| a) BASIS OF ACCOUNTING:
The accompanying financial statements have been prepared on the
assumption that the company is a going concern and in accordance with
the historical cost convention, generally accepted accounting
principles and the Accounting Standards under the Companies Accounting
Standards Rules, 2006
b) FIXED ASSETS AND CAPITAL WORK IN PROGRESS:
Fixed Assets are stated at historical cost less accumulated
depreciation. Cost of the fixed asset is inclusive of freight,
installation, duties and other incidental expenses but excludes taxes
and duties that are recoverable subsequently from the taxing
authorities.
Capital work in progress comprise of cost of fixed assets that are not
ready for their intended use as at the balance sheet date.
c) DEPRECIATION:
Buildings, Plant and Machinery and electrical installations are
depreciated on Straight Line Method and other assets on Written Down
Value basis at the rates prescribed in Schedule XIV to the Companies
Act, 1956.
d) INVESTMENTS:
Long term investments are stated at cost. Provision for diminution in
the value of long term investments is made if such decline is other
than temporary in the opinion of the management.
e) INVENTORIES:
Inventories are valued at lower of cost and net realizable value. Cost
is determined based on monthly weighted average. Cost includes taxes,
duties and other incidental expenses but excludes taxes and duties that
are recoverable subsequently from the taxing authorities.
f) FOREIGN CURRENCY TRANSACTIONS:
The foreign currency transactions are accounted for at the exchange
rates prevailing on the date of transactions. The fluctuation variation
in respect of foreign currency transactions remaining unsettled as at
the end of the year are translated at the rates prevailing on the last
day of the year. Foreign exchange differences are recognized in the
profit and loss statement to the period in which they arise.
g) INCOME AND EXPENDITURE RECOGNITION:
Income is recognized and expenditure is accounted for on their accrual.
Revenue from sale is recognized on transfer of significant risk and
reward. Sales are inclusive of excise duty and net of sales returns and
trade discounts.
h) INTANGIBLE ASSET:
Intangible assets are recognized only if there is any Future Economic
Benefit. Research expenses are charged to revenue.
i) EMPLOYEE COST:
Short term employee benefits, in respect of leave salary, leave travel
allowance and reimbursement of medical expenses, the liability has been
fully provided on undiscounted basis, in accordance with the schemes in
force.
The contribution to provident fund ( Defined Contribution Plan ) as per
the provisions of the Employees' Provident Fund and Miscellaneous
Provisions Act, 1952 is recognized and charged to revenue.
The company's liability towards retirement benefits, in the form of
gratuity, and other retirement benefits(Defined Benefit Plans) is
worked out on actuarial basis at the end of the year and is provided.
j) BORROWING COST:
Borrowing costs that are attributable to the qualifying assets are
capitalized till the date of commissioning, as part of the cost of such
assets. All other borrowing costs are charged to revenue.
k) TAXES ON INCOME
i) Taxes on income are accrued in the same period as the revenue and
expenses to which they relate and are reckoned as Current tax and
Deferred tax.
ii) Current Taxes are measured at the amount expected to be paid to the
taxation authorities, using the applicable tax rates and tax laws.
iii) Deferred tax on account of Tax effect on the accumulated timing
differences that arises between the Accounting income and Taxable
income is measured using the tax rates and tax laws that have been
enacted or substantively enacted by the Balance Sheet date.
iv) Deferred Tax Asset is recognized on reasonable certainty that
sufficient future taxable income will be available.
l) IMPAIRMENT OF ASSETS:
As at each Balance Sheet date, the carrying amount of assets is tested
for impairment so as to determine the extent of recognition of
provision for impairment loss, if any, required or the reversal, if
any, required of impairment loss recognised in previous periods.Where
the carrying amount of an asset exceeds its recoverable amount, such
excess is recognised as impairment loss and charged to revenue.
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