B. Significant Accounting Policies:
a. Basis of preparation of financial statements:
• The financial statements have been prepared under the historical cost convention and on an accrual
basis, unless otherwise stated.
• These financial statements have been prepared to comply in all material respects with the applicable
Accounting Standards prescribed under section 133 of the Companies Act, 2013, ('the 2013 Act') read
with the Rule 7 of the Companies (Accounts) Rules, 2014 the provisions of the 2013 Act (to the extent
notified and applicable).
As required by Schedule 111 of the Companies Act, 2013, the company has classified assets and
Liabilities into current and non-current based on the operating cycle. The operating cycle of the
Company has been considered as 12 months.
b. Use of estimates:
The preparation of financial statements in conformity with generally accepted accounting principles
Requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent liabilities at the date of the financial statements and the
results of operations during the reporting period. Although these estimates are based upon
management's best knowledge of current events and actions, actual results could differ from these
estimates. Any revision to the accounting estimates is recognized prospectively in the current and
future periods.
c. Revenue Recognition:
Sales are recognized at the point of dispatch of goods when the substantial risks and rewards of
ownership in the goods are transferred to the buyer as per the terms of the contract and are net of
returns. Sales are stated net of trade discounts and sales taxes. Revenue in respect of Services is
recognized as per work done and approved during the year.
d. Inventories:
The Inventory consists of Stock of Consumables store the valuation of which is made at Cost or Net
Realizable value whichever is lower as specified in Accounting Standard — 2, Valuation of Inventory.
e. Property Plant & Equipment:
Tangible Fixed Assets are stated at cost less accumulated depreciation. The cost of acquisition
comprises of Purchase price inclusive of duties, taxes, incidental expenses etc, up to the date the
assets are ready for intended use.
f. Intangible Assets
Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried
at cost less accumulated amortization and impairment.
g. Capital Work in Progress
Capital work-in-progress comprises the cost of fixed assets that are not yet ready for their intended
use at the reporting date.
h. Depreciation and Amortization:
Depreciation on property, plant and equipment has been provided on SLM method on pro-rata basis
over the useful life prescribed in schedule Il to the Companies Act, 2013 or value assessed by the
management after considering residual value. Depreciation for assets purchased / sold during a period
is proportionately charged. Intangible assets are amortized over their respective individual estimated
useful lives on a straight-line basis, commencing from the date the asset is available to the Company
for its use. The Company has considered the useful life of assets same as prescribed under the
Companies Act, 2013.
i. Borrowing Cost:
Borrowing costs attributable to acquisition and construction of assets are capitalized as part of the
cost of such assets up to the date when such assets are ready for intended use and other borrowing
cost are charged to profit and loss account.
j. Foreign Currence Transaction and balances
Foreign-currency-denominated monetary assets and liabilities are translated at exchange rates in
effect at the Balance Sheet date. The gains or losses resulting from such translations are included in
the Statement of Profit and Loss. Non-monetary assets and non-monetary liabilities denominated in
a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the
date of transaction. Revenue, expense and cash-flow items denominated in foreign currencies are
translated using the exchange rate in effect on the date of the transaction.
k. Retirement and other Employee Benefits
Short-term employee benefits are recognized as expenditure at the undiscounted value in the Profit
and Loss account of the year in which the related service is rendered. Provision for Gratuity is
determined with reference to AS-15 "Employees Benefits". The provision has been made based on the
report/certificate received from Life Insurance Corporation. The Report is prepared as per the
actuarial valuation which is based on certain assumptions about the future experience of the scheme.
l. Taxes on Income:
Current Tax: Current tax is determined as the amount of tax payable in respect of taxable Income for
the year. Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives rise to future
economic benefits in the form of tax credit against future income tax liability, is recognized as an asset
in the Balance Sheet if there is convincing evidence that the Company will pay normal tax and the
resultant asset can be measured reliably.
Deferred Tax: differences that result between the profit considered for income taxes and the profit as
per the financial statements are identified, and thereafter, a deferred tax asset or deferred tax liability
is recorded for timing differences, namely the differences that originate in one accounting period and
reverse in another, based on the tax effect of the aggregate amount of timing difference. The tax
effect is calculated on the accumulated timing differences at the end of an accounting period based
on enacted or substantively enacted regulations. Deferred tax assets are recognized only if here is
virtual certainty supported by convincing evidence that sufficient future taxable income will be
available against which such deferred tax asset can be realized.
m. Impairment of Assets:
Management periodically assesses whether there is an indication that an asset may be impaired.
Impairment occurs where the carrying value exceeds the recoverable value of the assets and its
eventual disposal. impairment loss, if any, is charged to profit and loss account in the year in which as
asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has
been a increase in estimate of recoverable amount, provided that the carrying amount after reversal
would not exceed the Carrying amount would have been if impairment loss is not recognized in prior
period.
n. Earnings per Share (EPS):
The earnings considered in ascertaining the company's EPS comprises the net profit for the period
after tax attributable to equity shareholders. The number of shares used in computing basic EPS is the
average number of shares outstanding during the year. Diluted earnings per share is computed by
dividing the profit after tax by the weighted average number of equity shares considered for deriving
basic earnings per share and also the weighted average number of equity shares that could have been
issued upon conversion of all dilutive potential equity shares.
o. Cash and Cash Equivalents:
Cash and cash equivalents comprise cash at bank and in hand and short-term investments with an
original maturity of three months or less.
p. Cash Flow Statement:
Cash flows are reported using the indirect method, whereby profit / (loss) before tax is adjusted for
the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash
receipts or payments. The cash flows from operating, Investing, and financing activities of the
company are segregated based on the available information.
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