| H.    Provisions, contingent liabilities and contingent assetsProvisions are recognised only when: a)    the company has a present obligation (legal or constructive) as a result of a past event; b)    it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and c)    a reliable estimate can be mad e of the amount of the obligation. Provision is measured using the cash flows estimated to settle the present obligation and whenthe effect of time value of money is material, the carrying amount of the provision is the present
 value of those cash flows. Reimbursement expected in respect of expenditure required to settle a
 provision is recognised only when it is virtually certain that the reimbursement will be received.
 Contingent liability is disclosed in case of: d)    a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation; and e)    a present obligation arising from past events, when no reliable estimate is possible. Contingent assets are disclosed where an inflow of economic benefits is probable. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.Department appeals, in respect of cases won by the Company, are also considered as Contingent
 Liabilities.
 I.    Cash and Cash EquivalentsCash and cash equivalents include cash and cheques in hand, bank balances, demand depositswith banks and other short term highly liquid investments that are readily convertible to know
 amounts of cash and which are subject to an insignificant risk of changes in value where original
 maturity is three months or less.
 J.    Employee benefitsShort-term employee benefits are measured on an undiscounted basis and expensed as therelated service is provided. A liability is recognised for the amount expected to be paid under
 short-term cash bonus, if the Group has a present legal or constructive obligation to pay this
 amount as a result of past service provided by the employee and the obligation can be estimated
 reliably.
 K.    Statement of Cash FlowsStatement of Cash Flows is prepared segregating the cash flows into operating, investing andfinancing activities. Cash flow from operating activities is reported using indirect method,
 adjusting the net profit for the effects of:
 Ý    changes during the period in inventories and operating receivables and payables transactionsof a non-cash nature;
 Ý    non-cash items such as depreciation, provisions, deferred taxes, unrealised foreign currencygains and losses, and undistributed profits of associates; and
 Ý    all other items for which the cash effects are investing or financing cash flows. Cash and cash equivalents (including bank balances) shown in the Statement of Cash Flowsexclude items which are not available for general use as on the date of Balance Sheet.
  
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