Mar 31, 2023
i) Revenue in respect of sale of goods is recognised on dispatch of goods from the factory on the basis of tax invoice.
The sales are net of Goods and Service Tax. Further the materials returned/rejected are accounted for in the year of
return/rejections.
ii) For the service rendered the Company recognised revenue on the basis of Stage of Completion Method.
iii) Other income is comprised primarily of interest income, export incentives, exchange gain/loss on forward contracts
and on translation of other assets and liabilities. Other income is recognized on accrual basis except dividend income
which is recognized when the right to receive payment is established.
Property, plant and equipment are stated at cost, less accumulated depreciation and impairment losses, if any. The cost
directly attritubale to acquisition are capitalised until the property, plant & equipment are ready for use, as intended by the
Management.
Advances paid towards the acquisition of property, plant and equipment outstanding at each Balance Sheet date is
classified as capital advances under other non-current assets and the cost of assets not ready to use before such date
are disclosed under "Capital work-in-progress''; Subsequent expenditures relating to property, plant and equipment is
capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the
cost of the item can be measured reliably. Repairs and maintenance costs are recognized in the Statement of Profit and
Loss when incurred. The cost and related accumulated depreciation are eliminated from the financial statements upon
sale or retirement of the asset and the resultant gains or losses are recognized in the Statement of Profit and Loss.
The assets residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted
prospectively, if appropriate.
Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option
to extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the
expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to
extend or terminate the contract will be exercised. In evaluating the lease term, the Company considers factors such as any
significant leasehold improvements undertaken over the lease term, costs relating to the termination of the lease and the
importance of the underlying asset to the Company''s operations taking into account the location of the underlying asset
and the availability of suitable alternatives. The lease term in future periods is reassessed to ensure that the lease term
reflects the current economic circumstances. After considering current and future economic conditions, the Company has
concluded that no changes are required to lease period relating to the existing lease contracts.
Intangible assets acquired separately are carried at cost less accumulated amortisation and accumulated impairment
losses. Cost of a non-monetary asset acquired in exchange of another non-monetary asset is measured at fair value.
Intangible assets are amortised on a straight-line basis over their estimated useful lives.
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the
Standalone Statement of Profit and Loss.
Property, Plant & Equipment
The Company depreciates property, plant and equipment over their estimated useful lives using the straight-line method.
The estimated useful lives of assets are as follows :
Office Building 60 years Factory Building 30 years
Plant & Machinery 15 years Wind Mill 22 years
Office Equipment''s 05 years Furniture & Fixtures 10 years
Vehicles 10 years Computer Hardware 03 years
Depreciation methods, useful lifes and residual values are review periodically, including at each financial year end.
Intangible assets are amortized by straight line method over the estimated useful life of such assets. The useful life is
estimated based on the evaluation of future economic benefits expected of such assets. The amortisation period and
amortisation method are reviewed at least at each financial year. If the expected useful life of assets is significantly different
from previous estimates, the amortisation period is changed accordingly.
i) Raw materials are valued at cost or net realizable value whichever is lower. Cost is computed using first in first out
(FIFO) method.
ii) Work -in -progress include the cost of purchase, appropriate share of cost of conversion and other overhead incurred
in bringing the inventory to its present location and condition.
iii) Finished goods are valued at cost or net realisable value whichever is less. Cost includes cost of purchase, cost of
conversion and other overhead incurred in bringing the inventory to its present location and condition. Obsolete/
slow moving inventories are adequately provided for.
iv) Other stores and spares/consumable are valued at cost after providing for cost of obsolescence, if any.
i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the
transaction or that approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.
iii) In respect of forward exchange contract entered for speculation purpose and expired during the year, the difference
in forward exchange booking rate and spot rate on the date of expiry of contract is dealt in the profit and loss account.
In respect of forward exchange contract entered for speculative purpose and carried forward in next accounting
period, the difference between the forward exchange booking rate and closing interbank rate including premium
upto maturity prevailing at the close of the year are dealt in the profit and loss account.
iv) In respect of branches, which are non-integral foreign operations, all transactions are translated at rates prevailing on
the date of transaction or that approximates the actual rate at the date of transaction. Branch monetary assets and
liabilities are restated at the year-end rates. The exchange difference arising on translation are recognised in other
comprehensive income (OCI).
v) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the
statement of profit and loss.
i) Short Term Employee Benefits
All Employee benefits payable wholly within twelve months of rendering the service are classified as short-term
employee benefits and they are recognized in the period in which employee renders the related service except leave
encashment.
Defined contribution fund are government administered provident fund scheme, employee state insurance scheme
for all employees. The Company''s contribution to defined contribution plans are recognized in the profit & loss
account in the financial year to which they relate.
- Defined Benefit Gratuity Plan
The Company''s gratuity benefit scheme is a defined benefit plan. The Company''s net obligation in respect of the
gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in
return for their service in the current and prior periods; that benefit is discounted to determine its present value and
the fair value of any plan assets is deducted.
The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using
the Projected Unit Credit Method.
The obligation is measured at the present value of the estimated future cash flows. The discount rates used for
determining the present value of the obligation under defined benefit plan, are based on the market yields on
Government Securities as at the balance sheet date.
Actuarial gains and losses are recognised immediately in the balance sheet with a corresponding debit or credit
to retained earnings through other comprehensive income in the period in which they occur. Past service cost is
recognised in the statement of profit and loss in the period of plan amendment.
Compensated absences which are not expected to occur within twelve months after the end of the period in which
the employee renders the related services are recognised as a liability at the present value of the defined benefit
obligation at the balance sheet date, determined based on actuarial valuation using Projected Unit Credit Method.
The discount rates used for determining the present value of the obligation under defined benefit plan, are based on
the market yields on Government Securities as at the balance sheet date.
The tax expenses for the period comprises of current tax and deferred income tax. Tax is recognised in Statement of Profit
and Loss, except to the extent that it relates to items recognised in the Other Comprehensive Income. In which case, the
tax is also recognised in Other Comprehensive Income.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the Income Tax
authorities, based on tax rates and laws that are enacted at the Balance sheet date.
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the Financial
Statements and the corresponding tax bases used in the computation of taxable profit.
"Deferred tax assets are recognised to the extent it is probable that taxable profit will be available against which the
deductible temporary differences, and the carry forward of unused tax losses can be utilised. Deferred tax liabilities and
assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset
realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting
period. The carrying amount of Deferred tax liabilities and assets are reviewed at the end of each reporting period.
Mar 31, 2018
notes on Financial statements for the year ended 31st March, 2018
1. corporate information
Man Industries (India) Limited (hereinafter referred to as â MIIL â or â the company â) is a public company domiciled in India and incorporated under the provisions of the Companies Act,1956. The company is engaged in the business of manufacturing, processing and trading of submerged arc welded pipes & steel products.
2. basis of preparation of financial statements
These financial statements are prepared in accordance with Indian Accounting Standards (âInd ASâ) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values, the provisions of the Companies Act, 2013(âActâ) (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016
Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
3. significant accounting policies
a. Income Recognition
i) Revenue in respect of sale of goods is recognized on dispatch of goods from the factory on the basis of tax invoice. The sales are inclusive of excise duty, but net of Goods and Service Tax and value added tax. Further the materials returned/rejected are accounted for in the year of return/rejections.
ii) For the service rendered the Company recognized revenue on the basis of Stage of Completion Method.
iii) Other income is comprised primarily of interest income, export incentives, exchange gain/loss on forward contracts and on translation of other assets and liabilities. Other income is recognized on accrual basis except dividend income which is recognized when the right to receive payment is established.
b. property, plant and Equipment
Property, plant and equipment are stated at original cost net of tax / duty credit availed, less accumulated depreciation and accumulated impairment losses, if any. The carrying amount of the component accounted for as a separated asset is derecognized when replaced. All other repair and maintenance costs are recognized in the statement of profit and loss as incurred.
Capital work-in-progress includes cost of property, plant and equipment under installation / under development as at the balance sheet date.
Property, plant and equipment are eliminated from financial statement, either on disposal or when retired from active use. Losses arising in case retirement of property, plant and equipment and gains or losses arising from disposal of property, plant and equipment are recognized in the statement of profit and loss in the year of occurrence.
The assetsâ residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.
c. Lease Assets
Leasehold lands in case of operating lease are amortized over the period of lease.
Buildings constructed on leasehold land are depreciated based on the useful life specified in Schedule II to the Companies Act, 2013, where the lease period of land is beyond the life of the building.
In other cases, buildings constructed on leasehold lands are amortized over the primary lease period of the lands.
d. Intangible Fixed Assets
Intangible assets acquired separately are carried at cost less accumulated amortization and accumulated impairment losses. Cost of a non-monetary asset acquired in exchange of another non-monetary asset is measured at fair value. Intangible assets are amortized on a straight-line basis over their estimated useful lives.
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Standalone Statement of Profit and Loss.
e. Depreciation
Tangible Fixed Assets
Consequent to the enactment of the Companies Act, 2013 (The Act) and its applicability for accounting periods commencing from 1st April 2014, the Company has realigned the remaining useful lives of its fixed assets, in accordance with the provisions prescribed under Schedule II of the Act. Consequently, the carrying value (net of residual value) as at 1st April 2014 is being depreciated over the revised remaining useful lives on the basis of straight - line method. The Company has used following useful life to provide depreciation on its fixed assets:
Intangible assets are amortized by straight line method over the estimated useful life of such assets. The useful life is estimated based on the evaluation of future economic benefits expected of such assets. The amortization period and amortization method are reviewed at least at each financial year. If the expected useful life of assets is significantly different from previous estimates, the amortization period is changed accordingly.
f. Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever is lower. Cost is computed using First in First Out (FIFO) method.
ii) Work -in -Progress include the cost of purchase, appropriate share of cost of conversion and other overhead incurred in bringing the inventory to its present location and condition.
iii) Finished goods are valued at cost or net realizable value whichever is less. Cost includes cost of purchase, cost of conversion and other overhead incurred in bringing the inventory to its present location and condition. Obsolete/slow moving inventories are adequately provided for.
iv) Other stores and spares/consumable are valued at cost after providing for cost of obsolescence, if any.
g. Foreign Exchange Fluctuation
i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the year-end are restated at year end rates.
iii) In respect of forward exchange contract entered for speculation purpose and expired during the year, the difference in forward exchange booking rate and spot rate on the date of expiry of contract is dealt in the Profit and Loss Account. In respect of forward exchange contract entered for speculative purpose and carried forward in next accounting period, the difference between the forward exchange booking rate and closing interbank rate including premium up to maturity prevailing at the close of the year are dealt in the Profit and Loss Account.
iv) In respect of branches, which are non-integral foreign operations, all transactions are translated at rates prevailing on the date of transaction or that approximates the actual rate at the date of transaction. Branch monetary assets and liabilities are restated at the year-end rates. The exchange difference arising on translation are recognized in Other Comprehensive Income (OCI).
v) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.
h. Employee Benefits
i) Short Term Employee Benefits
All Employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits and they are recognized in the period in which employee renders the related service except leave encashment.
ii) Long Term Employee Benefits
- Defined Contribution Plans
Defined contribution fund are government administered provident fund scheme, employee state insurance scheme for all employees. The Companyâs contribution to defined contribution plans are recognized in the Profit & Loss Account in the financial year to which they relate.
- Defined Benefit Gratuity Plan
The Companyâs gratuity benefit scheme is a defined benefit plan. The Companyâs net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value and the fair value of any plan assets is deducted.
The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method.
The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.
Actuarial gains and losses are recognized immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. Past service cost is recognized in the statement of profit and loss in the period of plan amendment.
iii) Other Long-Term Employee Benefits
Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as a liability at the present value of the defined benefit obligation at the Balance Sheet date, determined based on actuarial valuation using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.
i. Taxation
Income tax expense comprises current and deferred income tax. Income tax expense is recognized in net profit in the statement of profit and loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in other comprehensive income. Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.
The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. The income tax provision for the interim period is made based on the best estimate of the annual average tax rate expected to be applicable for the full financial year.
Minimum Alternate Tax (MAT) credit is recognized as tax asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax during the specified period.
Deferred income tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized.
j. Provisions, Contingent Liabilities and Contingent Assets
Provision is recognized in the accounts when there is a present obligation as a result of past event(s) and it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed unless the possibility of outflow of resources is remote.
Contingent assets are neither recognized nor disclosed in the financial statements. k. Borrowing Costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.
l. Earnings Per share
In determining Earning per Share, the Company considers the net profit after tax and includes the post-tax effect of any extraordinary / exceptional item. The number of shares used in computing Basic Earnings per Share is the weighted average number of shares outstanding during the period. The number of shares used in computing Diluted Earnings per Share comprises the weighted average shares considered for deriving Basic Earnings per Share and also the weighted average number of shares that could have been issued on the conversion of all dilutive potential equity shares unless the results would be anti - dilutive. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date.
m. Leases:
Leases under which the company assumes substantially all the risks and rewards of ownership are classified as finance leases. When acquired, such assets are capitalized at fair value or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease payments under operating leases are recognized as an expense on a straight line basis in net profit in the Statement of Profit and Loss over the lease term.
n. Impairment of Non-Financial Assets
Intangible assets and property, plant and equipment are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.
If such assets are considered to be impaired, the impairment to be recognized in the Statement of Profit and Loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have
been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.
o. Exceptional Items
Certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the company is such that its disclosure improves the understanding of the performance of the company, such income or expense is classified as an exceptional item and accordingly, disclosed in the notes accompanying to the financial statements.
p. Government Grants
Government grants are recognized where there is reasonable assurance that the grant will be received, and all attached conditions will be complied with.
Where the grant relates to an asset the cost of the asset is shown at gross value and grant thereon is treated as capital grant which is recognized as income in the statement of profit and loss over the period and in proportion in which depreciation is charged.
Revenue grants are recognized in the statement of profit and loss in the same period as the related cost which they are intended to compensate are accounted for.
Where the company receives non-monetary grants, the asset and the grant are recorded gross at nominal amounts and released to the statement of profit and loss over the expected useful life and pattern of consumption of the benefit of the underlying asset by equal annual instilments.
q. Financial Instruments
Initial recognition
The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, that are not at fair value through profit or loss, are added to the fair value on initial recognition.
Subsequent measurement
a. Non-derivative financial instruments
i) Financial assets carried at amortized cost
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
ii) Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Company has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.
iii) Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.
Impairment
The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in profit or loss.
iv) Financial liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value through profit and loss. For trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
v) Investment in subsidiaries
Investment in subsidiaries is carried at cost in the separate financial statements.
b. Derivative financial instruments
The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these contracts is generally a bank.
c. share capital
Ordinary Shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.
Derecognition of financial instruments
The company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Companyâs Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.
r. Fair Value Measurement:
In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting date. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices and dealer quotes. All methods of assessing fair value result in general approximation of value, and such value may never actually be realized.
Mar 31, 2016
1. Corporate Information
Man Industries (India) Limited ( hereinafter referred to as " MIIL " or " the company " ) is a public company domiciled in India and incorporated under the provisions of the Companies Act,1956. The company is engaged in the business of manufacturing, processing and trading of submerged arc welded pipes & steel products.
2. Significant Accounting Policies
a) Basis of Preparation of Financial Statements
The financial statements which have been prepared under the historical cost convention on the accrual basis of accounting, are in accordance with the applicable requirements of the Companies Act, 2013 (the âActâ) and comply in all material aspects with the Accounting Standards prescribed by the Central Government, in accordance with the Companies (Accounting Standards) Rules, 2006, to the extent applicable. The accounting policies have been consistently applied by the Company and are consistent with those used in previous year.
b) Use of Estimates
The preparation of financial statements in conformity with Indian GAAP requires judgments, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the 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) Income Recognition
i) Revenue in respect of sale of goods is recognized on dispatch of goods from the factory on the basis of excise invoice. The sales are inclusive of excise duty but net of value added tax. Further the materials returned/rejected are accounted for in the year of return/rejections.
ii) For the service rendered the Company recognized revenue on the basis of Completed Contract Method.
iii) Export incentives & other miscellaneous income are recognized on accrual basis except dividend on investments which are accounted in the year of receipt .
d) Fixed Asset
i) Tangible Assets
Tangible Assets are stated at cost net of recoverable taxes, trade discounts and rebates and include amounts added on revaluation, less accumulated depreciation and impairment loss, if any. The cost of tangible assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations relating to borrowings attributable to fixed assets.
ii) Intangible Fixed Assets
Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortisation/depletion and impairment loss, if any. The cost comprises purchase price, borrowing costs, and any cost directly attributable to bringing the asset to its working condition for the intended use and net charges on foreign exchange contracts and adjustments arising from exchange rate variations relating to borrowings attributable to fixed assets..
e) Depreciation
i) Tangible Fixed Assets
Consequent to the enactment of the Companies Act, 2013 (The Act) and its applicability for accounting periods commencing from 1st April 2014, the Company has realigned the remaining useful lives of its fixed assets, in accordance with the provisions prescribed under Schedule II of the Act. Consequently the carrying value (net of residual value) as at 1st April 2014 is being depreciated over the revised remaining useful lives on the basis of straight - line method. The Company has used following useful life to provide depreciation on its fixed assets : ,
ii) Intangible Fixed Assets
Intangible assets are amortized by straight line method over the estimated useful life of such assets. The useful life is estimated based on the evaluation of future economic benefits expected of such assets. The amortization period and amortization method are reviewed at least at each financial year. If the expected useful life of assets is significantly different from previous estimates, the amortization period is changed accordingly.
f) Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever is lower. Cost is computed using First in First Out (FIFO) method.
ii) Work -in -Progress include the cost of purchase, appropriate share of cost of conversion and other overhead incurred in bringing the inventory to its present location and condition.
iii) Finished goods are valued at cost or net realizable value whichever is less. Cost includes cost of purchase, cost of conversion and other overhead incurred in bringing the inventory to its present location and condition. Obsolete/slow moving inventories are adequately provided for.
iv) Other stores and spares/consumable are valued at cost after providing for cost of obsolescence, if any.
g) Foreign Exchange Fluctuation
i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the yearend are restated at year end rates.
iii) In respect of forward exchange contract entered for speculation purpose and expired during the year, the difference in forward exchange booking rate and spot rate on the date of expiry of contract is dealt in the Profit and Loss Account. In respect of forward exchange contract entered for speculative purpose and carried forward in next accounting period, the difference between the forward exchange booking rate and closing interbank rate including premium upto maturity prevailing at the close of the year are dealt in the Profit and Loss Account.
iv) In respect of branches, which are non-integral foreign operations, all transactions are translated at rates prevailing on the date of transaction or that approximates the actual rate at the date of transaction. Branch monetary assets and liabilities are restated at the yearend rates.
v) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss, except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.
h) Employee Benefits
i) Short Term Employee Benefits
All Employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits and they are recognized in the period in which employee renders the related service except leave encashment.
ii) Long Term Employee Benefits
- Defined Contribution Plans
Defined contribution fund are government administered provident fund scheme, employee state insurance scheme for all employees. The Companyâs contribution to defined contribution plans are recognized in the Profit & Loss Account in the financial year to which they relate.
- Defined Benefit Gratuity Plan
The Companyâs gratuity benefit scheme is a defined benefit plan. The Companyâs net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value and the fair value of any plan assets is deducted.
The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method.
The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.
Actuarial gains and losses are recognized immediately in the Statement of Profit and Loss .
iii) Other Long Term Employee Benefits
Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as a liability at the present value of the defined benefit obligation at the Balance Sheet date, determined based on actuarial valuation using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.
I) Taxation i) Current Tax
Current Tax provision is made on the basis of taxable income for the year at current rates.
ii) Deferred Tax Provision
Deferred Tax arising from timing difference between the book profit and tax profit is accounted for, at the future rate of tax, to the extent of temporary timing differences that originate in one period and are capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and carry forward losses unless there is a virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.
j) Provisions, Contingent Liabilities and Contingent Assets
Provision is recognized in the accounts when there is a present obligation as a result of past event(s) and it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed unless the possibility of outflow of resources is remote.
Contingent assets are neither recognized nor disclosed in the financial statements.
k) Borrowing Costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.
l) Earnings Per Share:
In determining Earning per Share, the Company considers the net profit after tax and includes the post tax effect of any extraordinary / exceptional item. The number of shares used in computing Basic Earnings per Share is the weighted average number of shares outstanding during the period. The number of shares used in computing Diluted Earnings per Share comprises the weighted average shares considered for deriving Basic Earnings per Share and also the weighted average number of shares that could have been issued on the conversion of all dilutive potential equity shares unless the results would be anti - dilutive. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date
m) Lease:
In respect of Operating Leases, lease rentals are expensed on straight line basis with reference to lease terms and considerations.
n) Provision for Doubtful Debts and Loans and Advances:
Provision is made in the accounts for doubtful debts, loans and advances in cases where the management considers the debts, loans and advances to be doubtful of recovery.
o) 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 and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is increased/ reversed where there has been change in the estimate of recoverable value. The recoverable value is the higher of the assetsâ net selling price and value in use.
p) Investments
Current Investments are carried at lower of cost and market value computed Investment wise. Long Term Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline i other than temporary.
Mar 31, 2015
1 Corporate Information
Man Industries (India) Limited ( hereinafter referred to as ''MIIL'' or
''the company'') is a public company domiciled in India and
incorporated under the provisions of the Companies Act,1956. The
company is engaged in the business of manufacturing, processing and
trading of submerged arc welded pipes & steel products.
a) Basis of Preparation of Financial Statements
The financial statements which have been prepared under the historical
cost convention on the accrual basis of accounting, are in accordance
with the applicable requirements of the Companies Act, 2013 (the 'Act')
and comply in all material aspects with the Accounting Standards
prescribed by the Central Government, in accordance with the Companies
(Accounting Standards) Rules, 2006, to the extent applicable. The
accounting policies have been consistently applied by the Company and
are consistent with those used in previous year.
b) Use of Estimates
The preparation of financial statements in conformity with Indian GAAP
requires judgments, estimates and assumptions to be made that affect
the reported amount of assets and liabilities, disclosure of contingent
liabilities on the date of the 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) Income Recognition
i) Revenue in respect of sale of goods is recognized on dispatch of
goods from the factory on the basis of excise invoice. The sales are
inclusive of excise duty but net of value added tax. Further the
materials returned/rejected are accounted for in the year of
return/rejections.
ii) For the service rendered the Company recognized revenue on the
basis of Completed Contract Method.
iii) Export incentives & other miscellaneous income are recognized on
accrual basis except dividend on investments which are accounted in the
year of receipt.
d) Fixed Asset
i) Tangible Assets
Tangible Assets are stated at cost net of recoverable taxes, trade
discounts and rebates and include amounts added on revaluation, less
accumulated depreciation and impairment loss, if any. The cost of
tangible assets comprises its purchase price, borrowing cost and any
cost directly attributable to bringing the asset to its working
condition for its intended use, net charges on foreign exchange
contracts and adjustments arising from exchange rate variations
relating to borrowings attributable to fixed assets.
ii) Intangible Fixed Assets
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumulated amortization/depletion and impairment loss, if
any. The cost comprises purchase price, borrowing costs, and any cost
directly attributable to bringing the asset to its working condition
for the intended use and net charges on foreign exchange contracts and
adjustments arising from exchange rate variations relating to
borrowings attributable to fixed assets.
e) Depreciation
i) Tangible Fixed Assets
Consequent to the enactment of the Companies Act, 2013 (The Act) and
its applicability for accounting periods commencing from 1st April
2014, the Company has realigned the remaining useful lives of its fixed
assets, in accordance with the provisions prescribed under Schedule II
of the Act. Consequently, in case of assets which have completed their
useful lives (prescribed under Schedule II of the Act), the carrying
value (net of residual value) as at 1st April 2014 has been charged to
the retained earnings and in case of other assets the carrying value
(net of residual value) is being depreciated over the revised remaining
useful lives on the basis of straight  line method. The Company has
used following useful life to provide depreciation on its fixed assets
:
Office Buildings 60 years Factory Buildings 30 years
Plant & Machinery 30 years Wind Mill 22 years
Office Equipment 05 years Furniture & Fixtures 10 years
Vehicles 10 years Computer Hardware 03 years
Notes on Financial Statements for the year ended 31st March, 2015
ii) Intangible Fixed Assets
Intangible assets are amortized by straight line method over the
estimated useful life of such assets. The useful life is estimated
based on the evaluation of future economic benefits expected of such
assets. The amortization period and amortization method are reviewed at
least at each financial year. If the expected useful life of assets is
significantly different from previous estimates, the amortization
period is changed accordingly.
f) Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever
is lower. Cost is computed using First in First Out (FIFO) method.
ii) Work  in  Progress include the cost of purchase, appropriate
share of cost of conversion and other overhead incurred in bringing the
inventory to its present location and condition.
iii) Finished goods are valued at cost or net realizable value
whichever is less. Cost includes cost of purchase, cost of conversion
and other overhead incurred in bringing the inventory to its present
location and condition. Obsolete/slow moving inventories are adequately
provided for.
iv) Other stores and spares/consumable are valued at cost after
providing for cost of obsolescence, if any.
g) Foreign Exchange Fluctuation
i) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the yearend are
restated at year end rates.
iii) In respect of forward exchange contract entered for speculation
purpose and expired during the year, the difference in forward exchange
booking rate and spot rate on the date of expiry of contract is dealt
in the Profit and Loss Account. In respect of forward exchange
contract entered for speculative purpose and carried forward in next
accounting period, the difference between the forward exchange booking
rate and closing interbank rate including premium upto maturity
prevailing at the close of the year are dealt in the Profit and Loss
Account.
iv) In respect of branches, which are non-integral foreign operations,
all transactions are translated at rates prevailing on the date of
transaction or that approximates the actual rate at the date of
transaction. Branch monetary assets and liabilities are restated at the
yearend rates.
v) Any income or expense on account of exchange difference either on
settlement or on translation is recognized in the Statement of Profit
and Loss, except in case of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
h) Employee Benefits
i) Short Term Employee Benefits
All Employee Benefits payable wholly within twelve months of rendering
the service are classified as short term employee Benefits and they are
recognized in the period in which employee renders the related service
except leave encashment.
ii) Long Term Employee Benefits
- Defend Contribution Plans
Defend contribution fund are government administered provident fund
scheme, employee state insurance scheme for all employees. The
Company's contribution to defend contribution plans are recognized in
the Profit & Loss Account in the financial year to which they relate.
- Defend Benefit Gratuity Plan
The Company's gratuity benefit scheme is a defend benefit plan. The
Company's net obligation in respect of the gratuity benefit scheme is
calculated by estimating the amount of future benefit that employees
have earned in return for their service in the current and prior
periods; that benefit is discounted to determine its present value and
the fair value of any plan assets is deducted.
The present value of the obligation under such defend benefit plan is
determined based on actuarial valuation using the Projected Unit Credit
Method.
The obligation is measured at the present value of the estimated future
cash fows. The discount rates used for determining the present value of
the obligation under defend benefit plan, are based on the market
yields on Government Securities as at the Balance Sheet date.
Actuarial gains and losses are recognized immediately in the Statement
of Profit and Loss.
iii) Other Long Term Employee Benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related services are recognized as a liability at the present value of
the defend benefit obligation at the Balance Sheet date, determined
based on actuarial valuation using Projected Unit Credit Method. The
discount rates used for determining the present value of the obligation
under defend benefit plan, are based on the market yields on Government
Securities as at the Balance Sheet date.
i) Taxation
i) Current Tax
Current Tax provision is made on the basis of taxable income for the
year at current rates.
ii) Deferred Tax Provision
Deferred Tax arising from timing difference between the book Profit and
tax Profit is accounted for, at the future rate of tax, to the extent
of temporary timing differences that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and
carry forward losses unless there is a virtual certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized.
j) Provisions, Contingent Liabilities and Contingent Assets
Provision is recognized in the accounts when there is a present
obligation as a result of past event(s) and it is probable that an
outflow of resources will be required to settle the obligation and a
reliable estimate can be made. Provisions are not discounted to their
present value and are determined based on the best estimate required to
settle the obligation at the reporting date. These estimates are
reviewed at each reporting date and adjusted to reflect the current
best estimates.
Contingent liabilities are disclosed unless the possibility of outflow
of resources is remote.
Contingent assets are neither recognized nor disclosed in the financial
statements.
k) Borrowing Costs
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for its intended use. All
other borrowing costs are charged to Profit and Loss account.
l) Earnings Per Share
In determining Earning per Share, the Company considers the net Profit
after tax and includes the post tax effect of any extraordinary /
exceptional item. The number of shares used in computing Basic Earnings
per Share is the weighted average number of shares outstanding during
the period. The number of shares used in computing Diluted Earnings per
Share comprises the weighted average shares considered for deriving
Basic Earnings per Share and also the weighted average number of shares
that could have been issued on the conversion of all dilutive potential
equity shares unless the results would be anti - dilutive. Dilutive
potential equity shares are deemed converted as of the beginning of the
period, unless issued at a later date.
m) Lease
In respect of Operating Leases, lease rentals are expensed on straight
line basis with reference to lease terms and considerations
n) Provision for Doubtful Debts and Loans and Advances
Provision is made in the accounts for doubtful debts, loans and
advances in cases where the management considers the debts, loans and
advances to be doubtful of recovery.
o) 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 and Loss in the year in which an asset is
identified as impaired. The impairment loss recognized in prior
accounting period is increased/ reversed where there has been change in
the estimate of recoverable value. The recoverable value is the higher
of the assets' net selling price and value in use.
p) Investments
Current Investments are carried at lower of cost and market value
computed Investment wise. 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.
Mar 31, 2014
A) Basis of Preparation of Financial Statements
These financial statements have been prepared to comply with Accounting
Principles Generally accepted in India (Indian GAAP), the Accounting
Standards notified under the Companies (Accounting Standards) Rules,
2006 and the relevant provisions of the Companies Act, 1956.
The financial statements have been prepared on accrual basis under the
historical cost convention, except in respect of insurance claims,
liquidated damages, where the exact quantum cannot be ascertained.
b) Use of Estimates
The preparation of financial statements in conformity with Indian GAAP
requires judgements, estimates and assumptions to be made that affect
the reported amount of assets and liabilities, disclosure of contingent
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period.
Difference between the actual results and estimates are recognised in
the period in which the results are known/ materialised.
c) Income Recognition
i) Revenue in respect of sale of goods is recognised on dispatch of
goods from the factory on the basis of excise invoice. The sales are
inclusive of excise duty but net of value added tax. Further the
materials returned/rejected are accounted for in the year of
return/rejections.
ii) For the service rendered the Company recognised revenue on the
basis of Completed Contract Method.
iii) Export incentives & other miscellaneous income are recognised on
accrual basis except dividend on investments which are accounted in the
year of receipt.
d) Fixed Asset
i) Tangible Assets
Tangible Assets are stated at cost net of recoverable taxes, trade
discounts and rebates and include amounts added on revaluation, less
accumulated depreciation and impairment loss, if any. The cost of
tangible assets comprises its purchase price, borrowing cost and any
cost directly attributable to bringing the asset to its working
condition for its intended use, net charges on foreign exchange
contracts and adjustments arising from exchange rate variations
relating to borrowings attributable to fixed assets.
ii) Intangible Fixed Assets
Intangible Assets are stated at cost of acquisition net of recoverable
taxes less accumulated amortisation/depletion and impairment loss, if
any. The cost comprises purchase price, borrowing costs, and any cost
directly attributable to bringing the asset to its working condition
for the intended use and net charges on foreign exchange contracts and
adjustments arising from exchange rate variations relating to
borrowings attributable to fixed assets. .
e) Depreciation
i) Tangible Fixed Assets
Depreciation on Fixed Assets is provided on straight - line method at
the rates and in the manner prescribed under Schedule XIV of the
Companies Act, 1956.
ii) Intangible Fixed Assets
Intangible assets are amortized by straight line method over the
estimated useful life of such assets. The useful life is estimated
based on the evaluation of future economic benefits expected of such
assets. The amortisation period and amortisation method are reviewed
atleast at each financial year. If the expected useful life of assets
is significantly different from previous estimates, the amortisation
period is changed accordingly.
f) Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever
is lower. Cost is computed using First in First Out (FIFO) method.
ii) Work -in -Progress include the cost of purchase, appropriate share
of cost of conversion and other overhead incurred in bringing the
inventory to its present location and condition.
iii) Finished goods are valued at cost or net realisable value
whichever is less. Cost includes cost of purchase, cost of conversion
and other overhead incurred in bringing the inventory to its present
location and condition. Obsolete/slow moving inventories are
adequately provided for.
iv) Other stores and spares/consumable are valued at cost after
providing for cost of obsolescence, if any.
g) Foreign Exchange Fluctuation
i) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the year end
are restated at year end rates.
iii) In respect of forward exchange contract entered for speculation
purpose and expired during the year, the difference in forward exchange
booking rate and spot rate on the date of expiry of contract is dealt
in the Profit and Loss Account. In respect of forward exchange contract
entered for speculative purpose and carried forward in next accounting
period, the difference between the forward exchange booking rate and
closing interbank rate including premium upto maturity prevailing at
the close of the year are dealt in the Profit and Loss Account.
iv) In respect of branches, which are non-integral foreign operations,
all transactions are translated at rates prevailing on the date of
transaction or that approximates the actual rate at the date of
transaction. Branch monetary assets and liabilities are restated at the
year end rates.
v) Any income or expense on account of exchange difference either on
settlement or on translation is recognised in the Statement of Profit
and Loss, except in case of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
h) Employee Benefits
i) Short Term Employee Benefits
All Employee benefits payable wholly within twelve months of rendering
the service are classified as short term employee benefits and they are
recognized in the period in which employee renders the related service
except leave encashment.
ii) Long Term Employee Benefits
* Defined Contribution Plans
Defined contribution fund are government administered provident fund
scheme, employee state insurance scheme for all employees. The
Company''s contribution to defined contribution plans are recognized in
the Profit & Loss Account in the financial year to which they relate.
* Defined Benefit Gratuity Plan
The Company''s gratuity benefit scheme is a defined benefit plan. The
Company''s net obligation in respect of the gratuity benefit scheme is
calculated by estimating the amount of future benefit that employees
have earned in return for their service in the current and prior
periods; that benefit is discounted to determine its present value and
the fair value of any plan assets is deducted.
The present value of the obligation under such defined benefit plan is
determined based on actuarial valuation using the Projected Unit Credit
Method.
The obligation is measured at the present value of the estimated future
cash flows. The discount rates used for determining the present value
of the obligation under defined benefit plan, are based on the market
yields on Government Securities as at the Balance Sheet date.
Actuarial gains and losses are recognised immediately in the Statement
of Profit and Loss .
iii) Other Long Term Employee Benefits
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related services are recognised as a liability at the present value of
the defined benefit obligation at the Balance Sheet date, determined
based on actuarial valuation using Projected Unit Credit Method. The
discount rates used for determining the present value of the obligation
under defined benefit plan, are based on the market yields on
Government Securities as at the Balance Sheet date.
i) Taxation
i) Current Tax
Current Tax provision is made on the basis of taxable income for the
year at current rates.
ii) Deferred Tax Provision
Deferred Tax arising from timing difference between the book profit and
tax profit is accounted for, at the future rate of tax, to the extent
of temporary timing differences that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and
carry forward losses unless there is a virtual certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized.
j) Provisions, Contingent Liabilities and Contingent Assets
Provision is recognised in the accounts when there is a present
obligation as a result of past event(s) and it is probable that an
outflow of resources will be required to settle the obligation and a
reliable estimate can be made. Provisions are not discounted to their
present value and are determined based on the best estimate required to
settle the obligation at the reporting date. These estimates are
reviewed at each reporting date and adjusted to reflect the current
best estimates.
Contingent liabilities are disclosed unless the possibility of outflow
of resources is remote.
Contingent assets are neither recognised nor disclosed in the financial
statements.
k) Borrowing Costs
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for its intended use. All other
borrowing costs are charged to Profit and Loss account.
l) Earning Per Share:
In determining Earning per Share, the Company considers the net profit
after tax and includes the post tax effect of any extraordinary /
exceptional item. The number of shares used in computing Basic Earning
per Share is the weighted average number of shares outstanding during
the period. The number of shares used in computing Diluted Earning per
Share comprises the weighted average shares considered for deriving
Basic Earnings per Share and also the weighted average number of shares
that could have been issued on the conversion of all dilutive potential
equity shares unless the results would be anti - dilutive. Dilutive
potential equity shares are deemed converted as of the beginning of the
period, unless issued at a later date.
m) Lease :
In respect of Operating Leases, lease rentals are expensed on straight
line basis with reference to lease terms and considerations.
n) Provision for Doubtful Debts and Loans and Advances:
Provision is made in the accounts for doubtful debts, loans and
advances in cases where the management considers the debts, loans and
advances to be doubtful of recovery.
o) 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 and Loss in the year in which an asset is
identified as impaired. The impairment loss recognised in prior
accounting period is increased/ reversed where there has been change in
the estimate of recoverable value. The recoverable value is the higher
of the assets'' net selling price and value in use.
p) Investments
Current Investments are carried at lower of cost and market value
computed Investment wise. 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.
q) Employee Stock Option Scheme
In respect of stock Options granted pursuant to the Company''s Employee
Stock Options Scheme, the intrinsic value of the Options (excess of
market price of the share over the exercise price of the Option) is
treated as discount and accounted as employee compensation cost over
the vesting period. Employee compensation cost recognised earlier on
grant of Options is reversed in the period when the Options are
surrendered by any employee.
Mar 31, 2013
A) Basis of Preparation of Financial Statements :
The financial statements have been prepared under the historical cost
convention in accordance with the generally accepted accounting
principles and the provisions of the Companies Act, 1956 as adopted
consistently by the Company. All income & expenditure items having a
material bearing on the financial statements are recognized on accrual
basis, except in respect of insurance claims, liquidated damages, where
the exact quantum cannot be ascertained.
b) Use of Estimates
The presentation of financial statements require estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of financial statements and the reported amount
of revenues and expenses during the reported period. These adjustments
are based on the managements best knowledge of current events and
actions, uncertainty about these assumptions and estimates could result
in outcomes requiring a material adjustments to the carrying amounts of
assets and liabilities in future periods.
c) Income Recognition
i) Revenue in respect of sale of goods is recognised on dispatch of
goods from the factory on the basis of excise invoice. The sales are
inclusive of excise duty but net of value added tax. Further the
materials returned/rejected are accounted for in the year of
return/rejections.
ii) For the service rendered the Company recognised revenue on the
basis of Completed Contract Method.
iii) Export incentives & other miscellaneous income are recognised on
accrual basis except dividend on investments which are accounted in the
year of receipt .
d) Fixed Asset
i) Tangible Assets
Fixed assets are stated at cost net of recoverable taxes, less
accumulated depreciation and impairment loss, if any. The cost include
cost of acquisition including any direct attributable cost for bringing
the assets to its working condition for intended use, borrowing costs
and adjustment arising from exchange rate variations, relating to
borrowings attributable to fixed assets.
ii) Intangible Fixed Assets :
Intangible assets acquired separately are measured at cost net of
recoverable taxes, less accumulated amortisation and impairment loss,
if any. The cost include cost of acquisition including any directly
attributable cost for bringing the assets to its working condition for
intended use, borrowing cost and adjustment arising from exchange rate
variations, relating to borrowings attributable to fixed assets.
e) Depreciation
i) Tangible Fixed Assets
Depreciation on Fixed Assets is provided on straight-line method at the
rates and in the manner prescribed under Schedule XIV of the Companies
Act, 1956.
ii) Intangible Fixed Assets
Intangible assets are amortized by straight-line method over the
estimated useful life of such assets. The useful life is estimated
based on the evaluation of future economic benefits expected of such
assets. The amortisation period and amortisation method are reviewed
atleast at each financial year. if the expected useful life of assets
is significantly different from previous estimates, the amortisation
period is changed accordingly.
f) Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever
is lower. Cost is computed using
FIFO method.
ii) Work-in-Progress include the cost of purchase, appropriate share of
cost of conversion and other overhead incurred in bringing the
inventory to its present location and condition.
iii) Finished goods are valued at cost or net realisable value
whichever is less. Cost includes cost of purchase, cost of conversion
and other overhead incurred in bringing the inventory to its present
location and condition. Obsolete/slow moving inventories are adequately
provided for.
iv) Other stores and spares/consumable are valued at cost after
providing for cost of obsolescence, if any.
g) Foreign Exchange Fluctuation
i) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
ii) Monetary items denominated in foreign currencies at the year end
are restated at year end rates.
iii) In respect of forward exchange contract entered for speculation
purpose and expired during the year, the difference in forward exchange
booking rate and spot rate on the date of expiry of contract is dealt
in the Profit and Loss Account. In respect of forward exchange contract
entered for speculative purpose and carried forward in next accounting
period, the difference between the forward exchange booking rate and
closing interbank rate including premium upto maturity prevailing at
the close of the year are dealt in the Profit and Loss Account.
iv) Any income or expense on account of exchange difference either on
settlement or on translation is recognised in the Profit and Loss
account except in case of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
h) Employee Benefits
i) Short Term Employee Benefits :
All Employee benefits payable wholly within twelve months of rendering
the service are classified as short term employee benefits and they are
recognized in the period in which employee renders the related service
except leave encashment.
ii) Long Term Employee Benefits :
- Defined Contribution Plans
Defined contribution fund are government administered provident fund
scheme, employee state insurance scheme for all employees. The
Company''s contribution to defined contribution plans are recognized in
the Profit & Loss Account in the financial year to which they relate.
- Defined Benefit Gratuity Plan
The Company''s gratuity benefit scheme is a defined benefit plan. The
Company''s net obligation in respect of the gratuity benefit scheme is
calculated by estimating the amount of future benefit that employees
have earned in return for their service in the current and prior
periods; that benefit is discounted to determine its present value and
the fair value of any plan assets is deducted.
The present value of the obligation under such defined benefit plan is
determined based on actuarial valuation using the Projected Unit Credit
Method.
The obligation is measured at the present value of the estimated future
cash flows. The discount rates used for determining the present value
of the obligation under defined benefit plan, are based on the market
yields on Government Securities as at the Balance Sheet date.
Actuarial gains and losses are recognised immediately in the Statement
of Profit and Loss .
iii) Other Long Term Employee Benefits :
Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the
related services are recognised as a liability at the present value of
the defined benefit obligation at the Balance Sheet date, determined
based on actuarial valuation using Projected Unit Credit Method. The
discount rates used for determining the present value of the obligation
under defined benefit plan, are based on the market yields on
Government Securities as at the Balance Sheet date.
I) Taxation
i) Current Tax :
Current Tax provision is made on the basis of taxable income for the
year at current rates.
ii) Deferred Tax Provision :
Deferred Tax arising from timing difference between the book profit and
tax profit is accounted for, at the future rate of tax, to the extent
of temporary timing differences that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and
carry forward losses unless there is a virtual certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized.
j) Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources. A
disclosure for a contingent liability is made when there is a possible
obligation or a present obligation that may, but probably will not,
require an outflow of resources. When there is a possible obligation or
a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made. Contingent
assets are neither recognised nor disclosed in the Financial
Statements.
k) Borrowing Costs:
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for its intended use. All other
borrowing costs are charged to Profit and Loss account.
l) Earning Per Share
In determining Earning per Share, the Company considers the net profit
after tax and includes the post tax effect of any extraordinary /
exceptional item. The number of shares used in computing Basic Earning
per Share is the weighted average number of shares outstanding during
the period. The number of shares used in computing Diluted Earning per
Share comprises the weighted average shares considered for deriving
Basic Earnings per Share and also the weighted average number of shares
that could have been issued on the conversion of all dilutive potential
equity shares unless the results would be anti-dilutive. Dilutive
potential equity shares are deemed converted as of the beginning of the
period, unless issued at a later date.
m) Lease :
In respect of Operating Leases, lease rentals are expensed on straight
line basis with reference to lease terms and considerations
n) Provision for Doubtful Debts and Loans and Advances
Provision is made in the accounts for doubtful debts, loans and
advances in cases where the management considers the debts, loans and
advances to be doubtful of recovery.
o) 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 and Loss in the year in which an asset is
identified as impaired. The impairment loss recognised in prior
accounting period is increased/ reversed where there has been change in
the estimate of recoverable value. The recoverable value is the higher
of the assets'' net selling price and value in use.
p) Investments
Current Investments are carried at lower of cost and market value
computed Investment wise. 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.
q) Employee Stock Option Scheme
In respect of stock Options granted pursuant to the Company''s Employee
Stock Options Scheme, the intrinsic value of the Options (excess of
market price of the share over the exercise price of the Option) is
treated as discount and accounted as employee compensation cost over
the vesting period. Employee compensation cost recognised earlier on
grant of Options is reversed in the period when the Options are
surrendered by any employee.
Mar 31, 2012
A) Change in Presentation and. Disclosure of financial statement
During the year ended March 31, 2012, the revised Schedule VI notified
under the Companies Act, 1956 has become applicable to the Company, for
preparation and presentation of financial statements. The adoption of
revised Schedule VI does not impact recognition and measurement
principle followed for preparation of financial statements. The Company
has also reclassified the previous year figures in accordance with the
requirement of revised Schedule VI.
b) Basis Of Preparation Of Financial Statements :
The financial statements have been prepared under the historical cost
convention in accordance with the generally accepted accounting
principles and the provisions of the Companies Act, 1956 as adopted
consistently by the Company. All income & expenditure items having a
material bearing on the financial statements are recognized on accrual
basis, except in respect of insurance claims, liquidated damages, where
the exact quantum cannot be ascertained.
c) Use Of Estimates
The presentation of financial statements require estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of financial statements and the reported amount
of revenues and expenses during the reported period.These adjustments
are based on the managements best knowledge of current events and
actions, uncertainty about these assumptions and estimates could result
in outcomes requiring a material adjustments to the carrying amounts of
assests and liabilities in future periods.
d) Income Recognition
i) Revenue in respect of sale of goods is recognised on dispatch of
goods from the factory on the basis of excise invoice. The sales are
inclusive of excise duty but net of value added tax. Further the
materials returned/rejected are accounted for in the year of
return/rejections.
ii) For the service rendered the Company recognised revenue on the
basis of Completed Contract Method.
iii) Export incentives & other miscellaneous income are recognised on
accural basis except dividend on investments which are accounted in the
year of receipt .
e) Fixed Asset
i) Valuation of Fixed Assets
Tangible Assets
Fixed Assets are stated at cost less accumulated depreciation and
accumulated impairment loss, if any. The cost include cost of
acquisition including any direct attributable cost for bringing the
assets to its working condition for intended use, borrowing costs if
capitalisation criteria are met and exclusive of recoverable taxes. Any
trade discounts and rebates are deducted in arriving the cost of
acquisition.
Gain or losses arising from derecognition of fixed assets are measured
as the difference between the net disposal proceeds and the carrying
amount of the asset and are recognised in the statement of profit and
loss when the assets are derecognised.
Intangible Fixed Assets :
Intangible assets acquired separately are measured at cost less
accumulated depreciation and accumulated impairment loss, if any. The
cost include cost of acquisition including any directly attributable
cost for bringing the assets to its working condition for intended use,
borrowing cost if capitalisation criteria are met and exclusive of
recoverable taxes.
Gain or losses arising from derecognition of fixed assets are measured
as the difference between the net disposal proceeds and the carrying
amount of the asset and are recognised in the statement of profit and
loss when the assets are derecognised.
ii) Depreciation
Tangible Fixed Assets
Depreciation on Fixed Assets is provided on straight - line method at
the rates and in the manner prescribed under Schedule XIV of the
Companies Act, 1956.
Intangible Fixed Assets
Intangible assets are amortized by straight line method over the
estimated useful life of such assets. The useful life is estimated
based on the evaluation of future economic benefits expected of such
assets. The amortisation period and amortisation method are reviewed
atleast at each financial year. if the expected useful life of assets
is significantly different from previous estimates, the amortisation
period is changed accordingly The Company has written off software over
the 5 years period.
f) Valuation of Inventories
i) Raw materials are valued at cost or net realizable value whichever
is lower. Cost is computed using FIFO method.
ii) Work -in -Progress include the cost of purchase, appropriate share
of cost of conversion and other overhead incurred in bringing the
inventory to its present location and condition
iii) Finished goods are valued at cost or net realisable value
whichever is less. Cost includes cost of purchase, cost of conversion
and other overhead incurred in bringing the inventory to its present
location and condition. Obsolete/ slow moving inventories are
adequately provided for.
iv) Other stores and spares/consumable are valued at cost after
providing for cost of obsolescence, if any.
g) Foreign Exchange Fluctuation
i) Foreign currency transactions during the year are recognized at the
rate of exchange prevailing on the date of transaction. All exchange
differences are dealt with in the Profit and Loss Account except those
relating to acquisition of fixed assets acquired from outside India,
which are adjusted in the cost of the assets. Foreign currency current
assets, current liabilities and loans other than for financing fixed
assets and, outstanding at the year end are translated at the rates of
exchange prevailing at the close of the year and the resultant
gain/losses are recognized in the Profit and Loss Account of the year.
ii) In respect of forward exchange contract entered for speculation
purpose and expired during the year, the difference in forward exchange
booking rate and spot rate on the date of expiry of contract is dealt
in the Profit and Loss Account. In respect of forward exchange contract
entered for speculative purpose and carried forward in next accounting
period, the difference between the forward exchange booking rate and
closing interbank rate including premium upto maturity prevailing at
the close of the year are dealt in the Profit and Loss Account.
iii) In the case of foreign branches, being non-integral foreign
operations, revenue items are converted at the rate prevailing as on
the date of transactions during the year. All assets and liabilities
are converted at rates prevailing at the end of the year. Any exchange
difference arising on conversion is recognized in the foreign
fluctuation translation reserve.
iv) The company has not restated its various foreign currency monetary
assets and liabilities consisting of debtors, creditors and FCCB
deposits at the closing rates of exchange. Accordingly net monetary
gains aggregating to Rs. 78,065,017/- (net of deferred tax Rs.
37,492,702/-) have not been provided in the financial statement.
Additionally, the mark to market profits pertaining to forward
contracts amounting to Rs. 12,422,642/- (net of deferred tax of Rs.
5,966,288/-) have also not been provided in the financial statements.
Accordingly the Net Profit for the year and the net worth as at March
31, 2012 are lower by Rs. 90,487,658/- . The company is of the view
that these favorable foreign exchange fluctuations are temporary in
nature
However, the above is in contravention to Accounting Standard - 11
(Revised) The Effects of Changes in Foreign Exchange Rates issued by
The Institute of Chartered Accountants of India and is also
inconsistent with the accounting policy regularly followed by the
Company.
h) Retirement Benefits
i) Short Term Employee Benefits :
All Employee benefits payable wholly within twelve months of rendering
the service are classified as short term employee benefits and they are
recognized in the period in which employee renders the related service
except leave encashment.
ii) Post - employment Benefits :
Defined. Contribution Plans
Defined contribution fund are government administered provident fund
scheme, employee state insurance scheme for all employees. The Company
s contribution to defined contribution plans are recognized in the
Profit & Loss Account in the financial year to which they relate.
Defined Benefit Gratuity Plan
The Company operates a. defined gratuity plan for all employees with
Life Insurance Corporation of India. The Company s contribution of
premium to gratuity scheme is recognized in the Profit & Loss Account
in the financial year to which they relate.
i) Taxation
i) Current Tax :
Current Tax provision is computed for the current income based on tax
liability after considering allowances and exemptions.
ii) Deferred Tax Provision :
Deferred Tax arising from timing difference between the book profit and
tax profit is accounted for, at the future rate of tax, to the extent
of temporary timing differences that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and
carry forward losses unless there is a virtual certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized.
j) Contingent Liabilities
Contingent liabilities are not provided for in the accounts but are
separately disclosed by way of a note. k) Borrowing Costs:
Borrowing Cost are accounted on accrual basis.
l) Earning Per Share
Earning per share is calculated by dividing the profit attributable to
the Equity Shareholders by the weighted average number of equity share
outstanding during the year.
m) Provisions
Provisions are recognized when the Company has a present obligation as
a result of past events, for which it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation, and a reliable estimate of the amount can be made.
Provisions required to settle are reviewed regularly and are adjusted
where necessary to reflect the current best estimate of the obligation.
Where the Company expects provisions to be reimbursed, is recognized as
a separate asset, only when such reimbursement is virtually certain.
n) Lease Accounting
i) Assets taken on operating lease.
Lease rentals on assets taken on operating lease are recognised as
expense in the Profit and Loss Account on an accrual basis over the
lease term.
ii) Assets given on operating lease.
Lease rentals are accounted on accrual basis in accordance with the
respective lease agreements.
o) Impairment of Assets
At Balance Sheet date, an assessment is done to determine whether there
is any indication of impairment in the carrying amount of the Company s
fixed assets. If any such indication exists, the asset s recoverable
amount is estimated. An impairment loss is recognized whenever the
carrying amount of an asset exceeds its recoverable amount.
Mar 31, 2010
A) Basis of Preparation of Financial Statements :
The fnancial statements have been prepared under the historical cost
convention in accordance with the generally accepted accounting
principles and the provisions of the Companies Act, 1956 as adopted
consistently by the Company. All income & expenditure items having a
material bearing on the fnancial statements are recognized on accrual
basis, except in respect of insurance claims, liquidated damages, where
the exact quantum cannot be ascertained.
B) Income Recognition :
a) Revenue in respect of sale of goods is recognized on dispatch of
goods from the factory on the basis of excise invoice. The sales are
inclusive of excise duty but net of value added tax. Further the
materials returned/rejected are accounted for in the year of
return/rejection.
b) For services rendered the Company recognizes revenue on the basis of
Completed Contract Method.
c) Export incentives & other miscellaneous incomes are recognized on
accrual basis except dividend on investments which are accounted in the
year of receipt.
C) Fixed Assets :
a) Valuation Of Fixed Assets
Fixed Assets are stated at cost of acquisition including any
attributable cost for bringing the assets to its working condition and
exclusive of cenvat credit on capital account. Further in case of
impairment of assets, the fxed assets are carried at cost or
recoverable amount whichever is less.
b) Depreciation
Depreciation on Fixed Assets is provided on straight-line method at the
rates and in the manner prescribed under Schedule XIV of the Companies
Act, 1956.
D) Valuation of Inventories:
a) Raw materials are valued at cost or net realisable value whichever
is lower. Cost is computed using frst in frst out method.
b) Work in progress includes the cost of purchase, appropriate share of
cost of conversion and other overheads incurred in bringing the
inventories to its present location and condition.
c) Finished goods includes cost of purchase, cost of conversion and
other overhead incurred in bringing the inventory to its present
location and condition. Obsolete/ slow moving inventories are
adequately provided for.
d) Other stores and spares/consumable are valued at cost after
providing for cost of obsolescence, if any.
E) Investments:
Long-term investments are valued at cost, less any diminution in value
that is other than temporary. Current investments are valued at lower
of cost and fair value. Income thereon is accounted for as and when
realised.
F) Miscellaneous Expenditure:
Miscellaneous expenditure is written off to the Proft and Loss Account
over a period of up to ten years depending upon the nature and expected
future beneft of such expenditure. However deferred revenue expenditure
comprising of foreign currency convertible bond issue expense is
written off to the Proft and Loss Account over a period of up to fve
years.
G) Foreign exchange transactions:
(a) Foreign currency transactions during the year are recognized at the
rate of exchange prevailing on the date of transaction. All exchange
differences are dealt with in the Proft and Loss Account except those
relating to acquisition of fxed assets acquired from outside India,
which are adjusted in the cost of the assets. Foreign currency current
assets, current liabilities and loans other than for fnancing fxed
assets and, outstanding at the year end are translated at the rates of
exchange prevailing at the close of the year and the resultant
gain/losses are recognized in the Proft and Loss Account of the year.
(b) In respect of forward exchange contract entered for speculation
purpose and expired during the year, the difference in forward exchange
booking rate and spot rate on the date of expiry of contract is dealt
in the Proft and Loss Account. In respect of forward exchange contract
entered for speculative purpose and carried forward in next accounting
period, the difference between the forward exchange booking rate and
closing inter bank rate prevailing at the close of the year are dealt
in the Proft and Loss Account.
(c) In the case of foreign branches, being non-integral foreign
operations, revenue items are converted at the rate prevailing as on
the date of transactions during the year. All assets and liabilities
are converted at rates prevailing at the end of the year. Any exchange
difference arising on conversion is recognized in the foreign
fuctuation translation reserve.
(d) The company has not restated its various foreign currency monetary
assets and liabilities consisting of debtors, creditors and FCCB
deposits at the closing rates of exchange. Accordingly net monetary
gains aggregating to Rs 2039.71 Lakhs (net of deferred tax Rs. 1050.29
Lakhs) have not been provided in the fnancial statement. Additionally,
the mark to market gains pertaining to forward contracts amounting to
Rs 1259.47 Lakhs (net of deferred tax of Rs. 648.52 Lakhs) have also
not been provided in the fnancial statements.
Accordingly the Net Proft for the year and the net worth as at March
31, 2010 are lower by Rs. 4998 Lakhs.
The company is of the view that these favorable foreign exchange
fuctuations are temporary in nature.
However, the above is in contravention to Accounting Standard à 11
(Revised) ÃThe Effects of Changes in Foreign Exchange Ratesà issued by
The Institute of Chartered Accountants of India and is also
inconsistent with the accounting policy regularly followed by the
Company.
H) Retirement Benefts :
i) Short Term Employee Benefts :
All Employee benefts payable wholly within twelve months of rendering
the service are classifed as short term employee benefts and they are
recognized in the period in which employee renders the related service
except Leave Encashment .
ii) Post à employment Benefts :
a) Defned Contribution Plans
Defned contribution fund are government administered provident fund
scheme, employee state insurance scheme for all employees. The
CompanyÃs contribution to defned contribution plans are recognized in
the Proft & Loss Account in the fnancial year to which they relate.
b) Defned Beneft Gratuity Plan
The Company operates a defned gratuity plan for all employees with Life
Insurance Corporation of India. The CompanyÃs contribution of premium
to gratuity scheme is recognized in the Proft & Loss Account in the
fnancial year to which they relate.
I) Taxation :
a) Current Tax :
Current Tax provision is computed for the current income based on tax
liability after considering allowances and exemptions.
b) Deferred Tax Provision :
Deferred Tax arising from timing difference between the book proft and
tax proft is accounted for, at the future rate of tax, to the extent of
temporary timing differences that originate in one period and are
capable of reversal in one or more subsequent periods.
Deferred Tax Assets are not recognized on unabsorbed depreciation and
carry forward losses unless there is a virtual certainty that suffcient
future taxable income will be available against which such deferred tax
assets can be realised.
J) Contingent Liabilities:
Contingent liabilities are not provided for in the accounts but are
separately disclosed by way of a note.
K) Borrowing Costs:
Borrowing Costs are accounted on accrual basis.
L) Earning Per Share:
Earning per share is calculated by dividing the proft attributable to
the Equity Shareholders by the weighted average number of equity share
outstanding during the year.
M) Lease Accounting
Assets taken on operating lease:
Lease rentals on assets taken on operating lease are recognised as
expense in the Proft and Loss Account on an accrual
basis over the lease term.
Assets given on operating lease:
The Company has provided tinting systems to dealers on an operating
lease basis. Lease rentals are accounted on accrual
basis in accordance with the respective lease agreements.
N) Provisions:
Provisions are recognized when the Company has a present obligation as
a result of past events, for which it is probable that an outfow of
resources embodying economic benefts will be required to settle the
obligation, and a reliable estimate of the amount can be made.
Provisions required to settle are reviewed regularly and are adjusted
where necessary to refect the current best estimate of the obligation.
Where the Company expects provisions to be reimbursed, is recognized as
a separate asset, only when such reimbursement is virtually certain.
O) Impairment of Assets:
At Balance Sheet date, an assessment is done to determine whether there
is any indication of impairment in the carrying amount of the CompanyÃs
fxed assets. If any such indication exists, the assetÃs recoverable
amount is estimated. An impairment loss is recognized whenever the
carrying amount of an asset exceeds its recoverable amount.
An assessment is also done at each Balance Sheet date whether there is
any indication that an impairment loss recognized for an asset in prior
accounting period may no longer exists or may have decreased. If any
indication exists the assets recoverable amount is estimated. The
carrying amount is increased to revised estimate of its recoverable
amount but so that the increased carrying amount does not exceeds the
carrying amount that would have been determined had no impairment loss
been recognized for the asset in the prior years. A reversal of
impairment loss is recognized in the Proft & Loss Account.
After recognition of impairment loss or reversal of impairment loss as
applicable, the depreciation charge for the assets is adjusted in
future periods to allocate the assetÃs revised carrying amount, less
its residual value (if any), on straight line basis over its remaining
useful life.