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Accounting Policies of Maharashtra Seamless Ltd. Company

Mar 31, 2015

A) Basis of Preparation of Financial Statements

The Financial Statements have been prepared to comply with the Generally Accepted Accounting Principles in India (Indian GAAP), including the accounting standards notified under the relevant provisions of the Companies Act, 2013.

The Financial Statements are prepared on accrual basis under the historical cost convention, except for certain fixed assets which are carried at revalued amount.

b) Use of Estimates

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

c) Revenue Recognition

Sale of goods is recognized at the point of dispatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter Division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income except claims is accounted for on accrual basis.

d) Government Grants, Subsidy and Export Incentive

Government grants and subsidies are recognized only when there is reasonable assurance that the conditions attached to them will be complied with and grants / subsidies will be received.

Export incentives are accounted for in the year of exports based on eligibility.

e) Fixed Assets & Depreciation

i) Tangible Fixed Assets

Tangible Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated depreciation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Tangible Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less depreciation.

ii) Depreciation & Amortization

Depreciation on Fixed Assets has been provided on straight line method. Depreciation is provided based on useful life of the assets as prescribed in Schedule II of the Companies Act, 2013 except depreciation on Revalued Assets which has been calculated by using straight line method on the basis of useful life of the assets technically assessed. The additional depreciation on account of revaluation has been adjusted from Revaluation Reserve.

iii) Expenditure during construction period

Expenditure incurred during implementation of new / expansion project is included under Capital Work - in - Progress and the same is allocated to the respective Fixed Assets on completion / erection.

iv) Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Statement of Profit & Loss 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.

v) Intangible Assets

Intangible Assets are stated at cost of acquisition less accumulated Depreciation / Amortization. This includes computer software packages.

f) Investments

Investments are classified as Non - Current or Current based on the management intention at the time of purchase. Non-Current investments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

g) Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realizable value.

Work - in - Process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realizable value whichever is lower.

Finished goods are valued at lower of cost or net realizable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaining in inventory is included as a part of valuation of finished goods.

Stores & Spare parts are valued at lower of cost (Weighted Average Method) or net realizable value.

Scrap is valued at net realizable value.

h) Employee Benefits

i) Short term employee benefits are recognized as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

ii) Post employment and other long term benefits are recognized as an expense in the Profit & 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 at the end of financial year. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit & Loss Account.

iii) Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

i) Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of monetary assets and liabilities and realized gains and losses on foreign exchange transaction are recognized in Profit & Loss Account.

Non-monetary items are carried at cost.

j) Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of asset up to the date when such asset is ready for its intended use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

k) Income-Tax

i) The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current income tax liability.

ii) Deferred tax assets and liabilities are recognized for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred tax assets and liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

iii) Minimum alternate tax credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period.

l) Financial Derivatives Transactions

In respect of forward exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognized as income or expense along with the exchange differences on the underlying assets / liabilities. Further, in case of other contracts with committed exchange rates, the underlying is accounted at the rate so committed. Profit or loss on cancellations / renewals of forward contracts is recognized during the year.

Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract.

m) Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet date and till the date on which the financial statements are approved, which are material in the nature and indicate the need for adjustments in the financial statements have been considered.

n) 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes on financial statements.

Contingent Assets are neither recognized nor disclosed in the financial statement. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.


Mar 31, 2014

A) Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention except for certain fixed assets which had been revalued on accrual basis and in accordance with the requirements of the Companies Act, 1956 and in compliance with the applicable Accounting Standards referred to in sub - section (3C) of the section 211 of the said Act and the other relevant provisions of Companies Act, 1956. The Accounting policies, except otherwise stated, have been consistently applied by the company.

All Assets and Liablities have been classified as current or non - current as per company''s normal operating cycle of 12 months and other criteria set - out in revised Schedule VI of the Companies Act, 1956.

b) Use of Estimates

The preparation of financial statements requires use of estimates and assumptions to be made that affect the reported amounts of assets, liabilities and disclosure of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

c) Revenue Recognition

Sale of goods is recognized at the point of dispatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter Division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income is accounted for on accrual basis. Claims are accounted for, in the year of settlement.

d) Fixed Assets & Depreciation

i) Tangible Fixed Assets

Tangible Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated depreciation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Tangible Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less depreciation.

ii) Depreciation & Amortisation

Depreciation on Fixed Assets including revalued assets has been provided on Straight Line Method basis at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The additional depreciation on Revalued Assets has been calculated on the basis of estimated life of the assets revalued. The additional depreciation on account of Revaluation has been adjusted from Revaluation Reserve.

iii) Expenditure during construction period

Expenditure incurred during implementation of new / expansion project is included under Capital Work in Progress and the same is allocated to the respective Fixed Assets on completion / erection.

iv) Impairment of Assets

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

v) Intangible Assets

Intangible Assets are stated at cost of acquisition less accumulated Depreciation / Amortization. This includes computer software packages.

e) Investments

Investments are classified as Non - Current or Current based on the Management intention at the time of purchase. Non-Current investments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

f) Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realisable value.

Work - in - Process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realisable value whichever is lower.

Finished goods are valued at lower of cost or net realisable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaining in inventory is included as a part of valuation of finished goods.

Stores & Spare parts are valued at lower of cost (Weighted Average Method) or net realisable value.

Scrap is valued at net realisable value.

g) Employee Benefits

i) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

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

iii) Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

h) Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of Monetary assets and liabilities and realized gains and losses on foreign exchange transaction are recognized in Profit & Loss Account.

Non-monetary items are carried at cost.

i) Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of asset upto the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

j) Income-Tax

i) The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current Income Tax liability.

ii) Deferred Tax assets and liabilities are recognised for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred Tax assets and liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

iii) Minimum Alternate Tax credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period.

k) Financial Derivatives Transactions

In respect of forward exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognised as income or expense along with the exchange differences on the underlying assets / liabilities. Further, in case of other contracts with committed exchange rates, the underlying is accounted at the rate so committed. Profit or loss on cancellations / renewals of forward contracts is recognised during the year.

Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract.

l) Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet date and till the date on which the financial statement are approved, which are material in the nature and indicate the need for adjustments in the financial statements have been considered.

m) 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts.

Contingent Assets are neither recognized nor disclosed in the financial statement. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.


Mar 31, 2013

A) Basis of Preparation of Financial Statements

These financial statements have been prepared on an accrual basis and under historical cost convention, except for certain fixed assets which had been revalued and in compliance, in all material aspects with the applicable accounting principles in India, the applicable Accounting Standards notified under Section 211 (3C) and the other relevant provisions of Companies Act, 1956.

All the assets and liabilities have been classified as current or non current as per the companys'' normal operating cycle and other criteria set out in Schedule VI of the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realsation in cash and cash equivalents, the company has ascertained its operating cycle to be 12 months for the purpose of current - non current classification of assets and liabilities.

b) Use of Estimates

The preparation of financial statements requires use of estimates and assumptions to be made that affect the reported amounts of assets, liabilities and disclosure of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

c) Revenue Recognition

Sale of goods is recognized at the point of despatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter Division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income is accounted for on accrual basis. Claims are accounted for, in the year of settlement.

d) Fixed Assets & Depreciation

i) Tangible Fixed Assets

Tangible Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated depreciation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Tangible Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less depreciation.

ii) Depreciation & Amortisation

Depreciation on Fixed Assets including revalued assets has been provided on Straight Line Method basis at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The additional depreciation on revalued assets has been calculated on the basis of estimated life of the assets revalued. The additional depreciation on account of Revaluation has been adjusted from Revaluation Reserve.

iii) Expenditure during construction period

Expenditure incurred during implementation of new / expansion project is included under Capital Work in Progress and the same is allocated to the respective Fixed Assets on completion / erection.

iv) Impairment of Assets

Impairment loss is recognized wherever the carrying amount of an asset is in excess of its recoverable amount and the same is recognized as an expense in the statement of profit and loss and carrying amount of the asset is reduced to its recoverable amount. Post impairment, depreciation is provided on the revised carrying value of the asset over its remaining useful life.

Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset no longer exist or have decreased.

v) Intangible Assets

Intangible Assets are stated at cost of acquisition less accumulated Depreciation / Amortization. This includes computer software packages.

e) Investments

Investments are classified as Non - Current or Current based on the Management intention at the time of purchase. Non - Current investments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

f) Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realisable value.

Work - in - Process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realisable value whichever is lower.

Finished goods are valued at lower of cost or net realisable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaining in inventory is included as a part of valuation of finished goods.

Stores & Spares parts are valued at lower of cost (Weighted Average Method) or net realisable value.

Scrap is valued at net realisable value.

g) Employee Benefits

i) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

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

iii) Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

h) Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of Monetary assets and liabilities and realized gains and losses on foreign exchange transaction are recognized in Profit & Loss Account.

Non-monetary items are carried at cost.

i) Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of asset upto the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

j) Income-Tax

i) The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current Income Tax liability.

ii) Deferred Tax Assets and Liabilities are recognised for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred Tax Assets and Liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

iii) Minimum Alternate Tax credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period.

k) Financial Derivatives Transactions

In respect of Forward Exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognised as income or expense along with the exchange differences on the underlying assets / liabilities. Further, in case of other contracts with committed exchange rates, the underlying is accounted at the rate so committed. Profit or loss on cancellations / renewals of forward contracts is recognised during the year. Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract. l) Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet date and till the date on which the financial statement are approved, which are material in the nature and indicate the need for adjustments in the financial statements have been considered.

m) 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts.

Contingent Assets are neither recognized nor disclosed in the financial statement. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.


Mar 31, 2012

A) Basis of Preparation of Financial Statements

The Company maintains its accounts on accrual basis following the historical cost convention in accordance with the generally accepted accounting principles and the Accounting Standards as specified in the Companies (Accounting Standards) Rules, 2006 prescribed by the Central Government.

The revised Schedule VI notified under the Companies Act, 1956, for preparation and presentation of financial statements has become applicable to the Company for the year ended 31 st March, 2012. The adoption of revised Schedule VI does not impact the recognition and measurement principles followed for preparation of financial statements. However, ,t has significant impact on the presentation and disclosure of the financial statements

b) Use of Estimates

The preparation of financial statements requires use of estimates and assumptions to be made that affect the reported amounts of assets liabilities and disclosure of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

c) Revenue Recognition

Sale of goods is recognized at the point of despatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income is accounted for on accrual basis. Claims are accounted for, in the year of settlement.

d) Fixed Assets & Depreciation

i) Tangible Fixed Assets

Tangible Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated deprecation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Tangible Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less deprecation.

ii) Depreciation & Amortisation

Deprecation on Fixed Assets including revalued assets has been provided on Straight Line Method basis at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The additional deprecation on Revalued Assets has been calculated on the basis of Estimated Life of the Lets revalued. The additional deprecation on account of Revaluation has been adjusted from Revaluation Reserve.

iii) Expenditure during construction period

Expenditure incurred during implementation of new / expansion project is included under Capital Work in Progress and the same is allocated to the respective Fixed Assets on the completion / erection.

iv) Impairment of Assets

Impairment loss is recognized wherever the carrying amount of an asset is in excess of its recoverable amount and the same ,s recognized as an expense in the statement of profit and loss and carrying amount of the asset is reduced to its recoverable amount. Post impairment, deprecation is provided on the revised carrying value of the asset over its remaining useful life.

Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset no longer exist or have decreased.

v) Intangible Assets

Intangible Assets are stated at cost of acquisition less accumulated Deprecation / Amortization. This includes computer software packages.

e) Investments

Investments are classified as Non-Current or Current based on the Management intention at the time of purchase. Non-Current nvestments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

f) Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realisable value, Work-in-process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realisable value whichever is lower.

Finished goods are valued at lower of cost or net realisable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaining in inventory is included as a part of valuation of finished goods.

Stores & Spare parts are valued at lower of cost (Weighted Average Method) or net realisable value.

Scrap is valued at net realisable value.

g) Employee Benefits

i) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

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

iii) Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

h) Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of Monetary assets and liabilities and realized gams and losses on foreign exchange transaction are recognized in profits loss account.

Non-monetary items are earned at cost

Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract,

i) Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of asset upto the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

j) Income-Tax

i) The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current Income Tax liability.

ii) Deferred tax assets and liabilities are recognised for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred tax assets and liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

k) Accounting for Interest in joint Venture

Accounting for Interest in joint Venture is accounted for in accordance with AS -27 issued by The Institute of Chartered Accountants of India.

l) Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet Date and till the date on which the financial statements are approved, which are material in the nature and indicate the need for adjustments in the financial statements have been considered.

m) 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts.

Contingent Assets are neither recognized nor disclosed in the financial statements. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.


Mar 31, 2011

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, on accrual basis of accounting in accordance with the generally accepted accounting principles as applicable, accounting standards issued by The Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

b. Use of Estimates

The preparation of financial statements requires use of estimates and assumptions to be made that affect the reported amounts of assets, liabilities and disclosure of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

c. Revenue Recognition

Sale of goods is recognized at the point of despatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income is accounted for on accrual basis. Claims are accounted for, in the year of settlement.

d. Fixed Assets & Depreciation

- Fixed Assets

Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated deprecation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less deprecation.

- Depreciations Amortisation

Deprecation on Fixed Assets including revalued assets has been provided on Straight Line Method basis at the rates and n the manner specified in Schedule XIV of the Companies Act, 1956. The additional deprecation on Revalued Assets has been calculated on the basis of Estimated Life of the assets revalued. The additional deprecation on account of Revaluation has been adjusted from Revaluation Reserve.

- Expenditure during construction period

All Revenue expenditure incurred during the construction period, which are directly or indirectly attributable to acquisition/ construction of fixed assets, are capitalised at the time of commissioning of such assets.

- Impairment of Assets

Impairment loss is recognized wherever the carrying amount of an asset is in excess of its recoverable amount and the same is recognized as an expense in the statement of profit and loss and carrying amount of the asset is reduced to its recoverable amount. Post impaimient, deprecation is provided on the revised carrying value of the asset over its remaining useful life.

Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset no longer exist or have decreased.

- Intangible Assets

Intangible assets are stated at cost of acquisition less accumulated amortization. These are amortized over a period of time on the basis of estimated useful life based on Managements' estimates.

- Investments

Investments are classified as long-term or current based on the Management intention at the time of purchase. Long-term investments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

- Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realisable value.

Work-in-process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realisable value whichever is lower.

Finished goods are valued at lower of cost or net realisable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaining in inventory is included as a part of valuation of finished goods.

Stores & Spare parts are valued at lower of cost or net realisable value.

Scrap is valued at net realisable value.

- Employee Benefits

- Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

- Post employment and other long term benefits are recognised as an expense in the Profit & Loss Account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques at the end of Financial Year. Actuarial gams and losses in respect of post employment and other long term benefits are charged to the Profit & Loss Account.

- Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

h. Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of Monetary assets and liabilities and realized gams and losses on foreign exchange transaction are recognized in profit & loss account.

Non-monetary items are earned at cost.

Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract.

i. Borrowing Cost

Borrowing costs directly attributable to the acquisition / construction of qualifying assets are capitalised as part of the cost of asset upto the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

j. Income-Tax

- The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current Income Tax liability.

- Deferred tax assets and liabilities are recognised for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred tax assets and liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

k. Accounting for Interest in joint Venture

Accounting for Interest in joint Venture is accounted for in accordance with AS -27 issued by The Institute of Chartered Accountants of India

- Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet Date and till the date on which the Financial Statement are approved, which are material in the nature and indicate the need for adjustments in the Financial Statements have been considered.

m. 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts.

Contingent Assets are neither recognized nor disclosed in the financial statement. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.












Mar 31, 2010

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, on accrual basis of accounting in accordance with the generally accepted accounting principles as applicable, accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

b. Use of Estimates

The preparation of financial statements requires use of estimates and assumptions to be made that affect the reported amounts of assets liabilities and disclosure of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

c. Revenue Recognition

Sale of goods is recognized at the point of despatch to customers and is stated net of Sales Return & Sales Tax and inclusive of Excise Duty. Inter division transfer of goods for captive consumption/ internal uses are at market value. Dividend income is accounted when right to receive the same is established. All other income is accounted for on accrual basis. Claims are accounted for, in the year of settlement.

d. Fixed Assets & Depreciation

i) Fixed Assets

Fixed Assets other than those, which have been revalued, are stated at cost of acquisition, construction less accumulated deprecation and impairment losses. The cost comprises of purchase price and any other directly attributable cost of bringing the assets to working condition for its intended use. Fixed Assets, which have been revalued, are stated at the revalued figures, on the basis of revaluation report of Approved Valuer, less deprecation.

ii) Depreciation & Amortisation

Deprecation on Fixed Assets is provided on Straight Line Method basis at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The additional deprecation on Revalued Assets has been calculated on the basis of Estimated Life of the assets Revalued on Straight Line Method. The additional deprecation on account of Revaluation has been adjusted to Revaluation Reserve.

iii) Expenditure during construction period

Expenditure incurred during implementation of new / expansion project is included under Capital Work in Progress and the same is allocated to the respective Fixed Assets on the completion / erection.

iv) Impairment of Assets

Impairment loss is recognized wherever the carrying amount of an asset is in excess of its recoverable amount and the same is recognized as an expense in the statement of profit and loss and carrying amount of the asset is reduced to its recoverable amount. Post impairment, deprecation is provided on the revised carrying value of the asset over its remaining useful life.

Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset no longer exist or have decreased.

v) Intangible Assets

Intangible assets are stated at cost of acquisition less accumulated amortization. These are amortized over a period of time on the basis of estimated useful life based on Managements estimates.

e Investments

Investments are classified as long-term or current based on the Management intention at the time of purchase. Long-term investments are valued at their acquisition cost. Current investments are stated at lower of cost or fair market value. The 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.

f Inventories

Raw Materials are valued at lower of cost (FIFO basis) or net realisable value,

Work-in-process is valued at direct material cost plus conversion cost depending upon the stage of completion or estimated net realisable value whichever is lower.

Finished goods are valued at lower of cost or net realisable value. Cost for this purpose includes direct material cost plus conversion cost and other direct overheads incurred to bring the goods to their present location & conditions. Excise Duty on goods manufactured by the company and remaning in inventory is included as a part of valuation of finished goods.

Stores & Spare parts are valued at lower of cost or net realisable value.

Scrap is valued at net realisable value

g. Employee Benefits

i) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

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

iii) Payment to defined contribution retirement benefit scheme, if any, is charged as expenses during the year in which related services are rendered.

h. Foreign Currency Transactions

Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. Monetary assets and liabilities related to foreign currency transactions remaining unsettled are translated at year end rate.

The differences in translation of Monetary assets and liabilities and realized gains and losses on foreign exchange transaction are recognized in profits loss account.

Non-monetary items are earried at cost.

Premium / Discount on forward foreign exchange contracts are pro-rated over the period of contract,

i Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of asset upto the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

j. Income-Tax

i) The company, in accordance with relevant tax provision and tax advices wherever considered necessary, calculates the current Income Tax liability.

ii) Deferred tax assets and liabilities are recognised for future tax consequences attributable to the timing differences that results between the profits offered for income tax and profit as per the financial statements. Deferred tax assets and liabilities are measured as per the tax rates / laws that have been enacted or substantively enacted at the Balance Sheet date.

k. Accounting for Interest in joint Venture

Accounting for Interest in joint Venture is accounted for in accordance with AS -27 issued by The Institute of Chartered Accountants of India.

l Events occurring after the Balance Sheet Date

Events occurring after the Balance Sheet Date and till the date on which the Financial Statement are approved, which are material in the nature and indicate the need for adjustments in the Financial Statements have been considered.

m. 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.

Liabilities which are material, and whose future outcome cannot be ascertained with reasonable certainty, are treated as contingent, and disclosed by way of notes to the accounts.

Contingent Assets are neither recognized nor disclosed in the financial statement. Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

 
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