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Accounting Policies of Wim Plast Ltd. Company

Mar 31, 2016

1. Company Overview:

The company is carrying the manufacturing activity of Plastic Moulded Furniture, Plastic Extrusion Sheets, Moulds and Air Coolers having the manufacturing units at Daman, Baddi, Chennai, Haridwar and Kolkata and Corporate Office in Mumbai.

2. Significant Accounting Policies

a. Basis of Preparation of Financial Statement

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The Financial Statements of the Company are prepared in accordance with the Section 129 of Companies Act, 2013 and accounting principles generally accepted, the Accounting Standards specified under Section 133 of the Companies Act, 2013 and Rule 7 of the Companies (Accounts) Rules, 2014.

b. Use of Estimates

Accounting estimate could change from period to period and actual result could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

c. Fixed Assets :

Fixed assets (other than “Freehold land” where no depreciation is charged) are stated at cost less accumulated depreciation. Cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition for the intended use. Cenvat Receivable and Value added tax, if any on plant & machinery and moulds have been reduced from the cost of acquisition of the said assets. The amount of Capital Work in Progress is valued at Cost.

d. Depreciation :

(a) Depreciation on Fixed Assets is provided on life assigned to each assets in accordance with the Schedule - II of the Companies Act, 2013. Depreciation on tangible assets is provided on the straight line method except for Plant & Machinery and Moulds which is based on technical evaluation. Management believes that these useful lives present the period over which the Management except to use these assets. Hence the useful life for Plant & Machinery of 10 years and Moulds of 6 years for continuous running is different from the useful life as prescribed under Part C of Schedule II of Companies Act, 2013. Consequently based on the technical evaluation the Company has reassessed the useful life of its Fixed Assets.

(b) Cost of Leasehold Land is amortized over the period of lease;

(c) Assets like mobile phones, telephone instruments, etc are fully depreciated in the year of purchase/ acquisition.

e. Inventories :

Item of inventories are valued at lower of cost & net realizable value after providing for obsolescence, if any.

(a) Raw Material - The cost of Raw Material is arrived at after reducing the available cenvat, education cess, secondary education cess and value added tax and the Raw Materials are valued at cost.

(b) Finished goods - Finished Goods are valued at the cost or Net realizable value, whichever is lower.

(c) Packing Material and stores, spares & consumable are valued at cost.

f. Revenue Recognition :

Revenue is accounted on accrual basis unless otherwise stated.

Other Income such as Dividend Income is recognized when Company''s right to receive the Dividend is established by the reporting date, Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. The Income from Services are recognized on accrual basis.

g. Leases

Operating Leases where the less or effectively retains substantially all the risks and benefits of ownership of the leased terms, are classified as operating lease. Operating Lease payments are recognized as an expense in the Profit and Loss Account on a straight line basis over the lease term. Leasehold Lands are depreciated according to the Lease Period.

h. Sales :

Gross Sales are inclusive of Duties and Taxes. The Sales are recognized when the significant rights and reward of the ownership of the goods pass to the buyer which is generally when the goods are loaded into Party''s vehicle for final dispatch. Sales are net of rebates, rate difference, trade discounts, claims & shortages.

I. Excise Duty

Excise Duty is accounted on the basis of both, payment made in respect of goods cleared and provisions are made for goods lying in Stock.

j. Foreign Currency Transactions :

(a) Foreign Currency transactions are initially recorded at the rates of exchange prevailing on the date of transactions.

(b) Non Monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

k. Employee Retirement Benefits :

(a) Short term employee benefits are recognized as an expenses at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

(b) Post employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined by using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to Profit and Loss account.

l. Taxation :

Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax Act, 1961. Deferred tax Asset / liability is calculated by applying the applicable tax rate as at balance sheet date. Deferred tax adjustments on account of timing difference are recognized only to the extent there is reasonable certainty of realization. At each balance sheet date, carrying amounts of deferred tax assets / liability is reviewed and necessary adjustment are made in asset / liability.

m. Borrowing Cost :

Borrowing Cost directly attributable to the acquisition & construction of an asset, which take a substantial period of time to get ready for its intended use are capitalized as part of the cost of such asset, until such time assets is substantially ready for its intended use. All other borrowing costs are recognized in the Profit and Loss Accounts in the period in which they are incurred.

n. Impairment of Assets:

The impairment loss is recognized whenever carrying amount of asset are exceeds its estimated recoverable amount. It is reviewed at each balance sheet date. An impairment loss is further provided or reversed depending upon the changes in circumstances.

o. Warranty:

Provision is estimated for expected warranty claim in respect of products sold during the year based on past experience regarding defective claim of products and cost of rectification or replacement. It is expected that most of these cost will be incurred over next 12 months which are as per warranty terms.

p. Provisions, Contingent Liabilities and Contingent Assets :

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.

q. Current / Non Current Items :

All Assets and Liabilities are presented as Current or Non Current as per the Company''s normal operating cycle and the other criteria set out in Schedule - III to the Companies Act, 2013.


Mar 31, 2015

A. Basis of Preparation of Financial Statement

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The Financial Statements of the Company are prepared in accordance with the Section 129 of Companies Act, 2013 and accounting principles generally accepted, the Accounting Standards specified under Section 133 of the Companies Act, 2013 and Rule 7 of the Companies (Accounts) Rules, 2014.

b. Use of Estimates

Accounting estimate could change from period to period and actual result could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

c. Fixed Assets :

Fixed assets (other than "Freehold land" where no depreciation is charged) are stated at cost less accumulated depreciation. Cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition for the intended use. Cenvat Receivable and Value added tax, if any on plant & machinery and moulds have been reduced from the cost of acquisition of the said assets. The amount of Capital Work in Progress is valued at Cost.

d. Depreciation :

Depreciation on Fixed Assets is provided on life assigned to each assets in accordance with the Schedule - II of the Companies Act, 2013. Consequently based on the technical evaluation the Company has reassessed the useful life of its Fixed Assets. Consequent to the reduction in the useful life of Fixed Assets based on transitional provisions given in Schedule II RS. 449.45 (Net of Deferred Tax input of RS. 165.58 lacs) has been adjusted against opening balance in General Reserves.

e. Inventories :

Item of inventories are valued at lower of cost & net realizable value after providing for obsolescence, if any.

1. Raw Material - The cost of Raw Material is arrived at after reducing the available cenvat, education cess, secondary education cess and value added tax and the Raw Materials are valued at cost.

2. Finished goods - Finished Goods are valued at the cost or Net realizable value, whichever is lower.

3. Packing Material and stores, spares & consumable are valued at cost.

f. Revenue Recognition :

Revenue is accounted on accrual basis unless otherwise stated.

Other Income such as Dividend Income is recognized when Company''s right to receive the Dividend is established by the reporting date, Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. The Income from Services are recognized on accrual basis.

g. Leases

Operating Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased terms, are classified as operating lease. Operating Lease payments are recognized as an expense in the Profit and Loss Account on a straight line basis over the lease term. Leasehold Lands are depreciated according to the Lease Period.

h. Sales :

Gross Sales are inclusive of Duties and Taxes. The Sales are recognized when the significant rights and reward of the ownership of the goods pass to the buyer which is generally when the goods are loaded into Party''s vehicle for final dispatch. Sales are net of rebates, rate difference, trade discounts, claims & shortages.

I. Excise Duty

Excise Duty is accounted on the basis of both, payment made in respect of goods cleared and provisions are made for goods lying in Stock.

j. Foreign Currency Transactions :

a. Foreign Currency transactions are initially recorded at the rates of exchange prevailing on the date of transactions.

b. Non Monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

k. Employee Retirement Benefits :

a) Short term employee benefits are recognized as an expenses at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b) Post employment and other long term employee benefits are recognized as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined by using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to Profit and Loss account.

l. Taxation :

Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax Act, 1961. Deferred tax Asset / liability is calculated by applying the applicable tax rate as at balance sheet date. Deferred tax adjustments on account of timing difference are recognized only to the extent there is reasonable certainty of realization. At each balance sheet date, carrying amounts of deferred tax assets / liability is reviewed and necessary adjustment are made in asset / liability.

m. Borrowing Cost :

Borrowing Cost directly attributable to the acquisition & construction of an asset, which take a substantial period of time to get ready for its intended use are capitalized as part of the cost of such asset, until such time assets is substantially ready for its intended use. All other borrowing costs are recognized in the Profit and Loss Accounts in the period in which they are incurred.

n. Impairment of Assets:

The impairment loss is recognized whenever carrying amount of asset are exceeds its estimated recoverable amount. It is reviewed at each balance sheet date. An impairment loss is further provided or reversed depending upon the changes in circumstances.

o. Provisions, Contingent Liabilities and Contingent Assets :

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.

p. Current / Non Current Items :

All Assets and Liabilities are presented as Current or Non Current as per the Company''s normal operating cycle and the other criteria set out in Schedule - III to the Companies Act, 2013.


Mar 31, 2014

NIL


Mar 31, 2013

(i) Basis of Preparation of Financial Statement

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The financial statement are prepared to comply in all material respect with the Accounting Standards notified in the Companies (Accounting standards) Rules, 2006 and provision of Companies Act, 1956.

(ii). Use of Estimates

Accounting estimates could change from period to period and actual result could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

(iii). Fixed Assets :

Fixed assets (other than "Freehold land" on which no depreciation is charged) are stated at cost less accumulated depreciation. Cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition for the intended use. Cenvat receivable and Value added tax , if any, on plant & machinery and moulds are reduced from the cost of acquisition of the said assets. The amount of Capital Work in Progress is valued at Cost.

(iv). Depreciation :

Depreciation on Fixed Assets is provided on "Straight Line Method" at rates prescribed in schedule XIV to the Companies Act, 1956 on pro- rata basis.

Assets like mobile phones, telephone instruments etc are fully written off in the year of purchase.

(v). Inventories :

Item of inventories are valued at lower of cost & net realizable value after providing for obsolescence , if any. Inventory Cost is determined in First in First Out basis.

(a) Raw Material - The cost of Raw Material is arrived at after reducing the available cenvat, education cess, secondary education cess and value added tax .

(b) Finished goods - At cost or net realizable value, whichever is lower. The valuation of closing stock of finished goods made in accordance with Accounting Standards and includes the value of excise duty payable on Finished Goods and it is charged to the Profit and Loss Account. Trading stock is maintained at net of value added tax.

(c) Packing Material and stores, spares & consumables are valued at Cost.

(vi). Revenue Recognition :

Revenue is accounted on accrual basis unless otherwise stated. Sale of products are recognized when the products are dispatched and sales are net of returns , rate differences, trade discount etc.

Other Income such as Dividend income is recognized when Company''s right to receive the Dividend is established by the reporting date, Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. The Income from services are recognized on accrual basis.

(vii). Leases:

Operating Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased terms, are classified as operating lease. Operating Lease payments are recognized as an expense in the statement of profit & loss on a straight line basis over the Lease Term. Leasehold Lands are depreciated according to the Lease Period.

(viii). Sales :

Sales are recognized when the significant rights and reward of the ownership of the goods pass to the buyer. Sales are net of rebates, trade discounts, claims & shortages.

(ix). Foreign Currency Transactions :

a. Foreign Currency transactions are initially recorded at the rates of exchange prevailing on the date of transactions.

b. Non Monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transactions.

(x). Employee Retirement Benefits :

(a) Short-term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss Statement of the year in which the related service is rendered.

(b) Post employment and other long term employee benefits are recognised as an expense in the Profit and Loss Statement for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

(xi). Taxation :

Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax, 1961. Deferred tax Asset / liability is calculated by applying the applicable tax rate as at balance sheet date. Deferred tax adjustments on account of timing difference are recognized only to the extent there is reasonable certainty of realization. At each balance sheet date, carrying amounts of deferred tax asset / liability is reviewed and necessary adjustments are made in asset / liability.

(xii). Borrowing Cost :

Borrowing Cost directly attributable to the acquisition & construction of an asset which take a substantial period of time to get ready for its intended use, are capitalized as a part of the cost of such assets, until such time the asses is substantially ready for its intended use. All other borrowing costs are recognized in the statement of profit & loss in the period they occur.

(xiii). Impairment of Assets:

The impairment loss is recognized whenever the carrying amount of assets exceeds its estimated recoverable amount and it is reviewed at each Balance Sheet date. An impairment loss is further provided or reversed depending upon the changes in circumstances.

(xiv). Provisions, Contingent Liabilities and Contingent Assets :

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.

(xv). Crrent / Non Current Items:

All Assets and Liabilities are presented as Current or Non Current as per the Company''s normal operating cycle and the other criteria set out in revised Schedule VI to the Companies Act, 1956. The Company has ascertained its operating cycle as 12 months for the purpose of Current and Non Current Classification of Assets and Liabilities.


Mar 31, 2012

1. Basis of Preparation of Financial Statement:

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements is in conformity with generally accepted accounting principles which require management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The financial statement are prepared to comply in all material respect with the accounting standard notified by the Companies (Accounting standards) Rules, 2006 and provision of companies Act, 1956.

2. Use of Estimates:

Accounting estimate could change from period to period and actual result could defer from those estimates. Appropriate changes in estimates are made as the Management become aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

3. Fixed Assets:

Fixed assets (other than "Freehold land" where No depreciation is charged) are stated at cost less accumulated depreciation. Cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition for the intendeduse. Cenvat receivable and Value added tax , if any on plant & machinery and moulds have been reduced from the cost of acquisition of the said assets. The amount of Capital Work in Progress is valued at Cost.

4. Depreciation:

Depreciation on Fixed Assets is provided on "Straight Line Method" at ratesprescribed in schedule XIV to the Companies Act, 1956. Assets like mobile phones, telephone instruments etc are fully written off in the year of its purchase.

5. Inventories:

Item of inventories are measured at lower of cost & net realizable value after providing for obsolence, if any. 'First in First out' FIFO is the formula used for determination of Inventory Cost.

(a) Raw Material -The cost of Raw Material is arrived at after reducing the available cenvat, education cess, secondary education cessand value added tax .

(b) Finished goods - At cost or net realizable value, whichever is lower. The valuation of closing stock of finished goods is in accordance with AS-2 and includes the excise duty payable & the excise duty element has been charged to the Profit and Loss Account. Trading stock is maintained at net of value added tax.

(c) Packing Material and stores, spares & consumable - At cost or net realizable value , whichever is lower.

6. Revenue Recognition:

Revenue is accounted on accrual basis unless otherwise stated. Sale of products are recognized when the products are dispatched and sales are net of returns , rate differences, trade discount etc.

Other Income such as Dividend, Interest and Income from Services are recognized on accrual basis.

7. Leases:

Leases where the lessor effectively retains substantially all the risk and benefit of ownership of the lease term are classified as operating lease. Lease rent under operating leases are reconignised in the profit and loss account on a straight-line basis. The cost of lease hold land is amortised over the period of lease.

8. Sales:

Sales are net of rebates, trade discounts, claims & shortages.

9. Foreign Currency Transactions:

Transaction denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximate the actual rate at the date of transaction.

Non Monetary foreign currency items are carried at cost.

10. Employee Retirement Benefit:

a) Post -employment benefit plans

1) Defined contribution plan

Contribution to Provident fund, Employee State Insurance Corporation and Superannuation fund are recognized as expense when employees have rendered services entitling them to contribution.

2) Defined benefit plan

Defined benefit Plans are determined by using the project unit credit method with actuarial valuation being carried out at the Balance Sheet date. Actuarial gains & losses are recognized in full in the profit & loss accounts for the period in which -—— they accrue. -n-a

b) Short term employment benefits

Short term employee benefits are recognised as an expenses at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

11. Taxation:

Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax, 1961. Deferred tax Asset / liability is calculated by applying the applicable tax rate as at Balance Sheet date. Deferred tax adjustment on account of timming difference are recognized only to the extent there is reasonable certainty of realization. At each balance sheet date, carrying amount of deferred tax assets / liability is reviewed and necessary adjustment to asset / liability is made.

12. Borrowing Cost:

Borrowing Cost attributable to the acquisition of qualifying fixed assets is capitalized as part of the cost of such assets till such assets are put to use. All other borrowing costs are charged to Profit and Loss account.

13. Impairment of Assets:

The carrying amounts of assets are reviewed at balance sheet date. If there is any indication of impairment based on internal & external factors i.e. when the carrying amount of assets exceeds the recoverable amount, an impairment loss is charged to the profit & Loss account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting period is reversed or reduced if there has been a favourable change in the estimate of the recoverable amount.

14. Provisions, Contingent Liabilities and Contingent Assets:

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.


Mar 31, 2011

1. Basis of Preparation of Financial Statement

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements in conformity with generally accepted accounting principles require management to make estimates and assumption that affect the reported amount of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The financial statement are prepared to comply in all material respect with the accounting standard notified by the Companies (Accounting standards) Rules, 2006 and provision of companies Act, 1956.

2. Use of Estimates

Accounting estimate could change from period to period and actual result could defer from those estimates. Appropriate changes in estimates are made as the Management become aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

3. Fixed Assets :

Fixed assets (other than “Freehold land” where No depreciation is charged) are state at cost less accumulated depreciation , cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition for the intended to use. Cenvat receivable , if any on plant & machinery and moulds has been reduced from the cost of acquisition of the said assets. The amount of Capital Work in Progress is valued at Cost.

4. Depreciation :

Depreciation on Fixed Assets is provided on “Straight Line Method” at rates prescribed in schedule XIV to the Companies Act, 1956. Assets like mobile phones, telephone instruments etc are fully written off in the year of its purchase.

5. Inventories :

(a) Raw Material - At cost or market value, whichever is lower. The cost of Raw Material is arrived at after reducing the available cenvat, education cess, secondary education cess and value added tax .

(b) Finished goods - At cost or net realizable value, whichever is lower. The valuation of closing stock of finished goods is in accordance with AS- 2 and includes the excise duty payable &. the excise duty element has been charged to the Profit and Loss Account. Trading stock is maintained at net of value added tax.

(c) Packing Material and stores, spares &. consumable - At cost or market value, whichever is lower. ‘First in First out’ FIFO is the formula used for determination of Inventory Cost.

6. Investments :

Long-term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

Short-term Investment is in mutual fund are stated at the the Net Asset Value of the Funds. During the FY. 2010-11 units worth Rs 38,01,54,092/- (P.Y. Rs 13,57,89,078/-) were purchased and units worth Rs 39,79,87,790/- (P.Y. Rs 14,84,00,000/-) were sold.

7. Revenue Recognition :

Revenue is accounted for an accrual basis unless otherwise stated. Sale of products are recognized when the product are dispatched and sales are net of returns , rate difference, trade discount etc.

Other Income such as Dividend, Interest and Income from Services are recognized on accrual basis.

8. Leases

Leases where the lessor effectively retains substantially all the risk and benefit of ownership of the lease term are classified as operating lease. Lease rent under operating leases are recognised in the profit and loss account on a straight-line basis.

9. Sales :

Sales are net of rebates, trade discount, claims & shortages.

10. Foreign Currency Transactions :

a. Foreign Currency loans / liabilities are stated in the accounts at the end of the year based on the prevailing exchange rates.

b. Foreign Exchange differences and charges on forward contracts are adjusted to profit and loss account.

11. Employee Retirement Benefit :

a) Post -employment benefit plans

1) Defined contribution plan

Contribution to Provident fund, Employee State Insurance Corporation and Superannuation fund are recognized as expense when employees have rendered services entitling them to contribution.

2) Defined benefit Plan

Defined benefit Plans are determined by using the project unit credit method with actuarial valuation being carried out at the balance sheet date.

Actuarial gains & losses are recognized in full in the profit &. loss accounts for the period in which they accrue.

b) Short term employment benefits

The undisclosed amount of short term employee benefit expected to be paid in exchange for the services rendered by the employee is recognized during the period when the employee renders the services. These benefits include compensated absences such as leave salary and performance incentives.

12. Taxation :

a) Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax, 1961.

b) Deferred tax Asset / liability is calculated by applying the applicable tax rate as at balance sheet date. Deferred tax adjustment on account of timming difference are recognized only to the extent there is reasonable certainty of realization. At each balance sheet date, carrying amount of deferred tax assets / liability is reviewed and necessary adjustment to asset / liability is made.

13. Borrowing Cost :

Borrowing Cost attributable to the acquisition of qualifying fixed assets is capitalized as part of the cost of such assets till such assets are put to use. All other borrowing costs are charged to Profit and Loss account.

14. Impairment of Assets:

The carrying amounts of assets are reviewed at balance sheet date. If there is any indication of impairment based on internal & external factors i.e. when the carrying amount of assets exceeds the recoverable amount, an impairment loss is charged to the profit & Loss account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting period is reversed or reduced if there has been a favourable change in the estimate of the recoverable amount.

15. Provisions, Contingent Liabilities and Contingent Assets :

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.

Forming part of the accounts for the financial year 2010-11


Mar 31, 2010

1. Basis of Preparation of Financial Statement:

(a) The Accounts are prepared on Historical cost convention on an accrual basis.

(b) The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure regarding contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provision for doubtful debts and advances, obligation under employees retirement benefits and Income Tax.

(c) The financial statement are prepared to comply in all material respect with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 and provision of companies Act, 1956.

2. Use of Estimates:

Accounting estimate could change from period to period and actual results may defer from those estimates. Appropriate changes in estimates are made as the management becomes aware of changes in the circumstances. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

3. Fixed Assets:

Fixed assets (other than “Freehold land” where No depreciation is charged) are state at cost less accumulated depreciation, cost of acquisition is inclusive of purchase price and any directly attributable cost of bringing the assets to working condition. Cenvat receivable, if any on plant & machinery and moulds has been reduced from the cost of acquisition of the assets

4. Depreciation:

Depreciation on Fixed Assets is provided on “Straight Line Method” at rates prescribed in schedule XIV to the Companies Act, 1956.

5. Inventories:

Raw Materials - At cost or market value, whichever is lower. The cost of Raw Materials are arrived at after reducing the cenvat, education cess, secondary education cess and value added tax, availed on it.

Finished goods - At cost or net realizable value, whichever is lower. The valuation of closing stock of finished goods is in accordance with

AS-2 and includes the excise duty payable & the excise duty element has been charged to the Profit and Loss Account. Trading stock is maintained at net of value added tax.

Packing Materials, stores, spares and consumable are stated at cost or market value, whichever is lower.

6. Investments:

Long - term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such diminution is permanent in nature.

Short-term Investments are made in SBI Liquid Fund and are stated at Net Asset Value. During the year units worth Rs.13,57,89,078/- (Previous year Rs. 5,76,92,664/-) were purchased and units worth Rs.14,84,00,000/- (Previous Year Rs. 2,75,00,000/-) were sold.

7. Revenue Recognition:

Revenue is accounted for an accrual basis unless otherwise stated. Sale of products are recognized when the product are dispatched and sales are net of returns & discounts.

8. Lease:

Leases where the lessor effectively retains substantially all the risk and benefit of ownership of the lease term are classified as operating lease. Lease rent under operating leases are reconignised in the profit and loss account on a straight-line basis.

9. Foreign Currency Transactions :

Foreign Currency loans / liabilities are stated in the accounts at the end of the year based on the prevailing exchange rates. Foreign Exchange differences and charges on forward contracts are adjusted to profit and loss account.

10. Employee Benefits:

a) Post -employment benefit plans

1) Defined contribution plan

Contribution to Provident fund, Employee State Insurance Corporation and Superannuation fund are recognized as expense when employees have rendered services.

2) Defined benefit Plan

Defined benefit Plans are determined by using the project unit credit method with actuarial valuation being carried out at the balance sheet date.

Actuarial gains / losses are recognized in full in the profit & loss accounts for the period in which they accrue.

b) Short term employment benefits

The undisclosed amount of short term employee benefits are expected to be paid in exchange for the services rendered by the employee is recognized during the period when the employee renders the services. These benefits include compensated absences such as leave salary and performance incentives.

11. Taxation:

Provision for current tax is made in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax, 1961.

Deferred tax Asset / liability is calculated by applying the applicable tax rate as at balance sheet date. Deferred tax adjustments on account of timing difference are recognized only to the extent there is reasonable certainty of realization. At the Balance Sheet date, carrying amount of deferred tax assets / liability is reviewed and necessary adjustments to assets / liabilities are made.

12. Borrowing Costs:

Borrowing Costs are attributable to the acquisition of qualifying fixed assets are capitalized as part of the cost of such assets till such assets are put to use. All other borrowing costs are charged to Profit and Loss account. There was no Borrowing During the year.

13. Impairment of Assets:

The carrying amounts of assets are reviewed at balance sheet date. If there is any indication of impairment based on internal / external factors, i.e. when the carrying amount of assets exceeds the recoverable amount, an impairment loss is charged to the profit & Loss account in the year in which the asset is identified as impaired. An impairment loss recognized in prior accounting period is reversed or reduced if there has been a favorable change in the estimate of the recoverable amount. There was no impairment of assets during the year.

14. Provisions, Contingent Liabilities and Contingent Assets:

A provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material, are disclosed by way of notes to accounts. Contingent Assets are not recognized or disclosed in the financial statements.

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