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Analysis of financial statement of asianpaints ltd

AS-1 DISCLOSURE OF ACCOUNTING POLICIES

Disclosure of accounting policies means enclosure all the changes of accounting


policies in current year of your books of account. The financial statements have been
prepared in accordance with Generally Accepted Accounting Principles (GAAP) in India
and presented under the historical cost convention on accrual basis of accounting to
comply with the accounting standards prescribed in the Companies (Accounting
Standards) Rules, 2006 and with the relevant provisions of the Companies Act, 1956.
The preparation of financial statements in conformity with Generally Accepted

Accounting Principles (GAAP) in India requires management to make estimates and


assumptions that affect the reported amounts of assets and liabilities and the
disclosures of contingent liabilities on the date of financial statements and reported
amounts of income and expenses during the period. ,

AS-2 ACCOUNTING FOR INVENTORIES

In determining cost of raw materials income and expenses during the period. ,
packing materials, stock-in-trade, stores, spares, components and consumables,
asianpaints maintained the weighted average method to find out inventories and
maintain it properly.

AS-3 ACCOUNTING FOR CASH FLOW

In asianpaints operating activities are recorded in indirect basis ,the cash inflow from the
operating activities are 826.37 which is more than 7% of previous year inflow i.e
762.46. in asianpaints more money spend in investing activities i.e 512.13 the previous
year investment is (440.40). cash flow from financing activities in asianpaints is (326.21)
that means money spend in providing dividend .total cash flow of asianpaints including
all three activities is 624.31 ,the cash inflow from foreign exchange is 10.35 and cash
in hand in current year is 626.23.

AS- 4 CONTINGENCIES AND EVENT OCCURRING AFTER BALANCE SHEET DATE

This accounting standard are not applied in this company

AS-5 NET PROFIT OR LOSS FOR THE PERIOD,PRIOR PERIOD ITEM AND
CHANGES IN ACCOUNTING POLICIES
AS-6 ACCOUNTING FOR DEPRECIATION

Depreciation on all fixed assets is provided under Straight Line Method. The rates of
depreciation prescribed in Schedule XIV to the Companies Act

Information Technology Assets : 4 years


Scientific Research equipment : 8 years
Furniture and Fixtures : 8 years
Office equipment and Vehicles : 5 years
Godowns, Office and Roads situated within factory premises : 30 years

For Phthalic Anhydride and Pentaerythritol plants, depreciation is provided on all eligible
plant and machinery at rates applicable for continuous process plants and for other
plant and equipment depreciation is provided on triple shift basis.

AS-7 ACCOUNTING FOR CONSTRACTION CONTRACT

It is a painting color production company ,so as-7 is not applicable .

AS-8 ACCOUNTING FOR R&D(withdraw from accounting standard)

AS-9 REVENUE RECOGNITION

Revenue from sale of goods is recognized to transferring all risk and reward ownership
to buyer .revenue is including with sales taxes/vat and net rate of return. Revenue of
service is recognized on rendering service to customer. Process income is finding out
through the accrual basis. Interest income is recognized on the time proportion basis.
Dividend income is recognized when right to receive payment established.

AS-10 ACCOUNTING FOR FIXED ASSET

Cost of fixed asset include taxes , duties ,fright and other direct expenses related with
fixed asset

AS-11 EFFECT OF CHANGES IN FOREX EXCHANGE RATE

Transactions in foreign currencies entered into by the Company are accounted at the
exchange rates prevailing on the date of the transaction. This year total foreign gain of
asian paints is 42.25

AS-12 ACCOUNTING FOR GOVT GRANTS


There is no grant provided by govt. to asianpaints ltd .
AS-13 ACCOUNTING FOR INVESTMENT

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.On disposal
of an investment, the difference between its carrying amount and net disposal proceeds
is charged or credited to the Statement of Profit and Loss. Profit or loss on sale of
investments is determined on a first-in-first-out (FIFO) basis.

AS-14 ACCOUNTING FOR AMALGAMETION

Asian paints are not acquired any company .so this as-14 is not applicable.
AS-15 EMPLOYEESE BENIFITES

employees benefit of this company is divided in to two main part a) short term
employees benefits and b) post employees benefits. Short term benefits means benefits
provided to employees with twelve month. Post employees benefits means benefits
provided to employees in life time basis..
asianpaint provided to his/her employees the following -------

1)Provident Fund scheme

2)Gratuity scheme

3)Pension scheme

4)Post Retirement Medical benefit plan

Total employees benefits of asianpaints is 341.63 ,it is more than the previous year
expenses i.e 300.45

AS-16 BORROWING COST

Borrowing cost includes Interest, amortization of ancillary costs incurred in connection


with the arrangement of borrowings and exchange differences arising from foreign
currency borrowings to the extent they are regarded as an adjustment to the interest
cost. Borrowing costs, if any, directly attributable to the acquisition, construction or
production of an asset that necessarily takes a substantial period of time to get ready for
its intended use or sale are capitalized. There are two type of borrowing cost long term
and short term. Long term borrowing of asian paints of this year is 52.64crores and
short term borrowing cost is 110.51crores which is more than the previous year ,but
long term borrowing cost is decrease from 57.71 to 52.64 crores.

AS-17 SEGMENT REPORTING


AS-18 RELATED PATIES DISCLOSES
The following paties are involved in asianpaints ltd.

Asian Paints (Nepal) Private Limited

Asian Paints (International) Limited Mauritius

Asian Paints Industrial Coatings Limited India

Multifacet Infrastructure (India) Limited India

Maxbhumi Developers Limited India

AP Coatings Limited India

AS-19 ACCOUNTING FOR LEASEES


Lease rentals on assets taken on operating lease are recognized as expense in the
Statement of Profit and Loss on an accrual basis over the lease term .this year lease
expenses of asian paints is 0.20 crores.The Company has provided tinting systems to
its dealers on an operating lease basis. The lease period varies between four and ten
years. Lease rentals are payable monthly by the dealers. A refundable security deposit
is collected at the time of signing the agreement.

AS-20 EARNING PER SHARE

The Basic and Diluted Earnings Per Share (EPS) is computed by dividing the net profit
after tax for the year by weighted average number of equity shares outstanding during
the year . so basic eps of this year rs 99.92 and diluted eps is rs 80.81 on face value of
10 rupees

AS-21 CONSOLIDATED BALANCESHEET

AS-22 ACCOUNTING FOR TAXES AND INCOME

Current year p.year$


Current Tax 402.76 324.99
Deferred Tax 5 4.16 26.41
(Excess) tax provision for earlier years (2.38) (4.22)
Total Tax Expenses 404.54 347.18

AS-23 ACCOUNTING FOR INVESTMENT IN ASSOCIATES CFS

The following are the associate company which holding by the asian paints

Asian Paints (SouthPacific) Limited of Fiji Islands, 53.15% share hold


by asianpaints, previous year is (51.30%) 1st April, 2011 31st March,
2012

Asian Paints (Tonga)Limited Kingdom ofTonga ,100.00% share hold by


asianpaints, (100.00%) 1st April, 2011 31st March, 2012

Asian Paints (S.I.) Limited Solomon Islands 75.00% share hold by


asianpaints same as previous year, (75.00%) 1st April, 2011 31st
March, 2012

Asian Paints (Vanuatu) Limited Republic of Vanuatu 60.00% share hold


by same as previous year asianpaints(60.00%) 1st April, 2011 31st
March, 2012

Asian Paints (Lanka) Limited Sri Lanka 99.18% share hold by


asianpaints decrease by .68% (98.86%) 1st April, 2011 31st March,
2012

Asian Paints (Bangladesh) Limited Bangladesh 89.78% share hold by


asianpaints, (89.78%) 1st April, 2011 31st March, 2012

Asian Paints (MiddleEast) LLC Sultanate of Oman 49.00% share hold by


asianpaints, (49.00%) 1st April, 2011 31st March, 2012

SCIB Chemicals S.A.E. Egypt 60.00% share hold by asianpaints same


as previous year, (60.00%) 1st April, 2011 31st March, 2012

Samoa Paints Limited Samoa 80.00% share hold by asianpaints same


as previous year, 80.00% 1st April, 2011 31st March, 2012

AS-24 DISCOUNTINUING OPERATIONS


AS-25 ACCOUNTING FOR INTRIM FINANCIAL REPORTING

AS-26 INTANGIBLE ASSET

AS-27 ACCOUNTING FOR INTEREST IN JOINT VENTURE


Financial Reporting of Interests in Joint Venture, the disclosures relating to the two Joint
Ventures viz., Asian PPG Industries Limited and Asian Ppg Ltd.(bothhereinafterreferred
to as JV) are as follows: The proportion of interest of the Company in the JV is by way
of equal equity participation with PPG Industries Securities Inc., U.S.A.

AS-28 IMPAIRMENT OF ASSET

AS-29 PROVISION,CONTINIGENT LIABILITIES AND ASSET