 16

12 mths 12 mths 12 mths 12 mths 12 mths

INCOME
Revenue From Operations [Gross] 1,218.45 1,047.23 955.11 817.24 504.95
Less: Excise/Service Tax/Other Levies 0.00 0.00 15.88 58.39 40.45
Revenue From Operations [Net] 1,218.45 1,047.23 939.23 758.85 464.49
Other Operating Revenues 1.42 1.65 0.53 0.09 0.18
Total Operating Revenues 1,219.87 1,048.89 939.75 758.94 464.67
Other Income 3.54 3.99 1.91 1.18 1.08
Total Revenue 1,223.41 1,052.87 941.66 760.12 465.76
EXPENSES
Cost Of Materials Consumed 1,073.82 897.68 829.63 655.77 422.11
Purchase Of Stock-In Trade 27.97 44.60 45.05 21.61 9.98
Changes In Inventories
ies Of FG,WIP And Stock
Stock-
27.08 -10.50 -29.36 -2.35 -14.18
In Trade
Employee Benefit Expenses 19.60 15.05 11.80 7.66 5.79
Finance Costs 9.95 11.22 11.24 8.93 7.58
Depreciation And Amortization Expenses 7.87 5.19 4.30 3.88 3.89
Other Expenses 35.90 37.75 25.02 22.77 14.60
Total Expenses 1,202.19 1,001.00 897.69 718.26 449.75

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Principles of accounting:
Use of Estimates
The preparation of financial statements in conformity with Indian GAAP requires management
to make judgments, estimates and assumptions that affect the reported amount of assets and
liabilities, disclosure relating to contingent liabilities as at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period.
Inventories
Items of inventories are measured at lower of cost and net realizable value after providing for
obsolescence, if any, except in case of by-products which are valued at net realizable value. Cost
of inventories comprises of cost of purchase, cost of conversion and other costs including
manufacturing overheads incurred in bringing them to their respective present location and
condition.
Cost of Purchase
The cost of purchase consists of the purchase price including duties and taxes, freight inwards,
and other expenditure directly attributable to the acquisition. Duties and taxes that are
subsequently recoverable by the enterprise from the taxing authorities are not included in cost of
purchase. Trade discounts, rebates are deducted in determining the cost of purchase and Advance
authorization license/duty scripts on exports and other similar items utilized for import of
materials are not considered in determining the cost of purchase.
Depreciation and Amortization Tangible Assets
Depreciation on Tangible assets is provided to the extent of depreciable amount on Written
Down Value method over the useful lives of assets specified in the Schedule II of the Companies
Act, 2013.
Intangible Assets

Intangible Assets are amortized over their estimated useful life. The estimated useful life of the
intangible assets and the amortization period are reviewed at the end of each financial year and
the amortization method is reviewed to reflect the changed pattern.
Revenue Recognition

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Revenue from sale are recognized on transfer of significant risk & rewards of ownership to the
buyer that usually takes place on dispatch of goods in accordance with the terms of sale and is
inclusive of excise duty but excluding sales returns, trade discount, CST and VAT.
In case of export sales, revenue is recognized as on the date of bill of lading, being the effective
date of transfer of significant risks and rewards to the customer. Export benefits are accounted
for on accrual basis.
Fixed Assets Tangible Fixed Assets
Tangible Assets are stated at cost net of recoverable taxes, trade discounts and rebates and
include amounts added on revaluation, less accumulated depreciation and impairment loss, if
any. The cost of Tangible Assets comprises of its purchase price, borrowing cost and any cost
directly attributable to bringing the asset to its working condition for its intended use, net charges
on foreign exchange contracts and adjustments arising from exchange rate variations attributable
to the assets.
Intangible Assets
Intangible assets comprising of technical know-how, product designs, prototypes etc. either
acquired or internally developed are stated at cost less accumulated amortization and
impairment. In case of internally generated intangible assets, appropriate overheads including
salaries and wages are allocated to the cost of the asset.
Foreign currency transactions
Foreign currency transactions are recorded at the exchange rates prevailing on the date of the
transaction.
Foreign exchange rate fluctuations relating to monetary assets and liabilities are restated at year
end rates or forward cover rates, as applicable. The net loss or gain arising on restatement/
settlement is adjusted to the statement of profit and loss.
Investments

Non-current investments are carried at cost. Provision for diminution in the value of non-current
investments is made only if such a decline is other than temporary in the opinion of the
management.
Current investments are carried at lower of cost and fair value. The comparison of cost and fair
value is done separately in respect of each category of investments

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Employee benefit
All employee benefits payable wholly within twelve months of rendering the service are
classified as short term employee benefits. Benefits such as salaries, wages and bonus, etc, are
recognized in the statement of profit and loss in the period in which the employee renders the
related service.
Defined contribution plans

The employee’s provident fund scheme, employees’ state insurance fund and contribution to
superannuation fund are defined contribution plans. The company’s contribution paid/payable
under these schemes is recognized as an expense in the statement of profit & loss during the
period in which the employee renders the related service.
Defined benefit plans
The Company provides for gratuity, a defined benefit retirement plan (The Gratuity Plan)
covering eligible employees. The Gratuity Plan provides a lump-sum payment to vested
employees at retirement, death, incapacitation or termination of employment, of an amount based
on the respective employee’s salary and the tenure of employment with the Company.
Gains or losses on the curtailment or settlement of any defined benefit plan are recognized when
the curtailment or settlement occurs.
Borrowing Cost
Borrowing costs that are directly attributable to the acquisition or construction of a qualifying
asset are capitalized as a part of the cost of such asset. The qualifying asset is one that
necessarily takes a substantial period of time to get ready for its intended use. All other
borrowing cost is recognized as expense in the period in which they are incurred.
Leasehold land
Leasehold lands are shown at cost less accumulated amortization.

Lease
Asset leased by the company in its capacity as lessee where substantially all the risk and rewards
of ownership vest in the company are classified as finance lease and capitalized at fair value of
the assets or present value of the minimum lease payments at the inception of the lease,
whichever is lower. Lease payments under operating lease are recognized as an expense over the
period of lease on straight line basis in statement of profit and loss account.
Provision for Taxation
Tax expense comprises of current tax (i.e. amount of tax for the period determined in accordance
with the Income Tax Act, 1961) and deferred tax charge or SScredit (reflecting the tax effects of
timing differences between accounting income and taxable income for the period).
Impairment of Assets

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The carrying amounts of assets are reviewed at each Balance Sheet date in accordance with
Accounting Standard - 28 ‘Impairment of Assets’ to determine whether there is any indication of
impairment based on internal / external factors.
An impairment loss is recognized in the statement of Profit & Loss wherever the carrying
amount of an asset exceeds its recoverable amount.
Provisions, Contingent Liabilities and Contingent assets
A provision is created when there is a present obligation as a result of a past event that probably
requires an outflow of resources and a reliable estimate can be made of the amount of the
obligation.
A disclosure for a contingent liability is made when there is a possible obligation or a present
obligation that may, but probably will not, require an outflow of resources. When there is a
possible obligation or a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made.
Cash and cash equivalents
Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term
balances, highly liquid investments with a remaining maturity at the date of three months or less
and that are readily convertible into known amounts of cash and which are subject to
insignificant risk of changes in value.
Derivative accounting
The Company uses derivative financial instruments to manage risks associated with metal price
fluctuations relating to certain highly probable forecasted transactions and certain firm
commitments.
The use of derivative financial instruments is governed by the Company’s policies approved by
the Board of Directors, which provide written principles on the use of such instruments
consistent with the Company’s risk management strategy.