Mar 31, 2014
Basis of Accounts
The accounts have been prepared according to historical cost
convention, adjusted by revaluation of fixed assets and governing
statutes in India.
Use of Estimates
The preparation of financial statement require management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and disclosures relating to contingent liabilities and
assets as at the Balance Sheet date and the reported amounts of income
and expenses during the year.
Provision for contingencies are recorded when it is probable that a
liability will be incurred and the amounts can reasonably be estimated.
Differences between the actual results and estimates are recognized in
the year in which the results are known / materialized.
Sales
Sales are accounted for on passing of title to the customers. Returns
and rebates and discounts against goods sold are recognized as and when
ascertained and deducted from sales. Sales include excise duty.
Export Benefits
Export benefits arising on account of entitlement for duty free imports
are accounted for at the time of receipt of material. Other export
benefits are accounted for as and when accrued.
Fixed Assets
Fixed Assets are stated at cost of acquisition / construction (net of
CENVAT/VAT and other credits) or at revalued amount as the case may be
and inclusive of incidental expenses, erection / commissioning
expenses, revamping expenses, pre- operative expenses, interest, etc.
upto the date the asset is put to use.
Depreciation / Amortization
a) The classification of Plant & Machinery into continuous and
non-continuous is carried as per technical certification and
depreciation thereon, is provided accordingly, on straight-line method
at the rates prescribed in schedule XIV of the Companies Act, 1956.
b) Additional depreciation attributable to the increase in the value of
assets on account of revaluation is transferred from Revaluation
Reserve to the Profit and Loss account.
c) Computer software, Intangible assets are amortised over the period
of six years.
Impairment
Fixed assets are reviewed at each balance sheet date for impairment. In
case events and circumstances indicate any impairment, recoverable
amount of fixed assets is determined. An impairment loss is recognized,
whenever the carrying amount of assets either belonging to Cash
Generating Unit (CGU) or otherwise exceeds recoverable amount. The
recoverable amount is the greater of assets net selling price or its
value in use. In assessing value in use, the estimated future cash flow
from the use of the assets is discounted to their present value at
appropriate rate. An impairment loss is reversed if there has been a
change in the recoverable amount and such loss either no longer exists
or has decreased. Impairment loss/reversal thereof, which in case of
CGU, are allocated to its assets on a pro rata basis, is adjusted to
carrying value of its respective assets.
Investments
Long Term Investments are valued "at cost" except where there is a
diminution in value, other than temporary, in which case, adequate
provision is made against such shortfall.
Inventory
Inventories are valued at lower of cost or estimated net realizable
value. Cost of inventories has been computed on weighted average basis.
In case of work in progress and finished goods cost represents
materials, direct labour and appropriate portion of factory overheads.
Adequate provision for defective, slow/non moving, obsolete stocks are
made on the basis of technical evaluation
Transactions in Foreign Currency
Transaction in foreign currency is accounted for at the exchange rate
prevailing on the date of the transaction. Foreign currency monetary
assets and liabilities at the year-end are translated using the closing
exchange rates whereas non- monetary assets are translated at the rate
on the date of the transaction. The gain and loss thereon and also on
the exchange differences on settlement of the foreign currency
transactions during the year are recognized as income or expense and
are adjusted to the profit and loss account.
Employee Benefits
Employee benefits are accrued in the year in which the employees have
rendered services. Contribution to defined contribution schemes such as
Provident Fund, Superannuation Fund etc. are recognized as and when
incurred.
Long-term employee benefits under defined benefit scheme such as
gratuity, leave etc. are determined at the end of the year at present
value of the amount payable using actuarial valuation techniques.
Actuarial gain and losses are recognized in the year when they arise.
Research and development expenditure
Research and development expenditure of revenue nature are charged to
the profit & loss account, while capital expenditures are added to
fixed assets in the year in which they are incurred
Contingencies
Liabilities which are material and whose future outcome cannot be
ascertained with reasonable certainty are treated as contingent and
disclosed by way of Notes to the Accounts.
Borrowing costs
Borrowing costs incurred in relation to the acquisition, construction
of assets are capitalized as part of the costs of such assets upto the
date when such assets are ready for intended use. Other borrowing costs
are charged as an expense in the year in which these are incurred.
Taxes on Income
Provision for Current Income Tax is made on the taxable income using
the applicable tax rates and tax laws. Deferred tax arising on account
of timing differences and which are capable of reversal in one or more
subsequent periods is recognized using the tax rates and tax laws that
have been enacted or substantively enacted. Deferred tax assets are
recognized only to the extent that there is reasonable certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized. In situation where the company has
unabsorbed depreciation or carry forward tax losses, all deferred tax
assets are recognized only if there is virtual certainty supported by
convincing evidence that they can be realized against future taxable
profits.
Warranties
Warranty costs are accrued in the year of sale, based on past
experience.
Sep 30, 2010
Basis of Accounts
The accounts have been prepared according to historical cost
convention, adjusted by revaluation of fixed assets. All expenses and
income to the extent considered payable and receivable, unless stated
otherwise, have been accounted for on accrual basis.
Use of Estimates
The preparation of financial statement require management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and disclosures relating to contingent liabilities and
assets as at the Balance Sheet date and the reported amounts of income
and expenses during the year.
Provision for contingencies are recorded when it is probable that a
liability will be incurred and the amounts can reasonably be estimated.
Differences between the actual results and estimates are recognized in
the year in which the results are known / materialised.
Sales
Sales are accounted for on passing of title to the customers. Returns
and rebates and discounts against goods sold are recognised as and when
ascertained and deducted from sales. Sales includes excise duty.
Export Benefits
Export benefits arising on account of entitlement for duty free imports
are accounted for at the time of receipt of material. Other export
benefits are accounted for as and when accrued.
Fixed Assets
Fixed Assets are stated at cost of acquisition / construction (net of
CENVAT/VAT and other credits) or at revalued amount as the case may be
and inclusive of incidental expenses, erection / commissioning
expenses, revamping expenses, pre-operative expenses, interest, etc.
upto the date the asset is put to use.
Depreciation / Amortisation
a) The classification of Plant & Machinery into continuous and
non-continuous is carried as per technical certification and
depreciation thereon, is provided accordingly, on straight-line method
at the rates prescribed in schedule XIV of the Companies Act, 1956.
b) Additional depreciation attributable to the increase in the value of
assets on account of revaluation is transferred from Revaluation
Reserve to the Profit and Loss account.
c) Computer software, Intangible assets are amortised over the period
of six years.
Impairment
Fixed assets are reviewed at each balance sheet date for impairment. In
case events and circumstances indicate any impairment, recoverable
amount of fixed assets is determined. An impairment loss is recognized,
whenever the carrying amount of assets either belonging to Cash
Generating Unit (CGU) or otherwise exceeds recoverable amount. The
recoverable amount is the greater of assets net selling price or its
value in use. In assessing value in use, the estimated future cash flow
from the use of the assets is discounted to their present value at
appropriate rate. An impairment loss is reversed if there has been a
change in the recoverable amount and such loss either no longer exists
or has decreased. Impairment loss/reversal thereof, which in case of
CGU, are allocated to its assets on a pro rata basis, is adjusted to
carrying value of its respective assets.
Investments
Long Term Investments are valued Ãat costà except where there is a
diminution in value, other than temporary, in which case, adequate
provision is made against such shortfall.
Inventory
Inventories are valued at lower of cost or estimated net realisable
value. Cost of inventories has been computed on weighted average basis.
In case of work in progress and finished goods cost represents
materials, direct labour and appropriate portion of factory overheads.
Adequate provision for defective, slow/non moving, obsolete stocks are
made on the basis of technical evaluation.
Transactions in Foreign Currency
Transaction in foreign currency is accounted for at the exchange rate
prevailing on the date of the transaction. Foreign currency monetary
assets and liabilities at the year-end are translated using the closing
exchange rates whereas non-monetary assets are translated at the rate
on the date of the transaction. The gain and loss thereon and also on
the exchange differences on settlement of the foreign currency
transactions during the year are recognised as income or expense and
are adjusted to the profit and loss account.
Employee Benefits
Employee benefits are accrued in the year in which the employees have
rendered services.
Contribution to defined contribution schemes such as Provident Fund,
Superannuation Fund etc. are recognized as and when incurred.
Long-term employee benefits under defined benefit scheme such as
gratuity, leave etc. are determined at the end of the year at present
value of the amount payable using actuarial valuation techniques.
Actuarial gain and losses are recognized in the year when they arise.
Research and development expenditure
Research and development expenditure of revenue nature are charged to
the profit & loss account, while capital expenditures are added to
fixed assets in the year in which they are incurred.
Contingencies
Liabilities which are material and whose future outcome cannot be
ascertained with reasonable certainty are treated as contingent and
disclosed by way of Notes to the Accounts.
Borrowing costs
Borrowing costs incurred in relation to the acquisition, construction
of assets are capitalised as part of the costs of such assets upto the
date when such assets are ready for intended use. Other borrowing costs
are charged as an expense in the year in which these are incurred.
Taxes on Income
Provision for Current Income Tax is made on the taxable income using
the applicable tax rates and tax laws. Deferred tax arising on account
of timing differences and which are capable of reversal in one or more
subsequent periods, is recognised using the tax rates and tax laws that
have been enacted or substantively enacted. Deferred tax assets are
recognised only to the extent that there is reasonable certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized. In situation where the company has
unabsorbed depreciation or carry forward tax losses, all deferred tax
assets are recognised only if there is virtual certainty supported by
convincing evidence that they can be realized against future taxable
profits.
Warranties
Warranty costs are accrued in the year of sale, based on past
experience.
Miscellaneous Expenditure
Expenses incurred under voluntary retirement scheme are amortized over
a period of five years unless required to be amortized over a shorter
period by the relevant accounting standard.