Mar 31, 2014
A. Basis of preparation of Financial Statements :
The financial statements have been prepared under historical cost
convention on the accrual basis of accounting in accordance with the
accounting principles generally accepted in India (GAAP) and in
compliance with the Accounting Standards issued by The Institute of
Chartered Accountants of India and the provisions of the Companies Act,
1956 as adopted consistently by the company.
Accounting policies not specifically referred to otherwise are
consistent with the generally accepted accounting principles followed
by the Company.
The preparation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made, that affect the reported amounts of assets and
liabilities on the date of financial statements and the reported
amounts of revenues and expenses during the reported year. Differences
between the actual results and estimates are recognized in the year in
which the results are known / materialized.
b. Revenue recognition:
Revenue from sales in respect of hardware is recognized when they are
completed with passing of the title and are exclusive of sales tax,
octroi and other incidental expenses.
Revenue from software development is recognized in accordance with the
percentage of completion method and revenue from sale of licenses of
software products and other products is recognized on delivery /
installation, as the case may be.
Revenue from IT infrastructure networking, annual service contracts and
facilities management services is deferred and recognized ratably over
the period of the underlying maintenance agreement.
Interest Income is recognized on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend Income is recognized when the shareholders'' right to receive
payment is established by the Balance Sheet Date.
c. ExuendKure:
Expenses are accounted on accrual basis and the provisions are made for
all known losses and liabilities. No provisions are made towards likely
expenses on providing post-sales client support for fixed priced
contracts as well as in respect of annual technical service contracts
in so far as it pertains to the period beyond the current accounting
year.
d. Fixed Assets and Depreciation :
A. Fixed Assets
Fixed assets are stated at their original cost of acquisition including
incidental expenses related to acquisition & installation of the
concerned assets less accumulated depreciation and impairment losses,
if any,.
Costs that are directly associated with identifiable and unique
software products controlled by the Company, whether developed in-house
or acquired, and have probable economic benefits exceeding the cost are
recognized as product development.
Assets acquired under lease are at cost of acquisition including
incidental expenses related to acquisition & installation of such
assets.
Advances paid towards acquisition of fixed assets and the cost of
assets not ready for use as at the Balance Sheet date are disclosed
under capital work-in-progress.
B. Depreciation /Amortization.
Depreciation on Software and Computer Systems is provided based on
Management''s estimate of useful life of Software/System however subject
to maximum period of 6 years. Depreciation on Fixed Assets other than
Land and those mentioned above has been provided on Straight Line
Method at the following rates:
Product Development Expenses capitalized are amortized over its useful
life for a period not exceeding ten years. ,
Leasehold assets are amortized over the period of lease.
Miscellaneous expenditure is amortized over a period of 5 years
from the year in which it has been incurred,
e. Impairment of Assets:
Fixed assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Whenever the carrying amount of an asset exceeds its
recoverable amount, an impairment loss is recognized in the income
statement for items of fixed assets carried at cost. The recoverable
amount is higher of an assets net selling price and value in use. The
net selling price is the amount obtained from the sale of an asset in
an arm''s length transaction while value in use is the present value of
estimated future cash flows expected to arise from the continuing use
of an asset, from its disposal at the end of its useful life.
Investments are classified into current investment and iong term
investments. Current investments are stated at iower of cost or fair
market vaiue. Long Term investments are stated at cost less provision
for permanent diminution in vaiue if any, of investments.
h. Foreign Exchange Transactions:
Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transaction. Realized
gains and losses on settlement of foreign currency transactions are
recognized in the Profit and Loss account. Foreign currency assets and
liabilities at the year end are translated at the year end exchange
rates and the resultant exchange difference is recognized in the Profit
and Loss Account. Exchange differences relating to fixed assets are
adjusted in the cost of the respective assets.
i. Research & Development:
1. Revenue expenditure on R&D is charged of to profit & loss account in
the year in which it is incurred where the Company is not certain of
realizing future economic benefits from such activities.
2. Capital expenditure on R&D is included under the relevant fixed
assets.
j. Employee Benefits:
(a) Short Term Employee Benefits
All short term employee benefits such as salaries, wages, bonus,
medical benefits which fall due within 12 months of the period in which
the employee renders the related services are charged to the profit and
loss account.
(b) Long Term & Post- Employment Benefits
(i) Defined Contribution Plan
Company''s contribution paid/payable during the year towards Provident
Fund Scheme, ESIC is recognized in the Profit & Loss Account.
(il) Defined Benefit Plan
The Company''s Gratuity Benefit Scheme is a defined benefit plan. The
Company''s liability for gratuity is determined by actuarial valuation
made at the end of each financial year using the projected unit credit
method. Actuarial gains and Losses are immediately recognized in Profit
& Loss Account as income and expense.
k. Borrowing Costs:
Borrowing costs directly attributable to acquisition, construction and
production of qualifying assets are capitalized as a part of the cost
of such asset up to the date of completion. Other borrowing costs are
charged to the Profit & Loss Account.
I. Deferred tax:
Deferred Income taxes reflects the impact of current year timing
differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years. The differences
that result between the profit considered for income taxes and the
profit as per the financial statements are identified, and thereafter a
deferred tax asset or deferred tax liability is recorded for timing
differences, namely the differences that originate in one accounting
period and reverse in another, based on the tax effect of the aggregate
amount being considered. The tax effect is calculated on the
accumulated timing differences at the end of an accounting period based
on prevailing enacted or substantially enacted regulations. Deferred
tax assets are recognized only if there is reasonable certainty of
their realization and are reviewed for the appropriateness of their
respective carrying values at each balance sheet date.
m. Provision for Tax:
Provision for current tax is determined on the basis of estimated
taxable income for the period as per the provisions of Section 115JB
Income Tax Act, 1961.
n. Earnings per Share (EPS):
The earnings considered in ascertaining the Company''s EPS are computed
as per Accounting Standard 20 on "Earning per Share", issued by the
Institute of Chartered Accountants of India. The number of shares used
in computing basic EPS is the weighted average number of shares
outstanding during the period. The diluted EPS is calculated on the
same basis as basic EPS, after adjusting for the effects of potential
dilutive equity shares unless the effect of the potential dilutive
equity shares is anti-dilutive.
o. Provision and Contingent Liabilities
Provisions are recognized and computed in accordance with Accounting
Standard 29 on "Provisions, Contingent Liabilities and Contingent
Assets" issued by the Institute of Chartered Accountants of India i.e.
they are recognized if the following conditions are satisfied:
(a) The Company has a present obligation as a result of past event;
(b) It is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation; and
(c) A reliable estimate can be made of the amount of the obligation.
Similarly, the Contingent liabilities are disclosed in Accordance with
the Accounting Standard 29 i.e. they are disclosed when the Company has
a possible obligation or a present obligation and it is probable that a
Cash Outflow will not be required to settle the obligation.
j>. Leases
Lease arrangements where the risks and rewards incident to ownership of
an asset substantially vest with the lessor, are recognised as
operating leases. Lease rentals under operating leases are recognised
in the profit and loss account on a straight-line basis over the period
of lease.
Mar 31, 2012
A. Basis of preparation of Financial Statements
i. The financial statements have been prepared under historical cost
convention on the accrual basis of accounting in accordance with the
accounting principles generally accepted in India (GAAP) and in
compliance with the Accounting Standards issued by The Institute of
Chartered Accountants of India and the provisions of the Companies Act,
1956 as adopted consistently by the company.
ii. Accounting policies not specifically referred to otherwise are
consistent with the generally accepted accounting principles followed
by the Company.
iii. The preparation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made, that affect the reported amounts of assets and
liabilities on the date of financial statements and the reported
amounts of revenues and expenses during the reported year. Differences
between the actual results and estimates are recognized in the year in
which the results are known / materialized.
b. Revenue recognition
i. Revenue from sales in respect of hardware is recognized when they
are completed with passing of the title and are exclusive of sales tax,
octroi and other incidental expenses.
ii. Revenue from software development is recognized in accordance with
the percentage of completion method and revenue from sale of licenses
of software products and other products is recognized on delivery /
installation, as the case may be.
iii. Revenue from IT infrastructure networking, annual service
contracts and facilities management services is deferred and recognized
ratably over the period of the underlying maintenance agreement.
iv. Interest Income is recognized on a time proportion basis taking
into account the amount outstanding and the rate applicable.
v. Dividend Income is recognized when the shareholders' right to
receive payment is established by the Balance Sheet Date.
c. Expenditure
Expenses are accounted on accrual basis and the provisions are made for
all known losses and liabilities. No provisions are made towards likely
expenses on providing post-sales client support for fixed priced
contracts as well as in respect of annual technical service contracts
in so far as it pertains to the period beyond the current accounting
year.
d. Fixed Assets and Depreciation
A. Fixed Assets
a) Fixed assets are stated at their original cost of acquisition
including incidental expenses related to acquisition & installation of
the concerned assets less accumulated depreciation and impairment
losses, if any,.
b) Costs that are directly associated with identifiable and unique
software products controlled by the Company, whether developed in-house
or acquired, and have probable economic benefits exceeding the cost are
recognized as product development.
c) Assets acquired under lease are at cost of acquisition including
incidental expenses related to acquisition & installation of such
assets.
d) Advances paid towards acquisition of fixed assets and the cost of
assets not ready for use as at the Balance Sheet date are disclosed
under capital work-in-progress.
B. Depreciation /Amortization
a) Depreciation on Software and Computer Systems is provided based on
Management's estimate of useful life of Software/System however subject
to maximum period of 6 years. Depreciation on Fixed Assets other than
Land and those mentioned above has been provided on Straight Line
Method at the following rates:
Asset Group Rates (SLM)
Furniture & Fixtures 6.33%
Vehicles 9.50%
Office Equipments 4.75%
Office Premises 1.63%
b) Product Development Expenses capitalized are amortized over its
useful life for a period not exceeding ten years.
c) Leasehold assets are amortized over the period of lease.
d) Miscellaneous expenditure is amortized over a period of 5 years from
the year in which it has been incurred.
e. Impairment of Assets
Fixed assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Whenever the carrying amount of an asset exceeds its
recoverable amount, an impairment loss is recognized in the income
statement for items of fixed assets carried at cost. The recoverable
amount is higher of an assets net selling price and value in use. The
net selling price is the amount obtained from the sale of an asset in
an arm's length transaction while value in use is the present value of
estimated future cash flows expected to arise from the continuing use
of an asset, from its disposal at the end of its useful life.
f. Inventories
Inventories have been valued on the following basis:
i). Raw Materials, - At cost. packing material, stores and spares
ii). Work-in-progress - At cost plus appropriate allocation of
overheads. iii). Finished Goods - At cost plus appropriate allocation
of overheads or net realizable value, which- ever is lower
g. Investments
Investments are classified into current investment and long term
investments. Current investments are stated at lower of cost or fair
market value. Long Term Investments are stated at cost less provision
for permanent diminution in value if any, of investments.
h. Foreign Exchange Transactions
Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transaction. Realized
gains and losses on settlement of foreign currency transactions are
recognized in the Profit and Loss account. Foreign currency assets and
liabilities at the year end are translated at the year end exchange
rates and the resultant exchange difference is recognized in the Profit
and Loss Account. Exchange differences relating to fixed assets are
adjusted in the cost of the respective assets.
i. Research & Development
A. Revenue expenditure on R&D is charged of to profit & loss account
in the year in which it is incurred where the Company is not certain of
realizing future economic benefits from such activities.
B. Capital expenditure on R&D is included under the relevant fixed
assets.
j. Employee Benefts
(a) Short Term Employee Benefts
All short term employee benefits such as salaries, wages, bonus,
medical benefits which fall due within 12 months of the period in which
the employee renders the related services are charged to the profit and
loss account.
(b) Long Term & Post- Employment Benefts
(i) Defined Contribution Plan
Company's contribution paid/payable during the year towards Provident
Fund Scheme, ESIC is recognized in the Profit & Loss Account.
(ii) Defined Benefit Plan
The Company's Gratuity Benefit Scheme is a defined benefit plan. The
Company's liability for gratuity is determined by actuarial valuation
made at the end of each financial year using the projected unit credit
method. Actuarial gains and Losses are immediately recognized in Profit
& Loss Account as income and expense.
k. Borrowing Costs
Borrowing costs directly attributable to acquisition, construction and
production of qualifying assets are capitalized as a part of the cost
of such asset up to the date of completion. Other borrowing costs are
charged to the Profit & Loss Account.
l. Deferred tax
Deferred Income taxes reflects the impact of current year timing
differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years. The differences
that result between the profit considered for income taxes and the
profit as per the financial statements are identified, and thereafter a
deferred tax asset or deferred tax liability is recorded for timing
differences, namely the differences that originate in one accounting
period and reverse in another, based on the tax effect of the aggregate
amount being considered. The tax effect is calculated on the
accumulated timing differences at the end of an accounting period based
on prevailing enacted or substantially enacted regulations. Deferred
tax assets are recognized only if there is reasonable certainty of
their realization and are reviewed for the appropriateness of their
respective carrying values at each balance sheet date.
m. Provision for Tax
Provision for current tax is determined on the basis of estimated
taxable income for the period as per the provisions of Section 115JB
Income Tax Act, 1961.
n. Earnings per Share (EPS)
The earnings considered in ascertaining the Company's EPS are computed
as per Accounting Standard 20 on "Earning per Share", issued by the
Institute of Chartered Accountants of India. The number of shares used
in computing basic EPS is the weighted average number of shares
outstanding during the period. The diluted EPS is calculated on the
same basis as basic EPS, after adjusting for the effects of potential
dilutive equity shares unless the effect of the potential dilutive
equity shares is anti-dilutive.
o. Provision and Contingent Liabilities
Provisions are recognized and computed in accordance with Accounting
Standard 29 on "Provisions, Contingent Liabilities and Contingent
Assets" issued by the Institute of Chartered Accountants of India i.e.
they are recognized if the following conditions are satisfied:
(a) The Company has a present obligation as a result of past event;
(b) It is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation; and
(c) A reliable estimate can be made of the amount of the obligation.
Similarly, the Contingent liabilities are disclosed in Accordance with
the Accounting Standard 29 i.e. they are disclosed when the Company
has a possible obligation or a present obligation and it is probable
that a Cash Outflow will not be required to settle the obligation
p. Leases
Lease arrangements where the risks and rewards incident to ownership of
an asset substantially vest with the lessor, are recognised as
operating leases. Lease rentals under operating leases are recognised
in the profit and loss account on a straight-line basis over the period
of lease.
Mar 31, 2011
1. Basis of preparation of Financial Statements :
i. The financial statements have been prepared under historical cost
convention on the accrual basis of accounting in accordance with the
accounting principles generally accepted in India (GAAP) and in
compliance with the Accounting Standards issued by The Institute of
Chartered Accountants of India and the provisions of the Companies Act,
1956 as adopted consistently by the company.
ii. Accounting policies not specifically referred to otherwise are
consistent with the generally accepted accounting principles followed
by the Company.
iii. The preparation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made, that affect the reported amounts of assets and
liabilities on the date of financial statements and the reported
amounts of revenues and expenses during the reported year. Differences
between the actual results and estimates are recognized in the year in
which the results are known / materialized.
2. Revenue recognition :
A. Revenue from sales in respect of hardware is recognized when they
are completed with passing of the title and are exclusive of sales tax,
octroi and other incidental expenses.
B. Revenue from software development is recognized in accordance with
the percentage of completion method and revenue from sale of licenses
of software products and other products is recognized on delivery /
installation, as the case may be.
C. Revenue from IT infrastructure networking, annual service contracts
and facilities management services is deferred and recognized ratably
over the period of the underlying maintenance agreement.
D. Interest Income is recognized on a time proportion basis taking
into account the amount outstanding and the rate applicable.
E. Dividend Income is recognized when the shareholders' right to
receive payment is established by the Balance Sheet Date.
3. Expenditure :
Expenses are accounted on accrual basis and the provisions are made for
all known losses and liabilities. No provisions are made towards likely
expenses on providing post-sales client support for fixed priced
contracts as well as in respect of annual technical service contracts
in so far as it pertains to the period beyond the current accounting
year.
4. Fixed Assets and Depreciation : A. Fixed Assets
a) Fixed assets are stated at their original cost of acquisition
including incidental expenses related to acquisition & installation of
the concerned assets less accumulated depreciation and impairment
losses, if any.
b) Costs that are directly associated with identifiable and unique
software products controlled by the Company, whether developed in-house
or acquired, and have probable economic benefits exceeding the cost are
recognized as product development.
c) Assets acquired under lease are at cost of acquisition including
incidental expenses related to acquisition & installation of such
assets.
d) Advances paid towards acquisition of fixed assets and the cost of
assets not ready for use as at the Balance Sheet date are disclosed
under capital work-in-progress.
b) Product Development Expenses capitalized are amortized over its
useful life for a period not exceeding ten years.
c) Leasehold assets are amortized over the period of lease.
d) Miscellaneous expenditure is amortized over a period of 5 years from
the year in which it has been incurred.
5. Impairment of Assets:
Fixed assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Whenever the carrying amount of an asset exceeds its
recoverable amount, an impairment loss is recognized in the income
statement for items of fixed assets carried at cost. The recoverable
amount is higher of an assets net selling price and value in use. The
net selling price is the amount obtained from the sale of an asset in
an arm's length transaction while value in use is the present value of
estimated future cash flows expected to arise from the continuing use
of an asset, from its disposal at the end of its useful life.
6. Inventories :
Inventories have been valued on the following basis:
i) Raw Materials, packing material, stores and spares - At cost
ii) Work-in-progress - At cost plus appropriate allocation of overheads
iii) Finished Goods - At cost plus appropriate allocation of overheads
or net
realizable value, whichever is lower
7. Investments :
Investments are classified into current investment and long term
investments. Current investments are stated at lower of cost or fair
market value. Long Term Investments are stated at cost less provision
for permanent diminution in value if any, of investments.
8. Foreign Exchange Transactions :
Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transaction. Realized
gains and losses on settlement of foreign currency transactions are
recognized in the Profit and Loss account. Foreign currency assets and
liabilities at the year end are translated at the year end exchange
rates and the resultant exchange difference is recognized in the Profit
and Loss Account. Exchange differences relating to fixed assets are
adjusted in the cost of the respective assets.
9. Research & Development :
A. Revenue expenditure on R&D is charged to profit & loss account in
the year in which it is incurred where the Company is not certain of
realizing future economic benefits from such activities.
B. Capital expenditure on R&D is included under the relevant fixed
assets.
10. Employee Benefits:
(a) Short Term Employee Benefits
All short term employee benefits such as salaries, wages, bonus,
medical benefits which fall due within 12 months of the period in which
the employee renders the related services are charged to the profit and
loss account.
(b) Long Term & Post- Employment Benefits
(i) Defined Contribution Plan
Company's contribution paid/payable during the year towards Provident
Fund Scheme, ESIC is recognized in the Profit & Loss Account.
(ii) Defined Benefit Plan
The Company's Gratuity Benefit Scheme is a defined benefit plan. The
Company's liability for gratuity is determined by actuarial valuation
made at the end of each financial year using the projected unit credit
method. Actuarial gains and Losses are immediately recognized in
Profit & Loss Account as income and expense.
11. Borrowing Costs :
Borrowing costs directly attributable to acquisition, construction and
production of qualifying assets are capitalized as a part of the cost
of such asset up to the date of completion. Other borrowing costs are
charged to the Profit & Loss Account.
12. Deferred tax :
Deferred Income taxes reflects the impact of current year timing
differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years. The differences
that result between the profit considered for income taxes and the
profit as per the financial statements are identified, and thereafter a
deferred tax asset or deferred tax liability is recorded for timing
differences, namely the differences that originate in one accounting
period and reverse in another, based on the tax effect of the aggregate
amount being considered. The tax effect is calculated on the
accumulated timing differences at the end of an accounting period based
on prevailing enacted or substantially enacted regulations. Deferred
tax assets are recognized only if there is reasonable certainty of
their realization and are reviewed for the appropriateness of their
respective carrying values at each balance sheet date.
13. Provision for Tax:
Provision for current tax is determined on the basis of estimated
taxable income for the period as per the provisions of Section 115JB
Income Tax Act, 1961.
14. Earnings per Share (EPS) :
The earnings considered in ascertaining the Company's EPS are computed
as per Accounting Standard 20 on "Earning per Share", issued by the
Institute of Chartered Accountants of India. The number of shares used
in computing basic EPS is the weighted average number of shares
outstanding during the period. The diluted EPS is calculated on the
same basis as basic EPS, after adjusting for the effects of potential
dilutive equity shares unless the effect of the potential dilutive
equity shares is anti-dilutive.
15. Provision and Contingent Liabilities
Provisions are recognized and computed in accordance with Accounting
Standard 29 on "Provisions, Contingent Liabilities and Contingent
Assets" issued by the Institute of Chartered Accountants of India i.e.
they are recognized if the following conditions are satisfied:
(a) The Company has a present obligation as a result of past event;
(b) It is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation; and
(c) A reliable estimate can be made of the amount of the obligation.
Similarly, the Contingent liabilities are disclosed in Accordance with
the Accounting Standard 29 i.e. they are disclosed when the Company has
a possible obligation or a present obligation and it is probable that a
Cash Outflow will not be required to settle the obligation.
16. Leases
Lease arrangements where the risks and rewards incident to ownership of
an asset substantially vest with the lessor, are recognised as
operating leases. Lease rentals under operating leases are recognised
in the profit and loss account on a straight-line basis over the period
of lease.
Mar 31, 2010
1. Basis of preparation of Financial Statements :
i. The financial statements have been prepared under historical cost
convention on the accrual basis of accounting in accordance with the
accounting principles generally accepted in India (GAAP) and in
compliance with the Accounting Standards issued by The Institute of
Chartered Accountants of India and the provisions of the Companies act,
1956 as adopted consistently by the company.
ii. Accounting policies not specifically referred to otherwise are
consistent with the generally accepted accounting principles followed
by the Company.
iii. The preparation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made, that affect the reported amounts of assets and
liabilities on the date of financial statements and the reported
amounts of revenues and expenses during the reported year. Differences
between the actual results and estimates are recognized in the year in
which the results are known / materialized.
2. Revenue Recognition :
i. Revenue from sales in respect of hardware is recognized when they
are completed with passing of the title and are exclusive of sales tax,
octroi and other incidental expenses.
ii. Revenue from software development is recognized in accordance with
the percentage of completion method and revenue from sale of licenses
of software products and other products is recognized on delivery /
installation, as the case may be.
iii. Revenue from IT infrastructure networking, annual service
contracts and facilities management services is deferred and recognized
ratably over the period of the underlying maintenance agreement.
iv. Interest Income is recognized on a time proportion basis taking
into account the amount outstanding and the rate applicable.
v. Dividend Income is recognized when the shareholders right to
receive payment is established by the Balance Sheet Date.
3. Expenditure :
Expenses are accounted on accrual basis and the provisions are made for
all known losses and liabilities. No provisions are made towards likely
expenses on providing post-sales client support for fixed priced
contracts as well as in respect of annual technical service contracts
in so far as it pertains to the period beyond the current accounting
year.
4. Fixed Assets and Depreciation : i. Fixed Assets
a) Fixed assets are stated at their original cost of acquisition
including incidental expenses related to acquisition & installation of
the concerned assets less accumulated depreciation and impairment
losses, if any.
b) Costs that are directly associated with identifiable and unique
software products controlled by the Company, whether developed in-house
or acquired, and have probable economic benefits exceeding the cost are
recognized as product development.
c) Assets acquired under lease are at cost of acquisition including
incidental expenses related to acquisition & installation of such
assets.
d) Advances paid towards acquisition of fixed assets and the cost of
assets not ready for use as at the Balance Sheet date are disclosed
under capital work-in-progress.
ii. Depreciation /Amortization.
a) Depreciation on Software and Computer Systems is provided based on
Managements estimate of useful life of Software/System however subject
to maximum period of 6 years. Depreciation on Fixed Assets other than
Land and those mentioned above has been provided on Straight Line
Method at the following rates:
b) Product Development Expenses capitalized are amortized over its
useful life for a period not exceeding ten years
c) Leasehold assets are amortized over the period of lease.
d) Miscellaneous expenditure is amortized over a period of 5 years from
the year in which it has been incurred.
5. Impairment of Assets:
Fixed assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Whenever the carrying amount of an asset exceeds its
recoverable amount, an impairment loss is recognized in the income
statement for items of fixed assets carried at cost. The recoverable
amount is higher of an assets net selling price and value in use. The
net selling price is the amount obtained from the sale of an asset in
an arms length transaction while value in use is the present value of
estimated future cash flows expected to arise from the continuing use
of an asset, from its disposal at the end of its useful life.
6. Inventories:
Inventories have been valued on the following basis:
i). Raw Materials, packing material, stores and spares - At cost.
ii). Work-in-progress - At cost plus appropriate allocation of
overheads.
iii). Finished Goods - At cost plus appropriate allocation of
overheads
or net realizable value, whichever is lower
7. Investments :
Investments are classified into current investment and long term
investments. Current investments are stated at lower of cost or fair
market value. Long Term Investments are stated at cost less provision
for permanent diminution in value if any, of investments.
8. Foreign Exchange Transactions :
Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transaction. Realized
gains and losses on settlement of foreign currency transactions are
recognized in the Profit and Loss account. Foreign currency assets and
liabilities at the year end are translated at the year end exchange
rates and the resultant exchange difference is recognized in the Profit
and Loss Account. Exchange differences relating to fixed assets are
adjusted in the cost of the respective assets.
9. Research & Development :
i. Revenue expenditure on R&D is charged to profit & loss account in
the year in which it is incurred where the Company is not certain of
realizing future economic benefits from such activities.
ii. Capital expenditure on R&D is included under the relevant fixed
assets.
10. Employee Benefits:
i. Short Term Employee Benefits
All short term employee benefits such as salaries, wages, bonus,
medical benefits which fall due within 12 months of the period in which
the employee renders the related services are charged to the profit and
loss account.
ii. Long Term & Post- Employment Benefits
(a) Defined Contribution Plan
Companys contribution paid/payable during the year towards Provident
Fund Scheme, ESIC is recognized in the Profit & Loss Account.
(b) Defined Benefit Plan
The Companys Gratuity Benefit Scheme is a defined benefit plan. The
Companys liability for gratuity is determined by actuarial valuation
made at the end of each financial year using the projected unit credit
method. Actuarial gains and Losses are immediately recognized in Profit
& Loss Account as income and expense.
11. Borrowing Costs :
Borrowing costs directly attributable to acquisition, construction and
production of qualifying assets are capitalized as a part of the cost
of such asset up to the date of completion. Other borrowing costs are
charged to the Profit & Loss Account.
12. Deferred tax :
Deferred Income taxes reflects the impact of current year timing
differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years. The differences
that result between the profit considered for income taxes and the
profit as per the financial statements are identified, and thereafter a
deferred tax asset or deferred tax liability is recorded for timing
differences, namely the differences that originate in one accounting
period and reverse in another, based on the tax effect of the aggregate
amount being considered. The tax effect is calculated on the
accumulated timing differences at the end of an accounting period based
on prevailing enacted or substantially enacted regulations. Deferred
tax assets are recognized only if there is reasonable certainty of
their realization and are reviewed for the appropriateness of their
respective carrying values at each balance sheet date.
13. Provision for Tax:
Provision for current tax is determined on the basis of estimated
taxable income for the period as per the provisions of Section 115JB
Income Tax Act, 1961.
14. Earnings per Share (EPS) :
The earnings considered in ascertaining the Companys EPS are computed
as per Accounting Standard 20 on ÃEarning per ShareÃ, issued by the
Institute of Chartered Accountants of India. The number of shares used
in computing basic EPS is the weighted average number of shares
outstanding during the period. The diluted EPS is calculated on the
same basis as basic EPS, after adjusting for the effects of potential
dilutive equity shares unless the effect of the potential dilutive
equity shares is anti-dilutive.
15. Provision and Contingent Liabilities
Provisions are recognized and computed in accordance with Accounting
Standard 29 on ÃProvisions, Contingent Liabilities and Contingent
Assetsà issued by the Institute of Chartered Accountants of India i.e.
they are recognized if the following conditions are satisfied:
i. The Company has a present obligation as a result of past event;
ii. It is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation; and
iii. A reliable estimate can be made of the amount of the obligation.
Similarly, the Contingent liabilities are disclosed in Accordance with
the Accounting Standard 29 i.e. they are disclosed when the Company has
a possible obligation or a present obligation and it is probable that a
Cash Outflow will not be required to settle the obligation
16. Leases
Lease arrangements where the risks and rewards incident to ownership of
an asset substantially vest with the lessor, are recognised as
operating leases. Lease rentals under operating leases are recognised
in the profit and loss account on a straight-line basis over the period
of lease.
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