Mar 31, 2015
I) Basis of Accounting :
The financial statements are prepared under the historical cost
convention using accrual method of accounting in accordance with the
generally accepted accounting principles in India, unless otherwise
stated.
ii) Use of Estimates :
The preparation of financial statements requires estimates and
assumptions to be made based on the current working that affect the
reported amount of assets and liabilities (including contingent
liabilities) on the date of financial statements and the reported
amount of revenues and expenses for the reporting period. Difference
between the actual and the estimates, if any, are accounted for in the
period in which such differences are known/materialized.
iii) Fixed Assets :
Fixed assets are stated at its purchase price including direct
expenses, finance cost till it is put to use net of recoverable taxes.
If the fixed assets are revalued then they are stated at revalued
amount. Accumulated depreciation, impairment loss, if any, is reduced
from the fixed assets and shown under the net asset value on the
reporting date. The cost including additions, improvements, renewals,
revalued amount and accumulated depreciation of assets which are sold
and/or discarded and/or impaired, are removed from the fixed assets
and any profit or loss resulting there from is included in the
Statement of Profit & Loss and the residual value of the revalued
amount is withdrawn from such reserves created for the purpose.
iv) Leased Assets :
Leased assets are stated at premium paid on such assets. Rentals, if
any, are expensed with reference to the lease terms and other
conditions. No amortization of the lease premium in respect of Land is
done in cases where conditions are stipulated for conversion from
leasehold to freehold.
v) Depreciation :
Depreciation is calculated on all the fixed assets based on the method
prescribed under Schedule II of the Companies Act, 2013. Depreciation
on the assets hitherto calculated on Written Down Value/Straight Line
method is charged based on the remaining useful life of the assets as
prescribed under the Act. Depreciation on the assets added/disposed
off/impaired during the year is provided on pro-rata basis.
Depreciation on the revalued assets is calculated at the rates
prescribed under Schedule II of the Act and such depreciation is
withdrawn from capital reserve.
vi) Impairment of Assets :
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 recognized as an expense in the Statement of Profit
& Loss in the year in which an asset is identified as impaired. In
case of impaired revalued assets, the impaired loss on the residual
value is withdrawn from such reserves created for the purpose. The
impairment loss recognized in earlier accounting period is reversed if
there has been an improvement in recoverable amount.
vii) Capital Work-in-Progress :
Capital work-in-progress is stated at cost which includes expenses
incurred during the construction period, interest on account of
borrowed money for acquisition of assets and other expenses incurred
in connection with project implementation so far as such expenses
related to the assets prior to the commencement of the commercial
production.
viii) Foreign Currency Transactions :
a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction.
b) Year end balance of assets and liabilities in foreign currencies
are translated at the year-end rates and difference between year-end
balance and such restated balance are dealt in under Exchange rate
difference in the profit and loss statement.
c) The difference arising out of the actual settlement on realization
/ payment are dealt with in the Statement of Profit & Loss under
Exchange Rate Difference arising on such transactions.
d) The Company uses foreign currency forward contract and currency
options to hedge its risks associated with foreign currency
fluctuation relating to certain firm commitments and forecasted
transactions. The Company designates this hedging instruments as cash
flow hedges applying the recognition and measurement principles set
out in the Accounting Standard 30 'Financial Instruments: Recognition
and Measurement' (AS-30). Profit/loss over and above the
hedged/forecasted amounts are accounted for in the Statement of Profit
& Loss in the year of maturity.
ix) Investments :
Investments wherever readily realizable and intended to be held not
more than one year from the date of such investments are made, are
qualified as current investments. Current investments are carried at
lower of cost and quoted/fair value, computed category-wise.
Long-term investments are stated at cost. Provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary.
x) Inventories:
Items of inventories such as raw materials and Stock-in-Trade,
Finished Goods are measured at lower of cost or net realizable value
after providing for obsolescence if any. Work-in-progress is valued at
estimated cost and stocks & spare parts, dyes & chemicals, packing
materials etc. are valued at cost.
Work-in-progress comprises of cost of purchase, cost of conversion and
other costs including manufacturing overheads incurred in bringing
them in their present condition.
xi) Revenue Recognition :
Revenue is recognized only when it can be definitely measured and it
is reasonable to expect final collection. Revenue from operations
includes sale of goods after adjustment of discounts (net) and return
of goods. Earnest deposits from customers are recognized as Revenue on
obligatory failures. Export benefit entitlement to the Company under
Drawback, DEPB, DfIA is recognized in the year of export on accrual
basis wherever it is ascertainable with reasonable accuracy.
Dividend income is recognized on actual receipt basis.
xii) Employee Benefits :
a) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
b) Post employment Benefits
1) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trust administered by the Company, the interest rate payable to the
members of the Trust is not lower than the rate of interest declared
annually by the Central Government under the Employees' Provident
Funds and Miscellaneous Provisions Act, 1952 and shortfall if any, is
made good by the Company. The remaining provident fund contributions
are made to government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
2) Defined Benefit Plans
Liability towards gratuity, covering eligible employees is provided
and funded through LIC managed Group Gratuity Policy on the basis of
year end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees' State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
in the Statement of Profit and Loss as income/expense for the year in
which they occur.
xiii) Borrowing Cost :
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized
as an expense in the period in which they are incurred. Capitalization
of borrowing costs ceases when the qualifying asset is ready for
intended use .
xiv) Deferred Taxation :
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax
rates prevailing at the time of Balance Sheet date. Deferred Taxation
so provided is reviewed at each Balance Sheet date for necessary
adjustments.
xv) Earning per Share :
Basic earning per share is calculated by dividing the net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average
number of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by weighted average number of equity
shares outstanding during the year after adjusting for the effects of
dilutive options.
xvi) Events occurring after Balance Sheet Date :
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
xvii) Contingent Liabilities :
Unprovided liabilities of contingent nature are disclosed in the
accounts by way of notes giving nature and quantum of such
liabilities.
xviii) Research & Development Expenditure :
a) Capital Expenditure is included in Fixed Assets and depreciation is
provided as per Schedule II of the Companies Act, 2013.
b) Revenue Expenditure is charged in the Statement of Profit & Loss
during the year in which they are incurred.
xix) Cash Flow Statement :
The Company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalents consists of Cash on Hand, Cash at Bank, Term Deposits &
Cheques in Hand.
a) There is no change/movement in number of shares outstanding at the
beginning and at the end of the reporting period.
b) The Company has two class of issued shares i.e. Equity Shares of Rs.
2/- each and Redeemable Cumulative Preference Shares of Rs. 100/- each.
Every Equity Share is entitled to one vote and equal right for
dividend after payment of preference dividend to preference share
holders. The dividend proposed by the Board of Directors is subject to
approval of shareholders in the ensuing Annual General Meeting,except
in case of interim dividend. In the event of liquidation,the share
holders 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.
d) Details of shareholders holding more than 5% shares in the Company.
e) No Equity 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 has been bought back by the Company
during the 5 years preceding the date at which Balance Sheet is
prepared.
Mar 31, 2014
I) Basis of Accounting :
The financial statements are prepared under the historical cost
convention in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956 and
wherever applicable as per the provisions of the Companies Act, 2013.
ii) Use of Estimates :
The preparation of financial statements requires estimates and
assumptions to be made based on the current working that affect the
reported amount of assets and liabilities (including contingent
liabilities) on the date of financial statements and the reported
amount of revenues and expenses for the reporting period. Difference
between the actual and the estimates, if any, are accounted for in the
period in which such differences are known/materialized.
iii) Fixed Assets :
Fixed assets are stated at its purchase price including direct
expenses, finance cost till it is put to use net of recoverable taxes.
If the fixed assets are revalued then they are stated at revalued
amount. Accumulated depreciation, impairment loss, if any, is reduced
from the fixed assets and shown under the net asset value on the
reporting date. The cost including additions, improvements, renewals,
revalued amount and accumulated depreciation of assets which are sold
and/or discarded and/or impaired, are removed from the fixed assets and
any profit or loss resulting there from is included in the Statement of
Profit & Loss and the residual value of the revalued amount is
withdrawn from such reserves created for the purpose.
iv) Leased Assets :
Leased assets are stated at premium paid on such assets. Rentals, if
any, are expensed with reference to the lease terms and other
conditions. No amortization of the lease premium in respect of Land is
done in cases where conditions are stipulated for conversion from
leasehold to freehold.
v) Depreciation and Amortization :
Depreciation is provided on Written Down Value method except for Unit 1
& Unit 3 which are provided on Straight Line Method at the rates
prescribed in Schedule XIV of the Companies Act, 1956. Depreciation of
the assets added / disposed off / impaired during the year is provided
on pro-rata basis.
Depreciation on revalued assets is provided on Straight Line Method
over the residual life of the respective assets. The charge for
depreciation on account of revaluation is withdrawn from capital
reserve.
Wherever amortization charges are required to be provided, the same is
done over the useful life of the underlying assets based on technical
evaluation.
vi) Impairment of Assets :
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 recognized as an expense in the Statement of Profit & Loss in
the year in which an asset is identified as impaired. In case of
impaired revalued assets, the impaired loss on the residual value is
withdrawn from such reserves created for the purpose. The impairment
loss recognized in earlier accounting period is reversed if there has
been an improvement in recoverable amount.
vii) Capital Work-in-Progress :
Capital work-in-progress is stated at cost which includes expenses
incurred during the construction period, interest on account of
borrowed money for acquisition of assets and other expenses incurred in
connection with project implementation so far as such expenses related
to the assets prior to the commencement of the commercial production.
viii) Foreign Currency Transactions :
a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction.
b) Year end balance of assets and liabilities in foreign currencies are
translated at the year end rates and difference between year end
balance and such restated balance are dealt in under Exchange rate
difference in the profit and loss statement.
c) The difference arising out of the actual settlement on realization /
payment are dealt with in the Statement of Profit & Loss under Exchange
Rate Difference arising on such transactions.
d) The Company uses foreign currency forward contract and currency
options to hedge its risks associated with foreign currency fluctuation
relating to certain firm commitments and forecasted transactions. The
Company designates this hedging instruments as cash flow hedges
applying the recognition and measurement principles set out in the
Accounting Standard 30 ''Financial Instruments: Recognition and
Measurement'' (AS-30). Profit/loss over and above the hedged/forecasted
amounts are accounted for in the Statement of Profit & Loss in the year
of maturity.
ix) Investments :
Investments wherever readily realizable and intended to be held not
more than one year from the date of such investments are made, are
qualified as current investments. Current investments are carried at
lower of cost and quoted/fair value, computed category-wise.
Long-term investments are stated at cost. Provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary.
x) Inventories:
Items of inventories such as raw materials and Stock-in-Trade, Finished
Goods are measured at lower of cost or net realizable value after
providing for obsolescence if any. Work-in-progress is valued at
estimated cost and stocks & spare parts, dyes & chemicals, packing
materials etc. are valued at cost.
Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads incurred in bringing
them in their present condition. Cost of raw materials, stock in
process, stock in trade and finished goods are determined on average
cost basis.
xi) Revenue Recognition :
Revenue is recognized only when it can be definitely measured and it is
reasonable to expect final collection. Revenue from operations
includes sale of goods after adjustment of discounts (net) and return
of goods. Export benefit entitlement to the Company under Drawback,
DEPB, DFIA is recognized in the year of export on accrual basis
wherever it is ascertainable with reasonable accuracy.
Dividend income is recognized on actual receipt basis.
Interest income is recognized on time proportion basis taking into
account the amount outstanding and rate applicable.
xii) Employee Benefits :
a) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
b) Post employment Benefits
1) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trust administered by the Company, the interest rate payable to the
members of the Trust is not lower than the rate of interest declared
annually by the Central Government under the Employees'' Provident Funds
and Miscellaneous Provisions Act, 1952 and shortfall if any, is made
good by the Company. The remaining provident fund contributions are
made to government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
2) Defined Benefit Plans
Liability towards gratuity, covering eligible employees is provided and
funded through LIC managed Group Gratuity Policy on the basis of year
end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees'' State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
immediately in the Statement of Profit and Loss as income/expense for
the year in which they occur.
xiii) Borrowing Cost :
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized as
an expense in the period in which they are incurred. Capitalization of
borrowing costs ceases when the qualifying asset is ready for intended
use .
xiv) Deferred Taxation :
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax rates
prevailing at the time of Balance Sheet date. Deferred Taxation so
provided is reviewed at each Balance Sheet date for necessary
adjustments.
xv) Earning per Share :
Basic earning per share is calculated by dividing the net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average number
of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by weighted average number of equity
shares outstanding during the year after adjusting for the effects of
dilutive options.
xvi) Events occurring after Balance Sheet Date :
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
xvii) Contingent Liabilities :
Unprovided liabilities of contingent nature are disclosed in the
accounts by way of notes giving nature and quantum of such liabilities.
xviii) Research & Development Expenditure :
a) Capital Expenditure is included in Fixed Assets & Capital
Work-in-Progress and depreciation is provided at the respective
applicable rates.
b) Revenue Expenditure is charged in the year in which they are
incurred.
xix) Cash Flow Statement :
The Company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalents consists of Cash on Hand, Cash at Bank.
Mar 31, 2013
I) Basis of Accounting :
The financial statements are prepared under the historical cost
convention in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956.
ii) Use of Estimates :
The preparation of financial statements requires estimates and
assumptions to be made based on the current working that affect the
reported amount of assets and liabilities (including contingent
liabilities) on the date of financial statements and the reported
amount of revenues and expenses for the reporting period. Difference
between the actual and the estimates, if any, are accounted for in the
period in which such differences are known/materialized.
iii) Fixed Assets :
Fixed assets are stated at its purchase price including direct
expenses, finance cost till it is put to use net of recoverable taxes.
If the fixed assets are revalued then they are stated at revalued
amount. Accumulated depreciation, impairment loss, if any, is reduced
from the fixed assets and shown under the net asset value on the
reporting date. The cost including additions, improvements, renewals,
revalued amount and accumulated depreciation of assets which are sold
and/or discarded and/or impaired, are removed from the fixed assets and
any profit or loss resulting there from is included in the Statement of
Profit & Loss and the residual value of the revalued amount is
withdrawn from such reserves created for the purpose.
iv) Leased Assets :
Leased assets are stated at premium paid on such assets. Rentals, if
any, are expensed with reference to the lease terms and other
conditions. No amortization of the lease premium in respect of Land is
done in cases where conditions are stipulated for conversion from
leasehold to freehold.
v) Depreciation and Amortization :
Depreciation is provided on Written Down Value method except for Unit 1
& Unit 3 which are provided on Straight Line Method at the rates
prescribed in Schedule XIV of the Companies Act, 1956. Depreciation of
the assets added / disposed off / impaired during the year is provided
on pro-rata basis.
Depreciation on revalued assets is provided on Straight Line Method
over the residual life of the respective assets. The charge for
depreciation on account of revaluation is withdrawn from capital
reserve.
Wherever amortization charges are required to be provided, the same is
done over the useful life of the underlying assets based on technical
evaluation.
vi) Impairment of Assets :
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 recognized as an expense in the Statement of Profit & Loss in
the year in which an asset is identified as impaired. In case of
impaired revalued assets, the impaired loss on the residual value is
withdrawn from such reserves created for the purpose. The impairment
loss recognized in earlier accounting period is reversed if there has
been an improvement in recoverable amount.
vii) Capital Work-in-Progress :
Capital work-in-progress is stated at cost which includes expenses
incurred during the construction period, interest on account of
borrowed money for acquisition of assets and other expenses incurred in
connection with project implementation so far as such expenses related
to the assets prior to the commencement of the commercial production.
viii) Foreign Currency Transactions :
a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction.
b) Year end balance of assets and liabilities receivables / payables in
foreign currency is translated at the year end rates.
c) The difference arising out of the actual settlement on realization /
payment are dealt with in the Statement of Profit & Loss under Exchange
Rate Difference arising on such transactions.
d) The Company uses foreign currency forward contract and currency
options to hedge its risks associated with foreign currency fluctuation
relating to certain firm commitments and forecasted transactions. The
Company designates this hedging instruments as cash flow hedges
applying the recognition and measurement principles set out in the
Accounting Standard 30 ''Financial Instruments: Recognition and
Measurement'' (AS-30). Profit/loss over and above the hedged/forecasted
amounts are accounted for in the Statement of Profit & Loss in the year
of maturity.
ix) Investments :
Investments wherever readily realizable and intended to be held not
more than one year from the date of such investments are made, are
qualified as current investments. Current investments are carried at
lower of cost and quoted/fair value, computed category-wise.
Long-term investments are stated at cost. Provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary.
x) Inventories:
Items of inventories such as raw materials and Stock-in-Trade, Finished
Goods are measured at lower of cost or net realizable value after
providing for obsolescence if any. Work-in-progress is valued at
estimated cost and stocks & spare parts, dyes & chemicals, packing
materials etc. are valued at cost.
Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads incurred in bringing
them in their present condition. Cost of raw materials, stock in
process, stock in trade and finished goods are determined on average
cost basis.
xi) Revenue Recognition :
Revenue is recognized only when it can be definitely measured and it is
reasonable to expect final collection.
Revenue from operations includes sale of goods after adjustment of
discounts (net) and return of goods.
Export benefit entitlement to the Company under Drawback, DEPB, DFIA is
recognized in the year of export on accrual basis wherever it is
ascertainable with reasonable accuracy.
Dividend income is recognized on actual receipt basis. Interest income
is recognized on time proportion basis taking into account the amount
outstanding and rate Applicable.
xii) Employee Benefits :
a) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
b) Post employment Benefits
1) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trust administered by the Company, the interest rate payable to the
members of the Trust is not lower than the rate of interest declared
annually by the Central Government under the Employees'' Provident Funds
and Miscellaneous Provisions Act, 1952 and shortfall if any, is made
good by the Company. The remaining provident fund contributions are
made to government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
2) Defined Benefit Plans
Liability towards gratuity, covering eligible employees is provided and
funded through LIC managed Group Gratuity Policy on the basis of year
end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees'' State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
immediately in the Statement of Profit and Loss as income/expense for
the year in which they occur.
xiii) Borrowing Cost :
Borrowing3 costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized as
an expense in the period in which they are incurred. Capitalization of
borrowing costs ceases when the qualifying asset is ready for intended
use .
xiv) Deferred Taxation :
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax rates
prevailing at the time of Balance Sheet date. Deferred Taxation so
provided is reviewed at each Balance Sheet date for necessary
adjustments.
xv) Earning per Share :
Basic earning per share is calculated by dividing the Net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average number
of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the Net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by weighted average number of equity
shares outstanding during the year after adjusting for the effects of
dilutive options.
xvi) Events occurring after Balance Sheet Date :
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
xvii) Contingent Liabilities :
Unprovided liabilities of contingent nature are disclosed in the
accounts by way of notes giving nature and quantum of such liabilities.
xviii) Research & Development Expenditure :
a) Capital Expenditure is included in Fixed Assets & Capital
Work-in-Progress and depreciation is provided at the respective
applicable rates.
b) Revenue Expenditure is charged in the year in which they are
incurred.
xix) Cash Flow Statement :
The Company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalents consists of Cash on Hand, Cash at Bank.
Mar 31, 2012
I) Basis of Accounting:
The financial statements are prepared under the historical cost
convention in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956.
ii) Use of Estimates:
The preparation of financial statements requires estimates and
assumptions to be made based on the current working, that affect the
reported amount of assets and liabilities (including contingent
liabilities) on the date of financial statements and the reported
amount of revenues and expenses during the reporting period.
Difference between the actual results and estimates, if any, are
accounted for in the period in which such differences are
known/materialized.
iii) Fixed Assets:
Fixed assets are stated at cost net of recoverable taxes, if any, and
if revalued at the revalued amount. Accumulated depreciation,
impairment loss, if any, is reduced from the fixed assets and shown
under the net asset value on the reporting date. Cost of assets
comprise its purchase price, direct expenses incurred including finance
cost till it is put to use and the revalued amount if any. The cost
including additions, improvements, renewals, revalued amount and
accumulated depreciation of assets which are sold and/or discarded
and/or impaired, are removed from the fixed assets and any profit or
loss resulting there from is included in the Statement of Profit &
Loss.
iv) Leased Assets:
Leased assets are stated at premium paid on such assets. Rentals, if
any, are expensed with reference to the lease terms and other
conditions. No amortization of the lease premium in respect of Land is
done in cases where conditions are stipulated for conversion from
leasehold to freehold.
v) Depreciation and Amortization :
Depreciation is provided on Written Down Value method except for Unit 1
& Unit 3 which are provided on Straight Line Method at the rates
prescribed in Schedule XIV of the Companies Act, 1956. Depreciation of
the assets added/disposed off/impaired during the year is provided on
pro-rata basis.
Depreciation on revalued assets is provided on Straight Line Method
over the residual life of the respective assets as estimated by valuer.
The charge for depreciation on account of revaluation is withdrawn from
capital reserve.
Wherever amortization charges are required to be provided, the same is
done over the useful life of the underlying assets based on technical
evaluation.
vi) Impairment of Assets:
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 recognized as an expense in the Statement of Profit & Loss in
the year in which an asset is identified as impaired. The impairment
loss recognized in earlier accounting period is reversed if there has
been an improvement in recoverable amount.
vii) Capital Work-in-Progress:
Capital work-in-progress is stated at cost which includes expenses
incurred during the construction period, interest on account of
borrowed money for acquisition of assets and other expenses incurred in
connection with project implementation so far as such expenses related
to the assets prior to the commencement of the commercial production.
viii) Foreign Currency Transactions:
a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of transaction
b) Yearend balance of foreign currency transaction is translated at the
year end rates.
c) The difference arising out of the actual settlement on realization /
payment are dealt with in the Statement of Profit & Loss under Exchange
Rate Difference arising on such transactions.
d) The Company uses foreign currency forward contract and currency
options to hedge its risks associated with foreign currency fluctuation
relating to certain firm commitments and forecasted transactions. The
Company designates this hedging instruments as cash flow hedges
applying the recognition and measurement principles set out in the
Accounting Standard 30 'Financial Instruments: Recognition and
Measurement' (AS-30). Profit/loss over and above the hedged/forecasted
amounts are accounted for in the Statement of Profit & Loss in the year
of maturity.
ix) Investments:
Investments wherever readily realizable and intended to be held not
more than one year from the date of such investments are made, are
qualified as current investments. Current investments are carried at
lower of cost and quoted/fair value, computed category-wise.
Long-term investments are stated at cost. Provision for diminution in
the value of long-term investments is made only if such a decline is
other than temporary.
x) Inventories:
Items of inventories such as raw materials and Stock-in-Trade, Finished
Goods are measured at lower of cost or net realizable value after
providing for obsolescence if any. Work-in-progress is valued at
estimated cost and stocks & spare parts, dyes & chemicals, packing
materials etc. are valued at cost.
Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads incurred in bringing
them in their present condition. Cost of raw materials, stock in
process, stock in trade and finished goods are determined on average
cost basis.
xi) Revenue Recognition:
Revenue is recognized only when it can be definitely measured and it is
reasonable to accept final collection. Revenue from operations
includes sale of goods after adjustment of discounts (net) and return
of goods. Export benefit entitlement to the Company under Drawback,
DEPB, DFIA is recognized in the year of export on accrual basis
wherever it is ascertainable with reasonable accuracy.
Dividend income is recognized on actual receipt basis.
Interest income is recognized on time proportion basis taking into
account the amount outstanding and rate applicable.
xii) Employee Benefits:
a) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
b) Post employment Benefits
1) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trust administered by the Company, the interest rate payable to the
members of the Trust is not lower than the rate of interest declared
annually by the Central Government under the Employees' Provident Funds
and Miscellaneous Provisions Act, 1952 and shortfall if any, is made
good by the Company. The remaining provident fund contributions are
made to government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
2) Defined Benefit Plans
Liability towards gratuity, covering eligible employees, is provided
and funded on the basis of year end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees' State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
immediately in the Statement of Profit and Loss as income/expense for
the year in which they occur.
xiii) Borrowing Cost:
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized as
an expense in the period in which they are incurred. Capitalization of
borrowing costs ceases when substantially all activities necessary to
prepare the qualifying asset for its intended use or sale are complete.
xiv) Deferred Taxation:
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax rates
prevailing at the time of Balance Sheet date. Deferred Taxation so
provided is reviewed at each Balance Sheet date for necessary
adjustments.
xv) Earning per Share :
Basic earning per share is calculated by dividing the Net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average number
of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by weighted average number of equity
shares outstanding during the year after adjusting for the effects of
dilutive options.
xvi) Events occurring after Balance Sheet Date:
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
xvii) Contingent Liabilities:
Un provided contingent liabilities are disclosed in the accounts by way
of notes giving nature and quantum of such liabilities.
xviii) Research & Development Expenditure :
a) Capital Expenditure is included in Fixed Assets & Capital
Work-in-Progress and depreciation is provided at the respective
applicable rates.
b) Revenue Expenditure is charged off in the year in which they are
incurred.
xix) Cash Flow Statement:
The Company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalents consists of Cash in Hand, Cash at Bank & Cheques in Hand.
Mar 31, 2011
1 A. Basis of Accounting
The Company adopts the mercantile system of accounting and recognizes
income and expenditure on accrual basis in accordance with the
applicable accounting standards. Export incentives, insurance and other
claims, has been accounted for to the extent quantum thereof is
ascertainable with reasonable accuracy.
B. Fixed Assets
Fixed assets are stated at original cost, if revalued at revalued
amount, less depreciation. The cost of assets comprise its purchase
price, direct expenses incurred including finance costs till it is put
to use and the revalued amount, if any. The cost including additions,
improvements, renewals, revalued amount and accumulated depreciation of
assets which are sold and/or discarded, are removed from the Fixed
Assets and any profit or loss resulting there from is included in the
Profit & Loss Account.
C. Depreciation
Depreciation is provided for on written down value method, except for
Unit 1 & Unit 3 which is provided on Straight Line Method, at the rates
prescribed under Schedule XIV of the Companies Act, 1956. Depreciation
on the Assets added/disposed off during the year is being provided on
pro-rata basis.
Depreciation on revalued assets is calculated on straight line method
over the residual life of the respective assets as estimated by the
valuer. The charge for depreciation on account of revaluation is
withdrawn from capital reserve.
D. Foreign Currency Transactions, Derivatives instruments and hedge
accounting
Transactions in foreign currency other than those covered by forward
contracts are accounted for at the prevailing conversion rates on the
date of transaction and difference arising out of the settlement are
dealt with in the Profit & Loss account. Outstanding export documents
when covered by foreign exchange forward contracts are translated at
contracted rates. Foreign currency loans availed for acquisition of
fixed assets are restated at the exchange rate prevailing at year end
and exchange rate difference arising on such transactions are adjusted
in the Profit & Loss Account. Other foreign currency current assets and
liabilities outstanding at the close of the year are valued at the year
end exchange rates. The fluctuations are reflected under the
appropriate revenue head. The company uses foreign currency forward
contracts and currency options to hedge its risks associated with
foreign currency fluctuations relating to certain firm commitments and
forecasted transactions. The company designates these hedging
instruments as cash flow hedges applying the recognition and
measurement principles set out in the Accounting Standard 30 'Financial
Instruments: Recognition and Measurement' (AS-30). Hedging instruments
are initially measured at fair value, and are re-measured at subsequent
reporting dates. Changes in the fair value of these derivatives that
are designated and effective as hedges of future cash flows are
recognized directly in shareholders'funds and the effective portion is
recognized in profit & loss account. Changes in the fair value of
derivatives financial instruments that do not qualify for hedge
accounting are recognized in profit & loss account as they arise.
Hedge accounting is discontinued when the hedging instruments expires
or is sold, terminated, or exercised, or no longer qualifies for hedge
accounting. At that time for forecasted transactions, any cumulative
gain or loss on the hedging instrument recognized in Reserves & Surplus
is retained there until the forecasted transaction occurs. If a hedge
transaction is no longer expected to occur, the net cumulative gain or
loss recognized in shareholder's funds is transferred to profit & loss
account for the year.
E. Expenditure during Construction Period
Expenditure during construction period is included under Capital
Work-in-Progress and the same is allocated to the respective fixed
assets on the completion of construction /erection /installation/
production.
F. Valuation of Investments
Long-term investments are stated at cost of acquisition. Provision for
diminution in the value of long- term investments is made only if such
a decline is other than temporary in the opinion of the management.
G. Valuation of Inventories
Raw Materials and Finished Goods are valued at lower of cost or net
realisable value. Work-in-progress is valued at estimated cost.
Stores & spares parts, Dyes & chemicals, Packing materials are valued
at cost. Cost of inventories is ascertained at FIFO/Weighted average
cost.
H. Employee Benefits
i) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
ii) Post employment Benefits
a) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trusts administered by the Company, the interest rate payable to the
members of the Trusts is not lower than the rate of interest declared
annually by the Central Government under the Employees' Provident Funds
and Miscellaneous Provisions Act, 1952 and shortfall if any, is made
good by the Company. The remaining provident fund contributions are
made to employer established provident funds (other than covered
employees)/government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
b) Defined Benefit Plans
Liability towards gratuity, covering eligible employees, is provided
and funded on the basis of year end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees' State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
immediately in the Profit and Loss Account as income/expense for the
year in which they occur.
I. Miscellaneous Expenditure
Expenses related to issue of fresh capital are being amortized over a
period of 10 years.
J. Borrowing Cost
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized as
an expense in the period in which they are incurred. Capitalisation of
borrowing costs ceases when substantially all activities necessary to
prepare the qualifying asset for its intended use or sale are complete.
K. Deferred Taxation
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax rates
prevailing at the time of Balance Sheet date. Deferred Taxation so
provided is reviewed at each Balance Sheet date for necessary
adjustments.
L. Earning Per Share
Basic earning per share is calculated by dividing the net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average number
of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by the weighted average number of equity
shares outstanding during the year (adjusted for the effects of
dilutive options).
M. Events occurring after Balance Sheet Date
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
N. Contingent Liabilities
Unprovided contingent liabilities are disclosed in the accounts by way
of notes giving nature and quantum of such liabilities.
O. Research & Development Expenditure
(a) Capital Expenditure is included in Fixed Assets & Capital
Work-in-Progress and depreciation is provided at the respective
applicable rates.
(b) Revenue Expenditure is charged off in the year in which they are
incurred.
P. Cash Flow Statement
The company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalent consists of Cash in Hand, Cash at Bank & Cheques in Hand.
Mar 31, 2010
1 A. Basis of Accounting
The Company adopts the mercantile system of accounting and recognizes
income and expenditure on accrual basis in accordance with the
applicable accounting standards. Export incentives, insurance and other
claims, has been accounted for to the extent quantum thereof is
ascertainable with reasonable accuracy.
B. Fixed Assets
Fixed assets are stated at original cost, if revalued at revalued
amount, less depreciation. The cost of assets comprise its purchase
price, direct expenses incurred including finance costs till it is put
to use and the revalued amount, if any. The cost including additions,
improvements, renewals, revalued amount and accumulated depreciation of
assets which are sold and/or discarded, are removed from the Fixed
Assets and any profit or loss resulting there from is included in the
Profit & Loss Account.
C. Depreciation
Depreciation is provided for on written down value method, except for
Unit 1 & Unit 3 which is provided on Straight Line Method, at the rates
prescribed under Schedule XIV of the Companies Act, 1956. Depreciation
on the Assets added/disposed off during the year is being provided on
pro-rata basis.
Depreciation on revalued assets is calculated on straight line method
over the residual life of the respective assets as estimated by the
valuer. The charge for depreciation on account of revaluation is
withdrawn from capital reserve.
D. Foreign Currency Transactions, Derivatives instruments and hedge
accounting Transactions in foreign currency other than those covered by
forward contracts are accounted for at the prevailing conversion rates
on the date of transaction and difference arising out of the settlement
are dealt with in the Profit & Loss account. Outstanding export
documents when covered by foreign exchange forward contracts are
translated at contracted rates. Foreign currency loans availed for
acquisition of fixed assets are restated at the exchange rate
prevailing at year end and exchange rate difference arising on such
transactions are adjusted in the Profit & Loss Account. Other foreign
currency current assets and liabilities outstanding at the close of the
year are valued at the year end exchange rates. The fluctuations are
reflected under the appropriate revenue head.
The company uses foreign currency forward contracts and currency
options to hedge its risks associated with foreign currency
fluctuations relating to certain firm commitments and forecasted
transactions. The company designates these hedging instruments as cash
flow hedges applying the recognition and measurement principles set out
in the Accounting Standard 30 ÃFinancial Instruments: Recognition and
Measurement (AS-30).
Hedging instruments are initially measured at fair value, and are
re-measured at subsequent reporting dates. Changes in the fair value
of these derivatives that are designated and effective as hedges of
future cash flows are recognized directly in shareholders funds and
the effective portion is recognized in profit & loss account.
Changes in the fair value of derivatives financial instruments that do
not qualify for hedge accounting are recognized in profit & loss
account as they arise.
Hedge accounting is discontinued when the hedging instruments expires
or is sold, terminated, or exercised, or no longer qualifies for hedge
accounting. At that time for forecasted transactions, any cumulative
gain or loss on the hedging instrument recognized in Reserves & Surplus
is retained there until the forecasted transaction occurs. If a hedge
transaction is no longer expected to occur, the net cumulative gain or
loss recognized in shareholders funds is transferred to profit & loss
account for the year.
E. Expenditure during Construction Period
Expenditure during construction period is included under Capital
Work-in-Progress and the same is allocated to the respective fixed
assets on the completion of
construction/erection/installation/production.
F. Valuation of Investments
Long-term investments are stated at cost of acquisition. Provision for
diminution in the value of long-term investments is made only if such a
decline is other than temporary in the opinion of the management.
G. Valuation of Inventories
Raw Materials and Finished Goods are valued at lower of cost or net
realisable value. Work-in-progress is valued at estimated cost.
Stores & spares parts, Dyes & chemicals, Packing materials are valued
at cost. Cost of inventories is ascertained at FIFO/Weighted average
cost.
H. Employee Benefits
i) Short-term Employee Benefits
Short-term Employee Benefits (i.e. benefits payable within one year)
are recognized in the period in which employee services are rendered.
ii) Post employment Benefits
a) Defined Contribution Plans
Contributions towards provident funds are recognized as expense.
Provident fund contributions in respect of certain employees are made
to Trusts administered by the Company, the interest rate payable to the
members of the Trusts is not lower than the rate of interest declared
annually by the Central Government under the Employees Provident Funds
and Miscellaneous Provisions Act, 1952 and shortfall if any, is made
good by the Company. The remaining provident fund contributions are
made to employer established provident funds (other than covered
employees)/government administered provident fund towards which the
Company has no further obligations beyond its monthly contributions.
b) Defined Benefit Plans
Liability towards gratuity, covering eligible employees, is provided
and funded on the basis of year end actuarial valuation.
Accrued liability towards Leave encashment benefits, covering eligible
employees, evaluated on the basis of year-end actuarial valuation is
recognized as a charge.
Contribution to Central Government administered Employees State
Insurance Scheme for eligible employees are recognized as charge.
Actuarial gains/losses arising in Defined Benefit Plans are recognized
immediately in the Profit and Loss Account as income/expense for the
year in which they occur.
I. Miscellaneous Expenditure
Expenses related to issue of fresh capital are being amortized over a
period of 10 years.
J. Borrowing Cost
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of that asset. Other borrowing costs are recognized as
an expense in the period in which they are incurred. Capitalisation of
borrowing costs ceases when substantially all activities necessary to
prepare the qualifying asset for its intended use or sale are complete.
K. Deferred Taxation
Deferred Taxation is provided using the liability method in respect of
taxation effect arising from material timing difference between the
accounting and tax treatment of Income & Expenditure based on tax rates
prevailing at the time of Balance Sheet date. Deferred Taxation so
provided is reviewed at each Balance Sheet date for necessary
adjustments.
L. Earning Per Share
Basic earning per share is calculated by dividing the net Profit for
the year attributable to equity shareholders (after deducting the
dividend on redeemable preference share) by the weighted average number
of equity shares outstanding during the year.
Diluted earning per share is calculated by dividing the net profit
attributable to equity shareholders (after deducting the dividend on
redeemable preference share) by the weighted average number of equity
shares outstanding during the year (adjusted for the effects of
dilutive options).
M. Events occurring after Balance Sheet Date
Events occurring after the balance sheet date have been considered in
the preparation of financial statements.
N. Contingent Liabilities
Unprovided contingent liabilities are disclosed in the accounts by way
of notes giving nature and quantum of such liabilities.
O. Cash Flow Statement
The company adopts the Indirect Method in preparation of Cash Flow
Statement. For the purpose of Cash Flow Statement Cash & Cash
equivalent consists of Cash in Hand, Cash at Bank & Cheques in Hand.