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Accounting Policies of Ess Dee Aluminium Ltd. Company

Mar 31, 2016

Notes to financial statements for the year ended 31st March 2016 Note 29. Other Disclosures

29.01 : Significant accounting policies

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with accounting standards specified in Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rule, 2014. The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements. The difference between actual results and estimates are recognized in the period in which the results are known.

2. Revenue Recognition:

Revenue is recognized on transfer of all significant risks and rewards of ownership to the buyer. Domestic sales are accounted on dispatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation on assets has been provided based on useful lives prescribed in Schedule II of the Companies Act, 2013 on straight line basis. However, in respect of the following asset categories, the depreciation is provided based on useful lives being different than as prescribed in Schedule II-

Notes to financial statements for the year ended 31st March 2016

The company has carried out assessment of useful lives of these assets and based on technical justification, different useful lives have been arrived at in respect to above assets. The justification for adopting different useful life compared to the useful life of assets provided in Schedule II is based on the business specific environment & usage, consumption pattern of the assets, past performance of similar assets and peer industry comparison duly supported by technical assessment by a Chartered Engineer.

Leasehold land is amortized over the period of lease. Software is amortized over a period of five years. Depreciation for additions to/deletions from fixed assets is calculated on pro rata basis.

4. Inventories:

Inventories are valued at the lower of cost or net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on Weighted Average method.

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year’s accrued liability on account of leave encashment benefit (only for employees of erstwhile India Foils Ltd (IFL)) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. Gratuity is considered accrued and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect to certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees’ Provident Fund Commissioner, under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Year’s accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31 st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year’s accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company’s policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they

Notes to financial statements for the year ended 31st March 2016

are incurred.

9. Financial Derivatives Hedging Transactions

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the Profit and Loss account.

10. Provision, Contingent Liabilities and Contingent Assets

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.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal \ external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss is further provided or reversed depending on changes in circumstances.

12. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.

Under the provisions of section 132 of Income Tax Act, 1961, Income Tax Authorities had carried out search and seizure proceedings at the premises of the Company on 28th March, 2014. Company had challenged the validity of search carried out at its business premises on conversion of survey U/s 133A before Hon’ble Bombay High Court on the plea that the said action was contrary to the provisions of section 132(1) of the Act. While dismissing the petition being withdrawn vide its order dated 20th April 2016, the Hon’ble Bombay High Court has granted liberty to raise all contentions, including those raised in these petitions in this challenge to the assessment orders dated 29th March, 2016 passed under Section 153A of the Income Tax Act, 1961 before the appellate authorities under the Act. The company has later objected before the Hon’ble High Court for treating the appeal as withdrawn however the same has not been entertained. Accordingly, the Company has on 11th May, 2016 filed a Special Leave Petition before Supreme Court against the said order. In the opinion of the Company the assessment order U/s 143(3) r.w.s. 153A of the Act does not have validity on the very basis of assuming jurisdiction U/s 153Aof the Act.


Mar 31, 2015

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular no. 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs). The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements. The difference between actual results and estimates are recognized in the period in which the results are known.

2. Revenue Recognition:

Revenue is recognized on transfer of all significant risks and rewards of ownership to the buyer. Domestic sales are accounted on dispatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

The company has carried out assessment of useful lives of these assets and based on technical justification, different useful lives have been arrived at in respect of above assets. The justification for adopting different useful life compared to the useful life of assets provided in Schedule II is based on the business specific environment & usage, consumption pattern of the assets, past performance of similar assets and peer industry comparison duly supported by technical assessment by a Chartered Engineer.

Leasehold land is amortized over the period of lease. Software is amortised over a period of five years.

Depreciation for additions to/deletions from fixed assets is calculated on pro rata basis.

4. Inventories:

Inventories are valued at the lower of cost or net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on Weighted Average method .

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year''s accrued liability on account of leave encashment benefit (only for employees of erstwhile India Foils Ltd (IFL)) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. Gratuity is considered accrued and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect of certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees'' Provident Fund Commissioner, under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Year''s accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year''s accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company''s policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Financial Derivatives Hedging Transactions.

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the Profit and Loss account.

10. Provision, Contingent Liabilities and Contingent Assets

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.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

12. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.


Mar 31, 2014

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular no. 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs). The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements. The difference between actual results and estimates are recognized in the period in which the results are known.

2. Revenue Recognition:

a. Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

b. Domestic sales are accounted on despatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Sales are disclosed net of sales tax, discounts and returns, as applicable.

c. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation is provided on the straight line method at the rates and in manner laid down in Schedule XIV to the Companies Act, 1956. Leasehold Land is amortized over the period of lease. Software is amortised over five years on straight line basis

4. Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on Weighted Average method .

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year''s accrued liability on account of leave encashment benefit (only for employees of erstwhile India Foils Ltd (IFL)) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. Gratuity is considered accrued and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect of certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees'' Provident Fund Commissioner, under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Year''s accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year''s accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company''s policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Financial Derivatives Hedging Transactions.

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the Profit and Loss account.

10. Provision, Contingent Liabilities and Contingent Assets

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.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

12. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.


Mar 31, 2013

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, relevant provisions ofthe CompaniesAct 1956 and statements issued by the Institute of Chartered Accountants of India. The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements.

2. Revenue Recognition:

a. Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

b. Domestic sales are accounted on despatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Sales are disclosed net of sales tax, discounts and returns, as applicable.

c. Export incentives/interest income and income on investments are accounted on accrual basis.

3. FixedAssets, Capital Work-in-Progress and Depreciation:

a. FixedAssets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation is provided on the straight line method at the rates and in manner laid down in Schedule XIV to the CompaniesAct, 1956. Leasehold Land is amortized over the period of lease. Software is amortised over five years on straight line basis

4. Inventories:

Inventories are valued atthe lower of costand net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on First In First Out method.

5. Taxation:

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign ExchangeTransactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Statement Profit and Loss.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year''s accrued liability on account of Leave encashment benefit (only for employees of erstwhile India Foils Ltd (IFL)) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. Gratuity is considered accrued and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards providentfunds are recognized as expense.

Year''s accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year''s accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company''s policy and charged as expense for the year.

8. Borrowing Cost:

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use.All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Financial Derivatives Hedging Transactions:

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the Statement of Profit and Loss.

10. Provision, Contingent Liabilities and ContingentAssets:

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. ContingentAssets are neither recognized nor disclosed in the financial statements.

11. Impairment of Assets:

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal / external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

12. Earnings Per Share:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases:

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.


Mar 31, 2012

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, relevant provisions of the Companies Act 1956 and statements issued by the Institute of Chartered Accountants of India. The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements.

2. Revenue Recognition:

a. Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

b. Domestic sales are accounted on despatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Sales are disclosed net of sales tax, discounts and returns, as applicable.

c. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation is provided on the straight line method at the rates and in manner laid down in Schedule XIV to the Companies Act, 1956. Leasehold Land is amortized over the period of lease. Software is amortised over five years on straight line basis

4. Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on First In First Out method.

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year's accrued liability on account of Leave encashment benefit (only for employees of erstwhile India Foils Ltd (IFL) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. Gratuity is considered accrued and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect of certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees' Provident Fund Commissioner, under Employees' Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Year's accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year's accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company's policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Financial Derivatives Hedging Transactions.

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the Profit and Loss account.

10. Provision, Contingent Liabilities and Contingent Assets

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.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

12. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.


Mar 31, 2011

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, relevant provisions of the Companies Act 1956 and statements issued by the Institute of Chartered Accountants of India. The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements.

2. Revenue Recognition:

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

a. Domestic sales are accounted on despatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Sales are disclosed net of sales tax, discounts and returns, as applicable.

b. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation is provided on the straight line method at the rates and in manner laid down in Schedule XIV to the Companies Act, 1956. Leasehold Land is amortized over the period of lease. Software is amortised over five years on straight line basis

4. Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on First In First Out method.

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Year's accrued liability on account of Gratuity and Leave encashment benefit [only for employees of erstwhile India Foils Limited (IFL)] payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. For other employees Gratuity is considered actuarial and accounted for as per actuarial valuation done by SBI Life Insurance Company Ltd. Under the Group Gratuity scheme and leave encashment is accounted for as per actuarial valuation done by an actuary.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect of certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees' Provident Fund Commissioner, under Employees' Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Year's accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Year's accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Company's policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Financials Derivatives Hedging Transactions.

In respect of derivatives contracts, premium paid and gains / losses on settlement are recognized in the profit and Loss account.

10. Provision, Contingent Liabilities and Contingent Assets

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.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

12. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

13. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.


Mar 31, 2010

1. System of Accounting:

The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis. Financial Statements are prepared under historical cost convention, in accordance with the Generally Accepted Accounting Principles in India (GAAP) and comply in all material aspects, with mandatory accounting standards as notified by the Companies (Accounting Standard) Rules 2006, relevant provisions of the Companies Act 1956 and statements issued by the Institute of Chartered Accountants of India. The significant accounting policies followed by the Company are set out below. Management has made certain estimates and assumptions in conformity with the GAAP in the preparation of these financial statements, which are reflected in the preparation of these financial statements.

2. Revenue Recognition:

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

a. Domestic sales are accounted on dispatch of products to customers and export sales are accounted on the basis of dates of bill of lading. Sales are disclosed net of sales tax, discounts and returns , as applicable.

b. Export incentives / interest income and income on investments are accounted on accrual basis.

3. Fixed Assets, Capital Work-in-Progress and Depreciation:

a. Fixed Assets:

Fixed assets are stated at cost of acquisition or construction less depreciation. Cost comprises the purchase price and other attributable costs, including interest and finance costs incurred till the asset is commissioned.

b. Capital Work-in-Progress:

Capital work-in-progress includes the cost of fixed assets that are not ready for their intended use and is stated upto the amount expended till the date of balance sheet.

c. Depreciation:

Depreciation is provided on the straight line method at the rates and in manner laid down in Schedule XIV to the Companies Act, 1956. Leasehold Land is amortized over the period of lease.

4. Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost of inventories comprise all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on First In First Out method.

5. Taxation

Income tax comprises current tax and deferred tax charge or release. The deferred tax charge or credit is recognized using current tax rates. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed as at each Balance Sheet date to reassess realization.

6. Foreign Exchange Transactions:

Transactions in foreign currency are recorded at exchange rates prevailing on the dates of respective transactions. The difference in translation and realized gains and losses on foreign exchange transactions are recognized in the Profit and Loss Account.

7. Employee Benefits:

Short-term employee benefits (i.e. benefits payable within one year) are recognized in the period in which the employee service is rendered.

Years accrued liability on account of gratuity and leave encashment benefit (only for employees of erstwhile India Foils Ltd) payable to employees under defined benefit plan is ascertained on the basis of actuarial valuation made on the Balance Sheet date and provided in the accounts. For the employees of Essdee Aluminium Ltd, as per Company rules leave is not entitled to be carried forward. Accordingly, leave encashment is recognized on full liability basis.

Contributions towards provident funds are recognized as expense.

Contribution to Provident Fund in respect of certain employees of erstwhile IFL is made to the Trusts administered by the Company, and in respect of other employees is made to the office of the Employees Provident Fund Commissioner, under Employees Provident Funds and Miscellaneous Provisions Act, 1952. The interest rate payable to the members of the Trusts administered by the Company is not lower than the rate of interest declared annually by the Central Government under Employees Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is made good by the Company.

Years accrued liability on account of Pension Scheme for certain employees of erstwhile IFL under defined benefit plan upto 31st December, 2000 is ascertained and provided for on the basis of actuarial valuation made on the Balance Sheet date. The said Pension Scheme was amended from defined benefit plan to defined contribution plan effective 1st January 2001 and the benefits under the defined benefit plan were frozen as on 31st December 2000. Years accrued liability in respect of the aforesaid defined contribution plan is ascertained as per the Companys policy and charged as expense for the year.

8. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of a qualifying assets are capitalized as part of cost of such assets till such time as the assets is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenses in the period in which they are incurred.

9. Provision, Contingent Liabilities and Contingent Assets

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.

10. Impairment of Assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal external factors. An impairment loss will be recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss if further provided or reversed depending on changes in circumstances.

11. Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share holder by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity share holders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

12. Leases

Operating lease payments are recognized as expenses on a straight line basis over the term of lease.

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