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Accounting Policies of Delta Magnets Ltd. Company

Mar 31, 2015

A. Basis of Accounting

The financial statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles in India ("GAAP"), and comply with the accounting standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.

b. Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires judgments, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

c. Revenue Recognition

Income from sale of goods is recognized upon transfer of significant risk and rewards of ownership of the goods to the customer which generally coincides with delivery and acceptance of the goods sold.

Income from services is recognized when services are provided and there is no uncertainty as to its ultimate collectability.

Sales are net of returns, trade discounts, and allowances. Sales exclude excise duty and sales tax.

Interest Income is generally recognized on time proportion method.

Other incomes are recognized on accrual basis.

d. Fixed Assets

Fixed assets are stated at acquisition cost less accumulated depreciation and impairment losses if any. Cost of acquisition is inclusive of duties, taxes, freight and other directly attributable costs incurred to bring the assets to its working condition for intended use and are net of CENVAT credits as applicable. Borrowing cost directly attributable to acquisition of these fixed assets which necessarily take a substantial period of time to get ready for their intended use is capitalized.

Capital Work-In-Progress

Capital Work-In-Progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date. Advances given towards the acquisition of fixed assets are shown separately as capital advances under head long term loans & advances.

e. Depreciation Tangible Assets

Depreciation is provided on a pro-rata basis on the straight-line method at the rates prescribed under Schedule II of the Companies Act, 2013 with the exception of the following:

- Tools are depreciated over 5 years based on the technical evaluation of useful life done by the management.

- Remaining life of Factory Building as on 01.04.2015 is estimated 25 years based on the technical evaluation of useful life done by the management.

Leasehold assets are depreciated on a straight-line basis over the period of lease.

f. Employee Benefits

Liability is provided for retirement benefits for provident fund, gratuity and leave encashment in respect of all eligible employees. The Company has Gratuity Scheme with Life Insurance Corporation of India. Contributions under the defined contribution schemes are charged to revenue. The liability in respect of defined benefit schemes like gratuity and leave encashment is provided in the accounts on the basis of actuarial valuations as at the year end.

g. Inventories

Raw materials, stores, spares and components are stated cost or net realizable value whichever is lower. Cost includes freight, taxes and duties as applicable but excludes duties and taxes that are subsequently recoverable from tax authorities. Works-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes material cost, cost of conversion and other applicable overheads incurred in bringing them to their present location and condition. In accordance with Accounting Standard 2 issued by the Institute of Chartered Accountants of India, provision is made for excise duty on closing stock of finished goods. Cost is determined on weighted average cost method.

h. Investments

Investments that are readily realizable and intended to be held but not more than a year are classified as Current Investments. All other investments are classified as Long Term Investment. Carrying amount of the individual investment is determined on the basis of the average carrying amount of the total holding of the investments. Long-term investments are stated at cost less provision for other than temporary diminution in value. Current investments are carried at lower of cost and fair value.

i. Impairment of Assets

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

j. Taxation

Tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of profit and loss for the year.

i. Current Tax

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company.

ii. Deferred Tax

Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and taxable income for the year. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carry forward of losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each balance sheet date.

k. Contingent Liabilities and Provisions

i. Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of which can be reliably estimated.

ii. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future event not wholly within the control of the Company.

iii. Contingent assets are neither recognized nor disclosed in the financial statements.

iv. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

l. Foreign Currency Transactions

i. Foreign exchange transactions are recorded at the closing rate prevailing on the dates of the respective transaction. Exchange difference arising on foreign exchange transactions settled during the year is recognized in the statement of profit and loss.

ii. Monetary assets and liabilities denominated in foreign currencies are converted at the closing rate as on Balance Sheet date. The resultant exchange difference is recognized in the statement of profit and loss.

iii. Exchange rate differences arising on a monetary item that, in substance, forms part of the company's net investment in a non-integral foreign operation are accumulated in a foreign currency translation reserve in the company's financial statements until the disposal of the net investment.

iv. Non-monetary assets and liabilities denominated in foreign currencies are carried at the exchange rate prevalent on the date of the transaction.

m. Borrowing Costs

Borrowing costs that are directly attributable to and incurred on acquiring qualifying assets(assets that necessarily takes a substantial period of time for its intended use) are capitalized. Other borrowing costs are recognized as expenses in the period in which same are incurred.

n. Miscellaneous Expenditure

Preliminary expenditures are fully charged off in the year in which they are incurred.


Mar 31, 2014

A. Basis of Accounting

The financial statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles in India ("GAAP"), and comply with the accounting standards referred to in Sub-Section (3C) of Section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013.

b. Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires judgments, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known/materialized.

c. Revenue Recognition

Income from sale of goods is recognized upon transfer of significant risk and rewards of ownership of the goods to the customer which generally coincides with delivery and acceptance of the goods sold.

Income from services is recognized when services are provided and there is no uncertainty as to its ultimate collectability.

Sales are net of returns, trade discounts, and allowances. Sales excludes excise duty and sales tax.

Interest Income is generally recognized on time proportion method.

Other incomes are recognized on accrual basis.

d. Fixed Assets

Fixed assets are stated at acquisition cost less accumulated depreciation and impairment losses if any. Cost of acquisition is inclusive of duties, taxes, freight and other directly attributable costs incurred to bring the assets to its working condition for intended use and are net of CENVAT credits as applicable. Borrowing cost directly attributable to acquisition of these fixed assets which necessarily take a substantial period of time to get ready for their intended use is capitalized.

Capital Work-In-Progress

Expenses incurred for acquisition of capital assets outstanding at each balance sheet date are disclosed under capital work in progress. Advances given towards the acquisition of fixed assets are shown separately as capital advances under head long term loans & advances.

e. Depreciation

Depreciation on fixed assets is provided under the straight-line method based on management''s estimate of economic useful life of the assets and prorated over the period of use. The rates are higher than or equal to the minimum rates prescribed by Schedule XIV of the Companies Act, 1956.

f. Employee Benefits

Liability is provided for retirement benefits for provident fund, gratuity and leave encashment in respect of all eligible employees. The Company has Gratuity Scheme with Life Insurance Corporation of India. Contributions under the defined contribution schemes are charged to revenue. The liability in respect of defined benefit schemes like gratuity and leave encashment is provided in the accounts on the basis of actuarial valuations as at the year end.

g. Inventories

Raw materials, stores, spares and components are stated cost or net realizable value whichever is lower. Cost includes freight, taxes and duties as applicable but excludes duties and taxes that are subsequently recoverable from tax authorities. Works-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes material cost, cost of conversion and other applicable overheads incurred in bringing them to their present location and condition. In accordance with Accounting Standard 2 issued by the Institute of Chartered Accountants of India, provision is made for excise duty on closing stock of finished goods. Cost is determined on weighted average cost method.

h. Investments

Investments that are readily realizable and intended to be held but not more than a year are classified as Current Investments. All other investments are classified as Long Term Investment. Carrying amount of the individual investment is determined on the basis of the average carrying amount of the total holding of the investments. Long-term investments are stated at cost less provision for other than temporary diminution in value. Current investments are carried at lower of cost and fair value.

i. Impairment of Assets

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

j. Taxation

Tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of profit and loss for the year.

i. Current Tax

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company.

ii. Deferred Tax

Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and taxable income for the year. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carry forward of losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each balance sheet date.

k. Contingent Liabilities and Provisions

i. Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of which can be reliably estimated.

ii. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future event not wholly within the control of the Company.

iii. Contingent assets are neither recognized nor disclosed in the financial statements.

iv. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

l. Foreign Currency Transactions

i. Foreign exchange transactions are recorded at the closing rate prevailing on the dates of the respective transaction. Exchange difference arising on foreign exchange transactions settled during the year is recognized in the statement of profit and loss.

ii. Monetary assets and liabilities denominated in foreign currencies are converted at the closing rate as on Balance Sheet date. The resultant exchange difference is recognized in the statement of profit and loss.

iii. Exchange rate differences arising on a monetary item that, in substance, forms part of the company''s net investment in a non-integral foreign operation are accumulated in a foreign currency translation reserve in the company''s financial statements until the disposal of the net investment.

iv. Non monetary assets and liabilities denominated in foreign currencies are carried at the exchange rate prevalent on the date of the transaction.

m. Borrowing Costs

Borrowing costs that are directly attributable to and incurred on acquiring qualifying assets (assets that necessarily takes a substantial period of time for its intended use) are capitalized. Other borrowing costs are recognized as expenses in the period in which same are incurred.

n. Miscellaneous Expenditure

Preliminary expenditures are fully charged off in the year in which they are incurred.


Mar 31, 2013

A. Basis of accounting

The fnancial statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles in India ("GAAP"), the Accounting Standards ("AS") issued by the Institute of Chartered Accountants of India and the applicable relevant provisions of the Companies Act, 1956.

b. Revenue recognition

Income from sale of goods is recognized upon transfer of signifcant risk and rewards of ownership of the goods to the customer which generally coincides with delivery and acceptance of the goods sold. Income from services is recognized when service provided and there is no uncertainty as to its Ultimate collectability. Interest and other income are recognized on accrual basis.

c. Fixed Assets

All fxed assets are stated at cost of acquisition and include amounts added on revaluation, less accumulated depreciation, and impairment loss, if any. In the case of fxed assets acquired for new projects / expansion, fnance cost on borrowings and other related expenses up to the date of commercial production, incurred towards acquiring fxed assets are capitalized.

Capital Work-in-progress

Expenses incurred for acquisition of Capital Assets outstanding at each balance sheet date are disclosed under Capital Work-in-Progress. Advances given towards the acquisition of Fixed Assets are shown separately as Capital advances under head long term loans & advances.

d. Depreciation

Depreciation on fxed assets is provided as per the straight line method at the rates and in the manner specifed in Schedule XIV of the Companies Act, 1956. Depreciation on additions / deletions of assets during the year is provided on a pro-rata basis.

e. Retirement Benefts

Retirement beneft in the form of contribution to Provident Fund is charged to the Statement of Proft and Loss of the year when the contributions to the respective funds are due. The Company has Gratuity Scheme with Life Insurance Corporation of India. Liabilities with regard to Gratuity plan and Leave Encashment are determined by actuarial valuation at each Balance Sheet date. Short term and Long term employee benefts are recognized as expenses in the Statement of Proft and Loss.

f. Inventories

Raw Materials, Stores, Spares, Consumables, Packing Materials, and Work-in-Progress are valued at cost or net realizable value whichever is lower. Cost is ascertained on weighted average basis. Finished Goods are valued at lower of cost or net realizable value. Cost comprises of cost of purchase, cost of conversion, and other cost including manufacturing overheads incurred in bringing them to their present location and condition. In accordance with Accounting Standard-2 issued by the Institute of Chartered Accountants of India, provision is made for excise duty on closing stock of fnished goods.

g. Investments

Investments that are readily realizable and intended to be held but not more than a year are classifed as Current Investments. All other investments are classifed as Long Term Investment. Carrying amount of the individual investment is determined on the basis of the average carrying amount of the total holding of the investments.

h. Impairment of assets

An asset is treated as impaired when the carrying amount of an asset exceeds its recoverable value. An impairment loss is charged to the Proft & Loss Accounts in the year in which an asset is identifed as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

i. Taxation

Tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of proft and loss for the period.

i. Current Tax

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company.

ii. Deferred Tax

Deferred tax charge or credit refects the tax effects of timing differences between accounting income and taxable income for the period. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carry forward of losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each balance sheet date.

iii. Minimum Alternate Tax (MAT)

In case the Company is liable to pay income tax under provision of Minimum Alternate Tax u/s. 115JB of Income Tax Act, 1961, the amount of tax paid in excess of normal income tax liability is recognized as an asset only if there is convincing evidence for realization of such asset during the specifed period. MAT Credit Entitlement is recognized in accordance with the Guidance Note on accounting treatment in respect of Minimum Alternate Tax (MAT) issued by The Institute of Chartered Accountants of India.

j. Contingent liabilities and provisions

i. Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outfow of resources and the amount of which can be reliably estimated.

ii. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confrmed by the occurrence or non occurrence of one or more uncertain future event not wholly within the control of the Company.

iii. Contingent assets are neither recognized nor disclosed in the fnancial statements. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

k. Foreign currency Transactions:

i. Foreign exchange transactions are recorded at the closing rate prevailing on the dates of the respective transaction. Exchange difference arising on foreign exchange transactions settled during the year is recognized in the proft and loss account.

ii. Monetary assets and liabilities denominated in foreign currencies are converted at the closing rate as on Balance Sheet date. The resultant exchange difference is recognized in the proft and loss account.

iii. Exchange rate differences arising on a monetary item that, in substance, forms part of the Company''s net investment in a non-integral foreign operation are accumulated in a foreign currency translation reserve in the Company''s fnancial statements until the disposal of the net investment.

iv. Non monetary assets and liabilities denominated in foreign currencies are carried at the exchange rate prevalent on the date of the transaction.

l. Borrowing costs

Borrowing costs that are directly attributable to and incurred on acquiring qualifying assets (assets that necessarily takes a substantial period of time for its intended use) are capitalized. Other borrowing costs are recognized as expenses in the period in which same are incurred.

m. Miscellaneous Expenditure

Preliminary expenditures are fully charged off in the year in which they are incurred.


Mar 31, 2012

A. Basis of Accounting

The financial statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles in India ("GAAP"), the Accounting Standards ("AS") issued by the Institute of Chartered Accountants of India and the applicable relevant provisions of the Companies Act, 1956.

b. Revenue Recognition

Income from sale of goods is recognized upon transfer of significant risk and reward of ownership of the goods to the customer which generally coincides with delivery and acceptance of the goods sold. Income from services is recognized when there is no uncertainty as to its ultimate collectability. Interest and other income is recognized on accrual basis.

c. Fixed Assets

All fixed assets are stated at cost of acquisition and include amounts added on revaluation, less accumulated depreciation, and impairment loss, if any. In the case of fixed assets acquired for new projects / expansion, finance cost on borrowings and other related expenses up to the date of commercial production, incurred towards acquiring fixed assets are capitalized.

Capital Work-In-Progress

Expenses incurred for acquisition of Capital Assets outstanding at each balance sheet date are disclosed under Capital Work-in-Progress. From current year onwards advances given towards the acquisition of Fixed Assets are shown separately as Capital advances under head long term loans & advances.

d. Depreciation

Depreciation on fixed assets is provided as per the straight line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. Depreciation on additions / deletions of assets during the year is provided on a pro-rata basis.

e. Retirement Benefits

Retirement benefit in the form of contribution to Provident Fund is charged to the Profit and Loss Account of the year when the contributions to the respective funds are due. The Company has Gratuity Scheme with Life Insurance Corporation of India. Liabilities with regard to Gratuity plan and Leave Encashment are determined by actuarial valuation at each Balance Sheet date. Short term and Long term employee benefit are recognized as expenses in the Profit and Loss Account.

f. Inventories

Raw Materials, Stores, Spares, Consumables, Packing Materials, and Work-in-Progress are valued at cost or net realizable value whichever is lower. Cost is ascertained on weighted average basis. Finished Goods are valued at lower of cost or net realizable value. Cost comprises of cost of purchase, cost of conversion, and other cost including manufacturing overheads incurred in bring them to their present location and condition. In accordance with Accounting Standard 2 issued by the Institute of Chartered Accountants of India, provision is made for excise duty on closing stock of finished goods.

g. Investments

Investments that are readily realizable and intended to be held but not more than a year are classified as Current Investments. All other investments are classified as Long Term Investment. Carrying amount of the individual investment is determined on the basis of the average carrying amount of the total holding of the investments.

h. Impairment of Assets

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

i. Taxation

Tax expenses are the aggregate of current tax and deferred tax charged or credited in the statement of profit and loss for the period.

i Current Tax

The current charge for Income Tax is calculated in accordance with the relevant tax regulations applicable to the Company.

ii Deferred Tax

Deferred tax charge or credit reflects the tax effects of timing differences between accounting income and taxable income for the period. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognized using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, where there is unabsorbed depreciation or carry forward of losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each balance sheet date.

iii Minimum Alternate Tax (MAT)

In case the Company is liable to pay income tax under provision of Minimum Alternate Tax u/s. 115JB of Income Tax Act, 1961, the amount of tax paid in excess of normal income tax liability is recognized as an asset only if there is convincing evidence for realization of such asset during the specified period. MAT Credit Entitlement is recognized in accordance with the Guidance Note on accounting treatment in respect of Minimum Alternate Tax (MAT) issued by The Institute of Chartered Accountants of India.

j. Contingent Liabilities and Provisions

i. Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources and the amount of which an be reliably estimated.

ii. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future event not wholly within the control of the Company.

iii. Contingent assets are neither recognized nor disclosed in the financial statements. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

k. Foreign Currency Transactions:

Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currencies, if any at year end are restated at the yearend rate. Non monitory foreign currency items are carried at cost. Any gain or loss on account of exchange difference either on settlement or on translation is recognized in the Profit & Loss Account. Non monetary foreign currency items are carried at costs.

l. Borrowing Costs

Borrowing costs that are directly attributable to and incurred on acquiring qualifying assets (assets that necessarily takes a substantial period of time for its intended use) are capitalized. Other borrowing costs are recognized as expenses in the period in which same are incurred.

m. Miscellaneous Expenditure

Preliminary expenditures are fully charged off in the year in which it has incurred.


Mar 31, 2010

A. Basis of Accounting

The financial statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles in India ("GAAP"), the Accounting Standards ("AS") issued by the Institute of Chartered Accountants of India and the applicable relevant provisions of the Companies Act, 1956. The financial statements are presentedinIndian Rupees rounded offtothe nearest thousand.

b. Revenue Recognition

Income from sale of goods is recognized upon transfer of significant risk and reward of ownership of the goods to the customer which generally coincides with delivery and acceptance of the goods sold. Interest income is recognized on accrual basis.

c. Fixed Assets

All fixed assets are stated at cost of acquisition, less accumulated depreciation. In the case of fixed assets acquired for new projects / expansion, interest cost on borrowings and other related expenses upto the date of commercial production incurred towards acquiring fixed assets are capitalized.

d. Depreciation

Depreciation on fixed assets is provided as per the straight line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. Depreciation on additions / deletions of assets during the year is provided on a pro-rata basis.

e. Retirement Benefits

Retirement benefit in the form of contribution to Provident Fund is charged to the Profit and Loss Account of the period when the contributions to the respective funds are due. The company has gratuity scheme with Life Insurance Corporation of India. The premium thereofispaid in terms of the policy and charged to Profit and Loss Account. Leave encashment and other benefit are providedonthe basisofactuarial valuationatthe year end.

f. Inventories

Raw Materials, Stores, Spares, Consumables, Packing Material, and Work-in-Progress are valued at cost. Cost is ascertained on weighted average basis. WIP is valued at direct cost plus allocated overheads at appropriate stages. Finished Goods are valued at lower of cost or net realizable value. In accordance with Accounting Standard 2 issued by the Institute of Chartered Accountants of India, provision is made for excise duty on closing stock of finished goods.

g. Impairment of Assets

The Company evaluates all its assets for assessing any impairment and accordingly recognizes the impairment, wherever applicable,asprovidedinAccounting Standard 28, "ImpairmentofAssets".

h. Taxes on Income

Provision for current tax and fringe benefit tax is made, at the current rate of tax, based on assessable income computed on the basis of relevant tax rates and tax laws. Deferred tax resulting from timing differences between the book profits and the tax profits is accounted to the extent that the timing differences are expected to crystallize. Deferred tax assets are not recognized unless there is sufficient assurance with respect to reversal of the same in the future.

i. Contingent Liabilities and Provisions

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the Notes. Contingent Assets are neither recognized nor disclosed in the financial statements. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each balance sheet date.

j. Foreign Currency Transactions

Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currencies, if any at year end are restated at the year end rate. Any gain or loss on account of exchange difference either on settlement or on translation is recognized in the profit & loss account.

 
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