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Accounting Policies of Damodar Industries Ltd. Company

Mar 31, 2015

A. Basis of Preparation of Financial Statements

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rule, 2006, (as amended) and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on an accrual basis and under the historical cost convention.

B. Use of Estimates

The preparation of Financial Statements in conformity with the Accounting Standards generally accepted in India requires, the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

C. Fixed Assets and Depreciation :

1 Fixed Assets are stated at historical cost of acquisition / construction less accumulated depreciation and impairment loss. Cost [ Net of Input tax credit received / receivable ] includes related expenditure and pre-operative & project expenses for the period up to completion of construction / assets are put to use. The loss or gain on exchange rates on long term foreign currency loans attributable to fixed assets is adjusted to the cost of respective fixed assets.

2 Depreciation is provided based on useful life of the assets as prescribed in Schedule II of the Companies Act 2013

3 Depreciation on impaired assets is calculated on its residual value, if any, on a systematic basis over its remaining useful life.

4 Capitalised costs incurred towards purchase/development of software are amortised using straight line method.

5 Depreciation on additions / disposals of the fixed assets during the year is provided on pro-rata basis according to the period during which assets are put to use.

D. Impairment of Assets :

The Company, at each balance sheet date, assesses whether there is any indication of impairment of any asset and / or cash generating unit. If such indication exists, assets are impaired by comparing carrying amount of each asset and / or cash generating unit to the recoverable amount being higher of the net selling price or value in use. Value in use is determined from the present value of the estimated future cash flows from the continuing use of the assets.

E. Borrowing Costs :

1 Borrowing costs that are directly attributable to the acquisition / constructions of a qualifying asset are capitalised as part of the cost of such assets, up to the date, the assets are ready for their intended use.

2 Other Borrowing costs are recognised as an expense in the period in which they are incurred.

3 Borrowing Costs also include Exchange differences arising from Foreign Currency borrowings to the extent that they are regarded as an adjustment to interest costs.

F. Expenditure during the Construction Period :

The expenditure incidental to the expansion / new projects are allocated to Fixed Assets in the year of commencement of the commercial production.

F. Investments :

Investments are stated at cost.

G. Inventories :

Raw Materials, Stores & Spare Parts, Packing Materials, Finished Goods,Trading Goods and Works-in- Progress are valued at lower of cost and net realisable value.

H Revenue Recognition :

1 Revenue from Sale of goods is recognised when significant risks and rewards of ownership of the goods have been passed to the buyer.

2 Dividend income is accounted for when received.

3 Interest income is recognised on time proportionate method.

4 Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

I. Derivative Instruments and Hedge Accounting :

The Company is exposed to foreign currency fluctuations on foreign currency assets, liabilities and forecasted cash flows denominated in foreign currency. The Company limits the effects of foreign exchange rates fluctuations by following established risk management policies, including use of derivatives. The company enters into forward, options & swap contracts where the counter parties are banks. Accordingly, losses in respect of all outstanding derivatives, contracts, other than forwards, options & swap contracts, at the year end by marking them to market are provided. However,out of prudence, the net gain, if any, on all such outstanding options & swap contracts is not accounted for.

J. Taxes on Income :

1 Tax expenses comprise of current and deferred tax.

2 Current tax is measured at the amount expected to be paid on the basis of reliefs and deductions available in accordance with the provisions of the Income Tax Act, 1961.

3 Deferred tax reflects the impact of current year timing differences between accounting and taxable income and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised and are reviewed at each balance sheet date.

K. Miscellaneous Expenditure :

Expenses are being written off in equal installments over a period of five financial years.

L. Gratuity /Retirement Benefits:

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the year end.

M. Transaction in Foreign Currency:

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end /contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets, if forign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.

N. Provisions, Contingent Liabilities and Contingent Assets :

Provision is recognised when the company has a present obligation as a result of past events and it is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made. A disclosure for contingent liability is made when there is a possible obligation, that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision / disclosure is made. Contingent assets are not recognised in the financial statements.Provisions and contingencies are reviewed at each balance sheet date and adjusted to reflect the correct management estimates.


Mar 31, 2014

A. Basis of Preparation of Financial Statements

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rule, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

B. Use of Estimates

The preparation of Financial Statements in conformity with the Accounting Standards generally accepted in India requires, the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

C. Fixed Assets and Depreciation :

1 Fixed Assets are stated at historical cost of acquisition / construction less accumulated depreciation and impairment loss. Cost [ Net of Input tax credit received / receivable ] includes related expenditure and pre-operative & projectexpenses for the period up to completion of construction / assets are put to use. The loss or gain on exchange rates on long term foreign currency loans attributable to fixed assets is adjusted to the cost of respective fixed assets.

2 Depreciation is provided on "straight line method" as per Section 205 (2) (b) of the Companies Act,1956 at the rates prescribed in Schedule XIV thereto.

3 Depreciation on impaired assets is calculated on its residual value, if any, on a systematic basis over its remaining useful life.

4 Capitalised costs incurred towards purchase/development of software are amortised using straight line method.

5 Depreciation on additions / disposals of the fixed assets during the year is provided on pro-rata basis according to the period during which assets are put to use.

D. Impairment of Assets :

The Company, at each balance sheet date, assesses whether there is any indication of impairment of any asset and / or cash generating unit. If such indication exists, assets are impaired by comparing carrying amount of each asset and / or cash generating unit to the recoverable amount being higher of the net selling price or value in use. Value in use is determined from the present value of the estimated future cash flows from the continuing use of the assets.

E. Borrowing Costs :

1 Borrowing costs that are directly attributable to the acquisition / constructions of a qualifying asset are capitalised as part of the cost of such assets, up to the date, the assets are ready for their intended use.

2 Other Borrowing costs are recognised as an expense in the period in which they are incurred.

3 Borrowing Costs also include Exchange differences arising from Foreign Currency borrowings to the extent that they are regarded as an adjustment to interest costs.

F. Expenditure during the Construction Period :

The expenditure incidental to the expansion / new projects are allocated to Fixed Assets in the year of commencement of the commercial production.

G. Investments :

Investments are stated at cost.

H. Inventories :

Raw Materials, Stores & Spare Parts, Packing Materials, Finished Goods,Trading Goods and Works-in- Progress are valued at lower of cost and net realisable value.

I Revenue Recognition :

1 Revenue from Sale of goods is recognised when significant risks and rewards of ownership of the goods have been passed to the buyer.

2 Dividend income is accounted for when received.

3 Interest income is recognised on time proportionate method.

4 Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

J. Derivative Instruments and Hedge Accounting :

The Company is exposed to foreign currency fluctuations on foreign currency assets, liabilities and forecasted cash flows denominated in foreign currency. The Company limits the effects of foreign exchange rates fluctuations by following established risk management policies, including use of derivatives. The company enters into forward, options & swap contracts where the counter parties are banks. Accordingly, losses in respect of all outstanding derivatives, contracts, other than forwards, options & swap contracts, at the year end by marking them to market are provided. However, out of prudence, the net gain, if any, on all such outstanding options & swap contracts is not accounted for.

K. Taxes on Income :

1 Tax expenses comprise of current and deferred tax.

2 Current tax is measured at the amount expected to be paid on the basis of reliefs and deductions available in accordance with the provisions of the Income Tax Act, 1961.

3 Deferred tax reflects the impact of current year timing differences between accounting and taxable income and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised and are reviewed at each balance sheet date.

L. Miscellaneous Expenditure :

Expenses are being written off in equal installments over a period of five financial years.

M. Gratuity /Retirement Benefits

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the year end.

N. Transaction in Foreign Currency

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end /contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets, if forign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.

O. Provisions, Contingent Liabilities and Contingent Assets :

Provision is recognised when the company has a present obligation as a result of past events and it is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made. A disclosure for contingent liability is made when there is a possible obligation, that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision / disclosure is made. Contingent assets are not recognised in the financial statements. Provisions and contingencies are reviewed at each balance sheet date and adjusted to reflect the correct management estimates.


Mar 31, 2013

A. Basis of Preparation of Financial Statements

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rule, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basisand underthe historical cost convention.

B. Use of Estimates

The preparation of Financial Statements in conformity with the Accounting Standards generally accepted in India requires, the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

C. Fixed Assets and Depreciation:

1 Fixed Assets are stated at historical cost of acquisition / construction less accumulated depreciation and impairment loss. Cost [ Net of Input tax credit received / receivable ] includes related expenditure and pre- operative & project expenses for the period up to completion of construction / assets are put to use. The loss or gain on exchange rates on long term foreign currency loans attributable to fixed assets is adjusted to the cost of respective fixed assets.

2 Depreciation is provided on "straight line method" as per Section 205 (2) (b) of the Companies Act, 1956 at the rates prescribed in Schedule XIV thereto.

3 Depreciation on impaired assets is calculated on its residual value, if any, on a systematic basis over its remaining useful life.

4 Capitalised costs incurred towards purchase/development of software are amortised using straight line method.

5 Depreciation on additions / disposals of the fixed assets during the year is provided on pro-rata basis according to the period during wnich assets are put to use.

D. Impairment of Assets:

The Company, at each balance sheet date, assesses whether there is any indication of impairment of any asset and /or cash generating unit. If such indication exists, assets are impaired by comparing carrying amount of each asset and / or cash generating unit to the recoverable amount being higher of the net selling price orvalue in use. Value in use is determined from the present value of the estimated future cash flows from the continuing use of the assets.

E. Borrowing Costs:

1 Borrowing costs that are directly attributable to the acquisition / constructions of a qualifying asset are capitalised as part of the cost of such assets, up to the date, the assets are ready fortheir intended use.

2 Other Borrowing costs are recognised as an expense in the period in which they are incurred.

3 Borrowing Costs also include Exchange differences arising from Foreign Currency borrowings to the extent that they are regarded as an adjustment to interest costs.

F. Expenditure during the Construction Period:

The expenditure incidental to the expansion / new projects are allocated to Fixed Assets in the year of commencement of the commercial production.

G. Investments:

Investments are stated at cost.

H. Inventories:

Raw Materials, Stores & Spare Parts, Packing Materials, Finished Goods/Trading Goods and Works-in- Progress are valued at lower of cost and net realisable value.

I. Revenue Recognition:

1 Revenue from Sale of goods is recognised when significant risks and rewards of ownership of the goods have been passed to the buyer.

2 Dividend income is accounted forwhen received.

3 Interest income is recognised on time proportionate method.

4 Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

J. Derivative Instruments and Hedge Accounting:

The Company is exposed to foreign currency fluctuations on foreign currency assets, liabilities and forecasted cash flows denominated in foreign currency. The Company limits the effects of foreign exchange rates fluctuations by following established risk management policies, including use of derivatives. The company enters into forward, options & swap contracts where the counter parties are banks. Accordingly, losses in respect of all outstanding derivatives, contracts, other than forwards, options & swap contracts, at the year end by marking them to market are provided. However, out of prudence, the net gain, if any, on all such outstanding options & swap contracts is not accounted for.

K. Taxes on Income:

1 Tax expenses comprise of current and deferred tax.

2 Current tax is measured at the amount expected to be paid on the basis of reliefs and deductions available in accordance with the provisions of the Income Tax Act, 1961.

3 Deferred tax reflects the impact of current year timing differences between accounting and taxable income and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised and are reviewed at each balance sheet date.

L. Miscellaneous Expenditure:

Expenses are being written off in equal installments over a period of five financial years.

M. Gratuity/Retirement Benefits

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the yearend.

N. Transaction in Foreign Currency

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction on currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end/contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets,if forign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.

O. Provisions, Contingent Liabilities and Contingent Assets:

Provision is recognised when the company has a present obligation as a result of past events and it is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made. A disclosure for contingent liability is made when there is a possible obligation, that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision / disclosure is made. Contingent assets are not recognised in the financial statements. Provisions and contingencies are reviewed at each balance sheet date and adjusted to reflect the correct management estimates.


Mar 31, 2012

A. Basis of Preparation of Financial Statements

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rule, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

B. Use of Estimates

The preparation of Financial Statements in conformity with the Accounting Standards generally accepted in India requires, the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

C. Fixed Assets and Depreciation:

1 Fixed Assets are stated at historical cost of acquisition / construction less accumulated depreciation and impairment loss. Cost [ Net of Input tax credit received / receivable] includes related expenditure and pre- operative & project expenses for the period up to completion of construction / assets are put to use. The loss or gain on exchange rates on long term foreign currency loans attributable to fixed assets is adjusted to the cost of respective fixed assets.

2 Depreciation is provided on "straight line method" as per Section 205 (2) (b) of the Companies Act,1956 at the rates prescribed in Schedule XIV thereto.

3 Depreciation on impaired assets is calculated on its residual value, if any, on a systematic basis over its remaining useful life.

4 Capitalised costs incurred towards purchase/development of software are amortised using straight line method.

5 Depreciation on additions / disposals of the fixed assets during the year is provided on pro-rata basis according to the period during which assets are put to use.

D. Impairment of Assets:

The Company, at each balance sheet date, assesses whether there is any indication of impairment of any asset and /or cash generating unit. If such indication exists, assets are impaired by comparing carrying amount of each asset and/ or cash generating unit to the recoverable amount being higher of the net selling price or value in use. Value in use is determined from the present value of the estimated future cash flows from the continuing use of the assets.

E. Borrowing Costs:

1 Borrowing costs that are directly attributable to the acquisition / constructions of a qualifying asset are capitalised as part of the cost of such assets, up to the date, the assets are ready for their intended use.

2 Other Borrowing costs are recognised as an expense in the period in which they are incurred.

3 Borrowing Costs also include Exchange differences arising from Foreign Currency borrowings to the extent that they are regarded as an adjustment to interest costs.

F. Expenditure during the Construction Period:

The expenditure incidental to the expansion / new projects are allocated to Fixed Assets in the year of commencement of the commercial production.

F. Investments:

Investments are stated at cost.

G. Inventories:

Raw Materials, Stores & Spare Parts, Packing Materials, Finished Goods, Trading Goods and Works-in-

Progress are valued at lower of cost and net realisable value.

H Revenue Recognition:

1 Revenue from Sale of goods is recognised when significant risks and rewards of ownership of the goods have been passed to the buyer.

2 Dividend income is accounted for when received.

3 Interest income is recognised on time proportionate method.

4 Revenue in respect of other income is recognised when no significant uncertainty as to its determination or realisation exists.

I. Derivative Instruments and Hedge Accounting:

The Company is exposed to foreign currency fluctuations on foreign currency assets, liabilities and forecasted cash flows denominated in foreign currency. The Company limits the effects of foreign exchange rates fluctuations by following established risk management policies, including use of derivatives. The company enters into forward, options & swap contracts where the counter parties are banks. Accordingly, losses in respect of all outstanding derivatives, contracts, other than options & swap contracts, at the year end by marking them to market are provided. However, out of prudence, the net gain, if any, on all such outstanding options & swap contracts is not accounted for.

J. Taxes on Income:

1 Tax expenses comprise of current and deferred tax.

2 Current tax is measured at the amount expected to be paid on the basis of reliefs and deductions available in accordance with the provisions of the Income Tax Act, 1961.

3 Deferred tax reflects the impact of current year timing differences between accounting and taxable income and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised and are reviewed at each balance sheet date.

K. Miscellaneous Expenditure:

Expenses are being written off in equal installments over a period of five financial years.

L. Gratuity/Retirement Benefits:

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the yearend.

M. Transaction in Foreign Currency:

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end /contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets, if foreign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.

N. Provisions, Contingent Liabilities and Contingent Assets:

Provision is recognised when the company has a present obligation as a result of past events and it is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made. A disclosure for contingent liability is made when there is a possible obligation, that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision/disclosure is made. Contingent assets are not recognised in the financial statements. Provisions and contingencies are reviewed at each balance sheet date and adjusted to reflect the correct management estimates.


Mar 31, 2011

I) Basis of Accounting :

All Income and expenditure items having a material bearing on the financial statements are recognised on accrual basis, except the items in respect of which it is not possible to ascertain with reasonable accuracy the quantum thereof.

ii) Fixed Assets :

(i) All fixed assets are valued at cost less depreciation.Pre-operative expenses including trial run expenses (net of revenue) are capitalised. Interest on borrowings and financing costs during the period of construction is added to cost of fixed assets.

(ii) Impairement loss ,if any is recognised in the year in which impairement takes place.

iii) Depreciation :

Depreciation on Fixed Assets is provided on Straight Line method at the rate and in the manner specified under Schedule XIV of the companies Act, 1956.

iv) Investments :

Investments are stated at cost. Dividend is accounted for when received.

v) Inventories :

Inventories are valued at the lower of cost or net realisable value.

vi) Miscellaneous Expenditure :

Expenses are being written off in equal installments over a period of five financial years.

vii) Gratuity /Retirement Benefits

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the year end.

viii) Sales :

Sales includes interest from debtors,export incentive,claims, sale of wastage, job work charges but net of sales discount and sales returns.

ix) Deferred Tax

Deferred Tax is accounted for by computing the the tax effect of timing differences which arise during the year and reverse in subsequent periods.

Deferred Tax Assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future.

x) Transaction in Foreign Currency

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end /contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets,if forign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.


Mar 31, 2010

I) Basis of Accounting :

All Income and expenditure items having a material bearing on the financial statements are recognised on accrual basis, except the items in respect of which it is not possible to ascertain with reasonable accuracy the quantum thereof.

ii) Fixed Assets:

(i) Ail fixed assets are valued at cost iess depreciation.Pre-operative expenses including trial run expenses (net of revenue) are capitalised Interest on borrowings and financing costs during the period of construction is added to cost of fixed assets.

(ii) Impairement loss ,if any is recognised in the year in which impairement takes place.

iii) Depreciation :

Depreciation on Fixed Assets is provided on Straight Line method at the rate and in the manner specified under Schedule XIV of the companies Act, 1956.

iv) Investments:

Investments are stated at cost. Dividend is accounted for when received.

v) Inventories :

Inventories are valued at the lower of cost or net realisable value.

vi) Miscellaneous Expenditure:

Expenses are being written off in equal installments over a period of five financial years.

vii) Gratuity /Retirement Benefits

(i) Gratuity liability is accounted as per the actuarial contribution demanded by Life Insurance Corporation of India.

(ii) Leave encashment is accounted for on the basis of accumulated leave to the credit of employees at the year end.

viii) Sales:

Sales includes interest from debtors.export incentive.daims, sale of wastage, job work charges but net of saies discount and sales returns.

ix) Deferred Tax

Deferred Tax is accounted for by computing the the tax effect of timing differences which arise during the year and reverse in subsequent periods.

Deferred Tax Assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future.

x) Transaction in Foreign Currency

Transaction in foreign currency are recorded at the rate of exchange in force on the respective date of such transactions. Foreign currency transaction remain unsettled as at the end of the year are translated at the year end /contracted rates .Exchange difference on repayment/conversion/translation are adjusted to

(i) Carrying cost of fixed assets,if forign currency liability relates to fixed assets.

(ii) the Profit & Loss account in other cases.

 
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