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Accounting Policies of Gujarat Ambuja Exports Ltd. Company

Mar 31, 2017

1.1 Company Information:

Gujarat Ambuja Exports Limited (Company) is a Public Limited Company domiciled in India. The Company has its registered office at ''''Ambuja Tower'''', Opp. Sindhu Bhavan, Sindhu Bhavan Road, Bodakdev, P.O. Thaltej, Ahmedabad, Gujarat 380 059. The Company is an Agro Processing conglomerate with various manufacturing plants at different locations in States of Gujarat, Maharashtra, Madhya Pradesh, Uttarakhand and Karnataka. The Company''s product profile includes Solvent Extraction comprising of all types of Oil Seed Processing, Edible Oil Refining, Cotton Yarn Spinning, Maize based Starch and its derivatives, Wheat Processing / Cattle Feed and Power Generation through Wind Mills, Bio gas, Thermal Power & Solar Plant mainly for internal consumption. The Company''s shares are listed on BSE and NSE.

1.2 Basis of Preparation of Financial Statements:

(i) Compliance with Ind-AS

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended).

For all periods up to and including the year ended 31st March, 2016, the Company prepared its financial statements in accordance with accounting standards notified under the Section 133 of the Companies Act, 2013 read together with paragraph 7 of the Companies (Accounts) Rules 2014 (Indian GAAP). These financial statements for the year ended 31st March, 2017 are the first the Company has prepared in accordance with Ind AS. Refer Note No. 1.22 for information on how the Company has adopted Ind AS.

The financial statements have been prepared on a historical cost basis, except for certain financial instruments which are measured at fair values.

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.

(ii) Current versus non-current classification

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

(iii) Rounding of amounts

The financial statements are presented in INR and all values are rounded to the nearest crore (INR 00,00,000) as per the requirement of Schedule III, unless otherwise stated.

1.3 Use of Estimates:

The preparation of the financial statements in conformity with Ind AS requires the 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. The application of accounting policies that require critical accounting estimates involving complex and subjective judgments and the use of assumptions in these financial statements have been disclosed in Note No. 1.4. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of the changes in circumstances surrounding the estimates.

The said estimates are based on the facts and events, that existed as at the reporting date, or that occurred after that date but provide additional evidence about conditions existing as at the reporting date.

1.4 Critical estimates and judgments:

The preparation of financial statements requires the use of accounting estimates which by definition will seldom equal the actual results. Management also need to exercise judgment in applying the Company''s accounting policies.

This note provides an overview of the areas that involved a higher degree of judgment or complexity, and items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgments is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

The areas involving critical estimates or judgment are:

Estimation of Defined benefit obligation - refer Note No. 1.16

Estimation of current tax expenses - refer Note No. 1.8

Government grant - refer Note No. 1.7

1.5 Fair value measurement:

The Company measures financial instruments, such as, derivatives at fair value as per Ind AS 113 at each balance sheet date. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

- Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities

- Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

- Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

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

1.6 Revenue recognition:

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government. As the recovery of excise duty flows to the Company on its own account, revenue includes excise duty.

However, sales tax/ value added tax (VAT) is not received by the Company on its own account. Rather, it is tax collected on value added to the commodity by the seller on behalf of the government. Accordingly, it is excluded from revenue.

The specific recognition criteria described below must also be met before revenue is recognized.

Sale of goods

Revenue from the sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

Excise duty paid for captive consumption of goods, where CENVAT credit is not available, is shown as excise expense.

Interest income

Interest income on financial asset is recognized using the effective interest rate (EIR) method.

Dividends

Dividend income from investment is accounted for when the right to receive is established, which is generally when shareholders approve the dividend.

Other Income

Other income is recognized when no significant uncertainty as to its determination or realization exists.

1.7 Government grants:

a Government grants are recognized in accordance with the terms of the respective grant on accrual basis considering the status of compliance of prescribed conditions and ascertainment that the grant will be received.

b Government grants related to revenue are recognized on a systematic and gross basis in the Statement of Profit and Loss over the period during which the related costs intended to be compensated are incurred.

c Government grants related to assets are recognized as income in equal amounts over the expected useful life of the related asset.

d When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset i.e. by equal annual installments.

1.8 Taxes:

Tax expenses comprise of current and deferred tax.

Current income tax

a Current tax is measured at the amount expected to be paid on the basis of reliefs and deductions available in accordance with the provisions of the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

b Current tax items are recognized in correlation to the underlying transaction either in P&L, OCI or directly in equity.

Deferred tax

a Deferred tax is provided using the balance sheet approach on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

b Deferred tax liabilities are recognized for all taxable temporary differences.

c Deferred tax assets are recognized for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, the carry forward of unused tax credits and unused tax losses can be utilized.

d The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

e Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is the reporting date.

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

g Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities.

h The Company recognizes tax credits in the nature of MAT credit as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e., the period for which tax credit is allowed to be carried forward. In the year in which the Company recognizes tax credits as an asset, the said asset is created by way of tax credit to the Statement of Profit and Loss. The Company reviews such tax credit asset at each reporting date and writes down the asset to the extent, the Company does not have convincing evidence that it will pay normal tax during the specified period. Deferred tax includes MAT credit.

1.9 Property, Plant and Equipment:

Under the previous GAAP (Indian GAAP), fixed assets (including Capital work in progress) are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises the purchase price, borrowing costs, if capitalization criteria are met, directly attributable cost of bringing the asset to its working condition for the intended use. The Company has elected to regard previous GAAP carrying values of property as deemed cost at the date of transition to Ind AS.

Capital Work in progress included in PPE is stated at cost, net accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term constructions projects if the recognition criteria is met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred.

The Company adjusts exchange differences arising on translation difference/settlement of long term foreign currency monetary items outstanding as at 31st March, 2016 and pertaining to the acquisition of a depreciable asset to the cost of asset and depreciates the same over the remaining life of the asset. The depreciation on such foreign exchange difference is recognized from first day of its financial year.

Borrowing cost relating to acquisition/construction of fixed assets which take substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as prescribed under Part C of Schedule II of the Companies Act, 2013 except for the assets mentioned below for which useful lives estimated by the management. The identified component of fixed assets are depreciated over the useful lives and the remaining components are depreciated over the life of the principal assets.

In respect of Power Plant and Biogas Engines, the Company based on technical evaluation, identified the assets and components and reassessed the remaining useful lives of tangible fixed assets and depreciation is provided accordingly.

The following is the useful life of each category of assets in respect of Power Plant and Biogas Engines:

The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.

Further, the Company evaluated the useful life of certain components of Plant and Machinery, the impact of which is not material. Assets costing Rs.5,000 or less are fully depreciated in the year of purchase. Leasehold land is amortized over the period of lease. Leasehold improvements are amortized over the period of lease or estimated useful life, whichever is lower.

1.10 Intangible assets:

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses. Internally generated intangibles, excluding capitalized development costs, are not capitalized and the related expenditure is reflected in profit and loss in the period in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either finite or indefinite.

Intangible assets with finite lives are amortized over the useful life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates. The amortization expenses on intangible assets with finite lives is recognized in the Statement of Profit and Loss unless such expenditure forms part of carrying value of another asset.

Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually, either individually or at the cash generating unit level. The assessment of indefinite life Is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the asset is derecognized.

The Company has elected to regard previous GAAP carrying value of Intangible Assets as deemed cost at the date of transition to Ind AS

1.11 Borrowing costs:

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs. General borrowing costs are capitalized at the weighted average of such borrowings outstanding during the year.

1.12 Leases:

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

For arrangements entered into prior to 1st April, 2015 the Company has determined whether the arrangement contain lease on the basis of facts and circumstances existing on the date of transition.

Company as a lessee

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a finance lease.

Finance leases are capitalized at the commencement of the lease at the inception date fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in finance costs in the Statement of Profit and Loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Company''s general policy on the borrowing costs. Contingent rentals are recognized as expenses in the periods in which they are incurred.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognized as an expense in the Statement of Profit and Loss on a straight-line basis over the lease term except the case where incremental lease reflects inflationary effect and lease expense is accounted in such case by actual rent for the period.

1.13 Inventories:

Inventories are valued as under:

a RAW MATERIALS, PACKING MATERIALS AND STORES & SPARES :

Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis. Due provision for obsolescence is made.

b FINISHED GOODS & WORK IN PROGRESS :

At cost or net realizable value, whichever is lower. Cost is determined on absorption basis. Due provision for obsolescence is made.

c BY- PRODUCTS :

At net realizable value

d STOCK-IN-TRADE :

Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis.

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

1.14 Impairment of financial assets & non-financial assets:

a Financial assets

The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, ECLs are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of ECL (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 Statement of Profit and Loss.

b Non-financial assets

Intangible assets and Property, Plant and Equipment are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. 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 assets are 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 and Loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior year.

Goodwill is tested for impairment annually as at every year end and when circumstances indicates that the carrying value may be impaired.

Impairment is determined for goodwill by assessing the recoverable amount of each Cash Generating Unit (i.e. CGU) (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognized. Impairment loss is recognized. Impairment losses relating to goodwill cannot be reversed in future periods.

Intangible assets with indefinite useful lives are tested for impairment annually as at year end at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.

1.15 Provisions, Contingent Liabilities and Contingent Assets:

a Provisions are recognized when the Company has present obligation (legal or constructive) as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation. Contingent Liabilities are disclosed by way of notes to Financial Statements. Contingent assets are not recognized in the financial statements but are disclosed in the notes to the financial statements where an inflow of economic benefits is probable. Provisions and contingent liabilities are reviewed at each Balance Sheet date.

b If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability.

1.16 Employee benefits:

a Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognized in the period in which the employee renders the related service.

b Post-Employment Benefits:

i) Defined Contribution Plans:

State governed Provident Fund Scheme and Employees State Insurance Scheme are defined contribution plans. The contribution paid / payable under the schemes is recognized during the period in which the employees render the related services.

ii) Defined Benefit Plans:

The Employee''s Gratuity Fund Scheme and compensated absences is Company''s defined benefit plans. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

For defined benefit plans, the amount recognized as ''Employee benefit expenses'' in the Statement of Profit and Loss is the cost of accruing employee benefits promised to employees over the year and the costs of individual events such as past/ future service benefit changes and settlements (such events are recognized immediately in the Statement of Profit and Loss). The amount of net interest expense calculated by applying the liability discount rate to the net defined benefit liability or asset is charged or credited to ''Finance costs'' in the Statement of Profit and Loss. Any differences between the interest income on plan assets and the return actually achieved, and any changes in the liabilities over the year due to changes in actuarial assumptions or experience adjustments within the plans, are recognized immediately in ''Other comprehensive income'' and subsequently not reclassified to the Statement of Profit and Loss.

All defined benefit plans obligations are determined based on valuations, as at the Balance Sheet date, made by independent actuary using the projected unit credit method. The classification of the Company''s net obligation into current and noncurrent is as per the actuarial valuation report.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognize the obligation on net basis. Gains or losses on the curtailment or settlement of any defined benefits plans are recognized when the curtailment or settlement occurs. Past service cost is recognized as expense on a straight-line basis over the average period until the benefits become vested.

c Long Term Employee Benefits:

The employees'' long term compensated absences are Company''s defined benefit plans. The present value of the obligation is determined based on the actuarial valuation using the projected unit credit method as at the date of the balance sheet. In case of funded plans, the full value of plan assets is reduced from the gross obligation to recognize the obligation on the net basis.

1.17 Financial instruments: Investments and other financial assets

(i) Classification

The Company classifies its financial assets in the following measurement categories:

(1) those to be measured subsequently at fair value (either through other comprehensive income, or through the Statement of Profit and Loss), and

(2) those measured at amortized cost.

The classification depends on the Company''s business model for managing the financial assets and the contractual terms of the cash flows.

(ii) Measurement

At initial recognition, the Company measures a financial asset at its fair value. Transaction costs of financial assets carried at fair value through the Profit and Loss are expensed in the Statement of Profit and Loss.

Debt instruments:

Subsequent measurement of debt instruments depends on the Company''s business model for managing the asset and the cash flow characteristics of the asset. The Company classifies its debt instruments into following categories:

(1) Amortized cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. Interest income from these financial assets is included in other income using the effective interest rate method.

(2) Fair value through other comprehensive Income

Assets that do not meet the criteria for amortized cost are measured at fair value through Other Comprehensive Income. Interest income from these financial assets is included in other income.

Equity instruments

The Company measures its equity investment other than in subsidiaries, joint ventures and associates at fair value through profit and loss. However where the Company''s management makes an irrevocable choice on initial recognition to present fair value gains and losses on specific equity investments in other comprehensive income (Currently no such choice made), there is no subsequent reclassification, on sale or otherwise, of fair value gains and losses to the Statement of Profit and Loss.

Financial liabilities

Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities are initially measured at the amortized cost unless at initial recognition, they are classified as fair value through profit and loss. Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortized cost using the effective interest method.

1.18 Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Company''s cash management.

1.19 Cash flow statement:

Cash flows are reported using the indirect method, whereby profit for the period is adjusted for the effects of transactions of a noncash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company are segregated.

1.20 Standard Issued but not yet effective:

In March 2017, the Ministry of Corporate Affairs has issued the Companies (Indian Accounting Standards) (Amendment) Rules, 2017, notifying amendments to Ind AS 7, ''Statement of Cash Flows'' and Ind AS 102, ''Share-based Payments''. These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, ''Statement of Cash Flows'' and IFRS 2, ''Share-based Payment'', respectively. The amendments are applicable to the Company from 1st April, 2017.

Amendment to Ind AS 7

The amendment to Ind AS 7 required the entities to provide disclosures that enables 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 between the opening and closing balances in the balance sheet for liabilities arising from financing activities, to meet the disclosure requirement.

The Company has evaluated the disclosure requirements of the amendment and the effect on the financial statements is not expected to be material.

Amendment to Ind AS 102

The amendment to Ind AS 102 provides specific guidance for the measurement of cash settled awards, modification of cash settled awards and awards that include a net settlement features in respect of withholding taxes. As the Company does not have such nature of transaction, this amendment does not have any effect on the financial statements of the Company.

1.21 Proposed Dividend and authorization of financial statements:

Dividend recommended by the Board of Directors is not provided for in the accounts, and is pending approval at the Annual General Meeting. The financial statements were authorized for issue by directors on 13th May, 2017.

1.22 Note on First Time Adoption of Ind AS:

The accounting policies set out in the note here have been applied in preparing the financial statements for the year ended 31st March, 2017, the comparative information presented in these financial statements for the year ended 31st March, 2016 and in the preparation of an opening Ind AS balance sheet at 1st April, 2015 [the Company''s date of transition].

In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies [Accounting Standards] Rules, 2006 [as amended] and other relevant provisions of the Act [Indian GAAP]. An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following notes.

Exemptions and exceptions availed:

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from Indian GAAP to Ind AS.

Optional exemptions

a Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the Indian GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their Indian GAAP carrying values.

b Leases

Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected to be not material. The Company has elected to apply this exemption for such contracts/arrangements.

Mandatory exceptions

c Estimates

An entity''s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with Indian GAAP [after adjustments to reflect any difference in accounting policies], unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1st April, 2015 and 31st March, 2016 are consistent with the estimates as at the same date made in conformity with Indian GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under Indian GAAP:

a Investment in equity instruments carried at FVTPL.

b Investment in debt instruments carried at Amortized Cost.

c Impairment of financial assets based on expected credit loss model.

d Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

e De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity''s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company''s management had previously issued its audited financial results for the year ended 31st March, 2016 on 30th April, 2016, that were all prepared in accordance with the recognition and measurement principles of the Companies (Accounting Standards) Rules, 2006 prescribed under Section 133 of the Companies Act, 2013, read with the relevant rules issued there under and other accounting principles generally accepted in India. The Company''s management has now prepared the Ind AS Financial Statements for the year ended 31st March, 2017 in accordance with the recognition and measurement principles laid down by the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with relevant Rules issued thereunder and other accounting principles generally accepted in India.

The Company has prepared a reconciliation of the amounts of net profit as reported under the Indian GAAP to those computed as per Ind AS and the same is given in note below. The Company has also prepared a reconciliation of the amounts of total equity as reported under the Indian GAAP to those computed as per lnd AS and the same is given in note below.

1.23 Note on Transition to Ind AS - Reconciliations:

The following reconciliations provide the explanations and quantification of the differences arising from the transition from Indian GAAP to Ind AS in accordance with Ind AS 101:

I. Reconciliation of Equity as at 1st April, 2015

II. A. Reconciliation of Equity as at 31st March, 2016

B. Reconciliation of Statement of Profit and Loss for the year ended 31st March, 2016

III. Adjustments to Statement of Cash Flows for the year ended 31st March, 2016


Mar 31, 2016

A. BASIS OF ACCOUNTING:

The Financial Statements of Company have been prepared in accordance with the Generally Accepted Accounting Principles in
India (Indian GAAP). The Company has prepared these Financial Statements to comply in all material respects with the Accounting
Standards notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules,
2014. The Financial Statements have been prepared on an accrual basis and under the historical cost convention. The accounting
policies adopted in the preparation of Financial Statements are consistent with those of previous year except for the change in
accounting policy explained below.

B. USE OF ESTIMATES:

Preparation of Financial Statements are in conformity with the Generally Accepted Accounting Principles which require
management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the
Financial Statements and the reported amount of revenues and expenses during the reporting period.
Difference between the actual result and estimates, are recognized in the period in which the results are known/materialized.

C. CURRENT /NON-CURRENT CLASSIFICATION:

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 to the Companies Act, 2013. Based on the nature of the products and the time between the
acquisition of assets or inventories for processing and their realization in cash and cash equivalents, the Company has ascertained
its normal operating cycle as twelve months for the purpose of current / non-current classification of assets and liabilities.

D. TANGIBLE AND INTANGIBLE FIXED ASSETS & DEPRECIATION:

i) Fixed Assets are stated at cost of acquisition & installation, net of CENVAT and VAT credits availed if any, less accumulated
depreciation and impairment loss, if any. The cost of fixed assets comprises of its purchase price, import duties and any
directly attributable cost of bringing the asset to its working condition for its intended use. Expenses directly attributable
to new manufacturing facilities during its construction period are capitalized. Profit or loss on disposal of tangible assets is
recognized in the Statement of Profit & Loss.

Tangible assets not ready for the intended use on the date of Balance Sheet are disclosed as Capital Work-in-Progress.
Advances given towards acquisition of fixed assets outstanding at each Balance Sheet date are disclosed as Capital Advances
under Non-Current Loans and Advances,

ii) Borrowing costs incurred during the period of construction/acquisition of assets is added to the cost of Fixed Assets,

iii) Major expenses on modification /alterations increasing efficiency/capacity of the fixed assets are also capitalized,

iv) Leasehold land is depreciated over the life of the lease.

v) a) The Company provides depreciation with reference to the estimated useful lives of Fixed Assets as prescribed by
Schedule II of the Companies Act, 2013.

In respect of Power Plant and Biogas Engines, the Company based on technical evaluation, identified the assets and
components and reassessed the remaining useful lives of tangible fixed assets and depreciation is provided. The
following is the useful life of each category of assets in respect of Power Plant and Biogas Engines:

Further, the Company evaluated the useful life of certain components of Plant and Machinery, the impact of which is not material.

Assets costing Rs, 5,000 or less are fully depreciated in the year of purchase. Leasehold land and Leasehold improvements are amortized over a period of lease,

b) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications as prescribed under Schedule II. Useful life of components of Plant and Machinery are identified and evaluated for providing depreciation,

vi) IMPAIRMENT OF ASSETS:

The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/
external factors. An impairment loss is recognized wherever the carrying amount of fixed assets exceeds its recoverable
amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the
present value of estimated future cash flows.


vii) INTANGIBLE FIXED ASSETS:

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition intangible
assets are carried at cost less accumulated amortization and accumulated impairment loss, if any. Intangible assets are
amortized on straight line basis over the useful life of the asset not exceeding ten years.

E. INVESTMENTS:

Investments are classified into current and non-current investments. Non-current investments are carried at cost. A provision for
diminution in value of non-current investments is made for each investment individually, if such decline is other than temporary.
Current investments are stated at the lower of cost and fair value, computed category-wise.

F. INVENTORIES:

Inventories are valued as under:

i) RAW MATERIALS, PACKING MATERIALS AND Valued at lower of cost or net realizable value and for this purpose
STORES & SPARES : cost is determined on weighted average basis. Due provision for obsolescence is made,

ii) FINISHED GOODS & WORK IN PROGRESS : At cost or net realizable value, whichever is lower. Cost is determined on absorption basis. Due provision for obsolescence is made,

iii) BY-PRODUCTS: At net realizable value,

iv) TRADED GOODS : Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis.

G. TRADE RECEIVABLES AND LOANS & ADVANCES:

Trade Receivables and Loans & Advances are stated after making adequate provisions for doubtful balances.
H. REVENUE RECOGNITION:
i) SALES:

a) Revenue from sale of goods is recognized, when all significant contractual obligations have been satisfied, the property
in the goods is transferred for a price, significant risks and rewards of ownership are transferred to the customers, no
effective ownership is retained and no significant uncertainty exists as to its realization or collection.

b) Sales (net off trade and cash discounts) is inclusive of excise, but excludes export incentives/licenses, VAT/sales tax.

c) Excise duty paid for captive consumption of goods, where CENVAT credit is not available, is shown as excise expense,

ii) EXPORT BENEFITS/INCENTIVES:

The benefits are accounted on the accrual basis,

iii) DIVIDEND INCOME:

Dividend income from investment is accounted for when the right to receive is established,

iv) INTEREST INCOME:

Interest income is recognized on the time proportion basis.

I. EMPLOYEE BENEFITS:

i) Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognized in the period in which the employee renders the related service,

ii) Post-Employment Benefits:

a) Defined Contribution Plans:

State governed Provident Fund Scheme and Employees State Insurance Scheme are defined contribution plans. The
contribution paid / payable under the schemes is recognized during the period in which the employees render the
related services.

b) Defined Benefit Plans:

The Employee''s Gratuity Fund Scheme and compensated absences is Company''s defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognized immediately in the Statement of Profit & Loss.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognize the obligation on net basis.

Gains or losses on the curtailment or settlement of any defined benefits plans are recognized when the curtailment or settlement occurs. Past service cost is recognized as expense on a straight-line basis over the average period until the benefits become vested.

iii) Long Term Employee Benefits:

The obligation for long term employee benefits such as long term compensated absences, is recognized in the same manner
as in case of defined benefit plans as mentioned in ii (b) above.

J. BORROWING COSTS:

Borrowing cost includes interest, amortization of ancillary costs incurred in connection with arrangements of borrowing. Borrowing
costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalized as part
of cost of such assets till the activities necessary for its intended use are complete. General borrowing costs are capitalized at the
weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in Statement of Profit &
Loss of the year in which incurred.

K. TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognized,
on timing difference, being the difference between taxable income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred
tax assets are recognized only if there is virtual certainty that sufficient future taxable income will be available against which such
assets can be realized. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization in
future. Such assets are reviewed at each Balance Sheet date to reassess realization.

Deferred tax in respect of timing differences which reverse during the tax holiday period are not recognized. However, Deferred
tax in respect of timing differences which reverse after the tax holiday period are recognized in the year in which the timing
differences originate.

Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit & Loss as current tax. The Company recognizes
MAT credit available as an asset only for the extent that there is convincing evidence that the Company will pay normal income
tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the
Company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of
Minimum Alternative Tax under the Income-Tax Act, 1961, the said asset is created by way of credit to the Statement of Profit &
Loss and shown as "MAT Credit Entitlement". The Company reviews the "MAT credit entitlement" asset at each reporting date and
writes down the asset to the extent the Company does not have convincing evidence that it will pay normal tax during the specified
period.

Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognized amounts
and there is an intention to settle the asset and liability on a net basis.

L. FOREIGN CURRENCY TRANSACTIONS:

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction,

ii) Monetary items denominated in foreign currency at the yearend are translated at the exchange rates prevailing at the Balance Sheet date.

iii) Premium or discount arising at the inception of the forward exchange contract is amortized as income or expense over the
period of the contract. Any profit or loss arising in renewal or cancellation of forward exchange contracts is recognized as
income or expense during the year.

iv) The Company accounts for exchange differences arising on translation/ settlement of foreign currency monetary items as
below:

a) Exchange differences arising on long term foreign currency monetary items related to acquisition of fixed assets are
capitalized or recapitalized from the cost of assets and are depreciated over the remaining useful life of the assets.

b) Exchange differences arising on other long term foreign currency items are accumulated in the "Foreign Currency
Monetary Item Translation Difference Account" and amortized over the remaining life of the concerned monetary item.

c) All other exchange differences are recognized as income or expenses in the period in which they arise.

For the purpose of (a) and (b) referred above, the Company treats a foreign monetary item as "Long term Foreign Currency
Monetary Item", if it has a term of 12 months or more at the date of origination.

M. DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING:

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations
relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial
instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the
Accounting Standard (AS 30) on ''Financial Instruments - Recognition and Measurement''. Changes in the fair value of the contracts
that are designated and effective as cash flow hedge is directly recorded in the Hedge Reserve Account and is recognized in the
Statement of Profit & Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses
on the ineffective transactions are recognized immediately in the Statement of Profit & Loss. The premium or discount arising at
the inception of forward exchange contract is amortized and recognized as an expense/income over the life of the contract.

N. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions are recognized when the Company has present obligation as a result of past events, for which it is probable that an
outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made
for the amount of the obligation.

Contingent Liabilities are disclosed by way of notes to Financial Statements. Contingent Assets are neither recognized nor disclosed
in the Financial Statements. Provisions and contingent liabilities are reviewed at each Balance Sheet date.

O. CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE:

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the
Company are considered for preparing the Financial Statements.

P. RESEARCH AND DEVELOPMENT EXPENSES:

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged
to the Statement of Profit & Loss of the period in which they are incurred.

Q. GOVERNMENT GRANTS:

i) The grants/subsidies received in the nature of promoters'' contribution are treated as capital receipts and credited to Capital Reserve,

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value,

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to ''Other Income'' in the Statement of Profit & Loss.

R. EXCISE DUTY:

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim.

S. SEGMENT REPORTING:

i) Identification of segments

The Company''s operating businesses are organized and managed separately according to the nature of products and services
provided, with each segment representing a strategic business unit that offers different products and serves different
markets. The analysis of geographical segments is based on the areas in which major operating divisions of the Company
operate.

ii) Inter-segment transfers

The Company generally accounts for intersegment sales and transfers at cost plus appropriate margins,

iii) Allocation of common costs

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs,

iv) Unallocated items

Unallocated items include general corporate income and expense items which are not allocated to any business segment,

v) Segment accounting policies

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and
presenting the Financial Statements of the Company as a whole.

T. EARNINGS PER SHARE:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after
deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding
during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as
bonus issue, bonus element in a rights issue, share split and reverse share split (consolidation of shares) that have changed the
number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders
and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential
equity shares.

U. CASH AN D CASH EQUIVALENTS:

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments
with an original maturity of three months or less.

V. MEASUREMENT OF EBIDTA:

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the Company has elected to present
earnings before interest, tax, depreciation and amortization (EBITDA) as a separate line item on the face of the Statement of Profit
& Loss. The Company measures EBITDA on the basis of profit/(loss) from continuing operations. In its measurement, the Company
does not include depreciation and amortization expenses, finance costs and tax expenses.
W. OPERATING LEASES:

Payment and receipts of lease rentals are charged or credited to the Statement of Profit & Loss on straight line basis over the
period of lease.

X. PROPOSED DIVIDEND:

Dividend recommended by the Board of Directors is provided for in the accounts, pending approval at the Annual General Meeting.


Mar 31, 2015

1. Significant Accounting Policies:

A. BASIS OF ACCOUNTING:

The financial statements of Company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the Accounting Standards notified under section 133 of Companies Act 2013, read together with Rule 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

B. USE OF ESTIMATES:

Preparation of financial statements are in conformity with the generally accepted accounting principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period.

Difference between the actual result and estimates, are recognized in the period in which the results are known/materialized.

C. CURRENT / NON-CURRENT CLASSIFICATION:

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 to the Companies Act, 2013. Based on the nature of the products and the time between the acquisition of assets or inventories for processing and their realization in cash and cash equivalents, the company has ascertained its normal operating cycle as twelve months for the purpose of current / non-current classification of assets and liabilities.

D. NON CURRENT ASSETS

D1.TANGIBLE AND INTANGIBLE FIXED ASSETS & DEPRECIATION:

i) Fixed assets except Freehold Land are stated at cost of acquisition & installation, net of CENVAT and VAT credits availed if any, less accumulated depreciation and impairment loss, if any. The cost of fixed assets comprises of its purchase price, import duties and any directly attributable cost of bringing the asset to its working condition for its intended use. Expenses directly attributable to new manufacturing facilities during its construction period are capitalized. Profit or Loss on disposal of tangible assets is recognized in the Statement of Profit and Loss.

Tangible assets not ready for the intended use on the date of Balance Sheet are disclosed as Capital Work in Progress. Advances given towards acquisition of fixed assets outstanding at each Balance Sheet date are disclosed as Capital Advances under Non-Current Loans and Advances.

ii) Borrowing costs incurred during the period of construction/acquisition of assets is added to the cost of Fixed Assets. Major expenses on modification /alterations increasing efficiency/capacity of the qualifying fixed assets are also capitalized.

iii) a) Hitherto depreciation on fixed assets was provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV of the Companies Act 1956, (as amended). Consequent to the enactment of the Companies Act, 2013 (The Act) and its applicability for accounting periods commencing after 01-04-2014, the company reviewed its policy of providing depreciation with reference to the estimated useful lives of Fixed Assets as prescribed by Schedule II of the Act.

In respect of Power Plant, the Company based on technical evaluation, identified the assets and components and reassessed the remaining useful lives of tangible fixed assets and reworked the depreciation accordingly. Further, the company evaluated the useful life of certain components of Plant and Machinery, the impact of which is not material.

Assets costing ' 5,000 or less are fully depreciated in the year of purchase.

Leasehold land and Leasehold improvements are amortized over a period of lease.

b) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications as prescribed under Schedule II. Useful life of components of Plant and Machinery are identified and evaluated for providing depreciation.

iv) IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

v) INTANGIBLE FIXED ASSETS

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition intangible assets are carried at cost less accumulated amortization and accumulated impairment loss, if any. Intangible assets are amortized on straight line basis over the useful life of the asset not exceeding ten years.

D2. INVESTMENTS:

Investments are classified into current and non-current investments. Non-current investments are carried at cost. A provision for diminution in value of non-current investments is made for each investment individually, if such decline is other than temporary. Current investments are stated at the lower of cost and fair value, computed category-wise.

E. INVENTORIES: Inventories are valued as under:

i) RAW MATERIALS, PACKING Valued at lower of cost or net realizable value and for this purpose cost is determined

MATERIALS AND STORES & SPARES on weighted average basis. Due provision for obsolescence is made.

ii) FINISHED GOODS & At cost or net realizable value, whichever is lower. Cost is determined on absorption

WORK IN PROGRESS basis. Due provision for obsolescence is made.

iii) BY- PRODUCTS At net realizable value

F. TRADE RECEIVABLES AND LOANS AND ADVANCES

Trade Receivables and Loans and Advances are stated after making adequate provisions for doubtful balances.

G. REVENUE RECOGNITION:

i) SALES:

a) Revenue is recognized when it is reliably measured and no significant uncertainty exists as to its realization or collection. Revenue from sale of goods is recognized on delivery of the products, when all significant contractual obligations have been satisfied , the property in the goods is transferred for a price , significant risks and rewards of ownership are transferred to the customers and no effective ownership is retained.

b) Sales (net off trade and cash discounts) is inclusive of excise, but excludes export incentives/licenses, VAT/sales tax.

c) Excise duty paid for captive consumption of goods, where CENVAT credit is not available, is shown as excise expense.

ii) EXPORT BENEFITS/INCENTIVES:

The benefits are accounted on the accrual basis.

iii) DIVIDEND INCOME:

Dividend income from Investment is accounted for when the right to receive is established.

iv) INTEREST INCOME:

Interest income is recognized on the time proportion basis.

H. EMPLOYEE BENEFITS:

i) Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

ii) Post-Employment Benefits:

a) Defined Contribution Plans:

State governed provident fund scheme and employees state insurance scheme are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employees renders the related services.

b) Defined Benefit Plans:

The employee's gratuity fund scheme and compensated absences is Company's defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Profit and Loss account.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognise the obligation on net basis.

Gains or losses on the curtailment or settlement of any defined benefits plans are recognised when the curtailment or settlement occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become vested.

iii) Long term employee benefits:

The obligation for long term employee benefits such as long term compensated absences, is recognised in the same manner as in case of defined benefit plans as mentioned in b) (ii) above.

I. BORROWING COSTS:

Borrowing cost includes interest, bank charges, amortization of ancillary costs incurred in connection with arrangements of borrowing. Borrowing costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalised as part of cost of such assets till the activities necessary for its intended use are complete. General borrowing costs are capitalised at the weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in statement of Profit & Loss of the year in which incurred.

J. TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty that sufficient future taxable income will be available against which such assets can be realised. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each Balance Sheet date to reassess realisation.

Deferred tax in respect of timing differences which reverse during the tax holiday period are not recognised. However, Deferred tax in respect of timing differences which reverse after the tax holiday period are recognised in the year in which the timing differences originate.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only for the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognized amounts and there is an intention to settle the asset and liability on a net basis.

K. FOREIGN CURRENCY TRANSACTIONS:

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated in foreign currency at the year end are translated at the exchange rates prevailing at the Balance Sheet date.

iii) Premium or discount arising at the inception of the forward exchange contract is amortised as income or expense over the period of the contract. Any profit or loss arising in renewal or cancellation of forward exchange contracts is recognised as income or expense during the year.

iv) The Company accounts for exchange differences arising on translation/ settlement of foreign currency monetary items as below.

a) Exchange differences arising on long term foreign currency monetary items related to acquisition of fixed assets are capitalized or decapitalized from the cost of assets and are depreciated over the remaining useful life of the assets.

b) Exchange differences arising on other long term foreign currency items are accumulated in the "Foreign Currency Monetary Item Translation Difference Account" and amortized over the remaining life of the concerned monetary item.

c) All other exchange differences are recognized as income or expenses in the period in which they arise.

For the purpose of (a) and (b) referred above , the Company treats a foreign monetary item as " Long term Foreign Currency Monetary Item", if it has a term of 12 months or more at the date of origination.

L. DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING:

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the Accounting Standard (AS 30) on 'Financial Instruments - Recognition and Measurement'. Changes in the fair value of the contracts that are designated and effective as cash flow hedge is directly recorded in the Hedge Reserve Account and is recognized in the Statement of Profit and Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses on the ineffective transactions are recognized immediately in the Profit and Loss Account. The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense / income over the life of the contract.

M. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions are recognised when the company has present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

Contingent Liabilities are disclosed by way of notes to financial statements. Contingent Assets are neither recognised nor disclosed in the financial statements. Provisions and contingent liabilities are reviewed at each Balance Sheet date.

N. CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE:

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the Company are considered for preparing the financial statements.

O. RESEARCH AND DEVELOPMENT EXPENSES:

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged to Profit and Loss Account of the period in which they are incurred.

P. GOVERNMENT GRANTS:-

i) The grants/subsidies received in the nature of promoters' contribution are treated as capital receipts and credited to Capital Reserve.

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value.

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to 'Other Income' in Profit and Loss Account.

Q. EXCISE DUTY:

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim. The Cenvat claim for Excise paid on capital goods is accounted when the claim is allowed.

R. SEGMENT REPORTING:

i) Identification of segments

The company's operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The analysis of geographical segments is based on the areas in which major operating divisions of the company operate.

ii) Inter-segment transfers

The company generally accounts for intersegment sales and transfers at cost plus appropriate margins.

iii) Allocation of common costs

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

iv) Unallocated items

Unallocated items include general corporate income and expense items which are not allocated to any business segment.

v) Segment accounting policies

The company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the company as a whole.

S. EARNINGS PER SHARE:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share spilt, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

T. CASH AND CASH EQUIVALENTS:

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

U. MEASUREMENT OF EBIDTA:

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the company has elected to present earnings before interest, tax, depreciation and amortization (EBITDA) as a separate line item on the face of the statement of profit and loss. The company measures EBITDA on the basis of profit/(loss) from continuing operations. In its measurement, the company does not include depreciation and amortization expenses, finance costs and tax expenses.

V. OPERATING LEASES:

Payment and receipts of lease rentals are charged or credited to the Statement of Profit and Loss on straight line basis over the period of lease.

W. PROPOSED DIVIDEND:

Dividend recommended by the Board of Directors is provided for in the accounts, pending approval at the Annual General Meeting.


Mar 31, 2014

A) BASIS OF ACCOUNTING:

The finnrcul atalamema have been prepared In accordance with the aecountstg pnntdptas generally stcapiao n India (Indian GAAP) and comply with the Companies (Accounting Standards) Rules. 2306 issued by 1ha GentrtJ Government and relevant pravisjona Of COmpaniaS Act, ] 356 and era baaed On the hislG- ca I coal convention.

B) USE ESTIMATES:

Preperation gl flrandal statements m oontormlty with ihe generally accapted aocounting pnndpias require management In make ealmatm sod assumptions that sited the reported imexrot* of tt«els end llabtfll** on th* dab* otthotinsnoisl slstemenl* and the roportod amount of revenues end oipense* during the reporting period Dtiferance between the actual result end estimstoe. are recongnised in the period In Which the results are knowimateriallsed..

C) FIXED ASSETS, DEFUECIATIONANDEXPENDITURE DURINGCONSTRUCTIONPERIOD:

TANGIBLE FIXED ASSETS

i) Fixed assets Lend ere stated the cost or acquisition imswoljon, net oTeenvat and VAT credits avtUedlfiny, lets «ojmui.med depredation end impairment lose, rf any

ii) Borrowing cost incurred during the period of constuction acquired of assets is added to the nasi of Fixed Assets. Major empansaa cm modification feltarationB increasing elfidency,fespMilyorf1he qualifying fixed Besets are also capitalised.

Depreciation on fixed assets is provided on Street Line Method at the rales and fn the manner preecritjad in Schedule XIV of Ihe Compenies Act 1956.

b) In respect of major altoratiOnsImOdificStjofls forming an integral part of existing assets, depredation is provided at the rale arrived Oh the basis d useful hfe of such assets alter such olterationsrmodiikelions or at (he rsle prescribed under Schedule XPV, whichever is hgheron the total value ofauch assets

IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at ear* Balance Sheeldaia 'nr any ingestion of impairment based on in! emci.'extamc factors An impenitent loss ig recognised wherever Ihe carrying amount of feed assets euncaeds its recoverable amoenLTha recoverable amount is measured as the higher of the net sailing price and iho value in use deiermined by the prosenl value pi estimated future cash flows

INTANGIBLE FIXED ASSETS

Intangible assets acquired separately ere measured on miuel recognition ai cost. Fqllowmg Initial recognition Intsng Me assets are carried at cast less accumulated amortization and Bccumulalad Impairment loes, iFany. Intangible assets are amtxlKBd on straight!™ basis over It* usafal life of Ihe asaal not exceeding ten years.

E) INVESTMENTS:

Investments are classified into current and long term investments. Long torm Investments ore canted el. cost. A provision lor dtinnution value of long norm Investments Is mode far each mveglmenl Individually, If such rjedlne is Other than lemponav. Current Investments the lower of COM end fOr value, com puled categmy-wlee

E) INVENTORIES:

Inventdrioa are valued ae under

l) RAW MATERIALS, PACKING

valued at lower of Cost or nor realized value and for this purpose

MATERIALS AND STORES & SPARES.

cost fo determined on welflhied average Weis Due provision for obsolescence is made.

It) FINISHED GOODS & WORK IN PROGRESS

At cost or net realisable value , whichever Is lower Cost is determined on absorption basis. Due prevision for obsoiescene is made,

iii) BY-PRODUCTS

At net reahsabie value

F) REVENUE RECOGNITION:

I) SALES

o) Revenue N recogmod when H is roimbty measured no signlfitnnl uncertainty exlsto as to its roiHiflten or collection.

Ravened from sale of goods H recognized on delivery of Ihe pod nets, when ai significant contractual obligations haw been satisfied. Ihe property In Die goods is transferred lora price, sijpilficarit risks and rewards of ownership ere transferred In the customers end no effective ownership is retained, b) Salas ffret off trade and Cash discounts) Is i ndusive of excise. butlxdirdas errort incenliveai'icenses, VAT/salos Lar

e) Excise duty pa id far captive consumption ol goods, where estival credit is not available, is shown as excise axpans*.

II) DIVIDEND INCOME:

Dividend Income from Investment Is acwunled far when Ihe right to recede Is established Hi) EXPORT BENEFITS!INCENTIVES:

The benefits Me accounted on the accrual basis.

G) EMPLOYEE BENEFITS:

a) Short term Employee Benefits:

All emplane benefits peyabla wholly with i twelve months Of rendering the service era classified ea short term employee benefits. .Benefits autih as salaries, wages, short tarm compensated absences etc,. and the avpeded COM of bonus, e xgrata are jecogateed in the period In which me am ptoyee renders the rata ted service

b) Post-Emptoymen Benefits:

(i) Defined Contribution Plana:

Stole governed provident fund scheme and employees state insurance sdwrna era defied contiibubon plana The contributor, paid I payable under 1he schemee is recoffiised thxing Ihe period ii which the employeea cendeia Ihe celaladeervioes.

(i) Defined BofientFiflfls:

The employee's gratuity fand sefteme and oompertsaied awencei is Company's daitned benolri plans.

The present value of the oMgation isvder such defined benefit plan is detiarmlnsd based on actuarial valuation use the Projatitod Unit Cred-1 MalixxJ, which raoogniws each pertodof service m giving nse to add rionsi unit of employee benefits entitle mem and meesuras esch tail separately to build up me firm oOHgmion. The obligation la measured at the present value of tile estimated ftAan cash flows. The dfcoourit ratos used far datormlnbtg ihe present value af the oHigaliOn under defined benefit plans, is based on ihe market yields on Government Securities ea at the Balance Shea! data, having maturity periode approximating bothotanr* of related Dbfigabiona.

Actuenei gains and teases are recognised toanedlalely m ihe Profit and Loss account.

In case rffundedpfera.ihe tor veXieoMhe plan assea isrediicad tram die grass otigslionB under the defined Penefii plane, to mooguBa Via obigelkm on net bams. Gains of tosses on the curtailment« seLtlmikKiL of any defined, benefits plans are recognised when Ihe curtaiunem of seitiemenl occurs Past service cost is recognised as expense on a straight-lire basts over the average period until *e benefits become veiled, ri) Long men employee benefits:

(c) Long term nmpioyoo benefits such as long tomt ttomperiMted absences, is recipent In thasaron manner as m Case of defend benefit plans aamentioned Inb)(l)above.

H) BORROWING COSTS-

Borrowing coat mdudes mtaresl, bank chargas, eiHntization of andBary coals incurred in corviacbon with anangamartls of bomwlng. Borrowing coats whether tpecific or general, uhfiznd far acquisition, construction nr production of qualifying assets arocapriaesedaspartof ooetof auch assets till the actnritiea necessary tor its Intendad use bib nomplala. General oo mowing costa arecapital aed be Bib weyited average af such bcrran- .a outstanding during [he year. A3 uthar banmdng amis are charged in statement o' Pro'll S Loss 01 1to veer in Which incurred

I) TAXES ON INCOME:

Current tax la delenmiriad aa the emosnt of tin payatie m reaped of taxable income ft* the year. Deferred reoogniaed. on iming difference, being tho difference between taxable income and mounting income lhel originate in one period end are capable of reutreal hone or mors subsequent periods Where there ie unebeoitted depredation « cany forward losses, deferreo tax awala wo recognised only If there » virtual certainty that sufficient future tumble Income wit be Hvgitatie against Whtit wto weetecen be realised Other deferred IB aseeh are recognised only to thB extent them is reasonable certainty of realisation El future. Sudi asaaia are reviewed at each Balance Sheet dale Id reassoES realisation.

Deferred Tax m reaped of tiling d iterances wittil mnae dining hfl to iriday panod are not rrogniisd. However Mb rad tax m imped of tiling dilirei when rave ms after he to hn'day period ere recognised h he year n wnkh Ihe It irjngdiffEtitnces cremate

Mnimum Tax(MAT] paid m a year ia charged in lbs Sslemenl of proti and bes as nnren: lax The rampan) reccgimaa HAT mdf atarahla as an asset only for Bva Extent 1/al there is convincing ovdercs dial the nxryiery w€ pay noimal heema to during tie ipedSad perioc le., the period hr wfiidi MAT erect is slnmri 6 be earned toward In Ihs yes: in toidi the company recap™ MAT aedt m to asnf n secontanoe wdh the Guidance ftots on Aapunhng far CtoS Avariahle si imped of UrtlmtEii AJOsmalrre Tax inter tie Income-tax Ad, 1551, He said asset I) imati by wvtff fledft the of pnjfirindkss J shown as HIXT Quit Eltdeme if The oynpany rwrisws Ihe *MAT tm* BiiBttonerr user d be reponhg dale end mtto down mael tope Eden the rarpany doss nd haw (mine ng evtOanos Jidltwilpsyromisl taxdL-ing theapedled ptooO.

J) F0REIGH CURRENCY TRANSACTIONS :

i) Transactions danominihd hregn os nances araitomtally reavdecat Its exchange rati prevailng stthe tree on the transaction.

ii) Moneastytanti denominated In nmneyai the year end erotenslatid gt The embargo rates nevai.rg at the Balance Stwetcati

iii) Pteitipn or dseotitl artsngat the timUgn of thetonmd etdtange contred a area rased as rtocme or expense Oto the period of the retold. Any pgflt or b«S tiTing h rat™ or csitotocn of IrwaicmuStango conIreels a reoog^sed as inane oratpensa Biting he tear

iv) The Company accounts lor Euhangedirerircm anungootoiutoif Htllwre-il fcmiiri niitooy itvebry tons m Oetor.

a) Ex rfrangaddietwiM anting on long tom bmi tijptoCyiitinMjy law ratted to icqu When of food Eateti ciodie(l or ttoaeiU ati ton ho nx t/ assHs and nre eoDmcalad over ha lEitttoiing utori Hi ot feasants

b) Extfiftngd ditTcfweos Wittog or. oditr tog tout tuTtoSy l»m are aKuiratelod In the 'Ecmlgr ditoiey MOnobtry l»tn TrwiSWxVi D B6w.fi) ACtcurl" and amonllod iwneewy lie of ho co neared mtiiyrtto


Mar 31, 2013

A) BASIS OF ACCOUNTING:

The financial statements have been prepared in accordance with the accounting principles generally accepted in India (Indian GAAP) and comply with the Companies (Accounting Standards) Rules, 2006 issued by the Central Government and relevant provisions of Companies Act,1956 and are based on the historical cost convention.

B) USE OF ESTIMATES:

Preparation of financial statements in conformity with the generally accepted accounting principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates, are recognised in the period in which the results are known/materialised. C ) FIXED ASSETS, DEPRECIATION AND EXPENDITURE DURING CONSTRUCTION PERIOD: TANGIBLE FIXED ASSETS i) Fixed assets except Freehold Land are stated at cost of acquisition & installation, net of cenvat and VAT credits availed , if any, less accumulated depreciation and impairment loss, if any.

ii) Borrowing costs incurred during the period of Construction/acquisition of assets is added to the cost of Fixed Assets. Major expenses on modification /alterations increasing efficiency/capacity of the qualifying fixed assets are also capitalised. iii) a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed inSchedule XIV of the Companies Act 1956, (as amended). b) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications or at the rate prescribed under Schedule

XIV, whichever is higher on the total value of such assets.

iv)IMPAIRMENT OF ASSETS The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/external factors. An impairment loss is recognised wherever the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

INTANGIBLE FIXED ASSETS

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition intangible assets are carried at cost less accumulated amortization and accumulated impairment loss, if any. Intangible assets are amortized on straightline basis over the useful life of the asset not exceeding ten years.

D) INVESTMENTS:

Investments are classified into current and long term investments. Long term investments are carried at cost. A provision for diminution in value of long term investments is made for each investment individually, if such decline is other than temporary. Current investments are stated at the lower of cost and fair value, computed category-wise.

E) INVENTORIES: Inventories are valued as under:

i) RAW MATERIALS, PACKING Valued at lower of cost or net realizable value and for this purpose

MATERIALS AND STORES& SPARES. cost is determined on weighted average basis. Due provision for obsolescence is made.

ii) FINISHED GOODS & WORK IN At cost or net realisable value, whichever is lower. Cost is

PROGRESS determined on absorption basis. Due provision for obsolescence is made.

iii) BY-PRODUCTS At net realisable value

F) REVENUE RECOGNITION: i) SALES:

a) Revenue is recognized when it is reliably measured and no significant uncertainty exists as to its realization or collection.

Revenue from sale of goods is recognized on delivery of the products, when all significant contractual obligations have been satisfied , the property in the goods is transferred for a price , significant risks and rewards of ownership are transferred to the customers and no effective ownership is retained.

b) Sales (net off trade and cash discounts) is inclusive of excise, but excludes export incentives/licenses, VAT/sales tax.

c) Excise duty paid for captive consumption of goods, where cenvat credit is not available, is shown as excise expense. ii) DIVIDEND INCOME:

Dividend income from Investment is accounted for when the right to receive is established. iii) EXPORT BENEFITS/INCENTIVES:

The benefits are accounted on the accrual basis.

G) EMPLOYEE BENEFITS:

a) Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

b) Post-Employment Benefits: (i) Defined Contribution Plans:

State governed provident fund scheme and employees state insurance scheme are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employees renders the related services. (ii) Defined Benefit Plans:

The employee’s gratuity fund scheme and compensated absences is Company’s defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Profit and Loss account. In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognise the obligation on net basis. Gains or losses on the curtailment or settlement of any defined benefits plans are recognised when the curtailment or settlement occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become vested.

c) Long term employee benefits:

The obligation for long term employee benefits such as long term compensated absences, is recognised in the same manner as in case of defined benefit plans as mentioned

in b) (ii) above. H) BORROWING COSTS:

Borrowing cost includes interest, bank charges, amortization of ancillary costs incurred in connection with arrangements of borrowing. Borrowing costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalised as part of cost of such assets till the activities necessary for its intended use are complete. General borrowing

costs are capitalised at the weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in statement of Profit & Loss of the year in which incurred.

I) TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty that sufficient future taxable income will be available against which such assets can be realised. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each Balance Sheet date to reassess realisation. Deferred tax in respect of timing differences which reverse during the tax holiday period are not recognised. However Deferred tax in respect of timing differences which reverse after the tax holiday period are recognised in the year in which the timing differences originate.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only for the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

J) FOREIGN CURRENCY TRANSACTIONS:

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated in foreign currency at the year end are translated at the exchange rates prevailing at the Balance Sheet date.

iii) Premium or discount arising at the inception of the forward exchange contract is amortised as income or expense over the period of the contract. Any profit or loss arising in renewal

or cancellation of forward exchange contracts is recognised as income or expense during the year. iv) The Company accounts for exchange differences arising on translation/ settlement of foreign currency monetary items as below.

a) Exchange differences arising on long term foreign currency monetary items related to acquisition of fixed assets are capitalized or decapitalized from the cost of assets and are depreciated over the remaining useful life of the assets.

b) Exchange differences arising on other long term foreign currency items are accumulated in the "Foreign Currency Monetary Item Translation Difference Account" and amortized over the remaining life of the concerned monetary item.

c) All other exchange differences are recognized as income or expenses in the period in which they arise.

For the purpose of (a) and (b) referred above , the Company treats a foreign monetary item as " Long term Foreign Currency Monetary Item", if it has a term of 12 months or more at the date of origination.

K) DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING:

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the Accounting Standard (AS 30) on ‘Financial Instruments – Recognition and Measurement’. Changes in the fair value of the contracts that are designated and effective as cash flow hedge is directly recorded in the Hedge Reserve Account and is recognized in the Statement of Profit and Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses on the ineffective transactions are recognized immediately in the Profit and Loss Account.

L) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions are recognised when the company has present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will

be required to settle the obligation and a reliable estimate can be ade for the amount of the obligation. Contingent Liabilities are disclosed by way of notes to financial statements. Contingent Assets are neither recognised nor disclosed in the financial statements. Provisions and contingent liabilities are reviewed at each Balance Sheet date. M) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE:

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the Company are considered for preparing the financial

statements. N) RESEARCH AND DEVELOPMENT EXPENSES:

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged to Profit and Loss Account of the period in which

they are incurred. O) GOVERNMENT GRANTS:- i) The grants/subsidies received in the nature of promoters’ contribution are treated as capital receipts and credited to Capital Reserve.

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value.

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to ‘Other Income’ in Profit and Loss Account. P) EXCISE DUTY:

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim. The Cenvat claim

for Excise paid on capital goods is accounted when the claim is allowed. Q) SEGMENT REPORTING:

i) Identification of segments

The company’s operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The analysis of geographical segments is based on the areas in which major operating divisions of the company operate.

ii) Inter-segment transfers

The company generally accounts for intersegment sales and transfers at cost plus appropriate margins.

iii) Allocation of common costs

Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

iv) Unallocated items

Unallocated items include general corporate income and expense items which are not allocated to any business segment.

v) Segment accounting policies

The company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the company as a whole. R) EARNINGS PER SHARE:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share spilt, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares. S) CASH AND CASH EQUIVALENTS: Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

T) MEASUREMENT OF EBIDTA:

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the company has elected to present earnings before interest, tax, depreciation and amortization

(EBITDA) as a separate line item on the face of the statement of profit and loss. The company measures EBITDA on the basis of profit/(loss) from continuing operations. In its measurement, the company does not include depreciation and amortization expenses, finance costs and tax expenses.


Mar 31, 2012

A) ACCOUNTING CONVENTION:

The financial statements have been prepared in accordance with the accounting principles generally accepted in India (Indian GAAP) and comply with the Companies (Accounting Standards) Rules,2006 issued by the Central Government and relevant provisions of Companies Act, 1956 and are based on the historical cost convention.

B) USE OF ESTIMATES:

Preparation of financial statements in conformity with the generally accepted accounting principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates, are recognised in the period in which the results are known/materialised.

C) REVENUE RECOGNITION:

i) SALES:

a) Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection. Revenue from sale of goods is recognized on delivery of the products, when all significant contractual obligations have been satisfied , the property in the goods is transferred for a price , significant risks and rewards of ownership are transferred to the customers and no effective ownership is retained.

b) Sales is inclusive of excise, and exclusive of export incentives/licenses, profit or loss on forward exchange contracts on sales and VAT/central sales tax and trade and cash discount.

c) Excise duty paid for captive consumption of goods, where cenvat credit is not available, is shown as excise expense.

ii) DIVIDEND INCOME:

Dividend income from Investment is accounted for when the right to receive is established.

iii) EXPORT BENEFITS/INCENTIVES:

The benefits are accounted on the accrual basis.

D) FIXED ASSETS, DEPRECIATION AND EXPENDITURE DURING CONSTRUCTION PERIOD:

i) Fixed assets are stated at cost of acquisition & installation, net of cenvat and VAT credits availed ,if any, less accumulated depreciation and impairment loss, if any. Borrowing costs incurred during the period of Construction/acquisition of assets is added to the cost of Fixed Assets. Major expenses on modification / alterations increasing efficiency/capacity of the plant are also capitalised.

ii) a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV of the Companies Act 1956, (as amended).

b) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications or at the rate prescribed under Schedule XIV, whichever is higher on the total value of such assets.

iii) IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/external factors. An impairment loss is recognised wherever the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

E) INVESTMENTS:

Investments are classified into current and long term investments. Long term investments are carried at cost. A provision for diminution in value of long term investments is made for each investment individually, if such decline is other than temporary. Current investments are stated at the lower of cost and fair value, computed category-wise.

F) INVENTORIES:

Inventories are valued as under:

i) RAW MATERIALS, PACKING Valued at lower of cost or net realizable value and for this purpose cost is MATERIALS AND STORES& SPARES. determined on weighted average basis. Due provision for obsolescence is made.

ii) FINISHED GOODS & WORK IN At cost or net realisable value, whichever is lower. Cost is PROGRESS determined on absorption basis. Due provision for obsolescence is made.

iii) BY PRODUCTS At net realisable value

G) EMPLOYEE BENEFITS:

a) Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

b) Post-Employment Benefits:

(i) Defined Contribution Plans:

State governed provident fund scheme and employees state insurance scheme are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employees renders the related services.

(ii) Defined Benefit Plans:

The employee's gratuity fund scheme and compensated absences is Company's defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations. Actuarial gains and losses are recognised immediately in the Profit and Loss account.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognise the obligation on net basis. Gains or losses on the curtailment or settlement of any defined benefits plans are recognised when the curtailment or settlement occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become vested.

c) Long term employee benefits:

The obligation for long term employee benefits such as long term compensated absences, is recognised in the same manner as in case of defined benefit plans as mentioned in b) (ii) above.

H) BORROWING COSTS:

Borrowing costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalised as part of cost of such assets till the activities necessary for its intended use are complete. General borrowing costs are capitalised at the weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in statement of Profit & Loss of the year in which incurred.

I) TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty that sufficient future taxable income will be available against which such assets can be realised. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each Balance Sheet date to reassess realisation.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only for the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

J) FOREIGN CURRENCY TRANSACTIONS:

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated in foreign currency at the year end are translated at the exchange rates prevailing at the Balance Sheet date.

iii) Premium or discount arising at the inception of the forward exchange contract is amortised as income or expense over the period of the contract. Any profit or loss arising in renewal or cancellation of forward exchange contracts is recognised as income or expense during the year.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss Account.

v) As per the notification issued by Ministry of Corporate Affairs on 29-12-2011 relating to "The Effects of Changes in Foreign Exchange Rates", paragraph 46A of Accounting standard 11, namely, in respect of accounting periods commencing on or after the 1st April, 2011, the Company which had earlier exercised the option under paragraph 46 and such option to be irrevocable and to be applied to all such foreign currency monetary items, the exchange differences arising on reporting of long-term foreign currency monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, is added to or deducted from the cost of the asset and shall be depreciated over the balance life of the asset, and in other cases, is accumulated in a "Foreign Currency Monetary Item Translation Difference Account" in the financial statements and amortized over the balance period of such long term asset or liability, by recognition as income or expense in each of such periods, with the exception of exchange differences dealt with in accordance with the provisions of paragraph 15 of the said rules. This policy will be applicable till 31-03-2020.

K) DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING:

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the Accounting Standard (AS 30) on 'Financial Instruments - Recognition and Measurement'. Changes in the fair value of the contracts that are designated and effective as cash flow hedge is directly recorded in the Hedge Reserve Account and is recognized in the Statement of Profit and Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses on the ineffective transactions are recognized immediately in the Profit and Loss Account.

L) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions are recognised when the company has present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

Contingent Liabilities are disclosed by way of notes to financial statements. Contingent Assets are neither recognised nor disclosed in the financial statements. Provisions and contingent liabilities are reviewed at each Balance Sheet date.

M) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE:

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the Company are considered for preparing the financial statements.

N) RESEARCH AND DEVELOPMENT EXPENSES:

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged to Profit and Loss Account of the period in which they are incurred.

O) GOVERNMENT GRANTS:-

i) The grants/subsidies received in the nature of promoters' contribution are treated as capital receipts and credited to Capital Reserve.

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value.

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to 'Other Income' in Profit and Loss Account.

P) EXCISE DUTY:

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim. The Cenvat claim for Excise paid on capital goods is accounted when the claim is allowed.

Q) SEGMENT REPORTING:

i) Identification of segments - The company's operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The analysis of geographical segments is based on the areas in which major operating divisions of the company operate.

ii) Inter-segment transfers - The company generally accounts for intersegment sales and transfers at cost plus appropriate margins.

iii) Allocation of common costs - Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

iv) Unallocated items - Unallocated items include general corporate income and expense items which are not allocated to any business segment.

v) Segment accounting policies - The company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the company as a whole.

R) EARNINGS PER SHARE:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes, if any) by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share spilt, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

S) CASH AND CASH EQUIVALENTS:

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

T) MEASUREMENT OF EBIDTA:

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the company has elected to present earnings before interest, tax, depreciation and amortization (EBITDA) as a separate line item on the face of the statement of profit and loss. The company measures EBITDA on the basis of profit/(loss) from continuing operations. In its measurement, the company does not include depreciation and amortization expenses, finance costs and tax expenses.


Mar 31, 2011

A) ACCOUNTING CONVENTION

The financial statements have been prepared in accordance with the accounting principles generally accepted in India (Indian GAAP) and comply with the Companies (Accounting Standards) Rules,2006 issued by the Central Government and relevant provisions of Companies Act,1956 and are based on the historical cost convention.

B) USE OF ESTIMATES

Preparation of financial statements in conformity with the generally accepted accounting principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates, are recognised in the period in which the results are known/materialised.

C) REVENUE RECOGNITION

i) SALES

a) Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection. Revenue from sale of goods is recognized on delivery of the products, when all significant contractual obligations have been satisfied , the property in the goods is transferred for a price , significant risks and rewards of ownership are transferred to the customers and no effective ownership is retained.

b) Sales is inclusive of excise, export incentives/licenses, profit or loss on forward exchange contracts on sales and exclusive of VAT/ sales tax and trade discount.

c) Excise duty paid for captive consumption of goods, where cenvat credit is not available, is shown as excise expense.

ii) DIVIDEND INCOME

Dividend income from Investment is accounted for when the right to receive is established. iii) EXPORT BENEFITS/INCENTIVES

The benefits are accounted on the accrual basis.

D) FIXED ASSETS, DEPRECIATION AND EXPENDITURE DURING CONSTRUCTION PERIOD

i) Fixed assets are stated at cost of acquisition & installation, net of cenvat and VAT credits availed, if any, less accumulated depreciation and impairment loss, if any. Borrowing costs incurred during the period of Construction/acquisition of assets is added to the cost of Fixed Assets. Major expenses on modification /alterations increasing efficiency/capacity of the plant are also capitalised.

ii) a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV of the Companies Act 1956, (as amended).

b) Incremental cost arising on account of translation of foreign currency liabilities up to 31.03.2007 for acquisition of fixed assets, depreciation has been provided over the residual life of the respective assets.

c) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications or at the rate prescribed under Schedule XIV, whichever is higher on the total value of such assets.

iii) Impairment of Assets

The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/external factors. An impairment loss is recognised wherever the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

E) INVESTMENTS

Investments are classified into current and long term investments. Long term investments are carried at cost. A provision for diminution in value of long term investments is made for each investment individually, if such decline is other than temporary. Current investments are stated at the lower of cost and fair value , computed categorywise.

F) INVENTORIES

Inventories are valued as under:

i) RAW MATERIALS, PACKING

MATERIALS AND STORES& SPARES.

Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis. Due provision for obsolescence is made.

ii) FINISHED GOODS & WORK IN PROGRESS

At cost or net realisable value, whichever is lower. Cost is determined on absorption basis. Due provision for obsolescence is made.

iii) By Products At net realisable value

G) EMPLOYEE BENEFITS

a) Short Term Employee Benefits

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

b) Post-Employment Benefits

(i) Defined Contribution Plans

State governed provident fund scheme and employees state insurance scheme are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employees renders the related services.

(ii) Defined Benefit Plans

The employee's gratuity fund scheme and compensated absences is Company's defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations. Actuarial gains and losses are recognised immediately in the Profit and Loss account.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognise the obligation on net basis.

Gains or losses on the curtailment or settlement of any defined benefits plans are recognised when the curtailment or settlement occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become vested. c) Long term employee benefits

The obligation for long term employee benefits such as long term compensated absences, is recognised in the same manner as in case of defined benefit plans as mentioned in b) (ii) above.

H) BORROWING COSTS

Borrowing costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalised as part of cost of such assets till the activities necessary for its intended use are complete. General borrowing costs are capitalised at the weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in statement of Profit & Loss of the year in which incurred.

I) TAXES ON INCOME

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty that sufficient future taxable income will be available against which such assets can be realised. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each Balance Sheet date to reassess realisation.

J) FOREIGN CURRENCY TRANSACTIONS

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction.

ii) Monetary items denominated in foreign currency at the year end are translated at the exchange rates prevailing at the Balance Sheet date.

iii) Premium or discount arising at the inception of the forward exchange contract is amortised as income or expense over the period of the contract. Any profit or loss arising in renewal or cancellation of forward exchange contracts is recognised as income or expense during the year.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss Account.

K) DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the Accounting Standard (AS 30) on ‘Financial Instruments - Recognition and Measurement'. Changes in the fair value of the contracts that are designated and effective as cashflow hedge is directly recorded in the Hedge Reserve Account and is recognized in the Statement of Profit and Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses on the ineffective transactions are recognized immediately in the Profit and Loss Account.

L) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions are recognised when the company has present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

Contingent Liabilities are disclosed by way of notes to financial statements.

Contingent Assets are neither recognised nor disclosed in the financial statements.

Provisions and contingent liabilities are reviewed at each Balance Sheet date.

M) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the Company are considered for preparing the financial statements.

N) RESEARCH AND DEVELOPMENT EXPENSES

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged to Profit and Loss Account of the period in which they are incurred.

O) GOVERNMENT GRANTS

i) The grants/subsidies received in the nature of promoters' contribution are treated as capital receipts and credited to Capital Reserve.

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value.

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to ‘Other Income' in Profit and Loss Account.

P) EXCISE DUTY

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim. The Cenvat claim for Excise paid on capital goods is accounted when the claim is allowed.


Mar 31, 2010

A) ACCOUNTING CONVENTION:

The financial statements have been prepared in accordance with the accounting principles generally accepted in India (Indian GAAP) and comply with the Companies (Accounting Standards) Rules,2006 issued by the Central Government and relevant provisions of Companies Act,1956 and are based on the historical cost convention.

B) USE OF ESTIMATES:

Preparation of financial statements in conformity with the generally accepted accounting principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period.

Difference between the actual result and estimates, are recognised in the period in which the results are known/materialised.

C) REVENUE RECOGNITION:

i) SALES:

a) Revenue is recognized when it is earned and no significant uncertainty exists as to its realization or collection. Revenue from sale of goods is recognized on delivery of the products, when all significant contractual obligations have been satisfied , the property in the goods is transferred for a price , significant risks and rewards of ownership are transferred to the customers and no effective ownership is retained.

b) Sales is inclusive of excise, export incentives/licenses, profit or loss on forward exchange contracts on sales and exclusive of VAT/ sales tax and trade discount.

c) Excise duty paid for captive consumption of goods, where cenvat credit is not available, is shown as excise expense.

ii) DIVIDEND INCOME:

Dividend income from Investment is accounted for when the right to receive is established.

iii) EXPORT BENEFITS/INCENTIVES:

The benefits are accounted on the accrual basis.

D) FIXED ASSETS, DEPRECIATION AND EXPENDITURE DURING CONSTRUCTION PERIOD:

i) Fixed assets are stated at cost of acquisition & installation, net of cenvat and VAT credits availed ,if any, less accumulated depreciation and impairment loss, if any. Borrowing costs incurred during the period of Construction/acquisition of assets is added to the cost of Fixed Assets. Major expenses on modification /alterations increasing efficiency/capacity of the plant are also capitalised.

ii) a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV of the Companies Act 1956, (as amended).

b) Incremental cost arising on account of translation of foreign currency liabilities up to 31.03.2007 for acquisition of fixed assets, depreciation has been provided over the residual life of the respective assets.

c) In respect of major alterations/modifications forming an integral part of existing assets, depreciation is provided at the rate arrived on the basis of useful life of such assets after such alterations/modifications or at the rate prescribed under Schedule XIV, whichever is higher on the total value of such assets.

iii) IMPAIRMENT OF ASSETS

The carrying amount of assets is reviewed at each Balance Sheet date for any indication of impairment based on internal/external factors. An impairment loss is recognised wherever the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

E) INVESTMENTS:

Investments are classified into current and long term investments. Long term investments are carried at cost. A provision for diminution in value of long term investments is made for each investment individually, if such decline is other than temporary. Current investments are stated at the lower of cost and fair value , computed categorywise.

F) INVENTORIES:

Inventories are valued as under:

i) RAW MATERIALS, PACKING Valued at lower of cost or net realizable value and for this purpose cost is determined

MATERIALS AND STORES& SPARES. on weighted average basis. Due provision for obsolescence is made.

ii) FINISHED GOODS & WORK IN At cost or net realisable value, whichever is lower. Cost is determined on absorption

PROGRESS basis. Due provision for obsolescence is made.

iii) BY PRODUCTS At cost or net realisable value, whichever is lower.

G) EMPLOYEE BENEFITS:

a) Short Term Employee Benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages, short term compensated absences etc., and the expected cost of bonus, ex-gratia are recognised in the period in which the employee renders the related service.

b) Post-Employment Benefits:

(i) Defined Contribution Plans:

State governed provident fund scheme and employees state insurance scheme are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employees renders the related services.

(ii) Defined Benefit Plans:

The employees gratuity fund scheme and compensated absences is Companys defined benefit plans.

The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefits entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government Securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Profit and Loss account.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligations under the defined benefit plans, to recognise the obligation on net basis.

Gains or losses on the curtailment or settlement of any defined benefits plans are recognised when the curtailment or settlement occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become vested.

c) Long term employee benefits :

The obligation for long term employee benefits such as long term compensated absences, is recognised in the same manner as in case of defined benefit plans as mentioned in b) (ii) above.

H) BORROWING COSTS:

Borrowing costs whether specific or general, utilized for acquisition, construction or production of qualifying assets are capitalised as part of cost of such assets till the activities necessary for its intended use are complete. General borrowing costs are capitalised at the weighted average of such borrowings outstanding during the year. All other borrowing costs are charged in statement of Profit & Loss of the year in which incurred.

I) TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty that sufficient future taxable income will be available against which such assets can be realised. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each Balance Sheet date to reassess realisation.

J) FOREIGN CURRENCY TRANSACTIONS:

i) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. ii) Monetary items denominated in foreign currency at the year end are translated at the exchange rates prevailing at the Balance Sheet date. iii) Premium or discount arising at the inception of the forward exchange contract is amortised as income or expense over the period of the contract.

Any profit or loss arising in renewal or cancellation of forward exchange contracts is recognised as income or expense during the year. iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss Account.

K) DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING:

The Company uses foreign currency contracts and currency options to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments for speculative purposes. The Company has applied to such contracts the principles of recognition set out in the Accounting Standard (AS 30) on ‘Financial Instruments – Recognition and Measurement’. Changes in the fair value of the contracts that are designated and effective as hedge is directly recorded in the Hedge Reserve Account and is recognized in the Statement of Profit and Loss in the same period or periods during which the hedged transaction affects profit and loss. Gains or losses on the ineffective transactions are recognized immediately in the Profit and Loss Account.

L) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions are recognised when the company has present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation.

Contingent Liabilities are disclosed by way of notes to financial statements.

Contingent Assets are neither recognised nor disclosed in the financial statements.

Provisions and contingent liabilities are reviewed at each Balance Sheet date.

M) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE:

All contingencies and events occurring after the Balance Sheet date which have a material effect on the financial position of the Company are considered for preparing the financial statements.

N) RESEARCH AND DEVELOPMENT EXPENSES:

Expenditure relating to capital items is debited to Fixed Assets and depreciated at applicable rates. Revenue expenditure is charged to Profit and Loss Account of the period in which they are incurred.

O) GOVERNMENT GRANTS:-

i) The grants/subsidies received in the nature of promoters’ contribution are treated as capital receipts and credited to Capital Reserve.

ii) The grants /subsidies relating to specific fixed assets are shown as deduction from the cost of the respective assets concerned in arriving at its book value.

iii) Grant in the form of revenue subsidy is treated as revenue receipt and credited to ‘Other Income’ in Profit and Loss Account.

P) EXCISE DUTY:

Finished Goods lying at factories have been valued at inclusive of Excise Duty. The claim of Cenvat for Excise Duty paid on inputs is accounted on the basis of claim. The Cenvat claim for Excise paid on capital goods is accounted when the claim is allowed.

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