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Accounting Policies of Kilitch Drugs(I) Ltd. Company

Mar 31, 2023

Notel - Corporate Information:

The Company is a public limited company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India and its shares are publicly traded on the National Stock Exchange [''NSE'') and the Bombay Stock Exchange [''BSE''), in India. The registered office of the company is located at C-301-2,

M.I.D.C. TTC Industrial Area, Pawane Village, Thane -4-00705.

These financial statements were approved and adopted by the Board of Directors of the Company in their meeting dated 29th May 2023.

Note 2 - Basis of Preparation of FinanciaLStatements:

The Financial Statements have been prepared to comply in all materialaspects with Indian Accounting Standards [Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended.

The significant accounting policies used in preparing financial statements are set out in Note 3 of the Notes on Financial Statements and are applied consistently to all the periods presented.

Note3 -Significant Accounting Policies:A. Functionaland presentation of currency:

The financial statements are presented in Indian Rupees, which is the Company''s functional currency and all amounts are rounded to the nearest rupees in lakhs.

B. Basis of measurement:

The Financial Statements have been prepared on historical cost basis, except the following:

• Certainfinancialassetsand liabilities are measured at fairvalue.

• Defined benefit plans - plan assets measured at fair value.

• Share Based Payments.

C. Use of Estimates:

The preparation of the financial statements requires management to make estimates, judgements and assumptions that affect the reported balances of assets and liabilities, disclosure of contingent liabilities as on the date of financial statements and reported amounts of income and expenses during the period.

Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

D. Property, Plant and Equipment:

Freehold land is carried at historical cost. Capital work in progress, and all other items of property, plant and equipment are stated at historical cost net of accumulated depreciation and accumulated impairment losses, if any.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

Depreciation methods, estimated useful lives and residualvalue

Depreciation is calculated using the Written down Value method to allocate their cost, net of their residual values, over their estimated useful lives as specified by Schedule to the Companies Act; 2013. The residual values are not more than 5% of the original cost of the asset. The assets'' residual values and useful lives and method of depreciation are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greaterthan its estimated recoverable amount.

Gains and losses on disposals are determined by

comparing proceeds with carrying amount. These are included in profit or loss.

E. Intangible assets:

Identifiable intangible assets are recognised when the Company controls the asset & it is probable that future economic benefits attributed to the asset will flow to the Company and the cost of the asset can be reliably measured.

Intangible assets acquired are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses.

Intangible assets are amortised overthe period on straight line basis. The assets useful life reviewed at each financial year end.

Amortisation methods and periods

Estimated useful lives of Intangible assets are considered as 5 years. Intangible assets are amortised over its useful life using the straight-line method. The amortisation period and the amortisation method for an intangible asset are reviewed 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 amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.

F. Impairment of Non - Financial Assets:

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or Cash Generating Unit''s [CGU) fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing the value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

In determining fair value less costs of disposal, recent market transactions are taken into account, if no such transactions can be identified, an appropriate valuation model is used.

G. Financial Instruments:

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instruments of another entity. Classifications of financial instruments are in accordance with the substance of the contractual arrangement and as per the definitions of financial assets, financial liability and an equity instruments.

Financial Assets and investments

I. Initial recognition and measurement:

At initial recognition, the company measures a financial asset [other than financial asset at fair value through profit or loss) at its fair value plus or minus, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in the statement of profit & loss.

II. Subsequent recognition and measurement:

Subsequent measurement of financial asset depends on the company''s business modelfor managing the asset and the cash flow characteristics of the asset. Forthe purpose of subsequent recognition and measurement financial assets are classified in fourcategories:

• Debtinstrumentatamortised 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 amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or losswhen the asset is derecognised or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.

• Debt instrument at fair value through other comprehensive income (FVOCI):

Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'' cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income [FVOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses and interest revenue which are recognised in the statement of profit & loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method.

• Debt instrument at fair value through profit and loss IFVTPL):

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in the statement of profit & loss and presented net in the statement of profit & loss within other gains/(losses) in the period in which it arises. Interest income from these financial assets is included in other income.

• Equity instruments:

All equity instruments are initially measured at fair value. Any subsequent fair value gain / loss is recognised through profit or loss if such investments are held for trading purposes. The fair value gains or losses of all other equity investments are recognised in Other Comprehensive Income.

• Investment inSubsidiaryand Associates:

The company has accounted for its Investment in subsidiaries and associates at cost.

III. De-recognition:

A financial asset is primarily derecognised i.e. removed from Company''s financial statement when:

• The rights to receive cash flows from asset have expired, or

• The Company has transferred its right to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under ''pass- through'' arrangement and either;

a) The Company has transferred substantially a lit he risks and rewards of the assets,

b) The Company has neither transferred nor retained substantially all the risksand rewardsofthe asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a passthrough arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the company could be required to repay.

IV. Trade receivables:

A receivable is classified as a ''trade receivable'' if it is in respect to the amount due from customers on account of goods sold or services rendered in the ordinary course of business. Trade receivables are recognised initially at fair value and subsequently measured at fair value less provision for impairment.

Financial Liabilities:I. Initialrecognitionand measurement:

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The company''s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts.

II. Subsequent measurement:

The measurement of financial liabilities depends on their classification, as described below:

Financial liabilities at fair value through profit and loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and has designated upon initial measurement recognition at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term.

Gains or losses on liabilities held for trading are recognised in the statement of profit & loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied.

III. Loansand Borrowings:

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate [ElR) method. Gains and losses are recognised in the statement of profit & loss when the liabilities are derecognised as well as through the ElR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.

IV. Trade and other payables:

These amounts represent liabilitiesforgoodsand services provided to the company prior to the end of financial year which are unpaid. Trade and other payables are presented as current liabilities unless payment is not due within 12 monthsafterthe reporting period.

V. De-recognition:

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified,

such an exchange or modification is treated as the Derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

H. Impairment of Financial assets:

The company assesses impairment based on expected credit losses (ECL) modelto the following:

• Financial assets carried at amortised cost;

• Financialasset measured at FVOCI debt instruments.

The Company follows ''simplified approach'' for recognition of impairment loss allowance onTrade receivables or contract revenue receivables.

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

The Company uses a provision matrix to determine impairment loss allowance on its trade receivables. The provision matrix is based on its historically observed default ratesoverthe expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated andchangesinthe forward-looking estimates are analysed.

For recognition of impairment loss on other financial assets and risk exposure, the company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. Flowever, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longera significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

For assessing increase in credit risk and impairment loss,

the company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis.

I. Cashand cash equivalents:

Cash and cash equivalents includes cash on hand and at bank, deposits with banks and other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

J. Inventories

Inventories are valued at lower of cost or net realisable value. Cost isdetermined on FIFO basis.

Cost of inventories also includes all other costs incurred in bringing the inventories to their present location and condition. Net realisable 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.

K. Foreign currency transactions:

The transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currency at the end of year are translated using the closing rate of exchange. Non- monetary items that are to be carried at historical cost are recorded using exchange rate prevailing on the date of transaction. Non- monetary items that are to be carried at fair value are recorded using exchange rate prevailing on the date of fair value measured. Any income or expenses on account of exchange difference either on settlement or on translation is recognised in the statement of profit & loss.

L. Classification of assets and liabilities as current and non-current:

The Company presents assets and liabilities in Balance Sheet based on current/non-current classification.

An asset isclassified ascurrent when it is:

• Expected to be realised or intended to be sold or consumed in normal operating cycle,

• Field primarily for the purpose of trading,

• Expected to be realised within twelve months after the reporting period, or

• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability forat least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified ascurrent when:

• It is expected to be settled in normaloperating cycle,

• It is held primarily for the purpose of trading,

• It is due to be settled within twelve months after the reporting period, or

• There is no unconditional rightto deferthe settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets and liabilities.

M. Equity share capital:

Ordinary shares are classified as equity. Incremental costs net of taxes directly attributable to the issue of new equity sharesare reducedfrom retained earnings, net of taxes.

N. Revenue Recognition:

Revenue is recognised to the extent that it is probable that the future economic benefits will flow to the entity and it can be reliably measured. 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.

• Sale of goods

Revenue from sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer, usually on delivery of goods, it is probable that the economic benefit will flow to the Company, the associated costs and possible return of goods can be estimated reliably, there is neither continuing management involvement to the degree usually associated with ownership nor effective control over the goods sold and the amount of revenue can be measured reliably.

Provisions for chargeback, rebates, discounts and medical aid payments are estimated and provided for in the year of salesand recorded as reduction of revenue.

• Sales Returns

With respect to established products, the Company considers its historical experience of sales returns, levels of inventory in the distribution channel, estimated shelf life, product discontinuances, price changes of competitive products, and the introduction of competitive new products, to the extent each of these factors impact the Company''s business and markets. With respect to new products introduced by the Company, such products have historically been either extensions of an existing line of product where the Company has historical experience or in therapeutic categories where established products exist and are sold either by the Company or the Company''s competitors.

• Interest income:

Interest income from debt instrument is recognised using effective interest rate method. The effective interest rate is the rate that discounts estimated future cash receipts through the expected life of financial asset to the gross carrying amount of financial asset. When calculating effective interest rate, the company expects cash flows by considering all contractual terms of financial instrument but does not consider the expected credit losses.

• Dividends

Dividends are recognised when the right to receive the payment is established.

0. Employee''s benefits:1. Short-term Employee benefits:

All employees'' benefits payable wholly within 12 months rendering services are classified as Short Term obligations.

Benefits such as salaries, wages, short term compensated absences, performance incentives, expected cost of bonus and ex-gratia are recognised during the period in which the employees renders related services.

ii. Post-employment benefitsa. Defined Contribution Plan

The defined contribution plan is post-employment benefit

plan under which the Company contributes fixed contribution to a government administered fund and will have no legal or constructive obligation to pay further contribution. The Company''s defined contribution plan comprises of Provident Fund, Labour Welfare Fund and Employee State Insurance Scheme. The Company''s contribution to defined contribution plans are recognised in the statement of profit & loss in the period in which the employee rendersthe related services.

b. Defined benefit plan

The Company has defined benefit plans comprising of gratuity. Company''s obligation towards gratuity liability is partially funded as Management has initiated a decision to be funded and managed by Life Insurance Corporation of India over the period of 20 equated quarterly instalments overa period of 5years.

The present value of the defined benefit obligations is determined based on actuarial valuation using the projected unit credit method. The rate used to discount defined benefit obligation is determined by reference to market yields at the Balance Sheet date on Indian Government Bonds forthe estimated term of obligations.

Based on actuarial valuation usingthe projected unit credit method. The rate used to discount defined benefit obligation is determined by reference to market yields at the Balance Sheet date on Indian Government Bonds for the estimated term of obligations.

Actuarial gains or losses arising on account of experience adjustment and the effect of changes in actuarial assumptions are recognised immediately in the statement of profit & loss as income or expense.

Re-measurements comprising of

[a] Actuarialgainsand losses,

[b] the effect of the asset ceiling (excluding amounts included in net interest on the net defined benefit liability] and the return on plan assets [excluding amounts included in net interest on the net defined benefit liability) are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. Re-measurements are not reclassified to the statement of profit & loss in subsequent periods.

The expected return on plan assets is the Company''s expectation of average long-term rate of return on the

investment of the fund over the entire life of the related obligation. Plan assets are measured at fair value as at the Balance Sheet date.

The interest cost on defined benefit obligation and expected return on plan assets is recognised under finance cost.

Gains or losses on the curtailment or settlement of defined benefit plan are recognised when the curtailment or settlementoccurs.

c. Other long-term benefits

The Company has other long-term benefits in the form of leave benefits. The present value of the other long term employee benefits is determined Gains or losses on the curtailment or settlement of other long-term benefits are recognised when the curtailment or settlement occurs.

d. Share-based payments

Share-based compensation benefits are provided to employees via Employee Stock Option Plans with the ESOS 2007 & ESOS2020.

The fair value of options granted under the Employee Option Plan is recognised as an employee benefits expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted: Including any market performance conditions [e.g., the entity''s share price] excluding the impact of any service and non-market performance vesting conditions [e.g. profitability, sales growth targets and remaining an employee of the entity overa specified time period), and

Including the impact of any non-vesting conditions [e.g. the requirement for employees to save or holdings shares for a specific period of time).

The total expense, other than in respect of options granted to employees of group companies, is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. The cost of options granted to employees of group companies is debited to the cost of the investment of the respective companies.

At the end of each period, the company revises its estimates of the number of options that are expected to

vest based on the non-market vesting and service conditions. It recognises the impact of the revision to original estimates, if any, in the statement of profit & loss / Investment, with a corresponding adjustment to other equity.

P. Borrowing Cost:

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for such capitalisation.

Other borrowing costs are expensed in the period in which they are incurred.

Borrowing costs consist of interestand othercoststhat are incurred in connection with the borrowing of funds.

Q. IncomeTaxes:

• Current Income Tax:

Current Income Tax liabilities are measured at the amount expected to be paid to the taxation authorities using the tax rates and tax laws that are enacted or subsequently enacted at the end of the reporting period. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and creates provisions where appropriate.

• Deferred Tax:

Deferred Tax is provided, using the Balance sheet approach, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred Tax is determined using the tax rates and tax laws that are enacted or subsequently enacted at the end of the reporting period.

Deferred Tax liabilities are recognised for all temporary differences.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporarydifferencesand losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and the deferred tax balances relate to the same taxation authority. Current tax asset and liabilities are offset where the company has a legally enforceable right and intends either to settle on net basis, or to realise the asset and settle the liability simultaneously.

R. Provisionsand contingencies:

Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, 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 of the amount of the obligation. If the effect of the time value of money is material, provisions are discounted using the government securities'' interest rate for the equivalent period. Unwinding of the discount is recognised in the Statement of Profit and Loss as a finance cost. Provisions are reviewed at each balance sheet date and are adjusted to reflect the current best estimate. Provisions are not recognised forfuture operating losses.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made. Information on contingent liability is disclosed in the notes to the financial statements. Contingent assets are not recognised. However, when the realisation of income is virtually certain, then the related asset is no longer a contingent asset, but it is recognised as an asset.

S. Earnings per share:

Basic earnings per share is calculated by dividing the net profit or loss (after tax) for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is calculated by dividing the net profit or loss (after tax) for the year attributable to equity shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

Note L - Use of Significant Accounting Estimates, Judgments and Assumptions

In the process of applying the Company''s accounting policies, management has made the following estimates and judgements, which have significant effect on the amounts recognised inthefinancialstatements:

A. Depreciation and useful lives of Property, Plant and Equipment

Property, plant and equipment are depreciated over the estimated useful lives of the assets, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and residual values are based on the Company''s historical experience with similar assets and take into account anticipated technological changes. The depreciation for future periods is adjusted if there are significant changes from previous estimates.

B. Recoverability of trade receivables

Judgments are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. The Company uses a provision matrix to determine impairment loss allowance on its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

C. Defined Benefit plans

The cost of the defined benefit plan and other postemployment benefits and the present value of such obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, a

a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

D. Provisions:

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change. Since the cash outflows can take place many years in the future, the carrying amounts of provisions and liabilities are reviewed regularly and adjusted to take account of changing facts and circumstances.

E. Impairment of financialassets:

The impairment provisions for financial assets are based on assumptions about risk of default and expected cash loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

Estimates and judgments are based on historical experience and other factors, including expectations of future events that may have a financial impact on the Company and that are believed to be reasonable under the circumstances. They are continuously evaluated.

F. FairValue measurement:

The Company measures financial instrument such as certain investments, at fair value at each balance sheet date.

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 asset or transfer the liability takes place either:

¦ In the principal market for the asset or liability, or

¦ In the absence of a principal market, in the most advantageous market for the asset or liability.

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

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

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 or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

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

• Level2 — Valuation techniquesforwhichthe lowest level inputthat issignificanttothefairvalue measurement is directly or indirectly observable

• Level3 — Valuation techniquesforwhichthe lowest level inputthat issignificanttothefairvalue measurement is unobservable

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation [based on the lowest level input that is significant to the fair value measurement as a whole] at the end of each reporting period.

Note 5- New Standards/Amendments notified but not yet effective:

Ministry of Corporate Affairs [MCA], on March 31, 2023, through the Companies (Indian Accounting Standards (Ind AS]] Amendment Rules, 2023 amended certain existing Ind ASs on miscellaneous issues with effect from 1st April 2023.

Following are few key amendments relevant to the Company:

I. Ind AS 1 - Presentation of Financial Statements & Ind AS 34- - Interim Financial Reporting - Material accounting policy information (including focus on how an entity applied the requirements of nd AS) shall be disclosed instead of significant accounting policies as part of financial statements.

ii. Ind AS 107 - Financial Instruments: Disclosures -Information about the measurement basis for financial instruments shall be disclosed as part of material

accounting policy information.

iii. Ind AS 8 - Accounting policies, changes in accounting estimate and errors- Clarification on what constitutes an accounting estimate provided.

iv. Ind AS 12 - Income Taxes - This amendment has narrowed the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equal and offsetting temporary differences.

The Company does not expect the effect of this on the financial statements to be material, based on preliminary evaluation.


Mar 31, 2018

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES:

a) Functional and presentation of currency:

The financial statements are presented in Indian Rupees, which is the Company’s functional currency and all amounts are rounded to the nearest rupees in lakhs.

b) Basis of measurement:

The Financial Statements have been prepared on historical cost basis, except the following:

- Certain financial assets and liabilities are measured at fair value.

- Defined benefit plans - plan assets measured at fair value.

- Share Based Payments.

c) Use of Estimates:

The preparation of the financial statements requires management to make estimates, judgements and assumptions that affect the reported balances of assets and liabilities, disclosure of contingent liabilities as on the date of financial statements and reported amounts of income and expenses during the period. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

d) Property, Plant and Equipment:

Freehold land is carried at historical cost. Capital work in progress, and all other items of property, plant and equipment are stated at historical cost net of accumulated depreciation and accumulated impairment losses, if any.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

Depreciation methods, estimated useful lives and residual value

Depreciation is calculated using the Written down Value method to allocate their cost, net of their residual values, over their estimated useful lives as specified by Schedule II to the Companies Act; 2013. The residual values are not more than 5% of the original cost of the asset. The assets’ residual values and useful lives and method of depreciation are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss.

e) Intangible assets:

Identifiable intangible assets are recognised when the Company controls the asset & it is probable that future economic benefits attributed to the asset will flow to the Company and the cost of the asset can be reliably measured.

Intangible assets acquired are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses.

Intangible assets are amortised over the period on straight line basis. The assets useful life reviewed at each financial year end.

Amortisation methods and periods

Estimated useful lives of Intangible assets are considered as 5 years. Intangible assets are amortised over its useful life using the straight-line method. The amortisation period and the amortisation method for an intangible asset are reviewed 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 amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.

f) Impairment of Non - Financial Assets:

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or Cash Generating Unit’s (CGU) fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing the value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no such transactions can be identified, an appropriate valuation model is used.

g) Financial Instruments:

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instruments of another entity. Classifications of financial instruments are in accordance with the substance of the contractual arrangement and as per the definitions of financial assets, financial liability and an equity instruments.

Financial Assets and investments

i) Initial recognition and measurement:

At initial recognition, the company measures a financial asset (other than financial asset at fair value through profit or loss) at its fair value plus or minus, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in the statement of profit & loss.

ii) Subsequent recognition and measurement:

Subsequent measurement of financial asset depends on the company’s business model for managing the asset and the cash flow characteristics of the asset. For the purpose of subsequent recognition and measurement financial assets are classified in four categories:

- Debt instrument at amortised 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 amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.

- Debt instrument at fair value through other comprehensive income (FVOCI):

Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses and interest revenue which are recognised in the statement of profit & loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method.

- Debt instrument at fair value through profit and loss (FVTPL):

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in the statement of profit & loss and presented net in the statement of profit & loss within other gains/(losses) in the period in which it arises. Interest income from these financial assets is included in other income.

- Equity instruments:

All equity instruments are initially measured at fair value. Any subsequent fair value gain / loss is recognised through profit or loss if such investments are held for trading purposes. The fair value gains or losses of all other equity investments are recognised in Other Comprehensive Income.

- Investment in Subsidiary and Associates:

The company has accounted for its Investment in subsidiaries and associates at cost.

iii) Derecognition:

A financial asset is primarily derecognised i.e. removed from Company’s financial statement when:

- The rights to receive cash flows from asset have expired, or

- The Company has transferred its right to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under ‘pass- through’ arrangement and either;

a) The Company has transferred substantially all the risks and rewards of the assets,

b) The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the company could be required to repay.

iv) Trade receivables:

A receivable is classified as a ‘trade receivable’ if it is in respect to the amount due from customers on account of goods sold or services rendered in the ordinary course of business. Trade receivables are recognised initially at fair value and subsequently measured at fair value less provision for impairment.

Financial Liabilities:

i) Initial recognition and measurement:

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts.

ii) Subsequent measurement:

The measurement of financial liabilities depends on their classification, as described below:

Financial liabilities at fair value through profit and loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and has designated upon initial measurement recognition at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term.

Gains or losses on liabilities held for trading are recognised in the statement of profit & loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied.

iii) Loans and Borrowings:

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate (EIR) method. Gains and losses are recognised in the statement of profit & loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.

iv) Trade and other payables:

These amounts represent liabilities for goods and services provided to the company prior to the end of financial year which are unpaid. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period.

v) Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

h) Impairment of Financial assets:

The company assesses impairment based on expected credit losses (ECL) model to the following:

- Financial assets carried at amortised cost;

- Financial asset measured at FVOCI debt instruments.

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on

- Trade receivables or contract revenue receivables.

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

The Company uses a provision matrix to determine impairment loss allowance on itstrade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

For recognition of impairment loss on other financial assets and risk exposure, the company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

For assessing increase in credit risk and impairment loss, the company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis.

i) Cash and cash equivalents:

Cash and cash equivalents includes cash on hand and at bank, deposits with banks and other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

j) Inventories

Inventories are valued at lower of cost or net realisable value. Cost is determined on FIFO basis.

Cost of inventories also includes all other costs incurred in bringing the inventories to their present location and condition. Net realisable 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.

k) Foreign currency transactions:

The transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of transaction. Monetary items denominated in foreign currency at the end of year are translated using the closing rate of exchange. Non- monetary items that are to be carried at historical cost are recorded using exchange rate prevailing on the date of transaction. Non- monetary items that are to be carried at fair value are recorded using exchange rate prevailing on the date of fair value measured. Any income or expenses on account of exchange difference either on settlement or on translation is recognised in the statement of profit & loss.

l) Classification of assets and liabilities as current and non-current:

The Company presents assets and liabilities in Balance Sheet based on current/non-current classification.

An asset is classified as current when it is:

a) Expected to be realised or intended to be sold or consumed in normal operating cycle,

b) Held primarily for the purpose of trading,

c) Expected to be realised within twelve months after the reporting period, or

d) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified as current when:

a) It is expected to be settled in normal operating cycle,

b) It is held primarily for the purpose of trading,

c) It is due to be settled within twelve months after the reporting period, or

d) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets and liabilities.

m) Equity share capital:

Ordinary shares are classified as equity. Incremental costs net of taxes directly attributable to the issue of new equity shares are reduced from retained earnings, net of taxes.

n) Revenue Recognition:

Revenue is recognised to the extent that it is probable that the future economic benefits will flow to the entity and it can be reliably measured. 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.

Interest income

Interest income from debt instrument is recognised using effective interest rate method. The effective interest rate is the rate that discounts estimated future cash receipts through the expected life of financial asset to the gross carrying amount of financial asset. When calculating effective interest rate, the company expects cash flows by considering all contractual terms of financial instrument but does not consider the expected credit losses.

Dividends

Dividends are recognised when the right to receive the payment is established.

o) Employees benefits:

(i) Short-term Employee benefits:

All employees’ benefits payable wholly within 12 months rendering services are classified as Short Term obligations. Benefits such as salaries, wages, short term compensated absences, performance incentives, expected cost of bonus and ex-gratia are recognised during the period in which the employees renders related services.

(ii) Post-employment benefits

a. Defined Contribution Plan

The defined contribution plan is postemployment benefit plan under which the Company contributes fixed contribution to a government administered fund and will have no legal or constructive obligation to pay further contribution. The Company’s defined contribution plan comprises of Provident Fund, Labour Welfare Fund and Employee State Insurance Scheme. The Company’s contribution to defined contribution plans are recognised in the statement of profit & loss in the period in which the employee renders the related services.

b. Defined benefit plan

The Company has defined benefit plans comprising of gratuity. Company’s obligation towards gratuity liability is Unfunded and Management has initiated a decision to be funded and managed by Life Insurance Corporation of India (LIC).

The present value of the defined benefit obligations is determined based on actuarial valuation using the projected unit credit method. The rate used to discount defined benefit obligation is determined by reference to market yields at the Balance Sheet date on Indian Government Bonds for the estimated term of obligations.

Re-measurements comprising of (a) actuarial gains and losses, (b) the effect of the asset ceiling (excluding amounts included in net interest on the net defined benefit liability) and (c) the return on plan assets (excluding amounts included in net interest on the net defined benefit liability) are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. Re-measurements are not reclassified to the statement of profit & loss in subsequent periods.

The expected return on plan assets is the Company’s expectation of average long-term rate of return on the investment of the fund over the entire life of the related obligation. Plan assets are measured at fair value as at the Balance Sheet date.

The interest cost on defined benefit obligation and expected return on plan assets is recognised under finance cost.

Gains or losses on the curtailment or settlement of defined benefit plan are recognised when the curtailment or settlement occurs.

(iii) Other long-term benefits

The Company has other long-term benefits in the form of leave benefits. The present value of the other long term employee benefits is determined based on actuarial valuation using the projected unit credit method. The rate used to discount defined benefit obligation is determined by reference to market yields at the Balance Sheet date on Indian Government Bonds for the estimated term of obligations.

Actuarial gains or losses arising on account of experience adjustment and the effect of changes in actuarial assumptions are recognised immediately in the statement of profit & loss as income or expense.

Gains or losses on the curtailment or settlement of other long-term benefits are recognised when the curtailment or settlement occurs.

(iv) Share-based payments

Share-based compensation benefits are provided to employees via Employee Stock Option Plans by Kilitch Drugs India Limited.

The fair value of options granted under the Employee Option Plan is recognised as an employee benefits expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted:

- including any market performance conditions (e.g., the entity’s share price)

- excluding the impact of any service and nonmarket performance vesting conditions (e.g. profitability, sales growth targets and remaining an employee of the entity over a specified time period), and

- Including the impact of any non-vesting conditions (e.g. the requirement for employees to save or holdings shares for a specific period of time).

The total expense, other than in respect of options granted to employees of group companies, is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. The cost of options granted to employees of group companies is debited to the cost of the investment of the respective companies. At the end of each period, the company revises its estimates of the number of options that are expected to vest based on the non-market vesting and service conditions. It recognises the impact of the revision to original estimates, if any, in the statement of profit & loss / Investment, with a corresponding adjustment to other equity.

p) Borrowing Cost:

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for such capitalisation.

Other borrowing costs are expensed in the period in which they are incurred.

Borrowing costs consist of interest and other costs that are incurred in connection with the borrowing of funds.

q) Income Taxes:

Current Income Tax:

Current Income Tax liabilities are measured at the amount expected to be paid to the taxation authorities using the tax rates and tax laws that are enacted or subsequently enacted at the end of the reporting period. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and creates provisions where appropriate.

Deferred Tax:

Deferred Tax is provided, using the Balance sheet approach, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred Tax is determined using the tax rates and tax laws that are enacted or subsequently enacted at the end of the reporting period.

Deferred Tax liabilities are recognised for all temporary differences. Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and the deferred tax balances relate to the same taxation authority. Current tax asset and liabilities are offset where the company has a legally enforceable right and intends either to settle on net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in the statement of profit & loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

r) Provisions and contingencies:

Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, 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 of the amount of the obligation. If the effect of the time value of money is material, provisions are discounted using the government securities’ interest rate for the equivalent period. Unwinding of the discount is recognised in the

Statement of Profit and Loss as a finance cost. Provisions are reviewed at each balance sheet date and are adjusted to reflect the current best estimate. Provisions are not recognised for future operating losses.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made. Information on contingent liability is disclosed in the notes to the financial statements. Contingent assets are not recognised. However, when the realisation of income is virtually certain, then the related asset is no longer a contingent asset, but it is recognised as an asset.

s) Earnings per share:

Basic earnings per share is calculated by dividing the net profit or loss (after tax) for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is calculated by dividing the net profit or loss (after tax) for the year attributable to equity shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.


Mar 31, 2016

NOTE “1” SIGNIFICANT ACCOUNTING POLICIES: a) Basis of Preparation of Financial Statements

The Financial statements have been prepared under the historical cost convention on the accrual basis of accounting in accordance with the accounting principles generally accepted in India (“GAAP”) including the Accounting Standards (“AS”) notified under the relevant provisions of the Companies Act, 2013.

b) Inflation

The financial statements are based on historical costs. These costs are not adjusted to reflect the impact of the changing value of the purchasing power of money.

c) Use of Estimates

The preparation of Financial Statements in conformity with GAAP requires Management to make estimate and assumption that affect the reported amount of assets and liabilities and disclosure of contingent liabilities on the date of financial statements and reported amount of revenue and expenses for the year. Actual result could differ from these estimates. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized. Any revision to an accounting estimate is recognized prospectively in the year of revision.

d) Inventories

Raw Material, Packing Material, Stores and spare parts, Work-in-progress and Finished Goods are valued at cost or net realizable value whichever is lower. Cost of Raw Materials, Packing Materials and Stores & spare parts are determined on last purchase price. Work-in-progress and Finished Goods inventories include production overheads, to the extent applicable.

e) Revenue Recognition

i. Sales are recognized net of returns, trade discounts, rebates and include excise duty on manufactured products.

ii. Revenue in respect of export sales is recognized on shipment of products.

iii. Service Income (Processing Charges) is recognized pro-rata over the period of the contract as and when services are rendered.

iv. Export incentive benefits consist of duty drawback, high value added licenses and DEPB entitlements. These are recognized on the basis of receipt of proof of export.

v. Interest is recognized on time proportion basis.

vi. Dividend Income is recognized when the right to receive the same is established.

f) Fixed Assets

Fixed Assets are stated at cost net of canvas credit less accumulated depreciation and impairment loss, if any. Cost comprises the purchase price and any attributable costs of bringing the assets to their working condition for intended use.

g) Depreciation

Depreciation on the Fixed Assets is provided to the extent of depreciable amount on the Written Down Value Method [both Tangible & Intangible]. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

h) Impairment of Assets

In accordance with AS-28 on “Impairment of Assets” notified under the relevant provisions of the Companies Act,2013.,where there is any indication of impairment of the company’s assets related to cash generating units, the carrying amounts of such assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of such assets is estimated as the higher of its net selling price and its value in use. An impairment loss is recognized whenever the carrying amount of such assets exceeds its recoverable amount. Impairment loss, if any, is recognized in the Statement of Profit and Loss.

i) Investments

Investments that are intended to be held for more than a year, from the date of acquisition, are classified as long term investments and are carried at cost. Provision for diminution in their values is made only if the diminution is other than temporary in nature. Current investments are carried at the lower of cost and quoted/fair value, computed category wise.

j) Foreign Currency Transactions

i. Transactions denominated in foreign currencies are recorded at exchange rate prevailing at the time of the transaction. Monetary items denominated in foreign currencies at Balance sheet date are restated at the year-end rates. Non Monetary foreign currency items are carried at cost.

ii. Exchange differences arising as a result of the subsequent settlements or on transactions are recognized as income or expenses in the statement of Profit & Loss except the exchange differences arising on long term foreign currency monetary items relating to the acquisition of the fixed assets, which are adjusted to the carrying cost of the assets.

k) Employee Benefits

i. Short term employee benefits are recognized as expenses at the undiscounted amounts in the Statement of profit & loss of the year in which the related service is rendered.

ii. Post employment & other Long Term Employee Benefits are recognized as an expense in the Statement of Profit & Loss for the year in which it is incurred. Post employment and other long term employee benefits are recognized as an expense in the Statement of Profit & Loss for the year in which the employee has rendered services. The expenses are recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits (net of expected return on plan assets) are charged to the Statement of Profit & Loss.

l) Taxes on Income

i. Provision for income tax (current tax) is determined on the basis of the taxable income of the current year in accordance with the Income Tax Act, 1961.

ii. Deferred tax, if any, is recognized in respect of deferred tax assets (subject to the consideration of prudence) and deferred tax liabilities on timing differences, being the difference between taxable income and accounting income that originate in one year and are capable of reversal in one or more subsequent years.

m) Borrowing Costs

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

n) Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on ‘Accounting for Employee Share-based payments’ issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognized as deferred employee compensation and is charged to the Statement of Profit and Loss on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

o) Provisions, Contingent Liabilities And Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2015

A) Basis of Preparation of Financial Statements

The Financial statements have been prepared under the historical cost convention on the accrual basis of accounting in accordance with the accounting principles generally accepted in India ("GAAP") including the Accounting Standards ("AS") notifed under the relevant provisions of the Companies Act,2013.

b) Infation

The fnancial statements are based on historical costs. These costs are not adjusted to refect the impact of the changing value of the purchasing power of money.

c) Use of Estimates

The preparation of Financial Statements in conformity with GAAP requires Management to make estimate and assumption that affect the reported amount of assets and liabilities and disclosure of contingent liabilities on the date of fnancial statements and reported amount of revenue and expenses for the year. Actual result could differ from these estimates. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized. Any revision to an accounting estimate is recognized prospectively in the year of revision.

d) Inventories

Raw Material, Packing Material, Stores and spare parts, Work-in-progress and Finished Goods are valued at cost or net realizable value whichever is lower. Cost of Raw Materials, Packing Materials and Stores & spare parts are determined on last purchase price. Work-in-progress and Finished Goods inventories include production overheads, to the extent applicable.

e) Revenue Recognition

i. Sales are recognized net of returns, trade discounts, rebates and include excise duty on manufactured products.

ii. Revenue in respect of export sales is recognized on shipment of products.

iii. Service Income (Processing Charges) is recognized pro-rata over the period of the contract as and when services are rendered.

iv. Export incentive benefts consist of duty drawback, high value added licenses and DEPB entitlements. These are recognized on the basis of receipt of proof of export.

v. Interest is recognised on time proportion basis.

vi. Dividend Income is recognised when the right to receive the same is established.

f) Fixed Assets

Fixed Assets are stated at cost net of cenvat credit less accumulated depreciation and impairment loss, if any. Cost comprises the purchase price and any attributable costs of bringing the assets to their working condition for intended use.

g) Depreciation

Depreciation on the Fixed Assets is provided to the extent of depreciable amount on the Written Down Value Method [both Tangible & Intangible]. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

h) Impairment of Assets

In accordance with AS-28 on "Impairment of Assets" notifed under the relevant provisions of the Companies Act, 2013, where there is any indication of impairment of the company's assets related to cash generating units, the carrying amounts of such assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of such assets is estimated as the higher of its net selling price and its value in use. An impairment loss is recognized whenever the carrying amount of such assets exceeds its recoverable amount. Impairment loss, if any, is recognized in the Statement of Proft and Loss.

i) Investments

Investments that are intended to be held for more than a year, from the date of acquisition, are classifed as long term investments and are carried at cost. Provision for diminution in their values is made only if the diminution is other than temporary in nature. Current investments are carried at the lower of cost and quoted/fair value, computed category wise.

j) Foreign Currency Transactions

i. Transactions denominated in foreign currencies are recorded at exchange rate prevailing at the time of the transaction. Monetary items denominated in foreign currencies at Balance sheet date are restated at the year-end rates. Non Monetary foreign currency items are carried at cost.

ii. Exchange differences arising as a result of the subsequent settlements or on transactions are recognized as income or expenses in the Statement of Proft & Loss except the exchange differences arising on long term foreign currency monetary items relating to the acquisition of the fxed assets, which are adjusted to the carrying cost of the assets.

k) Employee Benefts

i. Short term employee benefts are recognized as expenses at the undiscounted amounts in the Statement of proft & loss of the year in which the related service is rendered.

ii. Post employment & other Long Term Employee Benefts are recognized as an expense in the Statement of Proft & Loss for the year in which it is incurred. Post employment and other long term employee benefts are recognised as an expense in the Statement of Proft & Loss for the year in which the employee has rendered services. The expenses are recognised at the present value of the amounts payable determined using actuarial valuation techniques, with effect from April 2014. Actuarial gains and losses in respect of post employment and other long term benefts (net of expected return on plan assets) are charged to the Statement of Proft & Loss.

l) Taxes on Income

i. Provision for income tax (current tax) is determined on the basis of the taxable income of the current year in accordance with the Income Tax Act, 1961.

ii. Deferred tax, if any, is recognized in respect of deferred tax assets (subject to the consideration of prudence) and deferred tax liabilities on timing differences, being the difference between taxable income and accounting income that originate in one year and are capable of reversal in one or more subsequent years.

iii. Minimum Alternate Tax ('MAT') credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specifed period.

In the year in which the Company recognises 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 proft 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 be able to utilise the MAT Credit Entitlement within the period specifed under the Income-tax Act, 1961.

m) Borrowing Costs

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

n) Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on 'Accounting for Employee Share-based payments' issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognized as deferred employee compensation and is charged to the Statement of Proft and Loss on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

o) Provisions, Contingent Liabilities And Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outfow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the fnancial statements.


Mar 31, 2014

A) Basis of Preparation of Financial Statements

The Financial statements have been prepared under the historical cost convention on the accrual basis of accounting in accordance with the accounting principles generally accepted in India ("GAAP") and comply with the mandatory Accounting Standards ("AS") as notified by the companies Accounting Standard (Rules), 2006 to the extent applicable and with the relevant provisions of the Companies Act, 1956.

b) Inflation

The financial statements are based on historical costs. These costs are not adjusted to reflect the impact of the changing value of the purchasing power of money.

c) Use of Estimates

The preparation of Financial Statements in conformity with GAAP requires Management to make estimate and assumption that affect the reported amount of assets and liabilities and disclosure of contingent liabilities on the date of financial statements and reported amount of revenue and expenses for the year. Actual result could differ from these estimates. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized. Any revision to an accounting estimate is recognized prospectively in the year of revision.

d) Inventories

Raw Material, Packing Material, Stores and spare parts, Work-in-progress and Finished Goods are valued at cost or net realizable value whichever is lower. Cost of Raw Materials, Packing Materials and Stores & spare parts are determined on last purchase price. Work-in-progress and Finished Goods inventories include production overheads, to the extent applicable.

e) Revenue Recognition

i. Sales are recognized net of returns, trade discounts, rebates and include excise duty on manufactured products.

ii. Revenue in respect of export sales is recognized on shipment of products.

iii. Service Income (Processing Charges) is recognized pro-rata over the period of the contract as and when services are rendered.

iv. Export incentive benefits consist of duty drawback, high value added licenses and DEPB entitlements. These are recognized on the basis of receipt of proof of export.

v. Interest is recognised on time proportion basis.

vi. Dividend Income is recognised when the right to receive the same is established.

f) Fixed Assets

Fixed Assets are stated at cost net of cenvat credit less accumulated depreciation and impairment loss, if any. Cost comprises the purchase price and any attributable costs of bringing the assets to their working condition for intended use.

g) Depreciation

Depreciation on the Fixed Assets [both Tangible & Intangible] is provided on the Written Down Value Method at the rates and in the . manner specified in Schedule XIV to the Companies Act, 1956.

h) Impairment of Assets

In accordance with AS-28 on "Impairment of Assets" as notified by Companies (Accounting Standards) Rules, 2006, where there is any indication of impairment of the company''s assets related to cash generating units, the carrying amounts of such assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of such assets is estimated as the higher of its net selling price and its value in use. An impairment loss is recognized whenever the carrying amount of such assets exceeds its recoverable amount. Impairment loss, if any, is recognized in the Statement of Profit and Loss.

i) Investments

Investments that are intended to be held for more than a year, from the date of acquisition, are classified as long term investments and are carried at cost. Provision for diminution in their values is made only if the diminution is other than temporary in nature. Current investments are carried at the lower of cost and quoted/fair value, computed category wise.

j) Foreign Currency Transactions

i. Transactions denominated in foreign currencies are recorded at exchange rate prevailing at the time of the transaction. Monetary items denominated in foreign currencies at Balance sheet date are restated at the year-end rates. Non Monetary foreign currency items are carried at cost.

ii. Exchange differences arising as a result of the subsequent settlements or on transactions are recognized as income or expenses in the statement of Profit & Loss except the exchange differences arising on long term foreign currency monetary items relating to the acquisition of the fixed assets, which are adjusted to the carrying cost of the assets.

k) Employee Benefits .

i. Short term employee benefits are recognized as expenses at the undiscounted amounts in the Statement of profit & loss of the year in which the related service is rendered.

ii. Post employment & other Long Term Employee Benefits are recognized as an expense in the Statement of Profit & Loss for the year in which it is incurred. The company computes the liability for gratuity as per The payment of Gratuity Act, and charges it to the Statement of Profit and Loss, whenever an eligible employee retires/resigns from services. With effect from the Financial year under report, the company has provided for Gratuity Liability as per the working obtained from the LIC of India & Leave Encashment liability based on its own calculations.

l) Taxes on Income

i. Provision for income tax (current tax) is detennined on the basis of the taxable income of the current year in accordance with the Income Tax Act, 1961.

ii. Deferred tax, if any, is recognized in respect of deferred tax assets (subject to the consideration of prudence) and deferred tax liabilities on timing differences, being the difference between taxable income and accounting income that originate in one year and are capable of reversal in one or more subsequent years.

m) Borrowing Costs

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

n) Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on ''Accounting for Employee Share-based payments'' issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognized as deferred employee compensation and is charged to the Statement of Profit and Loss on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

o) Provisions, Contingent Liabilities And Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2013

A. Accounting Convention(AS -1)

The financial statements are prepared under the historical cost convention, on accrual basis of accounting, in conformity with the accounting principles generally accepted in India and comply with the accounting standards prescribed in the Companies (Accounting Standards) Rules,2006 issued by the Central Government to the extent applicable and the relevant provisions of the Companies Act, 1956.

B. Use of Estimates

The preparation of financial statements in conformity with the Generally Accepted Accounting Principles(GAAP) in India requires the Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of the financial statements and of the reported amounts of the revenues and expenses for the year. Actual results could differ from these estimates. Any revision to the accounting estimates is recognized prospectively in current and future periods.

C. Revenue Recognition (AS-9)

a) Sales which include services are recognized net of returns, trade discounts, rebates and include excise duty on manufactured products.

b) Revenue in respect of export sales is recognized on shipment of products.

c) Service Income (Processing Charges) is recognised as per contractual terms.

d) Dividend Income is recognised on receipt basis

e) Interest Income is recognised on time proportionate method.

D. Fixed Assets and Depreciation (AS-6)(AS-10)

a) Fixed Assets are stated at historical cost of acquisition/construction less accumulated depreciation and impairment loss. Cost (net of input tax credit received/receivable) includes related expenditure and pre-operative and project expenses for the period up to completion of the construction/assets are put to use.

b) Depreciation is provided on Written Down Value Method as per Section 205(2)(b), at the rates prescribed for single shift in Schedule XIV of The Companies Act, 1956.

c) Depreciation on addition/disposal of the Fixed Assets during the year is provided on prorata basis according to the period during which the assets are put to use.

E. Impairment of Assets(AS-28)

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

F. Investments (AS-13)

Current investments are carried at lower of cost and quoted/fair value, computed category wise. Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

G. Inventories (AS -2)

Raw Material, Packing Material, Stores and spare parts are valued at cost or net realizable value whichever is lower. Work-in- progress and Finished Goods inventories include production overheads, to the extent applicable. Cost of Raw Materials, Packing Materials and Stores & Spare part are determined on last purchase price.

H. Borrowing Costs(AS-16)

Borrowing Costs are recognized as an expense in the period in which they are incurred except the borrowing cost attributable to the acquisition/construction of a qualifying asset which are capitalized as part of the cost of such asset, up to the date, the assets are ready for their intended use.

I. Foreign Currency Transactions(AS-ll)

The transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction. The exchange difference resulting from settled transaction is adjusted in the profit and loss account. Year end balances of monetary items are restated at the year end exchange rates and the resultant net gain or loss is adjusted in the profit and loss account.

J. Taxation(AS-22)

Excise Duty and Value Added Tax(VAT) :- Excise Duty and VAT is accounted net of purchase tax benefit availed on purchase inputs, fixed assets and eligible service.

Taxes on Income

a) Tax expenses comprises current and deferred tax.

b) Current Tax is measured as the amount expected to be paid in accordance with the provisions of The Income Tax Act, 1961.

c) Deferred Tax reflects the impact of current year timing differences between book and tax profits and reversal of timing difference of earlier years. Deferred Tax is measured based on the tax rates and laws that have been enacted or substantially enacted as of the Balance Sheet date.

d) Deferred Tax Assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

K. Retirement Benefits (AS-15)

Contributions in respect of defined retirement schemes such as Provident Funds are charged to the Profit and loss Account as incurred. The company does not provide for gratuity as required under AS 15 accounting guidelines prescribed by Institute of Chartered Accountants of India (ICA1). However, whenever an eligible employee retires/ resigns services the company computes liability for gratuity as per payment of gratuity Act, and charges it to the profit and loss account.

L. Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on ''Accounting for Employee Share-based payments'' issued by Institute of Chartered Accountants of India (ICA1) read with Securities and Exchange Board of India (SEBl) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBL The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognised as deferred employee compensation and is charged to the Profit and Loss Account on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

M. Provisions, Contingent Liabilities and Contingent Assets (AS-29)

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

N. Earnings Per Share (AS-20)

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 on Earnings per Share. Basic earnings per share is computed by dividing the net Profit for the period by the weighted average number of Equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net Profit for the period by the number of Equity shares outstanding during the year as adjusted for the effects of all diluted potential equity shares.

O. Cash Flow Statement (AS-3)

The cash Flow Statement is prepared by the indirect method as set out in Accounting Standard 3 on Cash Flow statements and present cash flows by operating, investing & financing activities of the company.

P. Contingencies and Events occurring after the Balance sheet date (AS-4)

There have been no contingent losses after the Balance sheet date, which need to be disclosed in the financial statement. There have been no events occurring after the balance sheet date that affect the figures stated in the Financial Statements and that represent material changes and commitments affecting the financial position of the Company.


Mar 31, 2012

A. Accounting Convention

The financial statements are prepared under the historical cost convention, on accrual basis of accounting, in conformity with Ac accounting principles generally accepted in India and comply with the accounting standards prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government to the extent applicable and the relevant provisions of die Companies Act, 1956.

B. Use of Estimates

The preparation of financial statements in conformity with the Generally Accepted Accounting Principles(GAAP) in India requires the Management to make estimates and assumptions dial affect die reported amounts of assets and liabilities and die disclosures of contingent babdities on die date of die financial statements and of die reported amounts of die revenues and expenses for die year. Actual results could differ from these estimates. Any revision to die accounting estimates is recognized prospectively in current and future periods.

C. Revenue Recognition

a) Sales which include services are recognized net of returns, trade discounts, rebates and include excise duty on manufactured products.

b) Revenue in respect of export sales is recognized on shipment of products.

c) Service Income (Processing Charges) is recognised as per contractual terms.

d) Dividend Income is recognised on receipt basis

e) Interest Income is recognised on time proportionate method.

D. Fixed Assets and Depreciation

a) Fixed Assets are stated at historical cost of acquisition/construction less accumulated depreciation and impairment loss. Cost (net of input tax credit received/receivable) includes related expenditure and pre-operative and project expenses for the period up to completion of die construction/assets are put to use.

b) Depreciation is provided on Written Down Value Method as per Section 205(2Xb), at the rates prescribed for single shift in Schedule XIV ofThe Companies Act, 1956.

c) Depreciation on addition/disposal of die Fixed Assets during die year is provided on prorata basis according to the period during which die assets are put to use.

E. Impairment of Assets

An asset is treated as impaired when die carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in die year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount

E Investments

Current investments are carried at lower of cost and quoted/fair value, computed category wise. Long Term Investments are stated at cost Provision for diminution in die value of long-term investments is made only if such a decline is otiier than temporary.

G. Inventories

Raw Material, Packing Material, Stores and spare parts are valued at cost or net realizable value whichever is tower. Work-in-progress and Finished Goods inventories include production overheads, to the extent applicable. Cost of Raw Materials, Packing Materials and Stores & Spare part are determined on last purchase price.

H. Borrowing Costs

Borrowing Costs are recognized as an expense in die period in which tiiey are incurred except die borrowing cost attributable to die acquisition/ construction of a qualifying asset which are capitalized as part of die cost of such asset, up to die date, die assets are ready for their intended use.

I. Foreign Currency Transactions

The transactions in foreign currency are recorded at die exchange rates prevailing on the date of die transaction. The exchange difference resulting from settled transaction is adjusted in the profit and loss account Year end balances of monetary items are restated at the year end exchange rates and die resultant net gain or loss is adjusted in die profit and loss account

J. Taxation

Excise Duty and Value Added Tax(VAT):- Excise Duty and VAT is accounted net of purchase tax benefit availed on purchase inputs, fixed assets and eligible service.

Taxes on Income

a) Tax expenses comprises current and deferred tax.

b) Current Tax is measured as the amount expected to be paid in accordance widi die provisions of The Income Tax Act 1961.

c) Deferred Tax reflects die impact of current year timing differences between book and tax profits and reversal of timing difference of earlier years.

Deferred Tax is measured based on the tax rates and laws that have been enacted or substantially enacted as of the Balance Sheet date.

d) Deferred Tax Assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

K. Retrraaeat Benefits

Contributions m respect of defined retirement schemes such as Provident Funds are charged to the Profit and loss Account as incurred. The company does not provide for gratuity as required under AS IS accounting guidelines prescribed by Institute of Chartered Accountants of India (ICAI). However, whenever an eligible employee retires/ resigns services the company computes liability for gratuity as per payment of gratuity Act, and charges it to the profit and loss accounts subject to Note no. 2 Business Transfer.

L. Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on 'Accounting for Employee Share-based payments' issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of die stock options as on the date of grant over the exercise price of the options is recognised as deferred employee compensation and is charged to the Profit and Loss Account on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

M. Provisions, Coalingf t Liabilities and Contingent Assets

Provisions involving sabstanual degree of estimation in measurement are recognized when tiiere is a present obligation as a result of past events and it is probable that mere wiH be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in die financial statements.

N. Earning! Per Share

The Company reports basic and diluted earnings per share in acc^rdaiK* with Acccounting Standard 20 on Earnings per Share. Basic earnings per share is computed by dividing the net Profit for the period by the weighted average number of Equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net Profit for the period by uk number of Equity shares outstanding during the year as adjusted for the effects of ail diluted potential equity shares.

O. Cash Flow Statement

The cash Flow Statement is prepared by die indirect method as set out in Accounting Standard 3 on Cash Flow statements and present cash flows by operating, investing A financing activities of the company.

P. Proposed Dnidead

Special Interim Dividend as recommended by the Board is provided in the Accounts. Further, the Board do not recommend any additional dividend for the financial year 2011-2012 and hence die said Special Interim Dividend be considered as the Final Dividend.


Mar 31, 2011

1) Accounting Convention

The financial statements are prepared under the historical cost convention, on accrual basis of accounting, in conformity with the accounting principles generally accepted in India and comply with the accounting standards prescribed in the Companies (Accounting Standards) Rules,2006 issued by the Central Government to the extent applicable and the relevant provisions of the Companies Act, 1956.

2) Use of Estimates

The preparation of financial statements in conformity with the Generally Accepted Accounting Principles(GAAP) in India requires the Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of the financial statements and of the reported amounts of the revenues and expenses for the year. Actual results could differ from these estimates. Any revision to the accounting estimates is recognized prospectively in current and future periods.

3) Revenue Recognition

a) Sales are recognized on completion of sale of goods and are recorded net of trade discounts, rebates, and excise duty on own manufactured products.

b) Revenue in respect of export sales is recognized on shipment of products.

c) Service Income (Processing Charges) is recognised as per contractual terms.

d) Dividend Income is recognised on receipt basis

e) Interest Income is recognised on time proportionate method.

4) Fixed Assets and Depreciation

a) Fixed Assets are stated at historical cost of acquisition/construction less accumulated depreciation and impairment loss. Cost (net of input tax credit received/receivable) includes related expenditure and pre-operative and project expenses for the period up to completion of the construction/assets are put to use.

b) Depreciation is provided on Written Down Value Method as per Section 205(2Xb), at the rates prescribed for single shift in Schedule XIV of The Companies Act, 1956.

c) Depreciation on addition/disposal of the Fixed Assets during the year is provided on prorata basis according to the period during which the assets are put to use.

d) The expenditure incidental to the expansion are allocated to Fixed Assets in the year of commencement of the commercial production.

5) Investments Investments are valued at cost.

6) Inventories

a) Raw Material, Packing Material, Stores and spare parts are valued at cost or net realisable value whichever is lower.

b) Work-in-progress and Finished Goods inventories include production overheads, to the extent applicable

c) Cost of Raw Materials, Packing Materials and Stores & Spare part are determined on last purchase price.

7) Miscellaneous Expenditure

Miscellaneous Expenditure is written off on a straight-line basis over a period of five years. -

8) Borrowing Costs

Borrowing Costs are recognized as an expense in the period in which they are incurred except the borrowing cost attributable to the acquisition/ construction of a qualifying asset which are capitalized as part of the cost of such asset, up to the date, the assets are ready for their intended use.

9) Foreign Currency Transactions

The transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction. The exchange difference resulting from settled transaction is adjusted in the profit and loss account. Year end balances of monetary items are restated at the year end exchange rates and the resultant net gain or loss is adjusted in the profit and loss account.

10) Taxation

a) Excise Duty :- Excise Duty is accounted net of Cenvat benefit availed on purchase inputs, fixed assets and eligible services

b) Value Added Tax |VAT| :- VAT is accounted net of VAT paid on purchases and Fixed Assets.

11) Taxes on Income

a) Tax expenses comprises current and deferred tax.

b) Current Tax is measured as the amount expected to be paid in accordance with the provisions of The Income Tax Act. 1961.

c) Deferred Tax reflects the impact of current year timing differences between book and tax profits and reversal of timing difference of earlier years. Deferred Tax is measured based on the tax rates and laws that have been enacted or substantially enacted as of the Balance Sheet date.

d) Deferred Tax Assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred lax assets can be realized.

12) Retirement Benefits

Contributions in respect of defined retirement schemes such as Provident Funds are charged to the Profit and loss Account as incurred. The company does not provide for gratuity as required under AS 15 accounting guidelines prescribed by Institute of Chartered Accountants of India (ICAI). However, whenever an eligible employee retires / resigns services the company computes liability for gratuity as per payment of gratuity Act, and charges it to the profit and loss accounts.

13) Employee Stock Option Plan

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on 'Accounting for Employee Share-based payments' issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognised as deferred employee compensation and is charged to the Profit and Loss Account on vesting basis over the vesting period of the options. The un-amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

14) Earnings Per Share:

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 on Earnings per Share. Basic earnings per share is computed by dividing the net Profit for the period by the weighted average number of Equity shares outstanding during the period, as adjusted for the effects of all diluted potential equity shares.. Diluted earnings per share is computed by dividing the net Profit for the period by the number of Equity shares outstanding during the year.

15) Cash Flow Statement:

The cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow statements and present cash flows by operating, investing & financing activities of the company.

16) Proposed Dividend:

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


Mar 31, 2010

1) Accounting Convention

The financial statements are prepared under the historical cost convention, on accrual basis of accounting, in conformity with the accounting principles generally accepted in India and comply with the accounting standards referred to in section 211(3C) of the Companies Act, 1956.

2) Revenue Recognition

a) Sales are recognized on completion of sale of goods and are recorded net of trade discounts, rebates, and excise duty on own manufactured products.

b) Revenue in respect of export sales is recognized on shipment of products.

c) Service Income (Processing Charges) is recognised as per contractual terms.

d) Dividend Income is recognised on receipt basis

e) Interest Income is recognised on time proportionate method.

3) Fixed Assets and Depreciation

a) Fixed Assets are stated at historical cost of acquisition/construction less accumulated depreciation and impairment loss. Cost (net of input tax credit received/receivable) includes related expenditure and pre-operative and project expenses for the period up to completion of the construction/assets are put to use.

b) Depreciation is provided on Written Down Value Method as per Section 205(2)(b), at the rates prescribed ixsr single shift in Schedule XIV of The Companies Act, 1956.

c) Depreciation on addition/disposal of the Fixed Assets during the year is provided on prorata basis according w the period during which the assets are put to use.

4) Investments

Investments are valued at cost.

5) Inventories

a) Raw Material, Packing Material, Stores and spare parts are valued at cost or net realisable value whichever is lower.

b) Work-in-process and Finished Goods inventories include production overheads, to the extend applicable

6) Miscellaneous Expenditure

Miscellaneous Expenditure is written off on a straight-line basis over a period of five years.

7) Borrowing Costs

Borrowing Costs are recognized as an expense in the period in which they are incurred except the borrowing cost attributable to the acquisition/ construction of a qualifying asset which are capitalized as part of the cost of such asset, up to the date, the assets are ready for their intended use..

8) Foreign Currency Transactions

The transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction. The exchange difference resulting from settled transaction is adjusted in the profit and loss account. Year end balances of monetary items are restated at the year end exchange rates and the resultant net gain or loss is adjusted in the profit and loss accounts

9) Taxation

a) Excise Duty :- Excise Duty is accounted net of Cenvat benefit availed on purchases inputs, fixed assets and eligible services

b) Value Added Tax [VAT| :- VAT is accounted net of VAT paid on purchases and Fixed Assets.

10) Income Tax

a) Tax expenses comprises current and deferred tax.

b) Current Tax is measured as the amount expected to be paid in accordance with the provisions of The Income Tax Act, 1961.

c) Deferred Tax reflects the impact of current year timing differences between book and tax profits and reversal of timing difference of earlier years. Deferred Tax is measured based on the tax rates and laws that have been enacted or substantially enacted as of the Balance Sheet date.

d) Deferred Tax Assets are recognised only to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

11) Retirement Benefits

Contributions in respect of defined retirement schemes such as Provident Funds are charged to the Profit and loss Account as incurred. The company does not provide for gratuity as required under AS 15 accounting guidelines prescribed by ICAI. However, whenever an digibale employee retires / resign services the company computes liability for gratuity as per payment of gratuity Act, and charges il to the profit and loss account.

12) Employee Stock Option Scheme

Employee Stock Options are evaluated and accounted on intrinsic value method as per the accounting treatment prescribed by Guidance Note on Accounting for Employee Share-based payments issued by Institute of Chartered Accountants of India (ICAI) read with Securities and Exchange Board of India (SEBI) (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 issued by SEBI. The excess of market value if any, of the stock options as on the date of grant over the exercise price of the options is recognised as deferred employee compensation and is charged to the Profit and Loss Account on vesting basis over the vesting period of the options. The un- amortized portion of the deferred employee compensation is reduced from Employee Stock Option Outstanding, which is shown under Reserves and Surplus.

13) Earnings Per Share:

The Company reports basic and diluted earnings per share in accordance with Accounting Standard 20 on Earnings per Share- Basic earnings per share is computed by dividing the net Profit for the period by the weighted average number of Equity shares outstanding during the period, as adjusted for the effects of all diluted potential equity shares. Diluted earnings per share is computed by dividing the net Profit for the period by the number of Equity shares outstanding during the year.

14) Cash Flow Statement:

The cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow statements and present cash flows by operating, investing & financing activities of the company.

15) Group / Classification

Previous years figures have been regrouped and "or" reclassified wherever necessary to conform to current years figures and classification.

16) Figures in bracket indicate previous year figures.

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