Mar 31, 2014
1. Accounting Conventions
The Accounts are prepared under historical cost convention based on
generally accepted accounting principles and applicable Accounting
Standards specified by the Institute o Chartered Accountants of India
and IRAC norms issued by RBI. The Company follows accrual system of
accounting and recognition of Income and Expenditure is on Accrual
basis. Accounting policies, unless specifically stated to be other, are
consistent and are in consonance with generally accepted accounting
policies.
2. Fixed Assets and Depreciation
Fixed assets, except land are stated at cost of acquisition cost, net
of accumulated depreciation The cost comprises of purchase cost and
other directly attributable cost of bringing the assets to Its working
condition for intended use. Any trade discount and rebates are deducted
in arriving at the purchase price.
Depreciation on fixed assets is calculated under WDV method as per
Schedule XIV of the companies Act 1956.
3. Inventory
Inventories are stated at lower of cost. Cost is determined on weighted
average/First in first out (FIFO) basis, as considered appropriate by
the company. The cost of finished goods and work in progress comprises
raw materials, direct labour, other direct cost and related production
overheads.
4. Investments
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 nature, in the opinion of the management.
5. Gratuity
Provisions of payment of Gratuity Act are not applicable to the Company
for the year under review.
6. Taxation
In accordance with the requirements of Accounting Standards - 22
relating to Taxation on income the deferred tax assets has not been
currently recognized in the accounts, as a measure of prudence and as
recommended by Accounting Standard - 22.
7. Provisions and contingent Liabilities
Provisions: Provisions are measured at the best estimate of the
expenditure required to settle the present obligation at the balance
sheet date and are not discounted to its present value.
Contingent Liabilities: Contingent liabilities represent items that are
not recognized in the Statement of Financial Position because there is
significant uncertainty at that date as to the necessity for the entity
to receive or make payments in respect of them.
There is a claim of the WBSEDCL amounting to Rs. 2,74,03,132/- against
which a case is pending in the High Court.