Accounting Policies of ATV Projects India Ltd. Company

Mar 31, 2018

A. General Information: ATV Projects (India) Limited is a public company incorporated under the provisions of the Companies Act, 2013 and listed with Bombay Stock Exchange. The Company is engaged in the business of rendering Project Management and Engineering Services, Project supplies and for executing jobs for various industries.

B. Basis of preparation of financial statement :

I. Compliance with Ind AS

Financial statements have been prepared in accordance with the Indian Accounting Standards (hereafter referred to as the “Ind AS”) as notified by the Ministry of Corporate Affairs pursuant to Section 133 of Companies Act, 2013 (the “Act”) read with the Companies (Indian Accounting Standards (Ind AS) Rules, 2015 as amended and other relevant provisions of the Act and rules framed thereunder. The Company''s financial statement upto and for the year ended 31st March 2017 were prepared in accordance with the accounting standards specified under Section 133 of the Companies Act 2013, read together with the Rule 7 of the Companies (Accounts) Rules, 2014 (Previous GAAP). The Company''s financial statements are reported in Indian Rupee, which is also Company''s functional currency. The financial statements for the year ended 31st March, 2018 are the first financial with comparatives, prepared under Ind AS. The adoption was carried out in accordance with Ind AS 101, First Time adoption of Indian Accounting Standards. The transition was carried out from Indian Accounting Principle generally accepted in India as prescribed under Section 133 of the Act read with the Rule 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP), which was the previous GAAP. Reconciliation and description of the effect of the transition have been summarized in Note 2 to the financial statement. The accounting policies are applied consistently to all the periods presented in the Financial Statements, including the preparation of the opening Ind AS balance sheet as at 1st April 2016 being the date of transition.

II. Historical cost convention: The financial statements have been prepared on a historical cost basis.

III. Rounding of amounts: All the amounts disclosed in the financial statements and notes are presented in Indian Rupees and have been rounded off to the nearest lakhs as per the requirement of Schedule III unless otherwise stated.

IV. Current and Non-current classification: All assets and liabilities have been classifies as current or no-current as per the Company''s normal operating cycle (twelve months) and other criteria set out in the schedule III to the act.

C. Property, Plant and Equipment :

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any. Cost includes purchase price and expenditures directly attributable to bringing them into working condition for its intended use. Freehold land are carried at cost, less accumulated -impairment losses, if any are not depreciated.

Depreciation on property, plant and equipments is provided under the written down value method over the useful lives of assets as prescribed in Schedule II to the Companies Act 2013 (“Act”), and management believes that useful life of assets are same as those prescribed in Schedule II to the Act. The residual values are not more than 5% of the Original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. Gain or losses arising from derecognisation of property, plant and equipment are measured as difference between the net disposal proceeds and the carrying amount of the assets and are recognized in the statement of profit and loss when the asset is derecognised.

D. Inventories: Inventories are valued at lower of cost computed on weighted average basis or net realisable value after providing cost of obsolescence, if any. The cost of inventories comprises cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Net realisable value is estimated selling price in ordinary course of business less the estimated cost necessary to make the sale.

E. Revenue Recognition : Revenue from sale of products is recognised when the property in the goods, or all significant risks and rewards of ownership of the products have been transferred to the buyer, and no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of products as well as regarding its collection. Revenues include excise duty and are shown net of sales tax, value added tax, and applicable discounts and allowances if any. Revenue includes only those sales for which the Company has acted as a principal in the transaction, takes title to the products, and has the risks and rewards of ownership, including the risk of loss for collection, delivery and returns. The Company uses the percentage of completion method using the input (cost expended) method to measure progress towards completion in respect of fixed price contracts. Percentage of completion method accounting relies on estimates of total expected contract revenue and costs.

F. Employee Benefits: Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity as at the balance sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

G. Income tax:

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received after considering uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

H. Earnings per share:

Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Company

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year and excluding treasury shares

(ii) Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

- the after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and

- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares

I. Use of estimates and Judgements:

The estimates and judgements used in the preparation of financial statements are continuously evaluated by the management and are based on historical experience and various other assumptions and factors that the management believes to be reasonable under existing circumstances. Difference between actual results and estimates are recognized in the period in which the results are known/materialized. The said estimates are based on the facts and the events, that existed as at the reporting date, or that date but provide additional evidence about conditions existing on the reporting date.

I. Impairment of non financial asset:

Assessment is done at each Balance Sheet date to evaluate whether there is any indication that a nonfinancial asset may be impaired. An asset''s recoverable amount is the higher of an asset''s fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no such transactions can be identified, an appropriate valuation model is used.

II. Depreciation/amortization and useful lives of property, plant and equipment/intangible assets:

Property, plant and equipment are depreciated over the estimated useful lives of the assets, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and residual values are based on the Company''s -historical experience with similar assets and take into account anticipated technological changes. The depreciation for future periods is adjusted if there are significant changes from previous estimates.

III. Recoverability of trade receivables:

Judgments are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. Factors considered include the credit rating of the counter party, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment.

IV. Provisions and contingent liabilities:

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group or where any present obligation cannot be measured in terms of future outflow of resources or where a reliable estimate of the obligation cannot be made.

J. Functional and Presentation currency:

These financial statements are prepared in Indian rupees; the national currency of India, which is functional currency of the company.

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Mar 31, 2016

CORPORATE INFORMATION

ATV Projects (India) Limited is a public company incorporated under the provisions of the Companies Act, 1956 and listed with Bombay Stock Exchange. The Company is engaged in the business of rendering Project Management and Engineering Services, Project Supplies and for executing jobs for various industries.

SIGNIFICANT ACCOUNTING POLICIES.

1. Basis of Preparation of Financial Statements

a. The financial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 2013.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. 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 reporting period . Difference between actual results and estimates are recognized in the period in which results are known/ materialized.

3. Fixed Assets

Fixed Assets are capitalized at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30^th September, 1987. All costs, including financing cost till commencement of Commercial Productions are capitalized.

4. Depreciation

In respect of depreciable assets, depreciation is provided on Written down Value basis as per the manner and revised useful life prescribed under Schedule II of the Companies Act, 2013 read with Note No. B. 8 hereinafter.

5. Impairment of Assets

An asset is treated as impaired when carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

6. Inventories

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

7. Modvat Credit

a. Modvat credit is accounted by recording the material/capital asset acquired during the year net of excise duty.

b. Modvat credit receivables shown under the head of “Loans & Advances” includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on dispatch of finished goods, on the determination of the amount by relevant authorities.

8. Revenue Recognition

(a) Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

(b) Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

9. Employees Benefits

Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity and leave encashment as at the balance sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

10. Expenses

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. 3.1(g) of Notes an financial statements.

11. Excise Duty

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

12. Provisions, Contingent Liabilities

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates.

Contingent liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

13. Taxes on Income

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognized using current tax rates and subject to the consideration of prudence, or timing differences, being the difference between taxable income and accounting income that originate in one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other temporary timing difference are recognized only if there is a reasonable certainty of realization.

1.2

Calls in arrears include unpaid allotment money related to Debentures which have been converted on its due date in to Equity Shares as per the terms of the issue but in respect of which the Company, in exercise of its lien on such shares, has not issued the Shares Certificates to the defaulting Debenture Holders. The Company''s lien on such shares will extend to the forfeiture of such shares, if considered necessary by the Company.

1.3

The Issued and Subscribed Share Capital of the Company includes 62,00,000 Equity Share of Rs. 10 Each allotted as fully paid - up without payment being received in cash pursuant to a Scheme of Amalgamation in the year 1987.

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Mar 31, 2015

1. Basis of Preparation of Financial Statements

a. The financial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 2013.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. 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 reporting period. Difference between actual results and estimates are recognized in the period in which results are known/ materialized.

3. Fixed Assets

Fixed Assets are capitalized at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30th September, 1987. All costs, including financing cost till commencement of commercial productions are capitalized.

4. Depreciation

In respect of depreciable assets, depreciation is provided on Written Down Value basis as per the manner and revised useful life prescribed under Schedule II of the Companies Act, 2013 read with Note No. B. 8 hereinafter.

5. Impairment of Assets

An asset is treated as impaired when carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

6. Inventories

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

7. Modvat Credit

a. Modvat credit is accounted by recording the material/capital asset acquired during the year, net of excise duty.

b. Modvat credit receivables shown under the head of "Loans & Advances" includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on despatch of finished goods, on the determination of the amount by relevant authorities.

8. Revenue Recognition

(a) Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

(a) Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

9. Employees Benefits

Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity and leave encashment as at the Balance Sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

10. Expenses

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. 3.1(g) of Notes on financial statements.

11. Contingent Liabilities

Contingent liabilities not provided for are disclosed in the accounts by way of notes specifying the nature and quantum of such liabilities.

12. Excise Duty

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

13. Provisions, Contingent Liabilities

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made.

Contingent Liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

14. Taxes on Income

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognised using current tax rates and subject to the consideration of prudence, or timing differences, being the difference between taxable income and accounting income that originate in one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other temporary timing difference are recognized only if there is a reasonable certainty of realization.

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Mar 31, 2014

1. Basis of Preparation of Financial Statements

a. The finanancial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. 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 reporting period. Difference between actual results and estimates are recognized in the period in which results are known/materialized.

3. Fixed Assets:

Fixed Assets are capitalized at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30th September, 1987. All costs, including financing cost till commencement of Commercial Productions are capitalized.

4. Depreciation :

In respect of depreciable assets, depreciation is provided on Written down Value basis as per the Rates prescribed under Schedule XIV of the Companies Act, 1956 read with Note No. B.8 hereinafter.

5. Impairment of Assets

An asset is treated as impaired when carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

6. Inventories :

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

7. Modvat Credit :

a. Modvat credit is accounted by recording the material / capital asset acquired during the year net of excise duty.

b. Modvat credit receivables shown under the head of "Loans & Advances" includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on despatch of finished goods, on the determination of the amount by relevant authorities.

8. Revenue Recognition

a. Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

b. Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

9. Employees Benefits

Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity and leave encashment as at the balance sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

10. Expenses

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. 3.1(g) of Notes of financial statements.

11. Contingent Liabilities

Contingent liabilities not provided for are disclosed in the accounts by way of notes specifying the nature and quantum of such liabilities.

12. Excise Duty

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

13. Provisions, Contingent Liabilities

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made.

Contingent liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

14. Taxes on Income

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognised using current tax rates and subject to the consideration of prudence, or timing differences, being the difference between taxable income and accounting income that originate in one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other temporary timing difference are recognized only if there is a reasonable certainty of realization

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Mar 31, 2013

1. Basis of Preparation of Financial Statements

a. The finanancial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. 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 reporting period. Difference between actual results and estimates are recognized in the period in which results are known/materialized.

3. Fixed Assets:

Fixed Assets are capitalized at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30''" September, 1987. All costs, including financing cost till commencement of Commercial Productions are capitalized.

4. Depreciation :

In respect of depreciable assets, depreciation is provided on Written down Value basis as per the Rates prescribed under Schedule XIV of the Companies Act, 1956 read with Note No. BJ3 hereinafter.

5. Impairment of Assets

An asset is treated as impaired when carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

6. Inventories :

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

7. Modvat Credit:

a. Modvat credit is accounted by recording the material / capital asset acquired during the year net of excise duty.

b. Modvat credit receivables shown under the head of "Loans & Advances" includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on despatch of finished goods, on the determination of the amount by relevant authorities.

8. Revenue Recognition

a. Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

b. Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

9. Employees Benefits

Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity and leave encashment as at the balance sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

10.Expenses

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. 3.1(g) of Notes of financial statements.

11. Contingent Liabilities

Contingent liabilities not provided for are disclosed in the accounts by way of notes specifying the nature and quantum of such liabilities.

12. Excise Duty

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

13. Provisions, Contingent Liabilities

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made.

Contingent liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

14. Taxes on income

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognised using current tax rates and subject to the consideration of prudence, or timing differences, being the difference between taxable income and accounting income that originate in one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other temporary timing difference are recognized only if there is a reasonable certainty of realization.

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Mar 31, 2012

1. Basis of Preparation of Financial Statements

a. The finanancial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. 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 reporting period. Difference between actual results and estimates are recognized in the period in which results are known/materialized.

3. Fixed Assets:

Fixed Assets are capitalized at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30th September, 1987. All costs, including financing cost till commencement of Commercial Productions are capitalized.

4. Depreciation :

In respect of depreciable assets, depreciation is provided on Written down Value basis as per the Rates prescribed under Schedule XIV of the Companies Act, 1956 read with Note No. B - 8 hereinafter.

5. Impairment of Assets

An asset is treated as impaired when carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which asset if identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

6. Inventories :

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

7. Modvat Credit :

a. Modvat credit is accounted by recording the material / capital asset acquired during the year net of excise duty.

b. Modvat credit receivables shown under the head of "Loans & Advances" includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on despatch of finished goods, on the determination of the amount by relevant authorities.

8. Revenue Recognition

(a) Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

(b) Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

9. Employees Benefits

Eligible Employees receive benefit from Provident Fund which is a defined benefit plan both the employees and the company make monthly contribution to the Provident Fund equally to specified percentage of the covered employee salary and contribution to Government Administered Fund.

As per the past practice, the present value of the obligation of the staff benefits like gratuity and leave encashment as at the balance sheet date under such defined benefit plan is determined based on actuarial valuation as certified by the management.

10. Expenses

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. 3.1(g) of Notes an financial statements.

11. Contingent Liabilities

Contingent liabilities not provided for are disclosed in the accounts by way of notes specifying the nature and quantum of such liabilities.

12. Excise Duty

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

13. Provisions, Contingent Liabilities

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made.

Contingent liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

14. Taxes on Income

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognised using current tax rates and subject to the consideration of prudence, or timing differences, being the difference between taxable income and accounting income that originate in one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other temporary timing difference are recognized only if there is a reasonable certainty of realization.

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Mar 31, 2010

1. Basis of Preparation of Financial Statements

a. The finanancial statements have been prepared under the historical cost convention and unless otherwise stated, are in accordance with the generally accepted accounting principles, the Accounting Standard issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956.

b. Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the Company.

2. Fixed Assets:

Fixed Assets are capitalised at cost inclusive of expenses incidental thereto barring certain fixed assets which were valued on 30" September, 1987. All costs, including financing cost till commencement of Commercial Productions are capitalised.

3. Depreciation :

In respect of depreciable assets, depreciation is provided on Written down Value basis as per the Rates prescribed under Schedule XIV of the Companies Act, 1956 read with Note No. B - 8 hereinafter.

4. Inventories :

Inventories are valued at the lower of cost or its net realizable value. The cost is arrived at on FIFO basis.

5. Modvat Credit :

i. Modvat credit is accounted by recording the material / capital asset acquired during the year net of excise duty.

ii. Modvat credit receivables shown under the head of "Loans & Advances" includes on FIM received from the parties which are adjusted, to the cost of Fixed Assets / Excise duty payable on despatch of finished goods, on the determination of the amount by relevant authorities.

6. Income:

(a) Income on account of contracts / orders to be executed in more than one financial year is accounted to the extent of work done and billed by the Company.

(b) Other heads of income having a material bearing on the financial statements are recognized on accrual basis except sale of scrap on cash basis.

7. Expenses:

All expenditure items having a material bearing on the financial statements are recognized on accrual basis unless otherwise stated read with Note No. B - 10 hereinafter.

8. Excise Duty :

The Company has the practice of treating the Excise Duty paid on finished goods inventory as a pre - payment till the goods are sold and Excise Duty payable on such stock is not provided for and hence not included in the valuation of finished goods inventories.

9. Provisions, Contingent Liabilities:

A provision is recognized when the Company has present obligation as a result of past events and it is probable that an out flow of resources will be required to settle such obligation, in respect of which a reliable estimate can be made. Contingent liabilities not provided for in the accounts are disclosed in the account by way of notes specifying the nature and quantum of such liabilities.

10. Taxes on Income :

The current tax is determined as the amount of tax payable in respect of taxable income for the year. The deferred tax charge or credit is recognised using current tax rates and subject to the consideration of prudence,- or timing differences, being the difference between taxable income and accounting income that originatein one period and may be received in one or more subsequent periods, Deferred tax assets arising on account of brought forward losses, unabsorbed depreciation and other reasonable certainty of realisation.