SIGNIFICANT ACCOUNTING POLICIES:
a. Property, Plant and Equipment:
Property, Plant and Equipment is stated at cost, net of accumulated depreciation and accumulated impairment
losses, if any. Cost comprises of purchase price inclusive of taxes, commissioning expenses, etc., up to the date the
asset is ready for its intended use. Fixed assets which were revalued are carried at revalued values. Expenditure
directly related to expansion projects has been capitalized.
Cost includes non refundable taxes, duties, freight, borrowing costs and other incidental expenses related to the
acquisition and installation of the respective assets.
Assets under installation or under construction as at the Balance Sheet date are shown in Capital work-in —progress.
Advances paid towards acquisition of assets are shown in Capital Advances.
Fixed assets which are found to be not usable or retired from active use of when no further benefits are expected
from their use are removed from the books of account and the difference if any, between the cost of such assets and
the accumulated depreciation there on is charged to Statement of Profit & Loss.
Depreciation on tangible assets is provided under Straight Line Method over the useful lives of assets estimated by
the management. Depreciation on additions / deletions during a period is charged on pro rata basis from the date
of addition or deletion, as the case may be.
b. Impairment of Assets:
In accordance with Ind AS 36, the company assesses at each Balance Sheet date whether there is any indication that
an asset may be impaired. An asset is treated as impaired when the carrying cost exceeds its recoverable value. An
impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired.
The impairment loss recognized in a prior accounting period is reversed if there has been a change in the estimate
of recoverable amount.
c. Employee Benefits:
Retirement benefits to employees comprise of payments under Defined Contribution Plans like Provident Fund
and payments under Defined Benefit Schemes like Gratuity and Leave encashment.
Payments under defined contribution plans are charged to revenue on accrual. The liability in respect of defined
benefit scheme is arrived based on actuarial valuation made at the end of the year by using projected unit credit
method.
Short-term employee benefits such as wages, salaries and short-term compensated absences like bonus and other
non-monetary benefits are provided for as per Company’s Rules on best estimate basis.
Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts
included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts include
in net interest on the net defined benefit liability), are recognized immediately in the Balance Sheet with a corresponding
debit or credit to retained earnings through OCI in the period in which they occur. Re-measurements are not
reclassified to profit or loss in subsequent periods.
d. Valuation of Inventories:
Inventories are valued at the lower of cost and net realizable value. Cost is arrived at by using weighted average
method and includes all costs of purchases, conversion and other costs incurred in bringing the inventories to their
present location and condition.
e. Investments:
Investments intended to be held for more than one year are treated as long term and others as short term. Short¬
term investments are carried at the lower of cost or quoted / fair value, computed category wise and long term
investments are stated at cost. Provision for diminution in the value of long —term investments is made only if
such a decline is other than temporary. As there are no investments made by the Company in any subsidiary or
equity instruments, provisions of IND-AS 27 are not applied.
f. Prior period expenses / Income:
The Company follows the practice of making adjustments through “expenses/income under/over provided”
in previous years in respect of material transactions pertaining to that period prior to the current accounting year.
g. Government Grants:
Government grants available to the company are recognized when there is a reasonable assurance that the conditions
attached to the grant will be complied with and reasonably certain that grants will be received.
h. Tax Expenses
Tax expense for the period comprises current tax and deferred tax. Tax is recognised in Statement of Profit and Loss
except to the extent that it relates to items recognised in the comprehensive income or in equity. In which case, the
tax is also recognised in other comprehensive income or equity.
> Current tax
Current tax assets and liabilities are measured at the amounts expected to be recovered from or paid to the
taxation authorities, based on the tax rates and laws that are enacted or substantively enacted at the Balance
sheet date.
> Deferred tax
Deferred tax is recognised on temporary differences between the carrying amount of assets and liabilities in
the financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities and as sets are measured at the tax rates that are expected to apply in the period in which
the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period. The carrying amount of deferred tax liabilities and
assets are reviewed at the end of each reporting period.
i. Foreign Exchange Transactions:
Transactions denominated in foreign currency are accounted for initially at the exchange rate prevailing on the date
of transaction. Foreign Currency monetary Assets and Liabilities are translated at year end exchange rates. Fluctuations,
if any due to change in exchange rates Between the dates of transactions and the dates of crystallization are debited
/ credited to Statement of Profit & Loss.
j. Revenue Recognition:
Revenues from Projects under long term contracts is recognized by reference to the completion of the contract
activity at the reporting date, where the contract activity extend beyond the reporting date, on the basis of percentage
of completion method.
Revenues from services are recognized as per the terms of contract with customers when the related services are
performed or the agreed milestones are achieved.
Interest income on general deposits with Bank and others is recognized on time proportion basis.
k. Borrowing Costs:
Borrowing costs attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost
of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended
use. All other borrowing costs are charged to revenue.
|