2) SIGNIFICANT ACCOUNTING POLICIES
1.1 Basis of preparation of financial statements: -
The financial statements are prepared under the historical cost convention on accrual basis of accounting and
comply with the Indian Accounting Standards ("Ind AS") including the rules notified under the relevant
provisions of the Companies Act, 2013 amended from time to time.
The financial statements are presented in Indian Rupees and all values are considered in full except otherwise
indicated.
1.2 Use of estimates:
The preparation of financial statements requires the management of the Company to make estimates and
assumptions that affect the reported balances of assets, liabilities, income and expenses and disclosures
relating to the contingent liabilities as at the date of the financial statements and reported amounts of income
and expense during the year. Future results could differ due to changes in these estimates and the difference
between the actual result and the estimates are recognised in the period in which the results are known /
materialise. Estimates and underlying assumptions are reviewed on an ongoing basis.
1.3 Revenue Recognitions:
A) Revenue from sale of goods in the ordinary course of business is recognised when the property in the goods
or all significant risk and reward of their ownership are transferred to the customer and no significant
uncertainity exists regarding the amount of the consideration that will be derived from the sale of the goods
and regarding its collection. Revenue from Services are considered on the basis of completion of work. The
amount recognised as revenue are net of taxes and duties.
B) Interest income is recognised on a time proportion basis taking into account the amount outstanding and the
interest rate applicable.
1.4 Employee Benefit Expenses:-
The Company pays gratuity to the employees who have completed five years of service at the time of
retirement / resignation. The gratuity is paid @15 days basic salary for every completed year of service as per
the Payment of Gratuity Act, 1972. The liability in respect of gratuity and other post employment benefits is
calculated using the Projected Unit Credit (PUC) Method and spread over the period during which the benefit
is expected to be derived from employees services.
The Company has the policy of accounting gratuity and leave encashment liability on cash basis till earlier
years. From the year 2021-22 the Company has started provision of gratuity and leave encashment to meet all
the disclosures and reporting obligations as per Ind AS-19.
Remeasurement of gains and losses arising from adjustments and changes in actuarial assumptions are
recognised in the period in which they occur in Other Comprehensive Income.
1.5 Depreciation:-
A) Depreciation on Fixed assets has been provided on Straight Line Method (SLM) based on the useful life and in
the manner specified in the Schedule II of the Companies Act, 2013. Depreciation on addition/ deletion
during the year is provided for on pro rata basis. The estimated useful life of fixed assets is as follows:
1.6 Fixed Assets:-
All Fixed assets are stated at cost of acquisition less accumulated depreciation. Costs include all expenses
incurred to bring the asset to its present location and condition. On transition to Ind AS, the Company has
elected to continue with value of all of its fixed asset as at 1st April, 2017.
1.7 Inventories:-
Stores and components - At cost
Raw material - At cost
Work in Progress - At Estimated cost.
Scrap - At realizable value.
1.8 Income Tax:-
The Current year has been determined on the basis of Minimum Alternate Tax (MAT) liability under section
115 JB of the Income Tax Act, 1961 & as per normal provisions of Income Tax Act whichever is higher.
Deferred Tax reflect the current period timing differences between taxable income and accounting for the
period and reversal of timing differences of earlier period. Deferred Tax Assets are recognized only to the
extent that there is certainty that sufficient future income will be available to realize the same.
Deferred tax assets and liabilities are measured using the tax rates and tax law that have been enacted or
substantively enacted by the Balance Sheet date.
1.9 Impairment of Assets
In accordance with IND AS 36 on 'Impairment of Assets', where there is an indication of impairment of the
Companys assets related to cash generating units, the carrying amounts of such assets related to cash
generating units, the carrying amounts of such assets are reviewed at each Balance Sheet date to determine
whether there is any impairment. The recoverable amount of such assets is estimated as the higher of its net
selling price and its value in use. An impairment loss is realizable whenever the carrying amount of such
assets exceeds its recoverable amount. Impairment loss is recognized in Profit & Loss account, if at the
Balance Sheet date there is an indication that a previously assessed impairment loss no longer exists, then
such loss is reversed and the asset is restated to the extent of the carrying value of the asset that would have
been determined (net of amortization/depreciation) had no impairment loss been recognized.
1.9 Earnings per share
In determining the earning per share, the company considers the net profit after tax and post tax effect of any
extra ordinary/exceptional item is shown separately. The number of shares considered in computing basic
earning per share is the weighted average number of shares outstanding during the year.
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