Mar 31, 2015
A) Basis of preparation
The financial statements are prepared under the historical cost
convention on accrual basis of accounting to comply with the Accounting
Standards specified under Section 133 of the Companies Act, 2013 read
with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant
provisions thereof.
b) Fixed Assets
Fixed assets are stated at cost (net of CENVAT wherever applicable)
less accumulated depreciation. Cost is inclusive of freight, duties and
levies and any directly attributable cost of bringing the assets to
their working conditions for intended use but excludes recoveries.
Intangibles are stated at cost less accumulated amount of amortization.
c) Depreciation/Amortization
Tangible Assets
i. W.e.f 1-4-2014 Depreciation on fixed assets is provided on Straight
Line Method (SLM) as per useful life & in the manner prescribed in
Schedule II of the Companies Act, 2013.
ii. Depreciation on building other than above is calculated on the
revalued amount at the rates considered appropriate by the Value. Out
of the above, depreciation on original cost on straight line method
basis as prescribed by the Companies Act, 2013 is charged to Profit &
Loss Account and balance for the year is set off against transfer from
Revaluation Reserve.
iii. Leasehold land is depreciated over the period of lease.
Intangible Assets
Computer Software charges are amortized over a period of five years.
d) Inventories
Inventories are valued at lower of cost or net realizable value.
i) Cost of Raw Materials, Stores, Spares etc. is determined on first in
first out basis but excludes sales tax on such purchases within Haryana
which is set off against the Sales tax liability on goods produced from
such purchases and sold during the year. Excise duty is not included in
cost as the Cenvat benefit goes to reduce the cost of materials
purchased.
ii) The cost of finished goods and work in progress includes cost of
raw material and factory overheads. Provision of excise duty on
finished goods is made in accounts and is also considered to determine
the cost of stock of finished goods.
e) Investments
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long term investments. Current
investments are carried at the lower of cost or fair value. Long term
investments are carried at cost less permanent diminution in value, if
any.
f) Revenue Recognition
Sales are recognized on transfer of significant risks & rewards which
takes place on dispatch of goods to the customer. Sales are stated net
of excise duty; excise duty being the amount included in the amount of
gross turnover. Sales exclude VAT/Sales tax and are net of returns and
transit insurance claims short received.
Earnings from investments, are accrued or taken into revenue in full on
declaration or receipts. Profit/loss on sale of raw materials and
stores stand adjusted in their consumption account.
g) Borrowing Costs
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalized as part of the cost
of such assets. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use
or sale. All other borrowing costs are charged to revenue.
h) Employee Benefits
Contributions to defined Contribution Schemes such as Provident Fund
etc are charged to the Statement of Profit & Loss as and when incurred.
The Gratuity Fund benefits are administered by a Trust recognized by
Income Tax Authorities through the Group Scheme of LIC of India. The
liability for gratuity at the end of each financial year is determined
on the basis of actuarial valuation carried out by the Insurer's
Actuary on the basis of projected unit credit method as confirmed to
the Company. Company's contribution is charged to the Statement of
Profit and Loss.
Liability on account of employee benefits comprising of compensated
absences is determined on the basis of actuarial valuation carried out
by the Insurer's actuary at the end of financial year which is paid to
the LIC of India and Canara Bank, HSBC, Oriental Bank of Commerce Life
Insurance Company Ltd. Company's contribution is charged to Statement
of Profit and Loss.
Liability on account of bonus and other incentives is recognised on an
undiscounted accrual basis.
i) Foreign Exchange Transactions
Monetary assets and liabilities denominated in foreign currency are
restated at the prevailing year and rates. The resultant gain/ loss
upon such restatement along with the gain /loss on account of foreign
currency transactions are accounted in the Statement of Profit and
Loss.
j) Taxation
Current tax is determined as the amount of tax payable in respect of
taxable income in accordance with relevant tax rates and tax laws.
Deferred tax is recognized, subject to the consideration of prudence,
on timing differences, being the difference between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods.
k) Impairment of Assets
Regular review is done to determine whether there is any indication of
impairment of the carrying amount of the Company's fixed assets. If any
such indication exists, impairment loss i.e. the amount by which the
carrying amount of an asset exceeds its recoverable amount is provided
in the books of accounts. In case there is any indication that an
impairment loss recognized for an asset in prior accounting periods no
longer exists or may have decreased, the recoverable value is
reassessed and the reversal of impairment loss is recognized as income
in the Statement of Profit and Loss.
l). Provisions and Contingencies
A provision is recognized when the Company has a present obligation as
a result of a past event and it is probable that an outflow of
resources would be required to settle the obligation, and in respect of
which a reliable estimate can be made.
Provisions are reviewed at each balance sheet date and are adjusted to
effect the current best estimation.
A disclosure of contingent liability is made when there is a possible
obligation or a present obligation that will probably not require
outflow of resources or where a reliable estimate of the obligation
cannot be made.
Mar 31, 2014
A) BASIS FOR PREPARATION OF ACCOUNTS
The financial statements have been prepared in compliance with all
material aspects with the Accounting Standards notified by Companies
(Accounting Standards) Rules, 2006, as amended and the other relevant
provisions of Companies Act, 1956, read with General Circular
No.15/2013 dated 13 th September, 2013, issued by the Ministry of
Corporate Affairs, in respect of Section 133 of Companies Act, 2013.
Financial statements are based on historical cost and are prepared on
accrual basis. Accounting policies have been consistently applied by
the Company and are consistent with those used in the previous year.
All assets and liabilities have been classified as current or non
current as per the Company''s normal operating cycle and the criteria
set out in Revised Schedule VI to the Companies Act, 1956. The Company
has ascertained its operating cycle as 12 months for the purpose of
current/non current classification of assets and liabilities.
b) FIXED ASSETS
Fixed assets are stated at cost (net of CENVAT wherever applicable)
less accumulated depreciation. Cost is inclusive of freight, duties
and levies and any directly attributable cost of bringing the assets to
their working conditions for intended use but excludes recoveries.
Intangibles are stated at cost less accumulated amount of amortisation.
c) DEPRECIATION/AMORTISATION Tangible Assets
i) Depreciation on fixed assets is provided on straight line method
(SLM) at the rates and in the manner prescribed in Schedule-XIV of the
Companies Act, 1956 except straight line rate on Dies & Moulds at 95%
per annum which is higher than the rate prescribed in the above
schedule. The rate of depreciation on dies & moulds reflect the
estimated useful life of such assets.
ii) Depreciation on building other than above is calculated on the
revalued amount at the rates considered appropriate by the Valuer. Out
of the above, depreciation on original cost on straight line method
basis as prescribed by the Companies Act, 1956 (as amended) is charged
to Profit & Loss Account and balance for the year is set off against
transfer from Revaluation Reserve.
iii) Assets costing upto Rs.5,000/- each are depreciated fully in the
year of purchase.
iv) Lease hold Land is amortised over the period of lease.
Intangible Assets
v) Computer Software is amortized over a period of five years.
d) INVENTORIES
Inventories are valued at lower of cost or net realisable value.
i) Cost of Raw Materials, Stores, Spares etc. is determined on first in
first out basis but excludes sales tax on such purchases within Haryana
which is set off against the Sales tax liability on goods produced from
such purchases and sold during the year. Excise duty is not included in
cost as the Cenvat benefit goes to reduce the cost of materials
purchased.
ii) The cost of finished goods and work in progress includes cost of
raw material and factory overheads. Provision of excise duty on
finished goods is made in accounts and is also considered to determine
the cost of stock of finished goods.
e) Investments
Investments that are readily realizable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long term investments.
Current investments are carried at the lower of cost or fair value.
Long term investments are carried at cost less permanent diminution in
value, if any.
f) REVENUE RECOGNITION
Sale of goods is recognised at the point of dispatch to the customer.
Sales are stated gross of excise duty as well as net of excise duty;
excise duty being the amount included in the amount of gross turnover.
Sales are recorded net of, Sales tax, return / rebate and trade
discounts. Earnings from investments, are accrued or taken into
revenue in full on declaration or receipts. Profit/loss on sale of raw
materials and stores stand adjusted in their consumption account.
g) BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use
or sale. All other borrowing costs are charged to revenue.
h) EMPLOYEE BENEFITS
Contributions to defined Contribution Schemes such as Provident Fund
etc are charged to the Statement of Profit & Loss as and when incurred.
The Gratuity Fund benefits are administered by a Trust recognised by
Income Tax Authorities through the
Group Scheme of LIC of India. The liability for gratuity at the end of
each financial year is determined on the basis of actuarial valuation
carried out by the Insurer''s Actuary on the basis of projected unit
credit method as confirmed to the Company. Company''s contribution is
charged to the Statement of Profit and Loss.
Liability on account of employee benefits comprising of compensated
absences is determined on the basis of actuarial valuation carried out
by the Insurer''s actuary at the end of financial year which is paid to
the LIC of India and Canara Bank, HSBC, Oriental Bank of Commerce Life
Insurance Company Ltd. Company''s contribution is charged to Statement
of Profit and Loss.
Liability on account of bonus and other incentives is recognised on an
undiscounted accrual basis.
i) TAXATION
Provision for income tax is made based on the liability computed in
accordance with relevant tax rates and tax laws.
Deferred tax is recognised, subject to the consideration of prudence,
on timing differences, being the differences between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods.
j) IMPAIRMENT OF ASSETS
Regular review is done to determine whether there is any indication of
impairment of the carrying amount of the Company''s fixed assets. If any
such indication exists, impairment loss i.e. the amount by which the
carrying amount of an asset exceeds its recoverable amount is provided
in the books of accounts. In case there is any indication that an
impairment loss recognized for an asset in prior accounting periods no
longer exists or may have decreased, the recoverable value is
reassessed and the reversal of impairment loss is recognized as income
in the Statement of Profit and Loss.
k) FOREIGN EXCHANGE TRANSACTIONS
Monetary assets and liabilities denominated in foreign currency are
restated at the prevailing year and rates. The resultant gain/loss
upon such restatement alongwith the gain/loss on account of foreign
currency transactions are accounted in the Statement of Profit and
Loss.
l) PROVISIONS AND CONTINGENT LIABILITIES
A provision is recognized when the Company has a present obligation as
a result of a past event and it is probable that an outflow of
resources would be required to settle the obligation, and in respect of
which a reliable estimate can be made.
Provisions are reviewed at each balance sheet date and are adjusted to
effect the current best estimation. A disclosure of contingent
liability is made when there is a possible obligation or a present
obligation that will probably not require outflow of resources or where
a reliable estimate of the obligation can not be made.
RIGHTS, PREFERENCES AND RESTRICTIONS ATTACHED TO SHARES Equity Shares :
The Company has one class of Equity Shares having at par value of Rs
10/- each. Each shareholder is entitled to one vote per share. The
dividend proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing Annual General Meeting, except in
the case of interim dividend. In the event of liquidation of the
company, the equity shareholders will be entitled to receive any of the
remaining assets of the company after distribution of all preferential
amounts, in proportion to their shareholding.
Preference Shares :
Preference shares have at par value of Rs. 100/- each redeemable at par
after 1 st February, 2014. These shares carry a fixed cumulative
dividend of 8% per annum. The preference shareholders are entitled to
preferential rights as regards payment of dividends at above fixed rate
and right of repayment of capital on winding up.
Mar 31, 2012
A) BASIS OF PREPARATION OF ACCOUNTS
The financial statements are prepared under the historical cost
convention, in accordance with applicable mandatory accounting
standards prescribed under the Companies (Accounting Standards), Rules,
2006 and the relevant provisions of the Companies Act, 1956.
All assets and liabilities have been classified as current or non
current as per the Company's normal operating cycle and the criteria
set out in Revised Schedule VI to the Companies Act, 1956. The Company
has ascertained its operating cycle as 12 months for the purpose of
current/non current classification of assets and liabilities.
b) FIXED ASSETS
Fixed assets are stated at cost (net of CENVAT wherever applicable)
less accumulated depreciation. Cos! is inclusive of freight, duties and
levies and any directly attributable cost of bringing the assets to
theii wot king conditions for intended use but excludes recoveries.
Intangibles are stated at cost loss accumulated amount el amortisation.
c) INVESTMENTS
Long term Investments are stated at cost. However, diminution in value
other than temporary is provided I lie Profit/Loss arising on account
of sales is recognised in the Profit and Loss Account. The reduction in
carrying amount is reversed when there is a rise in the value of
investments or if the reasons lor the reduction no lonciei exist.
d) DEPRECIATION/AMORTISATION Tangible Assets
i) Depreciation on fixed assets is provided on straight line method at
rates and in the manner prescribed in Schedule-XIV of the Companies
Act, 1956 except straight line rate on Dies & Moulds at 9'j% per annum
vvlueh is higher than the rate prescribed in the above schedule: The
rate of depreciation on dies & moulds relied Hû- estimated useful life
of such assets.
ii) Depreciation on building other than above is calculated on the
revalued amount at the rates consideied appropriate by the Valuer. Out
of the above, depreciation on original cost on straight line method
basis ,i. prescribed by the Companies Act, 1956 (as amended) is
charged to Profit & Loss Account and l.vil.nn e t i the year is set off
against transfer from Revaluation Reserve.
iii) Assets costing upto Rs.5,000/- each are depreciated fully in the
year of purchase.
iv) Lease hold Land is amortised over the period of lease.
Intangible Assets
v) Computer Software is amortized over a period of five years.
e) INVENTORIES
Inventories are valued at lower of cost or net realisable value.
i) Cost of Raw Materials, Stores, Spares etc. is determined on first in
first out basis but excludes sales tax on such purchases within Haryana
which is set off against the Sales tax liability on goods produced Irom
such purchases and sold during the year. Excise duty is not included in
cost as the Cenvat benefit goes to i educe the cost of materials
purchased.
ii) The cost of finished goods and work in progress includes cost of
raw material and lactory overhead: Provision of excise duty on finished
goods is made in accounts and is also considered to determine the
u'.-.i of stock of finished goods.
f) REVENUE RECOGNITION
i) Sales are recognised when goods are supplied to the customers. Sales
are stated gross of excise duty as well as net of excise duty, excise
duty being the amount included in gross turnover. Sales are recorded
net of , sales tax, returns/rebate and trade discounts.
ii) Dividend income on investments is accounted for when the right to
receive the same is established.
g) BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use
or sale. All other borrowing costs are charged to revenue.
h) EMPLOYEE BENEFITS
Contributions to defined Contribution Schemes such as Provident Fund
etc are charged to the Profit & Loss Account as and when incurred.
The Gratuity Fund benefits are administered by a Trust recognised by
income Tax Authorities through the Group Scheme of LIC of India. The
liability for gratuity at the end of each financial year is determined
on the basis of actuarial valuation carried out by the Insurer's
Actuary on the basis of projected unit credit method as confirmed to
the Company. Company's contribution is charged to the Profit and Loss
Account.
Liability on account of employee benefits comprising of compensated
absences is determined on the basis of actuarial valuation carried out
by the Insurer's actuary at the end of financial year which is paid to
the LIC of India. Company's contribution is charged to profit and loss
account.
Liability on account of bonus and other incentives is recognised on an
undiscounted accrual basis.
i) TAXATION
Provision for income tax is made based on the liability computed in
accordance with relevant tax rates and tax laws.
Deferred tax is recognised, subject to the consideration of prudence,
on timing differences, being the differences between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods.
j) IMPAIRMENT OF ASSETS
Regular review is done to determine whether there is any indication of
impairment of the carrying amount of the Company's fixed assets. If
any such indication exists, impairment loss i.e. the amount by which
the carrying amount of an asset exceeds its recoverable amount is
provided in the books of accounts. In case there is any indication that
an impairment loss recognized for an asset in prior accounting periods
no longer exists or may have decreased, the recoverable value is
reassessed and the reversal of impairment loss is recognized as income
in the Profit and Loss Account.
k) FOREIGN EXCHANGE TRANSACTIONS
Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of transactions. Transactions outstanding at
year end are translated at exchange rates prevailing at the year end
and the profit / loss so determined is ret oqnised in the Profit and
Loss Account.
I) PROVISIONS AND CONTINGENT LIABILITIES
A provision is recognized vhen the Company has a present obligation as
a result of a past event and it is probable that an outflow of
resources would be required to settle the obligation, and in respect of
which a reliable estimate can be made.
Provisions are reviewed at each balance sheet date and are adjusted to
effect the current best estimation. A disclosure of contingent
liability is made when there is a possible obligation or a present
obligation that will probably not require outflow of resources or where
a reliable estimate of the obligation can not be made.
Mar 31, 2011
A) Basis of Accounting:
The financial statements are prepared under the historical cost
convention, in accordance with applicable mandatory accounting
standards prescribed under the Companies (Accounting Standards), Rules,
2006 and the relevant provisions of the Companies Act, 1956.
b) Fixed Assets
i) Fixed assets are stated at cost (net of CENVAT wherever applicable)
less accumulated depreciation. Cost is inclusive of freight, duties and
levies and any directly attributable cost of bringing the assets to
their working conditions for intended use but excludes recoveries.
Intangibles are stated at cost less accumulated amount of amortisation.
c) INVESTMENTS
Long term Investments are stated at cost. However, diminution in value
other than temporary is provided. The Profit/Loss arising on account of
sales is recognised in the Profit and Loss Account. The reduction in
carrying amount is reversed when there is a rise in the value of
investments or if the reasons for the reduction no longer exist.
d) DEPRECIATION/AMORTISATION
Tangible Assets
i) Depreciation on fixed assets is provided on straight line method at
rates and in the manner prescribed in Schedule-XIV of the Companies
Act, 1956 except straight line rate on Dies & Moulds at 95% per annum
which is higher than the rate prescribed in the above schedule: The
rate of depreciation on dies & moulds reflect the estimated useful life
of such assets.
ii) Depreciation on building other than above is calculated on the
revalued amount at the rates considered appropriate by the Valuer. Out
of the above, depreciation on original cost on straight line method
basis as prescribed by the Companies Act, 1956 (as amended) is charged
to Profit & Loss Account and balance for the year is set off against
transfer from Revaluation Reserve.
iii) Assets costing upto Rs.5,000/- each are depreciated fully in the
year of purchase.
iv) Lease hold Land is amortised over the period of lease.
Intangible Assets
v) Computer Software is amortized over a period of five years / two
years.
e) INVENTORIES
Inventories are valued at lower of cost or net realisable value. i)
Cost of Raw Materials, Stores, Spares etc. is determined on first in
first out basis but excludes sales tax on such purchases within Haryana
which is set off against the Sales tax liability on goods produced from
such purchases and sold during the year. Excise duty is not included in
cost as the Cenvat benefit goes to reduce the cost of materials
purchased.
ii) The cost of finished goods and work in progress includes cost of
raw material and factory overheads. Provision of excise duty on
finished goods is made in accounts and is also considered to determine
the cost of stock of finished goods.
f) REVENUE RECOGNITION
i) Sales are recognised when goods are supplied to the customers. Sales
are stated gross of excise duty as well as net of excise duty, excise
duty being the amount included in gross turnover. Sales are recorded
net of, sales tax, returns/rebate and trade discounts.
ii) Dividend income on investments is accounted for when the right to
receive the same is established.
g) BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use
or sale. All other borrowing costs are charged to revenue.
h) EMPLOYEE BENEFITS
Contributions to defined Contribution Schemes such as Provident Fund
etc are charged to the Profit & Loss Account as and when incurred.
The Gratuity Fund benefits are administered by a Trust recognised by
income Tax Authorities through the Group Scheme of LIC of India. The
liability for gratuity at the end of each financial year is determined
on the basis of actuarial valuation carried out by the Insurer's
actuary on the basis of projected unit credit method as confirmed to
the Company. Company's contributions are charged to the Profit and Loss
Account.
Liability on account of short term employee benefits comprising largely
of compensated absences, bonus and other incentives is recognised on an
undiscounted accrual basis.
i) TAXATION
Provision for income tax is made based on the liability computed in
accordance with relevant tax rates and tax laws.
Deferred tax is recognised, subject to the consideration of prudence,
on timing differences, being the differences between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods.
j) MISC EXPENDITURE
Expenses incurred on compensation paid to workers on Voluntary
Retirement Scheme are considered as deferred revenue expenditure and
amortized over a period of three years.
k) IMPAIRMENT OF ASSETS
Regular review is done to determine whether there is any indication of
impairment of the carrying amount of the Company's fixed assets. If any
such indication exists, impairment loss i.e. the amount by which the
carrying amount of an asset exceeds its recoverable amount is provided
in the books of accounts. In case there is any indication that an
impairment loss recognized for an asset in prior accounting periods no
longer exists or may have decreased, the recoverable value is
reassessed and the reversal of impairment loss is recognized as income
in the Profit and Loss Account.
I) FOREIGN EXCHANGE TRANSACTIONS
Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of transactions. Transactions outstanding at
year end are translated at exchange rates prevailing at the year end
and the profit / loss so determined is recognised in the Profit and
Loss Account.
m) PROVISIONS AND CONTINGENT LIABILITIES
A provision is recognized when the Company has a present obligation as
a result of a past event and it is probable that an outflow of
resources would be required to settle the obligation, and in respect of
which a reliable estimate can be made.
Provisions are reviewed at each balance sheet date and are adjusted to
effect the current best estimation. A disclosure of contingent
liability is made when there is a possible obligation or a present
obligation that will probably not require outflow of resources or where
a reliable estimate of the obligation can not be made.
Mar 31, 2010
A) BASIS OF PREPARATION OF FINANCIAL STATEMENT
Basis of Accounting:
The financial statements have been prepared and presented under the
historical cost convention on accrual basis of accounting to comply
with the accounting prescribed in the companies (Accounting Standards)
Rules, 2006 and with the relevant provisions of the Companies, 1956.
b) FIXED ASSETS
Fixed assets are stated at cost (net of CENVAT wherever applicable)
less accumulated depreciation. Cost is inclusive of freight, duties and
levies and any directly attributable cost of bringing the assets to
their working conditions for intended use but excludes recoveries.
Intangibles are stated at cost less accumulated amount of amortisation.
c) INVESTMENTS
Long term Investments are stated at cost. However, diminution in value
other than temporary is provided The Profit/ Loss arising on account of
sales is recognised in the Profit and Loss Account. The reduction in
carrying amount is reversed when there is a rise in the value of
investments or if the reasons for the reduction no longer exist.
d) DEPRECIATION/AMORTISATION
Tangible Assets
i) Depreciation on fixed assets is provided on straight line method at
rates and in the manner prescribed in Schedule-XIV of the Companies
Act, 1956 except straight line rate on Dies & Moulds at 95% per annum
which is higher than the rate prescribed in the above schedule: The
rate of depreciation on dies & moulds reflect the estimated useful life
of such assets.
ii) Depreciation on building other than above is calculated on the
revalued amount at the rates considered appropriate by the Valuer. Out
of the above, depreciation on original cost on straight line method
basis as prescribed by the Companies Act, 1956 (as amended) is charged
to Profit & Loss Account and balance for the year is set off against
transfer from Revaluation Reserve.
iii) Assets costing upto Rs.5,000/- each are depreciated fully in the
year of purchase.
iv) Lease hold Land is amortised over the period of lease.
Intangible Assets
v) Computer Software is amortized over a period of five years / two
years.
e) INVENTORIES
Inventories are valued at lower of cost or net realisable value.
i) Cost of Raw Materials, Stores, Spares etc. is determined on first in
first out basis but excludes sales tax on such purchases within Haryana
which is set off against the Sales tax liability on goods produced from
such purchases and sold during the year. Excise duty is not included in
cost as the Cenvat benefit goes to reduce the cost of materials
purchased.
ii) The cost of finished goods and work in progress includes cost of
raw material and factory overheads. Provision of excise duty on
finished goods is made in accounts and is also considered to determine
the cost of stock of finished goods.
f) REVENUE RECOGNITION
i) Sales are recognised when goods are supplied to the customers and
are recorded net of excise duty, sales tax, returns/rebate and trade
discounts.
ii) Dividend income on investments is accounted for when the right to
receive the same is established.
g) BORROWING COSTS
Borrowing costs that are attributable to the acquisition, construction
or production of qualifying assets are capitalised as part of the cost
of such assets. A qualifying asset is an asset that necessarily
requires a substantial period of time to get ready for its intended use
or sale. All other borrowing costs are charged to revenue.
h) EMPLOYEE BENEFITS
Contributions to defined Contribution Schemes such as Provident Fund
etc are charged to the Profit & Loss Account as and when incurred.
The Gratuity Fund benefits are administered by a Trust recognised by
income Tax Authorities through the Group Scheme of DC of India. The
liability for gratuity at the end of each financial year is determined
on the basis of actuarial valuation carried out by the Insurers
actuary on the basis of projected unit credit method as confirmed to
the Company. Companys contributions are charged to the Profit and Loss
Account.
Liability on account of short term employee benefits comprising largely
of compensated absences, bonus and other incentives is recognised on an
undiscounted accrual basis.
i) TAXATION
Provision for income tax is made based on the liability computed in
accordance with relevant tax rates and tax laws
Deferred tax is recognised, subject to the consideration of prudence,
on timing differences, being the differences between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods. j) MISC. EXPENDITURE
Expenses incurred on compensation paid to workers on Voluntary
Retirement Scheme are considered as deferred revenue expenditure and
amortized over a period of three years.
k) IMPAIRMENT OF ASSETS
After a careful evaluation of the assets, the Company identifies
impairment of assets i.e. the amount by which carrying amount of assets
exceed their recoverable value. Impairment losses, if any, are dealt as
per Accounting Standard (AS)-28.
l) FOREIGN EXCHANGE TRANSACTIONS
Transactions in foreign currencies are recorded at the exchange rates
prevailing on the date of transactions. Transactions outstanding at
year end are translated at exchange rates prevailing at the year end
and the profit / loss so determined is recognised in the Profit and
Loss Account.
m) PROVISIONS AND CONTINGENT LIABILITIES
A provision is recognized when the Company has a present obligation as
a result of a past event and it is probable that an outflow of
resources would be required to settle the obligation, and in respect of
which a reliable estimate can be made.
Provisions are reviewed at each balance sheet date and are adjusted to
effect the current best estimation. A disclosure of contingent
liability is made when there is a possible obligation or a present
obligation that will probably not require outflow of resources or where
a reliable estimate of the obligation can not be made.
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