| (a) General:
Accounting Principles not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles. The company prepares its accounts on accrual basis, except
otherwise stated, in accordance with normally accepted policies. The
accounts are prepared on historical cost basis and as a going concern.
(b) Revenue Recognition
The Company's income from operation is accounted for on accrual basis.
(c) Fixed Assets:
All the Fixed Assets have been stated on cost inclusive of incidental
expenses less accumulated depreciation.
(d) Depreciation:
Depreciation is calculated on Fixed Assets on straight- line method in
accordance with the schedule XIV as amended of the Companies Act, 1956
(e) Investments:
Long term investments are valued at cost, less provision for
diminution, other than temporary. Short term investments are valued at
cost or market value, which is lower.
(f) Inventory:
(a) Finished goods are valued at cost or net realizable value,
whichever is lower.
(b) Raw materials and stores & spares are valued at cost.
(c) Work in progress is valued at the cost incurred.
(d) The cost of inventories comprises all costs of purchase (including
duties for which no credit/ rebate is to be received), costs of
conversion and other costs incurred in bringing the inventories to
their present location and condition. Trade discounts, rebates, duty
drawbacks and other similar items are deducted in determining the costs
of purchase.
(e) The cost of inventories is arrived by using First- In-First-Out
(FIFO) cost formula.
(g) Miscellaneous expenditure:
Preliminary expenses & Public Issue Expenses are being written off over
a period of 10 years.
(h) Retirement Benefits:
Provision for Gratuity will be accounted for on the retirement /
cessation of employment. No amount has been charged to Profit & Loss
Account on account of gratuity during the previous year.
(I) Contingent Liabilities
Unprovided contingent liabilities are disclosed in the accounts by way
of notes giving nature and quantum of such liabilities.
(i) Taxation
Provision for Taxation has been made in accordance with the Income Tax
Act, 1961.
Deferred tax resulting from timing difference between book and tax
profits is accounted for under the liability method, at the current
rate of tax, to the extent that the timing differences are expected to
crystallise.
The Policies not specifically mentioned above are in agreement with the
accounting standards issued by the Institute of Chartered Accountants
of India.
(iii) Terms/rights attached to equity shares
The company has only one class of equity shares having a par value of Rs.
10 per share. In the event of liquidation of the company, the holders
of equity shares will be entitled to receive remaining assets of the
company, after distribution of all preferential amonuts. The
distribution will be in proportion to the number of equity shares held
by the shareholders.
|