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Accounting Policies of Birla Corporation Ltd. Company

Mar 31, 2015

1 Basis of Accounting

The financial statements are prepared under the historical cost convention, except stated otherwise, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

The financial statements have been prepared and presented as per the requirement of Schedule III as notified under Companies Act 2013.

2 Use of Estimates

The preparation of financial statements require judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities including contingent liabilities on the date of the finanacial 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 the results are known/materialised.

1.3 Fixed Assets

Tangible Fixed Assets

a) Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses.In respect of qualifying assets as defined by Accounting Standard 16, related pre-operational expenses including borrowing cost are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled.

b) From accounting period commencing on or after 1st April,2011, the company adjusts exchange differences arising on translation/settlement of long term foreign currency monetary items pertaining to the acquisition of a depreciable asset to the cost of the asset and depreciates the same over the remaining life of the asset.

c) Revalued assets are stated at the values determined on revaluation.

d) Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payments.

Intangible Fixed Assets

Intangible assets are stated at cost on initial recognition, after which the same are stated at cost less accumulated amortisation and accumulated impairment loss, if any.

14 Depreciation and Amortisation

a) Depreciation on tangible fixed assets is provided on straight-line method at the rates determined based on the useful lives of respective assets as prescribed in the Schedule II of the Companies Act,2013.

b) In case the cost of part of a tangible asset is significant to the total cost of the assets and useful lives of that part is different from the remaining useful lives of the asset, depreciation has been provided on straight line method based on internal assessment and independent technical evaluation carried out by external valuers which the management believes that the useful lives of the component best represent the period over which the management expects to use those components.

c) Depreciation for assets purchased / sold during the year is proportionately charged.

d) Leasehold land is amortised over the period of lease.

e) On amount added on revaluation, depreciation is provided on straight-line method at the rates determined based on the useful lives of respective assets as prescribed in the Schedule II of the Companies Act.

f) Depreciation on assets built on leasehold land, which is transferable to the lessor on expiry of lease period, is amortised over the period of lease.

g) Intangible assets are amortised over a period of three years. The amortization period and the amortization method are reviewed atleast at the end of each financial year. If the expected useful life of the assets is significantly different from previous estimates, the amortisation period is changed accordingly.

15 Capital Work-in-Progress and Intangible assets under Development

a) Capital Work-in-Progress is stated at cost which includes expenses incurred during construction period, interest on amount borrowed for acquisition of qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production.

b) Intangible assets under development is stated at cost which includes expenses incurred in connection with development of Intangible Assets in so far as such expenses relate to the period prior to the getting the assets ready for use.

1.6 Investments

a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.The portion of long term investments expected to be realised within twelve months after the reporting date are disclosed under current investments as per the requirement of Schedule III of Companies Act,2013.

b) On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees & duties.

c) Long-Term Investments are stated at cost. Provision for diminution is made if the decline in value, in the opinion of the management, is other than temporary.

d) Current Investments, other than the portion of long term investments disclosed under current investments, are stated at lower of cost or fair value.

17 Inventories

Inventories are valued at Cost or Net Realisable Value, whichever is lower. Cost comprise all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition and is determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

18 Employee Benefits

a) Employee benefits of short term nature are recognized as expense as and when it accrues.

b) Employee benefits of long term nature are recognized as expense based on actuarial valuation using projected unit credit method.

c) Post employment benefits in the nature of Defined Contribution Plans are recognized as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognized as expenses based on actuarial valuation using projected unit credit method.

d) Actuarial gains and losses are recognized immediately in the Statement of Profit & Loss as income or expense.

e) Expenditure incurred on Voluntary Retirement Scheme is charged to the Statement of Profit & Loss immediately.

19 Foreign Currency Transactions and Derivatives

a) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year-end balance of foreign currency transactions is translated at the year-end rates.

b) The company has opted to avail the option provided under paragraph 46A of Accounting Standard-11 i.e The Effects of Changes in Foreign Exchange Rates inserted vide Notification dated December 29, 2011. Consequently, exchange differences arising on settlement of long-term monetary items or on period end reporting of long term monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements in so far as they relate to the acquisition of the depreciable capital asset, are added to/ deducted from the cost of the asset and depreciated over the balance useful life of the the asset, and in other cases, accumulated in "Foreign Currency Monetary Item Translation Difference Account" and amortized over the balance period of such long term asset or liability.

c) All other exchange differences are recognized as income or expense in the period in which they arise.

d) In respect of transactions covered by Forward/Future Contracts (except against firm commitments and highly probable forecast transactions), the premium or discount arising at the inception of Forward/Future Contracts entered into to hedge an existing asseVliability, is amortised over the life of the contract. Exchange differences on such contracts between rate at the inception of such contracts and rate on the reporting date are recognised as income or expense for the period.

e) Outstanding Forward/Future contracts against firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Statement of Profit & Loss. Gain, if any, on such marking to market is not recognised as a prudent accounting policy.

1.10 Recognition of Revenue and Expenses

a) All revenue and expenses are accounted for on accrual basis except as otherwise stated.

b) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

c) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

d) Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyer''s account as evidenced by the receipt of confirmation of execution of delivery instructions.

Ill Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961 The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing differences between book and tax profits. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. Tax credit for Minimum Alternate Tax (MAT) is recognised when there is convincing evidence of payment of normal income tax during the specified period.

12 Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognised as Other Operative Revenue or reduced from respective expenses.

13 Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful lives of the assets. An impairment loss is recognised as an expense in the Statement of Profit & Loss in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

1.14 Borrowing Costs

General and specific borrowing costs attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

1.15 Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date.

1.16 Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non- occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rate cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

a) There has been no change/movements in number of shares outstanding at the beginning and at the end of the reporting period.

b) The Company has only one class of issued shares i.e. Ordinary Shares having par value of Rs. 10/- per share. Each holder of Ordinary Shares is entitled to one vote per share and equal right for dividend. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the ordinary shareholders are eligible to receive the remaining assets of the Company after payment of all preferential amounts, in proportion to their shareholding.

c) The Company does not have any Holding Company/ultimate Holding Company.

d) Details of shareholders holding more than 5% shares in the Company :

e) No Ordinary Shares have been reserved for issue under options and contracts/commitments for the sale of shares/disinvestment as at the Balance Sheet date.

f) No shares have been allotted or bought back by the Company during the period of 5 years preceding the date as at which the Balance Sheet is prepared.

g) No securities convertible into Equity/Preference shares have been issued by the Company during the year. h) No calls are unpaid by any Director or Officer of the Company during the year.

a) Non-Convertible Debentures are redeemable fully at par as under : i) 9.05% NCD 2020 on 13th October, 2020;

ii) 9.10% NCD 2020 on 29th March, 2020;

iii) 8.80% NCD 2017 on 6th February, 2017;

The Debentures are secured by first charge on the movable and immovable fixed assets of the Company''s Cement Division, ranking pari-passu with other term lenders except Rupee loan for Jute Division.

b) Rupee Loan from Bank are repayable as under:-

Rs. 400.00 (RY. Rs. Nil) repayable in November, 2017.

The above loan is secured by hypothecation of plant and machineries purchased/to be purchased of the Company''s Jute Division.

c) Foreign Currency Loans from Banks are repayable as under:-

i) Rs. 6979.55 (RY. Rs. 7907.43) repayable in remaining eleven semi-annual instalments.

The above loan is secured by first charge on the movable and immovable fixed assets of the Company''s Cement Units at Chanderia (Rajasthan), ranking pari-passu with Debenture holders and other term lenders except Rupee Loan for Jute Division.

ii) Rs. 43753.50(RY Rs. 20972.00) includes Rs. 4687.88 repayable in September, 2015, Rs. 4687.88 repayable in September, 2016, Rs. 7813.12 repayable in September, 2017, Rs. 10938.37 repayable in September, 2018 and Rs. 15626.25 repayable in September, 2019.

iii) Rs. 15626.25 (RY. Rs. 14980.00) includes Rs. 4687.87 repayable in July/August, 2016 and Rs. 10938.38 repayable in December, 2016/January, 2017.

iv) Rs. 9375.75 (RY. Rs. 8988.00) includes Rs. 1250.10 repayable in March, 2018, Rs. 2500.20 repayable in June, 2018, Rs. 1875.15 repayable in September, 2018 and Rs. 3750.30 repayable in December, 2018.

The above loans are secured/are to be secured by first charge on the movable and immovable fixed assets of the Company''s Cement Division, ranking pari-passu with Debenture holders and other term lenders except Rupee Loan for Jute Division.

(a) Includes Rs. 8.85 in Land and Rs. 915.26 in Building under co-ownership basis and also Rs. 0.15 being value of investments in Shares of a Private Ltd.Co.

(b) Assets of the Cement Division were revalued during the year ended 31.03.85 and that of other units during the year ended 31.03.89 at ''net current value'' on the basis of valuation report made by valuers and the amount added on such revaluation were Rs. 7376.84 and Rs. 2006.35 respectively.

(c) Other adjustment includes adjustment on account of finance costs & foreign exchange differences pursuant to excercising option under paragraph 46A(1) of Accounting Standard-11 relating to "The Effects of Changes in Foreign Exchange Rates" as notified by the Ministry of Corporate Affairs on 29th December, 2011, Rs. 5036.22 remain unamortised as on 31st March, 2015.

(d) Effective from 1st April, 2014 the company has charged depreciation based on the remaining useful life of the assets as per the requirement of Schedule II of the Companies Act, 2013. Due to above, depreciation charged for the year ended 31st March, 2015 is higher by Rs. 1578.87.

(e) Deductions/ Adjustments under Depreciation includes Rs. 1343.56 adjusted with retained earnings related to assets whose remaining useful life was Nil as on 01/04/2014 based on tansitional provision of Schedule II of Companies Act, 2013.

* Amount is below the rounding off norms adopted by the company.

a) Deposited against Collaterized Borrowings and Lending Obligations except 1,000 Bonds of 6.05% GOI2019 and 1,00,000 Bonds of 7.80% GOI2021.

b) Deposited with Government Department as Security.

c) Portion of Long-Term Investments, as defined by Accounting Standard -13 Accounting for Investments'', which are expected to be realiased within twelve months from the Balance Sheet date are disclosed under the head ''Current portion of Long-Term Investments'' (See Note No. 2.14).

a) Portion of Long-Term Investments, as defined by Accounting Standard -13 ''Accounting for Investments'', which are expected to be realised within twelve months from the Balance Sheet date are disclosed as ''Current portion of Long-Term Investments''.

b) Lien Marked in favour of Banks.

c) 70,00,000 units of HDFC Medium Term Opportunities Fund Direct Plan - Growth have been pledged as margin money of Future contracts.


Mar 31, 2014

1.1 Basis of Accounting

The financial statements are prepared under the historical cost convention, except stated otherwise, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as notified by the Companies (Accounting Standard) Rules, 2006 (as amended) the relevant provisions of the Companies Act, 1956, and Companies Act, 2013 (as applicable).

The financial statements have been prepared and presented as per the requirement of Revised Schedule VI as notified under Companies Act 1956.

1.2 Use of Estimates

The preparation of financial statements require judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities including contingent liabilities on the date of the finanacial 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 the results are known/materialised.

1.3 Fixed Assets

Tangible Fixed Assets

a) Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses.In respect of qualifying assets as defined by Accounting Standard 16, related pre-operational expenses including borrowing cost are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled.

b) From accounting period commencing on or after 1st April,2011, the company adjusts exchange differences arising on translation/settlement of long term foreign currency monetary items pertaining to the acquisition of a depreciable asset to the cost of the asset and depreciates the same over the remaining life of the asset.

c) Revalued assets are stated at the values determined on revaluation.

d) Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payments.

Intangible Fixed Assets

Intangible assets are stated at cost on initial recognition, after which the same are stated at cost less accumulated amortisation and accumulated impairment loss, if any.

14 Depreciation and Amortisation

a) Depreciation on Tangible assets (other than livestock) is provided on Straight Line Method as follows :

i) On assets of Cement Division acquired after 1st April, 1987, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. On other assets of Cement Division, depreciation is provided on the specified period basis as per the rates as prescribed in Schedule XIV to the Companies Act, 1956 .

ii) On the assets of other Divisions, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. iii) On amount added on revaluation, depreciation is provided at the rates considered reasonable.

iv) On assets acquired under finance lease on or after 1st April, 2001, depreciation is provided at the rates precribed in Schedule XIV to the Companies Act,1956.

b) Leasehold land is amortised over the period of the lease.

c) Depreciation on assets built on leasehold land, which is transferable to the lessor on expiry of lease period, is amortised over the period of lease.

d) Intangible assets are amortised over a period of three years. The amortization period and the amortization method are reviewed atleast at the end of each financial year. If the expected useful life of the assets is significantly different from previous estimates, the amortisation period is changed accordingly.

15 Capital Work-in-Progress and Intangible assets under Development

a) Capital Work-in-Progress is stated at cost which includes expenses incurred during construction period, interest on amount borrowed for acquisition of qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production.

b) Intangible assets under development is stated at cost which includes expenses incurred in connection with development of Intangible Assets in so far as such expenses relate to the period prior to the getting the assets ready for use.

1.6 Investments

a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.The portion of long term investments expected to be realised within twelve months after the reporting date are disclosed under current investments as per the requirement of Revised Schedule VI.

b) On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees & duties.

c) Long-Term Investments are stated at cost. Provision for diminution is made if the decline in value, in the opinion of the management, is other than temporary.

d) Current Investments, other than the portion of long term investments disclosed under current investments, are stated at lower of cost or fair value.

1.7 Inventories

Inventories are valued at Cost or Net Realisable Value, whichever is lower. Cost comprise all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition and is determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

1.8 Employee Benefits

a) Employee benefits of short term nature are recognized as expense as and when it accrues.

b) Employee benefits of long term nature are recognized as expense based on actuarial valuation using projected unit credit method.

c) Post employment benefits in the nature of Defined Contribution Plans are recognized as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognized as expenses based on actuarial valuation using projected unit credit method.

d) Actuarial gains and losses are recognized immediately in the Statement of Profit & Loss as income or expense.

e) Expenditure incurred on Voluntary Retirement Scheme is charged to the Statement of Profit & Loss immediately.

1.9 Foreign Currency Transactions and Derivatives

a) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year-end balance of foreign currency transactions is translated at the year-end rates.

b) The company has opted to avail the option provided under paragraph 46A of Accounting Standard-11 i.e The Effects of Changes in Foreign Exchange Rates inserted vide Notification dated December 29, 2011. Consequently, exchange differences arising on settlement of long-term monetary items or on period end reporting of long term monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements in so far as they relate to the acquisition of the depreciable capital asset, are added to/ deducted from the cost of the asset and depreciated over the balance useful life of the the asset, and in other cases, accumulated in "Foreign Currency Monetary Item Translation Difference Account" and amortized over the balance period of such long term asset or liability.

c) All other exchange differences are recognized as income or expense in the period in which they arise.

d) In respect of transactions covered by Forward/Future Contracts (except against firm commitments and highly probable forecast transactions), the premium or discount arising at the inception of Forward/Future Contracts entered into to hedge an existing asseWiability, is amortised over the life of the contract. Exchange differences on such contracts between rate at the inception of such contracts and rate on the reporting date are recognised as income or expense for the period.

e) Outstanding Forward/Future contracts against firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Statement of Profit & Loss. Gain, if any, on such marking to market is not recognised as a prudent accounting policy.

1.10 Recognition of Revenue and Expenses

a) All revenue and expenses are accounted for on accrual basis except as otherwise stated.

b) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

c) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

d) Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyer''s account as evidenced by the receipt of confirmation of execution of delivery instructions.

111 Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing differences between book and tax profits. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. Tax credit for Minimum Alternate Tax (MAT) is recognised when there is convincing evidence of payment of normal income tax during the specified period.

112 Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognised as Other Operative Revenue or reduced from respective expenses.

113 Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the Statement of Profit & Loss in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

114 Borrowing Costs

General and specific borrowing costs attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

115 Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.

1.16 Contingent Liabilities

Contingent Liabilities are not provided for and are disclosed separately.

a) There has been no change/movements in number of shares outstanding at the beginning and at the end of the reporting period.

b) The Company has only one class of issued shares i.e. Ordinary Shares having par value of Rs. 10/- per share. Each holder of Ordinary Shares is entitled to one vote per share and equal right for dividend. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the ordinary shareholders are eligible to receive the remaining assets of the Company after payment of all preferential amounts, in proportion to their shareholding.

c) The Company does not have any Holding Company/ultimate Holding Company.

d) Details of shareholders holding more than 5% shares in the Company :

e) No Ordinary Shares have been reserved for issue under options and contracts/commitments for the sale of shares/disinvestment as at the Balance Sheet date.

f) No shares have been allotted or bought back by the Company during the period of 5 years preceding the date as at which the Balance Sheet is prepared.

g) No securities convertible into Equity/Preference shares have been issued by the Company during the year. h) No calls are unpaid by any Director or Officer of the Company during the year.

a) Non-Convertible Debentures are redeemable fully at par as under : i) 9.05% NCD 2020 on 13th October, 2020;

ii) 9.10% NCD 2020 on 29th March, 2020; iii) 8.80% NCD 2017 on 6th February, 2017; iv) 8.65% NCD 2015 on 4th March, 2015.

The Debentures are secured by first charge on the movable and immovable fixed assets of the Company''s Cement Division, ranking pari-passu with the term lenders.

b) Foreign Currency Loans from Banks are repayable as under:-

i) Rs. 7907.43 (RY. Rs. 8266.68) repayable in remaining thirteen semi-annual instalments.

The above loan is secured by first charge on the movable and immovable fixed assets of the Company''s Cement Units at Chanderia (Rajasthan), ranking pari-passu with Debenture holders and other term lenders.

ii) Rs. 20972.00 (RY. Rs. 19001.50) repayable in April/May, 2014 in two equal instalments.

iii) Rs. 20972.00(RY Rs. Nil) includes Rs. 2247.00 repayable in September, 2015, Rs. 2247.00 repayable in September, 2016, Rs. 3745.00 repayable in September, 2017, Rs. 5243.00 repayable in September, 2018 and Rs. 7490.00 repayable in September, 2019.

iv) Rs. 14980.00 (RY. Rs. 13572.50) includes Rs. 4494.00 repayable in July/August, 2016 - and Rs. 10486.00 repayable in December, 2016/January, 2017.

v) Rs. 8988.00 (RY. Rs. Nil) includes Rs. 1198.40 repayable in March, 2018, Rs. 2396.80 repayable in June, 2018, Rs. 1797.60 repayable in September, 2018 and Rs. 3595.20 repayable in December, 2018.

The above loans are secured/are to be secured by first charge on the movable and immovable fixed assets of the Company''s Cement Division, ranking pari-passu with Debenture holders and other term lenders.

During the year the Company has recognised Deferred Tax Assets of Rs. 226.60 on long term capital loss to the extent there is a certainty of reversal of the same in due course.

i) Working Capital Rupee Loans of Rs. 1882.36 (RY. Rs. 9589.40) from banks are secured by hypothecation of Current Assets.viz, Raw Materials.Stock- in-Trade, Consumable Stores and Book Debts, both present & future, and further by way of second charge on movable and immovable fixed assets of the Company''s Cement Division

ii) Working Capital Rupee Loans of Rs. 1779.62 (RY. Rs. Nil) and Buyers Credit in Foreign Currency of Rs. 1311.37 (RY. Rs. 1624.57) are secured against lien on certain Units of Mutual Funds.

iii) Collateralised Borrowing and Lending Obligation is secured by deposit of certain Government Securities.

a) Although the market value of Investment in Birla Ericsson Optical Ltd. is lower than cost, considering the long-term and strategic nature of the investment and the intrinsic worth of the company, in the opinion of the management, such decline is temporary in nature and no provision is necessary for the same.

b) Deposited against Collaterized Borrowings and Lending Obligations except face value of Rs. 1,00,000/- of 6.05% GOI2019.

c) Rs. 60,00,000 of 7.80% GOI 2021 earmarked against Rule 3A of The Companies (Acceptance & Deposit) Rules 1975.

d) Deposited with Government Departments as Security.

e) Portion of Long-Term Investments, as defined by Accounting Standard -13 Accounting for Investments'', which are expected to be realised within twelve months from the Balance Sheet date are disclosed under the head ''Current portion of Long-Term Investments'' (See Note No. 2.14).

a) Portion of Long-Term Investments, as defined by Accounting Standard - 13 ''Accounting for Investments'', which are expected to be realised within twelve months from the Balance Sheet date are disclosed as ''Current portion of Long-Term Investments''.

b) Lien Marked in favour of Banks.

c) 70,00,000 units of HDFC Medium Term Opportunities Fund Direct Plan - Growth have been pledged as margin money against foreign exchange future contracts.

2.27: EXCEPTIONAL ITEM

(a) Amortization of Foreign Currency Monetary Item Translation Difference Account of Rs. 2016.54 (Previous Year Rs. NIL) and Up front fees Rs. 625.80 (Previous Year Rs. NIL) on account of prepayment of Foreign Currency Loans of USD 70 million which have been refinanced at a lower rate.

(b) Write back of liability pursuant to the ruling of the Hon''ble Supreme Court according to which cement manufacturing units located outside the state of Uttar Pradesh are eligible to get "rebate of Sales Tax" granted by the state government for using fly ash generated in Uttar Pradesh as raw material.


Mar 31, 2013

1.1 Basis of Accounting

The financial statements are prepared under the historical cost convention, except stated otherwise, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as notified by the Companies (Accounting Standard) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.

The financial statements have been prepared and presented as per the requirement of revised Schedule VI as notified under Companies Act, 1956.

1.2 Use of Estimates

The preparation of financial statements require judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities including contingent liabilities on the date of the finanacial 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 the results are known/materialised.

1.3 Fixed Assets Tangible Fixed Assets

a) Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses. In respect of qualifying assets as defined by Accounting Standard 16, related pre-operational expenses including borrowing cost are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled.

b) From accounting period commencing on or after 1st April,2011, the company adjusts exchange differences arising on translation/settlement of long term foreign currency monetary items pertaining to the acquisition of a depreciable asset to the cost of the asset and depreciates the same over the remaining life of the asset.

c) Revalued assets are stated at the values determined on revaluation.

d) Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payments.

Intangible Fixed Assets

Intangible assets are stated at cost on initial recognition, after which the same are stated at cost less accumulated amortisation and accumulated impairment loss, if any.

1.4 Depreciation and Amortisation

a) Depreciation on Tangible assets (other than livestock) is provided on Straight Line Method as follows :

i) The assets of Cement Division acquired after 1st April, 1987, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. On other assets of Cement Division, depreciation is provided on the specified period basis as per the rates as prescribed in Schedule XIV to the Companies Act, 1956 .

ii) On the assets of other Divisions, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956.

iii) On amount added on revaluation, depreciation is provided at the rates considered reasonable.

iv) On assets acquired under finance lease on or after 1st April, 2001, depreciation is provided at the rates precribed in Schedule XIV to the Companies Act,1956.

b) Leasehold land is amortised over the period of the lease.

c) Depreciation on assets built on leasehold land, which is transferable to the lessor on expiry of lease period, is amortised over the period of lease.

d) Intangible assets are amortised over a period of three years. The amortisation period and the amortisation method are reviewed atleast at the end of each financial year. If the expected useful life of the assets is significantly different from previous estimates, the amortisation period is changed accordingly.

1.5 Capital Work-In-Progress and Intangible assets under Development

a) Capital Work-In-Progress is stated at cost which includes expenses incurred during construction period, interest on amount borrowed for acquisition of qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production.

b) Intangible assets under development is stated at cost which includes expenses incurred in connection with development of Intangible Assets in so far as such expenses relate to the period prior to the getting the assets ready for use.

1.6 Investments

a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

The portion of long-term investments expected to be realised within twelve months after the reporting date are disclosed under current investments as per the requirement of Revised Schedule VI.

b) On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees & duties.

c) Long-Term Investments are stated at cost. Provision for diminution is made if the decline in value, in the opinion of the management, is other than temporary.

d) Current Investments, other than the portion of long-term investments disclosed under current investments, are stated at lower of cost or fair value.

1.7 Inventories

Inventories are valued at Cost or Net Realisable Value, whichever is lower. Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition and is determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

1.8 Employee Benefits

a) Employee benefits of short-term nature are recognized as expense as and when it accrues.

b) Employee benefits of long-term nature are recognized as expense based on actuarial valuation using projected unit credit method.

c) Post employment benefits in the nature of Defined Contribution Plans are recognized as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognized as expense based on actuarial valuation using projected unit credit method.

d) Actuarial gains and losses are recognized immediately in the Statement of Profit & Loss Account as income or expense.

e) Expenditure incurred on Voluntary Retirement Scheme is charged to Statement of Profit & Loss Account immediately.

1.9 Foreign Currency Transactions and Derivatives

a) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year-end balance of foreign currency transactions is translated at the year-end rates.

b) The company has opted to avail the choice provided under paragraph 46A of Accounting Standard-11 i.e The Effects of Changes in Foreign Exchange Rates inserted vide Notification dated December 29, 2011. Consequently, exchange differences arising on settlement of long-term monetary items or on period end reporting of long-term monetary items at rates different from those at which they were initially recorded during the period or reported in previous Financial Statements in so far as they relate to the acquisition of the depreciable capital asset, are added to/ deducted from the cost of the asset and depreciated over the balance useful life of the asset.

c) All other exchange differences are recognised as income or expense in the period in which they arise.

d) In respect of transactions covered by Forward/Future Contracts (except against firm commitments and highly probable forecast transactions), the premium or discount arising at the inception of Forward/Future Contracts entered into to hedge an existing asset/liability, is amortised over the life of the contract. Exchange differences on such contracts between rate at the inception of such contracts and rate on the reporting date are recognised as income or expense for the period.

e) Outstanding Forward/Future contracts against firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Statement of Profit & Loss Account. Gain, if any, on such marking to market is not recognised as a prudent accounting policy.

1.10 Recognition of Revenue and Expenses

a) All revenue and expenses are accounted for on accrual basis except as otherwise stated.

b) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

c) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

d) Sale of Certified Emission Reductions (CERs) is recognised as income on the delivery of the CERs to the buyer''s account as evidenced by the receipt of confirmation of execution of delivery instructions.

1.11 Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961. The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing difference between book and tax profits. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxbale income will be available against which such deferred tax assets can be realised. Tax credit for Minimum Alternate Tax (MAT) is recognised when there is convincing evidence of payment of normal income tax during the specified period.

1.12 Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognised as Other Operative Revenue or reduced from respective expenses.

1.13 Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the Statement of Profit & Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

1.14 Borrowing Costs

General and specific borrowing costs attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

1.15 Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.

1.16 Contingent Liabilities

Contingent Liabilities are not provided for and are disclosed separately.


Mar 31, 2012

1.1 Basis of Accounting

The financial statements are prepared under the historical cost convention, except stated otherwise, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as notified by the Companies (Accounting Standard) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.

The financial statements had been prepared and presented as per the requirement of revised schedule VI as notified under Companies Act 1956 with effect from current year. The adoption of revised schedule VI does not have any impact on recognition and measurement principles as consistently followed by the company.

1.2 Use of Estimates

The preparation of financial statements require judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities including contingent liabilities on the date of the finanacial statements and the reported amount of revenues and expenses during the reporting period. Difference between actual results and estimates are recognised in the period in which the results are known/materialised.

1.3 Tangible and Intangible Fixed Assets Tangible Assets

a) Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses.In respect of qualifying assets as defined by Accounting Standard 16, related pre-operational expenses including borrowing costs are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled.

b) From accounting period commencing on or after 1st April,2011, the company adjusts exchange differences arising on translation/settlement of long term foreign currency monetary items pertaining to the acquisition of a depreciable asset to the cost of the asset.

c) Revalued assets are stated at the values determined on revaluation.

d) Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payments.

Intangible Assets

Intangible assets are stated at cost on initial recognition, after which the same are stated at cost less accumulated amortisation and accumulated impairment loss, if any.

1.4 Depreciation and Amortisation

a) Depreciation on tangible assets (other than livestock) is provided on Straight Line Method as follows :

i) On assets of Cement Division acquired after 1st April, 1987, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. On other assets of Cement Division, depreciation is provided on the specified period basis as per the rates as prescribed in Schedule XIV to the Companies Act, 1956.

ii) On the assets of other Divisions, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956.

iii) On amount added on revaluation, depreciation is provided at the rates considered reasonable.

iv) On assets acquired under finance lease on or after 1st April, 2001, depreciation is provided at the rates precribed in Schedule XIV to the Companies Act,1956.

b) Leasehold land is amortised over the period of the lease.

c) Depreciation on assets built on leasehold land, which is transferable to the lessor on expiry of lease period, is amortised over the period of lease.

d) Intangible assets are amortised on straight line basis over its estimated useful economic life. The amortisation period and the amortisation method are reviewed atleast at the end of each financial year. If the expected useful life of the assets is significantly different from previous estimates, the amortisation period is changed accordingly.

1.5 Capital Work-in-Progress and Intangible assets under Development

a) Capital Work-in-Progress is stated at cost which includes expenses incurred during construction period, interest on amount borrowed for acquisition of qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production.

b) Intangible assets under development is stated at cost which includes expenses incurred during devlopment period and all other expenses incurred in connection with development of Intangible Assets in so far as such expenses relate to the period prior to the getting the assets ready for use.

1.6 Investments

a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments. The portion of long term investments expected to be realised within twelve months after the reporting date are disclosed under current investments as per the requirement of revised schedule VI.

b) On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees & duties.

c) Long-Term Investments are stated at cost. Provision for diminution is made if the decline in value, in the opinion of the management, is other than temporary.

d) Current Investments, other than the portion of long term investments disclosed under current investments, are stated at lower of cost or fair value.

1.7 Inventories

Stock-in-Trade viz. Raw Materials, Finished Goods and Materials under Process and Traded Goods are valued at Cost or Net Realisable Value, whichever is lower. Cost of Raw Materials are determined on FIFO basis except for Jute Division where it is determined on weighted average basis. Cost of Finished Goods and Materials under Process are determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale. Stores and Spare Parts etc. are valued at cost determined on weighted average basis. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

1.8 Employee Benefits

a) Employee benefits of short term nature are recognised as expense as and when it accrues.

b) Employee benefits of long term nature are recognised as expense based on actuarial valuation using projected unit credit method.

c) Post employment benefits in the nature of Defined Contribution Plans are recognised as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognised as expenses based on actuarial valuation using projected unit credit method.

d) Actuarial gains and losses are recognised immediately in the Profit & Loss Account as income or expense.

e) Expenditure incurred on Voluntary Retirement Scheme is charged to Profit & Loss Account immediately.

1.9 Foreign Currency Transactions and Derivatives

a) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year-end balance of foreign currency transactions is translated at the year-end rates.

b) The company has opted to avail the choice provided under paragraph 46A of Accounting Standard-11 i.e The Effects of Changes in Foreign Exchange Rates inserted vide Notification dated December 29, 2011. Consequently, exchange differences arising on settlement of long-term monetary items or on reporting of long term monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements in so far as they relate to the acquisition of the depreciable capital asset, added to / deducted from the cost of the asset and depreciated over the balance useful life of the asset.

c) All other exchange differences are recognised as income or expense in the period in which they arise.

d) In respect of Forward Exchange Contracts (except for firm commitments and highly probable forecast transactions), the premium or discount arising at the inception of Forward Exchange Contracts entered into to hedge an existing asset/liability, is amortised over the life of the contract. Exchange differences between rate at the inception of such contracts and rate on the reporting date are recognised as income or expense for the period.

e) Outstanding forward contracts for firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Profit & Loss Account. Gain, if any, on such marking to market is not recognised as a prudent accounting policy.

1.10 Recognition of Revenue and Expenses

a) All revenue and expenses are accounted for on accrual basis except as otherwise stated.

b) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

c) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

d) Sale of Certified Emission Reductions (CERs) is recognised as income on the delivery of the CERs to the buyer's account as evidenced by the receipt of confirmation of execution of delivery instructions.

1.11 Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961. The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing differences between book and tax profits.

1.12 Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognised as Other Income or reduced from respective expenses.

1.13 Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the Profit & Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

1.14 Borrowing Costs

General and specific borrowing costs directly attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

1.15 Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.

1.16 Contingent Liabilities

Contingent Liabilities are not provided for and are disclosed separately.


Mar 31, 2011

(a) Basis of Accounting

The financial statements are prepared under the historical cost convention, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as notified by the Companies (Accounting Standard) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The preparation of financial statements require estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the finanacial 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 the results are known/materialised.

(c) Fixed Assets

Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses. In respect of qualifying assets, related pre-operational expenses including borrowing cost are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled. Revalued assets are stated at the values determined on revaluation.

Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payment

Capital Work in Progress is stated at cost which includes expenses incurred during construction period, interest on amount borrowed for acquisition of qualifying assets, advances to suppliers and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production.

(d) Depreciation

i) Depreciation on assets is provided on Straight Line Method as follows :

On assets of Cement Division acquired after 1st April, 1987, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. On other assets of Cement Division, depreciation is provided on the specified period basis as per the rates as prescribed in Schedule XIV to the Companies Act, 1956.

On the assets of other Divisions, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956.

On amount added on revaluation, depreciation is provided at the rates considered reasonable.

On assets acquired under finance lease on or after 1st April, 2001, depreciation is provided at the rates precribed in Schedule XIV to the Companies Act,1956.

ii) Leasehold land is amortised over the period of the lease.

iii) Depreciation on assets built on leasehold land, which is transferable to the lessor after the lease period is amortised over the lease period of the land.

(e) Investments

i) Long Term Investments are stated at cost. Provision for diminution in value is made if the decline in value is other than temporary in the opinion of the management.

ii) Current Investments are stated at lower of cost or fair value.

If) Inventories

i) Stock-in-Trade viz. Raw Materials, Finished Goods and Materials under Process are valued at Cost or Net Realisable Value, whichever is lower. Cost of Raw Materials are determined on FIFO basis except for Jute Division where it is determined on weighted average basis. Cost of Finished Goods and Materials under Process are determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale. Stores and Spare Parts etc. are valued at cost determined on weighted average basis. However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

ii) Machinery Spares not in regular use are written off over the estimated useful life of the respective assets.

iii) Excise Duty & Cess on finished goods are shown separately in (Increase)/Decrease in Stocks.

(g) Employee Benefits

i) Employee benefits of short term nature are recognized as expense as and when it accrues.

ii) Employee benefits of long term nature are recognized as expense based on actuarial valuation using projected unit credit method.

iii) Post employment benefits in the nature of Defined Contribution Plans are recognized as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognized as expenses based on actuarial valuation using projected unit credit method.

iv) Actuarial gains and losses are recognized immediately in the Profit & Loss Account as income or expense.

v) Expenditure incurred on Voluntary Retirement Scheme is charged to Profit & Loss Account immediately.

(h) Foreign Currency Transactions and Derivatives

i) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year end balance of foreign currency transactions is translated at the year end rates. Exchange differences arising on settlement of monetary items or on reporting of monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements are recognized as income or expense in the period in which they arise.

ii) In respect of transactions covered by Forward Exchange Contracts (except for firm commitments and highly probable forecast transactions), the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Exchange differences between rate at the inception of such contracts and rate on the reporting date are recognized as income or expense for the period.

iii) Outstanding forward contracts for firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Profit & Loss Account. Gain, if any, on such marking to market is not recognized as a prudent accounting policy.

(i) Recognition of Income and Expenditure

i) All Income and Expenditure are accounted for on accrual basis except as otherwise stated.

ii) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

iii) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

iv) Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyers account as evidenced by the receipt of confirmation of execution of delivery instructions.

0) Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961 The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing differences between book and tax profits.

Provision for wealth tax liability is estimated in accordance with the Wealth Tax Act, 1957.

(k) Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognized as Other Income or reduced from respective expenses.

(l) Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the Profit & Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

(m) Borrowing Costs

Interest and other borrowing costs directly attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

(n) Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.

(o) Contingent Liabilities

Contingent Liabilities are not provided for and are separately shown by way of a note in this Schedule.






Mar 31, 2010

(a) Baste of Accounting

The financial statements are prepared under the historical cost convention, on an accrual basis and in accordance with the generally accepted accounting principles in India, the applicable mandatory Accounting Standards as notified by the Companies (Accounting Standard) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The preparation of financial statements require 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 the results are known/materialised.

(c) Fixed Assets

Fixed Assets, other than those which have been revalued, are stated at their original cost which includes expenditure incurred in the acquisition and construction/installation and other related expenses. In respect of qualifying assets, related pre-operational expenses including interest are also capitalised and included in the cost. Claims in respect of capital assets are adjusted as and when settled. Revalued assets are stated at the values determined on revaluation.

Assets acquired under finance lease are recognised at lower of fair value or present value of minimum lease payments.

(d) Depreciation

i) Depreciation on assets is provided on Straight Line Method as follows :

On assets of Cement Division acquired after 1st April, 1987, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. On other assets of Cement Division, depreciation is provided on the specified period basis as per the rates as prescribed in Schedule XIV to the Companies Act, 1956.

On the assets of other Divisions, depreciation is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956. ¦

On amount added on revaluation, depreciation is provided at the rates considered reasonable.

ii) Leasehold land is amortised over the period of the lease.

iii) Depreciation on assets built on leasehold land, which is transferable to the lessor after the lease period is amortised over the lease period of the land.

(e) Investment.

i) Long Term Investments are stated at cost. Provision for diminution in value is made if the decline in value is other than temporary in the opinion of the management.

ii) Current Investments are stated at lower of cost or fair value.

(f) Inventories

i) Stock-in-Trade viz. Raw Materials, Finished Goods and Materials under Process are valued at Cost or Net Realisable Value, whichever is lower. Cost of Raw Materials are determined on FIFO basis except for Jute Division where It is determined on weighted average basis. Cost of Finished Goods and Materials under Process are determined on weighted average basis. Net Realisable Value is the estimated selling price in the ordinary course of business- less estimated cost of completion and the estimated cost necessary to make the sale. Stores and Spare Parts etc. are valued at cost determined on weighted average basis.

ii) Machinery Spares not in regular use are written off over the estimated useful life of the respective assets.

iii) Excise Duty & Cess on stocks are shown separately in (Incease)/Decrease in Stocks.

(g) Employee Benefit.

i) Employee benefits of short term nature are recognized as expense as and when it accrues.

ii) Employee benefits of long term nature are recognized as expense based on .actuarial valuation using projected unit credit method..

iii) Post employment benefits in the nature of Defined Contribution Plans are recognized as expense as and when it accrues and that in the nature of Defined Benefit Plans are recognized as expenses based on actuarial valuation using projected unit credit method.

iv) Actuarial gains and losses are recognized immediately in the Profit & Loss Account as income or expense,

v) Expenditure incurred on Voluntary Retirement Scheme is charged to Profit & Loss Account immediately..

(h) Foreign Currency Transactions and Derivatives

i) Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Year end balance of foreign currency transactions is translated at the year end rates. Exchange differences arising on settlement of monetary items or on reporting of monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements are recognized as income or expense in the period in which they arise.

ii) In respect of transactions covered by Forward Exchange Contracts (except for firm commitments and highly probable forecast transactions), the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Exchange differences between rate at the inception of such contracts and rate on the reporting date are recognized as income or expense for the period.

iii) Outstanding forward contracts for firm commitments and highly probable forecast transactions and derivative contracts, other than those stated above, are marked to market and the resulting loss, if any, is charged to the Profit and Loss Account. Gain, if any, on such marking to market is not recognized as a prudent accounting policy.

(1) Recognition of Income and Expenditure

i) All Income and Expenditure are accounted for on accrual basis except as otherwise stated.

ii) Gross Sales are inclusive of excise duty and net of returns, claims and discount etc.

iii) Export benefit entitlements to the Company under the EXIM/Foreign Trade Policy is recognised in the year of exports on accrual basis.

0) Taxation

Provision for Current Income Tax is made in accordance with the Income Tax Act, 1961. The deferred tax charge or credit is recognised using substantively enacted tax rates subject to consideration of prudence on timing differences between book and tax profits.

Fringe Benefit Tax are accounted for on the estimated value of fringe benefits for the period as per the provisions of the Income Tax Act, 1961.

Provision for wealth tax liability is estimated in accordance with the Wealth Tax Act, 1957.

(k) Government Grants

Grants received from Government agencies against specific fixed assets are adjusted to the cost of the assets and capital grants for Project Capital Subsidy are credited to Capital Reserve. Revenue Grants are recognized as Other Income or reduced from respective expenses.

(1) Impairment

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value being higher of value in use and net selling price. Value in use is computed at net present value of cash flow expected over the balance useful life of the assets. An impairment loss is recognised as an expense in the profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognised in earlier accounting period is reversed if there has been an improvement in recoverable amount.

(m) Borrowing Costs

Interest and other borrowing costs directly attributable to the acquisition, construction or installation of qualifying capital assets till the date of commencement of commercial use of the assets are capitalised. Other borrowing costs are recognised as an expense in the period in which they are incurred.

(n) Provisions

Provisions are recognised where reliable estimate can be made for probable outflow of resources to settle the present obligation as a result of past event and the same is reviewed at each Balance Sheet date.

(o) Contingent Liabilities

Contingent Liabilities are not provided for and are separately shown by way of a note in this Schedule.



 
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