Accounting Policies of Indus Fila Ltd. Company

Mar 31, 2015

The financial statements have been prepared under the historical cost convention in accordance with the accounting principles generally accepted in India and comply with the mandatory Accounting Standards notified by the Central Government of India under The Companies (Accounting Standards) Rules, 2006 and with the provisions of the Companies Act, 2013.

The Company's operating results continue to be materially affected by various factors and the company has continuously implemented various measures to mitigate those factors to improve the operating results and cash flows. In addition, the company continues to explore various options to raise finance in order to meet its short term and long term obligations. The Company believes that operations will be improved considering the measures taken. Accordingly the financial statements have been prepared on going concern basis whereby the realization of assets and discharge of liabilities are expected to occur in the normal course of business.

1. use of estimates

The preparation of the financial statements is in conformity with GAAP requires Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, post-sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively.

2. fixed assets and depreciation

a. Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing asset to its working condition for its intended use (including therein proportionate expenditure during construction period). Financing costs relating to acquisition of fixed assets are also included to the extent they relate to the period till such assets are ready to put to use.

b. Depreciation is provided on Straight Line basis as per Schedule II to the Companies Act, 2013.

c. In respect of buildings on lease hold land, cost is amortized as depreciation over the period of lease.

3. inventories

Inventories are valued at lower of cost or net realizable value. Cost includes all cost of purchase, applicable duties and taxes, cost of conversion and other costs incurred in bringing the inventories to their present location and condition and in the case Finished Goods and Work-in-progress includes appropriate allocated/apportioned production overheads.

4. foreign currency transaction

Monetary assets and liabilities are restated at the date of Balance Sheet. The resultant difference is charged / credited to Profit and Loss Account except in respect of liabilities related to fixed assets which is adjusted to the fixed assets. In respect of Foreign Currency Forward / Derivative contracts entered for hedge the outstanding contracts are evaluated with the foreseeable future transaction and in event of the material shortfall in the estimate of future transaction corresponding forward adjustment is made for the forward / derivative contracts, at the Balance Sheet date. However exchange Loss / Gain on the date of maturity of forward / derivative are adjusted in the profit and loss account of the period.

5. revenue recognition

a. Revenue in respect of sales is recognized on transfer of significant risks and rewards of ownership which is generally at the point of despatch of materials to customers.

b. Other revenues including drawback claims etc., are recognized with due consideration for significant uncertainty if any in realization of such dues.

6. retirement benefits

a. Defined Contribution Plan :-

In respect of provident fund benefits the company makes the stipulated contribution in respect of the employees to the regional provident fund authority under which the company's liability is limited to the extent of the contribution.

b. Defined Benefit Plan :-

The liability for defined benefit plan of the gratuity is determined on the basis of actuarial valuation at the end of the year using projected unit credit method. However, the liability has not been funded. Actuarial gain & loss which comprises experience adjustments & effect of change in actuarial assumption are recognized in the Profit & Loss Account.

7. investments

Long term investments are stated at cost (net of provisions), if any, for diminution in value which is not temporary. Current investments are stated at lower of cost or fair value determined with reference to its market value reliability in consonance with the nature of underlying asset.

8. borrowing costs

Interest and other borrowing costs are charged to the profit and loss account except in cases where the borrowing is directly attributable to the acquisition, construction or production of an asset or group of assets, which take(s) substantial period of time to get ready for intended use. All other interest and other borrowing costs are recognised as expenses in the period in which they are incurred.

9. taxes on income

Income taxes are accounted in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Tax expense comprises of both current and deferred tax.

Current Tax

Current tax is determined as the amount of tax payable in respect of taxable income for the period using the applicable tax rates and tax laws.

Deferred Tax

Deferred Tax Assets and Liabilities are recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income, that originate in one period and are capable of reversal in one or more subsequent periods and are measured using the tax rates enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for their appropriateness of their respective caring value at each balance sheet date.

10. impairment of asset

The Company assesses the impairment of assets with reference to each Cash Generating Unit (CGU) at each Balance Sheet date if events or changes in circumstances, based on internal and external factors, indicate that the carrying value may not be recoverable in full. The loss on account of impairment, which is the difference between the carrying amount and recoverable amount, is accounted accordingly. Recoverable amount of a CGU is its net Selling price or value in use whichever is higher. The value in use is arrived at on the basis of estimated future cash flows discounted at company's pre-tax borrowing rates.

11 . provisions & contingencies:

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions are not discounted to present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet

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Jun 30, 2013

A. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The company follows Accrual System of Accounting on a going concern concept on historical cost convention method as per applicable mandatory accounting standards.

1. USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, post-sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates.

2. FIXED ASSETS AND DEPRECIATION

a. Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing asset to its working condition for its intended use (including therein proportionate expenditure during construction period).

b. Depreciation is provided on Straight Line basis as per Schedule XIV to the Companies Act, 1956 at the rates specified therein and in respect of buildings on lease hold land, cost is amortized as depreciation over the period of lease.

3. INVENTORIES

Inventories are valued at lower of cost or net realizable value. Cost includes all cost of purchase, applicable duties and taxes, cost of conversion and other costs incurred in bringing the inventories to their present location and condition and in the case Finished Goods and Work-in-progress includes appropriate allocated/apportioned production overheads.

4. FOREIGN CURRENCY TRANSACTION

Monetary assets and liabilities are restated at the date of Balance Sheet. The resultant difference is charged / credited to Profit and Loss Account except in respect of liabilities related to fixed assets which is adjusted to the fixed assets. In respect of Foreign Currency Forward / Derivative contracts entered for hedge the outstanding contracts are evaluated with the foreseeable future transaction and in event of the material shortfall in the estimate of future transaction corresponding forward adjustment is made for the forward / derivative contracts, at the Balance Sheet date. However exchange Loss / Gain on the date of maturity of forward / derivative are adjusted in the profit and loss account of the period.

5. REVENUE RECOGNITION

a. Revenue in respect of sales is recognized on transfer of significant risks and rewards of ownership which is generally at the point of dispatch of materials to customers.

b. Other revenues including drawback claims etc., are recognized with due consideration for significant uncertainty if any in realization of such dues.

6. RETIREMENT BENEFITS

a. Defined Contribution Plan :-

In respect of provident fund benefits the company makes the stipulated contribution in respect of the employees to the regional provident fund authority under which the company''s liability is limited to the extent of the contribution.

b. Defined Benefit Plan :-

The liability for defined benefit plan of the gratuity is determined on the basis of actuarial valuation at the end of the period using projected unit credit method. However, the liability has not been funded. Actuarial gain & loss which comprises experience adjustments & effect of change in actuarial assumption are recognized in the Profit & Loss Account.

7. INVESTMENTS

Long term investments are stated at cost (net of provisions), if any, for diminution in value which is not temporary. Current investments are stated at lower of cost or fair value determined with reference to its market value realisability in consonance with the nature of underlying asset.

8. BORROWING COSTS

Interest and other borrowing costs are charged to the profit and loss account except in cases where the borrowing is directly attributable to the acquisition, construction or production of an asset or group of assets, which take(s) substantial period of time to get ready for intended use. All other interest and other borrowing costs are recognised as expenses in the period in which they are incurred.

9. TAXES ON INCOME

Income taxes are accounted in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Tax expense comprises of both current and deferred tax.

Current Tax

Current tax is determined as the amount of tax payable in respect of taxable income for the period using the applicable tax rates and tax laws.

Deferred Tax

Deferred Tax Assets and Liabilities are recognis ed, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income, that originate in one period and are capable of reversal in one or more subsequent periods and are measured using the tax rates enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for their appropriateness of their respective caring value at each balance sheet date.

10. IMPAIRMENT OF ASSET

The Company assesses the impairment of assets with reference to each Cash Generating Unit (CGU) at each Balance Sheet date if events or changes in circumstances, based on internal and external factors, indicate that the carrying value may not be recoverable in full. The loss on account of impairment, which is the difference between the carrying amount and recoverable amount, is accounted accordingly. Recoverable amount of a CGU is its net Selling price or value in use whichever is higher. The value in use is arrived at on the basis of estimated future cash flows discounted at company''s pre-tax borrowing rates.

11. PROVISIONS & CONTINGENCIES:

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions are not discounted to present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet

Nature of Security

The above Term loan from Banks are secured by

a) Ftrst part-passu charge on all the fixed assets, present and future of the company.

b) Pari-passu second charge on all the current assets, present and future of the company.

Terms of Repayment of above Term loan from banks

a) Out of the total term loans, Rs 12.67 crores (as on 31.03.2012 Rs.15.38 crores) Is repayable In 28 Quarterly Installments commencing from June 2012. Last Installment due In March 2019. Rate of Interest ® 11.7596 p.a. as period ended(previous year 12 % p.a.)

b)Out of the total term loans,Rs 40.55 crores (as on 31.03.2012 Rs.48.12 crores) Is repayable in 36 Quarterly Installments commencing from June 2010. Last Installment due In March 2019. Rate of interest S 11.75% p.a. as period ended (previous year 12 X p.a.)

c)Out of the total term loans, Rs 20,71 crores (as on 31.03.2012 Rs.24.89 crores) is repayable in 32 Quarterly installments commencing from June 2011. Last Installment due in March 2019. Rate of interest 6 11.75% p.a. as period ended (previous year 12% p.a.)

d)Out of the total term loans, Rs 5.32 crores (as on 31.03.2012 Rs.6.43 crores) is repayable in 40 Quarterly installments commencing from June 2009. Last installment due in March 2019. Rate of interest ® 11.75% p.a. as period ended (previous year 12 % p.a.)

e) Continuing default- Rs 276222991 from the year 2010-11.

e) The Company is not in the possession of details required for the purpose of classification of creditors as per Micro, Small and Medium Enterprises Development Act, 2006. Hence the company is unable to furnish the information required under the said Act or under Schedule VI of the Companies Act, 1956.

f) Balances in certain party''s accounts are subject to reconciliation and consequent adjustments thereof. In the opinion of the management the impact of such adjustments, if any, on the financial results would be not material.

g) The company operates in one segment, viz., Textiles.

h) Taxation

a. Deferred Tax Asset on the current year losses of the company has been accounted on the basis of business plan and projection furnished by the company to the bankers based on which the debt restructuring has been sanctioned. There is a variation in the amount projected and the actuals. In the opinion of the management the variance would be offset by the earnings in future periods.

i) Bank Balances

Consequent to listing of the company in stock exchange the company has communicated to the bankers for making necessary change in the name of the company in their records however some of the bankers have not given effect to the change and continuing in the erstwhile name.

j) Turnover of the company is net of sales returns and trade discounts

k) Other Operating revenue represents the export incentives receivable from the government authorities.

I) During the period the company has made a provision for bad & doubtful debts towards one of debtor amounting to Rs. 22,20,65,212/-.

I) Previous year figures have been regrouped / reclassified wherever necessary.

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Mar 31, 2012

The financial statements have been prepared under the historical cost convention in accordance with the accounting principles generally accepted in India and comply with the mandatory Accounting Standards notified by the Central Government of India under The Companies (Accounting Standards) Rules, 2006 and with the provisions of the Companies Act, 1956.

1. USE OF ESTIMATES

The preparation of the financial statements is in conformity with GAAP requires Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, post-sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively.

2. FIXED ASSETS AND DEPRECIATION

a. Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing asset to its working condition for its intended use (including therein proportionate expenditure during construction period). Financing costs relating to acquisition of fixed assets are also included to the extent they relate to the period till such assets are ready to put to use.

b. Depreciation is provided on Straight Line basis as per Schedule XIV to the Companies Act,1956 at the rates specified therein and in respect of buildings on lease hold land, cost is amortized as depreciation over the period of lease.

3. INVENTORIES

Inventories are valued at lower of cost or net realizable value. Cost includes all cost of purchase, applicable duties and taxes, cost of conversion and other costs incurred in bringing the inventories to their present location and condition and in the case Finished Goods and Work-in-progress includes appropriate allocated/apportioned production overheads.

4. FOREIGN CURRENCY TRANSACTION

Monetary assets and liabilities are restated at the date of Balance Sheet. The resultant difference is charged / credited to Profit and Loss Account except in respect of liabilities related to fixed assets which is adjusted to the fixed assets. In respect of Foreign Currency Forward / Derivative contracts entered for hedge the outstanding contracts are evaluated with the foreseeable future transaction and in event of the material shortfall in the estimate of future transaction corresponding forward adjustment is made for the forward / derivative contracts, at the Balance Sheet date. However exchange Loss / Gain on the date of maturity of forward / derivative are adjusted in the profit and loss account of the period.

5. REVENUE RECOGNITION

a. Revenue in respect of sales is recognized on transfer of significant risks and rewards of ownership which is generally at the point of despatch of materials to customers.

b. Other revenues including drawback claims etc., are recognized with due consideration for significant uncertainty if any in realization of such dues.

6. RETIREMENT BENEFITS

a. Defined Contribution Plan :-

In respect of provident fund benefits the company makes the stipulated contribution in respect of the employees to the regional provident fund authority under which the company's liability is limited to the extent of the contribution.

b. Defined Benefit Plan

The liability for defined benefit plan of the gratuity is determined on the basis of actuarial valuation at the end of the year using projected unit credit method. However, the liability has not been funded. Actuarial gain & loss which comprises experience adjustments & effect of change in actuarial assumption are recognized in the Profit & Loss Account.

7. INVESTMENTS

Long term investments are stated at cost (net of provisions), if any, for diminution in value which is not temporary. Current investments are stated at lower of cost or fair value determined with reference to its market value realisability in consonance with the nature of underlying asset.

8. BORROWING COSTS

Interest and other borrowing costs are charged to the profit and loss account except in cases where the borrowing is directly attributable to the acquisition, construction or production of an asset or group of assets, which take(s) substantial period of time to get ready for intended use. All other interest and other borrowing costs are recognized as expenses in the period in which they are incurred.

9. TAXES ON INCOME

Income taxes are accounted in accordance with Accounting Standard 22 on Accounting for Taxes on Income. Tax expense comprises of both current and deferred tax.

Current Tax

Current tax is determined as the amount of tax payable in respect of taxable income for the period using the applicable tax rates and tax laws.

Deferred Tax

Deferred Tax Assets and Liabilities are recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income, that originate in one period and are capable of reversal in one or more subsequent periods and are measured using the tax rates enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for their appropriateness of their respective caring value at each balance sheet date.

10. IMPAIRMENT OF ASSET

The Company assesses the impairment of assets with reference to each Cash Generating Unit (CGU) at each Balance Sheet date if events or changes in circumstances, based on internal and external factors, indicate that the carrying value may not be recoverable in full. The loss on account of impairment, which is the difference between the carrying amount and recoverable amount, is accounted accordingly. Recoverable amount of a CGU is its net Selling price or value in use whichever is higher. The value in use is arrived at on the basis of estimated future cash flows discounted at company's pre-tax borrowing rates.

11. PROVISIONS & CONTINGENCIES:

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions are not discounted to present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet.

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Mar 31, 2010

The company follows Accrual System of Accounting on a going concern concept on historical cost convention method as per applicable mandatory accounting standards.

1. USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, post-sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively.

2. FIXED ASSETS AND DEPRECIATION

a. Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing asset to its working condition for its intended use ( including therein proportionate expenditure during construction period).

b. Depreciation is provided on Straight Line basis as per Schedule XIV to the Companies Act,1956 at the rates specified therein and in respect of buildings on lease hold land, cost is amortized as depreciation over the period of lease.

3 .INVENTORIES

Inventories are valued at lower of cost or net realizable value. Cost includes applicable duties and taxes and in the case Finished Goods and Work-in-progress includes appropriate allocated/apportioned production overheads.

4. FOREIGN CURRENCY TRANSACTION

Monetary assets and liabilities are restated at the date of Balance Sheet. The resultant difference is charged / credited to Profit and Loss Account except in respect of liabilities related to fixed assets which is adjusted to the fixed assets. In respect of Foreign Currency Forward / Derivative contracts entered for hedge the outstanding contracts are evaluated with the foreseeable future transaction and in event of the material shortfall in the estimate of future transaction corresponding forward adjustment is made for the forward / derivative contracts, at the Balance Sheet date. However exchange Loss / Gain on the date of maturity of forward / derivative are adjusted in the profit and loss account of the period.

5. REVENUE RECOGNITION

a. Revenue in respect of sales is recognized at the point of despatch of materials to customers.

b. Other revenues including drawback claims etc., are recognized with due consideration for significant uncertainty if any in realization of such dues.

6. RETIREMENT BENEFITS

a. Defined Contribution Plan :- In respect of provident fund benefits the company makes the stipulated contribution in respect of the employees to the regional providentfund authority under which the companys liability is limited to the extent of the contribution.

b. Defined Benefit Plan :- The liability for defined benefit plan of the gratuity is determined on the basis of actuarial valuation at the end of the year using projected unit credit method . However , the liability has not been funded.

Actuarial gain & loss which comprises experience adjustments & effect of change in actuarial assumption are recognized in the Profit & Loss Account.

7. INVESTMENTS

Long term investments are stated at cost (net of provisions), if any, for diminution in value which is not temporary. Current investments are stated at lower of cost or fair value determined with reference to its market value realisability in consonance with the nature of underlying asset.

8. BORROWING COSTS

Borrowing Costs are charged to the profit and loss account except in cases where the borrowing is directly attributable to the acquisition, construction or production of an asset or group of assets, which take(s) substantial period of time to get ready for intended use.

9. TAXES ON INCOME

a. Taxes on income for the current year are determined on the basis of taxable income and after considering the various deductions available under the Income-tax Act, 1961

b. Deferred Tax Liability/asset resulting from timing differences between book profits and income for tax purposes is accounted for at the appropriate rate of tax. Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for their appropriateness of their respective carrying value at each Balance Sheet date

10. IMPAIRMENT OF ASSET

The Company assesses the impairment of assets with reference to each Cash Generating Unit (CGU) at each Balance Sheet date if eventsor changes in circumstances, based on internal and external factors, indicate that the carrying value may not be recoverable in full. The loss on account of impairment, which is the difference between the carrying amount and recoverable amount, is accounted accordingly. Recoverable amount of a CGU is its net Selling price or value in use whichever is higher. The value in use is arrived at on the basis of estimated future cashflows discounted at companys pre-tax borrowing rates.

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Mar 31, 2009

A. GENERAL

The Company has filed petition bearing No. 97 / 2009, in the Honble High Court of Karnataka for the merger of Tulip Apparels Pvt Ltd (the transferor company) to achieve optimum utilization of manpower, infrastructure, production and logistic facilities. The proposed merger is subject to sanction by the High Court. The effective date as per the scheme of amalgamation approved by the Board is 31.03.2008. The salient features of the scheme of merger filed in the High Court are:

1. The Shareholders of the transferor company would be allotted 3 equity shares of the face value of Rs. 10/- each for every 122 equity shares held in that company. Consequently, 12,291 equity shares of Rs. 10/- each would be issued.

2. Carry Forward Losses and Deferred Asset of the transferor company as at 31.03.2008 are Rs.2993.91 Lakhs and Rs.1485.16 Lakhs respectively. The audited financial results of the transferor company for the year 2008-09 are not available and hence the profit / (loss) for this period are not ascertainable.

3. The accounts are prepared on stand alone basis pending successful completion of process of merger.

B. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The company follows Accrual System of Accounting on a going concern concept on historical cost convention method as per applicable mandatory accounting standards.

1. USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, post-sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates.

2. FIXED ASSETS AND DEPRECIATION

a. Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable cost of bringing asset to its working condition for its intended use (including therein proportionate expenditure during construction period).

b. Depreciation is provided on Straight Line basis as per Schedule XIV to the Companies Act,1956 at the rates specified therein and in respect of buildings on lease hold land, cost is amortized as depreciation over the period of lease.

3. INVENTORIES

Inventories are valued at lower of cost or net realizable value. Cost includes applicable duties and taxes and in the case Finished Goods and Work-in-progress includes appropriate allocated/apportioned production overheads

4 FOREIGN CURRENCY TRANSACTION

Monetary assets and liabilities are restated at the date of Balance Sheet. The resultant difference is charged / credited to Profit • and Loss Account except in respect of liabilities related to fixed assets which is adjusted to the fixed assets. In respect of Foreign Currency Forward / Derivative contracts entered for hedge the outstanding contracts are evaluated with the foreseeable future transaction and in event of the material shortfall in the estimate of future transaction corresponding forward adjustment is made for the forward / derivative contracts, at the Balance Sheet date. However exchange Loss / Gain on the date of maturity of forward / derivative are adjusted in the profit and loss account of the period.

a. Revenue in respect of sales is recognized at the point of despatch of materials to customers.

b. Other revenues including drawback claims etc., are recognized with due consideration for significant uncertainty if any in realization of such dues.

a. Defined Contribution Plan :-

In respect of provident fund benefits the company makes the stipulated contribution in respect of the employees to the regional provident fund authority under which the companys liability is limited to the extent of the contribution.

b. Defined Benefit Plan :-

The liability for defined benefit plan of the gratuity is determined on the basis of actuarial valuation at the end of the year using projected unit credit method . However ,the liability has not been funded. Actuarial gain & loss which comprises experience adjustments & effect of change in actuarial assumption are recognized in the Profit & Loss Account.

7. lNVESTMENTS

Long term investments are stated at cost (net of provisions), if any, for diminution in value which is not temporary. Current investments are stated at lower of cost or fair value determined with reference to its market value realisability in consonance with the nature of underlying asset.

8. BORROWING COSTS

Borrowing Costs are charged to the profit and loss account except in cases where the borrowing is directly attributable to the acquisition, construction or production of an asset or group of assets, which take(s) substantial period of time to get ready for intended use.

9. TAXES ON INCOME

a. Taxes on income for the current year are determined on the basis of taxable income and after considering the various deductions available under the Income-tax Act, 1961.

b. Deferred Tax Liability/asset resulting from timing differences between book profits and income for tax purposes is accounted for at the appropriate rate of tax. Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for their appropriateness of their respective carrying value at each Balance Sheet date.

10. IMPAIRMENT OF ASSET

The Company assesses the impairment of assets with reference to each Cash Generating Unit (CGU) at each Balance Sheet date if events or changes in circumstances, based on internal and external factors, indicate that the carrying value may not be recoverable in full. The loss on account of impairment, which is the difference between the carrying amount and recoverable amount, is accounted accordingly. Recoverable amount of a CGU is its net Selling price or value in use whichever is higher. The value in use is arrived at on the basis of estimated future cash flows discounted at companys pre- tax borrowing rates.