Mar 31, 2016
14. SIGNIFICANT ACCOUNTING POLICIES a. Accounting assumption
The financial statements are drawn up in accordance with the historical cost convention on accrual basis and comply with the accounting standards referred to in Section 129 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014.
b. Employees benefits
The Company has adopted Accounting Standard 15 (Revised 2005) issued by the Institute of Chartered Accountants of India (ICAI) on ''Employees Benefits''. Accordingly, the Company has provided for liability on account of all following employees benefits available to the employees in accordance with the applicable rules, regulations, laws and employees benefits policy of the Company.
i) Provident fund is a defined contribution scheme and the contributions are charged to the profit & loss account of the year when the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for on the basis of an actuarial valuation as per projected unit credit method, made at the end of each financial year. The Company has taken a policy with the Life Insurance Corporation of India (LIC) to cover the gratuity liability of the employees and premium paid to the LIC is charged to profit and loss account. The difference between the actuarial valuation of the gratuity liability of the employees at the year end and the balance of funds with LIC is provided for as liability in the books.
iii) Employees are entitled to short-term compensated absences, which are provided for on the basis of estimates.
iv) Actuarial gains/losses are immediately taken to the profit and loss account and are not deferred.
c. Fixed assets
All fixed assets including intangible assets are stated at cost of acquisition less accumulated depreciation. Cost includes inward freight, duties, taxes and expenses incidental to acquisition and installation.
In accordance with Accounting Standard 28 issued by the Institute of Chartered Accountants of India, consideration is given at the date of balance sheet to determine whether there is any indication of impairment of the carrying amount of the Company''s fixed assets to recognize impairment loss. However, during the financial year under reporting, there is no indication which gives an expression of impairment loss in carrying amount of the Company''s fixed assets.
d. Depreciation and amortization
Depreciation on fixed assets has been provided on straight line method at the rates prescribed in Schedule II of the Companies Act, 2013, except for intangible assets, which are amortized over the respective individual estimated useful lives on a straight line basis, commencing from the date, the asset is put to use by the Company. Depreciation on additions/ deletions is provided on pro-rata basis from/ to the date of additions / deletions. The management estimates the useful lives for intangible assets as follows:
Technical know-how : 4 years Software : 6years
e. Inventories valuation
Inventories include raw material and semi finished goods. Inventories have been valued at cost or net realizable value, whichever is lower. The cost is calculated on first-in-first-out (FIFO) basis.
f. Transactions of foreign currencies
All transactions in foreign currency during the year are recorded at the rates of exchange prevailing on the date when the relevant transaction took place. Loss/Gain arising on settlement of such transactions is accounted for in the year of settlement. Monetary assets and liabilities are converted into functional currency i.e., INR, at the rate of exchange prevailing at balance sheet date and the exchange rate fluctuation is recognized as gain or loss on unrealized exchange rate fluctuation.
g. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered Accountants of India, investments of a long-term nature are stated at cost. Current investments are valued at lower of cost and fair value.
h. Revenue recognition
Sale is recognized, when the significant risks and rewards of the ownership of the goods are transferred to the customer and is stated if applicable, net of trade discounts, duties and taxes. Other income is accounted for on accrual basis.
i. Income tax
Provision for current income tax liability is made on estimated taxable income under Income Tax Act, 1961 after considering permissible tax exemptions, deductions and allowances. The Minimum Alternate Tax (MAT) if payable in accordance with the tax laws, which gives rise to future benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal tax. Deferred assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.
j. Lease
Operating lease payments are recognized as an expense on straight line basis over the term of the lease.
k. Contingent liabilities and provisions
The Company makes a provision when there is a present obligation as a result of a past event where the outflow of economic resources is probable and a reliable estimate of the amount of obligation can be made. A disclosure is made for possible or present obligations that may but probably will not require outflow of resources or where a reliable estimate cannot be made, as a contingent liability in the financial statements.
l. Use of estimates
In preparing the Company''s financial statements in conformity with accounting principles generally accepted in India, the management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Any revision to accounting estimates is recognized prospectively in current and future periods.
m. Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and weighted average number of equity shares outstanding during the period are adjusted for the effect of all dilutive potential equity shares.
n. Segment reporting
The Company''s operating geographical business segment is based on the locations of customers. Allocable costs are allocated to each segment in proportion to the relative sales of each segment. All the common income, expenses, assets and liabilities, which are not possible to be allocated to different segments, are treated as un-allocable items.
The management believes that the claim made is untenable and is contesting before appellate authority. As of the reporting date, the management is unable to determine the ultimate outcome of above matters. In the event, the revenue authorities succeed with enforcement of their assessments, there shall be an adverse effect on the net income, however, it should not make any material impact on the cash-flow of the Company, as the various other undisputed refund dues are substantially sufficient to settle the above claim.
Mar 31, 2015
A. Accounting assumption
The financial statements are drawn up in accordance with the historical
cost convention on accrual basis and comply with the accounting
standards referred to in Section 129 of the Companies Act, 2013 read
with Companies (Accounts) Rules, 2014.
b. Employees benefits
The Company has adopted Accounting Standard 15 (Revised 2005) issued by
the Institute of Chartered Accountants of India (ICAI) on 'Employees
Benefits'. Accordingly, the Company has provided for liability on
account of all following employees benefits available to the employees
in accordance with the applicable rules, regulations, laws and
employees benefits policy of the Company.
i) Provident fund is a defined contribution scheme and the
contributions are charged to the profit &- loss account of the year when
the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for
on the basis of an actuarial valuation as per projected unit credit
method, made at the end of each financial year. The Company has taken a
policy with the Life Insurance Corporation of India (LIC) to cover the
gratuity liability of the employees and premium paid to the LIC is
charged to Profit and Loss Account. The difference between the
actuarial valuation of the gratuity liability of the employees at the
year end and the balance of funds with LIC is provided for as liability
in the books.
in) Employees are entitled to short-term compensated absences, which
are provided for on the basis of estimates.
iv) Actuarial gains/losses are immediately taken to the profit and loss
account and are not deferred.
c. Fixed assets
All fixed assets including intangible assets are stated at cost of
acquisition less accumulated depreciation. Cost includes inward
freight, duties, taxes and expenses incidental to acquisition and
installation.
In accordance with Accounting Standard 28 issued by the Institute of
Chartered Accountants of India, consideration is given at the date of
balance sheet to determine whether there is any indication of
impairment of the carrying amount of the Company's fixed assets to
recognize impairment loss. However, during the financial year under
reporting, there is no indication which gives an expression of
impairment loss in carrying amount of the Company's fixed assets.
d. Depreciation and amortization
Depreciation on fixed assets has been provided on straight line method
at the rates prescribed in Schedule II of the Companies Act, 2013,
except for intangible assets, which are amortized over the respective
individual estimated useful lives on a straight line basis, commencing
from the date, the asset is put to use by the Company. Depreciation on
additions/ deletions is provided on pro-rata basis from/ to the date of
additions / deletions. The management estimates the useful lives for
intangible assets as follows:
Technical know-how : 4 years Software : 6years
e. Inventories valuation
Inventories include raw material and semi finished goods. Inventories
have been valued at cost or net realizable value, whichever is lower.
The cost is calculated on first-in-first-out (FIFO) basis.
f. Transactions of foreign currencies
All transactions in foreign currency during the year are recorded at
the rates of exchange prevailing on the date when the relevant
transaction took place. Loss/Cain arising on settlement of such
transactions is accounted for in the year of settlement. Monetary
assets and liabilities are converted into functional currency i.e.,
INR, at the rate of exchange prevailing at balance sheet date and the
exchange rate fluctuation is recognized as gain or loss on unrealized
exchange rate fluctuation.
g. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered
Accountants of India, investments of a long-term nature are stated at
cost. Current investments are valued at lower of cost and fair value.
h. Revenue recognition
Sale is recognized, when the significant risks and rewards of the
ownership of the goods are transferred to the customer and is stated if
applicable, net of trade discounts, duties and taxes. Other income is
accounted for on accrual basis.
i. Income tax
Provision for current income tax liability is made on estimated taxable
income under Income Tax Act, 1961 after considering permissible tax
exemptions, deductions and allowances. The Minimum Alternate Tax (MAT)
if payable in accordance with the tax laws, which gives rise to future
benefits in the form of adjustment of future income tax liability is
considered as an asset if there is convincing evidence that the Company
will pay normal tax. Deferred assets are recognized only if there is
reasonable certainty that they will be realized and are reviewed for
the appropriateness of their respective carrying values at each balance
sheet date.
j. Lease
Operating lease payments are recognized as an expense on straight line
basis over the term of the lease.
k. Contingent liabilities and provisions
The Company makes a provision when there is a present obligation as a
result of a past event where the outflow of economic resources is
probable and a reliable estimate of the amount of obligation can be
made. A disclosure is made for possible or present obligations that may
but probably will not require outflow of resources or where a reliable
estimate cannot be made, as a contingent liability in the financial
statements.
I. Use of estimates
In preparing the Company's financial statements in conformity with
accounting principles generally accepted in India, the management is
required to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Any
revision to accounting estimates is recognized prospectively in current
and future periods.
m. Earning per share
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
weighted average number of equity shares outstanding during the period
are adjusted for the effect of all dilutive potential equity shares.
n. Segment reporting
The Company's operating geographical business segment is based on the
locations of customers. Allocable costs are allocated to each segment
in proportion to the relative sales of each segment. All the common
income, expenses, assets and liabilities, which are not possible to be
allocated to different segments, are treated as un-allocable items.
The Income Tax Department, in all its notices of demand, has challenged
the validity of the approval and registration granted by Software
Technology Park of India (STPI), Ministry of Communications, to the
Company as a 100% Export Oriented Unit (EOU) under the Electronic
Hardware Technology Park (EHTP) Scheme for the purpose of grant of any
relief under the Income Tax Act, 1961.
On appeals filed by the Income Tax Department, the Hon'ble Delhi High
Court has reversed the erstwhile orders of Income Tax Appellate
Tribunal (ITAT), Delhi, and referred back the matters to the ITAT to
examine alternate claims of Company. The ITAT has further restored the
matter to the Assessing Officer to assess the alternate claims of the
Company with its observations.
The Company has also filed special leave petitions before the Hon'ble
Supreme Court against the order of the Hon'ble Delhi High Court, which
is sub-judice as at reporting date.
The other contingent liability represents the demand of Central Excise
Department for charges of Cost Recovery Officer. The Company has filed
an appeal before the Tribunal, as no such of ficer was ever appointed
by the Revenue Department.
Based on the decisions of appellate authorities given in favour of
Company and legal opinion taken by the Company and discussions with the
solicitors, the Company believes that there is fair chance of decisions
in favor of the Company in respect of items listed above, hence, no
provision is considered necessary against the same.
Mar 31, 2014
A. Accounting assumption
The financial statements are drawn up in accordance with the historical
cost convention on accrual basis and comply with the accounting
standards referred to in Section 211 (3C) of the Companies Act, 1956
read with Companies (Accounting Standards) Rules, 2006.
b. Employees benefits
The Company has adopted Accounting Standard 15 (Revised 2005) issued by
the Institute of Chartered Accountants of India (ICAI) on ''Employees
Benefits''. Accordingly, the Company has provided for liability on
account of all following employees benefits available to the employees
in accordance with the applicable rules, regulations, laws and
employees benefits policy of the Company:
i) Provident fund is a defined contribution scheme and the
contributions are charged to the profit & loss account of the year when
the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for
on the basis of an actuarial valuation as per projected unit credit
method, made at the end of each financial year. The Company has
takenapolicy with the Life Insurance Corporation of India (LIC) to
cover the gratuity liability of the employees and premium paid to the
LIC is charged to Profit and Loss Account. The difference between the
actuarial valuation of the gratuity liability of the employees at the
year end and the balance of funds with LIC is provided for as liability
inthe books.
iii) Employees are entitled to short-term compensated absences, which
are provided for on the basis of estimates.
iv) Actuarial gains / losses are immediately taken to the profit and
loss account and are not deferred.
c. Fixed assets
All fixed assets including intangible assets are stated at cost of
acquisition less accumulated depreciation. Cost includes inward
freight, duties, taxes and expenses incidental to acquisition and
installation.
In accordance with Accounting Standard 28 issued by the Institute of
Chartered Accountants of India, consideration is givenatthe date
ofbalance sheet to determine whether there is any indication of
impairment of the carrying amount of the Company''s fixed assets to
recognize impairment loss. However, during the financial year under
reporting, there is no indication which gives an expression of
impairment loss in carrying amount of the Company''s fixed assets.
d. Depreciation and amortization Depreciation on fixed assets has been
provided on straight line method at the rates prescribed in Schedule
XIV of the Companies Act, 1956, except for intangible assets, which are
amortized over the respective individual estimated useful lives on a
straight line basis, commencing from the date the asset is put to use
by the Company. Depreciation on additions / deletions is provided on
pro-rata basis from / to the date of additions / deletions. The
management estimates the useful lives for intangible assets as follows:
Technical know-how : 4years Software : 6years
e. Inventories valuation
Inventories include raw material and semi-finished goods. Inventories
have been valued at cost or net realizable value, whichever is lower.
The cost is calculated on first-in-first-out (FIFO) basis.
f. Transactions of foreign currencies All transactions in foreign
currency during the year are recorded at the rates of exchange
prevailing onthe date when the relevant transaction took place. Loss /
Gain arising on settlement of such transactions is accounted for in the
year of settlement. Monetary assets and liabilities are converted into
functional currency, i.e., INR, at the rate of exchange prevailing at
balance sheet date and the exchange rate fluctuation is recognized as
gain or loss on unrealized exchange rate fluctuation.
g. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered
Accountants of India, investments of a long-term nature are stated at
cost. Current investments are valued at lower of cost and fair value.
h. Revenue recognition
Sale is recognized, when the significant risks and rewards of the
ownership of the goods are transferred to the customer and is stated if
applicable, net of trade discounts, duties and taxes. Other
income is accounted foronaccrual basis.
i. Income tax
Provision for current income tax liability is made on estimated taxable
income under Income Ta x Act, 1961 after considering permissible tax
exemptions, deductions and allowances. The Minimum Alternate Tax (MAT)
if payable in accordance with the tax laws, which gives rise to future
benefits in the form of adjustment of future income tax liability, is
considered as an asset if there is convincing evidence that the Company
will pay normal tax. Deferred assets are recognized only if there is
reasonable certainty that they willbe realized and are reviewed for the
appropriateness of their respective carrying valuesateach balance sheet
date.
j. Lease
Operating lease payments are recognized as an expense on straight line
basis over the term ofthe lease.
k. Contingent liabilities and provisions The Company makes a provision
when there is a present obligation as a result of a past event where
the outflow of economic resources is probable and a reliable estimate
of the amount of obligation can be made. A disclosure is made for
possible or present obligations that may, but probably will not require
outflow of resources or where a reliable estimate cannot be made, as a
contingent liability in the financial statements.
l. Use of estimates
In preparing the Company''s financial statements in conformity with
accounting principles generally accepted in India, the management is
required to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent
liabilities at the date of the financial statements and the reported
amounts ofrevenues and expenses during the reporting period. Any
revision to accounting estimates is recognized prospectively incurrent
and future periods.
m. Earning per share
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
weighted average number of equity shares outstanding during the period
are adjusted for the effectofall dilutive potential equity shares.
n. Segment reporting
The Company''s operating geographical business segment is based on the
locations of customers. Allocable costs are allocated to each segment
in proportion to the relative sales of each segment. All the common
income, expenses, assets and liabilities, which are not possible to be
allocated to different segments, are treated as un-allocable items.
Mar 31, 2013
A. Accounting assumption
The financial statements are drawn up in accordance with the historical
cost convention on accrual basis and comply with the accounting
standards referred to in Section 211 (3C) of the Companies Act, 1956
read with Companies (AccountingStandards) Rules, 2006.
b. Employees benefits
The Company has adopted Accounting Standard 15 (Revised 2005) issued by
the Institute of Chartered Accountants of India (ICAI) on ''Employees
Benefits''. Accordingly, the Company has provided for liability on
account of all following employees benefits available to the employees
in accordance with the applicable rules, regulations, laws and
employees benefits policy of the Company:
i) Provident fund is a defined contribution scheme and the
contributions are charged to the profit & loss account of the year when
the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for
on the basis of an actuarial valuation as per projected unit credit
method, made at the end of each financialyear. The Company has taken a
policy with the Life Insurance Corporation of India (LIC) to cover the
gratuity liability of the employees and premium paid to the LIC is
charged to Profit and Loss Account. The difference between the
actuarial valuation of the gratuity liability of the employees at the
year end and the balance of funds with LIC is provided for as liability
inthebooks.
ill) Employees are entitled to short-term compensated absences, which
are provided for on the basis of estimates.
iv) Actuarial gains / losses are immediately taken to the profit
andloss account and are not deferred.
c. Fixed assets
All fixed assets including intangible assets are stated at cost of
acquisition less accumulated depreciation. Cost includes inward
freight, duties, taxes and expenses incidental to acquisition and
installation.
In accordance with Accounting Standard 28 issued by the Institute of
Chartered Accountants of India, consideration is given at the date of
balance sheet to determine whether there is any indication of
impairment of the carrying amount of the Company''s fixed assets to
recognize impairment loss. However, during the financial year under
reporting, there is no indication which gives an expression of
impairment loss in carrying amount of the Company''s fixed assets.
d. Depreciation and amortization
Depreciation on fixed assets has been provided on straight line method
at the rates prescribed in Schedule XIV of the Companies Act, 1956,
except for intangible assets, which are amortized over the respective
individual estimated useful lives on a straight line basis, commencing
from the date the asset is put to use by the Company. Depreciation on
additions / deletions is provided on pro-rata basis from / to the date
of additions / deletions. The management estimates the useful lives for
intangible assets as follows:
Technical know-how : 4 years Software : 6years
e. Inventoriesvaluation
Inventories include raw material and semi-finished goods. Inventories
have been valued at cost or net realizable value, whichever is lower.
The cost is calculated on first in first out (FIFO) basis.
f. Transactions of foreign currencies
All transactions in foreign currency during the year are recorded at
the rates of exchange prevailing on the date when the relevant
transaction took place. Loss / Gain arising on settlement of such
transactions is accounted for in the year of settlement. Monetary
assets and liabilities are converted into functional currency, i.e.,
INR, at the rate of exchange prevailing at balance sheet date and the
exchange rate fluctuation is recognized as gain or loss on unrealized
exchange rate fluctuation.
g. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered
Accountants of India, investments of a long-term nature are stated at
cost. Current investments are valued at lowercostandfairvalue.
h. Revenue recognition
Sale is recognized, when the significant risks and rewards of the
ownership of the goods are transferred to the customer and is stated if
applicable, net of trade discounts, duties and taxes. Other income is
accounted for on accrual basis.
i. Income tax
Provision for current income tax liability is made on estimated taxable
income under Income Tax Act, 1961 after considering permissible tax
exemptions, deductions and allowances. The Minimum Alternate Tax (MAT)
if payable in accordance with the tax laws, which gives rise to future
benefits in the form of adjustment of future income tax liability, is
considered as an asset if there is convincing evidence that the Company
will pay normal tax. Deferred assets that they will be realized and are
reviewed for the appropriateness of their respective carrying values at
each balance sheet date.
j. Lease
Operating lease payments are recognized as an expense on straight line
basis over the term of the lease.
k. Contingent liabilities and provisions
The Company makes a provision when there is a present obligation as a
result of a past event where the outflow of economic resources is
probable and a reliable estimate of the amount of obligation can be
made. A disclosure is made for possible or present obligations that
may, but probably will not require outflow of resources or where a
reliable estimate cannot be made, as a contingent liability in the
financial statements.
I. Use of estimates
In preparing the Companys financial statements in conformity with
accounting principles generally accepted in India, management is
required to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Any
revision to accounting estimates is recognized prospectively in current
and future periods.
m. Earning per share
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
weighted average number of equity shares outstanding during the period
are adj usted for the effect of all dilutivepotentialequityshares.
n. Segment reporting
The Companys operating geographical business segment is based on the
locations of customers. Allocable costs are allocated to each segment
in proportion to the relative sales of each segment. All the common
income, expenses, assets and liabilities, which are not possible to be
allocated to different segments, are treated as un-allocable items.
Mar 31, 2012
A. Accounting assumption
The financial statements are drawn up in accordance with the historical
cost convention on accrual basis and comply with the accounting
standards referred to in Section 211 (3C) of the Companies Act, 1956
read with Companies (Accounting Standards) Rules, 2006.
b. Employees benefits
The Company has adopted Accounting Standard 15 (Revised 2005) issued by
the Institute of Chartered Accountants of India (ICAI) on Employees
Benefits. Accordingly, the Company has provided for liability on
account of all following employees benefits available to the employees
in accordance with the applicable rules, regulations, laws and
employees benefits policy of the Company:
i) Provident fund is a defined contribution scheme and the
contributions are charged to the profit & loss account of the year when
the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for
on the basis of an actuarial valuation as per projected unit credit
method, made at the end of each financial year. The Company has taken a
policy with the Life Insurance Corporation of India (LIC) to cover the
gratuity liability of the employees and premium paid to the LIC is
charged to Profit and Loss Account. The difference between the
actuarial valuation of the gratuity liability of the employees at the
year end and the balance of funds with LIC is provided for as liability
in the books.
iii) Employees are entitled to short-term compensated absences, which
are provided for on the basis of estimates.
iv) Actuarial gains / losses are immediately taken to the profit and
loss account and are not deferred.
c. Fixed assets
All fixed assets including intangible assets are stated at cost of
acquisition less accumulated depreciation. Cost includes inward
freight, duties, taxes and expenses incidental to acquisition and
installation.
In accordance with Accounting Standard 28 issued by the Institute of
Chartered Accountants of India, consideration is given at the date of
balance sheet to determine whether there is any indication of
impairment of the carrying amount of the Companys fixed assets to
recognize impairment loss. However, during the financial year under
reporting, there is no indication which gives an expression of
impairment loss in carrying amount of the Company's fixed assets.
d. Depreciation and amortization Depreciation on fixed assets has been
provided on straight line method at the rates prescribed in Schedule
XIV of the Companies Act, 1956, except for intangible assets, which are
amortized over the respective individual estimated useful lives on a
straight line basis, commencing from the date the asset is put to use
by the Company. Depreciation on additions / deletions is provided on
pro-rata basis from / to the date of additions / deletions. The
management estimates the useful lives for intangible assets as follows:
Technical know-how : 4 years
Software : 6 years
e. Inventories valuation
Inventories include raw material and semi-finished goods. Inventories
have been valued at cost or net realizable value, whichever is lower.
The cost is calculated on first in first out (FIFO) basis.
f. Transactions of foreign currencies
All transactions in foreign currency during the year are recorded at
the rates of exchange prevailing on the date when the relevant
transaction took place. Loss / Gain arising on settlement of such
transactions is accounted for in the year of settlement. Monetary
assets and liabilities are converted into functional currency, i.e.,
INR, at the rate of exchange prevailing at balance sheet date and the
exchange rate fluctuation is recognized as gain or loss on unrealized
exchange rate fluctuation.
g. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered
Accountants of India, investments of a long-term nature are stated at
cost. Current investments are valued at lower cost and fair value.
h. Revenue recognition
Sale is recognized, when the significant risks and rewards of the
ownership of the goods are transferred to the customer and is stated if
applicable, net of trade discounts, duties and taxes. Other income is
accounted for on accrual basis.
i. Income tax
Provision for current income tax liability is made on estimated
taxable income under Income Tax Act, 1961 after considering permissible
tax exemptions, deductions and allowances. The Minimum Alternate Tax
(MAT) if payable in accordance with the tax laws, which gives rise to
future benefits in the form of adjustment of future income tax
liability, is considered as an asset if there is convincing evidence
that the Company will pay normal tax. Deferred assets are recognized
only if there is reasonable certainty that they will be realized and
are reviewed for the appropriateness of their respective carrying
values at each balance sheet date.
j. Lease
Operating lease payments are recognized as an expense on straight line
basis over the term of the lease.
k. Contingent liabilities and provisions The Company makes a provision
when there is a present obligation as a result of a past event where
the outflow of economic resources is probable and a reliable estimate
of the amount of obligation can be made. A disclosure is made for
possible or present obligations that may, but probably will not require
outflow of resources or where a reliable estimate cannot be made, as a
contingent liability in the financial statements.
Use of estimates In preparing the Company's financial statements in
conformity with accounting principles generally accepted in India,
management is required to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of
contingent liabilities at the date of the financial statements and the
reported amounts of
revenues and expenses during the reporting period. Any revision to
accounting estimates is recognized prospectively in current and future
periods.
m. Earning per share
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
weighted average number of equity shares outstanding during the period
are adjusted for the effect of all dilutive potential equity shares.
n. Segment reporting
The Company's operating geographical business segment is based on the
locations of customers. Allocable costs are allocated to each segment
in proportion to the relative sales of each segment. All the common
income, expenses, assets and liabilities, which are not possible to be
allocated to different segments, are treated as un-allocable items.
Mar 31, 2010
The financial statements are drawn up in accordance with the historical
cost convention on accrual basis and comply with the accounting
standards referred to in Sec 211 (3C) of the Companies Act, 1956 read
with Companies (Accounting Standards) Rules, 2006.
The Company has adopted Accounting Standard 15 (Revised 2005) issued by
the Institute of Chartered Accountants of India (ICAI) on Employees
Benefits. Accordingly, the Company has provided for liability on
account of all following employees benefits available to the employees
in accordance with the applicable rules, regulations, laws and
employees benefits policy of the Company:
i) Provident fund is a defined contribution scheme and the
contributions are charged to the profit & loss account of the year when
the contributions to the government funds are due.
ii) Gratuity liability is a defined benefit obligation and provided for
on the basis of an actuarial valuation as per projected unit credit
method, made at the end of each financial year. The Company has taken a
policy with the Life Insurance Corporation of India (LIC) to cover the
gratuity liability of the employees and premium paid to the LIC is
charged to Profit and Loss Account. The difference between the
actuarial valuation of the gratuity liability of the employees at the
year end and the balance of funds with LIC is provided for as liability
in the books.
iii) Employees are entitled to short-term compensated absences, which
are provided for on the basis of estimates.
iv) Actuarial gains / losses are immediately taken to the profit and
loss account and are not deferred.
All fixed assets including intangible assets are stated at cost of
acquisition less accumulated depreciation. Cost includes inward
freight, duties, taxes and expenses incidental to acquisition and
installation.
In accordance with Accounting Standard 28 issued by the Institute of
Chartered Accountants of India, consideration is given at the date of
balance sheet to determine whether there is any indication of impair
-ment of the carrying amount of the Companys fixed assets to recognize
impairment loss. However, during the financial year under reporting,
there is no indication which gives an expression of impairment loss in
carrying amount of the Company fixed assets.
4. Depreciation and amortization
Depreciation on fixed assets has been provided on straight line method
at the rates prescribed in Schedule XIV of the Companies Act, 1956,
except for intangible assets, which are amortized over the respective
individual estimated useful lives on a straight line basis, commencing
from the date the asset is put to use by the Company. Depreciation on
additions / deletions is provided on pro-rata basis from / to the date
of additions / deletions. The management estimates the useful lives for
intangible assets as follows:
Technical know-how : 4 years
Software : 6 years
5. Inventories valuation
Inventories include raw material and semi-finished goods. Inventories
have been valued at cost or net realizable value, whichever is lower.
The cost is calculated on first in first out (FIFO) basis.
6. Transactions of foreign currencies
All transactions in foreign currency during the year are recorded at
the rates of exchange prevailing on the date when the relevant
transaction took place. Loss / Gain arising on settlement of such
transactions is accounted for in the year of settlement. Monetary
assets and liabilities are converted into functional currency i.e. INR,
at the rate of exchange prevailing at balance sheet date and the
exchange rate fluctuation is recognized as gain or loss on unrealized
exchange rate fluctuation.
7. Investments
As per the Accounting Standard 13 issued by the Institute of Chartered
Accountants of India, investments of a long-term nature are stated at
cost. Current investments are valued at lower of cost and fair value.
8. Miscellaneous expenditure
Preliminary expenses are amortized over a period of ten years.
9. Revenue recognition
Sale is recognized, when the significant risks and rewards of the
ownership of the goods are transferred to the customer and is stated if
applicable, net of trade discounts, duties and taxes. Other income is
accounted for on accrual basis.
10. Income tax
Provision for current income tax liability is made on
estimated taxable income under Income Tax Act, 1961 after considering
permissible tax exemptions, deductions and allowances. The Minimum
Alternate Tax (MAT) if payable in accordance with the tax laws, which
gives rise to future benefits in the form of adjustment of future
income tax liability, is considered as an asset if there is convincing
evidence that the Company will pay normal tax. Deferred assets are
recognized only if there is reasonable certainty that they will be
realized and are reviewed for the appropriateness of their respective
carrying values at each balance sheet date.
11. Lease
Operating lease payments are recognized as an expense on straight line
basis over the term of the lease.
12. Contingent liabilities and provisions
The Company makes a provision when there is a present obligation as a
result of a past event where the outflow of economic resources is
probable and a reliable estimate of the amount of obligation can be
made. A disclosure is made for possible or present obligations that may
but probably will not require outflow of resources or where a reliable
estimate cannot be made, as a contingent liability in the financial
statements.
13. Use of estimates
In preparing the Companys financial statements in conformity with
accounting principles generally accepted in India, management is
required to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Any
revision to accounting estimates is recognized prospectively in current
and future periods.
14. Earning per share
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
weighted average number of equity shares outstanding during the period
are adjusted for the effect of all dilutive potential equity shares.
15. Segment reporting
The Companys operating geographical business segment is based on the
locations of customers. Allocable costs are allocated to each segment
in proportion to the relative sales of each segment. All the common
income, expenses, assets and liabilities, which are not possible to be
allocated to different segments, are treated as un-allocable items.