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Accounting Policies of Precision Electronics Ltd. Company

Mar 31, 2018

Basis of preparation Compliance with Ind AS

In accordance with the notification dated February 16, 2015, issued by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting Standards (referred to as "Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2017 the Financial Statements have been prepared in accordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules, 2015. These are the Company''s first Ind AS Standalone Financial Statements. The date of transition to Ind AS is April 1, 2016. Refer Note 53 for details of Firsttime adoption - mandatory exceptions and optional exemptions availed by the Company.

Up to the year ended March 31, 2017, the Company had prepared the Financial Statements under the historical cost convention on accrual basis in accordance with the Generally Accepted Accounting Principles (Previous GAAP) applicable in India and the applicable Accounting Standards as prescribed under the provisions of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

Reconciliations and descriptions of the effect of the transition has been summarized in note 54.

Historical Cost Convention

The Standalone Financial Statements have been prepared on the historical cost convention, on accrual basis and on the principal of going concern.

Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

The Standalone Financial Statements are presented in Indian Rupees except where otherwise stated.

Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

a. Expected to be realised or intended to be sold or consumed in normal operating cycle.

b. Held primarily for the purpose of trading, or

c. Expected to be realised within twelve months after the reporting period other than for above, or

d. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

All other assets are classified as non-current.

A liability is current when:

a) It is expected to be settled in normal operating cycle

b) It is held primarily for the purpose of trading

c) It is due to be settled within twelve months after the reporting period other than for (a) above, or

d) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

All other liabilities are classified as non-current.

Fair value measurement

The Company measures financial assets at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

The Company categorizes assets and liabilities measured at fair value into one of three levels as follows:

- Level 1 — Quoted (unadjusted)

This hierarchy includes financial instruments measured using quoted prices.

- Level 2

Level 2 inputs include the following:

a. quoted prices for similar assets or liabilities in active markets.

b. quoted prices for identical or similar assets or liabilities in markets that are not active.

c. inputs other than quoted prices that are observable for the asset or liability.

d. Market - corroborated inputs.

Level 3

They are unobservable inputs for the asset or liability reflecting significant modifications to observable related market data or Company''s assumptions about pricing by market participants. Fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

Non-current assets held for sale

Non-current assets and disposal group classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell.

Property Plant and Equipment

Property, Plant and Equipment and intangible assets are not depreciated or amortized once classified as held for sale.

For transition to Ind AS, the Company has elected to continue with the carrying value of its Property, Plant and Equipment (PPE) recognized as of April 1, 2016 (transition date) measured as per the Previous GAAP and used that carrying value as its deemed cost as on the transition date except leasehold land which is remeasured at fair value based on the lease payments and amortized over the period of lease.

PPE are stated at actual cost less accumulated depreciation and impairment loss. Actual cost is inclusive of freight, installation cost, duties, taxes and other incidental expenses for bringing the asset to its working conditions for its intended use (net of CENVAT) and any cost directly attributable to bring the asset into the location and condition necessary for it to be capable of operating in the manner intended by the Management. It includes professional fees and borrowing costs for qualifying assets.

Significant Parts of an item of PPE (including major inspections) having different useful lives & material value or other factors are accounted for as separate components. All other repairs and maintenance costs are recognized in the statement of profit and loss as incurred.

Depreciation of these PPE commences when the assets are ready for their intended use.

Depreciation is provided for on PPE on straight line method on the basis of useful life. On assets acquired on lease (including improvements to the leasehold premises), amortization has been provided for on Straight Line Method over the period of lease.

The estimated useful lives and residual values are reviewed on an annual basis and if necessary, changes in estimates are accounted for prospectively.

Depreciation on subsequent expenditure on PPE arising on account of capital improvement or other factors is provided for prospectively over the remaining useful life.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or over the shorter of the assets useful life and the lease term if there is an uncertainty that the company will obtain ownership at the end of the lease term.

An item of PPE is de-recognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of PPE is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in the Statement of Profit and Loss.

Fixed Assets costing below Rs. 5,000 is fully depreciated in year of purchase.

Intangible Assets

Deemed cost on transition to Ind AS

For transition to Ind AS, the Company has elected to continue with the carrying value of intangible assets recognized as of April 1, 2016 (transition date) measured as per the Previous GAAP and use that carrying value as its deemed cost as on the transition date.

Intangible assets

Recognition of intangible assets

Research and development

Research and development expenditure that do not meet the criteria as below, are recognized as an expense as incurred. Development costs previously recognized as an expense are not recognized as an asset in a subsequent period.

The company initially recognizes development expenses as intangible assets when the company can demonstrate that:

The technical feasibility of completing the intangible asset so that the asset will be available for use or sale

Its intention to complete and its ability and intention to use or sell the asset

How the asset will generate future economic benefits

The availability of resources to complete the asset

The ability to measure reliably the expenditure during development

Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortization and accumulated impairment losses. Amortization of the asset begins when development is complete and the asset is available for use.

It is amortized over the period of expected future benefit. Amortization expense is recognized in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.

During the period of development, the asset is tested for impairment annually.

Computer software

Purchase of computer software used for the purpose of operations is capitalized. However, any expenses on software support, maintenance, upgrade etc. payable periodically is charged to the Statement of Profit & Loss.

De-recognition of intangible assets

An intangible asset is de-recognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from de-recognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, and are recognized in the Statement of Profit and Loss when the asset is de-recognized.

Intangible assets under development

All costs incurred in development, are initially capitalized as Intangible assets under development - till the time these are either transferred to Intangible Assets on completion or expenses as Software Development cost (including allocated depreciation) as and when determined of no further use Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity

Financial assets

Initial recognition and measurement

All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in following categories based on business model of the entity:

- Debt instruments at amortized cost

- Debt instruments at fair value through other comprehensive income (FVTOCI)

- Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)

- Equity instruments measured at fair value through other comprehensive income (FVTOCI)

De-recognition

A financial asset is de-recognized only when

- The Company has transferred the rights to receive cash flows from the financial asset or

- retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the Company has transferred an asset, it evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is de-recognized.

Where the Company has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is de-recognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of Impairment loss on the following financial assets and credit risk exposure:

a) Financial assets that are debt instruments, and are measured at amortized cost e.g., loans, debt securities, deposits, trade receivables and bank balance

b) Financial assets that are debt instruments and are measured as at FVTOCI

c) Lease receivables under Ind AS 17

d) Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind AS 11 and Ind AS 18

e) Loan commitments which are not measured as at FVTPL

f) Financial guarantee contracts which are not measured as at FVTPL.

The Company follows ''simplified approach'' for recognition of impairment loss allowance on:

- Trade receivables or contract revenue receivables; and

- All lease receivables resulting from transactions within the scope of Ind AS 17

ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/ expense in the statement of profit and loss (P&L).

Financial liabilities

Financial liabilities and equity instruments issued by the company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

Initial recognition and measurement

Financial liabilities are recognised when the company becomes a party to the contractual provisions of the instrument. Financial liabilities are initially measured at the amortized cost unless at initial recognition, they are classified as fair value through profit and loss.

Subsequent measurement

Financial liabilities are subsequently measured at amortized cost using the effective interest rate method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognised in the statement of profit and loss.

Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial period which are unpaid. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognized initially at their fair value and subsequently measured at amortized cost using the effective interest method.

Loans and borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process.

Financial guarantee contracts

Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortization.

De-recognition

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. Impairment of non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use.

Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets of Company''s assets.

When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss.

A previously recognized impairment loss (except for goodwill) is reversed only if there has been a change in the assumptions used to determine the asset''s recoverable amount since the last impairment loss was recognized. The reversal is limited to the carrying amount of the asset.

Inventories

Inventories are valued at the lower of cost and net realizable value.

Costs incurred in bringing each product to its present location and conditions are accounted for as follows:

- Raw materials: Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on Weighted Average Cost Method.

- Finished goods and work in progress: Cost includes cost of direct materials and labour and a proportion of manufacturing overheads based on the normal operating capacity but excluding borrowing costs. Cost is determined on Weighted Average Cost Method.

- Traded goods: Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.

- Contract Work in Progress: It is valued estimated at cost

- Loose Tools (Consumable): It is valued at cost.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale

Revenue recognition

Sale of Goods and Rendering of Services

Revenue from the sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

Revenue includes sales during trial run and excise duty/VAT/service tax recoverable but does not include GST. Liquidated damages are accounted for as and when they are ascertained.

Infra revenue and costs are recognized by reference to the stage of completion of the construction activity at the balance sheet date, as measured by the proportion that contract costs incurred for work performed to date bear to the estimated total contract costs. Where the outcome of the infra cannot be estimated reliably, revenue is recognized to the extent of the infra costs incurred if it is probable that they will be recoverable. In the case of contracts with defined milestones and assigned prices for each milestone, it recognizes revenue on transfer of significant risks and rewards which coincides with achievement of milestone and its acceptance by its customers. Provision is made for all losses incurred to the balance sheet date. Any further losses that are foreseen in bringing contracts to completion are also recognised. Variations in contract work, claims and incentive payments are recognised to the extent that it is probable that they will result in revenue and they are capable of being reliably measured. Contract revenue in excess of billing is reflected as unbilled revenue and billing in excess of contract revenue is reflected as unearned revenue.

Revenue in respect of long term turnkey works contracts is recognised under percentage of completion method subject to such contracts having progressed to a reasonable extent. Revenue in respect of other works contracts and services is recognised on completed contract method

Interest income

For all debt instruments measured either at amortized cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR).

Dividends

Revenue is recognized when the Company''s right to receive the payment is established, which is generally when shareholders approve the dividend.

Rental income

Rental income arising from operating leases or on investment properties is accounted for on a straight-line basis over the lease terms and is included in other non- operating income in the statement of profit and loss.

Insurance Claims and Export Incentives

Insurance claims and Export incentives are accounted for on receipts basis.

Excise and custom duty

Excise duty payable on production is accounted for on accrual basis. Provision is made in the books of accounts for customs duty on imported items on arrival and lying in bonded warehouse and awaiting clearance.

Leases

As a lessee

Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to statement of profit and loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases.

As a lessor

Lease income from operating leases where the Company is a lessor is recognised in income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases.

Foreign currency transactions

The functional currency of the Company is Indian Rupees which represents the currency of the economic environment in which it operates.

Transactions in currencies other than the Company''s functional currency are recognized at the rates of exchange prevailing at the dates of the transactions. Monetary items denominated in foreign currency at the year end and not covered under forward exchange contracts are translated at the functional currency spot rate of exchange at the reporting date.

Any income or expense on account of exchange difference between the date of transaction and on settlement or on translation is recognized in the profit and loss account as income or expense.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation difference on such assets and liabilities carried at fair value are reported as part of fair value gain or loss.

In case of forward exchange contracts, the premium or discount arising at the inception of such contracts is amortized as income or expense over the life of the contract. Further exchange difference on such contracts i.e. difference between the exchange rate at the reporting /settlement date and the exchange rate on the date of inception of contract/the last reporting date, is recognized as income/expense for the period.

Employee Obligations

Short term employee benefits: -

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognized in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

Long-Term employee benefits

Compensated expenses which are not expected to occur within twelve months after the end of 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.

Post-employment obligations

Defined contribution plans

Provident Fund and employees'' state insurance schemes

All employees of the Company are entitled to receive benefits under the Provident Fund, which is a defined contribution plan. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (presently 12%) of the employees'' basic salary. These contributions are made to the fund administered and managed by the Government of India. In addition, some employees of the Company are covered under the employees'' state insurance schemes, which are also defined contribution schemes recognized and administered by the Government of India.

The Company''s contributions to both these schemes are expensed in the Statement of Profit and Loss. The Company has no further obligations under these plans beyond its monthly contributions.

Defined benefit plans

Gratuity

The Company provides for gratuity obligations through a defined benefit retirement plan (the ''Gratuity Plan'') covering all employees. The Gratuity Plan provides a lump sum payment to vested employees at retirement or termination of employment based on the respective employee salary and years of employment with the Company. The Company provides for the Gratuity Plan based on actuarial valuations in accordance with Indian Accounting Standard 19 (revised), "Employee Benefits". The Company makes annual contributions to Life Insurance Corporation of India for the Gratuity Plan in respect of employees. The present value of obligation under gratuity is determined based on actuarial valuation using Project Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Defined retirement benefit plans comprising of gratuity, un-availed leave, post-retirement medical benefits and other terminal benefits, are recognized based on the present value of defined benefit obligation which is computed using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. These are accounted either as current employee cost or included in cost of assets as permitted.

Leave Encasement

The company has provided for the liability at period end on account of un-availed earned leave as per the actuarial valuation as per the Projected Unit Credit Method.

Actuarial gains and losses are recognized in OCI as and when incurred.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the statement of profit and loss.

Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest as defined above), are recognized in other comprehensive income except those included in cost of assets as permitted in the period in which they occur and are not subsequently reclassified to profit or loss.

The retirement benefit obligation recognized in the Financial Statements represents the actual deficit or surplus in the Company''s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of reductions in future contributions to the plans.

Termination benefits

Termination benefits are recognized as an expense in the period in which they are incurred.

Borrowing Costs

Borrowing costs that are directly attributable to the acquisition, construction or production of qualifying asset are capitalized as part of cost of such asset. Other borrowing costs are recognized as an expense in the period in which they are incurred.

Borrowing costs consists of interest and other costs that an entity incurs in connection with the borrowing of funds.

Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

Contingent assets are disclosed in the Financial Statements by way of notes to accounts when an inflow of economic benefits is probable.

Contingent liabilities are disclosed in the Financial Statements by way of notes to accounts, unless possibility of an outflow of resources embodying economic benefit is remote.

Cash Flow Statement

Cash flows are reported using the indirect method. The cash flows from operating, investing and financing activities of the Company are segregated.

Cenvat Credit and Input Tax Credit (ITC)

The CENVAT credit /ITC available on purchase of raw materials, other eligible inputs and capital goods is adjusted against excise duty payable on clearance of goods produced. The unadjusted CENVAT credit is shown under the head "short term loans and advances".

Earnings per share

Basic earnings per share are computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share is computed by dividing the profit after tax by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares Income taxes

The income tax expense or credit for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses, if any.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the Standalone Financial Statement. However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.

The carrying amount of deferred tax assets are reviewed at the end of each reporting period and are recognized only if it is probable that future taxable amounts will be available to utilize those temporary differences and losses.

Deferred tax liabilities are not recognized for temporary differences between the carrying amount and tax bases of investments in subsidiaries, branches and associates and interest in joint arrangements where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets are not recognized for temporary differences between the carrying amount and tax bases of investments in subsidiaries, associates and interest in joint arrangements where it is not probable that the differences will reverse in the foreseeable future and taxable profit will not be available against which the temporary difference can be utilized.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Dividend distribution tax paid on the dividends is recognized consistently with the presentation of the transaction that creates the income tax consequence.

Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis. All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material in transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.


Mar 31, 2016

Note1 to the Financial Statements

Significant Accounting Policies

1.1. General

i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the Companies Act, 2013.

1.2. Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

1.3. Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvat if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013, except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

iv) Fixed Assets costing below Rs. 5,000 is fully depreciated in year of purchase.

1.4. Trade receivable:

Trade receivables are stated after making adequate provision for doubtful debts, if any.

1.5. Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

1.6. Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

1.7. Revenue Recognition

i) Revenue from Infra activity.

Infra revenue and costs are recognized by reference to the stage of completion of the construction activity at the balance sheet date, as measured by the proportion that contact costs incurred for work performed to date bear to the estimated total contract costs. Where the outcome of the infra cannot be estimated reliably, revenue is recognized to the extent of the infra costs incurred if it is probable that they will be recoverable. In the case of contracts with defined milestones and assigned prices for each milestone, it recognizes revenue on transfer of significant risks and rewards which coincides with achievement of milestone and its acceptance by its customers. Provision is made for all losses incurred to the balance sheet date. Any further losses that are foreseen in bringing contracts to completion are also recognized. Variations in contract work, claims and incentive payments are recognized to the extent that it is probable that they will result in revenue and they are capable of being reliably measured. Contract revenue in excess of billing is reflected as unbilled revenue and billing in excess of contract revenue is reflected as unearned revenue.

ii) Revenue other than Infra activity.

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates.

iii) Scrap is accounted for as and when sold.

iv) Export incentives and insurance claims are accounted for on receipt basis.

1.8. Method of valuation of inventories is as under:

i) Raw materials are valued at Cost, on weighted average basis and non-moving Items are valued at net realizable value.

ii) Components, Stores & Spare parts are valued at cost, on FIFO basis.

iii) Finished goods and Traded Goods are valued at cost or net realizable value, whichever is lower.

iv) Goods-in-Process are valued at estimated cost.

v) Cost incurred that relate to future activities on the contract are recognized as "Contract work in progress". Contract work in progress comprising infra costs and other directly attributable overheads is valued at lower of cost and net realizable value.

1.9. Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

1.10. Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

1.11. Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

1.12. Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India (''LIC'') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees'' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

1.13. Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future

1.14. Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis .All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material-in-transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

1.15 Recognition of Prior Period Expenses & Prepaid Expenses:

Prepaid expenses and prior period expenses/income of items of Rs. 10,000/- and below are charged to natural head of accounts.


Mar 31, 2015

1.1. General

i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the Companies Act, 2013.

1.2. Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in period in which the result are known/materialized.

1.3. Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvat if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013, except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

iv) Fixed Assets costing below Rs. 5,000 is fully depreciated in year of purchase.

1.4. Trade receivable:

Trade receivables are stated after making adequate provision for doubtful debts, if any.

1.5. Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

1.6. Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

1.7. Revenue Recognition

i) Revenue from Infra activity.

Infra revenue and costs are recognized by reference to the stage of completion of the construction activity at the balance sheet date, as measured by the proportion that contact costs incurred for work performed to date bear to the estimated total contract costs. Where the outcome of the infra cannot be estimated reliably, revenue is recognized to the extent of the infra costs incurred if it is probable that they will be recoverable. In the case of contracts with defined milestones and assigned prices for each milestone, it recognises revenue on transfer of significant risks and rewards which coincides with achievement of milestone and its acceptance by its customers. Provision is made for all losses incurred to the balance sheet date. Any further losses that are foreseen in bringing contracts to completion are also recognised. Variations in contract work, claims and incentive payments are recognised to the extent that it is probable that they will result in revenue and they are capable of being reliably measured. Contract revenue in excess of billing is reflected as unbilled revenue and billing in excess of contract revenue is reflected as unearned revenue.

ii) Revenue other than Infra activity.

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates.

iii) Scrap is accounted for as and when sold.

iv) Export incentives and insurance claims are accounted for on receipt basis.

1.8. Method of valuation of inventories is as under:

i) Raw material are valued at Cost, on Weighted average basis and non-moving Items are valued at net realizable value.

ii) Components, Stores & Spare parts are valued at cost, on FIFO basis.

iii) Finished goods and Traded Goods are valued at cost or net realizable value, whichever is lower.

iv) Goods-in-Process are valued at estimated cost.

v) Cost incurred that relate to future activities on the contract are recognized as "Contract work in progress". Contract work in progress comprising infra costs and other directly attributable overheads is valued at lower of cost and net realizable value.

1.9. Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

1.10. Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

1.11. Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

1.12. Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India ('LIC') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

1.13. Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future

1.14. Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis .All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material-in- transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

1.15 Recognition of Prior Period Expenses & Prepaid Expenses:

Prepaid expenses and prior period expenses/income of items of Rs. 10,000/- and below are charged to natural head of accounts.


Mar 31, 2014

1.1. General

i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the companies Act, 1956.

1.2. Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

1.3. Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvat if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation has been provided on the straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

iv) Fixed Assets costing below Rs. 5000 is fully depreciated in year of purchase.

1.4. Trade receivable:

Trade receivables are stated after making adequate provision for doubtful debts, if any.

1.5. Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

1.6. Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

1.7. Revenue Recognition

i) Revenue from Infra activity.

Infra revenue and costs are recognized by reference to the stage of completion of the construction activity at the balance sheet date, as measured by the proportion that contract costs incurred for work performed to date bear to the estimated total contract costs. Where the outcome of the infra cannot be estimated reliably, revenue is recognized to the extent of the infra costs incurred if it is probable that they will be recoverable. In the case of contracts with defined milestones and assigned prices for each milestone, it recognises revenue on transfer of significant risks and rewards which coincides with achievement of milestone and its acceptance by its customers. Provision is made for all losses incurred to the balance sheet date. Any further losses that are foreseen in bringing contracts to completion are also recognised. Variations in contract work, claims and incentive payments are recognised to the extent that it is probable that they will result in revenue and they are capable of being reliably measured. Contract revenue in excess of billing is reflected as unbilled revenue and billing in excess of contract revenue is reflected as unearned revenue.

ii) Revenue other than Infra activity.

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates.

iii) Scrap is accounted for as and when sold.

iv) Export incentives and insurance claims are accounted for on receipt basis.

1.8. Method of valuation of inventories is as under:

i) Raw material are valued at Cost, on Weighted average basis and non-moving Items are valued at net realizable value.

ii) Components, Stores & Spare parts are valued at cost, on FIFO basis.

iii) Finished goods & Traded Goods are valued at cost or net realizable value, whichever is lower.

iv) Goods-in-Process are valued at estimated cost.

v) Cost incurred that relate to future activities on the contract are recognized as "Contract work in progress". Contract work in progress comprising infra costs and other directly attributable overheads is valued at lower of cost and net realizable value.

1.9. Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

1.10. Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

1.11. Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

1.12. Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India (''LIC'') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees'' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

1.13 Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future.

1.14. Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis .All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material-in-transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

1.15 Recognition of Prior Period Expenses & Prepaid Expenses:

Prepaid expenses and prior period expenses/income of items of Rs.10,000/- and below are charged to natural head of accounts.


Mar 31, 2013

1. General

(i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

(ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the companies Act, 1956.

2. Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

3. Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvat if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation has been provided on the straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

4. Trade receivable:

Trade receivables are stated after making adequate provision for doubtful debts, if any.

5. Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

6. Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

7. Sales

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates.

8. Method of valuation of inventories is as under:

i) Raw material At cost, on FIFO/weighted average basis, and non-moving Items are valued at net Releasable value.

Ii) Components, Stores & Spare parts

At cost, on FIFO basis

iii) Finished goods &

Traded Goods

At cost or net realizable value, whichever is lower

iv) Goods-in-Process At estimated cost.

9. Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

10. Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

11. Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

12. Export incentives and insurance claims are accounted for on receipt basis.

13. Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India (''LIC'') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees'' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

14. Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future

15. Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis .All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material-in- transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.


Mar 31, 2012

1. General

(i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

(ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the companies Act, 1956.

2. Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

3. Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvat if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation has been provided on the straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

4. Trade receivable:

Trade receivables are stated after making adequate provision for doubtful debts, if any.

5. Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

6. Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

7. Sales

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates.

8. Method of valuation of inventories is as under:

i) Raw material At cost, on FIFO/weighted average basis, and non-moving

Items are valued at net Releasable value.

ii) Components, Stores At cost, on FIFO basis & Spare parts

iii) Finished goods &

Traded Goods At cost or net realizable value, whichever is lower

iv) Goods-in-Process At estimated cost.

9. Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the anything cost of such fixed assets.

10. Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

11. Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

12. Export incentives and insurance claims are accounted for on receipt basis.

13. Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India ('LIC') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

14. Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future

15. Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis. All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material- in-transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.


Mar 31, 2011

A) General

i) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

ii) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the companies Act, 1956.

b) Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosers relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

c) Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvet if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation except in the case of Leasehold land which has been revalued as on 31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation has been provided on the straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except software having future economic benefits more than a year, to be amortized in two to three years.

iii) Leasehold land is amortized over the years of lease.

d) Sundry Debtors:

Sundry Debtors are stated after making adequate provision for doubtful debts, if any.

e) Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, if any.

f) Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

g) Sales

Sales include excise duty, Sales Tax/ VAT and are net of usual trade discounts, rebates. h) Method of valuation of inventories is as under:

i) Raw material At cost, on FIFO/weighted average basis, and none moving

Items are valued at net Realisable value. ii) Components, Stores At cost, on FIFO basis & Spare parts

iii) Finished & Traded At cost or net realisable value, whichever Goods is lower

iv) Goods-in-Process At estimated cost.

i) Foreign Exchange Transactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year endi rates in all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

j) Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated as addition to Fixed Assets.

k) Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

l) Export incentives and insurance claims are accounted for on receipt basis.

m) Investments

Investments are stated at Cost and where there is permanent diminution in the value of Investments a provision is made wherever applicable. Dividend will be accounted for as and when received.

n) Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India ('LIC') for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by an independent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit & Loss Account.

o) Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit for the year is accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjusted in the future

p) SegmentAccounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis. All other segment revenue and expenses are directly attributed to the segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material- in-transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.


Mar 31, 2010

A) General

a) The accounts are prepared on historical cost convention, on accrual basis and on the principal of going concern.

b) Accounting policies not specifically referred to otherwise, are consistent and in accordance with Indian generally accepted accounting practices comprising of the mandatory Accounting Standard, Guidance notes and other pronouncements issued by ICAI and the provision of the Companies Act,1956.

b) Use of Estimates

The preparation of financial statement require estimates and assumption that affect the reported amounts of income and expenses of the period, the reported amounts of assets and liabilities and disclosures relating to contingent liabilities as on the date of financial statements. Difference between the actual result and estimated are recognized in the period in which the result are known/materialized.

c) Fixed Assets:

i) Fixed Assets are stated at cost of acquisition less cenvet if any and subsequent improvements thereto including taxes, duties, freight and other incidental expenses related to acquisition and installation exceptin the caseof Leasehold land which has been revalued ason31.3.2006.

ii) Fixed Assets are stated at cost less accumulated depreciation. Depreciation has been provided on the straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except software having future economic benefits more than a year, to be amortized intwo tothree years.

iii) Lease hold land is amortized over the yearsof lease.

d) Sundry Debtors:

Sundry Debtors are stated after making adequate provision for doubtful debts,if any.

e) Loans & Advances:

Loans and Advances are stated after making adequate provision for doubtful advances, ifany.

f) Contingent Liabilities:

Contingent liabilities are not provided for in the accounts and are shown separately in Notes on Accounts.

g) Sales

Sales include excise duty, Sales Tax/ VAT and are netof usual trade discounts, rebates.

h) Method of valuation of inventories is as under:

i) Rawmaterial At cost, on FIFO/weighted average basis, and none moving Items are valued atnet Releasable value.

ii) Components, Stores Atcost, on FIFO basis & Spareparts

iii) Finished goods Atcostornet realizable value, whicheverislower

iv) Goods-in-Process Atestimated cost.



i) Foreign ExchangeTransactions

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing atthe timeof the transaction.

ii) Assets and liabilities relating to foreign currency transactions remaining unsettled at the end of the year are translated at contracted rates, when covered by foreign exchange contracts and at year end ratesin all other cases.

iii) Gains and Losses on foreign exchange transaction/ translation other than those relating to fixed assets are recognized in the Profit and Loss Account. Gain or loss on translation of long term liabilities incurred to acquire fixed assets is treated as an adjustment to the carrying cost of such fixed assets.

j) Research & Development

Revenue Expenditure on R&D is charged to revenue under the respective heads of accounts. Capital Expenditure on R&D is treated asaddition to Fixed Assets.

k) Technical know-how is accounted for on payment basis and is written-off over a period of six years from the year of payment.

l) Export incentives and insurance claims are accounted foron receipt basis.

m) Employees Benefits

The Company has taken Group Gratuity Policy with the Life Insurance Corporation of India (LIC) for future payment of gratuities which is a defined benefit. The gratuity liability is determined based on an actuarial valuation performed by LIC.

Provision for Leave Encashment, which is a defined benefit, is made on an actuarial valuation carried out by anindependent actuary.

Contribution to Provident Fund is accrued as per the provisions of the Employees Provident Fund and Miscellaneous Provisions Act 1952. Contribution payable to Provident fund is charged to Profit &Loss Account.

n) Provision for Current and Deferred Tax

Provision for current tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act1961.

Deferred tax resulting from “Timing Differences” between book and taxable profit for the yearis accounted for using the tax rate and laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be adjustedin the future

o) Segment Accounting:

i) Segment Revenue & Expenses:

Joint revenue & expenses of the segments are allocated among them on reasonable basis .All other segment revenue and expenses are directly attributed tothe segments.

ii) Segment Assets & liabilities:

Segment assets include plant & machinery, Inventory, security deposit, earnest money and material- in-transit and segment liabilities include sundry creditors.

iii) Inter Segment sales:

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated inconsolidation.

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