Mar 31, 2015
Corporate Information
Real Strips Limited (the Company) is a Listed public company domiciled
in India and incorporated under the provisions of the Companies Act,
1956. The Company is engaged in Business of manufacturing/trading of
Cold Rolled Stainless Strips/coils. Its shares are listed on Bombay
Stock Exchange in India.
1.01 Basis of Preparation of Financial Statements
The Financial Statements are prepared to comply in all material
respects with the Accounting Standards notified by the Companies
(Accounts) Rules, 2014 and the relevant provisions of the Companies
Act, 2013. The financial statements have been prepared under the
historical cost convention on an accrual basis in accordance with the
generally accepted accounting principles in India.
1.02 Use of Estimates
The preparation of financial statements in confirmity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets &
liabilities and disclosures of contingent liabilities at the date of
financial statements and the results of operation during the reporting
period. Although these estimates are based upon management's best
knowledge of current events and actions, actual results could differ
from these estimates. Difference between the actual results and
estimates are recognized in the period in which the results are
known/materialised.
1.03 Tangible Assets :
a) Fixed assets are stated at cost of acquisition or construction less
accumulated depreciation. The cost of fixed assets includes non
refundable taxes, duties, freight and other incidental expenses related
to the acquisition and installation of the respective assets.
b) All the preoperative expenditure including interest on borrowing for
the project/ item, incurred on capital work in progress or on fixed
assets upto the date of installation of the individual item as taken by
the company is capitalized and added on pro-rata basis to the cost of
respective fixed Assets.
1.04 Intangible Assets :
An intangible asset is recognised, only where it is probable that
future economic benefits attributable to the asset will accrue to the
enterprise and the cost can be measured reliably.
1.05 Borrowing Costs:
Borrowing Costs that are directly attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Exchange difference arising from foreign currency term
loan borrowing beyond adjustment to interest cost is capitalized as
part of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
1.06 Impairment of Assets:
a) The Company assesses at each Balance Sheet date whether there is any
indication that an asset may be impaired. If any such indication
exists, the Company estimates the recoverable amount of the assets. If
such recoverable amount of the assets is less than its carrying amount,
the carrying amount is reduced to its recoverable amount. The reduction
is treated as an impairment loss and is recognized in the statement of
profit and loss. If at the Balance Sheet date there is an indication
that if a previously assessed impairment loss no longer exists, the
recoverable amount is reassessed and the asset is reflected at the
recoverable amount subject to a maximum of depreciated historical cost.
b) After impairment, depreciation is provided on the revised carrying
amount after deducting 5% of Historical cost of the asset over its
remaining useful life.
1.07 Provisions, Contingent Liabilities and Contingent Assets:
A provision is recognised when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
Contingent Liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
1.08 Leases:
Where the Company is the lessee
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as a Capital
assets till the assets are not put to use.
1.09 Deferred Revenue Expenses And Public Issue Expenses:
Public Issue Expenses and Preliminary expenses are amortized over a
period of 5 years.
1.10 Depreciation:
a) The company has provided Depreciation on Straight-Line Method (SLM)
on a) Plant & Machinery and b) Vehicles over the useful life of Assets
as defined in Schedule II of the Companies Act, 2013.
b) Building, Furniture & Fixtures and Computers are depreciated on the
Written Down Method over the useful life of Assets as defined in
Schedule II of the Companies Act, 2013.
c) The Life has been decided by the Management considering the type and
nature of assets as defined in Schedule II of The Companies Act, 2013.
Except in case of Workroll, where the useful life of the asset is
taken as less than one year considering it's nature & frequent
replacement.
d ) Since the Depreciation for the Year under consideration has been
computed considering the Balance useful life of the assets to comply
with requirements of Schedule II of Companies Act, 2013, and being a
transitional year, the Impact of change in method of depreciation has
been reported.
1.11 Inventories :
Raw materials,Work in Progress and finished goods are valued at lower of
cost or net realisable value. Stores & spare parts are stated at cost.
Cost comprise all cost of purchase, cost of conversion and other costs
incurred in bringing the inventories to their present location and
condition. Cost formulae used is 'First-in-First-Out method'.
1.12 Revenue Recognition
a) Revenue from operations (gross) represents the amounts receivable
for goods and services sold including excise duty thereon, Interest for
late payment and forfeiture of sales advances,but excludes VAT/CST,
trade discounts & other taxes, adjustments for late delivery charges
and material returned/rejected.
b) Interest income is recognized on time proportion basis taking into
account the amounts outstanding and the rates applicable.
c) Dividend is recognized when the Company's right to receive dividend
is established by the balance sheet date.
d ) Revenue from windmill is recognised on unit generation basis.
1.13 Raw Material Consumption :
Cost of Raw Material Consumed includes interest expenses for late
payment to suppliers.
1.14 Excise / Custom Duties:
Excise Duty on manufactured goods remaining in the inventory is
included as a part of valuation of finished goods & Scrap. The customs
duty on raw materials, stores, spares & components is accounted on
clearance thereof.
1.15 Foreign Currency Transactions :
a) Foreign currency transaction are accounted at the exchange rate
prevailing on the date of transaction. Monetary items related to
foreign currency transaction remaining unsettled at the end of the year
are translated at year end rates. Any exchange gain or loss arising out
of the subsequent fluctuation are accounted for in the Statement of
Profit and Loss.
b) In respect of forward contracts assigned to the foreign currency
assets/liabilities as at Balance Sheet date, the proportionate
premium/discount for the period up to the date of Balance sheet is
recognized in the Statement of Profit and Loss. The exchange difference
measured by the exchange rate between the inception of the forward
contract and agreed contracted rate is applied on foreign currency
amount of the forward contract.
1.16Treatment Of Retirement Benefits :
Company contributes to group gratuity policy with SBI Life Insurance as
per actuarial valuation as on the Balance Sheet date for future payment
of Gratuity to employees. Company's contributions paid/payable during
the year to Provident Fund are charged to the Statement of Profit &
Loss. Privilege leave is accounted for on accrual basis.
1.17Taxation:
Income-tax expense comprises current tax and deferred tax charge or
credit. Tax on income for the current period is determined on financial
year basis computed in accordance with the provisions of the Income Tax
Act,1961 and based on expected outcome of assessment/appeal.
Minimum Alternative Tax (MAT) paid in accordance to the tax laws ,
which gives rise to the future economic benefits in the form of
adjustment of future income tax liability, is considered as an asset if
there is convincing evidence that the Company will pay normal income
tax after the tax holiday period . Accordingly, MAT is recognised as an
asset as MAT Credit Entitlement in the balance sheet when it is
probable that the future economic benefit associated with it will flow
to the Company and the asset can be measured reliably.
1.18 Deferred Taxation:
The deferred tax charge or credit is recognised using the tax rates
that have been enacted or substantially enacted by the balance sheet
date. Where there is unabsorbed depreciation or carry forward losses,
deferred tax assets are recognised only if there is virtual certanity
of realisation of such assets. Other deferred tax assets are recognised
only to the extent there is reasonable certanity of realisation in
future. Deferred tax assets/ liabilities are reviewed as at each
Balance Sheet date based on development during the year and available
case laws, to reassess realisation/liabilities.
1.19 Investment:
Investments are stated at cost. Dimunition in the value, if any, which
is of permanent nature is provided for.
1.20 Cash and Cash Equivalents
Cash and cash equivalents for the purposes of cash flow statement
comprise cash at bank and in hand and short- term investments with an
original maturity of three months or less.
1.21 Cash Flow Statement
Cash flow statement is prepared using the indirect method, whereby
profit before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flow from operating,
investing and financing activities of the Company are segregated based
on the available information.
1.22Segment Reporting
The Company's operating businesses are organised and managed separately
according to the nature of products provided, with each segment
representing a strategic business unit that offers different products
and serves different markets. The analysis of geographical segment is
based on the geographical location of the customers.
The company prepares its segment information in confirmity with the
accounting policies adopted for preparing and presenting the financial
statements of the company as a whole.
1.23 General
Accounting policies not specifically referred to are consistent with
generally accepted accounting policies.
Mar 31, 2014
Corporate Information
Real Strips Limited (the Company) is a public company domiciled in
India and incorporated under the provisions of the Companies Act, 1956.
The Company is engaged in manufacturing/trading of Cold Rolled
Stainless Strips/coils. Its shares are listed on Bombay Stock Exchange
in India.
1.01 Basis of Preparation of Financial Statements:
The Financial Statements are prepared to comply in all material
respects with the Accounting Standards notified by the Companies
(Accounting Standards) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 . The financial statements have been prepared under
the historical cost convention on an accrual basis in accordance with
the generally accepted accounting principles in India.
1.02 Use of Estimates
The preparation of financial statements in confirmity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets &
liabilities and disclosures of contingent liabilities at the date of
financial statements and the results of operation during the reporting
period. Although these estimates are based upon management''s best
knowledge of current events and actions, actual results could differ
from these estimates. Difference between the actual results and
estimates are recognized in the period in which the results are
known/materialised.
1.03 Tangible Assets
a) Fixed assets are stated at cost of acquisition or construction less
accumulated depreciation. The cost of fixed assets includes non
refundable taxes, duties, freight and other incidental expenses related
to the acquisition and installation of the respective assets.
b) All the preoperative expenditure including interest on borrowing for
the project/item, incurred on capital work in progress or on fixed
assets upto the date of installation of the individual item as taken by
the company is capitalized and added on pro-rata basis to the cost of
respective fixed Assets.
1.04 Intangible Assets
An intangible asset is recognised, only where it is probable that
future economic benefits attributable to the asset will accrue to the
enterprise and the cost can be measured reliably.
1.05 Borrowing Costs
Borrowing Costs that are directly attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Exchange difference arising from foreign currency term
loan borrowing beyond adjustment to interest cost is capitalized as
part of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
1.06 Impairment of Assets
a) The Company assesses at each Balance Sheet date whether there is any
indication that an asset may be impaired. If any such indication
exists, the Company estimates the recoverable amount of the assets. If
such recoverable amount of the assets is less than its carrying amount,
the carrying amount is reduced to its recoverable amount. The reduction
is treated as an impairment loss and is recognized in the statement of
profit and loss. If at the Balance Sheet date there is an indication
that if a previously assessed impairment loss no longer exists, the
recoverable amount is reassessed and the asset is reflected at the
recoverable amount subject to a maximum of depreciated historical cost.
b) After impairment, depreciation is provided on the revised carrying
amount of the asset over its remaining useful life.
1.07 Provisions, Contingent Liabilities and Contingent Assets
A provision is recognised when the Company has a present obligation as
a result of past event and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
Contingent Liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
1.08 Leases
Where the Company is the lessee
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as a Capital
assets till the assets are not put to use.
1.09 Deferred Revenue Expenses And Public Issue Expenses
Public Issue Expenses and Preliminary expenses are amortized over a
period of 5 years.
1.10 Depreciation
The company provides depreciation on Straight Line method on (a) Plant
and Machinery and (b) Vehicles, whereas on (a) Building (b) Furniture
and Fixtures and (c) computer, depreciation is provided on Written Down
Value Method, at the rates and manner specified in Schedule XIV of the
Companies Act, 1956, on the basis of shift wise working as determined
by the company.
1.11 Inventories
Raw materials, Work in Progress and finished goods are valued at lower
of cost or net realisable value. Stores & spare parts are stated at
cost. Cost comprise all cost of purchase, cost of conversion and other
costs incurred in bringing the inventories to their present location
and condition. Cost formulae used is ''First-in-First-Out method''.
1.12 Revenue Recognition
a) Revenue from operations (gross) represents the amounts receivable
for goods and services sold including excise duty thereon and
forfeiture of sales advances, but excludes VAT/CST, trade discounts &
other taxes, adjustments for late delivery charges and material
returned/rejected.
b) Interest income is recognized on time proportion basis taking into
account the amounts outstanding and the rates applicable.
c) Dividend is recognized when the Company''s right to receive dividend
is established by the balance sheet date.
d) Revenue from windmill is recognised on unit generation basis.
1.13 Raw Material Consumption
Raw Material Consumed includes interest expenses for late payment to
suppliers.
1.14 Excise/Custom Duties
Excise Duty on manufactured goods remaining in the inventory is
included as a part of valuation of finished goods. The customs duty on
raw materials, stores, spares & components is accounted on clearance
thereof.
1.15 Foreign Currency Transactions
a) Foreign currency transaction are accounted at the exchange rate
prevailing on the date of transaction. Monetary items related to
foreign currency transaction remaining unsettled at the end of the year
are translated at year end rates. Any exchange gain or loss arising out
of the subsequent fluctuation are accounted for in the Statement of
Profit and Loss.
b) In respect of forward contracts assigned to the foreign currency
assets/liabilities as at Balance Sheet date, the proportionate
premium/discount for the period up to the date of Balance sheet is
recognized in the Statement of Profit and Loss. The exchange difference
measured by the exchange rate between the inception of the forward
contract and agreed contracted rate is applied on foreign currency
amount of the forward contract.
1.16 Treatment Of Retirement Benefits
Company contributes to group gratuity policy with SBI Life Insurance as
per actuarial valuation as on the Balance Sheet date for future payment
of Gratuity to employees. Company''s contributions paid/payable during
the year to Provident Fund are charged to the Statement of Profit &
Loss. Privilege leave is accounted for on accrual basis.
1.17 Taxation
Income-tax expense comprises current tax and deferred tax charge or
credit. Tax on income for the current period is determined on financial
year basis computed in accordance with the provisions of the Income Tax
Act,1961 and based on expected outcome of assessment/appeal.
Minimum Alternative Tax (MAT) paid in accordance to the tax laws, which
gives rise to the future economic benefits in the form of adjustment of
future income tax liability, is considered as an asset if there is
convincing evidence that the Company will pay normal income tax after
the tax holiday period . Accordingly, MAT is recognised as an asset as
MAT Credit Entitlement in the balance sheet when it is probable that
the future economic benefit associated with it will flow to the Company
and the asset can be measured reliably.
1.18 Deferred Taxation
The deferred tax charge or credit is recognised using the tax rates
that have been enacted or substantially enacted by the balance sheet
date. Where there is unabsorbed depreciation or carry forward losses,
deferred tax assets are recognised only if there is virtual certanity
of realisation of such assets. Other deferred tax assets are recognised
only to the extent there is reasonable certanity of realisation in
future. Deferred tax assets/liabilities are reviewed as at each
Balance Sheet date based on development during the year and available
case laws, to reassess realisation/liabilities.
1.19 Investment
Investments are stated at cost. Dimunition in the value, if any, which
is of permanent nature is provided for.
1.20 Cash and Cash Equivalents
Cash and cash equivalents for the purposes of cash flow statement
comprise cash at bank and in hand and short-term investments with an
original maturity of three months or less.
1.21 Cash Flow Statement
Cash flow statement is prepared using the indirect method, whereby
profit before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flow from operating,
investing and financing activities of the Company are segregated based
on the available information.
1.22 General
Accounting policies not specifically referred to are consistent with
generally accepted accounting policies.
Mar 31, 2012
1.01 Basis of Preparation of Financial Statements
The Financial Statements are prepared to comply in all material
respects with the Accounting Standards notified by the Companies
(Accounting Standards) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 . The financial statements have been prepared under
the historical cost convention on an accrual basis in accordance with
the generally accepted accounting principles in India.
1.02 Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets &
liabilities and disclosures of contingent liabilities at the date of
financial statements and the results of operation during the reporting
period. Although these estimates are based upon management's best
knowledge of current events and actions, actual results could differ
from these estimates.
1.03 Tangible Assets :
i. The Gross Block of fixed assets are shown at cost which includes
taxes, duties and preoperative expenses. Cost of Fixed Assets has been
reduced to the extent of Excise Duty under Capital Cenvat Scheme,
Service Tax & VAT where such credit is availed.
ii. Capital work in progress is shown at cost and includes Capital
Goods in Transit.
iii. All the preoperative expenditure including interest on borrowing
for the project/ item, incurred on capital work in progress or on fixed
assets upto the date of installation of the individual item as taken by
the company is capitalized and added on pro- rata basis to the cost of
respective fixed Assets.
1.04 Intangible Assets:
An intangible asset is recognised, only where it is probable that
future economic benefits attributable to the asset will accrue to the
enterprise and the cost can be measured reliably.
1.05 Borrowing Costs:
Borrowing Costs that are directly attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Exchange difference arising from foreign currency term
loan borrowing beyond adjustment to interest cost is capitalized as
part of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
1.06 Impairment of Assets:
a The carrying amounts of assets are reviewed at each balance sheet
date if there is any indication of impairment based on
internal/external factors. On such indication, the recoverable amount
of the assets is estimated and if such estimation is less than its
carrying amount, the carrying amount is reduced to its recoverable
amount. The recoverable amount is the greater of the asset's net
selling price and value in use. 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 risks specific to the asset.
b After impairment, depreciation is provided on the revised carrying
amount of the asset over its remaining useful life.
1.07 Provisions, Contingent Liabilities and Contingent Assets:
A provision is recognised when the Company has a present obligation as
a result of past event; it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate required to
settle the obligation at the balance sheet date. These are reviewed at
each balance sheet date and adjusted to reflect the current best
estimates.
Contingent Liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
1.08 Leases:
Where the Company is the lessee
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased item, are classified as
operating leases. Operating lease payments are recognized as a Capital
assets till the assets are not put to use.
1.09 Deferred Revenue Expenses And Public Issue Expenses:
Public Issue Expenses and Preliminary expenses are amortized over a
period of 5 years.
1.10 Depreciation:
The company provides depreciation on Straight Line method on (a) Plant
and Machinery and (b) Vehicles, whereas on (a) Building
(b) Furniture and Fixtures and (c) computer, depreciation is provided
on Written Down Value Method, at the rates and manner specified in
Schedule XIV of the Companies Act, 1956.
1.11 Inventories:
Raw materials, Work in Progress and finished goods are valued at lower
of cost or net realisable value. Stores & spare parts are stated at
cost. Cost comprise all cost of purchase, cost of conversion and other
costs incurred in bringing the inventories to their present location
and condition. Cost formulae used is 'First-in-First-Out method
1.12 Sales:
Sales includes sales value of goods, Excise duty but excludes VAT/CST,
trade discount & other taxes and material returned/rejected and the
Operational income includes job charges income.
1.13 Raw Material Consumption :
Raw Material Consumed includes interest expenses for late payment to
suppliers.
1.14 Excise / Custom Duties:
Excise Duty on manufactured goods remaining in the inventory is
included as a part of valuation of finished goods. The customs duty on
raw materials, stores, spares & components is accounted on clearance
thereof.
1.15 Foreign Currency Transactions :
(a) Foreign currency transaction are accounted at the exchange rate
prevailing on the date of transaction. Monetary items related to
foreign currency transaction remaining unsettled at the end of the year
are translated at year end rates. Any exchange gain or loss arising out
of the subsequent fluctuation are accounted for in the Profit and Loss
Account.
(b) In respect of forward contracts assigned to the foreign currency
assets/liabilities as at Balance Sheet date, the proportionate
premium/discount for the period up to the date of Balance sheet is
recognized in the Profit and Loss account. The exchange difference
measured by the exchange rate between the inception of the forward
contract and date of balance sheet is applied on foreign currency
amount of the forward contract.
1.16 Treatment Of Retirement Benefits :
Company contributes to group gratuity policy with SBI Life Insurance as
per actuarial valuation as on the Balance Sheet date for future payment
of Gratuity to employees. Company's contributions paid/payable during
the year to Provident Fund are charged to the Profit & Loss
Account. Privilege leave is accounted for accrual basis.
1.17 Taxation:
Income-tax expense comprises current tax and deferred tax charge or
credit. Tax on income for the current period is determined on financial
year basis computed in accordance with the provisions of the Income Tax
Act,1961 and based on expected outcome of assessment/appeal.
Minimum Alternative Tax (MAT) paid in accordance to the tax laws, which
gives rise to the future economic benefits in the form of adjustment of
future income tax liability, is considered as an asset if there is
convincing evidence that the Company will pay normal income tax after
the tax holiday period. Accordingly, MAT is recognised as an asset as
MAT Credit Entitlement in the balance sheet when it is probable that the
future economic benefit associated with it will flow to the Company and
the asset can be measured reliably.
1.18 Deferred Taxation:
The deferred tax charge or credit is recognised using current tax
rates. Where there is unabsorbed depreciation or carry forward losses,
deferred tax assets are recognised only if there is virtual certainty
of realisation of such assets. Other deferred tax assets are recognised
only to the extent there is reasonable certainty of realisation in
future. Deferred tax assets/ liabilities are reviewed as at each
Balance Sheet date based on development during the year and available
case laws, to reassess realisation/liabilities.
1.19 Investment:
Investments are stated at cost. Diminution in the value, if any, which
is of permanent nature is provided for.
Mar 31, 2010
A. : ACCOUNTING CONVENTION :
The Financial Statements are prepared under historical cost convention
on accrual basis in accordance with the generally accepted accounting
principles in India and the provisions of the Companies Act, 1956 as
adopted consistently by the company.
B. : USE OF ESTIMATES :
The preparation of financial statements in confirmity with generally
accepted accounting principles requires managements to make estimates
and assumptions that affect the reported amounts of assets &
liabilities and disclosures of contingent liabilities at the date of
financial statements and the results of operation during the reporting
period. Although these estimates are based upon managements best
knowledge of current events and actions, actual results could differ
from these estimates.
C. : FIXED ASSETS :
i. The Gross Block of fixed assets are shown at cost which includes
taxes, duties and preoperative expenses.Cost of Fixed Assets has been
reduced to the extent of Excise Duty under Capital Cenvat Scheme,
Service Tax & VAT where such credit is availed.
ii. Capital work in progress is shown at cost and includes the amount
of capital work in progress,advances for capital goods.
iii. All the preoperative expenditure including interest on borrowing
for the project/ item, incurred on capital work in progress or on fixed
assets upto the date of installation of the individual item as taken by
the company is capitalized and added on pro-rata basis to the cost of
respective fixed Assets.
D. : DEPRECIATION:
The company provides depreciation on Straight Line method on (a) Plant
and Machinery and (b) Vehicles, whereas on (a) Building (b) Furniture
and Fixtures and (c) computer, depreciation is provided on Written Down
Value Method,at the rates and manner specified in Schedule XIV of the
Companies Act, 1956.
E. : INVENTORIES :
Raw materials,Work in Progress and finished goods are valued at lower
of cost or net realisable value.Stores & spare parts are stated at
cost. Cost comprise all cost of purchase, cost of conversion and other
costs incurred in bringing the inventories to their present location
and condition. Cost formulae used is First-in-First-Out method .
F. : SALES :
Sales includes sales value of goods, Excise duty but excludes VAT/CST,
trade discount & other taxes and material returned/ rejected and the
Operational income includes job charges income.
G. : RAW MATERIAL CONSUMPTION :
Raw Material Consumed includes interest expenses for late payment to
suppliers. H. : EXCISE / CUSTOM DUTIES:
Excise Duty on manufactured goods remaining in the inventory is
included as a part of valuation of finished goods. The customs
duty on raw materials, stores, spares & components is accounted on
clearance thereof. I. : FOREIGN CURRENCY TRANSACTIONS :
(a) Foreign currency transaction are accounted at the exchange rate
prevailing on the date of transaction. Monetary items related to
foreign currency transaction remaining unsettled at the end of the year
are translated at year end rates. Any exchange gain or loss arising out
of the subsequent fluctuation are accounted for in the Profit and Loss
Account.
(b) In respect of forward contracts assigned to the foreign currency
assets/liabilities as at Balance Sheet date, the proportionate
premium/discount for the period up to the date of Balance sheet is
recognized in the Profit and Loss account. The exchange difference
measured by the exchange rate between the inception of the forward
contract and date of balance sheet is applied on foreign currency
amount of the forward contract.
J. : TREATMENT OF RETIREMENT BENEFITS :
Company contributes to group gratuity policy with Life Insurance
Corporation of India as per actuarial valuation as on the Balance Sheet
date for future payment of Gratuity to employees. Companys
contributions paid/payable during the year to Provident Fund are
charged to the Profit & Loss Account.Privilege leave is accounted for
accrual basis.
K . : DEFERRED REVENUE EXPENSES AND PUBLIC ISSUE EXPENSES :
Public Issue Expenses and Preliminary expenses are amortized over a
period of 5 years.
L. : BORROWING COSTS:
Borrowing Costs that are directly attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. Exchange difference arising from foreign currency term
loan borrowing beyond adjustment to interest cost is capitalized as
part of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
M. : TAXATION:
Income-tax expense comprises current tax and deferred tax charge or
credit. Tax on income for the current period is determined on financial
year basis computed in accordance with the provisions of the Income Tax
Act,1961 and based on expected outcome of assessment/appeal.
N. : DEFERRED TAXATION:
The deferred tax charge or credit is recognised using current tax
rates. Where there is unabsorbed depreciation or carry forward losses,
deferred tax assets are recognised only if there is virtual certanity
of realisation of such assets. Other deferred tax assets are recognised
only to the extent there is reasonable certanity of realisation in
future. Deferred tax assets/ liabilities are reviewed as at each
Balance Sheet date based on development during the year and available
case laws, to reassess realisation/liabilities.
O. : INVESTMENT:
Investments are stated at cost. Dimunition in the value, if any, which
is of permanent nature is provided for.
P. : IMPAIRMENT OF ASSETS:
The Company assesses at each Balance Sheet date whether there is any
indication that an asset may be impaired. If any such indication
exists,the Company estimates the recoverable amount of the assets. If
such recoverable amount of the assets is less than its carrying amount,
the carrying amount is reduced to its recoverable amount. The reduction
is treated as an impairment loss and is recognized in the Profit and
Loss account. If at the Balance Sheet date there is an indication that
if a previously assessed impairment loss no longer exists, the
recoverable amount is reassessed and the asset is reflected at the
recoverable amount subject to a maximum of depreciated historical cost.
Q. : PROVISION AND CONTINGENT LIABILITIES :
(a) Provisions are recognized when the present obligation of a past
event gives rise to a probable outflow, embodying economic benefits on
settlement, and the amount of obligation can be reliably estimated.
(b) Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved.
(c) Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates. R. :
Accounting policies not specifically referred to are consistent with
generally accepted accounting practices.