Home  »  Company  »  JK Cement  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of JK Cement Ltd. Company

Mar 31, 2017

I. SIGNIFICANT ACCOUNTING POLICIES

I Reporting Entity

J K Cement Limited (“J K Cement Limited” or “the Company”) is a public limited company domiciled in India and has its registered office at Kamla Tower, Kanpur, Uttar Pradesh - 208 001. J K Cement Limited’s equity shares are listed on National Stock Exchange and Bombay Stock Exchange in India.

II Significant Accounting Policies

The Company has consistently applied the following accounting policies to all periods presented in the financial statements.

1. Basis of preparation

These financial statements have been prepared in accordance with the recognition and measurement principles laid down in Indian Accounting Standard (‘Ind AS’) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (‘the Act’) and other relevant provisions of the Act.

The financial statement up to year ended 31 March, 2016 were prepared in accordance with Generally Accepted Accounting Principles (GAAP) in India and complied with the applicable accounting standards prescribed in the Companies (Accounting Standards) Rules, 2014 issued by the Central Government and as per relevant provisions of the Companies Act, 2013 read together with Paragraph 7 of The Companies (Accounts) Rules, 2014.

The financial statements for the year ended 31 March, 2017 are the first financial statements of the Company prepared under Ind AS. An explanation of how the transition to Ind AS has affected the reported financial position, financial performance and cash flows of the Company is provided in note 42.

These financial statements were authorized for issue by the Board of Directors on 13.05.2017.

2. Basis of measurement

The financial statements have been prepared on a historical cost basis except the following items, which are measured on alternative basis on each reporting date:

- Certain financial assets and liabilities that is measured at fair value (Refer Note 41)

- Defined benefit liability/(assets): fair value of plan assets less present value of defined benefit obligation(Refer Note 38)

3. Functional and presentation currency

These financial statements are presented in Indian National Rupee (‘INR’), which is the Company’s functional currency. All amounts have been rounded to the nearest lacs unless otherwise indicated.

4. Use of judgments and estimates

In preparing these financial statements, management has made judgments, estimates and assumptions that affect the application of the company’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized prospectively.

A. Judgments

Information about the judgments made in applying accounting policies that have the most significant effects on the amounts recognized in the financial statements have been given below:

- Classification of leases into finance and operating lease

- Classification of financial assets: assessment of business model within which the assets are held and assessment of whether the contractual terms of the financial asset are solely payments of principal and interest on the principal amount outstanding.

B. Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the financial statements for the year ended 31 March 2017 is included below:

- Measurement of defined benefit obligations: key actuarial assumptions

- Recognition of deferred tax assets: availability of future taxable profit against which carry-forward tax losses can be used;

- Impairment test: key assumptions underlying recoverable amounts, including the recoverability of development costs;

- Useful life and residual value of fixed assets

- Recognition and measurement of provisions and contingencies: key assumptions about the likelihood and magnitude of an outflow of resources

- Impairment of financial assets: key assumptions used in estimating recoverable cash flows

5. Classification of Assets and Liabilities as Current and Non-Current

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

- Expected to be realized or intended to be sold or consumed in normal operating cycle.

- Held primarily for the purpose of trading

- Expected to be realized within twelve months after the reporting period, or

- Cash and cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

An liability is treated as current when:

- It is expected to be settled in normal operating cycle.

- It is held primarily for the purpose of trading

- It is due to be settled within twelve months after the reporting period, or

- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

Deferred tax liabilities are classified as non-current liabilities.

The operating cycle is the time between the acquisition of the assets for processing and their realization in cash and cash equivalents. The Company has identified twelve months as its operating cycle.

6. Property, plant and equipment

Recognition and measurement

Items of property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment loss, if any. The cost of assets comprises of purchase price and directly attributable cost of bringing the assets to working condition for its intended use including borrowing cost and incidental expenditure during construction incurred up to the date when the assets are ready to use. Capital work in progress includes cost of assets at sites, construction expenditure and interest on the funds deployed.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as a separate items (major components) of property, plant and equipment.

Any gain on disposal of property, plant and equipment is recognized in Profit and loss account.

Transition to Ind AS

On transition to Ind AS, the Company has elected to continue with the carrying value of all its property, plant and equipment recognized as at 1 April 2015 measured as per the previous GAAP and use that carrying value as the cost of the property, plant and equipment.

Subsequent Measurement

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the company.

Depreciation

Depreciation on fixed assets is calculated on Straight Line Method using the rates arrived at based on the estimated useful lives given in Schedule II of the Companies Act, 2013.

Depreciation on additions due to machinery spares is provided retrospectively from the date the related assets are put to use. Depreciation on additions to or on disposal of assets is calculated on pro-rata basis. Leasehold land is being amortized over the period of lease tenure.

Depreciation methods, useful lives and residual values are reviewed at each financial year end and changes, if any, are accounted for prospectively.

7. Intangible assets

Intangible Assets are stated at cost less accumulated amortization and impairment loss, if any. Intangible assets

are amortized on straight line method basis over the estimated useful life. Estimated useful life of the Software and designing rights is considered as 3 years.

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the company.

Amortization methods, useful lives and residual values are reviewed in each financial year end and changes, if any, are accounted for prospectively.

An intangible asset with an indefinite useful life is not amortized but is tested for impairment at each reporting date.

8. Financial instruments

A financial instrument is any contract that gives rise to asset of one entity and a financial liability or equity instrument of another entity. Financial instruments also include derivative contracts such as foreign currency, foreign exchange forward contracts, cross currency interest rate swaps, interest rate swaps and currency options; and embedded derivatives in the host contract.

Financial Assets

Initial recognition and measurement

All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that the company commits to purchase or sell the asset.

Classifications

The company classifies its financial assets as subsequently measured at either amortized cost or fair value depending on the company’s business model for managing the financial assets and the contractual cash flow characteristics of the financial assets.

Business model assessment

The company makes an assessment of the objective of a business model in which an asset is held at an instrument level because this best reflects the way the business is managed and information is provided to management.

Debt instruments at amortized cost

A financial asset is measured at amortized cost only if both of the following conditions are met:

- it is held within a business model whose objective is to hold assets in order to collect contractual cash flows.

- the contractual terms of the financial asset represent contractual cash flows that are solely payments of principal and interest.

After initial measurement, such financial assets are subsequently measured at amortized cost using the Effective Interest Rate (‘EIR’) method. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance income in the profit or loss. The losses arising from impairment are recognized in the profit or loss.

Debt instrument at fair value through Other Comprehensive Income (FVOCI)

Debt instruments with contractual cash flow characteristics that are solely payments of principal and interest and held in a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets are classified to be measured at FVOCI.

Debt instrument at fair value through profit and loss (FVTPL)

Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVOCI, is classified as at FVTPL.

In addition, the company may elect to classify a debt instrument, which otherwise meets amortized cost or FVOCI criteria, as at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ‘accounting mismatch’).

Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the profit and loss.

Equity Instruments

All equity instruments in scope of Ind AS 109 are measured at fair value. On initial recognition an equity investment that is not held for trading, the Company may irrevocably elect to present subsequent changes in fair value in OCI. This election is made on an investment-by-investment basis.

All other Financial Instruments are classified as measured at FVTPL.

Derecognition of financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e. removed from the company’s balance sheet) when:

- The rights to receive cash flows from the asset have expired, or

- The company has transferred its rights to receive cash flows from the asset or has assumed an obligation

to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the company has transferred substantially all the risks and rewards of the asset, or (b) the company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the company continues to recognize the transferred asset to the extent of the company’s continuing involvement. In that case, the company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the company could be required to repay.

On derecognition of a financial asset, the difference between the carrying amount of the asset (or the carrying amount allocated to the portion of the asset derecognized) and the sum of (i) the consideration received (including any new asset obtained less any new liability assumed) and (ii) any cumulative gain or loss that had been recognized in OCI is recognized in profit or loss.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortized cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

With regard to trade receivable, the Company applies the simplified approach as permitted by Ind AS 109, Financial Instruments, which requires expected lifetime losses to be recognized from the initial recognition of the trade receivables.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, amortized cost, as appropriate.

All financial liabilities are recognized initially at fair value and, in the case of amortized cost, net of directly attributable transaction costs.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

Financial Liabilities measured at amortized cost

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit and loss.

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term.

Gains or losses on liabilities held for trading are recognized in the profit or loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ loss are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognized in the statement of profit or loss.

Derecognition of financial liabilities

The company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire.

Reclassification of financial assets

The company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The company’s senior management determines change in the business model as a result of external or internal changes which are significant to the company’s operations. Such changes are evident to external parties. A change in the business model occurs when the company either begins or ceases to perform an activity that is significant to its operations. If the company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The company does not restate any previously recognized gains, losses (including impairment gains or losses) or interest.

completion and to make the sale.

ii) Work-in-progress, finished goods and traded goods have been valued as per the principles and basis consistently followed.

iii) Provision for obsolete/ old inventories is made, wherever required.

iv) Inter unit transfers of material for further processing is being made at market rate prevailing at the time of such transfers and inventories of such “transfers” could not be identified separately. Therefore for the purpose of determining weighted average cost, transfer price has been considered. In the opinion of the management such valuation have no material impact on inventory valuation and such stock at the year-end are shown as part of raw materials inventory.

10. Provisions Contingent Liabilities and Assets

Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognized for future operating losses.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognized as interest expense.

Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurance or nonoccurrence of one or more future uncertain events not wholly within the control of the company, are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote.

Contingent Assets are not recognized in the financial statements. However, when the realization of income is virtually certain, then the related asset is not a contingent asset and its recognition is appropriate.

Mines Restoration Expenditure

The expenditure on restoration of the mines based on technical estimates by Internal/External specialists is recognized in the accounts. The total estimated restoration expenditure is apportioned over the estimated quantity of mineral resources (likely to be made available) and provision is made in the accounts based on minerals mined during the year.

11. Revenue Recognition

(a) Sale of goods

Revenue is recognized when the significant risk and rewards of ownership have been transferred to the customer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably. Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are inclusive of excise duty and net of returns, trade discounts and volume rebates.

(b) Revenue (other than sale) is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

(c) Interest income is recognized using the EIR method. The EIR is the rate that exactly discounts the estimated future cash receipts through the expected life of

the financial instrument or a shorter period, where appropriate to the net carrying amount of the financial asset. The EIR is computed basis the expected cash flows by considering all the contractual terms of the financial instrument. The calculation includes all fees, transaction costs, and all other premiums or discounts paid or received between parties to the contract that are an integral part of the effective interest rate.

(d) Insurance Claims: Claims lodged with the insurance Companies are accounting on accrual basis to the extent these are measurable and ultimate collection is reasonably certain.

12. Government Grants and Subsidies

Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant will be received and the Company will comply with all attached conditions.

Government grants that compensate the Company for expenses incurred are recognized in profit or loss as income on a systematic basis in the periods in which the expense is recognized.

Government grants relating to the purchase of property, plant and equipment are included in non-current liabilities as deferred income and are credited to profit or loss on a straight-line basis over the expected lives of the related assets and presented within other income.

13. Employee benefits

(i) Short term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(ii) Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided. The company has following defined contribution plans:

a) Provident fund

b) Superannuation scheme

(iii) Defined benefit plans

The company net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the company, the recognized asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurement of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in Other Comprehensive Income. Net interest expense

(income) on the net defined liability (assets) is computed by applying the discount rate, used to measure the net defined liability (asset), to the net defined liability (asset) at the start of the financial year after taking into account any changes as a result of contribution and benefit payments during the year. Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognized immediately in profit or loss. The company recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

The company has following defined benefit plans: a) Gratuity

The company provides for its gratuity liability based on actuarial valuation of the gratuity liability as at the Balance Sheet date, based on Projected Unit Credit Method, carried out by an independent actuary and contributes to the gratuity fund formed by the Company. The contributions made are recognized as plan assets. The defined benefit obligation as reduced by fair value of plan assets is recognized in the Balance Sheet. Re-measurements are recognized in the Other Comprehensive Income, net of tax in the year in which they arise.

(iv) Other long-term employee benefits

The Company’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value. Re-measurements are recognized in profit or loss in the period in which they arise.

The company has following long term employment benefit plans:

a) Leave encashment

Leave encashment is payable to eligible employees at the time of retirement. The liability for leave encashment, which is a defined benefit scheme, is provided based on actuarial valuation as at the Balance Sheet date, based on Projected Unit Credit Method, carried out by an independent actuary.

14. Foreign currency transactions

Transactions in foreign currencies are translated into the Company’s functional currency at the exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Nonmonetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction. Foreign currency differences are generally recognized in profit or loss.

15. Borrowing Cost

General and specific borrowing costs that are directly attributable to the acquisition, construction of a qualifying asset are capitalized during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

Other borrowing costs are expensed in the period in which they are incurred.

16. Income tax

Income tax expense comprises current and deferred tax.

It is recognized in profit or loss except to the extent that it relates to items recognized directly in equity or in Other Comprehensive Income

i) Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date.

Current tax assets and liabilities are offset only if, the Company:

a) Has a legally enforceable right to set off the recognized amounts; and

b) Intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

ii) Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit nor loss.

Deferred tax assets are recognized for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized; such reductions are reversed when the probability of future taxable profits improves.

Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) The entity has a legally enforceable right to set off current tax assets against current tax liabilities; and

b) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.

17. Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication on impairment. If any such indication exists, then the asset’s recoverable amount is estimated.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or Cash Generating Units (‘CGUs’).

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment loss in respect of assets other than goodwill is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

18. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

The board of directors of the Company has been identified as being the chief operating decision maker by the Management of the company. Refer note 37 for segment information presented.

19. Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand and short-term deposits with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

20. Leases

Leases of property, plant and equipment where the Company, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalized at the lease’s inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in borrowings or other financial liabilities as appropriate. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the less or) are charged to profit or loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the less or’s expected inflationary cost increases.

21. Non Current Assets held for sale

The company classifies noncurrent assets and (or disposal groups) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Actions required to complete the sale should indicate that it is unlikely that significant changes to the sale will be made or that the decision to sell will be withdrawn. Management must be committed to the sale expected within one year from the date of classification.

For these purposes, sale transactions include exchanges of non-current assets for other non-current assets when the exchange has commercial substance. The criteria for held for sale classification is regarded met only when the assets or disposal group is available for immediate sale in its present condition, subject only to terms that are usual and customary for sales of such assets (or disposal group), its sale is highly probable; and it will genuinely be sold, not abandoned. The group treats sale of the asset or disposal group to be highly probable when:

- The appropriate level of management is committed to a plan to sell the asset (or disposal group),

- An active programme to locate a buyer and complete the plan has been initiated

- The asset (or disposal group) is being actively marketed for sale at a price that is reasonable in relation to its current fair value,

- The sale is expected to qualify for recognition as

a completed sale within one year from the date of classification, and

- Actions required to complete the plan indicate that it is unlikely those significant changes to the plan will be made or that the plan will be withdrawn.

22. Investment Property (Property Held For Earning Income Eg Rent)

Property (land or a building or part of a building or both) held to earn rentals or for capital appreciation or both, rather than for, use in the production or supply of goods or services or for administrative purposes; or sale in the ordinary course of businesses are classified as investment property. Investment property is measured initially at its cost, including related transaction costs and where applicable borrowing costs. Investment properties are depreciated using the straight-line method over their estimated useful lives.

23. EPS

Basic earnings per share are computed by dividing the profit for the year by the weighted average number of equity shares outstanding during the period. Diluted earnings per shares is computed by dividing the profit for the year by the weighted average number of equity shares considered for deriving basic earnings per shares and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.

Dividend Income from investments is recognized when the right to receive payment is established.

The company reports separately both assets and liabilities, and income and expenses. Offsetting in the statements of profit and loss or balance sheet, except when offsetting reflects the substance of the transaction or other event, detracts from the ability of users both to understand the transactions, other events and conditions that have occurred and to assess the entity’s future cash flows. The company presents income, by netting the income with related expenses arising on the same transaction. The company presents on a net basis gains and losses arising from a group of similar transactions. However the company presents such gains and losses separately if they are material.

a. Terms and rights attached to equity shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. There is no restriction on distribution of dividend. However, same is subject to the approval of the shareholders in the Annual General Meeting.

Nature and purpose of other reserves/ other equity

General reserve

The Company appropriates a portion to general reserves out of the profits either as per the requirements of the Companies Act 2013 (‘Act’) or voluntarily to meet future contingencies. The said reserve is available for payment of dividend to the shareholders as per the provisions of the Act

Remeasurement of defined benefit plans

“Remeasurements of defined benefit plans represents the following as per Ind AS 19, Employee Benefits:

(a) actuarial gains and losses

(b) the return on plan assets, excluding amounts included in net interest on the net defined benefit liability (asset); and

(c) any change in the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability (asset)”

Dividend

The following dividends were paid by the Company for the year.

Capital management

The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders.

The board of directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position. The Company’s target is to achieve a return on capital above 13.45%; in previous year the return was 7.26%. The weighted-average interest expense on interest-bearing borrowings (excluding liabilities with imputed interest) was 9.93% (Previous year: 10.06%).

The Company monitors capital using a ratio of ‘adjusted net debt’ to ‘adjusted equity’. For this purpose, adjusted net debt is defined as total liabilities, comprising interest-bearing loans and borrowings and obligations under finance leases, less cash and cash equivalents. Adjusted equity comprises all components of equity.


Mar 31, 2014

1. ACCOUNTING CONCEPTS

The financial statements are prepared under the historical cost convention (except for fixed assets which are revalued) on an accrual basis and in accordance with the applicable mandatory Accounting Standards.

2. USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of Financial Statements and the results of operation during the reporting period end. Although these estimates are based upon management''s best knowledge of current event and actions, actual results could differ from these estimates.

3. FIXED ASSETS

Fixed assets are stated at cost adjusted by revaluation of fixed assets. Cost comprises the purchase price and attributable cost of bringing the asset to its working condition for its intended use.

4. DEPRECIATION AND AMORTIZATION

I) Tangible Assets

i) Depreciation is provided on straight line method at the rates specified in the Schedule XIV to the Companies Act, 1956.

ii) Depreciation on additions/deductions to fixed assets is being provided on pro-rata basis from the month of acquisition.

iii) Depreciation on additional value of Revalued Assets is provided on the basis of life determined by the valuers. An amount equivalent to depreciation on additional values resulting from revaluation is withdrawn from Revaluation Reserve and credited to Profit & Loss Account.

iv) Leasehold land is amortised over the period of lease.

II) Intangible Assets

i) Computer Software cost is amortised over a period of three years.

ii) Good will is amortised over a period often years.

5. IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at each balance sheet date. If there is any indication of impairment based on internal and external factors, an impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset''s net selling price and value in use. In assessing value the estimated future cash flows are discounted to their present value at the weighted average cost of capital . For the purpose of accounting of impairment due consideration is given to revaluation of reserves, if any.

After impairment depreciation is provided on the revised carrying amount of the assets over remaining useful life.

6. GOVERNMENT SUBSIDIES

Government grants/subsidies are accounted for only when there is a certainty of receipt.

7. INVESTMENTS

Current investments are stated at lower of cost or fair market value. Long term investments are stated at cost after deducting provisions made for other than temporary diminution in the value, if any

8. INVENTORIES

Inventories are valued at "cost or net realizable value, whichever is lower". Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on a moving weighted average basis(Store Spare parts etc and Raw materials). In respect of work in process and finished goods cost is determined on a monthly moving weighted average basis.

9. SALES

Sale of goods is recognized at the point of sale to customer Sale includes excise duty In order to comply with the accounting interpretation(ASI-l4) issued by the Institute of Chartered Accountants of India, sales(including excise duty ) and net sales(excluding excise duty) is disclosed in Profit & Loss Account.

10. BORROWING COST

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/ construction of qualifying fixed assets are capitalized upto the date when such assets are ready for its intended use and other borrowing costs are charged to Profit & Loss Account.

11. RETIREMENT BENEFITS

The Company''s contributions to Provident Fund and Superannuation Fund are charged to Profit & Loss Account. Contributions to Gratuity Fund are made on actuarial valuation and Provision for Leave encashment are made on the basis of actuarial valuation and charged to Profit & Loss Account.

12. FOREIGN EXCHANGE TRANSACTIONS

Foreign currency transactions are accounted at equivalent rupee value earned/incurred. Year end balance in current assets/ liabilities is accounted at applicable rates. Exchange difference arising on account of fluctuation in the rate of exchange is recognized in the Profit & Loss Account.

Investment in subsidiary company is expressed in Indian Rupees at the rate of exchange prevailing at the date of investment.

13. PROVISION FOR CURRENT AND DEFERRED TAX

Provision for Current Tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act, 1961.

Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future. Permanent timing difference adjustments are not accounted for in provisions.

14. MINES RESTORATION EXPENDITURE

The expenditure on restoration of the mines based on technical estimates by Internal/External specialists is recognized in the accounts. The total estimated restoration expenditure is apportioned over the estimated quantity of mineral resources(likely to be made available) and provision is made in the accounts based on minerals mined during the year

15. OPERATING LEASES

Leases where significant portion of risk and reward of ownership are retained by the lessor are classified as operating leases and lease rentals thereon are charged to the Profit & Loss Account.

16. PROVISION/CONTINGENCY

A provision is recognized when there is a present obligation as a result of past event and it is probable that an outflow of resources embodying economic benefit will be required to settle the obligation in respect of which a reliable estimate can be made. These are reviewed at each Balance sheet date and adjusted to reflect the current best estimates. Contingent Liabilities are disclosed.


Mar 31, 2013

1. Accounting Concepts

The Financial Statements Are Prepared Under The Historical Cost Convention (Except For Fixed Assets Which Are Revalued) On An Accrual Basis And In Accordance With The Applicable Mandatory Accounting Standards.

2. Use OF ESTIMATES

The Preparation Of Financial Statements In Conformity With Generally Accepted Accounting Principles Requires Management To Make Estimates And Assumption That Affect The Reported Amounts Of Assets And Liabilities And Disclosure Of Contingent Liabilities At The Date Of Financial Statements And The Results Of Operation During The Reporting Period End. Although These Estimates Are Based Upon Management''s Best Knowledge Of Current Event And Actions, Actual Results Could Differ From These Estimates.

3. Fixed Assets

Fixed Assets Are Stated At Cost Adjusted By Revaluation Of Fixed Assets. Cost Comprises The Purchase Price And Attributable Cost Of Bringing The Asset To Its Working Condition For Its Intended Use.

4. Depreciation AND AMORTISATION:

I) Tangible Assets

I) Depreciation Is Provided On Straight Line Method At The Rates Specified In The Schedule XIV To The Companies Act, 1956.

Ii) Depreciation On Additions To Fixed Assets Is Being Provided On Pro-Rata Basis From The Month Of Acquisition.

Iii) Depreciation On Additional Value Of Revalued Assets Is Provided On The Basis Of Life Determined By The Valuers. An Amount Equivalent To Depreciation On Additional Values Resulting From Revaluation Is Withdrawn From Revaluation Reserve And Credited To Profit & Loss Account.

Iv) Leasehold Land Is Amortised Over The Period Of Lease.

II) Intangible Assets

I) Computer Software Cost Is Amortised Over A Period Of Three Years.

Ii) Good Will Is Amortised Over A Period Of Ten Years.

5. IMPAIRMENT OF ASSETS

The Carrying Amount Of Assets Is Reviewed At Each Balance- Sheet Date. If There Is Any Indication Of Impairment Based On Internal And External Factors, An Impairment Loss Is Recognised Whenever The Carrying Amount Of An Asset Exceeds Its Recoverable Amount.The Recoverable Amount Is The Greater Of The Asset''s Net Selling Price And Value In Use. In Assessing Value The Estimated Future Cash Flows Are Discounted To Their Present Value At The Weighted Average Cost Of Capital . For The Purpose Of Accounting Of Impairment Due Consideration Is Given To Revaluation Of Reserves, If Any.

After Impairment Depreciation Is Provided In The Revised Carrying Amount Of The Assets Over Remaining Useful Life.

6. Government Subsidies

Government Grants/Subsidies Are Accounted For Only When There Is A Certainty Of Receipt.

7. Investments

Current Investments Are Stated At Lower Of Cost Or Fair Market Value. Long Term Investments Are Stated At Cost After Deducting Provisions Made For Other Than Temporary Diminution In The Value, If Any.

8. Inventories

Inventories Are Valued At ''Cost Or Net Realisable Value, Whichever Is Lower''. Cost Comprises All Cost Of Purchase, Cost Of Conversion And Other Costs Incurred In Bringing The Inventories To Their Present Location And Condition. Cost Is Determined On A Moving Weighted Average Basis (Store Spare Parts Etc And Raw Materials). In Respect Of Work In Process And Finished Goods Cost Is Determined On A Monthly Moving Weighted Average Basis.

9. SALES

Sale Of Goods Is Recognised At The Point Of Sale To Customer. Sale Includes Excise Duty. In Order To Comply With The Accounting Interpretation(ASI-14) Issued By The Institute Of Chartered Accountants Of India, Sales (Including Excise Duty) And Net Sales(Excluding Excise Duty) Is Disclosed In Profit & Loss Account.

10. Borrowing Cost

Interest And Other Costs In Connection With The Borrowing Of The Funds To The Extent Related/Attributed To The Acquisition/ Construction Of Qualifying Fixed Assets Are Capitalised Up To The Date When Such Assets Are Ready For Its Intended Use And Other Borrowing Costs Are Charged To Profit & Loss Account.

11. RETIREMENT BENEFITS

The Company''s Contributions To Provident Fund And Superannuation Fund Are Charged To Profit & Loss Account. Contributions To Gratuity Fund Are Made On Actuarial Valuation And Provision For Leave Encashment Are Made On The Basis Of Actuarial Valuation And Charged To Profit & Loss Account.

12. FOREIGN EXCHANGE TRANSACTIONS

Foreign Currency Transactions Are Accounted At Equivalent Rupee Value Earned/Incurred. Year End Balance In Current Assets/Liabilities Is Accounted At Applicable Rates. Exchange Difference Arising On Account Of Fluctuation In The Rate Of Exchange Is Recognised In The Profit & Loss Account.

Investment In Subsidiary Company Is Expressed In Indian Rupees At The Rate Of Exchange Prevailing At The Date Of Investment.

13. Provision For Current And Deferred Tax

Provision For Current Tax Is Made On The Basis Of Estimated Taxable Income For The Current Accounting Period And In Accordance With The Provisions As Per Income Tax Act, 1961.

Deferred Tax Resulting From ''Timing Difference'' Between Book And Taxable Profit For The Year Is Accounted For Using The Tax Rates And Laws That Have Been Enacted Or Substantially Enacted As On The Balance Sheet Date. The Deferred Tax Asset Is Recognised And Carried Forward Only To The Extent That There Is A Reasonable Certainty That The Assets Will Be Adjusted In Future. Permanent Timing Difference Adjustments Are Not Accounted For In Provisions.

14. Mines Restoration Expenditure

The Expenditure On Restoration Of The Mines Based On Technical Estimates By Internal/External Specialists Is Recognised In The Accounts. The Total Estimated Restoration Expenditure Is Apportioned Over The Estimated Quantity Of Mineral Resources (Likely To Be Made Available) And Provision Is Made In The Accounts Based On Minerals Mined During The Year.

15. Operating Leases

Leases Where Significant Portion Of Risk And Reward Of Ownership Are Retained By The Lessor Are Classified As Operating Leases And Lease Rentals Thereon Are Charged To The Profit & Loss Account.

16. Provision/Contingency

A Provision Is Recognised When There Is A Present Obligation As A Result Of Past Event And It Is Probable That An Outflow Of Resources Embodying Economic Benefit Will Be Required To Settle The Obligation In Respect Of Which A Reliable Estimate Can Be Made. These Are Reviewed At Each Balance-Sheet Date And Adjusted To Reflect The Current Best Estimates. Contingent Liabilities Are Disclosed.


Mar 31, 2012

1. ACCOUNTING CONCEPTS

The financial statements are prepared under the historical cost convention (except for fixed assets which are revalued) on an accrual basis and in accordance with the applicable mandatory Accounting standards.

2. USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of Financial statements and the results of operation during the reporting period end. Although these estimates are based upon management's best knowledge of current event and actions, actual results could differ from these estimates.

3. FIXED ASSETS

Fixed assets are stated at cost adjusted by revaluation of fixed assets. Cost comprises the purchase price and attributable cost of bringing the asset to its working condition for its intended use.

4. DEPRECIATION AND AMORTISATION

I) Tangible Assets

i) Depreciation is provided on straight line method at the rates specified in the schedule XIV to the companies Act, 1956.

ii) Depreciation on additions to fixed assets is being provided on pro-rata basis from the month of acquisition.

iii) Depreciation on additional value of Revalued Assets is provided on the basis of life determined by the valuers.

An amount equivalent to depreciation on additional values resulting from revaluation is withdrawn from Revaluation Reserve and credited to Profit & Loss Account.

iv) Leasehold land is amortised over the period of lease.

II) Intangible Assets

i) computer software cost is amortised over

ii) Good will is amortised over a period of ten years.

5. IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at each balance-sheet date. If there is any indication of impairment based on internal and external factor, an impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount.The recoverable amount is the greater of the asset's net selling price and value in use.

In assessing value the estimated future cash flows are discounted to their present value at the weighted average cost of capital . For the purpose of accounting of impairment due consideration is given to revaluation of reserves, if any.

After impairment depreciation is provided in the revised carrying amount of the assets over remaining useful life.

6. GOVERNMENT SUBSIDIES

Government grants/subsidies are accounted for only when there is a certainty of receipt.

7. INVESTMENTS

current investments are stated at lower of cost or fair market value. Long term investments are stated at cost after deducting provisions made for other than temporary diminution in the value, if any.

8. INVENTORIES

Inventories are valued at "cost or net realisable value, whichever is lower". cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. cost is determined on a moving weighted average basis(store spare parts etc and Raw materials). In respect of work in process and finished goods cost is determined on a monthly moving weighted average basis.

9. SALES

sale of goods is recognized at the point of sale to customer. sale includes excise duty. In order to comply with the accounting interpretation(Asi-14) issued by the Institute of chartered Accountants of india, sales(including excise duty ) and net sales(excluding excise duty) is disclosed in Profit & Loss Account.

10. BORROWING COST

interest and other costs in connection with the borrowing of the funds to the extent related/ attributed to the acquisition/construction of qualifying fixed assets are capitalised upto the date when such assets are ready for its intended use and other borrowing costs are charged to Profit & Loss Account.

11. RETIREMENT BENEFITS

The company's contributions to Provident Fund and Superannuation Fund are charged to Profit & Loss Account. contributions to Gratuity Fund are made on actuarial valuation and Provision for Leave encashment are made on the basis of actuarial valuation and charged to Profit & Loss Account.

12. FOREIGN EXCHANGE TRANSACTIONS

Foreign currency transactions are accounted at equivalent rupee value earned/incurred. Year end balance in current assets/liabilities is accounted at applicable rates. Exchange difference arising on account of fluctuation in the rate of exchange is recognised in the Profit & Loss Account.

Investment in subsidiary company is expressed in indian Rupees at the rate of exchange prevailing at the date of investment.

13. PROVISION FOR CURRENT AND DEFERRED TAX

Provision for current Tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per income Tax Act, 1961.

Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future. Permanent timing difference adjustments are not accounted for in provisions.

14. MINES RESTORATION EXPENDITURE

The expenditure on restoration of the mines based on technical estimates by internal/ External specialists is recognised in the accounts. The total estimated restoration expenditure is apportioned over the estimated quantity of mineral resources(likely to be made available) and provision is made in the accounts based on minerals mined during the year.

15. OPERATING LEASES

Leases where significant portion of risk and reward of ownership are retained by the lessor are classified as operating leases and lease rentals thereon are charged to the Profit & Loss Account.

16. PROVISION/CONTINGENCY

A provision is recognised when there is a present obligation as a result of past event and it is probable that an outflow of resources embodying economic benefit will be required to settle the obligation in respect of which a reliable estimate can be made. These are reviewed at each Balance-sheet date and adjusted to reflect the current best estimates. contingent Liabilities are disclosed.


Mar 31, 2011

1 ACCOUNTING CONCEPTS

The financial statements are prepared underthe historical cost convention (except for fixed assets which are revalued) on an accrual basis and in accordance with the applicable mandatory Accounting Standards.

2. USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of Financial Statements and the results of operation during the reporting period end. Although these estimates are based upon managements best knowledge of current event and actions, actual results could differ from these estimates.

3. FIXED ASSETS

Fixed assets are stated at cost (including expenses related to acquisition and installation) adjusted by revaluation of fixed assets.

4. DEPRECIATION AMD AMORTIZATION

I) TANGIBLE ASSETS:

i) Depreciation is provided on straight line method at the rates specified in the Schedule XIV to the Companies Act, 1956.

ii) Depreciation on additions/deductions to fixed assets is being provided on pro-rata basis from/to the month of acquisition/ disposal.

iii) Depreciation on additional value of Revalued Assets is provided on the basis of life determined by the valuers. An amount equivalent to depreciation on additional values resulting from revaluation is withdrawn from Revaluation Reserve and credited to Profit & Loss Account.

v) Leasehold land is amortised over the period of lease.

II) INTANGIBLE ASSETS:

i) Computer Software cost is amortised over a period of three years.

ii) Good will is amortised over a period often years.

5. IMPAIRMENT OF ASSETS

The carrying amount of assets are reviewed at each balance-sheet date. If there is any indication of impairment based on internal external factor, an impairment loss is recognized wheneverthe carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value

the estimated future cash flows are discounted to their present value at the weighted average cost of capital. For the purpose of accounting of impairment due consideration is given to revaluation of reserves, if any.

After impairment depreciation is provided on the revised carrying amount of the assets over remaining useful life.

6. GOVERNMENT SUBSIDIES

Government grants/subsidies are accounted for only when there is a certainty of receipt.

7. INVESTMENTS

Current investments are stated at lower of cost or fair market value. Long term investments are stated at cost after deducting provisions made for permanent diminution in the value, if any.

8. IMVEMTORIES

Inventories are valued at "cost or net realizable value, whichever is lower". Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringingthe inventories to their present location and condition. First-in-First-out or Average cost method is followed for determination of cost.

9. SALES

Sale of goods is recognized at the point of sale to customer. Sale includes excise duty and value added tax/sales-tax. In order to comply with the accounting interpretation(ASI-14) issued by the Institute of Chartered Accountants of India, sales(including excise duty and sales-tax) and net sales(excluding excise duty and sales-tax) is disclosed in Profit &< Loss Account.

10. SORROWING COST

Interest and other costs in connection with the borrowing of the funds to the extent related/ attributed to the acquisition/construction of qualifying fixed assets are capitalized upto the date when such assets are ready for its intended use and other borrowing costs are charged to Profit &t Loss Account.

11. RETIREMENT BENEFITS

The Companys contributions to Provident Fund and Superannuation Fund are charged to Profit & Loss Account. Contribution to Gratuity Fund are made on actuarial valuation and Provision for Leave encashment are made on the basis of actuarial valuation and charged to Profit & Loss Account.

12. FOREIGN EXCHANGE TRANSACTIONS

Foreign currency transactions are accounted at equivalent rupee value earned/incurred. Year end balance in current assets/liabilities is accounted at applicable rates. Exchange difference arising on account of fluctuation in the rate of exchange is recognized in the Profit & Loss Account.

Investment in subsidiary company is expressed in Indian Rupees at the rate of exchange prevailing at the date of investment.

13. MISCELLANEOUS EXPENDITURE

Preliminary expenses are amortised over a period of five years from the year of commencement of manufacturing activity.

Deferred Revenue Expenses:

Expenses on Mines Development/overburden removal is deferred and amortised over a period of Lease/ extraction from Mines.

14. PROVISION FOR CURRENT AND DEFERRED TAX

Provision for Current Tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act, 1961.

Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future.Permanent timing difference adjustments are not accounted for in provisions.

15. CONTINGENT UABILITES

Contingent liabilities are not provided and are disclosed in Notes on accounts.


Mar 31, 2010

1) Accounting Concepts:

The financial statements are prepared under the historical cost convention (except for fixed assets which are revalued on an accrual basis and in accordance with the applicable mandatory Accounting Standards.

2) Sales

Sale of goods is recognized at the point of sale to customer. Sale includes excise duty and value added tax/sales-tax. In order to comply with the accounting interpretation(ASI-U) issued by the Institute of Chartered Accountants of India, sales (including excise duty and sales-tax) and net sales (excluding excise duty and sales-tax) is disclosed in Profit & Loss Account.

3) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of Financial Statements and the results of operation during the reporting period end. Although these estimates are based upon management’s best knowledge of current event and actions, actual results could differ from these estimates.

4) Fixed Assets

Fixed assets are stated at cost (including expenses related to acquisition and installation) adjusted by revaluation of fixed assets.

5) Investments

Current investments are stated at lower of cost or fair market value. Long term investments are stated at cost after deducting provisions made for permanent diminution in the value, if any.

6) Inventories

nventories are valued at "cost or net realizable value, whichever is lower". Cost comprise all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. First-in-First- ouf or Weighted Average cost method is followed for determination of cost.

7) Depreciation and amortization

I) Tangible Assets

i) Depreciation is provided on straight line method at the rates specified in the Schedule XIV to the Companies Act, 1956.

i) Depreciation on additions/deductions to fixed assets is being provided on pro-rata basis from/to the month of acquisition/disposal.

il Depreciation on additional value of Revalued Assets is provided on the basis of life determined by the valuers. An amount equivalent to depreciation on additional values resulting from revaluation is withdrawn from Revaluation Reserve and credited to Profit & Loss Account.

iv) Leasehold land is amortised over the period of lease.

II) Intangible Assets

i) Computer Software cost is amortised over a period of three years. i) Goodwill is amortised over a period of ten years.

8) Retirement Benefits:

The Companys contributions to Provident Fund and Superannuation Fund are charged to Profit & Loss Account. Contribution to Gratuity Fund are made on actuarial valuation and Provision for Leave encashment are made on the basis of actuarial valuation and charged to Profit & Loss Account.

10) Borrowing Cost

nterest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/ construction of qualifying fixed assets are capitalized upto the date when such assets are ready for its intended use and other borrowing costs are charged to Profit & Loss Account.

11) Government Subsidies

Government grants/subsidies are accounted for only when there is a certainty of receipt.

12) Provision for Current and Deferred Tax

Provision for Current Tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act, 1961.

Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future.Permanent difference adjustments are not accounted for in provisions.

13) Miscellaneous Expenditure

Deferred Revenue Expenses:

Expenses on Mines Development/overburden removal is deferred and amortised over a period of Lease/extraction from Mines.

14) Contingent Liabilities

Contingent liabilities are not provided and are disclosed in Notes on Accounts.

15) Impairment of Assets

The carrying amount of assets are reviewed at each balance-sheet date. If there is any indication of impairment based on internal external factor, an impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value the estimated future cash flows are discounted to their present value at the weighted average cost of capital . For the purpose of accounting of impairment due consideration is given to revaluation reserves, if any.

After impairment depreciation is provided in the revised carrying amount of the assets over remaining useful life.

Find IFSC