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Accounting Policies of Supreme Industries Ltd. Company

Mar 31, 2017

1. SIGNIFICANT ACCOUNTING POLICIES 1.1 Company Overview

The Supreme Industries Limited ("the Company") is public limited Company incorporated and domiciled in India and has registered office at 612, Raheja Chambers, Nariman Point, Mumbai 400 021. It is incorporated under the Indian Companies Act, 1913 and its shares are listed on the Bombay Stock Exchange Limited and National Stock Exchange in India.

The Supreme Industries Limited is one of the leading plastic products manufacturing company in India having 25 manufacturing facilities spread across the country. Company is engaged in manufacturing various plastic products like Plastic Piping System, Industrial and Engineering Molded products, Storage and Material Handling Products, Plastic Molded Furniture, Protective Packaging Products, Cross Laminated Film and products thereof, Performance packaging Film and Composite LPG Cylinders etc.

1.2 Basis of Accounting

These financial statements have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the ''Ind AS'') as notified under the Companies (Indian Accounting standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendments Rules 2016 prescribed under section 133 of the Companies Act, 2013 read with rule 7 of the Companies (Accounts) Rules, 2014.

The financial statements of the Company are prepared and presented on accrual basis and under the historical cost convention, except for the following material items that have been measured at fair value as required by the relevant Ind AS:

- Certain financial assets and liabilities are measured at Fair value (refer accounting policy on financial instruments - note 1.9 below.

- Defined Benefit and other Long term Employee Benefits - Refer note 1.11 below.

- Derivative Financial instruments - Refer note 1.9 below.

1.3 Use of Estimates and Judgments

The preparation of the financial statements requires that the Management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The recognition, measurement, classification or disclosure of an item or information in the financial statements is made relying on these estimates.

The estimates and judgments used in the preparation of the financial statements are continuously evaluated by the Company and are based on historical experience and various other assumptions and factors (including expectations of future events) that the Company believes to be reasonable under the existing circumstances. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

All the assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle of twelve months and other criteria set out in Schedule III to the Companies Act, 2013.

1.4 Property, Plant And Equipment & Intangible Assets Property, Plant and Equipment

Freehold land is carried at historical cost. All other items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses, if any. Costs include freight, import duties, non-refundable purchase taxes and other expenses directly attributable to the acquisition of the asset.

Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

Intangible Assets

Intangible assets are held on the balance sheet at cost less accumulated amortization and impairment losses. Intangible assets developed or acquired with finite useful life are amortized on straight line basis over the useful life as specified below:

- Computer Software and Licenses - 3 to 4 years

- Right to Use- 5 years

Capital Work-in-progress and Pre-operative Expenses during Construction Period

Capital Work-in-Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

* Useful life of Plant & Equipment of Plastic Piping System Division, Protective Packaging Division and Cross Laminated Film Division and Moulds and Dies are determined based on the internal assessment supported by independent technical evaluation carried out by external values.

The management believes that the useful life as given above the best represent the period over which the management expects to use these assets. The Company reviews the useful lives and residual value at each reporting date.

Depreciation on assets added/sold or discarded during the year is being provided on pro-rata basis up to the date on which such assets are added/sold or discarded.

Leasehold Land is amortized over the period of lease.

Assets costing up to V 10,000 each are depreciated fully in the year of purchase.

Gains/Losses on disposals/de-recognition of property, plant and equipment are determined by comparing proceeds with carrying amount and these are recognized in statement of profit & Loss.

1.5 Impairment of Non Financial Assets

The Company assesses at each reporting date whether there is any objective evidence that a non-financial asset or a group of non-financial assets are impaired. If any such indication exists, the Company estimates the amount of impairment loss. For the purpose of assessing impairment, the smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows from other assets or groups of assets is considered as a cash generating unit. If any such indication exists, an estimate of the recoverable amount of the individual asset/cash generating unit is made.

An impairment loss is calculated as the difference between an asset''s carrying amount and recoverable amount. Losses are recognized in profit or loss and reflected in an allowance account. When the Company considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, then the previously recognized impairment loss is reversed through profit or loss.

1.6 Revenue Recognition

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

Sale of goods:

Revenue from the sale of goods is recognized when the significant risks and rewards of ownership of the goods have been transferred to the buyer either at the time of dispatch or delivery or when the risk of loss transfers. Export sales are recognized based on the shipped on board date as per bill of lading, which is when substantial risks and rewards of ownership are passed to the customers.

Revenue from sale of goods is net of taxes and recovery of charges collected from customers like transport, packing etc. Provision is made for returns when appropriate. Revenue is measured at the fair value of consideration received or receivable and is net of price discounts, allowance for volume rebates and similar items.

Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement and are recognized as revenue on certainty of receipt on prudent basis.

Rendering of services:

Revenue from sale of services are recognized when the services are rendered.

Other Income

Dividend income on investments is recognized when the right to receive dividend is established.

Interest income is recognized on a time proportionate basis taking into account the amounts invested and the rate of interest. For all financial instruments measured at amortized cost, interest income is recorded using the Effective interest rate method to the net carrying amount of the financial assets.

1.7 Government Grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with.

Government grants related to revenue are recognized on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs which they are intended to compensate. Such grants are deducted in reporting the related expense. When the grant relates to an asset, it is recognized as income over the expected useful life of the asset.

In case a non-monetary asset is given free of cost it is recognized at a fair value. When loan or similar assistance are provided by government or related institutions, with an interest rate below the current applicable market rate, the effect of this favorable interest is recognized as government grant. The loan or assistance is initially recognized and measured at fair value and the government grant is measured as the difference between the initial carrying value of the loan and the proceeds received.

1.8 Inventories

Inventories includes Raw Material, Work-in-Progress, Finished goods, Stores & spares , Consumables, Packing Materials, Goods for resale and commercial premises are valued at lower of cost and net realizable value.

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

Raw Material and Components - Cost include cost of purchases and other costs incurred in bringing the inventories to their present location and condition. Cost is determined using identified lot basis / First in first out (FIFO) basis.

Finished/Semi-Finished Goods - cost includes cost of direct material, labor, other direct cost and a proportion of fixed manufacturing overheads allocated based on the normal operating capacity but excluding borrowing costs. Cost is determined on weighted average cost basis

Stores, Spare Parts, Consumables, Packing Materials etc. - cost is determined on FIFO basis.

Goods for Resale - cost is determined on FIFO basis

Commercial Premises - Cost includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

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

Adequate allowance is made for obsolete and slow moving items.

1.9 FINANCIAL INSTRUMENTS Financial assets - Initial recognition

Financial assets are recognized when the Company becomes a party to the contractual provisions of the instruments. Financial assets other than trade receivables are initially recognized at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognized at fair value, and transaction costs are expensed in the Statement of Profit and Loss.

Subsequent measurement

Financial assets, other than equity instruments, are subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss on the basis of both:

(a) the entity''s business model for managing the financial assets and

(b) the contractual cash flow characteristics of the financial asset.

(a) Measured at amortized cost:

A financial asset is measured at amortized cost, if it is held under the hold to collect business model i.e. held with an objective of holding the assets to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest on the principal outstanding. Amortized cost is calculated using the effective interest rate ("EIR") method by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included in interest income in the Statement of Profit and Loss. The losses arising from impairment are recognized in the Statement of Profit and Loss. On derecognition, gain or loss, if any, is recognized to Statement of Profit and Loss.

(b) Measured at fair value through other comprehensive income (FVOCI):

A financial asset is measured at FVOCI, if it is held under the hold to collect and sell business model i.e. held with an objective to collect contractual cash flows and selling such financial asset and the contractual cash flows are solely payments of principal and interest on the principal outstanding. It is subsequently measured at fair value with fair value movements recognized in the OCI, except for interest income which recognized using EIR method. The losses arising from impairment are recognized in the Statement of Profit and Loss. On derecognition, cumulative gain or loss previously recognized in the OCI is reclassified from the equity to Statement of Profit and Loss.

(c) Measured at fair value through profit or loss (FVTPL):

Investment in financial asset other than equity instrument, not measured at either amortized cost or FVOCI is measured at FVTPL. Such financial assets are measured at fair value with all changes in fair value, including interest income and dividend income if any, recognized in the Statement of Profit and Loss.

Equity Instruments:

All investments in equity instruments classified under financial assets are subsequently measured at fair value. Equity instruments which are held for trading are measured at FVTPL.

For all other equity instruments, the Company may, on initial recognition, irrevocably elect to measure the same either at FVOCI or FVTPL. The Company makes such election on an instrument-by-instrument basis. Fair value changes on an equity instrument shall be recognized in Statement of Profit and Loss unless the Company has elected to measure such instrument at FVOCI. Fair value changes excluding dividends, on an equity instrument measured at FVOCI are recognized in the OCI. Amounts recognized in Other Comprehensive Income (OCI) are not subsequently transferred to Statement of Profit and Loss. Dividend income on the investments in equity instruments are recognized in Statement of Profit and Loss.

Impairment

The Company recognizes a loss allowance for Expected Credit Losses (ECL) on financial assets that are measured at amortized cost and at FVOCI. The credit loss is difference between all contractual cash flows that are due to an entity in accordance with the contract and all the cash flows that the entity expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate. This is assessed on an individual or collective basis after considering all reasonable and supportable including that which is forward-looking.

The Company''s trade receivables or contract revenue receivables do not contain significant financing component and loss allowance on trade receivables is measured at an amount equal to life time expected losses i.e. expected cash shortfall, being simplified approach for recognition of impairment loss allowance.

Under simplified approach, the Company does not track changes in credit risk. Rather it recognizes impairment loss allowance based on the lifetime ECL at each reporting date right from its initial recognition. The Company uses a provision matrix to determine impairment loss allowance on the portfolio of trade receivables.

The provision matrix is based on its historically observed default rates over the expected life of the trade receivable and is adjusted for forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.

For financial assets other than trade receivables, the Company recognizes 12-month expected credit losses for all originated or acquired financial assets if at the reporting date the credit risk of the financial asset has not increased significantly since its initial recognition. The expected credit losses are measured as lifetime expected credit losses if the credit risk on financial asset increases significantly since its initial recognition. If, in a subsequent period, credit quality of the instrument improves such that there is no longer significant increase in credit risks since initial recognition, then the Company reverts to recognizing impairment loss allowance based on 12 months ECL.

The impairment losses and reversals are recognized in Statement of Profit and Loss. For equity instruments and financial assets measured at FVTPL, there is no requirement for impairment testing.

De-recognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers rights to receive cash flows from an asset, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Financial Liabilities

Initial Recognition and measurement

Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instruments. Financial liabilities are initially recognized at fair value net of transaction costs for all financial liabilities not carried at fair value through profit or loss.

The Company''s financial liabilities includes trade and other payables, loans and borrowings including bank overdrafts and derivative instruments.

Subsequent measurement

Financial liabilities measured at mortised cost are subsequently measured at using EIR method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.

Loans & Borrowings:

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

Financial Guarantee Contracts

Financial guarantee contracts issued by the Company are those contracts that requires a payment to be made or to reimburse the holder for a loss it incurs because the specified debtors fails to make payment when due in accordance with the term of a debt instrument. Financial guarantee contracts are recognized initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee.

Subsequently the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognized less cumulative adjustments.

De-recognition

A financial liability is de-recognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit or loss.

Derivative financial instruments & hedge accounting

The Company uses derivative financial instruments, such as forward foreign exchange contracts, interest rate swaps, cross currency interest risk swap to hedge its foreign currency risks. Such derivative financial instruments are initially recognized at fair value on the date on which a derivative contract is entered into and are subsequently premeasured at fair value, with changes in fair value recognized in Statement of Profit and Loss. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

The Company designates their derivatives as hedges of foreign currency risk associated with the cash flows of highly probable forecast transactions and variable interest rate risks associated with the borrowings.

The Company documents at the inception of hedging transaction the economic relationship between hedging instruments and hedged items including whether the hedging instrument is expected to offset cash flow of hedged items. The Company documents its risk management objective and strategy for undertaking various hedge transaction at the inception of each hedge relationship.

Cash flows hedge that qualify for the hedge accounting

Any gains or losses arising from changes in the fair value of derivatives are taken directly to statement of profit & loss, except for the effective portion of cash flow hedge which is recognized in other comprehensive income and presented as separate component of equity which is later reclassified to statement of profit & loss when the hedge item affects profit & loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the Balance Sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

1.10 FAIR VALUE MEASUREMENT:

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability, or

- In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

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

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

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

1.11 EMPLOYEE BENEFITS

The Company has following post-employment plans:

(a) Defined benefit plans such a gratuity and

(b) Defined contribution plans such as Provident fund & Superannuation fund

a) Defined-benefit plan:

The liability or asset recognized in the balance sheet in respect of defined benefit gratuity plan is the present value of defined benefit obligations at the end of the reporting period less fair value of plan assets. The defined benefit obligations is calculated annually by actuaries through actuarial valuation using the projected unit credit method.

The Company recognizes the following changes in the net defined benefit obligation as an expense in the statement of profit and loss:

(a) Service costs comprising current service costs, past-service costs, gains and losses on curtailment and non-routine settlements; and

(b) Net interest expense or income

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

Re-measurement comprising

(a) Re-measurement of Actuarial (gains)/losses

(b) Return on plan assets, excluding amount recognized in effect of asset ceiling

(c) Re-measurement arising because of change in effect of asset ceiling are recognized in the period in which they occur directly in Other comprehensive income. Re-measurement are not reclassified to profit or loss in subsequent periods.

Ind AS 19 requires the exercise of judgment in relation to various assumptions including future pay rises, inflation and discount rates and employee and pensioner demographics. The Company determines the assumptions in conjunction with its actuaries, and believes these assumptions to be in line with best practice, but the application of different assumptions could have a significant effect on the amounts reflected in the income statement, other comprehensive income and balance sheet. There may be also interdependency between some of the assumptions.

b) Defined-contribution plan:

Under defined contribution plans, provident fund, the Company pays pre-defined amounts to separate funds and does not have any legal or informal obligation to pay additional sums. Defined Contribution plan comprise of contributions to the employees'' provident fund with the government, superannuation fund and certain state plans like Employees'' State Insurance and Employees'' Pension Scheme. The Company''s payments to the defined contribution plans are recognized as expenses during the period in which the employees perform the services that the payment covers.

c) Other employee benefits:

(a) Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as a liability at the present value of the obligation as at the Balance sheet date determined based on an actuarial valuation.

(b) Undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognized during the period when the employee renders the related services.

d) Expenses incurred towards voluntary retirement scheme are charged to the statement of profit and loss as and when incurred.

e) Other benefits comprising of discretionary long service awards are recognized as and when determined.

1.12 LEASES

A lease is classified at the inception date as a finance lease or an operating lease. Leases under which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. When acquired, such assets are capitalized at fair value or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in finance costs in the statement of profit and loss

Other leases are treated as operating leases, with payments are recognized as expense in the statement of profit & loss on a straight-line basis over the lease term.

1.13 FOREIGN CURRENCY TRANSACTIONS

a) Initial Recognition

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the year are recognized in the Statement of Profit and Loss of the year.

b) Measurement of Foreign Currency Items at the Balance Sheet Date

Foreign currency monetary items of the Company are restated at the closing exchange rates. Non monetary items are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising out of these transactions are charged to the Statement of Profit and Loss.

1.14 TAXES ON INCOME

Income tax comprises current and deferred tax. Income tax expense is recognized in the statement of profit and loss except to the extent it relates to items directly recognized in equity or in other comprehensive income.

Current tax is based on taxable profit for the year. Taxable profit is different from accounting profit due to temporary differences between accounting and tax treatments, and due to items that are never taxable or tax deductible. Tax provisions are included in current liabilities. Interest and penalties on tax liabilities are provided for in the tax charge. The Company offsets, the current tax assets and liabilities (on a year on year basis) where it has a legally enforceable right and where it intends to settle such assets and liabilities on a net basis or to realize the assets and liabilities on net basis.

Deferred income tax is recognized using the balance sheet approach. Deferred income tax assets and liabilities are recognized for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their carrying amount in financial statements. Deferred income tax asset are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized. Deferred tax assets are not recognized where it is more likely than not that the assets will not be realized in the future.

The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax items are recognized in correlation to the underlying transaction either in OCI or directly in equity.

Minimum Alternative Tax (''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. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income-tax during the specified period.

1.15 RESEARCH AND DEVELOPMENT EXPENDITURE

Research costs are expensed as incurred. Product development costs are expensed as incurred unless technical and commercial feasibility of the project is demonstrated, further economic benefits are probable, the Company has an intention and ability to complete and use or sell the product and the costs can be measured reliably.

1.16 PROVISIONS AND CONTINGENCIES

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

Provisions for onerous contracts are recognized when the expected benefits to be derived by the Company from a contract are lower than the unavoidable costs of meeting the future obligations under the contract.

A disclosure for contingent liabilities is made where there is a possible obligation or a present obligation that may probably not require an outflow of resources or an obligation for which the future outcome cannot be ascertained with reasonable certainty. When there is a possible or a present obligation where the likelihood of outflow of resources is remote, no provision or disclosure is made.

1.17 CASH AND CASH EQUIVALENTS

Cash and Cash equivalents include cash and Cheque in hand, bank balances, demand deposits with banks and other short-term highly liquid investments that are readily convertible to known amounts of cash & which are subject to an insignificant risk of changes in value where original maturity is three months or less.

1.18 CASH FLOW STATEMENT

Cash flows are reported using the indirect method where by the profit before tax is adjusted for the effect of the transactions of a non-cash nature, any deferrals or accruals of past and future operating cash receipts or payments and items of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the company are segregated.

1.19 BORROWING COST

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of qualifying assets are capitalized as a part of Cost of that assets, during the period till all the activities necessary to prepare the Qualifying assets for its intended use or sale are complete during the period of time that is required to complete and prepare the assets for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Other borrowing costs are recognized as an expense in the period in which they are incurred.

1.20 EARNINGS PER SHARE

Basic EPS is arrived at based on net profit after tax available to equity shareholders to the weighted average number of equity shares outstanding during the year.

The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless impact is anti-dilutive.

1.21 OPERATING SEGMENT

Operating segments are reported in a manner consistent with the internal reporting provided to Chief Operating Decision Maker (CODM).

The Company has identified its Managing Director as CODM which assesses the operational performance and position of the Company and makes strategic decisions.

1.22 EXCEPTIONAL ITEMS

When an item of income or expense within profit or loss from ordinary activity is of such size, nature or incidence that their disclosure is relevant to explain the performance of the Company for the year, the nature and amount of such items is disclosed as exceptional items.

Terms/rights attached to Equity shares :

The Company has only one class of issued Equity Shares having a par value of V 2 per share. Each Shareholder is eligible for one vote per share held.

In the event of liquidation, the equity shareholders are eligible to receive the residual assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

The details of Shareholders holding more than 5% shares:

In the Period of five years immediately preceding March, 2017:

The Company has not alloted any equity shares as fully paid up without payment being received in cash or as Bonus Shares or Bought back any equity shares.

Proposed Dividend:

The Board of directors have recommended the payment of a final dividend of V 12 per fully paid up equity share (March 31, 2016 : V NIL ), The proposed dividend is subject to the approval of shareholders in the ensuing annual general meeting.


Jun 30, 2015

A. Basis of Accounting

a) The financial statements are prepared in accordance with generally accepted accounting principles in India under the historical cost convention on an accrual basis Pursuant to section 133 of the Companies Act, 2013 ('The Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, till the standards of accounting or any addendum thereto are prescribed by the Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing Accounting Standards notified under the Companies Act, 1956 shall continue to apply. Consequently, these financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211(3C) of the Companies Act, 1956 [Companies (Accounting Standards) Rules, 2006, as amended] and other relevant provisions of the Companies Act, 2013.

b) The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known/ materialized.

c) All the assets and liabilities have been classified as current or non-current as per the company's normal operating cycle of twelve months and other criteria set out in Schedule III to the Companies Act, 2013.

B. Revenue Recognition

a) Sales are recognized at the time of transfer of ownership and significant risk of goods to the customer. Service income is recognized when the service is rendered. Sales & Services are accounted for net of Excise Duty, VAT, Service tax, returns, claims & discounts etc.

b) Sales exclude recovery of charges separately collected from customers like transport, packing etc.

c) The Company adopts the Mercantile method in the preparation of the accounts. Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

d) Government Benefits on account of export sales is estimated and accounted for in the year of export and when there is no significant uncertainty regarding the ultimate collections of export proceeds as applicable.

e) Industrial promotion subsidy / government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

f) Other Income -

Dividend income on investments is recognised when the right to receive dividend is established.

Interest is recognized on a time proportionate basis taking into account the amounts invested and the rates of interest.

C. Fixed Assets

a) Fixed assets are stated at cost of acquisition or construction (net of CENVAT Credit/ Value Added Tax, subsidy or grants on account of assets) less accumulated depreciation and amortization.

b) Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

c) The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

d) Self constructed assets are recognized at direct cost incurred and proportionate allocation of overheads incurred to develop the said asset.

e) Gains or Losses arising from disposal of discarded assets which are carried at its book value are recognized in the statement of Profit & Loss.

D. Capital Work-in-Progress and Preoperative Expenses during Construction Period

Capital Work-in-Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. Depreciation & Amortisation

Tangible Assets

a) Depreciation on assets acquired up to 30th June, 2014 for Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method.

Depreciation on all Assets acquired on or after 1st July, 2014 is provided on the straight line method.

b) Depreciation on Tangible Fixed Assets is provided over the useful lives of the assets as prescribed by Schedule II of the Companies Act, 2013 with the exception of the following;

Plant & Machinery of Plastic Piping System Division, Protective Packaging Division and Cross Laminated Film Division is depreciated on triple shift basis over 12 to 18 years based on internal assessment and independent technical evaluation carried out by external valuers.

The management believes that the useful life as given above best represent the period over which the management expects to use these assets.

c) Depreciation on assets sold or discarded during the year is being provided on pro-rata basis up to the date on which such assets are sold or discarded.

d) Leasehold Land is amortized over the period of lease.

e) Assets costing up to Rs. 10,000/- each are depreciated fully in the year of purchase.

Intangible Assets

Intangible assets developed or acquired are amortised on straight line basis over the useful life as specified below:

a) Computer Software and Licenses - 3 to 4 years

b) Technical License / Know-how Fee - 5 years

Government Grants

Grants received against specific fixed assets are adjusted to the cost of the assets in the year of receipt. Revenue grants are recognized in the Statement of Profit & Loss in accordance with the related scheme and accounted for in the period in which these are accrued.

F. Investments

a) All long term investments are stated at cost. Provision for diminution, if any, in the value of investments is made to recognize a decline, other than temporary, in the opinion of the management.

b) Current investments are carried at the lower of cost and fair value, determined on a category-wise basis.

G. Inventories

a) Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

b) Finished Goods/Semi-Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower. Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition.

c) Stores, Spare Parts, Packing Materials etc. - at cost using FIFO or at net realisable value whichever is lower.

d) Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

e) Inter divisional transfers are valued at works/factory costs of the transferor unit/division, plus transport and other charges.

H. Assets Taken on Lease

In respect of operating leases, lease rentals are recognized as an expense in the Statement of Profit & Loss on an accrual basis over the leased term.

In respect of assets obtained on finance leases, assets are recognized at their fair value at the date of acquisition or if lower, at the present value of minimum lease payments. The corresponding liability to the lessor is included in the Balance Sheet as a Finance Lease obligation. The excess of lease payments over the recorded lease obligations are treated as Finance charges which are allocated to each lease term so as to produce a constant rate of charge on the remaining balance of the obligations. The assets are depreciated as owned depreciable assets.

I. Foreign Currency Transactions

a) Initial Recognition

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the year are recognized in the Statement of Profit & Loss of the year.

b) Measurement of Foreign Currency Items at the Balance Sheet Date

Foreign currency monetary items of the Company are restated at the closing exchange rates. Non monetary items are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising out of these transactions are charged to the Statement of Profit & Loss.

c) Forward Exchange Contracts.

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense/ income over the life of the contract. Exchange differences on such contracts are recognized in the Statement of Profit & Loss in the period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or expense for the period.

The Company uses foreign currency forward contracts to hedge its actual underlying exposures and not for trading or speculation purpose. The use of these forward contracts reduces the risk and/or cost to the company.

J. Employee Benefits

a) Short Term Benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss of the year in which related service is rendered.

b) Post Employment Benefits:-

* Defined Contribution Plan

Company's contribution to the superannuation scheme and State Governed Provident Fund Scheme is recognized during the year in which related service is rendered.

* Defined Benefit Plan :- Gratuity

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the statement of profit and loss. The Gratuity Funds for the employees are administered by Life Insurance Companies.

c) Compensated Absences: -

The company has a policy of providing compensated absences to its employees. The expense is recognized at the present value of the amount payable determined based on independent actuarial valuation, using projected unit credit method. The company doesn't maintain any plan funds to fund its obligation towards compensated absences.

d) Other benefits comprising of discretionary long service awards are recognized as and when determined.

K. Research & Development Expenditure

Revenue expenditure on research and development is charged to the statement of profit and loss. Expenditure, which results in creation of capital asset, is capitalized in the year in which it is incurred and depreciation is provided on such assets as applicable.

L. Share / Debenture Issue Expenses And Debenture Redemption Reserve Issue expenses are adjusted against the Securities Premium Account.

Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

Premium paid / payable on redemption is adjusted against the Securities Premium Account

M. Taxes on Income

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending on 30th June.

Deferred tax is recognized, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

Wealth tax is provided in accordance with the provisions of Wealth Tax Act, 1957.

N. Provisions and Contingencies

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent Assets are not recognized.

O. Cash and Cash Equivalents

Cash & Cash equivalents include cash & Cheque in hand, bank balances, demand deposits with banks and other short-term highly liquid investments where original maturity is three months or less.

P. Borrowing Cost

Borrowing Cost includes interest, amortization of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as adjustment to the interest cost. Interest and other borrowing costs attributable to acquisition, construction or production of qualifying assets that takes a substantial period of time to get ready for its intended use or sale are capitalized. All other borrowing costs are expensed out in the period they occur.

Q. Earnings per Share

Basic and diluted earnings per share are computed by dividing the net profit attributable to equity shareholders for the year, with the weighted average number of shares outstanding during the year.

R. Construction Business

The company had ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business are as under:-

Revenue recognition

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

Cost recognition

Proportionate cost including estimated cost of completion of real estate sold is recognized in statement of profit and loss and shown separately under the head "Cost of materials consumed".

Valuation of inventory

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower. Construction work-in-progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.


Jun 30, 2014

A. Basis of Accounting

a) The financial statements are prepared under the historical cost convention, in accordance with generally accepted accounting principles in India, the Companies Accounting Standards Rules, 2006 and relevant provisions of Companies Act, 1956 which continues to be applicable in respect of section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs & the relevant provisions of the Companies Act 1956 & Companies Act 2013,as applicable,as adopted consistently by the company. .The accounting is on the basis of a going concern concept.

b) The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known/ materialized.

c) All the assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle of twelve months and other criteria set out in Revised Schedule VI to the Companies Act, 1956.

B. Revenue Recognition

a) Sales are recognized at the point of dispatch of goods to the customer. Service income is recognized when the service is rendered. Sales & Services are accounted for net of excise duty, service tax, returns & claims etc.

b) The Company adopts the accrual concept in the preparation of the accounts. Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

c) Benefit on account of entitlement to import duty-free raw materials under any Scheme as announced by the government, is estimated and accounted for in the year of export and when there is no significant uncertainty regarding the ultimate collections of export proceeds as applicable.

d) Industrial promotion subsidy / government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

C. Fixed Assets

a) Certain Land, Buildings, Plant & Machinery and Moulds & Dies are stated at revalued amounts as a result of their revaluation less depreciation.

b) Other fixed assets are stated at cost less accumulated depreciation and amortization.

c) Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

d) The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

D. Capital Work-in-Progress and Preoperative Expenses during Construction Period

Capital Work-in-Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. Depreciation & Amortisation Tangible Assets

a) Depreciation on Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, except certain specific assets on which depreciation is provided at higher rates based on useful life of the assets estimated by the management.

b) Certain class of assets acquired after 1-7-2009 / 1-7-2010 have been depreciated at rates higher than as specified in Schedule XIV of the Companies Act, 1956, the details thereof are as under :-

- Injection moulding machines- 8.33% p.a. on SLM basis.

- Ancillary Equipments & utilities -14.28% p.a. on SLM basis

- Electronic equipments: - 60% on WDV basis

- Computers:- 60% on WDV basis

- Depreciation on additions to the assets during the year is being provided on pro-rata basis from the date of acquisition/ installation.

c) Depreciation on assets sold or discarded during the year is being provided on pro-rata basis up to the date on which such assets are sold or discarded.

d) Leasehold Land is amortised over the period of lease.

e) Assets costing up to Rs. 5,000/- each are depreciated fully in the year of purchase.

Intangible Assets

Intangible assets developed or acquired are amortised on straight line basis at the rates specified below:

a) Computer Software and Licenses - 25%.

b) Technical License / Know-how Fee - 20%

c) Right To Use - 20%

F. Investments

a) All long term investments are stated at cost. Provision for diminution, if any, in the value of investments is made to recognize a decline, other than temporary, in the opinion of the management.

b) Current investments are carried at the lower of cost and fair value, determined on a category-wise basis.

G. Inventories

Inventories of plastic goods are valued as under:-

a) Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

b) Finished Goods/Semi-Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower. Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition

c) Stores, Spare Parts, Packing Materials etc. - at cost using FIFO basis except obsolete and non-moving items stated at net realisable value.

d) Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

e) Inter divisional transfers are valued at works/factory costs of the transferor unit/division, plus transport and other charges.

H. Assets Taken on Lease

In respect of operating leases, lease rentals are recognized as an expense in the Statement of Profit & Loss on an accrual basis over the leased term.

In respect of assets obtained on finance leases, assets are recognized at their fair value at the date of acquisition or if lower, at the present value of minimum lease payments. The corresponding liability to the lessor is included in the Balance Sheet as a Finance Lease obligation. The excess of lease payments over the recorded lease obligations are treated as Finance charges which are allocated to each lease term so as to produce a constant rate of charge on the remaining balance of the obligations. The assets are depreciated as owned depreciable assets.

I. Foreign Currency Transactions

a) Initial Recognition

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the Statement of Profit & Loss of the year.

b) Measurement of Foreign Currency Items at the Balance Sheet Date

Foreign currency monetary items of the Company are restated at the closing exchange rates. Non monetary items are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising out of these transactions are charged to the Statement of Profit & Loss.

c) Forward Exchange Contracts.

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense/ income over the life of the contract. Exchange differences on such contracts are recognized in the Statement of Profit & Loss in the period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or expense for the period.

The Company uses foreign currency forward contracts to hedge its actual underlying exposures and not for trading or speculation purpose. The use of these forward contracts reduces the risk and/or cost to the company.

J. Employee Benefits

a) Short Term Benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which related service is rendered.

b) Post Employment Benefits:-

- Defined Contribution Plan

Company''s contribution to the superannuation scheme and State Governed Provident Fund Scheme is recognised during the year in which related service is rendered.

- Defined Benefit Plan :- Gratuity

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the statement of profit and loss. The Gratuity Funds for the employees are administered by Life Insurance Corporation of India under Group Gratuity Scheme.

c) Compensated Absences: -

The company has a policy of providing compensated absences to its employees. The expense is recognized at the present value of the amount payable determined based on independent actuarial valuation, using projected unit credit method. The company doesn''t maintain any plan funds to fund its obligation towards compensated absences.

d) Other benefits comprising of discretionary long service awards are recognized as and when determined.

K. Research & Development Expenditure

Revenue expenditure on research and development is charged to the statement of profit and loss. Expenditure, which results in creation of capital asset, is capitalised in the year in which it is incurred and depreciation is provided on such assets as applicable.

L. Share / Debenture Issue Expenses And Debenture Redemption Reserve

Issue expenses are adjusted against the Securities Premium Account.

Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

Premium paid / payable on redemption is adjusted against the Securities Premium Account.

M. Taxes On Income

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending 30th June.

Deferred tax is recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

Wealth tax is provided in accordance with the provisions of Wealth Tax Act, 1957.

N. Provisions and Contingencies

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes. Contingent Assets are not recognised.

O. Cash and Cash Equivalents

Cash & Cash equivalents include cash & cheques in hand, bank balances, demand deposits with banks and other short-term highly liquid investments where original maturity is three months or less.

P. Borrowing Cost

Borrowing Cost includes interest, amortization of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as adjustment to the interest cost. Interest and other borrowing costs attributable to acquisition, construction or production of qualifying assets that takes a substantial period of time to get ready for its intended use or sale are capitalised. All other borrowing costs are expensed out in the period they occur.

Q. Earnings per Share

Basic and diluted earnings per share are computed by dividing the net profit attributable to equity shareholders for the year, with the weighted average number of shares outstanding during the year.

R. Construction Business

The company had ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business are as under:-

(a) Revenue recognition

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

(b) Cost recognition

Proportionate cost including estimated cost of completion of real estate sold is recognized in statement of profit and loss and shown separately under the head "Cost of materials".

(c) Valuation of inventory

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower.

Construction work-in-progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.

Terms/rights attached to Equity shares :

The company has only one class of issued Equity Shares having a par value of Rs. 2 per share. Each Shareholder is eligible for one vote per share held.

The Dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

36 DISCLOSURE PURSUANT TO ACCOUNTING STANDARD - 15 "EMPLOYEE BENEFITS" i) Gratuity:

In accordance with the applicable laws, the Company provides for gratuity, a defined benefit retirement plan ("The Gratuity Plan") covering eligible employees. The Gratuity Plan provides for a lump sum payment to vested employees on retirement (subject to completion of five years of continuous employment), death, incapacitation or termination of employment that are based on last drawn salary and tenure of employment. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation on the reporting date and the Company makes annual contribution to the gratuity fund administered by Life Insurance Corporation of India under Group Gratuity Scheme.

The following table set out the funded status and amount recognised in the Company''s financial statements as at 31st March, 2014 for the Gratuity Plan:

ii) Compensated Absences:

The Company permits encashment of compensated absence accumulated by their employees on retirement, separation and during the course of service. The liability in respect of the Company, for outstanding balance of leave at the balance sheet date is determined and provided on the basis of actuarial valuation as on 31st March 2014 performed by an independent actuary. The Company doesn''t maintain any plan assets to fund its obligation towards compensated absences.


Jun 30, 2013

A. BASIS OF ACCOUNTING

a) The financial statements are prepared under the historical cost convention, in accordance with generally accepted accounting principles, the Companies Accounting Standards Rules, 2006 and relevant provisions of Companies Act, 1956. The accounting is on the basis of a going concern concept.

b) The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

c) All the assets and liabilities have been classified as current or non-current as per the company’s normal operating cycle of twelve months and other criteria set out in Revised Schedule VI to the Companies Act, 1956.

B. REVENUE RECOGNITION

a) Sales & Services are accounted for net of excise duty, service tax, returns & claims etc.

b) The Company adopts the accrual concept in the preparation of the accounts. Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

c) Benefit on account of entitlement to import duty-free raw materials under any Scheme as announced by the government, is estimated and accounted for in the year of export.

d) Industrial promotion subsidy / government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

C. FIXED ASSETS

a) Certain Land, Buildings, Plant & Machinery and Moulds & Dies are stated at revalued amounts as a result of their revaluation less depreciation.

b) Other fixed assets are stated at cost less accumulated depreciation and amortization.

c) Interest on borrowings and incidental expenses incurred during the period of construction / installation and till the acquired assets are ready to use are added to the cost of fixed assets.

d) Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

e) The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

D. CAPITAL WORK-IN-PROGRESS AND PREOPERATIVE EXPENSES DURING CONSTRUCTION PERIOD

Capital Work-in-Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. DEPRECIATION & AMORTISATION Tangible Assets

a) Depreciation on Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, except certain specific assets on which depreciation is provided at higher rates based on useful life of the assets estimated by the management.

b) Certain class of assets acquired after 1-7-2009 / 1-7-2010 have been depreciated at rates higher than as specified in Schedule XIV of the Companies Act, 1956, the details thereof are as under :- - Injection moulding machines- 8.33% on SLM basis.

- Ancillary Equipments & utilities -14.28% on SLM basis

- Electronic equipments: - 60% on WDV basis

- Computers:- 60% on WDV basis

- Depreciation on additions to the assets during the year is being provided on pro-rata basis from the date of acquisition / installation.

c) Depreciation on assets sold or discarded during the year is being provided on pro-rata basis up to the date on which such assets are sold or discarded.

d) Leasehold Land is amortised over the period of lease.

e) Assets costing up to R 5,000/- each are depreciated fully in the year of purchase.

Intangible Assets

Intangible assets developed or acquired are amortised on straight line basis at the rates specified below:

a) Computer Software and Licenses - 25%.

b) Technical License / Know-how Fee - 20%

c) Right To Use - 20%

F. INVESTMENTS

a) All long term investments are stated at cost. Provision for diminution, if any, in the value of investments is made to recognize a decline, other than temporary, in the opinion of the management.

b) Current investments are carried at the lower of cost and fair value, determined on a category-wise basis.

G. INVENTORIES

Inventories of plastic goods are valued as under:- a) Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

b) Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower.

c) Stores, Spare Parts, Packing Materials etc. - at cost using FIFO basis except obsolete and non-moving items stated at net realisable value.

d) Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

e) Inter divisional transfers are valued at works / factory costs of the transferor unit / division, plus transport and other charges.

Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition.

H. ASSETS TAKEN ON LEASE

In respect of operating leases, lease rentals are recognized as an expense in the Statement of Profit & Loss on an accrual basis over the leased term.

In respect of assets obtained on finance leases, assets are recognized at their fair value at the date of acquisition or if lower, at the present value of minimum lease payments. The corresponding liability to the lessor is included in the Balance Sheet as a Finance Lease obligation. The excess of lease payments over the recorded lease obligations are treated as Finance charges which are allocated to each lease term so as to produce a constant rate of charge on the remaining balance of the obligations. The assets are depreciated as owned depreciable assets.

I. FOREIGN CURRENCY TRANSACTIONS

a) Initial Recognition

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the Statement of Profit & Loss of the year.

b) Measurement of Foreign Currency Items at the Balance Sheet Date

Foreign currency monetary items of the Company are restated at the closing exchange rates. Non monetary items are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising out of these transactions are charged to the Statement of Profit & Loss.

c) Forward Exchange Contracts

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense / income over the life of the contract. Exchange differences on such contracts are recognized in the Statement of Profit & Loss in the period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or expense for the period.

The Company uses foreign currency forward contracts to hedge its actual underlying exposures and not for trading or speculation purpose. The use of these forward contracts reduces the risk and / or cost to the company.

J. EMPLOYEE BENEFITS

a) Short Term Benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which related service is rendered.

b) Post Employment Benefits:- - Defined Contribution Plan

Company’s contribution to the superannuation scheme and State Governed Provident Fund Scheme is recognised during the year in which related service is rendered.

- Defined Benefit Plan :- Gratuity

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the statement of profit and loss. The Gratuity Funds for the employees are administered by Life Insurance Corporation of India under Group Gratuity Scheme.

Provident Fund

For selected employees, monthly contributions are made to a trust administered by the company. The interest rate payable to the beneficiaries shall not be lower than the statutory rate of interest notified by the government. The company has obligation to make good shortfall, if any, between return on investment of the Trust and rates notified by the Government.

For those employees not covered by above, monthly contributions are deposited with Government.

c) Leave Liability:- The liability on account of leave encashment is accounted for on accrual basis.

d) Other benefits comprising of discretionary long service awards are recognized as and when determined.

K. RESEARCH & DEVELOPMENT EXPENDITURE

Revenue expenditure on research and development is charged to the statement of profit and loss. Expenditure, which results in creation of capital asset, is capitalised in the year in which it is incurred and depreciation is provided on such assets as applicable.

L. SHARE / DEBENTURE ISSUE EXPENSES AND DEBENTURE REDEMPTION RESERVE

Issue expenses are adjusted against the Securities Premium Account.

Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

Premium paid / payable on redemption is adjusted against the Securities Premium Account.

M. TAXES ON INCOME

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending 30th June.

Deferred tax is recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

Wealth tax is provided in accordance with the provisions of Wealth Tax Act, 1957.

N. PROVISIONS AND CONTINGENT LIABILITIES

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes.

O. CONSTRUCTION BUSINESS

The company had ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business areas under:- a) Revenue recognition

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

b) Cost recognition

Proportionate cost including estimated cost of completion of real estate sold is recognized in statement of profit and loss and shown separately under the head "Cost of materials”.

c) Valuation of inventory

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower.

Construction work-in-progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.


Jun 30, 2012

A. BASIS OF ACCOUNTING.

a) The financial statements are prepared under the historical cost convention, in accordance with generally accepted accounting principles, the Companies Accounting Standards Rules, 2006 and relevant provisions of Companies Act; 1956.The accounting is on the basis of a going concern concept.

b) The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known/ materialized.

B. REVENUE RECOGNITION.

a) Sales & Services are accounted for net of excise duty, service tax, returns & claims etc.

b) The Company adopts the accrual concept in the preparation of the accounts. Claims/ Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

c) Benefit on account of entitlement to import duty-free raw materials under any Scheme as announced by the government, is estimated and accounted for in the year of export.

d) Industrial promotion subsidy/ government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

C. FIXED ASSETS.

a) Certain Land, Buildings, Plant & Machinery and Moulds & Dies are stated at revalued amounts as a result of their revaluation less depreciation.

b) Other fixed assets are stated at cost less accumulated depreciation and amortization.

c) Interest on borrowings and incidental expenses incurred during the period of construction/installation and till the acquired assets are ready to use are added to the cost of fixed assets.

d) Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

e) The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

D. CAPITAL WORK - IN - PROGRESS AND PREOPERATIVE EXPENSES DURING CONSTRUCTION PERIOD.

Capital Work In Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. DEPRECIATION & AMORTISATION.

TANGIBLE ASSETS

a) Depreciation on Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, except certain specific assets on which depreciation is provided at higher rates based on useful life of the assets estimated by the management.

b) Certain class of assets acquired after 1-7-2009 / 1-7-2010 have been depreciated at rates higher than as specified in Schedule XIV of the Companies Act, 1956 , the details thereof are as under :-

- Injection moulding machines- 8.33% on SLM basis.

- Ancillary Equipments & utilities -14.28% on SLM basis

- Electronic equipments: - 60% on WDV basis

- Computers:-60 % on WDV basis

- Depreciation on additions to the assets during the year is being provided on pro-rata basis from the date of acquisition / installation.

c) Depreciation on assets sold or discarded during the year is being provided on pro- rata basis upto the date on which such assets are sold or discarded.

d) Leasehold Land is amortised over the period of lease.

e) Assets costing upto Rs 5,000/- each are depreciated fully in the year of purchase. INTANGIBLE ASSETS

Cost of software and ERP package and other intangible assets are amortised over a period of four years.

F. INVESTMENTS.

All long term investments are stated at cost. Provision for diminution, if any, in the value of investments is made to recognize a decline, other than temporary, in the opinion of the management.

G. INVENTORIES.

Inventories of plastic goods are valued as under :-

a) Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

b) Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower.

c) Stores, Spare Parts, Packing Materials etc. - at cost using FIFO basis except obsolete and non-moving items stated at net realisable value.

d) Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

e) Inter divisional transfers are valued at works/factory costs of the transferor unit/division, plus transport and other charges.

Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition.

H. ASSETS TAKEN ON LEASE

In respect of operating leases, lease rentals are recognized as an expense in the Statement of Profit & Loss on an accrual basis over the leased term.

In respect of assets obtained on finance leases, assets are recognized at their fair value at the date of acquisition or if lower, at the present value of minimum lease payments. The corresponding liability to the lessor is included in the Balance Sheet as a Finance Lease obligation. The excess of lease payments over the recorded lease obligations are treated as Finance charges which are allocated to each lease term so as to produce a constant rate of charge on the remaining balance of the obligations. The assets are depreciated as owned depreciable assets.

I. FOREIGN CURRENCY TRANSACTIONS.

A. INITIAL RECOGNITION.

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the Statement of Profit & Loss of the year.

B. MEASUREMENT OF FOREIGN CURRENCY ITEMS AT THE BALANCE SHEET DATE.

Foreign currency monetary items of the Company are restated at the closing exchange rates. Non monetary items are recorded at the exchange rate prevailing on the date of the transaction. Exchange differences arising out of these transactions are charged to the Statement of Profit & Loss.

C. FORWARD EXCHANGE CONTRACTS.

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense/ income over the life of the contract. Exchange differences on such contracts are recognized in the Statement of Profit & Loss in the period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or expense for the period.

The Company uses foreign currency forward contracts to hedge its actual underlying exposures and not for trading or speculation purpose. The use of these forward contracts reduces the risk and/or cost to the company.

J. EMPLOYEE BENEFITS.

1. Short Term Benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which related service is rendered.

2. Post Employment Benefits :-

(a) Defined Contribution Plan.

Company's contribution to the superannuation scheme, State Governed Provident Fund Scheme, etc. are recognised during the year in which related service is rendered.

(b) Defined Benefit Plan :- Gratuity.

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognized immediately in the statement of profit and loss. The Gratuity Funds for the employees' are administered by Life Insurance Corporation of India under Group Gratuity Scheme.

Provident Fund.

For few employees, monthly contributions are made to a trust administered by the company. The interest rate payable to the beneficiaries shall not be lower than the statutory rate of interest notified by the government. The company has obligation to make good shortfall, if any, between return on investment of the Trust and rates notified by the Government.

For those employees not covered by above, monthly contributions are deposited with Government.

3. Leave Liability.

The liability on account of leave encashment is accounted for on accrual basis.

K. RESEARCH & DEVELOPMENT EXPENDITURE.

Revenue expenditure on research and development is charged to the statement of profit and loss. Expenditure, which results in creation of capital asset, is capitalised in the year in which it is incurred and depreciation is provided on such assets as applicable.

L. SHARE / DEBENTURE ISSUE EXPENSES AND DEBENTURE REDEMPTION RESERVE.

Issue expenses are adjusted against the Securities Premium Account.

Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

Premium paid / payable on redemption is adjusted against the Securities Premium Account.

M. TAXES ON INCOME.

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending 31st March.

Deferred tax is recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

N. PROVISIONS AND CONTINGENT LIABILITIES.

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes.

O. CONSTRUCTION BUSINESS.

The company has ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business are as under:-

a. Revenue recognition.

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

b. Cost recognition.

Proportionate cost including estimated cost of completion of real estate sold is recognized in statement of profit and loss and shown separately under the head "Cost of materials".

c. Valuation of inventory.

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower.

Construction work in progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.


Jun 30, 2011

A. BASIS OF ACCOUNTING

i. The financial statements are prepared under the historical cost convention, in accordance with generally accepted accounting principles, the Companies Accounting Standards Rules, 2006 and relevant provisions of Companies Act; 1956. The accounting is on the basis of a going concern concept.

ii. The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results are recognized in the year in which the results are known/ materialized.

B. REVENUE RECOGNITION

i. Sales & Services are accounted for net of Excise duty, Service tax, Returns & Claims etc.

ii. The Company adopts the accrual concept in the preparation of the accounts. Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

iii. Benefit on account of entitlement to import duty-free raw materials under any Scheme as announced by the government, is estimated and accounted for in the year of export.

iv. Industrial promotion subsidy / government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

C FIXED ASSETS

i. Certain Land, Buildings, Plant & Machinery and Moulds & Dies are stated at revalued amounts as a result of their revaluation less depreciation.

ii. Other fixed assets are stated at cost less accumulated depreciation and amortisation.

iii. Interest on borrowings and incidental expenses incurred during the period of construction/installation and till the acquired assets are put to use, are added to the cost of fixed assets.

iv. Leasehold land is stated at historical cost less amounts written off proportionate to expired lease period.

v. The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

D. CAPITAL WORK-IN-PROGRESS AND PREOPERATIVE EXPENSES DURING CONSTRUCTION PERIOD

Capital Work In Progress includes expenditure during construction period incurred on projects under implementation treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. DEPRECIATION & AMORTISATION Tangible Assets

i. Depreciation on Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, except certain specific assets on which depreciation is provided at higher rates based on useful life of the assets estimated by the management.

ii. Certain class of assets acquired after 1-7-2009/ 1-7-2010 have been depreciated at rates higher than as specified in Schedule XIV of the Companies Act, 1956 , the details thereof are as under:-

Injection moulding machines - 8.33% on SLM basis.

Ancillary Equipments & utilities -14.28% on SLM basis

Electronic equipments: - 60% on WDV basis

Computers:- 60 % on WDV basis

iii. Depreciation on additions to the assets during the year is being provided on pro-rata basis from the date of acquisition / installation.

iv. Depreciation on assets sold or discarded during the year is being provided on pro-rata basis upto the date on which such assets are sold or discarded.

v. Leasehold Land is amortised over the period of lease.

vi. Assets costing upto Rs. 5,000/- each are depreciated fully in the year of purchase.

Intangible Assets

Cost of software and ERP package is amortised over a period of four years.

F. INVESTMENTS

Investments are stated at cost. Provision for diminution, if any, is made to recognize a decline, other than temporary, in the value of investments as per the opinion of the management.

G. INVENTORIES

Inventories of plastic goods are valued as under:

i. Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

ii. Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower.

iii. Stores, Spare Parts, Packing Materials etc. - at cost using FIFO basis except obsolete and non-moving items stated at net realisable value.

iv. Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

v. Inter divisional transfers are valued either at works/factory costs of the transferor unit/division, plus transport and other charges.

Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition.

H. FOREIGN CURRENCY TRANSACTIONS

(a) All transaction in foreign currency, are recorded at the rates of exchange prevailing on dates when the relevant transactions take place.

(b) Monetary assets and liabilities in foreign currency, outstanding at end of the year, are converted in Indian Currency at appropriate rate of exchange prevailing on date of Balance Sheet. Resultant Gain or Loss is accounted for during the year.

(c) In respect of forward exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognised as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognised as income or expense along with the exchange differences on the underlying assets/liabilities. Profit or loss on cancellations/renewals of forward exchange contracts is recognised during the year.

(d) Non-monetary foreign currency items are carried at cost.

I. EMPLOYEE BENEFITS

1. Short Term Benefits are recognised as an expense at the undiscounted amount in the Profit and Loss Account of the year in which related service is rendered.

2. Post Employment Benefits:

(a) Defined Contribution Plan:

Company's contribution to the superannuation scheme, state governed provident fund scheme, etc. are recognised during the year in which related service is rendered.

(b) Defined Benefit Plan:

- Gratuity

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognised immediately in the Profit and Loss Account. The Gratuity Funds for the employees are administered by Life Insurance Corporation of India under Group Gratuity Scheme.

- Provident Fund

For few employees, monthly contributions are made to a trust administered by the company. The interest rate payable to the beneficiaries is notified by the government. The company has obligation to make good shortfall, if any, between return on investment of the Trust and rates notified by the Government.

For those employees not covered by above, monthly contributions are deposited into Government.

3. Leave Liability

The liability on account of leave encashment is accounted for on accrual basis.

J RESEARCH & DEVELOPMENT EXPENDITURE

Revenue expenditure on research and development is charged to the Profit & Loss Account. Expenditure, which results in creation of capital asset, is capitalised in the year in which it is incurred and depreciation is provided on such assets as applicable.

K. SHARE / DEBENTURE ISSUE EXPENSES AND DEBENTURE REDEMPTION RESERVE

i. Issue expenses are adjusted against the Share Premium Account.

ii. Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

iii. Premium paid / payable on redemption is adjusted against the Share Premium Account.

L. TAXES ON INCOME

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending 31st March 2011.

Deferred tax is recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

M. PROVISIONS AND CONTINGENT LIABILITIES

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes.

N. CONSTRUCTION BUSINESS

The company has ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business are as under:

a. Revenue recognition

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

b. Cost recognition

Proportionate cost including estimated cost of completion of real estate sold is recognized in Profit & Loss Account and shown separately under Cost of materials.

c. Valuation of inventory

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower.

Construction work in progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.


Jun 30, 2010

A. BASIS OF ACCOUNTING

i. The financial statements are prepared under the historical cost convention, in accordance with generally accepted accounting principles, the Companies Accounting Standards Rules, 2006 and relevant provisions of Companies Act; 1956. The accounting is on the basis of a going concern concept.

ii. The preparation of financial statements requires estimates and assumptions to be made that affects the reported amount of assets and liabilities on the date of financial statements and the reported amounts of revenue and expenses during the reported year. Differences between the actual results and estimates are recognized in the year in which the results are known/ materialized.

B. REVENUE RECOGNITION

i. Sales & Services are accounted for net of excise duty, service tax, returns & claims etc.

ii. The Company adopts the accrual concept in the preparation of the accounts. Claims / Refunds not ascertainable with reasonable certainty are accounted for, on final settlement.

iii. Benefit on account of entitlement to import duty-free raw materials under any Scheme as announced by the government, is estimated and accounted for in the year of export.

iv. Industrial promotion subsidy / government grants are recognized on accrual basis on compliance of stipulated conditions as notified under the respective scheme.

C. FIXED ASSETS

i. Certain Land, Buildings, Plant & Machinery and Moulds & Dies are stated at revalued amounts as a result of their revaluation less depreciation.

ii. Other fixed assets are stated at cost less accumulated depreciation and amortisation.

iii. Interest on borrowings and incidental expenses incurred during the period of construction/installation and till the acquired assets are put to use, are added to the cost of fixed assets.

iv. The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the profit and loss account. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

D. CAPITAL WORK-IN-PROGRESS AND PREOPERATIVE EXPENSES DURING CONSTRUCTION PERIOD

Capital Work In Progress includes expenditure during construction period incurred on projects under implementation is treated as pre-operative expenses pending allocation to the assets. These expenses are apportioned to the respective fixed assets on their completion / commencement of commercial production.

E. DEPRECIATION & AMORTISATION Tangible Assets

i. Depreciation on Building, Plant & Machinery and Moulds & Dies is provided on Straight Line Method and on other assets on Written Down Value Method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, except certain specific assets on which depreciation is provided at higher rates based on useful life of the assets estimated by the management.

ii. Certain class of assets acquired after 1-7-2009 have been depreciated at rates higher than as specified in Schedule XIV of the Companies Act, 1956, the details thereof are as under

Injection moulding machines- 8.33% on SLM basis.

Electronic equipments: - 60% on WDV basis

Computers:- 60 % on WDV basis

iii. Depreciation on additions to the assets during the year is being provided on pro-rata basis from the date of acquisition / installation.

iv. Depreciation on assets sold or discarded during the year is being provided on pro-rata basis upto the date on which such assets are sold or discarded.

v. Leasehold Land is amortised over the period of lease.

vi. Assets costing upto I 5,000/- each are depreciated fully in the year of purchase.

Intangible Assets

Cost of software and ERP package is amortised over a period of four years.

F. INVESTMENTS

Investments are stated at cost. Provision for diminution, if any, in the value of investments is made to recognize decline other than temporary in the opinion of the management.

G. INVENTORIES

Inventories of plastic goods are valued as under:

i. Raw Material & Components - at cost using identified lot basis / First in first out (FIFO) or net realizable value whichever is lower.

ii. Finished Goods - at cost using weighted average cost basis or net realisable value whichever is lower.

iii. Stores, Spare Parts, Packing Materials etc. - at cost using FIFO basis except obsolete and non-moving items stated at net realisable value.

iv. Goods for Resale - at cost using FIFO basis or net realisable value whichever is lower.

v. Inter divisional transfers are valued either at works/factory costs of the transferor unit/division, plus transport and other charges.

Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventory to their respective present location and condition.

H. FOREIGN CURRENCY TRANSACTIONS

(a) All transaction in foreign currency, are recorded at the rates of exchange prevailing on dates when the relevant transactions take place.

(b) Monetary assets and liabilities in foreign currency, outstanding at end of the year, are converted in Indian Currency at appropriate rate of exchange prevailing on date of Balance Sheet. Resultant Gain or Loss is accounted for during the year.

(c) In respect of forward exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognised as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognised as income or expense along with the exchange differences on the underlying assets/liabilities. Profit or loss on cancellations/renewals of forward exchange contracts is recognised during the year.

(d) Non-monetary foreign currency items are carried at cost.

I. EMPLOYEE BENEFITS

1. Short Term Benefits are recognised as an expense at the undiscounted amount in the Profit and Loss Account of the year in which related service is rendered.

2. Post Employment Benefits:

(a) Defined Contribution Plan:

Companys contribution to the superannuation scheme, state governed provident fund scheme, etc. are recognised during the year in which related service is rendered.

(b) Defined Benefit Plan: – Gratuity

The present value of obligation is determined based on an actuarial valuation, using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognised immediately in the Profit and Loss Account. The Gratuity Funds for the employees are administered by Life Insurance Corporation of India under Group Gratuity Scheme.

– Provident Fund

For few employees, monthly contributions are made to a trust administered by the company. The interest rate payable to the beneficiaries is notified by the government. The company has obligation to make good shortfall, if any, between return on investment of the Trust and rates notified by the Government.

For those employees not covered by above, monthly contributions are deposited into Government.

3. Leave Liability

The liability on account of leave encashment is accounted for on accrual basis.

J. RESEARCH & DEVELOPMENT EXPENDITURE

Revenue expenditure on research and development is charged to the Profit & Loss Account. Expenditure, which results in creation of capital asset, is capitalised in the year in which it is incurred and depreciation is provided on such assets as applicable.

K. SHARE / DEBENTURE ISSUE EXPENSES AND DEBENTURE REDEMPTION RESERVE

i. Issue expenses are adjusted against the Share Premium Account.

ii. Debenture Redemption Reserve is created pursuant to SEBI (Disclosure and Investor Protection) Guidelines, 2000.

iii. Premium paid / payable on redemption is adjusted against the Share Premium Account.

L. TAXES ON INCOME

Current tax is determined based on the amount of tax payable in respect of taxable income for the financial year ending 31st March, 2010.

Deferred tax is recognised, subject to consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets, are recognized only to the extent there is virtual certainty supported by convincing evidence of its realization.

M. PROVISIONS AND CONTINGENT LIABILITIES

Provisions involving substantial degree of estimation in measurement are recognized when there is a permanent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes.

N. CONSTRUCTION BUSINESS

The company has ventured into real estate development business and thus the accounting policies relevant specifically in relation to construction business are as under:

a. Revenue recognition

Income from real estate sales is recognized on the transfer of all significant risk and rewards of ownership to the buyers and is not unreasonable to expect ultimate collection and no significant uncertainty exists regarding the amount of consideration.

b. Cost recognition

Proportionate cost including estimated cost of completion of real estate sold is recognized in Profit & Loss Account and shown separately under Cost of materials.

c. Valuation of inventory

Finished / under construction inventory of real estate is stated at cost or net realizable value whichever is lower.

Construction work in progress includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

Other accounting policies, wherever applicable, are same as followed in normal course of business.

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