Accounting Policies of Jayatma Industries Ltd. Company

Mar 31, 2024

Significant Accounting Policies

• Company Overview

JAYATMA INDUSTRIES LIMITED (formerly known as SANTARAM SPINNERS LIMITED) ("the company"), is a
public limited Company incorporated as private limited company in 1983 and subsequently converted to
public limited company in 1994. The company''s shares are listed on Bombay Stock Exchange. The registered
office of the Company is located at 4^th Floor 1, Laxminagar, Co.op Hou. Society, Bs Naranpura Post Office,
Naranpura, Ahmedabad-380013. The company is engaged in manufacturing and trading of cotton - Kapas,
ginning cotton bales, raw oil and its agro by- products and yarn.

• Basis for Preparation of Financial statements

These financial statements have been prepared in accordance with the generally accepted accounting
principles in India, on the basis of going concern under the historical cost convention and also on accrual
basis. These financial statements comply, in all material aspects, with the provisions the Companies Act, 2013
(to the extent applicable) and also accounting standards prescribed by the Companies (Accounting Standards)
Rules, 2006, which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of
General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs.

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating
cycle of less than twelve months, hence a period of twelve months has been considered for bifurcation of
assets and liabilities into current and non-current as required by Schedule III to the Companies Act, 2013 for
preparation of Financial Statements 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

• Use of Estimates

The preparation of financial statements is conformity with generally accepted accounting principles require
management to make assumptions and estimates, which it believes are reasonable under the circumstances
that affect the reported amounts of assets and liabilities on the date of financial statements and the reported
amounts of revenue and expenses during the period. Actual results could differ from those estimates.
Difference between the actual results and estimates are recognized in the period in which the results are
known /materialized.

• Property, Plant and Equipment

Property, plant and equipment are stated at acquisition cost net of tax / duty credit availed, less accumulated
depreciation and accumulated impairment losses, if any. Properties in the course of construction are carried
at cost, less any recognized impairment losses. All costs, including borrowing costs incurred up to the date the
asset is ready for its intended use, is capitalized along with respective asset.

Depreciation is recognized based on the cost of assets less their residual values over their useful lives, using
the straight-line method. The useful life of property, plant and equipment is considered based on life
prescribed in schedule II to the Companies Act, 2013 for year 2023-2024.

• Financial Instruments

Financial assets and financial liabilities are recognized when an entity becomes a party to the contractual
provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the
financial assets or financial liabilities, as appropriate, on initial recognition.

Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value
through profit or loss are recognized immediately in profit or loss.

• Financial Assets

> Classification

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

• Those to be measured subsequently at fair value (either through OCI, or through profit or
loss), and

• Those measured at amortized cost.

• Those measured at carrying cost for equity instruments of subsidiaries, and joint ventures.

> Initial recognition and measurement

All financial assets, are recognized initially at fair value.

• Financial liabilities and equity instruments
Classification as debt or equity

Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangements and the definitions of a financial liability and
an equity instrument.

Equity instruments

The Company subsequently measures all equity investments at fair value. Where the Company''s
management has elected to present fair value gains and losses on equity investments in OCI, there is no
subsequent reclassification of fair value gains and losses to the Standalone Statement of Profit and Loss.
When the financial asset is derecognized, the cumulative gain or loss previously recognised in OCI is
reclassified to equity. Dividends from such investments are recognised in the Standalone Statement of Profit
and Loss within other income when the Company''s right to receive payments is established. Impairment
losses (and reversal of impairment losses) on equity investments measured at FVTOCI are not reported
separately from other changes in fair value.

Financial liabilities

The Company''s financial liabilities comprise borrowings, trade payables and other liabilities.

These are initially measured at fair value, net of transaction costs, and are subsequently measured at
amortized cost using the EIR method. The EIR is a method of calculating the amortized cost of a financial
liability and of allocating interest expense over the relevant period at effective interest rate. The effective
interest rate is the rate that exactly discounts estimated future cash payments through the expected life of
the financial liability, or, where appropriate, a shorter period.

Financial liabilities at amortized cost

Financial liabilities that are not held-for-trading and are not designated as at FVTPL are measured at
amortized cost at the end of subsequent accounting periods. The carrying amounts of financial liabilities that
are subsequently measured at amortized cost are determined based on the effective interest method.
Interest expense that is not capitalized as part of costs of an asset is included in the ''Finance costs'' line item.

Trade and other payables are recognized at the transaction cost, which is its fair value.

• Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value measurement is based on
the presumption that the transaction to sell the financial asset or settle the financial liability takes place
either:

• In the principal market, or

• In the absence of a principal market, in the most advantageous market

The principal or the most advantageous market must be accessible by the Company.

A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate
economic benefits by using the asset in its highest and best use.

• Revenue recognition

The Company has adopted Ind AS 115 from 1st April, 2018 and opted for modified retrospective application
with the cumulative effect of initially applying this standard recognized at the date of initial application. The
standard has been applied to all open contracts as on 1st April, 2018, and subsequent contracts with
customers from that date.

Performance obligation:

The revenue is recognized on fulfilment of performance obligation.

• Sale of products:

The Company earns revenue primarily from sale of cotton and blended yarns.

Payment for the sale is made as per the credit terms in the agreements with the customers. The credit period
is generally short term, thus there is no significant financing component.

The Company''s contracts with customers do not provide for any right to returns, refunds or similar
obligations. The Company''s obligation to repair or replace faulty products under standard warranty terms is
recognized as a provision.

Revenue is recognized when the performance obligations are satisfied and the control of the product is
transferred, being when the goods are delivered as per the relevant terms of the contract at which point in
time the Company has a right to payment for the asset, customer has possession and legal title to the asset,
customer bears significant risk and rewards of ownership and the customer has accepted the asset or the
Company has objective evidence that all criteria for acceptance have been satisfied.

• Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which
are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are
added to the cost of those assets, until such time as the assets are substantially ready for their intended use
or sale. Interest income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

• Taxation

Tax on Income comprises current and deferred tax. It is recognized in statement of profit and loss except to
the extent that it relates to a business combination, or items recognized directly in equity or in other
comprehensive income.

• Current tax

Tax on income for the current period is determined on the basis on estimated taxable income and tax credits
computed in accordance with the provisions of the relevant tax laws and based on the expected outcome of
assessments / appeals. Current income tax assets and liabilities are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount
that are enacted or substantively enacted, at the reporting date. Management periodically evaluates
positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to
interpretation and establishes provisions where appropriate.

• Deferred tax

Deferred tax is recognized for the future tax consequences of deductible temporary differences between the
carrying values of assets and liabilities and their respective tax bases at the reporting date, using the tax rates
and laws that are enacted or substantively enacted as on reporting date. Deferred tax assets are recognized
to the extent that it is probable that future taxable income will be available against which the deductible
temporary differences can be utilized. Deferred tax relating to items recognized outside the statement of
profit and loss is either in other comprehensive income or directly in equity. The carrying amount of deferred
tax assets is reviewed at each reporting date.

• Earnings per share

The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is
calculated by dividing the profit or loss attributable to the ordinary shareholders of the company by the
weighted average number of ordinary shares outstanding during the period. Where ordinary shares are
issued but not fully paid, they are treated in the calculation of basic earnings per share as a fraction of an
ordinary share to the extent that they were entitled to participate in dividends during the period relative to a
fully paid ordinary share. Diluted earnings per share is computed by dividing the net profit after tax by the
weighted average number of equity shares considered for deriving basic EPS and also weighted average
number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.
Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a
later date. Dilutive potential equity shares are determined independently for each period presented.

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Mar 31, 2015

A. Basis of Preparation of Financial Statements

The financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis, except as otherwise stated, to the extent disclosed in the notes on Accounts. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211(3C) [Companies Accounting Standards Rules, 2006, as amended] and the other relevant provisions of the Companies Act, 2013.

B. Use of Estimates

The presentation of financial statements requires that the management makes estimates and assumption that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Although, these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates. Difference between the actual result and estimates are recognized in the period in which the results are known /materialized.

C. Fixed Assets and Depreciation

1. Fixed Assets are stated at cost less accumulated depreciation. All cost, including financing cost till commencement of assets put to use, effect of foreign exchange contracts and adjustment arising from exchange rate variations attributable to the fixed assets are capitalised.

2. Expenditure including finance costs related to borrowed funds for the fixed assets incurred on projects under implementation is included under "Capital Work in Progress". These expenses are transferred to fixed assets on commencement of respective projects.

3. Tangible Assets

(i) Depreciation on Fixed Assets is provided to the extent of depreciable amount on Straight Line Method based on balance useful lives of the Assets as per useful life prescribed in Schedule II to the Companies Act, 2013.

(ii) The carrying amount of the asset, as on date of Schedule II becoming effective, after retaining the residual value, shall be recognised in the opening balance of retained earnings where the remaining useful life of an asset is NIL.

D. Impairment of Assets

The Company tests for impairments at the close of the accounting period if and only if there are indications that suggest a possible reduction in the recoverable value of an asset. If the recoverable value amount of an Asset, i.e the net releasable value or the economic value in use of a cash generating unit, is lower than the carrying amount of the Assets the difference is provided for as impairment. However, if subsequently the position reverses and the recoverable amount become higher than the carrying value the provision to the extent of the then difference is reversed, but not higher than the amount provided for. There was no impairment loss on fixed assets on the basis of review carried out by the management in accordance with Accounting Standard 28 issued by The Institute of Chartered Accountant of India.

E. Investments

Investments that are intended to be held for more than a year, from the date of acquisition, are classified as Long Term Investments. Long Term Investments and Current Investments are carried at cost. Unquoted investments are stated at book value. In case of Non Current Investments, the management is of the opinion to recover its book value and hence provision for diminution in value of investment is not made to recognise a decline in the value of investment. However, the Company do recognize a decline in the value of Current investment and provision for diminution in the value of investment is being made as required.

F. Inventories

Cost of inventories have been computed to include all cost of purchase, cost of conversion and other cost incurred in bringing them to their respective present location and condition.

Raw materials and components, stores and spares are valued at cost. Cost is determined on Moving Average price basis.

G. Employee Retirement Benefits

Short Term Employees Benefits : The undiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employees is recognized during the year when the employee render the services.

Post Employee Benefits : No provision is made for accrued liability for payment leave encashment & gratuity under the Payment of Gratuity Act, 1972. and encashment of leave as the liabilities are not ascertainable. The company will charge the same to the revenue in the year of actual payment.

H. Revenue, Turnover & Expenses Recognition In case of sale of goods:

Revenue is recognizing when the significant risks and rewards of ownership of goods have passed to the buyer, which generally coincides with delivery.

The sales are recorded when supply of goods takes place in accordance with the terms of sale and on change of title in the goods and is net of Central Sales Tax, VAT, Sales return and rate difference.

I. Income & Expenditure

All Income and Expenses to the extent consider payable and receivable respectively, unless specifically stated to be otherwise, are accounted for on accrual basic except otherwise stated, considering the concept of materiality. Leave encashment and Gratuity Expenses are considered as payable when paid.

J. Provisions and Contingent Liabilities

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

K. Prior Period Adjustment

Transactions pertaining to prior period to current accounting year have been accounted under respective heads of account in Profit & Loss Account.

L. Foreign Currency Transactions

Initial Recognition : Transaction in foreign currencies are recorded in Indian Rupees using the forward booking rate to the extent available and for the balance amount using the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, recorded monetary balances are reported in Indian Rupees at the rates of exchange prevailing at the balance sheet date.

Exchange Difference: Exchange difference arising on the settlement of the monetary items or on the reporting company's monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expense in the year in which they arise in the statement of Profit & Loss.

M. Borrowing Costs

Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized as a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the profit & loss account.

N. Taxes on Income

Deferred Taxation: Deferred Tax resulting from timing differences between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing difference are expected to crystallize. In case of Deferred Tax Assets and Liabilities with reasonable certainty and in case of Deferred Tax Assets represented by unabsorbed depreciation and carried forward business losses, with virtual certainty that there would be adequate future taxable income against which Deferred tax Assets can be realized.

Current Tax: Provision for Taxation is made on the basis of the Taxable Profits computed for the current accounting period in accordance with the Income tax Act, 1961.

O. Preliminary Expenses

Preliminary expenses have been amortized to the extent of 1/10th during the year.

P. Earnings per Share

Basic Earnings per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

For the purpose of calculating diluted earning per share, the net profit attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effect of the dilutive potential equity share. Share application money pending allotments have been ignored while calculating Basic and Diluted Earning per share.

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Mar 31, 2014

[A] Basis of Preparation of Financial Statements:

The financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis, except as otherwise stated, to the extent disclosed in the notes on Accounts. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211(3C) [Companies Accounting Standards Rules, 2006, as amended] and the other relevant provisions of the Companies Act, 1956.

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 VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current- noncurrent classification of assets and liabilities.

[B] Use of Estimates:

The presentation of financial statements requires that the management makes estimates and assumption that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Although, these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates. Difference between the actual result and estimates are recognized in the period in which the resuits are known/materialized.

[C] Tangible and Intangible Fixed Assets:

Tangible Fixed Assets: Tangible fixed assets are stated at cost price including cost attributable to the assets less the accumulated depreciation on it. Cost comprises the purchase price and any attributable cost of bringing the assets to its working condition for its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Fixed assets installed and put to use have been certified by management and relied by the auditors being a technical matter.

Intangible Fixed Assets: intangible assets acquired separately are measured on initial recognition at costs. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any,

[D] Depreciation:

Depreciation on tangible assets has been provided on "Straight Line" basis in accordance with the provisions of the Companies Act, 1956, in the manner and at the rates specified in Schedule XIV to the said Act, Depreciation on addition / deletion from fixed assets made during the year is provided on pro rata basis from the date of acquisition / deletion of the fixed assets to the end of the financial year. As per the consistent policy, the management has not provided any depreciation on Windmill.

[E] impairment of Assets:

The Company tests for impairments at the close of the accounting period if and only if there are indications that suggest a possible reduction in the recoverable value of an asset. If the recoverable value amount of an Asset, i.e the net releasable value or the economic value in use of a cash generating unit, is lower than the carrying amount of the Assets the difference is provided for as impairment. However, if subsequently the position reverses and the recoverable amount become higher than the carrying value the provision to the extent of the then difference is reversed, but not higher than the amount provided for. There was no impairment loss on fixed assets on the basis of review carried out by the management in accordance with Accounting Standard 28 issued by The Institute of Chartered Accountant of India.

[F] Investments:

All investments are classified as longterm investment. Long term investments are stated at cost. The fall in value being temporary in nature, no provision is made for diminution in value.

[G] Inventories:

Cost of inventories have been computed to include all cost of purchase, cost of conversion and other cost incurred in bringing them to their respective present location and condition. Raw materials and components, stores and spares are valued at cost. Cost is determined on Moving Average price basis.

[H] Employee Retirement Benefits:

Short Term Employees Benefits : The undiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employees is recognized during the year when the employee render the services. Post Employee Benefits : No provision is made for accrued liability for payment leave encashment & gratuity under the Payment of Gratuity Act, 1972, and encashment of leave as the liabilities are not ascertainable. The company will charge the same to the revenue in the year of actual payment.''

[I] Revenue, Turnover & Expenses Recognition: in case of sale of goods:

Revenue is recognizing when the significant risks and rewards of ownership of goods have passed to the buyer, which generally coincides with delivery. The sales are recorded when supply of goods takes place in accordance with the terms of sale and on change of title in the goods and is net of Central Sales Tax, VAT, Sales return and rate difference.

[J] Income & Expenditure:

All Income and Expenses to the extent consider payable and receivable respectively, unless specifically stated to be otherwise, are accounted for on accrual basic except otherwise stated, considering the concept of materiality. Leave encashment and Gratuity Expenses are considered as payable when paid.

[K] Provisions and Contingent Liabilities:

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

[L] Prior Period Adjustment:

Transactions pertaining to prior period to current accounting year have been accounted under respective heads of account in Profit & Loss Account.

[M] Foreign Currency Transactions:

Initial Recognition: Transaction in foreign currencies are recorded in Indian Rupees using the forward booking rate to the extent available and for the balance amount using the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, recorded monetary balances are reported in Indian Rupees at the rates of exchange prevailing at the balance sheet date. Exchange Difference: Exchange difference arising on the settlement of the monetary items or on the reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expense in the year in which they arise in the statement of Profit & Loss.

[N] Borrowing Costs:

Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized as a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the profit & loss account.

[O] Taxes on Income:

Deferred Taxation: Deferred Tax resulting from timing differences between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing difference are expected to crystallize. In case of Deferred Tax Assets and Liabilities with reasonable certainty and in case of Deferred Tax Assets represented by unabsorbed depreciation and carried forward business losses, with virtual certainty that there would be adequate future taxable income against which Deferred tax Assets can be realized.

Current Tax: Provision for Taxation is made on the basis of the Taxable Profits computed for the current accounting period in accordance with the Income tax Act, 1961.

[P] Preliminary Expenses:

Preliminary expenses have been amortized to the extent of l/10th during the year.

[Q] Earning Per Share:

Basic Earning per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earning per share, the net profit attributable to equity shareholders and the weighted average number of shares outstanding during the period a re adjusted for the effect of the dilutive potential equity share. Share application money pending allotments have been ignored while calculating Basic and Diluted Earning per share.

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Mar 31, 2013

A. Basis of Preparation of Financial Statements

The financial statements have been prepared in accordance with the generally accepted accounting principles in India under the historical cost convention on accrual basis, except as otherwise stated, to the extent disclosed in the notes on Accounts. These financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211(3C) [Companies Accounting Standards Rules, 2006, as amended] and the other relevant provisions of the Companies Act, 1956.

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 VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current-noncurrent classification of assets and liabilities.

B. Use of Estimates

The presentation of financial statements requires that the management makes estimates and assumption that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Although, these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates. Difference between the actual result and estimates are recognized in the period in which the results are known /materialized.

C. Tangible and Intangible Fixed Assets :

Tangible Fixed Assets: Tangible fixed assets are stated at cost price including cost attributable to the assets less the accumulated depreciation on it. Cost comprises the purchase price and any attributable cost of bringing the assets to its working condition for its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Fixed assets installed and put to use have been certified by management and relied by the auditors being a technical matter.

Intangible Fixed Assets: Intangible assets acquired separately are measured on initial recognition at costs. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any.

D. Depreciation :

Depreciation on tangible assets has been provided on "Straight Line" basis in accordance with the provisions of the Companies Act, 1956, in the manner and at the rates specified in Schedule XIV to the said Act. Depreciation on addition / deletion from fixed assets made during the year is provided on pro rata basis from the date of acquisition / deletion of the fixed assets to the end of the financial year.

E. Impairment of Assets :

The Company tests for impairments at the close of the accounting period if and only if there are indications that suggest a possible reduction in the recoverable value of an asset. If the recoverable value amount of an Asset, i.e the net releasable value or the economic value in use of a cash generating unit, is lower than the carrying amount of the Assets the difference is provided for as impairment. However, if subsequently the position reverses and the recoverable amount become higher than the carrying value the provision to the extent of the then difference is reversed, but not higher than the amount provided for. There was no impairment loss on fixed assets on the basis of review carried out by the management in accordance with Accounting Standard 28 issued by The Institute of Chartered Accountant of India.

F. Investments:

All investments are classified as long term investment. Long term investments are stated at cost. The fall in value being temporary in nature, no provision is made for diminution in value.

G. Inventories:

Cost of inventories have been computed to include all cost of purchase, cost of conversion and other cost incurred in bringing them to their respective present location and condition. Raw materials and components, stores and spares are valued at cost. Cost is determined on Moving Average price basis.

H. Employee Retirement Benefits :

Short Term Employees Benefits: The undiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employees is recognized during the period when the employee render the services.

Post Employee Benefits: Contribution to defined contribution scheme such as provident fund etc. is charged to P & L Account as incurred.

I. Revenue, Turnover & Expenses Recognition:

In case of sale of goods:

Revenue is recognizing when the significant risks and rewards of ownership of goods have passed to the buyer, which generally coincides with delivery.

The sales are recorded when supply of goods takes place in accordance with the terms of sale and on change of title in the goods and is net of Central Sales Tax, VAT, Sales return and rate difference.

In case of job work:

In contract involve rendering of services, revenue is measured using the proportionate completion method.

J. Income & Expenditure :

All Income and Expenses to the extent consider payable and receivable respectively, unless specifically stated to be otherwise, are accounted for on accrual basic except otherwise stated, considering the concept of materiality. Leave encashment expenses are considered as payable when paid.

K. Provisions and Contingent Liabilities :

The Company recognizes a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources and reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

L. Prior Period Adjustment:

Transactions pertaining to prior period to current accounting year have been accounted under respective heads of account in Profit & Loss Account.

M. Foreign Currency Transactions:

Initial Recognition: Transaction in foreign currencies are recorded in Indian Rupees using the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, recorded monetary balances are reported in Indian Rupees at the rates of exchange prevailing at the balance sheet date.

Exchange Difference: Exchange difference arising on the settlement of the monetary items or on the reporting company''s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expense in the year in which they arise in the statement of Profit & Loss.

N. Borrowing Costs:

Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized as a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the profit & loss account.

O. Taxes on Income:

Deferred Taxation: Deferred Tax resulting from timing differences between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing difference are expected to crystallize. In case of Deferred Tax Assets and Liabilities with reasonable certainty and in case of Deferred Tax Assets represented by unabsorbed depreciation and carried forward business losses, with virtual certainty that there would be adequate future taxable income against which Deferred tax Assets can be realized.

Current Tax: Provision for Taxation is made on the basis of the Taxable Profits computed for the current accounting period in accordance with the Income tax Act, 1961.

P. Preliminary Expenses:

Preliminary expenses have been amortized to the extent of 1/1 Oth during the year.

Q. Earning Per Share:

Basic Earning per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earning per share, the net profit attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effect of the dilutive potential equity share. Share application money pending allotments have been ignored while calculating Basic and Diluted Earning per share.

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Mar 31, 2012

I) ACCOUNTING CONCEPT:

a. These accounts are prepared on the historical cost convention and on the accounting principle of a going concern,

b. Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principle

ii) RECOGNITION OF INCOME AND EXPENDITURE

Company accounts Incomes and Expenses on accrual basis in accordance with the generally accepted accounting principles except dividend which are accounted on cash basis.

iii) USE OF ESTIMATES

The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.

iv) FIXED ASSETS & DEPRECIATION

The Gross Block of Fixed Assets is shown at historical cost, which includes taxes and other identifiable direct Expenses, less impairment loss. The cost of fixed assets includes the cost of acquisition including freight, taxes, duties and other identifiable direct expenses, except otherwise specifically excluded and expressed by way of note, attributable to acquisition of assets up to the date the asset put to use less the accumulated depreciation on it.

Depreciation is provided on Straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The depreciation on addition / disposal is provided pro-rate basis.

v) SALES/TURNOVER

Sales are recognized, net of returns, on dispatch of goods to customers the satisfaction of the customer and are reflected in the accounts at net value.

vi) INVESTMENT

Investments are carried at cost. They are long-term investment: The fall in value being temporary in nature, no provision is made for diminution in value.

vii) INVENTORY

Inventories are valued on FIFO basis at lower of cost or market price except cotton waste and scrap material, which are shown at Net Realizable Value.

viii) TREATMENT OF RETIREMENT BENEFITS

1. Short Term Employee Benefits. The undiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employee is recognized during the period when the employee render the service.

2. Post Employee Benefits: Contribution to defined contribution scheme such as provident fund etc. is charged to P&L Account as incurred.

ix) TAXATION

Tax liabilities of the company are estimated considering the provision of the I.T. Act, 1961. The deferred tax Liability for timing difference between the book and tax profit for the year is accounted using the rates and Tax Laws that have been enacted or substantially enacted at the balance sheet date Deferred Tax assets arising from the timing difference are recognized to the extent that there is reasonable certainty that sufficient future taxable income will be available. translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the profit and loss account.

x) CONTINGENT LIABILITIES

Contingent liabilities are not provided for (unless otherwise stated) and are disclosed by way of notes on account, if any.

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Mar 31, 2010

I) ACCOUNTING CONCEPT

a. These accounts are prepared on the historical cost convention and on the accounting principle of a going concern.

b. Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principle.

ii) RECOGNITION OF INCOME AMD EXPENDITURE

Company accounts Incomes and Expenses on accrual basis in accordance with the generally accepted accounting principles excepts dividend and exports incentives, which are on cash basis.

iii)- USE OF ESTIMATES

The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and reported amount of revenues and expenses during the reporting period, Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

iV) FIXED ASSETS & DEPRECIATION,

The Cross Block of Fixed Assets is shown at historical cost, which includes taxes and Other identifiable direct Expenses, less impairment Toss. The cost of fixed assets includes the cost of acquisition including freight, taxes, duties and other identifiable direct expenses, except otherwise specifically excluded and expressed by way of note, attributable to acquisition of assets up to the date the asset put to use less the accumulated depreciation on it.

Depreciation is provided on Straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The depreciation on addition / disposal Is provided pro-rate basis.

v) SALES/TURNOVER

Sales are recognized, net of returns, on dispatch of goods to customers the satisfaction of the customer and are reflected In the accounts at net value.

vi) INVESTMENT

Investments are carried at cost. They are long-term investment. The fall in value being temporary in nature, no provision Is made for diminution in value.

Vii) INVENTORY

Inventories are valued on FIFO basis at lower of cost or market price except cotton waste and scrape material, which are shown at Net Realizable Value

viii) TREATMENT OF RETIREMENT BENEFITS

1. Short Term Employee Benefits:Theundiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employee is recognized during the period when the employee render the service,

2. Post Employee Benefits: Contribution to defined contribution scheme such as provident fund etc. is charged to P&L Account as Incurred.

ix) TAXATION

Tax liabilities of the company are estimated considering the provision of the I,T Act, 1961. - The deferred tax Liability for timing difference between the book and tax profit for the year la accounted using the rates and Tax Laws that have been enacted or substantially enacted at the balance sheet date. Deferred Tax assets arising from the timing difference are recognized to the extent that there Is reasonable certainty that sufficient future taxable. Income will be available,

x) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated In foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss la recognized in the profit and loss account.

Xi) CONTINGENT LIABILITIES

Contingent liabilities are not provided (unless otherwise stated) end are disclosed by way, of notes on account, of following.

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Mar 31, 2009

I) ACCOUNTING CONCEPT:

a. These accounts are prepared on the historical cost convention and on the accounting principle of a going concern.

b. Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principle.

ii) RECOGNITION OF INCOME AND EXPENDITURE

Company accounts Incomes and Expenses on accrual basis in accordance with the generally accepted accounting principles excepts dividend and exports incentives, which are on cash basis.

iii) USE OF ESTIMATES

The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

iv) FIXED ASSETS & DEPRECIATION

The Gross Block of Fixed Assets is shown at historical cost, which includes taxes and other identifiable direct Expenses, less impairment loss. The cost of fixed assets includes the cost of acquisition including freight, taxes, duties and other identifiable direct expenses, except otherwise specifically excluded and expressed by way of note, attributable to acquisition of assets up to the date the asset put to use less the accumulated depreciation on it.

Depreciation is provided on Straight-line method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. The depreciation on addition / disposal is provided pro-rate basis.

v) SALES/TURNOVER

Sales are recognized, net of returns, on dispatch of goods to customers the satisfaction of the customer and are reflected in the accounts at net value.

vi) INVESTMENT

Investments are carried at cost. They are long-term investment. The fall in value being temporary in nature, no provision is made for diminution in value.

vii) INVENTORY

Inventories are valued on FIFO basis at lower of cost or market price except cotton waste and scrape material, which are shown at Net Realizable Value.

vii) TREATMENT OF RETIREMENT BENEFITS

1. Short Term Employee Benefits: The undiscounted amount of short term employee benefits expected to be paid in exchange for the service rendered by employee is recognized during the period when the employee render the service.

2. Post Employee Benefits: Contribution to defined contribution scheme such as provident fund etc. is charged to P&L Account as incurred.

viii) TAXATION

Tax liabilities of the company are estimated considering the provision of the IT. Act, 1961. The deferred tax Liability for timing difference between the book and tax profit for the year is accounted using the rates and Tax Laws that have been enacted or substantially enacted at the balance sheet date. Deferred Tax assets arising from the timing difference are recognized to the extent that there is reasonable certainty that sufficient future taxable income will be available.

ix) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currency are translated at the rates of exchange at the balance sheet date and resultant gain or loss is recognized in the profit and loss account.

x) CONTINGENT LIABILITIES

Contingent liabilities are not provided (unless otherwise stated) and are disclosed by way of notes on account, of following,