3.1 Method of accounting:
The financial statements have been prepared on a historical cost basis, except where fair value of certain assets and liabilities can be acertained,
defined benefits plan assets measured at fair value and share based payments.
3.2 Use of Estimate
The preparation of financial statements in conformity with the generally accepted accounting principles requires estimates and assumptions to be
made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and
expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are
known/ materialized.
3.3 Property, Plant & Equipment
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,only when it is probable that future
economic benefits associated with the item will flow to the group and the cost of the item can be measured reliably. The carrying amount of any
component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during
the reporting period in which they are incurred.
On transition to Ind AS, the company has elected to continue with the carrying value of all of its property, plant and equipment recognised as on
date measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.
Depreciation is calculated using the written down method to allocate their cost, net of their residual values, over their estimated useful life of the
asset as prescribed in Schedule II of the Companies Act, 2013
3.4 Intangible Assets
Intangible assets are recognised when it is probable that the future econnomic benefit that are attributable to the assets still flow to the company
and the cost of the assets can be measured reliably. The amortisation period and the amortisation for an intangible assets with a finite useful life
are reviewed at least at the end of each reporting period.
On transition to Ind AS, the company has elected to continue with the carrying value of all of intangible assets recognised as on date measured as
per the previous GAAP and use that carrying value as the deemed cost of intangible assets.
3.5 Capital Work-In-Progress
Capital work-in-progress are carried at cost, comprising direct cost, related incidental expenses and attributable borrowing cost.
3.6 Investments
The Company in respect of equity investments (other than in subsidiaries, associates and joint ventures) which are not held for trading has made
an irrevocable election to present in other comprehensive income subsequent changes in the fair value of such equity instruments. Such an election
is made by the Company on an instrument by instrument basis at the time of initial recognition of such equity investments. These investments are
held for medium or long-term strategic purpose. The Company has chosen to designate these investments in equity instruments as fair value
through other comprehensive income as the management believes this provides a more meaningful presentation for medium or long-term strategic
investments, than reflecting changes in fair value immediately in the statement of profit and loss
3.7 Inventories
The cost of inventories have been computed to include all cost of purchase , cost of conversion and other related costs incurred in bringing the
inventories to their present location and condition. Slow and Non-moving material , obsolescence, defective inventories are duly provided for and
value at net realizable value . Goods and materials in transit are valued at actual cost incurred upto the date of balance sheet, material and supplies
held for use in the production of inventories are not written down if the finished products in which they will be used are expected to be sold at or
above cost.
3.8 Employee Benefits
All employee benefit payable wholly within twelve months rendering services are classified as short term employee benefits. Benefits such as
salaries, wages, short term compensated absences performance incentives etc, and the expected cost of bonus ex-gratia are recognized during the
period in which the employee renders related service.
Payment to defined contribution retirement benefit plans are recognised as an expense when employee have rendered the service entitiling them to
the contribution.
Long Term Defined Contributions are accounted for on the basis of contributions made during the year. The company has open a LIC Fund in
which every year the company makes a contribution.
3.9 Borrowing Cost
Borrowing costs specifically relating to the acquisition or construction of qualifying assets that necessarily takes a substantial period of time to get
ready for its intended use are capitalized (net of income on temporarily deployment of funds) as part of the cost of such assets. Borrowing costs
consist of interest and other costs that the Company incurs in connection with the borrowing of funds. For general borrowing used for the purpose
of obtaining a qualifying asset, the amount of borrowing costs eligible for capitalization is determined by applying acapitalisation rate to the
expenditures on that asset. The capitalization rate is the weighted average of the borrowing costs applicable to the borrowings of the Company that
are outstanding during the period, other than borrowings made specifically for the purpose of obtaining aqualifying asset. The amount of
borrowing costs capitalized during a period does not exceed the amount of borrowing cost incurred during that period. All other borrowing costs
are expensed in the period in which they occur.
3.10 Income Tax
Tax expense for the period, comprising current tax and deferred tax, are included in the determination of the net profit or loss for the period.
Current tax is measured at the amount expected to be paid to the tax authorities in accordance with the taxation laws prevailing in the respective
jurisdictions.
Deferred tax is recognised for all the timing differences, subject to the consideration of prudence in respect of deferred tax assets. Deferred tax
assets are recognised and carried forward only to the extent that there is a reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realised. Deferred tax assets and liabilities are measured using the tax rates and tax laws
that have been enacted or substantively enacted by the Balance Sheet date. At each Balance Sheet date, the company reassesses unrecognised
deferred tax assets, if any.
|