Significant Accounting Policies
CONVENTION
To prepare financial statements in accordance with applicable Accounting Standards in India. A summary of accounting
policies, which have been applied consistently, is set out below. The financial statements have also been prepared in
accordance with relevant presentational requirement of the Companies Act, 2013.
BASIS OF ACCOUNTING
The financial statements have been prepared under the historical cost convention and on accrual basis and on going
concern concept.
USE OF ESTIMATES
The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of
assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the
reported period. Difference between the actual results and estimates are recognized in the period in which the results are
known/materialized.
FIXED ASSETS
To state Fixed Assets at the cost of acquisition inclusive of inward freight, duties and taxes and incidental expenses related
to acquisition. In respect of major projects involving construction/fabrication, related pre-operational expenses form part of
the value of the assets capitalized. Expenses capitalized also includes applicable borrowing costs. To adjust the original cost
of fixed assets acquired through foreign currency loans at the end of each financial year by any change in liability arising out
of expressing outstanding foreign currency loan at the rate of exchange prevailing at the date of Balance Sheet.
To capitalize software where it is expected to provide future enduring economic benefits. Capitalization costs includes
license fees and cost of implementation/system integration services. The costs are capitalized in the year in which the
relevant software is implemented for use.
All up-gradations/enhancements are generally charged off as revenue expenditure unless they bring similar significant
additional benefits.
No amortization is provided in the Accounts in respect of Leasehold Land in view of the long term tenure, which is akin to
ownership.
Depreciation on Fixed Assets is provided for on Straight Line Method over the useful life of the assets at the rates and in the
manner specified in the Schedule II of the Companies Act, 2013.
INVESTMENTS
To state current investment at lower of cost and fair value, and long term investments are stated at cost. Where applicable,
provision is made where there is a permanent fall in valuation of long term investments.
Cost is arrived at on First In First Out basis. Cost comprises expenditure incurred in normal course of the business in bringing
such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activities.
Obsolete, slow moving and defective inventories are identified at the time of physical verification of inventories and, where
necessary, provision is made for such inventories.
IMPAIRMENT OF ASSETS
Impairment is ascertained at each balance sheet date in respect of company's fixed assets. An impairment loss is recognized
wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net
selling price and value in use. In assessing value and use, the estimated future cash flows are discounted to their present
value based on an appropriate discount factor.
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