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MBH is the flag ship company doing business of Iron Ore mining in Goa. VMSB has
14 leases across three mines in Goa at Velguem, Sigao, and Sacordem. It has Three
Divisions Shipping, Mumbai & Delhi. It owns Transhipper vessel M.V.Vishal Hira
which is used for Loading its cargo.
GMPL is a Private Limited Company incorporated under the Companies Act 1956 on
21-12-1982. It operates at Cudnem mine as Ore Raising Contractor for KRG
S. V. Salgaocar ( HUF ) is Hindu undivided family it has two Barges M.V. Vishal
Niharika & M.V. Vishal Ranjana.
TMPL is a Private Limited Company incorporated under the Companies Act 1956 on
13.12.2004. It has mining lease at Sondenahalli Village C.N Halli Taluka. Tumkur
Karnataka.
AS IS Document
Mahadhan Real Estates LLP., (erstwhile Mahadhan Real Estates Pvt. Ltd.,) is a Limited
Liability Partnership Firm bearing LLP identity No. AAB-2159, registered under
Limited Liability Partnership Act, 2008 on 15th November, 2012. Its main businesses
are Construction, development, & improvement of land and/or building and Renting of
buildings.
Castle Rock Tourist Resort Pvt. Ltd.is a Private Limited Company incorporated under
the Companies Act 1956 on 1st September 1983.
Kushavati Mining Pvt. Ltd. Ltd is a Private Limited Company incorporated under the
Companies Act 1956 on 5th September 1991.
Amona Infrastructure Pvt. Ltd. is a Private Limited Company incorporated under the
Companies Act 1956 on 24th April 2008. It has investment in Land property
Salgaocar Metals & Minerals Pvt. Ltd. is a Private Limited Company incorporated
under the Companies Act 1956 on 7th May 1993.
Zantye & Company Pvt. Ltd is a Private Limited Company incorporated under the
Companies Act 1956 on 14th May 1964. The company has Mining Lease in Sarvona
Bicholim Goa. Presently there are no activities carried out.
Salgaocar Minerals & Ores Pvt. Ltd is a Private Limited Company incorporated under
the Companies Act 1956 on 7th May 1993.
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AS IS Document
2 MASTER DATA
3 GL ACCOUNTING PROCESS
1 = Assets
3 = Liability
6 = Expenditure
7 = Revenue
3.2 CURRENCY
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o Cash Books
o Bank Books
o Iron Ore Purchases Register
o Truck Freight Register
o TDS register
o General Journal
o Expense Journal
o Credit Note Register (Purchases )
o Civil Contractors
o Bill Register (Sales)
o Credit Note Register (Sales)
o Imprest Cash Journal
o Stores & Spares Purchases Register
o Iron Ore Sales Register
o Miscellaneous Sales Register
o Fixed Assets Register
o General Ledger
o Subsidiary Ledger
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6 Vehicles 1108
7 Other Equipments 1109
8 Bridges, Roads, & Jetties 1110
9 Barges, Lcts& Launches 1111
10 M. V. Vishal Hira 1112
11 Electrical Equipments 1115
12 Boats / Ships 1116
13 Lease Hold Land & Buildings 1117
14 Goodwill 1118
15 Mining Rights 1119
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VMSB has mining leases at Velguem, Sigao and Sacordem. Presently only
velguem Mine is operational.
Payment of Royalty & Contribution to funds has to be made before
transportation of Iron ore from Leases.
Mining department gives estimated quantity, type of ore & grade to be
transported to Export Department.
Based on the request of Mining Department Export Department calculates the
royalty & other contributions payable to funds.
Royalty is calculated based on the latest IBM sale value available. Generally
the IBM rates are published after 2-3 months.
After making calculation as above the export Department raises the requisition
for payment which is approved by CMD.
On receipt of requisition from Export Dept. the payments are processed by
accounts department.
After the payments are processed Export Department writes a letter to DMG
for obtaining Royalty & Transit permit challan.
Application to issue Transit permit is made to DMG.
On receipt of Transit permit it is associated with weighbridge.
Transportation of ore will commence against the transit permit. Each truck
will be issued trip sheets.
Details of transportation of ore showing actual quantity, type of ore & grade is
received by export department.
Once the actual quantity, grade and IBM sale value of a particular month are
available the reconciliation of royalty is done.
Difference if any towards Royalty or contribution to funds is paid or adjusted
as the case may be.
Royalty.xlsx
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AS IS Document
Invoices sent by the respective Departments are verified against Contract / Work
Order/Purchase Order as the case may be. In some cases the bills are without work
orders. In all the cases approvals for payments are checked.
Under Transaction code – 314 Civil Jobs bills are accounted.
Under Transaction code – 311 Expense bills are accounted
Under Transaction code - 310 Journal Vouchers are accounted.
Invoices are accounted in FAS against the Bill Forwarding Memo reference.
TDS as applicable are deducted while accounting the Invoices. TDS amount is picked
in the TDS register automatically after the PV is confirmed.
Advances if any given are adjusted in Advance adjustment screen
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Bank Remittance is prepared after confirming PV where in the TDS & other
recoveries like P. F., LBWF, Retention (if any) are made. Thereafter the remittance is
sent to Cash section for drawing payment.
Payment documents are confirmed by the Cash Section.
4.6 Invoices without Purchase Order/Work Order/Rate
Contracts:
Entries in the TDS register are automatically captured from PV or Bank remittance
Screen and in case of TMS from JV screen.
For Mumbai & Delhi division the entries are manually entered.
TDS register is processed at the end of the month.
After processing the TDS register JV is created by Debiting Party’s account &
crediting respective TDS Payable account.
The TDS remittance is generated, and payment is made through net banking.
The TDS process in the SAP system can be divided into the following steps:
Down Payment
Invoice Receipt
Down payment clearing
Provisions at period end
Reversal of provisions on first day of next month
WHT Receipt print
TDS will be deducted at source at the time of payment or Invoice whichever is first.
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AS IS Document
At the time of Advance / down payment the total amount of payment inclusive of TDS
payable debits the vendor accounts. A sample accounting entry follows:
We have one main cashier, Four travelling cashiers & Twenty Eight Imprest Holders.
Travelling cashiers are used for withdrawing cash from Bank, Disbursement of
payments at mines & also as a replacement in absence of main cashier.
Cash of 36 companies are maintained in cash section.
Minimum balance for VMSB is Rs 1,00,000/-, and for other group companies, the
balance is maintained as per the individual companies requirements.
The cash withdrawal is done as per cash requirement. There is no frequency for cash
withdrawal.
The cash withdrawal date is informed to all concerned sections, accordingly selves
cheques are drawn by respect sections and given to main cashier, Main Cashier enter
all selves cheques on register & put up for signature of authorized signatories. After
obtaining Signature, Travelling Cashier withdraws cash from Bank.
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AS IS Document
Travelling cashier goes to mines location in the second week of every month.
Cashier carries cash to be disburse along with Cash Remittance Advices &
Cash Receipt copies.
Cash along with Cash Remittance advices & Cash Receipt copies are given to
Mines cashier of each location.
Cash counting is done on first day of each month before making any cash transaction.
Surprised cash counting is also done as and when required.
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As per instruction of Finance Dept. Fixed Deposits are kept with Bank.
Instruction to Bank for placement of deposits given through letter.
Tenure & Rate of deposit is negotiated by Finance Dept. with banks
and intimated to accounts department.
Fixed Deposit report is kept in Excel
Tracking of maturity date of Deposit is done Manually.
TDS & Interest earned on deposits are accounted on the basis of Bank
advices.
TDS certificates are obtained Quarterly from Banks .
Some Fixed deposits are lien with Bank as a 100 % margin money against
Bank Guarantees, Import LC
6.13 PAYMENT
Bank remittances are received from Bill section, Pay roll Section &
Investment section
Mode of payment is instructed by respective section.
Generally payments are made through cheques, DD, RTGS /NEFT or
through letter ,
Net Banking facility to transact online payment of direct & indirect
Taxes, PF, Custom Duty, DGFT Application & License.
In case of VMSB Cheques are printed on Printer.
Cheques are signed jointly by any two of Authorized Signatories
Bank Payment vouchers are accounted on same day
Day end all signed cheques are sent to CMD for Approval
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AS IS Document
FAS generate Cheque delivery report based on the input provided at the time
of payment voucher confirmation. Same is used to dispatch cheque to various
departments.
6.15 Receipt
Mutual Fund : is accounted on redemption of Mutual Fund.
Export bill is send for collection though our Bank. It take about 15 days to
realise, on realisation of Export Invoice the funds are either converted in
Indian rupees or are Parked in EEFC account as per instructions of Finance
Department. The realisation of export invoice is accounted on base of letter
issued by finance dept. to the banker.
Demurrage
Foreign Sampling Charges
Purchase of spares
Foreign Subscription
Overdrawn export Invoice
P & I insurance
Import LC
Freight Charges
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AS IS Document
Finance Dept forwards to Cash section request letter of Bank Guarantees for
Signature of Authorised person. After Verifying, the Signed letter is return back to
Finance Dept
Fixed deposits are lien with Bank as a 100 % margin money against Bank guarantees
Cash section keep the record of Bank Guarantees in excel
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AS IS Document
Upon receipt of documents in compliance with the terms and conditions of the LC,
9. HDFC Bank Ltd., Vasco 00722000003489 Current A/c
the issuing bank effect payment.
In some cases, issuing bank may raise discrepancies in documents.
GL account effecting the effect the LC and Bank Charges
1 Cheque Receipts
Dr. Bank XXXX
Cr. Party XXXX
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AS IS Document
Once the Vessel is sailed Provisional Export Sales Invoice for 100% of
shipment value is raised, it is stated in the invoice that 95% provisional
Invoice value has to be paid by party and the balance 5% is to be settled by the
party on final analysis report at destination port.
After receiving the 95% Sales proceeds through our bank we account the
proceeds by crediting to party. The exchange difference arising on account of
95% invoice value and receipt value transferred to exchange difference -
Export A/c.
When vessel reaches the destination port, ore analysis is done by the party and
reports are send to us to raise the final invoice. Final Invoice is raised with
100% value, Less the 95% Provisional invoice value balance receivable /
payable to party.
Accounting treatment to final invoices, we reverse the 5% value which is
accounted as per Provisional Invoice (The entry will be Credit to Party
and Debit to Export sales - Income,) and then Final Invoice is accounted on
exchange rate as on date of Bill of Lading.
After receiving the 5% Final Invoice proceeds through the bank the exchange
difference is transferred to Exchange difference - Export A/c.
Year end if any Provisional or Final Invoice is raised but not realised, we re-
state the Invoice value as at 31st March exchange rate.
From 01-04-2017 onward all Export Sales of I/Ore Shipments are on CFR FO
Basis (Cost Freight Free Out). Wherein Ocean Freight is incurred by the
company and debited to expenses.
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After receiving 95% sale proceeds through our bank from party we accounts
the proceeds (only 95% realised in INR) the entries:
On receipt of destination report the export dept raises the final Invoice,
following entries are passed. The 5% accounted as per Provisional invoice
now being reversed.
After receiving final invoice proceeds through our bank from party we
accounts the proceeds (5% realised) the entries:
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AS IS Document
In case of contract where the rates are provisional and final rates are to
determine based on the index price of the month on arrive at destination port.
In such cases many a times the final invoice is negative wherein we have to
pay party by raising a credit note.
Note:
Base on Export Sales inputs the various Export related report are being
prepared for our various requirement (Format attached) Copy of Provisional
And Final Invoice is attached. (All Accounting entries in our Books are in
Indian Rupees)
GST not applicable for Export Sale of I/Ore
Export Duty is not applicable for grade below 58%
From 01-04-2017 onward all Export Sales of I/Ore Shipments are on CFR FO
Basis (Cost Freight Free Out)
Sales of Iron ore to local customers base on the terms and condition of
contract. Invoice is being raised by Export Dept
Note:
All Local sale of Iron Ore are in Indian Rupees
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AS IS Document
Note :
The Bill raised at TMS Module and Req. in FAS along with hard copy of signed
(Copy of Bill is Enclosed)
GST is not applicable if the value of per trip is below R.1500/-
Company’s Jetties are given on hire to third parties at an agreed rates, many a times the
composite provided which includes Jetty Hire, Barge Hire and Truck Transportation where
the rates are fixed The bills are raised by Export Dept.
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AS IS Document
The Company does not own any barges however in case of composite services wherein the
company services to third parties, barges are hired by company from group entities for said
services. The rate Bill is being raised by our Export Dept.
Note : The Barge Freight rate is as per Goa Mineral Ore Exporters Association
Tran shipper Vishal Hira is used for Loading Foreign going Vessels given to VMSSI
and outside parties as per the agreed rate. The Export Dept. raises the bill.
The Accounting Entry :
Note : Tran shipper Income booked by Shipping Division GST paid by H.O.
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AS IS Document
Company provides Manpower to Group companies for which billing is done on monthly
basis.
Bill is being raised by applying applicable GST
7.7 Other Income :
VMSB Flats/Houses given on Rent, every month Bills are raised as per the
agreement. In case of renting premises GST as applicable is charged.
Accounting Entry
HSD, Stores & Spares parts are sold to scheme Trucks and Contractors and group
Companies based from Inventory dept. Necessary Invoice are raised by applying
applicable taxes.
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AS IS Document
Services of GTA attract GST at either 5% or 12%. The liability to pay GST devolves
on the recipients of such GTA Services.
The rate of 5% is subject to the condition that credit of Input Tax charged on goods or
services used in supplying the service has not been taken. If Input Tax credit is to be
availed, then the GST rate would be 12%.
The services provided by individual transporters who do not issue a consignment note
are exempted from GST.
Consideration charged for the transportation of goods on a consignment transported in
a single carriage are exempt, if it does not exceed Rs 1,500/-.
Consideration charged for the transportation of all such goods for a single consignee
are exempt if it does not exceed Rs 750/-
Any intermediate/ ancillary service provided in relation to transportation, like loading
/ unloading, packing/ unpacking, trans-shipment, temporary warehousing, etc. are also
covered under GTAIf these services are not provided as independent activities.
Reverse charge means the liability to pay tax is on the recipient of supply of goods or
services.
There are two types of reverse charge categories. First is dependent on the nature of
supply and the Second is dependent on the taxable supplies by any unregistered
person to a registered person.
The first category of services includes Legal Services, Sponsorship Services, Services
received from Govt., Services provided by a Director (not being an employee) etc.
The second category includes all supplies of goods and services received from GST
unregistered dealers.
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AS IS Document
The rates of GST applicable to the above mentioned services are as follows:
Sl. Particulars SGST CGST IGST
No
1 GTA Services – 5% 2.5% 2.5% 5%
2 Legal Services – 18% 9% 9% 18%
Any registered person can avail credit of tax paid on the inward supply of goods or
services or both, which is used or intended to be used in the course or furtherance of
business.
Goods and/or services provided in relation to food and beverages, outdoor catering, health
services, Membership of a club, health and fitness centre; Rent-a-cab, life insurance,
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AS IS Document
health insurance except where it is obligatory for an employer under any law and Travel
benefits extended to employees on vacation such as leave or home travel concession;
Works contract services when supplied for construction of immovable property, other
than plant & machinery, except where it is an input service for further supply of works
contract;
Goods or services received by a taxable person for construction of immovable property
on his own account, other than plant & machinery, even when used in course or
furtherance of business;
Goods and/or services on which tax has been paid under composition scheme;
Goods and/or services used for private or personal consumption, to the extent they are so
consumed;
Goods lost, stolen, destroyed, written off, gifted, or free samples;
Any tax paid due to short payment on account of fraud, suppression, mis-declaration,
seizure and detention
ITC, in all the above cases, is to be availed within 1 year from the date of issue of invoice by
the supplier
8.5 Nature of outward supplies provided by VMSB & group and their
applicable GST rates
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AS IS Document
14 Export of Ore 0%
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Rate of TDS
Section Nature of Payment Thresh Hold Limit
Code Individual Others
/ HUF
10 ASSET ACCOUTING
Presently there is no sub ledger Accounting for Asset except for Capital work in
progress.
Assets Posting is directly done to General Ledger in books of accounts
Detailed asset register is maintained separately in FA Module.
1. Land 1101
2. Buildings 1102
6. Vehicles 1108
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AS IS Document
Useful
L
if
e
Class (
Depr.
C I
Asset Class Type Residual R
o Asset Type Description n
Description Code % at
d Y
e
e e
a
r
s
)
01 LAND 11 PURCHASED LAND 0 0 0
12 LEASEHOLD LAND 0 0 0
02 BUILDINGS 11 RESIDENTIAL HOUSE/FLATS - RCC STRUCTURE 5 60 4.87%
12 OFFICE BUILDINGS - RCC STRUCTURE 5 60 4.87%
13 FACTORY BUILDINGS 5 30 9.50%
14 HOTEL BUILDINGS - RCC STRUCTURE 5 60 4.87%
15 FENCES, WELLS, TUBE WELLS 5 5 45.07%
OTHERS (INCLUDING TEMPORARY
16 STRUCTURES) 5 3 63.16%
RESIDENTIAL HOUSE / FLATS - OTHER THAN
21 RCC STRUCTURE 5 30 9.50%
OFFICE BUILDINGS - OTHER THAN RCC
22 STRUCTURE 5 30 9.50%
HOTEL BUILDINGS - OTHER THAN RCC
24 STRUCTURE 5 30 9.50%
PLANT &
03
MACHINERY 11 TIPPERS & DUMPERS 5 8 31.23%
PLANT &
04
MACHINERY 11 EARTHMOVING MACHINERIES 5 8 31.23%
12 GENERATORS 5 15 18.10%
13 AIR COMPRESSORS 5 15 18.10%
14 PUMP SETS 5 15 18.10%
15 WORKSHOP MACHINERIES 5 15 18.10%
16 BEN. PLANT MACHINERIES 5 15 18.10%
17 PRINTING PRESS MACHINERIES 5 15 18.10%
18 EDP EQUIPMENTS 5 3 63.16%
19 OTHER MISC. MACHINERIES 5 15 18.10%
FURNITURE &
05
FITTINGS 11 OFFICE FURNITURES 5 10 25.89%
12 HOTEL FURNITURES 5 8 31.23%
08 VEHICLES 11 TRUCKS, VANS, AMBULANCE ETC. 5 8 31.23%
12 CARS & JEEPS 5 8 31.23%
13 IMPORTED CARS 5 8 31.23%
14 TWO WHEELERS(SCOOTERS, BIKES, MOPEDS) 5 10 25.89%
OTHER
09
EQUIPMENTS 11 OFFICE EQUIPMENTS 5 5 45.07%
14 REFRIGERATORS/COOLERS 5 5 45.07%
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AS IS Document
The Cost of Asset includes the cost of acquisition and other attributable costs for bringing the
asset to its working condition including any interest on the borrowings up to the date of
commissioning.
Depreciation is provided on Written down Value Method to write off the cost of the assets
less their residual values over their useful lives. In respect of additions to the assets,
depreciation is provided from the date of purchase/installation and in respect of assets sold,
depreciation is provided up to the date of sale on pro-rata basis. Assets are scrapped by way
of 100% Depreciation.
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AS IS Document
In case of Intangible Assets Depreciation is provided over the useful life of asset.
Once the bill is received in Account dept. it is verified with purchase order or Work
order, Approvals are checked and the bill is accounted in FAS. In case of Tangible
assets the Bill is forwarded along with the GRN & Issue note. Following entry is
passed in Books.
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AS IS Document
After verifying above details documents is confirm and asset code is generated in
Fixed asset registered.
Thereafter the following details are entered in Fixed Asset module in Asset Sale Entry
screen. On saving the document the asset gets deleted from the register.
Invoice date
Party code
Asset code ( Code of Asset which is to be sold )
Sale quantity
Sale value
On the basis of above details sale register report is generated showing following
details
Asset code
Description of asset
Original cost
Op. Accumulated Depreciation
Depreciation upto sale date
WDV at sale date
Sale price
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Profit / loss
Capital gain
Name of customer (sold to)
Invoice no. & date
All entries for deletion of assets are passed manually. Only depreciation entry is passed by
system automatically once the depreciation is processed.
Employees has to fill the form with respect to his travel along with travel
date, destination purpose and duration of visit and estimated amount of
advance.
After filling the form HOD of concern department authorises the same and
sent for management approval.
Using the requisition number the voucher is codified in system and advance
remittance is prepared which is sent to GM Accounts for approval.
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After approval the document is sent to cash section for processing payment.
Once employee returns from his trip the employee submits his expense
statement ( time frame is not define for submision ) after HOD &
management approval.
01 Advance given
Employee Account Dr XXXX
Bank / Cash Account Cr XXXX
12 Salary Process
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SALARY A/C DR
OVERTIME A/C DR
LEAVE ENCASHMENT DR
CO'S CONTB.TO PROVIDENT FUND DR
CO'S CONTB.TO FAMILY PENSION
FUND DR
CO'S CONTB.TO E S I C DR
TO SALARY PAYABLE CR
TO PROVIDEND FUND PAYABLE CR
TO FAMILY PENSION PAYABLE CR
TO ESIC PAYABLE CR
TO GOA LABOURE WELFARE
PAYABLE CR
TO PROFESSIONAL TAX PAYABLE CR
TO HOUSING LOAN RECOVERY CR
TO COMPANY LOAN PAYABLE CR
TO FESTIVAL ADVANCE CR
TO LIC RECOVERY PAYABLE CR
TO SOCIETY RECOVERY PAYABLE CR
TO TDS PAYABLE CR
TO HOUSING LOAN INTEREST A/C CR
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