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Accounting Policies of Flex Foods Ltd. Company

Mar 31, 2017

I COMPANY OVERVIEW

Flex Foods Ltd. is a public limited company and incorporated on 5th February, 1990 with the Registrar of Companies, having Corporate Identification Number (CIN) L15133UR1990PLC023970. The Registered Office of the Company is situated at Lal Tappar Industrial Area, P. O. Resham Majri, Haridwar Road, Dehradun (Uttarakhand) and Corporate office at A-107-108, Sector-4, Noida, Uttar Pradesh-201301.

Flex Foods Ltd. is engaged mainly in the business of cultivation and processing of Mushrooms, Herbs, Fruits & Vegetables in Freeze Dried, Air Dried and Individually Quick Frozen form. Flex Foods Ltd. has been selling its products mainly to the European and US markets.

II SIGNIFICANT ACCOUNTING POLICIES

A. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Company has adopted Indian Accounting Standards (Ind AS) notified by the Ministry of Corporate Affairs under the Companies (Accounting Standards) Rules 2015 and Companies (Accounting Standards) Rules 2016 with effect from 1st April 2016. The adoption of the IND AS was carried out in accordance with the IND AS 101 First Time adoption of Indian Accounting Standards. Please refer to Note No. 2 for more information on reconciliations of differences and descriptions of the effect of transition.

The transition of Ind AS as resulted in changes in the presentation of the Financial Statements, disclosures in the notes thereto and accounting policies and principles. The accounting policies set out in Note 1 have been applied in preparing the standalone financial statements for the year ended March 31, 2017 and the comparative information. Accordingly the Financial Statements of the Company with effect from 1st April 2016 have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under the Companies (Accounting Standards) Rules 2015 and Companies (Accounting Standards) Rules 2016, the provisions of Companies Act, 2013, and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. Financial Statements of the Company are prepared under the historical cost convention on the accrual basis except for the following assets and liabilities which have been measured at their fair value.

- Certain financial assets and liabilities measured at fair value (refer relevant accounting policies for more details). The financial statements are presented in Indian Rupees (INR). Amount has been rounded off to nearest thousands. For the periods up to and including the financial year ended 31st March 2016; the financial Statements were prepared in accordance with the Indian Generally Accepted Accounting Principles (IGAAP) under the historical cost convention on the accrual basis. IGAAP comprises mandatory accounting standards as prescribed by the Companies Act 2013 u/s 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of Companies Act, 2013, and guidelines issued by the Securities and Exchange Board of India (SEBI), Accounting Policies have been consistently applied.

B. USE OF ESTIMATES AND JUDGEMENTS

The preparation of the financial statements is in conformity with Ind AS requires management to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates.

The estimates and underlying assumptions are reviewed on a going concern basis.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, in the period of the revision and future periods if the revision affects both current and future period.

C. CLASSIFICATION OF EXPENDITURE/INCOME Except Otherwise Indicated:-

(i) All expenditure and income are accounted for under the natural heads of account.

(ii) All expenditure and income are accounted for on accrual basis except when ultimate realization of income is uncertain.

D. REVENUES

(i) Revenues from sales of goods are recognized when the significant risk and rewards of the ownership of the goods have been transferred to the buyer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing effective control over, or managerial involvement with, the goods and the amount of revenue can be measured reliably. The timing of transfers of risks and rewards normally happen upon shipment.

(ii) Sales returns / rate differences are adjusted from the sales of the year in which the returns take place / rate differences accepted.

(iii) Sales are adjusted for Rebate & Discount allowed and commission paid.

(iv) Interest income is recognized on time apportionment basis. Effective interest method is used to compute the interest income on long terms loans and advances.

(v) Further, revenues are recognized at gross value of consideration received including the amount of excise duty/ cess recoveries and excluding sales tax/ value added tax.

E. PROPERTY, PLANT AND EQUIPMENT (PPE)

Recognition and measurement:

Property, plant and equipment are initially recognized at cost after deducting refundable purchase taxes and including the cost directly attributable for bringing the asset to the location and conditions necessary for it to be capable of operating in the manner intended by the management, borrowing cost in accordance with the established accounting policy, cost of restoring and dismantling, if any, initially estimated by the management. After the initial recognition the property, plant and equipment are carried at cost less accumulated depreciation and impairment losses.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit or loss.

The estimated useful lives, residual values and depreciation method are reviewed at each financial year end and the effect of any change is accounted for on prospective basis.

The carrying amount of the all property, Plant and equipment are derecognized on its disposal or when no future economic benefits are expected from its use or disposal and the gain or loss on de-recognition is recognized in the statement of profit & loss.

The Company has opted for an exemption provided by the Indian Accounting Standard (Ind As)-101. Accordingly the carrying value for all Property, plant and Equipment and Intangibles as recognized in the financial statements, as at the date of transition to Ind AS, measured as per previous IGAAP are used as deemed cost as at the date of transition.

F. INTANGIBLE ASSETS

(i) Customized or separately purchased software is classified as intangible assets at their cost and amortized over a period of five years from date of put to use.

(ii) All revenue expenditure on research & development activities are accounted for under their natural heads of revenue expenses accounts.

(iii) Intangible asset is derecognized on disposal or when no future economic benefits are expected from continuing use or disposal.

(iv) The estimated useful lives, residual values and amortization method are reviewed at each financial year end and the effect of any change is accounted for on prospective basis.

G. INVESTMENT PROPERTIES

(i) Investment properties are initially recognized at cost after deducting refundable purchase taxes and including the transaction cost, if any. After initial recognition the investment property are carried at cost less accumulated depreciation and impairment losses.

(ii) Transfer to and from the investment properties are made when and only when, there is change in the use of the investment property as evidenced by the conditions laid down under the Indian Accounting Standard. The carrying amount of the property as on the date of classification is considered as carrying value of the investment property and vice-versa.

(iii) Depreciation on investment properties are provided for from the date of put to use for on straight line method at the useful lives prescribed in Schedule-II to the Companies Act, 2013.

(iv) The carrying amount of the investment properties are derecognized on its disposal or when no future economic benefits are expected from its use or disposal and the gain or loss on de-recognition is recognized in the statement of profit & loss.

(v) The estimated useful lives, residual values and depreciation method are reviewed at each financial year end and the effect of any change is accounted for on prospective basis.

H. INVENTORIES

(i) Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived at after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value except in case of agricultural produce harvested from an entity’s biological assets are measured at its fair value less costs to sell at the point of harvest.

ii Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived at after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building , specific Manufacturing expenses and specific Payments and Benefits to Employees or net realizable value.

iii Raw Materials & other materials including packing materials, imported spares, stores fuel and consumables are valued at lower of cost, based on first-in-first-out (FIFO) method arrived at after including freight inward and other expenditure directly attributable to acquisition or net realizable value.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

I. FINANCIAL INSTRUMENTS

Initial Recognition:

(i) The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables/payables and where cost of generation of fair value exceeds benefits, which are initially measured at transaction price. Transaction costs directly related to the acquisition or issue of the financial assets and financial liabilities (other than financial assets and financial liabilities through profit & loss account) are added to or deducted from the cost of financial assets or financial liabilities. Transaction cost directly attributed to the acquisition of financial assets or financial liabilities at fair value through profit & loss account are recognized immediately in the statement of profit & loss.

Subsequent Recognition:

Non-derivative financial instruments

(i) Financial assets carried at amortized cost: A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

(ii) Financial assets at fair value through other comprehensive income: A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

J. TRADE RECEIVABLES

Trade receivables represents amount billed to customers as credit sales and are net off;

a) any amount billed but for which revenues are reversed under the different accounting standard and

b) impairment for trade receivables, which is estimated for amounts not expected to be collected in full.”

K. LOANS AND ADVANCES

Loans and advances are non derivative financial assets with fixed and determinable payments. This category includes the loans, cash and bank balances, other financial assets and other current assets.

Subsequent to initial measurement, loans and receivables are carried at amortized cost based on effective interest rate method less appropriate allowance for doubtful receivables.

Loans and advances are further classified as current and non-current depending on whether they will be realized within 12 months after the balance sheet date or beyond.

L. FINANCIAL LIABILITIES

(i) Financial liabilities are initially recognized at the fair value of the consideration received less directly attributable transaction cost.

(ii) Subsequent to initial measurement, financial liabilities are measured at amortized cost. The difference in the initial carrying amount of the financial liabilities and their redemption value is recognized in the statement of profit & loss over the contractual term using the effective interest rate method. This category includes the following class of liabilities; trade and other payables, borrowing; and other financial liabilities.

(iii) Financial liabilities are further classified as current and non-current depending whether they are payable within 12 months after the balance sheet date or beyond.

(iv) Financial liabilities are derecognized when the company is discharge from its obligation, they expire, are cancelled or replaced by a new liability with substantial modified terms.

M. EARNING PER SHARE

Basic Earnings Per Share is computed by dividing the net profit attributable to the equity shareholders of the company to the weighted average number of Shares outstanding during the period & Diluted earnings per share is computed by dividing the net profit attributable to the equity shareholders of the company after adjusting the effect of all dilutive potential equity shares that were outstanding during the period, the weighted average number of shares outstanding during the period including the weighted average number of equity shares that could have issued upon conversion of all dilutive potential.

N. INCOME TAXES

(i) CURRENT TAX

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

Current tax is expected tax payable on the taxable income for the year, using the tax rate enacted at the reporting date, and any adjustment to the tax payable in respect of the earlier periods.

Current tax assets and liabilities are offset where the company has legal enforceable right to offset and intends either to settle on net basis, or to realize the assets and settle the liability simultaneously.

(ii) DEFERRED TAX ASSETS / LIABILITIES

Deferred tax is recognized for all taxable temporary differences and is calculated based on the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is measured at the tax rates that are expected to be applied when the asset is realized or the liability is settled, based on the laws that have been enacted or substantively enacted at the reporting date.

Deferred tax assets are recognized only to the extent that it is probable that future taxable profits will be available against which the assets can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset and when the deferred tax balances relate to taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but the Group intends to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

(iii) CURRENT AND DEFERRED TAX FOR THE YEAR

Current and deferred tax are recognized in the statement of profit & loss, except when they relates to items that are recognized in other comprehensive income or directly in equity, in which case, the current tax and deferred tax is recognized directly in other comprehensive income or equity respectively.

O. EMPLOYEES BENEFITS

The company provides for the various benefits plans to the employees. These are categorized into defined benefits plans and defined contributions plans. Defined benefit plans includes the amount paid by the company towards the liability for Provident fund to the employees provident fund organization and Employee State Insurance fund in respect of ESI and defined benefits plans includes the retirement benefit such as gratuity and company absentees both accumulated and non-accumulated.

(i) In respect of Defined Contribution Plans contribution made to the specified fund based on the services rendered by the employees are charged to Statement of Profit & Loss in the year in which services are rendered by the employee.

(ii) Liability in respect of Defined Long Term benefit plan is determined at the present value of the amounts payable determined using actuarial valuation techniques performed by an independent actuarial at each balance sheet date using the projected unit credit methods. Gains and losses through re-measurements of the net defined benefit liability/assets are recognized in other comprehensive income. Past Service cost is recognized in the statement of profit & loss in the period of plan amendment.

(iii) Liabilities for accumulating paid absences is determined at the present value of the amounts payable determined using the actuarial valuation techniques performed by an independent actuarial at each balance sheet date using the projected unit credit method. Actuarial gain or losses in respect of accumulating paid absences are charged to statement of profit & loss account.

(iv) Liabilities for short term employee benefits are measured at undiscounted amount of the benefits expected to be paid and charged to Statement of Profit & Loss in the year in which the related service is rendered.

P. IMPAIRMENT

Financial assets

The company recognizes loss allowances using the expected credit loss model for the financial assets which are not fair valued through statement of profit and loss. Loss allowance on trade receivables, with no significant financing component is measured at an amount equal to lifetime expected credit loss. For all financial assets expected credit losses are measured at an amount equal to 12-month ECL unless there has been significant increase in credit risk from initial recognition in which case these are measured at lifetime expected credit loss. The amount of expected credit losses or reversal that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in the profit or loss for the period.

Intangible assets, property, plant and equipment

Intangible assets, property plant & equipment are evaluated for recoverability wherever events or changes in circumstances indicate that their carrying amount may not be recoverable.

For impairment testing, assets that do not generate independent cash flows are grouped together into cash generating units (CGUs).

For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value in use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU to which the asset belongs.

If such asset is considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit & loss if there have been changes in the estimates used to determine the recoverable amount. The carrying amount is increased to its revised recoverable amount, provided that this amount does not exceeds the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss has been recognized for the asset in prior years.

Q. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

(i) A provision is recognized, if as a result of past event the company has present legal or constructive obligations that is reasonably estimable and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pretax rate that reflects current market assessments of the time value of money and the risk specific to liability.

(ii) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the company. Contingent assets are not recognized in the financial statements. However due disclosures are made in the financial statements for the contingent assets, where economic benefits is probable and amount can be estimated reliably.

R. FOREIGN CURRENCY TRANSACTIONS

(i) The Company’s functional currency is Indian Rupees. Transactions in currency other than Indian Rupees are recorded at the rate, as declared by the custom and excise department, ruling on the date of transaction.

(ii) Foreign Currency monetary assets and liabilities remaining unsettled as at the balance sheet date are translated using the exchange rates as at the balance sheet date. Non-monetary assets and liabilities which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary assets and liabilities which are carried at fair value or other similar valuation denominated in foreign currency are reported using the exchange rates that existed when the fair values were determined.

(iii) Exchange differences arises on settlement/translation of Foreign Currency monetary assets and liabilities are recognized as income/expense through the Exchange Fluctuation Account in the year they arise.

(iv) Transaction gain or losses realized upon settlement of foreign currency transaction are included in determining the net profit for the period in which transaction is settled.

(v) Exchange difference arises on settlement / translation of foreign currency monetary assets and liabilities relating to acquisition of Property, Plant and Equipment till the period they are put to use for commercial production, are capitalized to the cost of assets acquired and provided for over the useful life of the Property, Plant and Equipment.

S. DEPRECIATION

(i) Normal depreciation on all property, plant & equipment except Land & Intangible Assets are provided from the date of put to use for commercial production on Straight Line Method at the useful lives prescribed in Schedule-II to The Companies Act, 2013 and after providing for the residual value (maximum to the extent of 5%) of the Fixed Assets as determined by the management.

(ii) Depreciation/Amortization on addition /deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition/deletions.

(iii) Depreciation/Amortization on additions/deletions to the fixed assets due to exchange rate fluctuation is provided on pro-rata basis since inception.

(iv) The estimated useful lives, residual values and depreciation method are reviewed at each financial year end and the effect of any change is accounted for on prospective basis.

T. GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the property, plant and equipment is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

U. PURCHASES

(i) Purchases returns / rebates are adjusted from the purchases of the year in which the returns take place / rebates allowed.

(ii) Purchases are accounted for “Net of VAT Credit availed on eligible inputs”.

V. CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account are provided for in the accounts on receipts/acceptances.

W. BORROWING COST

Borrowing cost are interest and other costs (including exchange differences relating to foreign currency borrowings to the extent they are regarded as an adjustment to interest costs) incurred in connection with the borrowing of funds. Borrowing cost directly attributable to the acquisition or construction of qualifying /eligible assets, intended for commercial production are capitalized as part of the cost of such assets. All other borrowing costs are recognized as an expense in the year in which they are incurred.

X. Recent Accounting Pronouncements Standards issued but not yet effective

In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards)(Amendments) Rules, 2017 notifying amendments to Ind AS 7, Statement of cash flows and Ind AS 102, Share based payments, applicable w.e.f. 1st April 2017. These amendments are in accordance with the recent amendments made by the International Accounting Standards Board (IASB) to IAS 7, Statement of Cash flows and IFRS 2 Share based payments respectively. The amendments to Ind AS 7 are applicable to the Company w.e.f 1st April 2017.

Amendment to Ind AS 7;

The amendment to Ind AS 7 requires the entities to provide disclosures that enables the users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non cash changes, suggesting inclusion of a reconciliation statements between opening and closing balances in the balance sheet for liabilities arising from financing activities to meet the disclosure requirement.

Amendment to Ind AS 102;

The amendment to Ind AS 102 provides specific guidance to measurement of cash settled awards, modification of cash settled awards and awards that include a net settlement feature in respect of withholding taxes.

It clarifies that the fair value of cash settled awards is determined on a basis consistent with that used for equity settled awards. Market based performance conditions and non vesting conditions are reflected in the fair values, but non market performance conditions and service vesting conditions are reflected in the estimate of the number of awards expected to vest. Also the amendment clarifies that the terms and conditions of a cash settled share based payment transaction are modified with the result that it becomes equity settled share based payment transaction, the transaction is accounted for as such from the date of modification. Further, the amendment requires the awards that include a net settlement feature in respect of withholding taxes to be treated as equity settled in entirety. The cash payment to the tax authority is treated as if it was part of an equity settlement.

Since, the impact of proposed changes in Ind AS 7 relates to the disclosure of the items included in the financial statements. These do not have any impact on the financial position of the company.


Mar 31, 2016

1 COMPANY PROFILE

Flex Foods Limited. was incorporated on 5th February, 1990 with the Registrar of Companies under the provisions of Companies Act 1956, having Corporate Identification Number (CIN) L15133UR1990PLC023970. The Registered office of Company is situated at Lal Tappar Industrial Area, P. O. Resham Majri, Haridwar Road, Dehradun (Uttarakhand).

Flex Foods Ltd. is engaged mainly in the business of cultivation and processing of Mushrooms, Herbs, Fruits & Vegetables in Freeze Dried, Air Dried and Individually Quick Frozen form. Flex Foods Limited has been selling its products mainly to the European and US markets.

2 SIGNIFICANT ACCOUNTING POLICIES

2.1 BASIS OF PREPARATION

The financial statements of the Company have been prepared and presented in accordance with the generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on accrual basis, and comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The accounting policies adopted by the Company are consistent with those used in previous year.

All Assets and Liabilities have been classified as Current or Non-current as per the Company''s normal operating cycle and other criteria set out in the Schedule III of the Companies Act, 2013.

2.2 CLASSIFICATION OF EXPENDITURE/INCOME Except Otherwise Indicated:-

(i) All expenditure and income are accounted for under the natural heads of account.

(ii) All expenditure and income are accounted for on accrual basis except when realization of income is uncertain.

2.3 USE OF ESTIMATES AND JUDGEMENTS

The preparation of the financial statements is in conformity with Indian Accounting Standards and requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about the carrying values of assets and liabilities that are readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on a going basis.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, in the period of the revision and future periods if the revision affects both current and future period.

2.4 VALUATION

(i) Fixed Assets

a) Tangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties(Net of Cenvat wherever applicable), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use.

b) Intangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises license fees and costs of implementation / system integration services.

(ii) Raw Material & Packing Material

Raw material and packing material are valued at lower of cost, based on First in First Out (FIFO) method arrived at after including freight inward directly attributable to acquisition or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(v) Cost of Consumable Stores & Spares

Spares & Consumables are valued at lower of cost based on First in First Out (FIFO) method or net realizable value.

2.5 FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates. on-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; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise.

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account.

(iv) Profit or loss on cancellation of forward contracts for transactions is adjusted as income / expense through Exchange Fluctuation Account in the year they arise.

2.6 DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land & Intangible Assets are provided on Straight Line Method as per the Schedule- II of The Companies Act, 2013 and after providing for the residual value with (maximum to the extent of 5%) of the Fixed Assets as determined by the management.

(ii) Intangible assets are written off over a period of five years from the date of put to use.

(iii) Depreciation/Amortization on addition /deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition/deletions.

(iv) Depreciation/Amortization on additions/deletions to the Fixed Assets due to Exchange Rate Fluctuation is provided on pro-rata basis since inception.

2.7 IMPAIRMENTS

The carrying amount of assets are periodically assessed by the management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired. Impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

2.8 GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

2.9 SALES

(i) Export Sales are accounted for on C & F / F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

2.10 PURCHASES

(i) Purchase returns are adjusted from the purchases of the year in which the returns take place.

(ii) Purchases are accounted for “Net of VAT Credit availed on eligible inputs”.

2.11 EMPLOYEES BENEFITS

(i) Defined long term benefit is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gain and losses in respect of post employment and other long term benefits are charged to Statement of Profit & Loss.

(ii) Defined Contribution Plans are charged to Statement of Profit & Loss based on the contribution made to the specified fund.

(iii) Short term employee benefits are charged to Statement of Profit & Loss at the undiscounted amount in the year in which the related service is rendered.

2.12 PROVISION FOR INCOME TAX

Income tax expenses are accrued in accordance with Accounting Standard-22 “Accounting for Taxes on Income” as notified by the Companies Accounting Standard (Rules) 2006, which include Current Tax and Deferred Tax. Provision for current tax is made after taking into considerations benefits admissible under the provision of the Income - Tax Act 1961. Profit Computed after adjustment in accordance with the accounting treatment suggested in Income Computation & Disclosure Standards issued by the Central Board of Direct Taxes. Deferred Tax Assets & Liabilities’ are measured using the current tax rates. Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognized only to the extent, there is a reasonable certainty that sufficient future taxable income will be available. Such deferred tax assets & other unrecognized deferred tax assets are re-assessed at each Balance Sheet date and the carrying value of the same are adjusted recognizing the change in the value of each such deferred tax assets.

2.13 CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided in the accounts on receipts/acceptances.

2.14 RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head.

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account.

2.15 BORROWING COST

Borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

2.16 EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) “Earning Per Share” as notified by the Companies Accounting Standard (Rules) 2006, Basic & Diluted Earnings Per Share is computed using the weighted average number of Shares outstanding during the period.

2.17 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) as notified by the Companies Accounting Standard (Rules) 2006

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the company. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2015

1.1 BASIS OF PREPARATION

The financial statements of the Company have been prepared and presented in accordance with the generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on accrual basis, and comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The accounting policies adopted by the Company are consistent with those used in previous year.

All Assets and Liabilities have been classified as Current or Non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III of the Companies Act, 2013.

2.2 CLASSIFICATION OF EXPENDITURE/INCOME Except Otherwise Indicated:

(i) All expenditure and income are accounted for under the natural heads of account.

(ii) All expenditure and income are accounted for on accrual basis except when realisation of income is uncertain.

2.3 USE Of Estimates AND Judgements

The preparation of the financial statements is in conformity with Indian Accounting Standards and requires Management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about the carrying values of assets and liabilities that are readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on a going basis.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, in the period of the revision and future periods if the revision affects both current and future period.

2.4 VALUATION

(i) Fixed Assets

a) Tangible

Fixed Assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties (net of CENVAT), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use.

b) Intangible

Fixed Assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises license fees and costs of implementation / system integration services.

(ii) Raw Material & Packing Material

Raw material and packing material are valued at lower of cost, based on First in First Out (FIFO) method arrived at after including freight inward directly attributable to acquisition or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses and specific Payments and Benefits to Employees or net realizable value.

(v) Cost of Consumable Stores & Spares

Spares & Consumables are valued at lower of cost based on First in First Out (FIFO) method or net realizable value.

2.5 FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates.Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise.

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account.

(iv) Profit or loss on cancellation of forward contracts for transactions is adjusted as income / expense through Exchange Fluctuation Account in the year they arise

2.6 DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land & Intangible Assets are provided on Straight Line Method as per the Schedule-II of The Companies Act, 2013 and after providing for the residual value with (maximum to the extent of 5%) of the Fixed Assets as determined by the Management

(ii) Intangible assets are written off over a period of five years from the date of put to use.

(iii) Depreciation/Amortization on addition/deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition/ deletions.

(iv) Depreciation/Amortization on additions/deletions to the fixed assets due to exchange fluctuation rate is provided on pro-rata basis since inception.

2.7 IMPAIRMENTS

The carrying amount of assets are periodically assessed by the Management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired. Impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

2.8 GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

2.9 SALES

(i) Export Sales are accounted for on C & F / F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

2.10 purchases

(i) Purchase returns are adjusted from the purchases of the year in which the returns take place

(ii) Purchases are accounted for "Net of VAT Credit availed on eligible inputs" .

2.11 employees benefits

(i) Defined long term benefit is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gain and losses in respect of post employment and other long term benefits are charged to Statement of Profit & Loss.

(ii) Defined Contribution Plans are charged to Statement of Profit & Loss based on the contribution made to the specified fund.

(iii) Short term employee benefits are charged to Statement of Profit & Loss at the undiscounted amount in the year in which the related service is rendered.

2.12 PROVISION FOR INCOME TAX

Income tax expenses are accrued in accordance with Accounting Standard-22 "Accounting for Taxes on Income" as notified by the Companies Accounting Standard (Rules) 2006, which include Current Tax and Deferred Tax. Provision for current tax is made after taking into considerations benefits admissible under the provision of the Income - Tax Act 1961.Deferred Tax Assets & Liabiities are measured using the current tax rates.Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognized only to the extent, there is a reasonable certainty that sufficient future taxable income will be available.Such deferred tax assets & other unrecognized deferred tax assets are re-assessed at each balance Sheet date and the carrying value of the same are adjusted recognizing the change in the value of each such deferred tax assets.

2.13 CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided in the accounts on receipts/acceptances.

2.14 RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head.

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account.

2.15 BORROWING COST

borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

2.16 EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) "Earning Per Share" as notified by the Companies Accounting Standard (Rules) 2006, basic & Diluted Earning Per Share is computed using the weighted average number of Shares outstanding during the period.

2.17 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) as notified by the Companies Accounting Standard (Rules) 2006

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the company. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2014

1.1. Classification of expenditure/income

Except Otherwise Indicated:-

(i) All expenditure and income are accounted for under the natural heads of account.

(ii) All expenditure and income are accounted for on accrual basis.

1.2. USE OF ESTIMATES AND JUDGEMENTS

The preparation of the financial statements is in conformity with Indian Accounting Standards and requires Management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about the carrying values of assets and liabilities that are readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on a going basis.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, in the period of the revision and future periods if the revision affects both current and future period.

1.3 VALUATION

(i) Fixed Assets

a) Tangible

Fixed Assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties (net of CENVAT), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use.

b) Intangible

Fixed Assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises license fees and costs of implementation / system integration services.

(ii) Raw Material & Packing Material

Raw material and packing material are valued at lower of cost, based on First in First Out (FIFO) method arrived at after including freight inward directly attributable to acquisition or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing Expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses and specific Payments and Benefits to Employees or net realizable value.

(v) Cost of Consumable Stores & Spares

Spares & Consumables are valued at lower of cost based on First in First Out (FIFO) method or net realizable value.

1.4. FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates.Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise.

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account.

(iv) Profit or loss on cancellation of forward contracts for transactions is adjusted as income / expense through Exchange Fluctuation Account in the year they arise.

1.5. DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land & Software are provided on Straight Line Method at the rates prescribed in Schedule-XIV of the Companies Act, 1956.

(ii) Intangible Assets are written-off over a period of five years from the date of put to use.

(iii) Depreciation/Amortization on addition /deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition / deletions.

(iv) Depreciation/Amortization on additions/deletions to the fixed assets due to exchange fluctuation rate is provided on pro-rata basis since inception.

1.6. IMPAIRMENTS

The carrying amount of assets are periodically assessed by the Management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired. Impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

1.7. GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

1.8 SALES

(i) Export Sales are accounted for on C & F / F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

1.9. PURCHASES

(i) Purchases are accounted for "Net of VAT Credit availed on eligible inputs"

(ii) Purchase returns are adjusted from the purchases of the year in which the returns take place.

1.10. EMPLOYEES BENEFITS

(i) Defined long term benefit is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gain and losses in respect of post employment and other long term benefits are charged to Statement of Profit & Loss.

(ii) Defined Contribution Plans are charged to Statement of Profit & Loss based on the contribution made to the specified fund.

(iii) Short term employee benefits are charged to Statement of Profit & Loss at the undiscounted amount in the year in which the related service is rendered.

1.11. PROVISION FOR INCOME TAX

Income tax expenses are accrued in accordance with Accounting Standard-22 "Accounting for Taxes on Income" as notified by the Companies Accounting Standard (Rules) 2006, which include Current Tax and Deferred Tax. Provision for current tax is made after taking into considerations benefits admissible under the provision of the Income- Tax Act 1961. Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognized only to the extent, there is a reasonable certainty that sufficient future taxable income will be available.

1.12. CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided in the accounts on receipts/acceptances.

1.13. RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head.

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account.

1.14. BORROWING COST

Borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

1.15. EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) "Earning Per Share" as notified by the Companies Accounting Standard (Rules) 2006, Basic & Diluted Earning Per Share is computed using the weighted average number of Shares outstanding during the period.

1.16. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) as notified by the Companies Accounting Standard (Rules) 2006

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the company. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2013

1.1 CLASSIFICATION OF EXPENDITURE/INCOME

Except Otherwise Indicated:-

(i) All expenditure and income are accounted for under the natural heads of account.

ii) All expenditure and income are accounted for on accrual basis.

1.2 VALUATION

(i) Fixed Assets

a) Tangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties (net of CENVAT), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use

b) Intangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises license fees and costs of implementation / system integration services.

(ii) Raw Materials & Packing Materials.

Raw material and packing material are valued at lower of cost, based on First in First Out (FIFO) method or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building , specific Manufacturing expenses and specific Payments and Benefits to Employees or net realizable value.

(v) Cost of Consumable Stores

Spares & Consumables are valued at lower of cost based on First in First Out (FIFO) method or net realizable value

1.3 FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise.

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account.

(iv) Profit or Loss on cancellation of forward contracts for transactions is adjusted as income / expense through Exchange Fluctuation Account in the year they arise.

1.4 DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land & Software are provided on Straight Line Method at the rates prescribed in Schedule-XIV of The Companies Act, 1956.

(ii) Intangible assets are written-off over a period of five years from the date of put to use.

(iii) Depreciation/Amortization on addition/deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition/ deletions.

(iv) Depreciation/Amortization on additions/deletions to the fixed assets due to exchange fluctuation rate is provided on pro-rata basis since inception.

1.5 IMPAIRMENTS

The carrying amount of assets are periodically assessed by the Management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired. Impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

1.6 GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

1.7 SALES

(i) Export Sales are accounted for on C & F / F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

1.8 PURCHASES

(i) Purchase returns are adjusted from the purchases of the year in which the returns take place.

(ii) Purchases are accounted for "Net of VAT Credit availed on eligible inputs"

1.9 EMPLOYEES BENEFITS

(i) Defined long term benefit is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gain and losses in respect of post employment and other long term benefits are charged to Statement of Profit & Loss.

(ii) Defined Contribution Plans are charged to Statement of Profit & Loss based on the contribution made to the specified fund.

(iii) Short term employee benefits are charged to Statement of Profit & Loss at the undiscounted amount in the year in which the related service is rendered.

1.10 PROVISION FOR INCOME TAX

Income tax expenses are accrued in accordance with Accounting Standard-22 "Accounting for Taxes on Income" as notified by the Companies Accounting Standard (Rules) 2006, which include Current Tax and Deferred Tax. Provision for current tax is made after taking into considerations benefits admissible under the provision of the Income - Tax Act 1961. Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognized only to the extent, there is a reasonable certainty that sufficient future taxable income will be available.

1.11 CLAIMS BY / AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided in the accounts on receipts/acceptances.

1.12 RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head.

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account.

1.13 BORROWING COST

Borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

1.14 EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) "Earning Per Share" as notified by the Companies Accounting Standard (Rules) 2006, Basic & Diluted Earning Per Share is computed using the weighted average number of Shares outstanding during the period.

1.15 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) as notified by the Companies Accounting Standard (Rules) 2006

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the Company. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2012

1.1 CLASSIFICATION OF EXPENDITURE/INCOME

Except Otherwise Indicated:-

(i) All expenditure and income are accounted for under the natural heads of account.

(ii) All expenditure and income are accounted for on accrual basis.

1.2 VALUATION

(i) Fixed Assets

a) Tangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties (net of CENVAT), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use

b) Intangible

Fixed assets are stated at cost and other incidental expenses, less accumulated depreciation and impairment losses. Cost comprises license fees and costs of implementation / system integration services.

(ii) Raw Materials & Packing Materials.

Raw material and packing material are valued at lower of cost, based on First in First Out (FIFO) method or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building , specific Manufacturing expenses and specific Payments and Benefits to Employees or net realizable value.

(v) Cost of Consumable Stores

Spares & Consumables are valued at lower of cost based on First in First Out (FIFO) method or net realizable value

1.3 FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise.

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account.

(iv) Profit or loss on cancellation of forward contracts for transactions is adjusted as income / expense through Exchange Fluctuation Account in the year they arise.

1.4 DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land & Software are provided on Straight Line Method at the rates prescribed in Schedule-XIV of The Companies Act, 1956.

(ii) Intangible assets are written-off over a period of five years from the date of put to use.

(iii) Depreciation/Amortization on deletions to Fixed Assets is provided on pro-rata basis from/to the date of addition/ deletions.

(iv) Depreciation/Amortization on additions/deletions to the fixed assets due to exchange fluctuation rate is provided on pro-rata basis since inception.

1.5 IMPAIRMENTS

The carrying amount of assets are periodically assessed by the Management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired. Impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

1.6 GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards Capital Outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Statement of Profit & Loss over the period and in the proportion in which depreciation is charged.

(ii) Revenue Grants are recognized in Statement of Profit & Loss.

1.7 SALES

(i) Export Sales are accounted for on C & F / F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

1.8 PURCHASES

(i) Purchase returns are adjusted from the purchases of the year in which the returns take place.

(ii) Purchases are accounted for "Net of VAT Credit availed on eligible inputs

1.9 EMPLOYEES BENEFITS

(i) Defined long term benefit (other than leave encashment) is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gain and losses in respect of post employment and other long term benefits are charged to Statement of Profit & Loss.

(ii) Defined long term benefits in respect of leave encashment is charged to profit & loss account based on the leave entitlement of employees remaining unutilised at the end of the year, at the undiscounted amount.

(iii) Defined Contribution Plans are charged to Statement of Profit & Loss based on the contribution made to the specified fund.

(iv) Short term employee benefits are charged to Statement of Profit & Loss at the undiscounted amount in the year in which the related service is rendered.

1.10 PROVISION FOR INCOME TAX

Income tax expenses are accrued in accordance with Accounting Standard-22 "Accounting for Taxes on Income" as notified by the Companies Accounting Standard (Rules) 2006, which include Current Tax and Deferred Tax. Provision for current tax is made after taking into considerations benefits admissible under the provision of the Income Tax Act 1961. Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognised only to the extent, there is a reasonable certainty that sufficient future taxable income will be available.

1.11 CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided in the accounts on receipts/acceptances.

1.12 RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head.

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account.

1.13 BORROWING COST

Borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

1.14 EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) "Earning Per Share" as notified by the Companies Accounting Standard (Rules) 2006, Basic & Diluted Earning Per Share is computed using the weighted average number of Shares outstanding during the period.

1.15 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) as notified by the Companies Accounting Standard (Rules) 2006

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the company. Contingent assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2010

1) CLASSIFICATION OF EXPENDITURE/INCOME

Except otherwise Indicated

(i) All expenditure and income are accounted for under the natural heads of account.

(li) All expenditure and income are accounted on accrual basis.

2) VALUATION

(i) Fixed Assets

Fixed assets are stated 3t cost and other incidental expenses, less accumuJated depreciation and impairment losses. Cost comprises the purchase price and any attributable cost such as duties (net of CENVAT), freight, borrowing cost, adjustment on account of foreign exchange fluctuations, erection and commissioning expenses incurred in bringing the asset to its working condition for its intended use.

(ii) Raw Materials and Packing Materials

Raw materials and packing materials are valued at tower of cost, based on First in First Out (FIFO) method or net realizable value.

(iii) Finished Goods

Finished Goods are valued at lower of cost, based on Firs! in First Out (FIFO) method, arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing Expenses including Excise Duty and specific Payments and Benefits to Employees or net realizable value.

(iv) Work-in-Progress

Work-in-Progress is valued at lower of cost based on First In First Out (FIFO) method arrived after including depreciation on Plant & Machinery, Electrical Installation and Factory Building, Repair & Maintenance on Factory Building, specific Manufacturing Expenses and specific Payments and Benefits to Employees or net realizable -. value, *

(v) Cost of Consumable Stores

Spares & Consumables are valued at tower of cost based on First in First Out (FIFO) method or net realizable value

<3> FOREIGN CURRENCY TRANSACTIONS

(i) Foreign Currency monetary items remaining unsettled at the year-end, are translated at year-end rates. Non- monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

(ii) Exchange differences on settled/translated monetary items are adjusted as income/expense through the Exchange Fluctuation Account in the year they arise

(iii) Difference between the forward and exchange rate on the date of transactions are adjusted over the period of the contract as an income / expense through the Exchange Fluctuation Account

(Iv) Profit or loss on cancellation of forward contracts for transactions are adjusted as income / expense through Exchange Fluctuation Account in the year they arise.

4) DEPRECIATION

(i) Normal depreciation on all Fixed Assets except Land are provided on Straight Line Method at the rates prescribedm Schedule-XIV to The Companies Act, 1956.

(ii) Depreciation on additions/deletions to Fixed Assets are provided on pro-rata basis from/to the date of addition/ deletions.

(iii) Depreciation on additions/deletions to the Fixed Assets due to exchange fluctuation rate are provided on pro-rata basis since inception.

5) IMPAIRMENTS

The carrying amount of assets are periodically assessed by the Management, using internal & external sources, to determine whether there is any indication that assets of concerned cash generating unit may be impaired impairment loss, if any is provided to the extent the carrying amount of assets of concerned cash generating unit exceeds their recoverable amount. The recoverable amount is higher of net selling price of assets of concerned cash generating unit and their present value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of assets of concerned cash generating unit and from their disposal at the end of their useful life.

6) GOVERNMENT GRANTS

(i) Capital Subsidy received from Government as contribution towards capital outlay for setting up the fixed assets is treated as Capital Grants which is recognized as Income in the Profil & Loss account over the period and in the proportion in which depreciation is charged

(ii) Revenue Grants are recognized in Profit & Loss Account.

7) SALES

(i) Export Sales are accounted for on C S F I F.O.B basis.

(ii) Sales Returns are adjusted from the sales of the year in which the returns take place.

8} PURCHASES

(i) Purchase returns are adjusted from the purchases of the year in which the returns take place.

(ii) Purchases are accounted for "Net of VAT Credit availed on eligible inputs".

9) EMPLOYEE BENEFITS

(i) Defined Long Term benefit (other than leave encashment) is recognized 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 Profit & Loss Account.

(ii) Defined long term benefits in respect of leave encashment is charged to profit & loss account based on the leave entillement of employees remaining unulilised at the end of the year, at the undiscounted amount.

(iii) Defined Contribution Plans are charged to profit & loss account based on the contribution made to Ihe specified fund.

(iv) Short term employee benefits are charged to Profit & Loss Account at the undiscounted amount in the year in which Ihe related service is rendered

10) INCOME TAX

Income lax expenses are accrued in accordance with Accounting Standard-22 "Accounting for Taxes on Income" issued by The Institute of Chartered Accountants of India, which inciude Current Tax and Deferred Tax. Deferred income tax reflects the impact of current year timing difference between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognised only to the extent, there is a reasonable certainty that sufficient future taxable income will be available.

11) CLAIMS BY/AGAINST THE COMPANY

Claims by/ against the Company arising on any account is provided In the accounts on receipts/acceptances.

12) RESEARCH & DEVELOPMENT EXPENSES

(i) All revenue expenditures on Research & Development activities are accounted for under the separate accounting head

(ii) All capital expenditures on Research & Development activities are accounted for under the natural heads of Fixed Assets Account

13) BORROWING COST

Borrowing cost attributable to the acquisition or construction of qualifying / eligible assets are capitalized as part of the cost of such assets. A qualifying / eligible asset is an asset that necessarily takes a substantial penod of time to get . ready for intended use All other borrowing costs are recognized as an expense and are charged to revenue in the year in which they are incurred.

14) EARNING PER SHARE

In accordance with the Accounting Standard-20 (AS-20) "Earning Per Share" issued by The Institute of Chartered Accountants of India. Baste & Diluted Earning Per Share Is computed using the weighted average number of Shares outstanding during the period.

15) PROVISIONS. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

In accordance with the Accounting Standard-29 (AS-29) issued by The Institute of Chartered Accountants of India *

a) Provisions are made for the present obligations where amount can be estimated reliably, and

b) Contingent liabilities are disclosed for possible obligations arising out of uncertain events not wholly in control of the Company. Contingent assets ana neither recognized nor disclosed in the financial statements

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