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Accounting Policies of Lawreshwar Polymers Ltd. Company

Mar 31, 2016

1. Corporate Information

Lawreshwar Polymers Limited (the company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The company is engaged in manufacturing and selling of a reputed brand "LEHAR" footwear in domestic market.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting policies in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on an accrual basis under the historical cost convention, expect for land and building acquired before 31 March 2005 which are carried at revalued amounts.

The accounting policies adopted in the preparation of financial statements are in consistency with those of previous years.

2.1 Summary of significant Accounting Policies

A. Presentation and disclosure of Financial Statements

The financial statements are prepared and disclosed according to the provisions of the revised Schedule III notified under the Companies Act, 2013.

B. Recognition of Revenue and Expenditure

Revenue is recognized to the extent that it is probable that economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

Sale of Goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of goods.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Other Income" in statement of profit and loss.

Expenses

All expenses are charged in statement of profit and loss as and when they are incurred

C. Fixed Assets and Capital Work in Progress

Fixed assets, except land and building acquired before 31 March 2005, are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the assets to its working condition for the indented use. Any trade discounts and rebates are deducted in arriving at the purchase price. Fixed Assets comprising of Land & Building acquired before 31st March, 2005 are stated at revalued amount.

Capital work in progress comprise of cost of Fixed Assets that are not ready for their intended use as at the Balance Sheet date.

D. Depreciation on Tangible Fixed Assets

Depreciation on fixed assets has been calculated on the basis of useful life of assets prescribed as per schedule II of the Companies Act, 2013. Further the depreciation on addition made during the year has been provided on a pro-rata basis.

Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provisions for diminution in value is made to recognize a decline other than temporary in the value of the investments.

F. Inventory

Inventories are valued at the lower of the cost and net realizable value. Cost of Inventories other than for manufactured finished goods and work in progress is determined on the weighted average basis. Cost of manufactured finished goods and work in progress includes material cost determined on the weighted average basis and also includes appropriate portion of allocable overheads.

G. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident fund are charged to statement of profit and loss for the year when the contributions are due. The company has no obligation, other than the contribution payable to the provident fund.

The company operates gratuity plan as defined benefit plan. The cost of providing benefits under this plan is determined on the basis of actuarial valuation at each year end using the projected unit credit method. Actuarial gains/ losses are recognized at full in the period in which they occur in the statement of profit and loss.

The company treats accumulated leave, as long-term employee benefit for measurement purpose. Such long-term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the year-end. Actuarial gains/ losses are immediately taken to the statement of profit and loss and are not deferred. The company presents the entire leave as a current liability in the balance sheet, since it does not have an unconditional right to defer its settlement for 12 months after the reporting date.

H. Income Tax

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing difference only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situation where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

I Lease

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the lease item, are classified as operating lease. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease terms.

J. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liability are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

K. Foreign Currency Transactions

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transaction. Exchange differences relating to fixed assets are adjusted in the cost of the respective assets. Any other exchange difference is dealt with in the statement of profit and loss.

In respect of forward contracts, the premium of discount on these contracts is recognized as income or expenditure over the period of the contract. Any profit or loss arising on the cancellation or the renewal of such contracts is recognized as income or expense for the year.

L. Impairment of Assets

Management periodically assesses using external & internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset''s net sale price or present value as determined above.

M. Government Grant

Government Grants received against capital subsidy are credited to concerned asset account on the date of receipt and depreciation is charged on remaining value on yearly basis.


Mar 31, 2015

A. Presentation and disclosure of Financial Statements

The financial statements are prepared and disclosed according to the provisions of the revised Schedule III notified under the Companies Act, 2013.

B. Recognition of Revenue and Expenditure

Revenue is recognized to the extent that it is probable that economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

Sale of Goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of goods.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Other Income" in statement of profit and loss.

Expenses

All expenses are charged in statement of profit and loss as and when they are incurred.

C. Fixed Assets and Capital Work in Progress

Fixed assets, except land and building acquired before 31 March 2005, are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the assets to its working condition for' the indended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Fixed Assets comprising of Land & Building acquired before 31st March, 2005 are stated at revalued amount. Capital work in progress comprise of cost of Fixed Assets that are not ready for their intended use as at the Balance Sheet date.

D. Depreciation on Tangible Fixed Assets

Depreciation on fixed assets has been calculated on the basis of useful life of assets prescribed as per schedule II of the Companies Act, 2013. Further the depreciation on addition made during the year has been provided on a pro-rata basis.

E. Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments

Current investments are carried in the financial statements at lower of cost and fair value determind on an individual investment basis. Long-term investments are carried at cost. However, provisions for diminution in value is made to recognize a decline other than temporary in the value of the investments.

F. Inventory

Inventories are valued at the lower of the cost and net realizable value. Cost of Inventories other than for manufactured finished goods and work in progress is determined on the weighted average basis. Cost of manufactured finished goods and work in progress includes material cost determined on the weighted average basis and also includes appropriate portion of allocable overheads.

G. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident fund are charged to statement of profit and loss for the year when the contributions are due. The company has no obligation, other than the contribution payable to the provident fund.

The company operates gratuity plan as defined benefit plan. The cost of providing benefits under this plan is determind on the basis of actuarial valuation at each year end using the projected unit credit method. Actuarial gains/ losses are recognized at full in the period in which they occur in the statement of profit and loss.

The company treats accumulated leave, as long-term employee benefit for measurement purpose. Such long-term compensated absences are provided for based on the actuarial valuation using the projeated unit credit method at the year-end. Actuarial gains/ losses are immediately taken to the statement of profit and loss and are not deferred. The company presents the entire leave as a current liability in the balance sheet, since it does not have an unconditional right to defer its settlement for 12 months after the reporting date.

H. Income Tax

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing difference only to the extent that there is reasonable certainity that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situation where tha company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

I. Lease

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the lease item, are classified as operating lease. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease terms.

J. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liability are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

K. Foreign Currency Transactions

Foreign currency transactions are recorded in the reporting currency, by applying to the oreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transcation. Exchange differences relating to fixed assets are adjusted in the cost of the respective assets. Any other exchange difference is dealt with in the statement of profit and loss.

In respect of forward contracts, the premium or discount on these contracts is recognized as income or expenditure over the period of the contract. Any profit or loss arising on the cancellation or the renewal of such contracts is recognized as income or expense for the year.

L. Impairment of Assets

Management periodically assesses using external & internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset's net sale price or present value as determined above.

M. Government Grant

Government Grants received against capital subsidy are credited to concerned asset account on the date of receipt and depreciation is charged on remaining value on yearly basis.


Mar 31, 2014

Presentation and disclosure of Financial Statements

The financial statements are prepared and disclosed according to the provisions of the revised Schedule VI notified under the Companies Act, 1956.

Recognition of Revenue and Expenditure

Revenue is recognized to the extent that it is probable that economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized.

Sale of Goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of goods.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Other Income" in statement of profit and loss.

Expenses

All expenses are charged in statement of profit and loss as and when they are incurred.

C. Fixed Assets and Capital Work in Progress

Fixed assets, except land and building acquired before 31 March 2005, are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the assets to its working condition for the intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Fixed Assets comprising of Land & Building acquired before 31st March, 2005 are stated at revalued amount.

Capital work in progress comprise of cost of Fixed Assets that are not ready for their intended use as at the Balance Sheet date and Advances against Fixed Assets.

D. Depreciation on Tangible Fixed Assets

Depreciation on fixed assets has been calculated on a Straight Line Method (SLM) at the rates prescribed as per schedule XIV of the Companies Act, 1956. Further the depreciation on addition made during the year has been provided on a pro-rata basis.

E. Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments

Current investments are carried in the financial statements at lower of cost and fair value determind on an individual investment basis. Long-term investments are carried at cost, However, provisions for diminution in value is made to recognize a decline other than temporary in the value of the investments.

F. Inventory

Inventories are valued at the lower of the cost and net realizable value. Cost of Inventories other than for manufactured finished goods and work in progress is determined on the weighted average basis, Cost of manufactured finished goods and work in progress includes material cost determined on the weighted average basis and also includes appropriate portion of allocable overheads.

G. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident fund are charged to statement of profit and loss for the year when the contributions are due. The company has no obligation, otherthan the contribution payable to the provident fund.

The company operates gratuity plan as defined benefit plan. The cost of providing benefits under this plan is determind on the basis of actuarial valuation at each year end using the projected unit credit method. Actuarial gains/ losses are recognized at full in the period in which they occur in the statement of profit and loss.

The company treats accumulated leave, as long-term employee benefit for measurement purpose. Such long-term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the year-end. Actuarial gains/ losses are immediately taken to the statement of profit and loss and are not deferred. The company presents the entire leave as a current liability in the balance sheet, since it does not have an unconditional right to defer its settlement for 12 months after the reporting date.

H. Income Tax

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act. 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing difference only to the extent that there is reasonable certainity that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situation where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

I. Lease

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the lease item, are classified as operating lease Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease terms.

Provisions. Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liability are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

K. Foreign Currency Transactions

Foreign currency transcations are recorded In the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transcation. Exchange differences relating to fixed assets are adjusted in the cost of the respective assets. Any other exchange difference is dealt with in the statement of profit and loss.

In respect of forward contracts, the premium or discount on these contracts is recognized as income or expenditure over the period of the contract Any profit or loss arising on the cancellation or the renewal of such contracts is recognized as income or expense for the year

L. impairment of Assets

Management periodically assesses using external & internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset''s net sale price or present value as determined above.

M. Government Grant

Government Grants received against capital subsidy are credited to concerned asset account on the date of receipt and depreciation is charged on remaining value on yearly basis


Mar 31, 2013

A. Presentation and disclosure of Financial Statements

Tne financial statements are prepared and disclosed according to Ine provisions of tbe revised Scnedule VI notified under Ihe Companies Ad, 1956.

H. Rucpgnrfion gf Rcvnnin? nnd Expr-ndi turn

Revenue is recognii-ed 10 the exient thai ii is probat* 1 her economic benefits win now to 1he nort^ny and Irte revenue can be reliably measured. T ne following specific recognition cnleria nust also be met before revenue Is recognized.

Safe of Goad*

Revenue from sale of goods is recognized when all [he significant risks and rewards of ownership oftho goods have bec*n piipsod to ttw buy**, usually On dspatch or aoOdS

Interest

Interest income is recognized on a line proportion basis taking into accounl the amount outstanding and the applicable Interest rate. InleresL income is included under tne head tHher Income" m statement of prom and loss.

Expenses

All expenses w c*"iart]0d in statement of pntfil and loss as and wh*n they ato inclined.

C- Fixed Assets and C apt til Wtork in Proves*

Fixed assets. except l/*fid nnd Injildinu acquired hefom 31 March 2QQ5, are- Slated at COSt. net of aceuinulrtied depredation and accumulated impairment losses, If any. The cost comprises purchase price, borrowing costs if capitalization critwr^ ero mot and directly attributable cos! of bringing the srasels to its wodung condHion For the indended use. Any irade discounts and! rebate:* or*; dbilurfed in Arriving ^rt 1 he purchase price. Fix ml Assets cnmprtmKj of Land & Building acquired before 31 st March, 2005 are stated at revalued amount.

Capital vto*h m prepress comprise of cosl or Fixed. Assets thai are not ready trjr their intended use as at me Balance

Sheet data and Advances aganst F*ed Assets.

D Dnprniatl oft on Tangible Flxvd Anvets

Depreciation on fked assets has been calculated on a Straight line Metnod (5LM) at Ibe rates prescribed as per schedule XIV of the Companies Act, 1956. Further Ihe depreciation on addlltm made during tne year has been provided an s pro-rata basis.

E. Investments investment, which are readily realisable and intended to he held for not more lhan one year rrom the dale on which such investments are made, are classified as current investments. Al other investments are classified as long-term InvesfrTrtnts

Currant investments are earned in the financial statements at lower of cost and fair value detarmnd on an individual Investment basis. Loitg-temi Investments are carried al cost. However provisions for diminution in value is made Bo recognize a decline other than temporary in Itie value of tbe investments.

F. Inventory

Inventones are valued al tne lower of me cost and nel resBzsble value. Cosl ol Inventories other than Tor manufactured finished goods and work in progress is determined on the weighted average basis. Cost of manufactured finished oood.5 arid worfc in progress includes material cusl
G. Retirement and other employee benefits

Retirement benefit in una form of provident fund is a defined contribution scheme. The. contributions to the provident fund are charged to statement of profit and loss for the year whan the contributions aw duo. The company has no obligation, othertfian the contribution payable to the provident fund.

The company operates gratuity plan as defined benefit plan. The cost of providing benefits under this plan is- determtnd on the basis of actuarial valuation at each year end using the projected unit credit method. Actuarral gains/ losses are recognized at full in the penod in which they occur in the statement of profit and loss.

The company teste aecurnulated leave, as long-term employee benefit for measuremenL purpose. Suth long-term compensated absences are provided for based on the actuarial valuation using the projeared unit credit method at the year-end. Ad ua rial gains/ losses are immediately taken to the statement of profit and loss and are not deferred. The company presents the entire leave as a current labiily in the balance srieot. since il does not have an unconditional right to defer its settlement for 12 months after the reporting date.

H. Income Tax

Current income tax is measured at tfie amount expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, f 961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred tax liablilies are recognized for all laxabte timing differences. Deferred tax assets are recognized far deductible timing difference only to the extent that there is reasonable certain fly that sufficient future taxableincome will be availabfe against whtch such deferred tax assets can be realized. In station where the company has unabsorbed deprecation or carry forward tax losses, all deferred tax assets are recognized only if there is virtu&J certainty supported by convincing evidence that Ihey can be reaJiaed against future taxable profits.

I. Lease

Leases, wnere the lessor effectively retains substantially all trie risks ana: benefits of ownership of the lease item, are classified as operating leese. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease terms.

J. Provisions. Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation m measurement are recognized when there is a present Obligation as a result of past events and i is probable that there
K. Foreign Currency Transactions

Foreign currency transcafjons are recorded r the reporting currency, by applyrig to the foreign currency amount the exchange rate between the reporting currency and (fie foreign currency Bt the date of transcation Exchange differences relating lo fixed assets are adjusted w the Cost of the respective assets. Any other exchange difference is dealt wilh in Ihe statement of profit and loss.

In respect of forward contracts, the premium or discount on these contracts is recognized as income or expenditure over the period of the conlrad. Any profit or loss arising on the cancelation or the renewal of such contracts is recognized as income or expense for the year.

L. Impairment of Assets

Management periodically assesses using external & internal sources whether there is an indication that an asset may be repaired Impairment occurs where the carrying value exceeds (he present value of Future cash flows expected So arise from the continuing use of the asset and its eventual disposal. Tfie impairment loss to be expensed is determined as the excess of the carrying amount over the hgher of the asset''s net sale price or present value as determined above.

Earning Per Share {EPS)

The Company r&Duft Basitj and Dluted sorting per share (EPS) m auoordanee with ^counting Stand ard - 20 Issued by Itie InsHtule of Chartered Accountants of rndla The Bbsks EPS nas bear computed by dividing the Income e^s-lable- to Ltiuity sliarehuldEfra by lh*t wuighEed avfirage number u equity uhum^i ixjlsLLindkiy during lha au^uLmling your Tina Diluted: EPS nave been coniuulad using the weighted average number or equity shares and Diutod potential equity shares


Mar 31, 2010

1 . Basis of Preparation of Financial Statement

Accounting policies not specifically referred to otherwise, are consistent and in consonance with generally accepted accounting principles.

2. Recognition of Income 8 Expenditure

(a) Revenue from sale is recognized on invoicing of goods to customers. Sales are net of sales return & Rate Difference.

(b) Other income like job work charges is recognized monthly on accrual basis.

(c) All expenses are charged to the profits loss account as and when they are incurred.

3. Fixed Assets and Capital Work in Progress

Fixed assets are stated at their historical cost to less accumulated depreciation. Cost of the Fixed Assets is inclusive of taxes, freight and other incidental expenses related to acquisition andiInstallation of the concerned assets.

Capital work in progress comprise of cost of Fixed Assets that are not ready for their intended use as at the Balance Sheet date and Advances against Fixed Assets.

4. Depreciation and Amortization

Depreciation on fixed assets has been provided on Straight Line Method (SLM) at the rates prescribed as per schedule XIV of the Companies Act, 1956. Further the depredation on addition made during the year has been provided on a pro-rata basis.

5. Investments

a) Current Investments are valued at lower of cost and fair value determined on an Individual Investment basis.

b) Long Term Investments are carried at cost. Provision is made for diminution, other than temporary, in the value of such investments.

6. Inventory

Inventories are valued at the lower of the cost and Net realizable value. Cost of Inventories other than for manufactured finished goods and work in progress is determined on the weighted average basis. Cost of manufactured finished goods and work in progress includes material cost determined on the weighted average basis and also Includes appropriate portion of allocable overheads.

7. Retirement Benefits

The cost of all the retirement benefits is charged to Profit and Loss account.

(a) Liability in respect of retirement benefits are provided on the basis of monthly payment to Pension & P.F. under the Employees Provident Fund & Misc. Prov.)Act, 1952, which are charged against revenue,

(b) Gratuity liability & leave encashment of employees is covered under the group gratuity policy and leave encashment policy taken from L.I.C. The annual premium is debited to profit & loss account

8. Miscellaneous Expenditure:

Miscellaneous expenditure consists of Preliminary expenses end Public issue expenses. Preliminary expenses have been amortized over a period of ten years and Public issue & current pre-operative expenses are amortized in five years.

9. Income Tax and Deferred Tax

(a) Provision is made for tax, based on the tax liability computed, after considering tax allowances and deductions In accordance with the provisions of the Income Tax Act, 1961.

(b) Deferred taxis recognized on timing difference, being the deference resulting from the recognition of items in the financial statement and in estimating current Income Tax.

(c) Deferred tax assets are recognized on unabsorbec depreciation and on expenses incurred but to be allowed on payment basis as per the provisions of the Income Tax Act. 1961.

(d) Deferred tax assets and liabllities are measured using the tax rate and tax law that have been enacted on the balance sheet date.

10. Leased Assets

Operating Lease: Rentals are expensed with reference to lease terms and other consideration.

11. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liability are not recognized but are disclosed in the notes. Contingent Assets are neither recognized not disclosed in the financial statements.

12. Impairment of Assets

Management periodically assesses using external& internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The Impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the assets net sale price or present value as determined a bove.


Mar 31, 2009

1. Basis of Preparation of Financial Statement

Accounting policies not specifically referred to otherwise, are consistent and in consonance with generally accepted accounting principles.

2. Recognition of Income & Expenditure

(a) Revenue from sale is recognized on invoicing of goods to customers. Sates are net of sales return & Rate Difference.

(b) Other income like job work charges is recognized monthly on accrual basts.

(c) All expenses are charged to the profit & loss account as and when they are incurred.

3. Fixed Assets and Capital Work In Progress

Fixed assets are stated at their historical cost less accumulated depreciation. Cost of the Fixed Assets is inclusive of taxes, freight and other incidental expenses related to acquisition and installation of the concerned assets.

Capital work in progress comprise of cost of Fixed Assets that are not ready for their intended use as at the Balance Sheet daje and Advances against Fixed Assets.

4. Depreciation and Amortization

Depreciation on fixed assets has been provided on Straight Line Method (SLM) at the rates prescribed as per schedule XtV of the Companies Act, 1956. Further the depreciation on addition made during the year has been provided on a pro-rata basis.

5. Investments

a) Current Investments are valued at lower of cost and fair value determined on an individual investment basis.

b) Long Term investments are carried at cost Provision is made for oiminution, other than temporary, in the value of such investments.

6. Inventory

Inventories are valued at the lower of the cost and Net realizable value. Cost of Inventories other than for manufactured finished goods and work in progress is determined on the weighted average basis. Cost of manufactured finished goods and work in progress includes material cost determined on the weighted average basis and also includes appropriate portion of allocable overheads.

7. Retirement Benefits

The cost of all the retirement benefits is charged to Profit and Loss account

(a) Liability in respect of retirement benefits are provided on the basis of monthly payment to Pension & P.F. under the Employees Provident Fund (& Misc. Prov.)Act, 1952, which are charged against revenue.

(b) Gratuity liability & leave encashment of employees is covered under tne group gratuity policy and leave encashment policy taken from L.I.C. The annual premium is debited to profit & lass account.

8. Miscellaneous Expenditure:

Miscellaneous expenditure consists of Preliminary expenses and Public issue expenses. Preliminary expenses have been amortized over a period of ten years and Public issue & current ore-operative expenses are amortized in five years.

9. Income Tax and Deferred Tax

(a) Provision is made for tax, based on the tax liability computed, after considering tax aSowances and deductions in accordance with the provisions of the Income Tax Act, 1961.

(b) Deferred tax is recognized on timing difference, being the deference resulting from the recognition of items in the financial statement and in estimating current Income Tax.

(c) Deferred tax assets are recognized on unabsorbed depreciation and on expenses incurred but to be allowed on payment basis as per the provisions of the Income TaxAct, 1961.

(d) Deferred tax assets and liabilities are measured using the tax rate and tax law that have been enacted on the balance sheet date.

10. Leased Assets

Operating Lease: Rentals are expensed with reference to tease terms and other consideration.

11. Provisions, Contingent Liabilities and Contingent Asset

Provisions involving substantial degree of estimation in measurement are recognized wnen there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liability are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

12. Assets

Management periodically assesses using external & internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected io arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the assets net sale price or present value as determined above.

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