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Accounting Policies of Mahamaya Steel Industries Ltd. Company

Mar 31, 2015

1) Basis of Preparation of Financial Statements

The Financial Statement have been prepared under the historical cost convention, on the basis of a going concern, with revenues recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amount determined as payable or receivable during the year. The financial statements have been prepared in accordance with the generally accepted accounting principles and provisions of the statute have been followed.

2) Use of Estimates

The preparation of financial statements require estimates & assumptions to be made that affect the reported amount of asset and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between actual results and estimates are recognized in the period in which the results are known / materialized.

3) Fixed Assets

Fixed Assets are stated at cost of acquisition inclusive of duties (net of credit under Cenvat / VAT schemes), taxes, incidental expenses, erection / commissioning expenses, including financing cost till commencement and regularization of commercial production, net charges on foreign exchange contracts and adjustments (if any) arising from exchange rate variation relating to borrowing attributable to the fixed assets are capitalized, less accumulated depreciation.

4) Capital Work in progress

It is stated at cost.

5) Depreciation and Amortisation

i) Depreciation is provided based on useful life of the assets and scrape value (5% of the original cost) as prescribed in schedule II to the Companies Act, 2013 except, in respect of Rolls, where useful life taken for one year only as per technical advise.

ii) Amortization is not being made on leasehold land being insignificant amount.

6) Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is normally charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7) Foreign Currency Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated in foreign currencies at the year end rates. In case of monetary items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts has been recognized over the life of the contract.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

8) Investments

Long Term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management.

9) Inventory Valuation

Inventories are valued at lower of cost or net realizable value. Cost of Finished goods is determined by including direct materials, labour, other expenses and a proportion of overheads based on normal operating capacity. Cost of finished goods has been determined on weighted average and includes excise duty. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to make the sale. Cost of raw materials stores and spares, are determined on FIFO basis. By products are valued at net realizable value.

10) Revenue Recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. Turnover includes sale of goods, services, sales tax, service tax, excise duty and sales during trial run period, adjusted for discounts (net), Value Added Tax (VAT) and gain / loss on corresponding hedge contracts. Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

11) Excise Duty

Excise Duty is accounted on the basis of, both, payments made in respect of goods cleared as also provision made for finished goods in stock.

12) Recognition of Income and Expenditure

Mercantile method of accounting is employed unless otherwise specifically stated elsewhere in this schedule. However, where the amount is immaterial/negligible and/or establishment of accrual/determination of amount is not possible, no entries are made for the accruals.

13) Employee's Retirement Benefits

i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

ii) Post employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

14) Borrowing Costs

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

15) Provision for Current and Deferred Tax

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carry forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

16) 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 Liabilities are generally not provided for in books of account and separate disclosure is made in 'Notes on Accounts". Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2014

1) Baals of Preparation of F Inane la I Statements

The Financial Statement have heen prepared under Ihe historical cost convention, on (lie ba-sis of a going concern, with revenues recognized and expenses accounted or their accrual, ncluding previsions / adjustments (or commillcd obligations and amount detwmlned an payable or recehretle during ihe year The financial statements have been prepared in accordance wilhi 1he genera ly accepted accounting pr nciples and previsions of the statute have bee n Tol lowed.

2) Use of Estimates

The preparation of financial statements recuire estimates 4 assumptions to be made that affect the reported amount of asset and liabilities cm the date of financial statements and reported amount of revenues and expenses during Ine reporting period. Difference between actual results and estimates are recognized in the period in which the results are known materialized.

3) Fixed Assets

Fixed Assets are stated at Cost of acquisition inclusive of duties (net of Credit Under Ctenvatf VAT schemes h taxes, incidental expenses, erection I Mmmia5Kinir,g expenses.. Including finaremg cos! till commencement and regulanzalion of commercial product on netcharges on foreign exchange conlracts u';d adjustments (if any) arising from exchange rale variation reiatmg to borrowings nttrlbutanie to ihe toed assets are capitalized, less accumulated depreciation.

4) Capital Work in progress

It is stated at cost.

5) Depreciation and Amortisation

i) Depreciation on fined assets is provided on. straight-line method a1 Ihe rates prescribed in Schedule Xl-V of the Companies Act, 1S5G. Depreciation on acditionsi'deletions to fixed assets i£ beiny provided on pm-rute basis fruuVto Lhc monlfi of acqciSiliynfdiSposal. Fixed nssels C-f like nature nave been Clubbed under broad descriptions given in !he Balance Sheet.

ii Amoriizalion is rot being made on leasehold land being insignificant amount. At ret realisable value.

G) Impairment of Assets

An asset is treated as impaired when the carrying coat of assets exceeds its recoverable value. An Impair me nl loss is normally charged to the Profit ant) Loss Account in the year in which an asset is identified as. it paired The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amounl.

7) Foreign Currency Transactions

i) Transactions denominated in foreign currencies are normally necordec at the exchange rale prevailing aLthc time of the transaction.

ii) Monetary items denominated in foreign currencies at Ihe year ord rates. In case of monetary Items which are covered by forward exchange contracts, the difference between lha yearend rale and rale on Ihe dale of the conlrad is recognized as exchange deference arid thu premium paid on forward conlracli has been recognized over ihe itfe oMhe contract.

iii ) Non monetary foreign currency items are carred at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate lo acquisition affixed assets In wh ch case they arc adjusted lo the carrying cost of such assets.

8) Investments

Long Term investments are stated at cost Provision for diminution m the value of long term investments is made only if such a decline Is other than temporary in the opinion of the management.

9) Inventory Valuation

Inventories are valued at lower of cost or net realizable value. Cost of Finished goads is dele-mined by including direct materials, labour, oltror expenses and a uroportioh or overheads based on normal operating capacity. Cost pf finished gcods has been determined cn weighted average and includes excise duty. Met realizable value is the estimated selling price in thcrordnary course of business, less estimated costs of completion arid lo make the salts-. Cost of raw materials stones and spares, are determined on FIFO basis. By products are valued a1 net realizable value.

10) Revenue Recognition

Revenue is recognized cnly when rt can be reliably measured and it is reasonable tc expect ultimate collection. Turnover includes sale of goods, services, sales tax. service lax, excise duly and sales during trial run ptviori. adjusted for discounts (net), Value Added Tax (VAT) end gain/less on corresponding heege contracts. Dividend income is recocnizea when nght to receive is established Interest income is necogn zed on time prope lion oasis taking into account the amount outstanding and rat* applicable

11} Excise Duty

Excise Duty is accourtlcd on Ihe basis of, both payments mado in nc&pcct of goods clcaruo as also provision made for finished goods in stock.

12) Recognition Income and Expenditure

Mercantile melhod of accounting Is employed un'esn otherwise specifically stated elsewhere n this schedule Hcwever. where the amount is immaterial/iieglig.ble and.'cr ostabl shrrent of accrual 'dalarm ination of a mount is not possi ble. no enfr es arc made for the accruals.

13) Employee's retirement Benefits

difference and the premium paid on forward coo tracts has been recognized over the life of the contract.

i} Short-term employee benefits are recognized as an expense at the un^SCOUnled amount in the profit a nd loss account of the yea'- in which Ihe related service is rendered.

ii} Post employment and other long term employee benefits a re recogit zed as an exnense the Profit and Loss account for the year in which the employee hasrencered services. The expense is reoogn^ed at the present value ei ihe arnounts payable determined using actuarial valuation techniques. Actuarial gams ane losses in neaps nr of post employment and other long Cam benefits a re changed bo the Profit and Loss accounl.

14) Borrowing Coats

Borrowing crate tnat are attributable to foe acquisition, construction or production of qualifying assets are capitalized as part of 60# efsuc^i assets (if any). Aquahtying asset is an asset that necessarily requires a subslanuai period of rime to get ready for Its lmended use or sale. All other borrowing costs are recognized as expenses in the period in which they ana incurred.

15) Provision for Current and Deferred Tax

Provision for current tax is made after taking i nto consideration benefits admissible under the provisions of the into me Tax. Act, 1961 Deferred La* resulting Jrom "liming differences'1 between book and taxable prof I is accounted tor using the tax rates and law's that are enacted or subslanfrvely enacted as on the balance sheet date. The deterred tax asset is recognized and carry forward only te ihc extent thai ihere is a reasonable certainty that (ho asset wil I be realized in future

16) Provisions, Contingent Liabilities and Contingent Assets

Provisions Involving substantial degree of estimation In measurement are recognizee when there is a present obligation as a result of past events and it is probable that there will he an uu1f luw of reseu rccs. Cunlfoga nl Ltibi lies a re generally net provided for in books of accou nt and separate disclosure e made in 'Neics on Accounts" comlngeM Assets are neither recognized nor disclosed in the financial sfatements.


Mar 31, 2012

1) Basis of Preparation of Financial Statements

The Financial Statement have been prepared under the historical cost convention, on the basis of a going concern, with revenues recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amount determined as payable or receivable during the year. The financial statements have been prepared in accordance with the generally accepted accounting principles and provisions of the statute have been followed.

2) Use of Estimates

The preparation of financial statements require estimates & assumptions to be made that affect the reported amount of asset and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between actual results and estimates are recognized in the period in which the results are known / materialized

3) Fixed Assets

Fixed Assets are stated at cost of acquisition inclusive of duties (net of credit under Cenvat/VAT schemes), taxes, incidental expenses, erection / commissioning expenses, including financing cost till commencement and regularization of commercial production, net charges on foreign exchange contracts and adjustments (if any) arising from exchange rate variation relating to borrowings attributable to the fixed assets are capitalized, less accumulated depreciation.

4) Capital Work in progress

It is stated at cost.

5) Depreciation and Amortisation

i) Depreciation on fixed assets is provided on straight-line method at the rates prescribed in Schedule XIV of the Companies Act, 1956. Depreciation on additions/deletions to fixed assets is being provided on pro-rata basis from/to the month of acquisition/disposal. Fixed assets of like nature have been clubbed under broad descriptions given in the Balance Sheet.

ii) Amortization is not being made on leasehold land being insignificant amount. At net realisable value.

6) Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is normally charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7) Foreign Currency Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated m foreign currencies at the year end rates. In case of monetary items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts has been recognized over the life of the contract.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

8) Investments

Long Term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management.

9) Inventory Valuation

Inventories are valued at lower of cost or net realizable value. Cost of Finished goods is determined by including direct maternal. labour, other expenses and a proportion of overheads based on normal operating capacity. Cost of finished goods has been determined on weighted average and includes excise duty. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to make the sale. Cost of raw maternal stores and spares, are determined on FIFO basis. By products are valued at net realizable value.

10) Revenue Recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. Turnover induces sale of goods, services, sales tax, service tax. excise duty and sates during teal run period, adjusted for discounts (net). Value Added Tax (VAT) and gain/loss on corresponding hedge contras. Dividend Income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

11) Excise Duty

Excise Duty is accounted on the basis of, both, payments made in rasped of goods cleared as also provision made for finished goods in stock.

12) Recognition of Income and Expenditure

Mercantile method of accounting is employed unless otherwise specifically stated elsewhere in this schedule. However, where the amount is immaterial/negligible and/or establishment of accrual/determination of amount is not possible, no entries are made for the accruals.

13) Employee's Retirement Benefits

i) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

ii) Post employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques Actuarial games and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

14) Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of cost of such assets (if any). A qualifying asset is an asset that necessnly requires a substantial penned of time to get ready for its intended use or sale. All other borrowing costs are recognized as expenses in the period in which they are incurred.

15) Provision for Current and Deferred Tax

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act. 1961 Deferred tax resulting from liming differences' between book and taxable profit is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carry forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

16) 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 Liabilities are generally not provided for in books of account and separate disclosure is made in "Notes on Accounts". Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2011

1.BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

The Financial Statement have been prepared under the historical cost convention, on the basis of a going concern, with revenues recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amount determined as payable or receivable during the year. The financial statements have been prepared in accordance with the generally accepted accounting principles and provisions of the statute have been followed.

2. USE OF ESTIMATES:

The preparation of financial statements require estimates & assumptions to be made that affect the reported amount of asset and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between actual results and estimates are recognized in the period in which the results are known / materialized.

3. FIXED ASSETS:

Fixed Assets are stated at cost of acquisition inclusive of duties (net of credit under Cenvat / VAT schemes), taxes, incidental expenses, erection / commissioning expenses, including financing cost till commencement and regularization of commercial production, net charges on foreign exchange contracts and adjustments (if any) arising from exchange rate variation relating to borrowings attributable to the fixed assets are capitalized, less accumulated depreciation.

4. CAPITAL WORK-IN-PROGRESS:

It is stated at cost.

5. DEPRECIATION & AMORTISATION:

(a) Depreciation on fixed assets is provided on straight-line method at the rates prescribed in Schedule XIV of the Companies Act, 1956. Depreciation on additions/deletions to fixed assets is being provided on pro-rata basis from/to the month of acquisition/disposal. Fixed assets of like nature have been clubbed under broad descriptions given in the Balance Sheet.

(B) Amortization is not being made on leasehold land being insignificant amount.

6. IMPAIRMENT OF ASSETS:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is normally charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7. FOREIGN CURRENCY TRANSACTIONS:

(a) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(b) Monetary items denominated in foreign currencies at the year end rates. In case of monetary items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts has been recognized over the life of the contract.

(c) Non monetary foreign currency items are carried at cost.

(d) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

8. INVESTMENTS:

Long Term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is otherthan temporary in the opinion of the management.

9.INVENTORY VALUATION:

Inventories are valued at lower of cost or net realizable value. Cost of Finished goods is determined by including direct materials, labour, other expenses and a proportion of overheads based on normal operating capacity. Cost of finished goods has been determined on weighted average and includes excise duty. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to make the sale. Cost of raw materials stores and spares, are determined on FIFO basis. By products are valued at net realizable value.

10. REVENUE RECOGNITION:

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. Turnover includes sale of goods, services, sales tax, service tax, excise duty and sales during trial run period, adjusted for discounts (net), Value Added Tax (VAT) and gain / loss on corresponding hedge contracts. Dividend income is recognized when right to receive is established. Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

11.EXCISE DUTY:

Excise Duty is accounted on the basis of, both, payments made in respect of goods cleared as also provision made for finished goods in stock.

PRECOGNITION OF INCOME & EXPENDITURE:

Mercantile method of accounting is employed unless otherwise specifically stated elsewhere in this schedule. However, where the amount is immaterial/negligible and/or establishment of Accrual/determination of amount is not possible, no entries are made for the accruals.

13.EMPLOYEES' RETIREMENT BENEFITS:

a) Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b) Post employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

14. BORROWING COSTS:

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

15. PROVISION FOR CURRENT AND DEFERRED TAX:

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carry forward only to the extent that there is a reasonable certainty that the asset will be realized in future. i

16. PROVISION, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are generally not provided for in books of account and separate disclosure is made in 'Notes on Accounts". Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2010

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

The Financial Statement have been prepared under the historical cost convention, on the basis of a going concern, with revenues recognized and expenses accounted on their accrual, including provisions / adjustments for committed obligations and amount determined as payable or receivable during the year. The financial statements have been prepared in accordance with the generally accepted accounting principles and provisions of the statute have been followed.

2. USE OF ESTIMATES:

The preparation of financial statements require estimates & assumptions to be made that affect the reported amount of asset and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between actual results and estimates are recognized in the period in which the results are known / materialized.

3. FIXED ASSETS:

Fixed Assets are stated at cost of acquisition inclusive of duties (net of credit under Cenvat / VAT schemes), taxes, incidental expenses, erection / commissioning expenses, including financing cost till commencement and regularization of commercial production, net charges on foreign exchange contracts and adjustments (if any) arising from exchange rate variation relating to borrowings attributable to the fixed assets are capitalized, less accumulated depreciation.

4. CAPITALWORK-IN-PROGRESS:

It is stated at cost.

5. DEPRECIATIONS AMORTISATION:

(a) Depreciation on fixed assets is provided on straight-line method at the rates prescribed in Schedule XIV of the Companies Act, 1956. Depreciation on additions/deletions to fixed assets is being provided on pro-rata basis from/to the month of acquisition/disposal. Fixed assets of like nature have been clubbed under broad descriptions given in the Balance Sheet.

(B) Amortization is not being made on leasehold land being insignificant amount.

6. IMPAIRMENT OF ASSETS:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is normally charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7. FOREIGN CURRENCYTRANSACTIONS:

(A) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

(B) Monetary items denominated in foreign currencies at the year end rates. In case of monetary items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts has been recognized over the life of the contract.

(C) Non monetary foreign currency items are carried at cost.

(D) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

8. INVESTMENTS:

Long Term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management.

9. INVENTORY VALUATION:

Finished goods are measured at lower of cost or net realizable value. Cost includes direct materials, labour, other expenses and a proportion of overheads based on normal operating capacity. Cost of finished goods has been determined on weighted average and includes excise duty. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to make the sale. Cost of raw materials stores and spares, are determined on FIFO basis. By products are valued at net realizable value.

10. TURNOVER:

Turnover includes sale of goods including steel scrap and broken rolls, services, sales tax, excise duty adjusted for discounts (net) and gain/ loss on corresponding hedge contracts.

11. EXCISE DUTY:

Excise Duty is accounted on the basis of, both, payments made in respect of goods cleared as also provision made for finished goods in stock.

12. RECOGNITION OF INCOME & EXPENDITURE:

Mercantile method of accounting is employed unless otherwise specifically stated elsewhere in this schedule. However, where the amount is immaterial/negligible and/or establishment of accrual/determination of amount is not possible, no entries are made for the accruals.

13. EMPLOYEESRETIREMENT BENEFITS:

(a) Companys contribution to Employees Provident Fund is charged to revenue every year.

(b) Gratuity has been accounted for as per actuarial valuation.

14. BORROWING COSTS:

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

15. PROVISION FOR CURRENT AND DEFERRED TAX:

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carry forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

16. PROVISION, CONTINGENT LIABILITIES AND CONTINGENTASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are generally not provided for in books of account and separate disclosure is made in Notes on Accounts". Contingent Assets are neither recognized nor disclosed in the financial statements.

 
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