Mar 31, 2016
NOTE 1 SIGNIFICANT ACCOUNTING POLICIES 1.1 Basis of preparation of Financial Statements
(a) The Financial Statements have been prepared to comply in all material respects with the mandatory Accounting Standards notified by Companies (Accounts) Rules, 2014 (as amended) 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 accounting principles generally accepted in India. The accounting policies have been consistently applied by the Company.
(b) All assets and liabilities have been classified as current or non-current wherever applicable as per the Company''s normal operating cycle and other criteria set out in the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.
(c) Transactions and balances with values below the rounding off norm adopted by the Company have been reflected as "0.00" in the relevant notes in these Financial Statements.
1.2 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 and liabilities and disclosure of contingent liabilities as at the date of the Financial Statements and the results of operations during the reporting period. Although these estimates are based upon management''s best knowledge of current events, plans and actions, actual results could differ from these estimates. Any revision to accounting estimates and assumption are recognized prospectively.
1.3 Revenue Recognition
(a) Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.
(b) Sales are recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are inclusive of excise duty but net of trade discounts and VAT. However, excise duty relating to sales is reduced from gross turnover for disclosing net turnover. Domestic sales are recognized at the time of dispatch of materials to the buyer. Export sales are recognized on the issue of bill of lading.
(c) Export Incentives arising out of Export Sales are accounted for on accrual basis.
(d) Purchases are inclusive of freight and net of CENVAT/VAT Credit, Trade Discount and Claims.
(e) Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
1.4 Tangible Assets & Capital Work-In-Progress
Tangible assets are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price (net of CENVAT/duty credits availed or available thereon) and any attributable/allocable cost of bringing the asset to its working condition for its intended use. The cost also includes direct cost and other related incidental expenses.
Costs of the tangible assets not ready for their intended use at the Balance Sheet date together with all related expenses are shown as Capital Work-in-Progress.
1.5 Depreciation and Amortization
(a) Depreciation is provided pro-rated to the period of use on Straight-Line Method (S.L.M.) based on the estimated useful lives of the assets, which have been determined, as per Part C of Schedule -II of the Companies Act, 2013, except in respect of the following assets, where useful life which is different than those prescribed under the Act.
For these classes of assets, based on internal assessment and independent technical evaluation carried out by external values, the useful lives as given above best represent the period over which Management expects to use these assets. Depreciation and amortization methods, useful lives and residual values are reviewed periodically, including at each financial year end.
b) Assets individually costing less than Rs. 5, 000/- are fully depreciated in the year of acquisition.
1.6 Investments
Long-Term Investments are stated at cost. Provision for diminution in the value of Long-Term Investments is made only if such a decline is other than temporary in nature.
On initial recognition, all investments are measure at cost. The cost comprise purchase price and directly attributable acquisition charges such as brokerage, fees and duties.
On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of Profit and Loss.
1.7 Inventories
Inventories are valued at lower of cost and net realizable value. Cost of inventories comprise material cost on FIFO basis, labour and manufacturing overheads incurred in bringing the inventories to their present location and condition. Cost of finished goods includes excise duty.
The cost of Work-In-Progress and finished goods includes the cost of labour, material and a proportion of manufacturing overheads.
1.8 Foreign Currency Transactions
(a) Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.
(b) Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in foreign currency are reported using the exchange rate at the date of the transaction.
(c) Exchange Differences
Exchange differences arising on the settlement of monetary items are recognized as income or as expense in the year in which they arise.
(d) Forward Exchange Contracts
Forward Exchange Contracts outstanding as at the year end on account of firm commitment transactions are translated at period end exchange rates and the resultant gains and losses as well as the gains and losses on cancellation of such contracts are recognized in the Statement of Profit and Loss.
1.9 Derivative Instruments and Hedging
The Company enters into derivative financial instruments to hedge foreign currency risk of firm commitments and highly probable forecast transactions. All derivative contracts outstanding at the period end are marked to market. The Company has applied the hedge accounting principles set out in AS-30 "Financial Instruments:
Recognition and Measurement" The method of recognizing the resultant gain or loss depends on whether the derivative is designated as hedging instrument. The gains or losses on designated hedging instruments that qualify as effective hedges are recorded in the Hedging Reserve Account and are recognized in the Statement of Profit and Loss in the period during which the underlying forecasted transactions occur. Gains or Losses on the ineffective transactions are immediately recognized in the Statement of Profit and Loss. When a forecasted transaction is no longer expected to occur, the gains and losses that were previously recognized in the Hedging Reserve are transferred to the Statement of Profit and Loss immediately.
1.10 Government Grants
Government grants are recognized when there is a reasonable assurance that the Company will comply with the conditions attached thereto and the grants will be received.
Government grants in the form of promoters'' contribution are credited to capital reserve. Capital grants relating to specific assets are reduced from the gross value of the respective fixed assets. Government grants related to revenue are recognized by credit over the period to match them on a systematic basis to the costs, which it intended to compensate.
1.11 Impairment of Assets
The Company identifies impair able assets based on cash generating unit concept at the yearend for the purpose of arriving at impairment loss thereon, if any, being the difference between the book value and recoverable value of the relevant asset. Impairment loss when crystallizes is charged against revenue of the year.
1.12 Employee Benefits
(a) Defined Contribution Plan:
Contributions as per the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 towards provident fund and family pension fund are charged to the Statement of Profit and Loss for the year when the contributions to the respective funds are due. There is no other obligation other than the contribution payable to the respective funds.
(b) Defined Benefit Plan:
Liability with regard to Long-Term employee benefits is provided for on the basis of an actuarial valuation at the Balance Sheet date. Actuarial gain/loss is recognized immediately in the statement of Profit and Loss. The Company has an Employees Gratuity Fund managed by the Life Insurance Corporation of India.
(c) Short-Term Compensated Absences are provided for based on estimates.
1.13 Research & Development Expenses
Revenue expenditure on Research and Development is charged as an expense through the normal heads of account in the year in which the same is incurred. Capital expenditure incurred on equipment and facilities that are acquired for research and development activities is capitalized and is depreciated according to the policies followed by the Company.
1.14 Borrowing Costs
(a) Borrowing costs include exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to interest costs and are shown as "Applicable Net Gain/Loss in Foreign Currency Transactions and Translations" (under "Finance Costs").
(b) Borrowing costs that are directly attributable to the acquisition of qualifying assets are capitalised for the period until the asset is ready for its intended use. A qualifying asset is an asset that necessarily takes substantial period of time to get ready for its intended use.
(c) Other Borrowing costs are recognized as expense in the period in which they are incurred.
1.15 Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect expenditure incidental and related to construction/ implementation, interest on term loans to finance fixed assets and expenditure on start-up of the project are capitalised upto the date of commissioning of project to the cost of the respective assets.
1.16 Taxation
(a) Provision for Income Tax has been made by the Company as per the interpretation and expert advice received which is subject to assessment procedure under the Income Tax Act, 1961.
(b) Tax expense comprises of current tax and deferred tax.
(c) Current income tax is measured at the amount expected to be paid to the tax authorities, computed in accordance with the applicable tax rates and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, MAT credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period.
(d) Deferred Tax arising on account of "timing differences" and which are capable of reversal in one or more subsequent periods is recognized, using the tax rates and tax laws that are enacted or substantively enacted. Deferred tax asset is recognized only to the extent there is virtual certainty with respect to reversal of the same in future years as a matter of prudence.
1.17 Earnings per Share (EPS)
(a) Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of Equity Shares outstanding during the period.
(b) For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential Equity Shares.
1.18 Prior Period Items
Prior Period and Extraordinary items and Changes in Accounting Policies having material impact on the financial affairs of the Company are disclosed.
1.19 Provisions/Contingencies
(a) Provision involving substantial degree of estimation in measurements is recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources.
(b) Contingent Liabilities are shown by way of notes to the Accounts in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered not probable.
(c) A Contingent Asset is not recognized in the Accounts.
1.20 Preliminary & Share Issue Expenses
Share Issue expenses incurred during the year are adjusted with the balance available in Securities Premium in accordance with Section 52 of the Companies Act, 2013.
Mar 31, 2014
1 Basis of preparation of financial statements
(a) The financial statements are prepared in accordance with Generally
Accepted Accounting Principles (Indian GAAP) under the historical cost
convention on accrual basis and on principles of going concern. The
accounting policies are consistently applied by the Company.
(b) 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.
(c) All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI (Revised) to the Companies Act,
1956. Based on the nature of products and the time between the
acquisition of assets for processing and their realisation in cash and
cash equivalents, the Company has ascertained its operating cycle as 12
months for the purpose of current non- current classification of assets
and liabilities.
(d) The preparation of the financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between the actual results and estimates are recognised in
the period in which the results are known / materialize.
2 Revenue Recognition
(a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
(b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive
of excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
(c) Export Incentives arising out of Export Sales are accounted for on
accrual basis.
(d) Purchases are inclusive of freight and net of CENVAT / VAT Credit,
Trade Discount and Claims.
(e) Interest income is recognised on a time proportion basis taking
into account the amount outstanding and the rate applicable.
3 Fixed Assets
(a) Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price (net of
CENVAT / duty credits availed or available thereon) and any
attributable cost of bringing the asset to its working condition for
the intended use.
(b) Depreciation is provided using the Straight Line Method as per the
useful lives of the assets estimated by the management, or at the rates
prescribed under Schedule XIV of the Companies Act, 1956, whichever is
higher. No write off is made in respect of leasehold land as these are
long term leases.
(c) The carrying amounts of assets are reviewed at each balance sheet
date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever
the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount is the higher of the asset''s net selling price and
value in use, which is determined by the present value of the estimated
future cash flows.
(d) Cost of the fixed assets not ready for their intended use at the
Balance Sheet date together with all related expenses are shown as
Capital Work-in-Progress.
4 Investments
Investments classified as long-term investments are stated at cost.
Provision is made to recognise any diminution other than temporary in
the value of such investments. Current investments are carried at lower
of cost and fair value.
5 Inventories
Inventories are valued at lower of cost and net realisable value. Cost
of inventories comprises material cost on FIFO basis, labour and
manufacturing overheads incurred in bringing the inventories to their
present location and condition. Cost of finished goods includes excise
duty.
6 Foreign Currency Transactions
(a) Initial Recognition :
Foreign currency transactions are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
(b) Conversion :
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are carried in terms of historical cost
denominated in foreign currency are reported using the exchange rate at
the date of the transaction.
(c) Exchange Differences :
Exchange differences arising on the settlement of monetary items are
recognised as income or as expense in the year in which they arise.
(d) Forward Exchange Contracts :
Forward Exchange Contracts (other than those entered into hedge foreign
currency risk of future transactions in respect of which firm
commitments are made or are highly probable forecast transactions) are
translated at period end exchange rates and the resultant gains and
losses as well as the gains and losses on cancellation of such
contracts are recognised in the Statement of Profit and Loss.
7 Derivative Instruments and Hedging
The Company enters into derivative financial instruments to hedge
foreign currency risk of firm commitments and highly probable forecast
transactions. All derivative contracts outstanding at the period end
are marked to market. The Company has applied the hedge accounting
principles set out in AS-30 "Financial Instruments : Recognition and
Measurement". The method of recognising the resultant gain or loss
depends on whether the derivative is designated as hedging instrument.
The gains or losses on designated hedging instruments that qualify as
effective hedges are recorded in the Hedging Reserve Account and are
recognised in the Statement of Profit and Loss in the period during
which the underlying forecasted transactions occur. Gains or losses on
the ineffective transactions are immediately recognised in the
Statement of Profit and Loss. When a forecasted transaction is no
longer expected to occur, the gains and losses that were previously
recognised in the Hedging Reserve are transferred to the Statement of
Profit and Loss immediately.
8 Government Grants
Government grants are recognised when there is a reasonable assurance
that the Company will comply with the conditions attached thereto and
the grants will be received.
Government grant in the form of promoters'' contribution is credited to
capital reserve. Capital grant relating to specific assets is reduced
from the gross value of the respective fixed assets. Government grants
related to revenue are recognised by credit over the period to match
them on a systematic basis to the costs, which it intended to
compensate.
9 Employee Benefits
(a) Defined Contribution Plan :
Contributions as per the Employees'' Provident Funds and Miscellaneous
Provisions Act, 1952 towards provident fund and family pension fund are
charged to the Statement of Profit and Loss for the year when the
contributions to the respective funds are due. There is no other
obligation other than the contribution payable to the respective funds.
(b) Defined Benefit Plan :
Liability with regard to long-term employee benefits is provided for on
the basis of an actuarial valuation at the Balance Sheet date.
Actuarial gain / loss is recognised immediately in the statement of
profit and loss. The Company has an Employees Gratuity Fund managed by
the Life Insurance Corporation of India.
(c) Short-term Compensated Absences are provided for based on
estimates.
10 Research & Development Expenses
Revenue expenditure on Research and Development is charged as an
expense through the normal heads of account in the year in which the
same is incurred. Capital expenditure incurred on equipment and
facilities that are acquired for research and development activities is
capitalized and is depreciated according to the policy followed by the
Company.
11 Borrowing Costs
(a) Borrowing costs include exchange differences arising from foreign
currency borrowings to the extent they are regarded as an adjustment to
interest costs and are shown as "Applicable Net Gain/Loss in Foreign
Currency Transactions and Translations" (under "Finance Costs").
(b) Borrowing costs that are directly attributable to the acquisition
of qualifying assets are capitalised for the period until the asset is
ready for its intended use. A qualifying asset is an asset that
necessarily takes substantial period of time to get ready for its
intended use.
(c) Other Borrowing costs are recognised as expense in the period in
which they are incurred.
12 Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect
expenditure incidental and related to construction/ implementation,
interest on term loans to finance fixed assets and expenditure on
start-up of the project are capitalised upto the date of commissioning
of project to the cost of the respective assets.
13 Taxes on Income
Tax expense comprises of current tax and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities, computed in accordance with the applicable tax rates
and tax laws. In case of tax payable as per provisions of MAT under
Section 115JB of the Income Tax Act, 1961, MAT credit is recognised as
an asset only when and to the extent there is convincing evidence that
the Company will pay normal income tax during the specified period.
Deferred Tax arising on account of "timing differences" and which are
capable of reversal in one or more subsequent periods is recognised,
using the tax rates and tax laws that are enacted or substantively
enacted. Deferred tax asset is recognised only to the extent there is
reasonable certainty with respect to reversal of the same in future
years as a matter of prudence.
14 Earnings per Share (EPS)
(a) Basic earnings per share is calculated by dividing the net profit
or loss for the period attributable to equity shareholders by the
weighted average number of Equity Shares outstanding during the period.
(b) For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential Equity Shares.
15 Prior Period Items
Prior Period and Extraordinary items and Changes in Accounting Policies
having material impact on the financial affairs of the Company are
disclosed.
16 Provisions / Contingencies
(a) Provision involving substantial degree of estimation in
measurements is recognised when there is a present obligation as a
result of past events and it is probable that there will be an outflow
of resources.
(b) Contingent Liabilities are shown by way of notes to the Accounts in
respect of obligations where, based on the evidence available, their
existence at the Balance Sheet date is considered not probable.
(c) A Contingent Asset is not recognised in the Accounts.
17 Preliminary & Share Issue Expenses
Share Issue expenses incurred during the year are adjusted with the
balance available in Securities Premium in accordance with Section 78
of the Companies Act, 1956.
Mar 31, 2013
1.1 Basis of preparation of financial statements
(a) The financial statements are prepared in accordance with Generally
Accepted Accounting Principles (Indian GAAP) under the historical cost
convention on accrual basis and on principles of going concern. The
accounting policies are consistently applied by the Company.
(b) 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.
(c) All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI (Revised) to the Companies Act,
1956. Based on the nature of products and the time between the
acquisition of assets for processing and their realisation in cash and
cash equivalents, the Company has ascertained its operating cycle as 12
months for the purpose of current- non current classification of assets
and liabilities.
(d) The preparation of the financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the Financial Statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between the actual results and estimates are recognised in
the period in which the results are known / materialise.
1.2 Revenue Recognition
(a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
(b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive
of excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
(c) Export Incentives arising out of Export Sales are accounted for on
accrual basis.
(d) Purchases are inclusive of freight and net of CENVAT / VAT Credit,
Trade Discount and Claims.
(e) Interest income is recognised on a time proportion basis taking
into account the amount outstanding and the rate applicable.
1.3 Fixed Assets
(a) Fixed Assets are stated at cost, less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price (net of
CENVAT / duty credits availed or available thereon) and any
attributable cost of bringing the asset to its working condition for
the intended use.
(b) Depreciation is provided using the Straight Line Method as per the
useful lives of the assets estimated by the management, or at the rates
prescribed under Schedule XIV of the Companies Act, 1956, whichever is
higher. No write off is made in respect of leasehold land as these are
long term leases.
(c) The carrying amounts of assets are reviewed at each balance sheet
date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever
the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount is the higher of the asset''s net selling price and
value in use, which is determined by the present value of the estimated
future cash flows.
(d) Cost of the fixed assets not ready for their intended use at the
Balance Sheet date together with all related expenses are shown as
Capital Work-in-Progress.
1.4 Investments
Investments classified as long-term investments are stated at cost.
Provision is made to recognise any diminution other than temporary in
the value of such investments. Current investments are carried at lower
of cost and fair value.
1.5 Inventories
Inventories are valued at lower of cost and net realisable value. Cost
of inventories comprises material cost on FIFO
basis, labour and manufacturing overheads incurred in bringing the
inventories to their present location and condition. Cost of finished
goods includes excise duty.
1.6 Foreign Currency Transactions
(a) Initial Recognition:
Foreign currency transactions are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
(b) Conversion:
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are carried in terms of historical cost
denominated in foreign currency are reported using the exchange rate at
the date of the transaction.
(c) Exchange Differences:
Exchange differences arising on the settlement of monetary items are
recognised as income or as expense in the year in which they arise.
(d) Forward Exchange Contracts:
Forward Exchange Contracts (other than those entered into to hedge
foreign currency risk of future transactions in respect of which firm
commitments are made or are highly probable forecast transactions) are
translated at period end exchange rates and the resultant gains and
losses as well as the gains and losses on cancellation of such
contracts are recognised in the Statement of Profit and Loss.
1.7 Derivative Instruments and Hedging
The Company enters into derivative financial instruments to hedge
foreign currency risk of firm commitments and highly probable forecast
transactions. All derivative contracts outstanding at the period end
are marked to market. The Company has applied the hedge accounting
principles set out in AS-30 "Financial Instruments : Recognition and
Measurement". The method of recognising the resultant gain or loss
depends on whether the derivative is designated as hedging instrument.
The gains or losses on designated hedging instruments that qualify as
effective hedges are recorded in the Hedging Reserve Account and are
recognised in the Statement of Profit and Loss in the period during
which the underlying forecasted transactions occur. Gains or losses on
the ineffective transactions are immediately recognised in the
Statement of Profit and Loss. When a forecasted transaction is no
longer expected to occur, the gains and losses that were previously
recognised in the Hedging Reserve are transferred to the Statement of
Profit and Loss immediately.
1.8 Government Grants
Government grants are recognised when there is a reasonable assurance
that the Company will comply with the conditions attached thereto and
the grants will be received.
Government grant in the form of promoters'' contribution is credited to
capital reserve. Capital grant relating to specific assets is reduced
from the gross value of the respective fixed assets. Government grants
related to revenue are recognised by credit over the period to match
them on a systematic basis to the costs, which it intended to
compensate.
1.9 Employee Benefits
(a) Defined Contribution Plan:
Contributions as per the Employees'' Provident Funds and Miscellaneous
Provisions Act, 1952 towards provident fund and family pension fund are
charged to the Statement of Profit and Loss for the year when the
contributions to the respective funds are due. There is no other
obligation other than the contribution payable to the respective funds.
(b) Defined Benefit Plan:
Liability with regard to long-term employee benefits is provided for on
the basis of an actuarial valuation at the Balance Sheet date.
Actuarial gain / loss is recognised immediately in the Statement of
Profit and Loss. The Company has an Employees Gratuity Fund managed by
the Life Insurance Corporation of India.
(c) Short-term Compensated Absences are provided for based on
estimates.
1.10 Research & Development Expenses
Revenue expenditure on Research and Development is charged as an
expense through the normal heads of account in the year in which the
same is incurred. Capital expenditure incurred on equipment and
facilities that are acquired for research and development activities is
capitalised and is depreciated according to the policy followed by the
Company.
1.11 Borrowing Costs
(a) Borrowing costs include exchange differences arising from foreign
currency borrowings to the extent they are regarded as an adjustment to
interest costs and are shown as "Applicable Net Gain/Loss in Foreign
Currency Transactions and Translations" (under "Finance Costs").
(b) Borrowing costs that are directly attributable to the acquisition
of qualifying assets are capitalised for the period until the asset is
ready for its intended use. A qualifying asset is an asset that
necessarily takes substantial period of time to get ready for its
intended use.
(c) Other Borrowing costs are recognised as expense in the period in
which they are incurred.
1.12 Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect
expenditure incidental and related to construction/ implementation,
interest on term loans to finance fixed assets and expenditure on
start-upof the projectare capitalised upto the date of commissioning of
project to the cost of the respective assets.
1.13 Taxes on Income
Tax expense comprises of current tax and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities, computed in accordance with the applicable tax rates
and tax laws. In case of tax payable as per provisions of MAT under
Section 115JB of the Income Tax Act, 1961, MAT credit is recognised as
an asset only when and to the extent there is convincing evidence that
the Company will pay normal income tax during the specified period.
Deferred Tax arising on account of "timing differences" and which are
capable of reversal in one or more subsequent periods is recognised,
using the tax rates and tax laws that are enacted or substantively
enacted. Deferred Tax Asset is recognised only to the extent there is
reasonable certainty with respect to reversal of the same in future
years as a matter of prudence.
1.14 Earnings per Share (EPS)
(a) Basic earnings per share is calculated by dividing the net profit
or loss for the period attributable to equity shareholders by the
weighted average number of Equity Shares outstanding during the period.
(b) For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential Equity Shares.
1.15 Prior Period Items
Prior Period and Extraordinary items and Changes in Accounting Policies
having material impact on the financial affairs of the Companyare
disclosed.
1.16 Provisions /Contingencies
(a) Provision involving substantial degree of estimation in
measurements is recognised when there is a present obligation as a
result of past events and it is probable that there will be an outflow
of resources.
(b) Contingent Liabilities are shown by way of notes to the Accounts in
respect of obligations where, based on the evidence available, their
existence at the Balance Sheet date is considered not probable.
(c) A Contingent Asset is not recognised in the Accounts.
1.17 Preliminary & Share Issue Expenses
Share Issue expenses incurred during the year are adjusted with the
balance available in Securities Premium in accordance with Section 78
of the Companies Act, 1956.
Mar 31, 2012
1.1 Basis of preparation of financial statements
(a) The financial statements are prepared in accordance with Generally
Accepted Accounting Principles (Indian GAAP) under the historical cost
convention on accrual basis and on principles of going concern. The
accounting polices are consistently applied by the Company.
(b) 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.
(c) During the year ended 31st March, 2012, the revised Schedule VI
notified under the Companies Act, 1956, has become applicable to the
Company, for preparation and presentation of its financial statements.
The adoption of revised Schedule VI does not impact recognition and
measurement principles followed in preparation of financial statements.
The Company has reclassified the previous year figures in accordance
with the requirements applicable in the current year.
(d) All assets and liabilities have been classified as current or
non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule VI (Revised) to the Companies Act,
1956. Based on the nature of products and the time between the
acquisition of assets for processing and their realisation in cash and
cash equivalents, the Company has ascertained its operating cycle as 12
months for the purpose of current-non current classification of assets
and liabilities.
(e) The preparation of the financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between the actual results and estimates are recognised in
the period in which the results are known/materialize.
1.2 Revenue Recognition
(a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
(b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive of
excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
(c) Export Incentives arising out of Export Sales are accounted for on
accrual basis.
(d) Purchases are inclusive of freight and net of CENVAT/VAT Credit,
Trade Discount and Claims.
(e) Interest income is recognised on a time proportion basis taking
into account the amount outstanding and the rate applicable.
1.3 Fixed Assets
(a) Fixed Assets are stated at cost, less accumulated deprecation and
impairment losses, if any. Cost comprises the purchase price (net of
CENVAT/duty credits availed or available thereon) and any attributable
cost of bringing the asset to its working condition for the intended
use.
(b) Deprecation is provided using the Straight Line Method as per the
useful lives of the assets estimated by the management, or at the rates
prescribed under Schedule XIV of the Companies Act, 1956, whichever is
higher. No write off is made in respect of leasehold land as these are
long term leases.
(c) The carrying amounts of assets are reviewed at each Balance Sheet
date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever
the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount is the higher of the assets net selling price and
value in use, which is determined by the present value of the estimated
future cash flows.
(d) Cost of the fixed assets not ready for their intended use at the
Balance Sheet date together with all related expenses are shown as
Capital Work-in-Progress.
1.4 Investments
Investments classified as long-term investments are stated at cost.
Provision is made to recognise any diminution other than temporary in
the value of such investments. Current investments are earned at lower
of cost and fair value.
1.5 Inventories
Inventories are valued at lower of cost and net realisable value. Cost
of inventories comprises material cost on FIFO basis, labour and
manufacturing overheads incurred in bringing the inventories to their
present location and condition. Cost of finished goods includes excise
duty.
1.6 Foreign Currency Transactions
(a) Initial Recognition
Foreign currency transactions are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
(b) Conversion
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are earned in terms of historical cost
denominated in foreign currency are reported using the exchange rate at
the date of the transaction.
(c) Exchange Differences
Exchange differences arising on the settlement of monetary items are
recognised as income or as expense in the year in which they arise.
(d) Forward Exchange Contracts
The Company enters into Forward Exchange Contracts which are not
intended for trading or speculation purposes. The premium or discount
arising at the inception of Forward Exchange Contracts is amortised as
expense or income over the life of the contract. Exchange differences
on such contracts are recognised in the statement of profit and loss in
the year in which the exchange rates change. Any profit or loss arising
on cancellation or renewal of Forward Exchange Contract is recognised
as income or expense for the year.
1.7 Derivative Instruments
The Company has entered into forward contracts to hedge a firm
commitment or a highly probable forecast transaction to which
Accounting Standard (AS) 11 is not applicable. The Company has applied
announcement of The Institute of Chartered Accountants of India on
Accounting for Derivatives' inter alia requiring provision for losses
on all derivative contracts outstanding at the Balance Sheet date by
marking them to market keeping in view the principle of prudence.
1.8 Government Grants
Government grants are recognized when there is a reasonable assurance
that the Company will comply with the conditions attached thereto and
the grants will be received. Government grant in the form of promoters'
contribution is credited to capital reserve. Capital grant relating to
specific assets is reduced from the gross value of the respective fixed
assets. Government grants related to revenue are recognized by credit
over the period to match them on a systematic basis to the costs, which
it intended to compensate.
1.9 Employee Benefits
(a) Defined Contribution Plan :
Contributions as per the Employees' Provident Funds and Miscellaneous
Provisions Act, 1952 towards provident fund and family pension fund are
charged to the Statement of Profit and Loss for the year when the
contributions to the respective funds are due. There is no other
obligation other than the contribution payable to the respective funds.
(b) Defined Benefit Plan :
Liability with regard to long-term employee benefits is provided for on
the basis of an actuarial valuation at the Balance Sheet date.
Actuarial gain/loss is recognised immediately in the statement of profit
and loss. The Company has an Employees Gratuity Fund managed by the
Life Insurance Corporation of India.
(c) Short-term Compensated Absences are provided for based on
estimates.
1.10 Research & Development Expenses
Revenue expenditure on Research and Development is charged as an
expense through the normal heads of account in the year in which the
same is incurred. Capital expenditure incurred on equipment and
facilities that are acquired for research and development activities ,s
capitalised and is depreciated according to the policy followed by the
Company.
1.11 Borrowing Costs
(a) Borrowing costs include exchange differences arising from foreign
currency borrowings to the extent they are regarded as an adjustment to
interest costs and are shown as "Applicable Net Gam/Loss in Foreign
Currency Transactions and Translations" (under "Finance Costs").
(b) Borrowing costs that are directly attributable to the acquisition
of qualifying assets are capitalised for the period until the asset is
ready for its intended use. A qualifying asset is an asset that
necessarily takes substantial period of time to get ready for its
intended use.
(c) Other Borrowing costs are recognised as expense in the period in
which they are incurred.
1.12 Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect
expenditure incidental and related to construction/implementation,
interest on term loans to finance fixed assets and expenditure on
start-up of the project are capitalised upto the date of commissioning
of project to the cost of the respective assets.
1.13 Taxes on Income
Tax expense comprises of current tax and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities, computed in accordance with the applicable tax rates
and tax laws. In case of tax payable as per provisions of MAT under
Section 115JB of the Income Tax Act, 1961, MAT credit is recognised as
an asset only when and to the extent there is convincing evidence that
the Company will pay normal income tax during the specified period.
Deferred Tax arising on account of "timing differences" and which are
capable of reversal in one or more subsequent periods is recognised,
using the tax rates and tax laws that are enacted or substantively
enacted. Deferred tax asset is recognised only to the extent there is
reasonable certainty with respect to reversal of the same in future
years as a matter of prudence.
1.14 Earnings per Share (EPS)
(a) Basic earnings per share is calculated by dividing the net profit
or loss for the period attributable to equity shareholders by the
weighted average number of Equity Shares outstanding during the period.
(b) For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
1.15 Prior Period Items
Prior Period and Extraordinary items and Changes in Accounting Polices
having material impact on the financial affairs of the Company are
disclosed.
1.16 Provisions/Contingencies
(a) Provision involving substantial degree of estimation in
measurements is recognized when there is a present obligation as a
result of past events and it is probable that there will be an outflow
of resources.
(b) Contingent Liabilities are shown by way of notes to the Accounts in
respect of obligations where, based on the evidence available, their
existence at the Balance Sheet date is considered not probable.
(c) A Contingent Asset is not recognized in the Accounts.
1.17 Preliminary & Share Issue Expenses
Share Issue expenses incurred during the year are adjusted with the
balance available in Securities Premium in accordance with Section 78
of the Companies Act, 1956.
Mar 31, 2011
1. Basis of preparation of financial statements
a) The financial statements are prepared in accordance with Generally
Accepted Accounting Principles (Indian GAAP) under the historical cost
convention on accrual basis and on principles of going concern. The
accounting policies are consistently applied by the Company.
b) 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.
c) The preparation of the financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between the actual results and estimates are recognised in
the period in which the results are known/materialised.
2. Revenue Recognition
a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive of
excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
c) Export incentives arising out of Export Sales are accounted for on
accrual basis.
d) Purchases are net of CENVAT/VAT credit, Trade Discounts and claims.
e) Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
3. Fixed Assets
a) Fixed Assets are stated at cost, less accummulated depreciation and
impairment losses, if any. Cost comprises the purchase price (net of
CENVAT/duty credits availed or available thereon) and any attributable
cost of bringing the asset to its working condition for the intended
use.
b) Depreciation is provided using the Straight Line Method as per the
useful lives of the assets estimated by the management, or at the rates
prescribed under Schedule XIV of the Companies Act, 1956, whichever is
higher. No write off is made in respect of leasehold land as these are
long term leases.
c) The carrying amounts of assets are reviewed at each Balance Sheet
date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever
the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount is the higher of the asset's net selling price and
value in use, which is determined by the present value of the estimated
future cash flows.
d) Cost of the fixed assets not ready for their intended use at the
Balance Sheet date together with all related expenses are shown as
Capital Work-in-Progress.
4. Investments
Investments classified as long-term investments are stated at cost.
Provision is made to recognise any diminution other than temporary in
the value of such investments. Current investments are carried at lower
of cost and fair value.
5. Inventories
Inventories are valued at lower of cost and net realisable value. Cost
of inventories comprises material cost on FIFO basis, labour and
manufacturing overheads incurred in bringing the inventories to their
present location and condition. Cost of finished goods includes excise
duty.
6. Foreign Currency Transactions
i) Initial Recognition
Foreign currency transcations are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
ii) Conversion
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are carried in terms of historical cost
denominated in a foreign currency are reported using the exchange rate
at the date of the transaction.
iii) Exchange Differences
Exchange differences arising on the settlement of monetary items are
recognised as income or as expense in the year in which they arise.
iv) Forward Exchange Contracts
The Company enters into Forward Exchange Contracts which are not
intended for trading or speculation purposes. The premium or discount
arising at the inception of forward exchange contracts is amortised as
expense or income over the life of the contract. Exchange differences
on such contracts are recognised in the statement of profit and loss in
the year in which the exchange rates change. Any profit or loss arising
on cancellation or renewal of forward exchange contract is recognised
as income or expense for the year.
7. Derivative Instruments
The Company has entered into forward contracts to hedge a firm
commitment or a highly probable forecast transaction to which
Accounting Standard (AS) 11 is not applicable. The Company has applied
announcement of The Institute of Chartered Accountants of India on
'Accounting for Derivatives' inter alia requiring provision for losses
on all derivative contracts outstanding at the Balance Sheet date by
marking them to market keeping in view the principle of prudence.
8. Government Grants
Government grants are recognised when there is a reasonable assurance
that the Company will comply with the conditions attached thereto and
the grants will be received.
Government grant in the form of promoters' contribution is credited to
capital reserve. Capital grant relating to specific assets is reduced
from the gross value of the respective fixed assets. Government grants
related to revenue are recognised by credit over the period to match
them on a systematic basis to the costs, which it intended to
compensate.
9. Employee Benefits
a) Defined Contribution Plan
Contributions as per the Employees' Provident Funds and Miscellaneous
Provisions Act, 1952 towards provident fund and family pension fund are
charged to the Profit and Loss Account of the year when the
contributions to the respective funds are due. There is no other
obligation other than the contribution payable to the respective funds.
b) Defined Benefit Plan
Liability with regard to long-term employee benefits is provided for on
the basis of an actuarial valuation at the Balance Sheet date.
Actuarial gain/loss is recognised immediately in the statement of
profit and loss. The Company has an Employees Gratuity Fund managed by
the Life Insurance Corporation of India.
c) Short-term Compensated Absences are provided for based on estimates.
10. Research & Development Expenses
Revenue expenditure on Research and Development is charged as an
expense through the normal heads of account in the year in which the
same is incurred. Capital expenditure incurred on equipment and
facilities that are acquired for research and development activities is
capitalised and is depreciated according to the policy followed by the
Company.
11. Borrowing Costs
a) Borrowing costs that are directly attributable to the acquisition of
qualifying assets are capitalised for the period untill the asset is
ready for its intended use. A qualifying asset is an asset that
necessarily takes substantial period of time to get ready for its
intended use.
b) Other Borrowing costs are recognised as expense in the period in
which they are incurred.
12. Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect
expenditure incidental and related to construction/implementation,
interest on term loans to finance fixed assets and expenditure on
start-up of the project are capitalised upto the date of commissionig
of project to the cost of the respective assets.
13. Taxes on Income
Tax expense comprises of current tax and deferred tax.
a) Current income tax is measured at the amount expected to be paid to
the tax authorities, computed in accordance with the applicable tax
rates and tax laws. In case of tax payable as per provisions of MAT
under Section 115JB of the Income Tax Act, 1961, MAT credit is
recognised as an asset only when and to the extent there is convincing
evidence that the Company will pay normal income tax during the
specified period.
b) Deferred Tax arising on account of "timing differences" and which
are capable of reversal in one or more subsequent periods is
recognised, using the tax rates and tax laws that are enacted or
substantively enacted. Deferred tax asset is recognised only to the
extent there is reasonable certainty with respect to reversal of the
same in future years as a matter of prudence.
14. Earnings per Share (EPS)
a) Basic earnings per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
b) For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
15. Provisions & Contingent Liabilities
Provision involving substantial degree of estimation in measurements is
recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are shown by way of notes to the Accounts in
respect of obligations where, based on the evidence available, their
existence at the Balance Sheet date is considered not probable.
A Contingent Asset is not recognised in the Accounts.
16. Share Issue Expenses
Share Issue expenses incurred in earlier years are being amortised over
a period of 5 years under Section 35D of the Income Tax Act, 1961.
Share Issue expenses incurred during the year are adjusted with the
balance available in Securities Premium in accordance with Section 78
of the Companies Act, 1956.
17. Prior Period Items
Prior period and extraordinary items and changes in accounting policies
having material impact on the financial affairs of the Company are
disclosed.
Mar 31, 2010
1. Basis of preparation of financial statements
a) The financial statements are prepared in accordance with Generally
Accepted Accounting Principles (Indian GAAP) under the historical cost
convention on accrual basis and on principles of going concern. The
accounting policies are consistently applied by the Company.
b) 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.
c) The preparation of the financial statements requires estimates and
assumptions to be made that affect the reported amounts of assets and
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.
Differences between the actual results and estimates are recognised in
the period in which the results are known/materialised.
2. Revenue Recognition
a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive of
excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
c) Export incentives arising out of Export Sales are accounted for on
accrual basis.
d) Purchases are net of CENVAT/VAT credit, Trade Discounts and claims.
e) Interest Income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
3. Fixed Assets
a) Fixed Assets are stated at cost, less accummulated depreciation and
impairment losses, if any. Cost comprises the purchase price (net of
CENVAT/duty credits availed or available thereon) and any attributable
cost of bringing the asset to its working condition for the intended
use.
b) Depreciation is provided using the Straight Line Method as per the
useful lives of the assets estimated by the management, or at the rates
prescribed under Schedule XIV of the Companies Act, 1956 whichever is
higher. No write off is made in respect of leasehold land as these are
long term leases.
c) The carrying amounts of assets are reviewed at each Balance Sheet
date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever
the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount is the higher of the assets net selling price and
value in use, which is determined by the present value of the estimated
future cashflows.
d) Cost of the fixed assets not ready for their intended use at the
Balance Sheet date together with all related expenses are shown as
Capital Work-in-Progress.
4. Investments
Investments classified as long-term investments are stated at cost.
Provision is made to recognise any diminution other than temporary in
the value of such investments. Current Investments are carried at lower
of cost and fair value.
5. Inventories
Inventories are valued at lower of cost and net realisable value. Cost
of inventories comprises material cost on FIFO basis, labour and
manufacturing overheads incurred in bringing the inventories to their
present location and condition. Cost of finished goods includes excise
duty.
6. Foreign Currency Transactions
i) Initial Recognition
Foreign Currency Transcations are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
ii) Conversion
Foreign currency monetary items are reported using the closing rate.
Non-monetary items which are carried in terms of historical cost
denominated in a foreign currency are reported using the exchange rate
at the date of the transaction.
iii) Exchange Differences
Exchange differences arising on the settlement of monetary items are
recognised as income or as expense in the year in which they arise.
iv) Forward Exchange Contracts
The Company enters into Forward Exchange Contracts which are not
intended for trading or speculation purposes. The premium or discount
arising at the inception of forward exchange contracts is amortised as
expense or income over the life of the contract. Exchange differences
on such contracts are recognised in the statement of profit & loss in
the year in which the exchange rates change. Any profit or loss arising
on cancellation or renewal of forward exchange contract is recognised
as income or expense for the year.
7. Derivative Instruments
The Company has entered into forward contracts to hedge a firm
commitment or a highly probable forecast transaction to which
Accounting Standard (AS) 11 is not applicable. The Company has applied
announcement of The Institute of Chartered Accountants of India on
Accounting for Derivatives inter alia requiring provision for losses
on all derivative contracts outstanding at the Balance Sheet date by
marking them to market keeping in view the principle of prudence.
8. Government Grants
Government grants are recognized when there is a reasonable assurance
that the Company will comply with the conditions attached thereto and
the grants will be received.
Government grant in the form of promoters contribution is credited to
Capital Reserve. Capital grant relating to specific assets is reduced
from the gross value of the respective fixed assets. Government grants
related to revenue are recognized by credit over the period to match
them on a systematic basis to the costs, which it intended to
compensate.
9. Employee Benefits
a) Defined Contribution Plan
Contributions as per the Employees Provident Funds and Miscellaneous
Provisions Act, 1952 towards provident fund and family pension fund are
charged to the Profit & Loss Account of the year when the contributions
to the respective funds are due. There is no other obligation other
than the contribution payable to the respective funds.
b) Defined Benefit Plan
Liability with regard to long-term employee benefits is provided for on
the basis of an actuarial valuation at the Balance Sheet date.
Actuarial gain / loss is recognised immediately in the statement of
profit and loss. The Company has an Employees Gratuity Fund managed by
the Life Insurance Corporation of India.
c) Short-term Compensated Absences are provided for based on estimates.
10. Research & Development Expenses
Revenue expenditure on Research and Development is charged as an
expense through the normal heads of account in the year in which the
same is incurred. Capital expenditure incurred on equipment and
facilities that are acquired for research and development activities is
capitalized and is depreciated according to the policy followed by the
Company.
11. Borrowing Costs
a) Borrowing costs that are directly attributable to the acquisition of
qualifying assets are capitalised for the period untill the asset is
ready for its intended use. A qualifying asset is an asset that
necessarily takes substantial period of time to get ready for its
intended use.
b) Other Borrowing costs are recognised as expense in the period in
which they are incurred.
12. Expenditure on new projects & substantial expansion
Preliminary project expenditure, capital expenditure, indirect
expenditure incidental and related to construction/implementation,
interest on term loans to finance fixed assets and expenditure on
start-up of the project are capitalized upto the date of commissionig
of project to the cost of the respective assets.
13. Taxes on Income
Tax expense comprises of current tax, deferred tax and fringe benefit
tax.
a) Current income tax and fringe benefit tax is measured at the amount
expected to be paid to the tax authorities, computed in accordance with
the applicable tax rates and tax laws. In case of tax payable as per
provisions of MAT under Section 115JB of the Income Tax Act, 1961 MAT
Credit is recognised as an asset only when and to the extent there is
convincing evidence that the Company will pay normal income tax during
the specified period.
b) Deferred Tax arising on account of "timing differences" and which
are capable of reversal in one or more subsequent periods is
recognised, using the tax rates and tax laws that are enacted or
substantively enacted. Deferred tax asset is recognised only to the
extent there is reasonable certainty with respect to reversal of the
same in future years as a matter of prudence.
14. Earnings per Share (EPS)
a) Basic earnings per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
b) For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
15. Provisions & Contingent Liabilities
"Provision involving substantial degree of estimation in measurements
is recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are shown by way of notes to the Accounts in
respect of obligations where, based on the evidence available, their
existence at the Balance Sheet date is considered not probable.
A Contingent Asset is not recognized in the Accounts."
16. Share Issue Expenses
Share Issue Expenses are amortised over a period of 5 years under
Section 35D of the Income Tax Act, 1961.
17. Prior Period Items
Prior Period and Extraordinary items and Changes in Accounting Policies
having material impact on the financial affairs of the Company are
disclosed.