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Accounting Policies of Shree Cements Ltd. Company

Jun 30, 2015

I. Accounting Convention

The Financial statements of the Company are prepared under the historical cost convention using the accrual method of accounting and comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Company (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 unless stated otherwise hereinafter. Accounting Policies not specifically referred to, are consistent with Generally Accepted Accounting Principles in India.

II. 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 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 and actions, actual results could differ from these estimates.

III. Fixed Assets

Fixed assets (Tangible and Intangible) are disclosed at cost less accumulated depreciation/amortisation and impairment loss, if any. Cost comprises of purchase price and attributable cost of acquisition/bringing the asset to its working condition for its intended use (net of credit availed, if any) except free hold land not containing mineral reserves which is disclosed at cost less impairment loss, if any.

Gains or losses arising from derecognition of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the Statement of Profit and Loss when the asset is derecognised.

IV. Capital Work In Progress

a) Capital work in progress is carried at cost and Pre-operative expenditure during construction period which is allocated to the fixed assets on the completion of project.

b) Expenditures on construction of assets for Company's use at premises owned by Government/Local Authorities/others are charged to Statement of Profit and Loss in the year of expenditure.

V. Impairment of Assets

The carrying amount 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. An asset's recoverable amount is the higher of the asset's net selling price and value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm's length transaction between knowledgeable, willing parties, less the cost of disposal.

A previously recognised impairment loss is further provided or reversed depending on changes in circumstances.

VI. Depreciation and Amortisation Tangible Assets

a) Depreciation is provided on Written down Value method in accordance with the provisions of Schedule II to the Companies Act, 2013 or the rates prescribed in the Income Tax Act, 1961 and rules made thereunder, whichever is higher. However, in case of those assets whose WDV as per the Income Tax Act, 1961 is lower than the WDV as per books, additional depreciation is provided to align the Book WDV with WDV as per the Income Tax Act, 1961.

b) Leasehold land not containing mineral reserve is amortised over the period of lease.

c) Land bearing mineral reserves is amortised over its estimated commercial life based on the unit-of-production method. Intangible Assets

a) Expenditure on Computer Software is amortised in the year in which it is capitalised.

b) Amount paid for Mining rights is amortised in the year in which amount is paid.

c) Goodwill is amortised within one year.

VII. Foreign Currency Transactions

Foreign currency transactions are recorded by applying the exchange rates on the date of transaction.

At each Balance sheet date, foreign currency monetary items are reported using the closing rates. 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 transaction. Exchange difference arising on the settlement of monetary items or on reporting monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expense in the year in which they arise.

Derivative Instruments

Derivative financial instruments are used to hedge risk associated with foreign currency fluctuations and interest rates. The derivative contracts are closely linked with the underlying transactions and are intended to be held till maturity. These are accounted on the date of their settlement and realised gain/loss in respect of settled contracts is recognised in the Statement of Profit and Loss.

The premium or discount on forward exchange contracts is amortised over the life of the contract.

VIII. Investments

Investments, that are intended to be held for not more than one year, from the date of acquisition, are classified as current investments. All other investments are classified as long term investments.

Current Investments are carried at lower of cost or fair market value. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary.

IX. Inventories

a) Raw Materials, Stores & Spare Parts, Packing Materials and Fuel

These are valued at lower of cost and net realisable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on a weighted average basis.

b) Work-in-progress and Finished goods

These are valued at lower of cost and net realisable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of finished goods includes excise duty. Cost is determined on a weighted average basis.

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

X. Cash and Cash Equivalents

Cash and cash equivalents for the purpose of cash flow statement comprises cash on hand, balances with banks and fixed deposits with banks with an original maturity of three months or less.

XI. Revenue Recognition

Revenue is recognised to the extent it is probable that the economic benefit will flow to the Company and the revenue can be reliably measured

a) Revenue from sale of goods and power is recognised when significant risks and rewards of ownership is transferred to the buyer. Sales are disclosed net of sales tax / VAT, trade discounts and returns, as applicable.

b) Power supplied under banking arrangements is accounted for as per terms of related agreements. Quantity of power banked is recorded as loan transaction valued at cost or net realisable value, whichever is lower and recognised as revenue when the same is returned and sold to an ultimate customer.

c) Dividend income on investments is accounted for when the right to receive the payment is established.

d) Interest is recognised using the time-proportion method, based on rates implicit in the transaction.

e) Certain insurance, railway and other claims where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on acceptance basis.

XII. Government Grants/Subsidies

Government grants are recognised when there is reasonable assurance that the Company will comply with the conditions attached thereto and the grants will be received.

Government grants/subsidies, which are capital in nature, are credited to capital reserve.

Government grants related to revenue are recognised on a systematic basis in the Statement of Profit and Loss over the period to match them with the related costs.

XIII. Employee Benefits Defined Contribution Plan

Superannuation, Provident Fund and National Pension Scheme are considered as defined contribution plan and the contributions are charged to the Statement of Profit and Loss of the year in which the contributions to the respective funds are due.

Defined Benefit Plan

a) Gratuity is considered as defined benefit plan and is provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of the Balance Sheet.

b) Contribution to provident Fund set up by the Company in respect of a few employees is also defined benefit plan and contribution is charged to Statement of Profit and Loss of the year in which the contribution is due.

c) Encashable leave in case of employees covered by Cement Wage Board is considered as defined benefit plan and is accounted for on the basis of actuarial valuation, as at the Balance Sheet date.

Other Benefits

Non encashable leave are provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of Balance sheet.

Actuarial gains and losses, if any, are recognised in the Statement of Profit and Loss in the year in which they arise.

XIV. Operating Leases

Assets acquired under leases where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Lease rentals are charged to the Statement of Profit and Loss on a straight-line basis over the lease term.

XV. Borrowing Costs

Borrowing costs directly attributable to the acquisition / construction of a qualifying asset are capitalised as part of the cost of such asset till such time the asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

XVI. Research and Development

Expenditure on research phase is recognised as an expense when it is incurred. Expenditure on development phase which results in creation of assets is included in related Fixed Assets.

XVII. Mines Reclamation Expenditure

The Company provides for the expenditure to reclaim the quarries used for mining. The total estimate of reclamation expenses is apportioned over the estimate of mineral reserves and a provision is made based on the minerals extracted.

XVIII. Segment Reporting

Segment is identified and reported taking into account the nature of products and services, the different risks and returns and the internal business reporting systems. The identification of geographical segment is based on the areas in which major operating divisions of the Company operates.

Inter Segment Transfers are accounted for as if the sales or transfers were to third parties at market price.

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs. Assets, Liabilities, Revenue and Expenses which are not allocable to segments are included under "unallocated".

XIX. Taxation

Tax expenses comprises of Current and Deferred Tax.

Current Tax is measured on the basis of estimated taxable income computed in accordance with the provisions of the Income Tax Act, 1961. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax is recognised for all the timing differences. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961 based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each Balance sheet date.

XX. Provisions, Contingent Liabilities and Contingent Assets

Provisions in respect of present obligation arising out of past events are made in the accounts if it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

The contingent liabilities are disclosed, unless the possibility of outflow of resources is remote. Contingent Assets are generally neither recognised nor disclosed in the financial statements.

XXI. Earnings per Share

Basic earnings per share are 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.

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 equity shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.


Jun 30, 2014

I. Accounting Convention

The Financial statements of the Company are prepared under the historical cost convention using the accrual method of accounting and comply with the Accounting Standards notified in the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956, read with general circular No. 15/2013 dated 13.09.2013, issued by the Ministry of Corporate Affairs, in respect of section 133 of the Companies Act, 2013 unless stated otherwise hereinafter. Accounting Policies not specifically referred to, are consistent with Generally Accepted Accounting Principles in India.

II. 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 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 and actions, actual results could differ from these estimates.

III. Fixed Assets

Fixed assets are disclosed at cost less accumulated depreciation/amortization and impairment loss, if any. Cost comprises of purchase price and attributable cost of acquisition/bringing the asset to its working condition for its intended use (net of credit availed, if any) except free hold land not containing mineral reserves which is disclosed at cost less impairment loss, if any.

IV. Capital Work-in-Progress

a) Capital work-in-progress is carried at cost and Pre-operative expenditure during construction period which is allocated to the fixed assets on the completion of project.

b) Expenditures on construction of assets for Company''s use at premises owned by Government/ Local Authorities/others are charged to Statement of Profit and Loss in the year of expenditure.

V. Impairment of Assets

The carrying amount 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 recognized wherever the carrying amount of an asset exceeds its recoverable amount. An asset''s recoverable amount is the higher of the asset''s net selling price and value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arm''s length transaction between knowledgeable, willing parties, less the cost of disposal.

A previously recognized impairment loss is further provided or reversed depending on changes in circumstances.

VI. Depreciation and Amortization Tangible Assets

(a) Depreciation is provided on Written down Value method at the rates specified in Schedule XIV of the Companies Act, 1956 or the rates prescribed in the Income Tax Act, 1961, whichever is higher. However, in case of those assets whose WDV as per the Income Tax Act, 1961 is lower than the WDV as per books, additional depreciation is provided to align the Book WDV with WDV as per the Income Tax Act, 1961.

(b) Leasehold land not containing mineral reserve is amortized over the period of lease.

(c) Land bearing mineral reserves is amortized over its estimated commercial life based on the unit-of- production method.

Intangible Assets

(a) Expenditure on Computer Software is amortized in the year in which it is capitalized.

(b) Amount paid for Mining rights is amortized in the year in which amount is paid.

VII. Foreign Currency Transactions

Foreign currency transactions are recorded by applying the exchange rates on the date of transaction.

At each Balance sheet date, foreign currency monetary items are reported usingthe closing rates. 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 transaction.

Exchange difference arising on the settlement of monetary items or on reporting monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expense in the year in which they arise.

Derivative Instruments

Derivative financial instruments are used to hedge risk associated with foreign currency fluctuations and interest rates. The derivative contracts are closely linked with the underlying transactions and are intended to be held till maturity. These are accounted on the date of their settlement and realized gain/loss in respect of settled contracts is recognized in the Statement of Profit and Loss.

The premium or discount on forward exchange contracts is amortized over the life of the contract.

VIII. Investments

Investments, that are intended to be held for not more than one year, from the date of acquisition, are classified as current investments. All other investments are classified as long term investments/non-current investments.

Current Investments are carried at lower of cost or fair market value. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary.

IX. Inventories

a) Raw Materials, Stores & Spare Parts, Packing Materials and Fuel:

These are valued at lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on a weighted average basis.

b) Work-in-progress and Finished goods:

These are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of finished goods includes excise duty. Cost is determined on a weighted average basis.

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

X. Cash and Cash Equivalents

Cash and cash equivalents for the purpose of cash flow statement comprises cash on hand, balances with banks and fixed deposits with banks with an original maturity of three months or less.

XL Revenue Recognition

Revenue is recognized to the extent it is probable that the economic benefit will flow to the company and the revenue can be reliably measured

a) Revenue from sale of goods and power is recognized when significant risks and rewards of ownership is transferred to the buyer. Sales are disclosed net of sales tax / VAT, trade discounts and returns, as applicable.

b) Power supplied under banking arrangements is accounted for as per terms of related agreements. Quantity of power banked is recorded as loan transaction valued at cost or net realizable value, whichever is lower and recognized as revenue when the same is returned and sold to an ultimate customer.

c) Dividend income on investments is accounted for when the right to receive the payment is established.

d) Interest is recognized using the time-proportion method, based on rates implicit in the transaction.

e) Certain insurance, railway and other claims where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on acceptance basis.

XII. Government Grants/Subsidies

Government grants are recognized when there is reasonable assurance that the Company will comply with the conditions attached thereto and the grants will be received. Government grants/subsidies, which are capital in nature, are credited to capital reserve.

Government grants related to revenue are recognized on a systematic basis in the Statement of Profit and Loss over the period to match them with the related costs.

XIII. Employee Benefits Defined Contribution Plan

Superannuation, Provident Fund and National Pension Scheme are considered as defined contribution plan and the contributions are charged to the Statement of Profit and Loss of the year in which the contributions to the respective funds are due.

Defined Benefit Plan

a) Gratuity is considered as defined benefit plan and is provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of the Balance Sheet.

b) Contribution to provident Fund set up by the Company in respect of a few employees is also defined benefit plan and contribution is charged to Statement of Profit and Loss of the year in which the contribution is due.

c) Encashable leave in case of employees covered by Cement Wage Board is considered as defined benefit plan and is accounted for on the basis of actuarial valuation, as at the Balance Sheet date.

Other Benefits

Non-encashable leaves are provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of Balance sheet.

Actuarial gains and losses, if any, are recognized in the Statement of Profit and Loss in the year in which they arise.

XIV. Operating Leases

Assets acquired under leases where a significant portion of the risks and rewards of ownership are retained

by the lessor are classified as operating leases. Lease rentals are charged to the Statement of Profit and Loss on accrual basis.

XV. Borrowing Costs

Borrowing costs directly attributable to the acquisition / construction of a qualifying asset are capitalized as part of the cost of such asset till such time the asset is ready for its intended use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

XVI. Research and Development

Expenditure on research phase is recognized as an expense when it is incurred. Expenditure on development phase which results in creation of assets is included in related Fixed Assets.

XVII.Mines Reclamation Expenditure

The Company provides for the expenditure to reclaim the quarries used for mining. The total estimate of reclamation expenses is apportioned over the estimate of mineral reserves and a provision is made based on the minerals extracted.

XVIII. Segment Reporting

Segment is identified and reported taking into account the nature of products and services, the different risks and returns and the internal business reporting systems. The identification of geographical segment is based on the areas in which major operating divisions of the Company operates.

Inter Segment Transfers are accounted for as if the sales or transfers were to third parties at market price.

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

Assets, Liabilities, Revenue and Expenses which are not allocable to segments are included under "unallocated".

XIX. Taxation

Tax expense comprises of Current and Deferred Tax.

Current Tax is measured on the basis of estimated taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax is recognized for all the timing differences. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

Tax credit is recognized in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961 based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each Balance sheet date.

XX. Provisions, Contingent Liabilities and Contingent Assets

Provisions in respect of present obligation arising out of past events are made in the accounts if it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

The contingent liabilities are disclosed, unless the possibility of outflowof resources is remote. Contingent Assets are generally neither recognized nor disclosed in the financial statements.

XXI. Earnings per Share

Basic earnings per share are 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.

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 equity shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.


Jun 30, 2012

I. Accounting Convention

The Financial statements of the Company are prepared under the historical cost convention using the accrual method of accounting and comply with the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of Companies Act, 1956 unless stated otherwise hereinafter. Accounting Policies not specifically referred to, are consistent with Generally Accepted Accounting Principles.

During the period ended 30th June 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 for preparation of financial statements. However, it has significant impact on presentation and disclosure made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

II. 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 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 and actions, actual results could differ from these estimates.

III. Fixed Assets

Tangible Assets

a) Free hold land not containing mineral reserves is disclosed at cost.

b) Other Fixed assets are disclosed at cost less accumulated depreciation/amortization and impairment loss, if any. Cost comprises of purchase price and attributable cost of bringing the asset to its working condition for its intended use (net of credit availed, if any).

Intangible assets

Intangible assets are recognized only if its cost can be measured reliably and it is possible that future economic benefits will flow to the Company. Such assets are stated at cost (net of credit availed, if any) less accumulated amortization. Cost includes any directly attributable expenditure on making the assets ready for its intended use.

Impairment of Assets

The carrying amount 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 recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss is further provided or reversed depending on changes in circumstances.

IV. Foreign Currency Transactions

Foreign currency transactions are recorded by applying the exchange rates on the date of transaction.

At each Balance sheet date, foreign currency monetary items are reported using the closing rates. 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 transaction.

Exchange difference arising on the settlement of monetary items/ foreign exchange contracts are recognized as income or expense in the period in which they arise.

Derivative Instruments

Derivative financial instruments are used to hedge risk associated with foreign currency fluctuations and interest rates. The derivative contracts are closely linked with the underlying transactions and are intended to be held to maturity. These are accounted on the date of their settlement and realized gain/loss in respect of settled contracts is recognized in the Statement of Profit and Loss.

V. Capital Work In Progress

Capital work in progress is carried at direct cost and Pre-operative expenditure during construction period is allocated to the fixed assets on the completion of project.

Expenditures on construction of assets for Company's use at premises owned by Government/Local Authorities/others are charged to Statement of Profit and Loss in the year of expenditure.

VI. Investments

Investments are classified into current and long-term investments. Current Investments are carried at lower of cost or fair market value. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary.

VII. Inventories

a. Raw Materials, Stores & Spare Parts, Packing Materials and Fuels

These are valued at lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on a weighted average basis.

b. Work-in-progress and Finished goods

These are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of finished goods includes excise duty. Cost is determined on a weighted average basis.

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

VIII. Revenue Recognition

Revenue from sale of goods and power is recognized when significant risks and rewards of ownership is transferred to the buyer.

Dividend income on investments is accounted for when the right to receive the payment is established.

Interest is recognized using the time-proportion method, based on rates implicit in the transaction.

Certain insurance, railway and other claims where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on mutually agreed price.

Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyer's account as evidenced by the receipt of confirmation of execution of delivery instructions.

IX. Government Grants / Subsidies

Government grants are recognized when there is reasonable assurance that the Company will comply with the conditions attached thereto and the grants will be received.

Government grants/subsidies, which are capital in nature, are credited to capital reserve.

Government grants related to revenue are recognized on a systematic basis in the Statement of Profit and Loss over the period to match them with the related costs.

X. Employee Benefits

(a) Defined Contribution Plan

Superannuation and Provident Fund are considered as defined contribution plan and the contributions are charged to the Statement of Profit & Loss of the year in which the contributions to the respective funds are due.

(b) Defined Benefit Plan

Gratuity is considered as defined benefit plan and is provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of the Balance Sheet.

Contribution to provident Fund set up by the Company in respect of a few employees is also defined benefit plan and contribution is charged to Statement of Profit and Loss of the year in which the contribution is due.

Encashable leave in case of employees covered by Cement Wage Board is considered as defined benefit plan and is accounted for on the basis of actuarial valuation, as at the Balance Sheet date.

(c) Other Benefits

Non encashable leave are provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of balance sheet.

Actuarial gains and losses, if any, are recognized in the Statement of Profit & Loss in the year in which they arise.

XI. Leases

Assets acquired under leases where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Lease rentals are charged to the Statement of Profit and Loss on accrual basis.

XII. Borrowing Costs

Borrowing costs directly attributable to the acquisition / construction of a qualifying asset are capitalized as part of the cost of the asset till the date the asset is put to use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

XIII. Depreciation and Amortization

Tangible Assets

(a) Depreciation is provided on Written down Value method at the rates specified in Schedule XIV of the Companies Act, 1956 or the rates prescribed in the Income Tax Act 1961, whichever is higher. However, in case of those assets whose WDV as per Income Tax Act, 1961 is lower than the WDV as per books, additional depreciation is provided to align the Book WDV with WDV as per Income Tax Act, 1961.

(b) Leasehold land not containing mineral reserve is amortized over the period of lease.

(c) Land bearing mineral reserves is valued at cost and are amortized over their estimated commercial lives based on the unit-of-production method.

Intangible Assets

(a) Expenditure incurred on Clean Development Mechanism Projects is amortized against sale proceeds.

(b) Expenditure on Computer Software is amortized in the year in which it is capitalized.

(c) Amount paid for Mining rights is amortized in the same year.

XIV. Research and Development

Expenditure on research phase is recognized as an expense when it is incurred. Expenditure on development phase which results in creation of assets is included in related Fixed Assets.

XV. Mines Reclamation Expenditure

The Company provides for the expenditure to reclaim the quarries used for mining. The total estimate of reclamation expenses is apportioned over the estimate of mineral reserves and a provision is made based on the minerals extracted.

XVI. Segment Reporting

Segment is identified and reported taking into account the nature of products and services, the different risks and returns and the internal business reporting systems. The identification of geographical segment is based on the areas in which major operating divisions of the Company operates.

Inter Segment Transfers are accounted for as if the sales or transfers were to third parties at market price.

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

Assets, Liabilities, Revenue and Expenses which are not allocable to segments are included under "unallocated".

XVII.Taxation

Current Tax is measured on the basis of estimated taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax is recognized, for all the timing differences. Deferred tax assets are recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized.

Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid in terms of Section 115JAA of the Income Tax Act, 1961 based on convincing evidence that the Company will pay normal income tax within the statutory time frame and the same is reviewed at each balance sheet date.

XVIII. Provisions and Contingent Liabilities /Assets

Provisions in respect of present obligation arising out of past events are made in the accounts when reliable estimate can be made of the amount of the obligations. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

The contingent liabilities are disclosed, unless the possibility of outflow of resources is remote. Contingent Assets are generally neither recognized nor disclosed in the financial statements.

XIX. Earnings per Share

Basic earnings per share are 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.

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.


Mar 31, 2011

01. Accounting Convention

The Financial statements of the Company are prepared under the historical cost convention using the accrual method of accounting and comply with the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of Companies Act, 1956 unless stated otherwise hereinafter. Accounting Policies not specifically referred to, are consistent with Generally Accepted Accounting Principles.

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 and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations 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.

03. Fixed Assets Tangible Assets

a) Free hold and Lease hold land are disclosed at cost. b) Fixed assets other than land are disclosed at cost less accumulated depreciation and impairment loss, if any. Cost comprises of purchase price and attributable cost of bringing the asset to its working condition for its intended use (net of credit availed, if any).

Intangible assets

Intangible assets are recognized only if its cost can be measured reliably and it is possible that future economic benefits will flow to the Company. Such assets are stated at cost (net of credit availed, if any) less accumulated amortization. Cost includes any directly attributable expenditure on making the assets ready for its intended use.

Impairment of Assets

The carrying amount 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 recognized wherever the carrying amount of an asset exceeds its recoverable amount. A previously recognized impairment loss is further provided or reversed depending on changes in circumstances.

04. Foreign Currency Transactions

Foreign currency transactions are recorded by applying the exchange rates on the date of transaction.

At each Balance sheet date, foreign currency monetary items are reported using the closing rates. 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 transaction. Exchange difference arising on the settlement of monetary items/ foreign exchange contracts are recognized as income or expense in the period in which they arise.

Derivative Instruments

Derivative financial instruments are used to hedge risk associated with foreign currency fluctuations and interest rates. The derivative contracts are closely linked with the underlying transactions and are intended to be held to maturity. These are accounted on the date of their settlement and realized gain / loss in respect of settled contracts is recognized in the Profit and Loss Account.

05. Capital Work In Progress

Capital work in progress is carried at direct cost (including advances) and Pre-operative expenditure during construction period is allocated to the fixed assets on the completion of project.

Expenditures on construction of assets for Companys use at premises owned by Government / Local Authorities / others are charged to Profit & Loss Accounts in the year of expenditure.

06. Investments

Investments are classified into current and long-term investments. Current Investments are carried at lower of cost or fair market value. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary.

07. Inventories

Inventories are stated at cost or net realizable value, whichever is lower. The material costs are determined on weighted average basis. The valuation of manufactured goods represents the combined cost of material, labour and manufacturing overheads and includes excise duty in case of finished goods only.

08. Revenue Recognition

Revenue from sale of goods and power is recognized when significant risks and rewards of ownership is transferred to the buyer. Dividend income on investments is accounted for when the right to receive the payment is established.

Interest is recognized using the time-proportion method, based on rates implicit in the transaction.

Certain insurance, railway and other claims where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on mutually agreed price.

Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyers account as evidenced by the receipt of confirmation of execution of delivery instructions.

09. Government Grants / Subsidies

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.

Government grants related to revenue are recognized on a systematic basis in the Profit and Loss Account over the period to match them with the related costs.

10. Employee Benefits

(a) Defined Contribution Plan

Superannuation and Provident Fund are considered as defined contribution plan and the contributions are charged to the Profit & Loss Account of the year in which the contributions to the respective funds are due.

(b) Defined Benefit Plan

Gratuity is considered as defined benefit plan and is provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of the Balance Sheet. Contribution to provident Fund set up by the Company in respect of a few employees is also defined benefit plan and contribution is charged to Profit & Loss Accounts of the year in which the contribution is due.

Encashable leave in case of employees covered by Cement Wage Board is considered as defined benefit plan and is accounted for on the basis of actuarial valuation, as at the Balance Sheet date.

Actuarial gains and losses, if any, are recognized in the Profit & Loss Account in the year in which they arise.

11. Leases

Assets acquired under leases where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Lease rentals are charged to the profit and loss account on accrual basis.

12. Borrowing Costs

Borrowing costs directly attributable to the acquisition / construction of a qualifying asset are capitalized as part of the cost of the asset till the date the asset is put to use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

13. Depreciation Tangible Assets

(a) Depreciation is provided on Written down Value method at the rates specified in Schedule XIV of the Companies Act, 1956 or the rates prescribed in the Income Tax Act 1961, whichever is higher. However, in case of those assets whose WDV as per Income Tax Act, 1961 is lower than the WDV as per books, additional depreciation is provided to align the Book WDV with WDV as per Income Tax Act, 1961. (b) Leasehold land is not amortized being long term in nature.

Intangible Assets

(a) Expenditure incurred on Clean Development Mechanism Projects is amortized against sale proceeds.

(b) Expenditure on Computer Software is amortized in the year in which it is capitalized.

(c) Amount paid for Mining rights is amortized in the same year.

14. Research and Development

Expenditure on research phase is recognized as an expense when it is incurred. Expenditure on development phase which results in creation of assets is included in related Fixed Assets.

15. Mines Reclamation Expenditure

The Company provides for the expenditure to reclaim the quarries used for mining. The total estimate of reclamation expenses is apportioned over the estimate of mineral reserves and a provision is made based on the minerals extracted.

16. Segment Reporting

Segment is identified and reported taking into account the nature of products and services, the different risks and returns and the internal business reporting systems. The identification of geographical segment is based on the areas in which major operating divisions of the Company operates.

Inter Segment Transfers are accounted for as if the sales or transfers were to third parties at market price. Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

Assets, Liabilities, Revenue and Expenses which are not allocable to segments are included under "unallocated”.

17. Taxation

Provision is made for current and deferred taxes. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax is recognized, for all the timing differences. Deferred tax assets are recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized.

18. Provisions and Contingent Liabilities /Assets

Provisions in respect of present obligation arising out of past events are made in the accounts when reliable estimate can be made of the amount of the obligations.

The contingent liabilities are disclosed, unless the possibility of outflow of resources is remote. Contingent Assets are generally neither recognized nor disclosed in the financial statements.

19. Earnings per Share

Basic earnings per share are 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. 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.


Mar 31, 2010

01. Accounting Convention

The Financial statements of the Company are prepared under the historical cost convention using the accrual method of accounting and comply with the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of Companies Act, 1956 unless stated otherwise hereinafter.Accounting Policies not specifically referred to, are consistent with Generally Accepted Accounting Principles.

02. Fixed Assets

Tangible Assets

a) Free hold and Lease hold land are disclosed at cost.

b) Fixed assets other than land are disclosed at cost less accumulated depreciation and impairment loss, if any.Cost comprises of purchase price and attributable cost of bringing the asset to its working condition for its intended use (net of credit availed, if any).

Intangible assets

Intangible assets are recognized only if its cost can be measured reliably and it is possible that future economic benefits will flow to the Company.Such assets are stated at cost (net of credit availed, if any) less accumulated amortization.Cost includes any directly attributable expenditure on making the assets ready for its intended use.

Impairment of Assets

The carrying amount 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 recognized wherever the carrying amount of an asset exceeds its recoverable amount.A previously recognized impairment loss is further provided or reversed depending on changes in circumstances.

03. Foreign Currency Transactions

Foreign currency transactions are recorded by applying the exchange rates on the date of transaction.

At each Balance sheet date, monetary foreign currency items are reported using the closing rates.

Exchange difference arising on the settlement of monetary items/ foreign exchange contracts are recognized as income or expense in the period in which they arise.

04. Capital Work In Progress

Capital work in progress is carried at direct cost (including advances) and Pre.operative expenditure during construction period is allocated to the fixed assets on the completion of project.

Expenditures on construction of assets for Companys use at premises owned by Government/Local Authorities/others are charged to Profit & Loss Account in the year of expenditure.

05. Investments

Investments are classified into current and long.term investments. Current Investments are carried at lower of cost or fair market value. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made only if such decline is other than temporary.

06. Inventories

Inventories are stated at cost or net realizable value whichever is lower.The material costs are determined on weighted average basis.The valuation of manufactured goods represents the combined cost of material, labour and manufacturing overheads and includes excise duty in case of finished goods only.

07. Revenue Recognition

Sales revenue is recognized on the transfer of significant risks and rewards of the ownership of goods to the buyer.

Dividend income on investments is accounted for when the right to receive the payment is established.

Interest is recognized using the time.proportion method, based on rates implicit in the transaction.

Certain insurance, railway and other claims where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on mutually agreed price.

Sale of Certified Emission Reductions (CERs) is recognized as income on the delivery of the CERs to the buyers account as evidenced by the receipt of confirmation of execution of delivery instructions.

08. Government Grants/Subsidies

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.

Government grants related to revenue are recognized on a systematic basis in the Profit and Loss Account over the period to match them with the related costs.

09. Employee Benefits:

(a) Defined Contribution Plan

Superannuation and Provident Fund are considered as defined contribution plan and the contributions are charged to the Profit & Loss Account of the year in which the contributions to the respective funds are due.

(b) Defined Benefit Plan

Gratuity is considered as defined benefit plan and is provided for on the basis of an actuarial valuation, using the projected unit credit method, as at the date of the Balance Sheet.

Contribution to provident Fund set up by the Company in respect of a few employees is also defined benefit plan and contribution is charged to Profit & Loss Account of the year in which the contribution is due.

Encashable leave in case of employees covered by Cement Wage Board is considered as defined benefit plan and is accounted for on the basis of actuarial valuation, as at the Balance Sheet date.

Actuarial gains and losses, if any, are recognized in the Profit & Loss Account in the year in which they arise.

10. Borrowing Costs

Borrowing costs directly attributable to the acquisition / construction of a qualifying asset are capitalized as part of the cost of the asset till the date the asset is put to use.Other borrowing costs are recognized as an expense in the period in which they are incurred.

11. Depreciation Tangible Assets:

(a) Depreciation is provided on Written down Value method at the rates specified in Schedule XIV of the Companies Act, 1956 or the rates prescribed in the Income Tax Act 1961, whichever is higher.However, in case of those assets whose WDV as per Income Ta x Act 1961 is lower than the WDV as per books, additional depreciation is provided to align the Book WDV with WDV as per Income Tax Act, 1961.

(b) Leasehold land is not amortized being long term in nature.

Intangible Assets:

(a) The amount of amortization is allocated on a systematic basis over the estimated/legal life not exceeding 10 years commencing when asset is available for use except Clean Development Mechanism Projects which are amortized against sale proceeds.

(b) Expenditure on Computer Software is amortized in the year in which it is capitalized.

12. Research and Development

Expenditure on research phase is recognized as an expense when it is incurred.Expenditure on development phase which results in creation of assets is included in related Fixed Assets.

13. Mines Reclamation Expenditure

The Company provides for the expenditure to reclaim the quarries used for mining.The total estimate of reclamation expenses is apportioned over the estimate of mineral reserves and a provision is made based on the minerals extracted.

14. Segment Reporting

Segment is identified and reported taking into account the nature of products and services, the different risks and returns and the internal business reporting systems.The identification of geographical segment is based on the areas in which major operating divisions of the Company operate.

Inter Segment Transfers are accounted for as if the sales or transfers were to third parties at market price.

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

Assets, Liabilities, Revenue and Expenses which are not allocable to segments are included under “unallocated”.

15. Taxation

Provision is made for current and deferred taxes.Deferred tax is recognized, for all the timing differences.Deferred tax assets are recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized.

16. Provisions and Contingent Liabilities /Assets

Provisions in respect of present obligation arising out of past events are made in the accounts when reliable estimate can be made of the amount of the obligations.

The contingent liabilities are disclosed, unless the possibility of outflow of resources is remote. Contingent Assets are generally neither recognized nor disclosed in the financial statements.

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