| The financial statements have been prepared under the historical cost
convention in accordance with the generally accepted accounting
principles and provisions of the Companies Act, 1956 as adopted
consistently by the Company.
a) METHOD OF ACCOUNTING
The Company follows the accrual system of accounting and recognises
income and Expenditure on accrual basis except Insuarance Claim or
Refund, Octroi Duty Refund, Sales Tax Refund etc on receipt basis and
Insurance Premium, Rates & Taxes, Sales Tax Due on Assessment, Arrears
of salary/wages & bonus etc on payment basis.
b) FIXED ASSETS
1. Tangible assets are stated at cost, adjusted by revaluation at
current replacement values wherever applicable.
2. The company has provided depreciation on all fixed assets as per the
new rates (SLM Method) specified iri Schedule XIV to the Companies Act,
1956 vide notification No 756(E) dated 16.12 1993 issued by the
Department of Company affairs
3. The Company has provided depreciation on revalued amounts of fixed
assets as per the old rates {SLM Method) specified in schedule XJV to
the Companies Act, 1956 and same is recouped from Revalution Reserve.
4 The Company has provided depreciation on additions to assets during
the year on prorata basis as required under the Companies Act, 1956
c) INVENTORIES
Raw Materials are valued at cost, Work-in-process is valued at
estimated cost, Finished Goods are valued at estimated cost or market
value which ever is lower and Packing Materials, Fuel & Stores & Spares
are valued at cost,
d) EXCISE DUTY
Excise duly is accounted as and when the same is paid on the dispatch
of the goods from factory.
No provision is made for excise duty in respect of finished products
lying in the factory, as the same has no impact on the profit of the
year,
e) RETIREMENT BENEFITS
Retirement benefits such as Gratuity, Leave encashment are accounted on
cash basis.
f) PURCHASE AND SALE
Purchase of raw materials include processing charges paid and is net of
resale of raw material.
Sales include job charges received.
g) TAXATION
Income Tax comprises of Current Tax and Deffered Tax, The provision for
Current Income Tax is made on ! the assessable income at the rate
applicable to relevant Assessement Year. Deferred Tax Asset and
Deferred Tax liability are calculated by applying tax rate and taxlaws
that have been enacted by the Balance Sheet
Date.
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