Mar 31, 2018
1 Summery of Significant accounting policies
Significant accounting policies adopted by the company are as under:
1.1 Basis of Preparation of Financial Statements
(a) Statement of Compliance with Ind AS
These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the âActâ) read with the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.
The financial statements up to year ended 31 March 2017 were prepared in accordance with the accounting standards notified under the section 133 of the Act, read with with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).
These financial statements for the year ended 31 March 2018 are the first set of financial statements prepared in accordance with Ind AS. Refer note 35 for an explanation of how the Company has adopted Ind AS.
Accounting policies have been consistently applied to all the years presented except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
(b) Basis of measurement
The financial statements have been prepared on a historical cost convention on accrual basis, except certain financial assets and liabilities measured at fair value.
(c) Use of estimates
The preparation of financial statements in conformity with Ind AS requires the management to make estimate and assumptions that affect the reported amount of assets and liabilities as at the Balance Sheet date, reported amount of revenue and expenses for the year and disclosures of contingent liabilities as at the Balance Sheet date. The estimates and assumptions used in the accompanying financial statements are based upon the managementâs evaluation of the relevant facts and circumstances as at the date of the financial statements. Actual results could differ from these estimates. Estimates and underlying assumptions are reviewed on a periodic basis. Revisions to accounting estimates, if any, are recognized in the year in which the estimates are revised and in any future years affected.
1.2 Property, plant and equipment
Property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Subsequent costs are included in the assetâs carrying amount or recognized 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 derecognized when replaced. All other repairs and maintenance are charged to Statement of Profit and Loss during the year in which they are incurred.
Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under âCapital work-in-progress.
Transition to Ind AS
On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment recognized as at 1 April 2016 measured as per the Indian GAAP and use that carrying value as the deemed cost of the property, plant and equipment.
Depreciation methods, estimated useful lives
The Company depreciates property, plant and equipment over their estimated useful lives using the straight line method. The estimated useful lives of assets are taken as prescribed useful lives under Schedule II to the Companies Act, 2013. The management believes that such estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.
Depreciation on addition to property plant and equipment is provided on pro-rata basis from the date of acquisition. Depreciation on sale/deduction from property plant and equipment is provided up to the date preceding the date of sale, deduction as the case may be. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in Statement of Profit and Loss under âOther Incomeâ.
1.3 Investment properties
Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.
1.4 Intangible Assets
Intangible assets are stated at acquisition cost, net of accumulated amortization.
Transition to Ind AS
On transition to Ind AS, the Company has elected to continue with the carrying value of all of its all intangible assets recognised as at April 1, 2016 measured as per the Indian GAAP and use that carrying value as the deemed cost of the intangible assets.
The Company has amortized intangible assets over their estimated useful lives using the straight line method. The estimated useful lives of intangible asset is 10 years.
1.5 Borrowing cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs.
1.6 Foreign Currency Transactions
(a) Functional and presentation currency
Items included in the financial statements are measured using the currency of the primary economic environment in which the entity operates (âthe functional currencyâ). The financial statements are presented in Indian rupee (INR), which is the Companyâs functional and presentation currency.
(b) Transactions and balances
On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/ Losses arising out of fluctuation in foreign exchange rate between the transaction date and settlement date are recognised in the Statement of Profit and Loss.
All monetary assets and liabilities in foreign currencies are restated at the year end at the exchange rate prevailing at the year end and the exchange differences are recognised in the Statement of Profit and Loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.
1.7 Financial Instruments.
Fair value measurement
The Company has valued financial assets and Financial Liabilities, at fair value. Impact of fair value changes as on date of transition, is recognised in opening reserves and changes there after are recognised in Statement of Profit and Loss Account or Other Comprehensive Income, as the case may be.
Financial Assets
The company classifies its financial assets as those to be measured subsequently at fair value ( either through other comprehensive income or through Profit or loss) and those to be measured at amortised cost.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable to transaction costs.
1.8 Revenue Recognition
Revenue is recognised when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the companys activities as described below:
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of trade allowances, rebates and amounts collected on behalf of third parties and is not recognised in instances where there is uncertainty with regard to ultimate collection. In such cases revenue is recognised on reasonable certainty of collection.
Sale of products:
Revenue from sale of products is recognised when significant risks and rewards in respect of ownership of products are transferred to customers based on the terms of sale. Revenue from sales is based on the price specified in the sales contracts, net of all discounts, returns and goods and service tax at the time of sale.
1.9 Taxes
Tax expense for the year, comprising current tax and deferred tax, are included in the determination of the net profit or loss for the year.
(a) Current income tax
Current tax assets and liabilities are measured at the amount expected to be recovered or paid to the taxation authorities in accordance with the relevant prevailing tax laws. Tax expenses relating to the items in profit & loss account shall be treated as current tax as part of profit and loss and those relating to items in other comprehensive income shall be recognised as part of OCI.
(b) Deferred tax
Deferred income tax is recognised for all the temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in financial statements. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the year and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.At each balance sheet, the company re-assesses unrecognised deferred tax asets, if any, and the same is recognised to the extent it has become probable that future taxable profit will allow the deffered tax asset to be recovered. Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority.
1.10 Assets classified as held for sale
The Company classifies non-current assets (or disposal group) as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use.
Non-current assets (or disposal group) held for sale are measured at the lower of their carrying amount and the fair value less costs to sell. Assets and liabilities (or disposal group) classified as held for sale are presented separately in the balance sheet.
Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortized.
1.11 Leases
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as a lessee are shown as other non current assets . Payments made under operating leases (net of any incentives received from the lesser) are charged to Statement of Profit and Loss on a straight-line basis over the period of the lease .
1.12 Inventories
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition are accounted for as follows:
Raw materials, finished goods, semi finished goods, trading goods and stores and spare parts are valued at lower of cost and net realizable value. Cost includes purchase price, (excluding taxes those subsequently recoverable by the enterprise from the concerned revenue authorities), freight inwards and other expenditure incurred in bringing such inventories to their present location and condition. Fent, rags and rejections are stated at net realisable value. In determining the cost, FIFO method is used.
1.13 Impairment of assets
The carrying value of assets / cash generating units at the Balance Sheet date are reviewed for impairment, if any indication of impairment exists. If the carrying amount of the assets exceed the estimated recoverable amount, an impairment is recognised for such excess amount. The impairment loss is recognied for such excess amount.
1.14 Provisions and contingent liabilities
Provisions are recognized when there is a present obligation 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 there is a reliable estimate of the amount of the obligation. Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the Balance sheet date.If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
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.
1.15 Cash and cash equivalents
Cash and cash equivalent in the balance sheet comprise cash at banks, cash on hand and short-term deposits net of bank overdraft with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purposes of the cash flow statement, cash and cash equivalents include cash on hand, cash in banks and shortterm deposits net of bank overdraft.
1.16 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
(a) Financial assets
(i) Initial recognition and measurement
At initial recognition, financial asset is measured at its fair value plus, in the case of a financial asset not at fair value through profit or loss, 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 profit or loss.
(ii) Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in following categories:
a) at amortized cost; or
b) at fair value through other comprehensive income; or
c) at fair value through profit or loss.
The classification depends on the entityâs business model for managing the financial assets and the contractual terms of the cash flows.
(iii) Impairment of financial assets
The company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments.the impairment methodology applied depends on whether there has been a significant increase in credit risk.
(iv) Derecognition of financial assets
A financial asset is derecognized only when
a) the rights to receive cash flows from the financial asset is transferred or
b) retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.
Where the financial asset is transferred then in that case financial asset is derecognized only if substantially all risks and rewards of ownership of the financial asset is transferred. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.
(b) Financial liabilities
(i) Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss and at amortized cost, as appropriate.
(ii) Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on liabilities held for trading are recognized in the Statement of Profit and Loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost. Gains and losses are recognized in Statement of Profit and Loss when the liabilities are derecognized.
(iii) Derecognition
A financial liability is derecognized 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 recognized in the Statement of Profit and Loss as finance costs.
1.17 Employee Benefits
(a) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the year in which the employees render the related service are recognized in respect of employeesâ services up to the end of the year and are measured at the amounts expected to be paid when the liabilities are settled.
(b) Other long-term employee benefit obligations
(i) Defined contribution plan
Provident Fund: Contribution towards provident fund is made to the regulatory authorities, where the Company has no further obligations, apart from the contributions made on a monthly basis which are charged to the Statement of Profit and Loss.
Employeeâs State Insurance Scheme: Contribution towards employeesâ state insurance scheme is made to the regulatory authorities, where the Company has no further obligations apart from the contributions made on a monthly basis which are charged to the Statement of Profit and Loss.
(ii) Defined benefit plans
Gratuity: The Company provides for gratuity, a defined benefit plan (the âGratuity Planâ) covering eligible employees in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employeeâs salary. The Companyâs liability is actuarially at the end of each year. Actuarial losses/gains are recognized in the other comprehensive income in the year in which they arise.
1.18 Earnings Per Share
Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. Earnings considered in ascertaining the Companyâs earnings per share is the net profit or loss for the year after deducting preference dividends and any attributable tax thereto for the year, if any. The weighted average number of equity shares outstanding during the year and for all the years presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year is adjusted for the effects of all dilutive potential equity shares.
1.19 Research & Development
Expenditure on research and development is recognised as an expense when it is incurred. Expenditure which results in increase in property, plant and equipment are capitalised and depreciated in accordance with the policies stated for property, plant & equipment.
1.20 Government grants
Grants from the government are recogmised at their fair value where there is a reasonable assurance that the grant will be received and the company will comply with all the attached conditions.All government grants are intially recognised by way of setting up as deferred income. Government grants relating to income are recognised in the profit & loss account . Government grants relating to purchase of property, plant & equipment are subsequently recognised in profit & loss on a systematic basis over the expected life of the related depreciable assets. Grants recognised in Profit & Loss as above are presented within other income.
1.21 Inter divisional transcations
Inter divisional transcations are eliminated as contra items. Any unrealised profits on unsold stocks on account of inter divisional transcations is eliminated while valuing the inventory.
1.22 Significant accounting judgments, estimates and assumptions
The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. 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 years.
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the year end date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. 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.
(a) Taxes
Significant assumptions and judgements are involved in determining the provision for tax based on tax enactments, relevant judicial pronuncements including an estimation of the likely outcome of any open tax assements/ litigations. Deferred income tax assets are recognised to the extent that it is probable that future taxable income will be available , based on estimates thereof.
(b) Defined benefit plans (gratuity benefits and leave encashment)
The cost of the defined benefit plans such as gratuity and leave encashment 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, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each year end.
Mar 31, 2016
1 Basis of Accounting :
The financial statements are prepared in accordance with relevant accounting standards under the historical cost convention on accrual basis and as a going concern with revenues considered and expenses accounted for wherever possible on their accrual. The accounting policies are consistent with those used in the previous year.
2 Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting year. Although these estimates are based on managementâs best knowledge of current events and actions, actual result could differ from these estimates.
3 Fixed Assets :
a. Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost comprises the purchase price and any attributable cost of bringing assets to its working condition for its intended use. Borrowing cost relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.
b. Expenditure during the construction period (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as pre-operative Expenses, pending allocation to the assets and are included under âCapital Work in Progressâ. These expenses are apportioned to fixed assets on commencement of commercial production.
4 Depreciation :
Depreciation has been provided based on life assigned to each asset in accordance with Schedule II of the Companies Act, 2013.
5 Inventories :
Raw materials, finished goods, semi finished goods, trading goods and stores and spares are stated at cost or net realizable value whichever is lower. Fent, rags and rejections are stated at net realizable value. The cost of inventories is computed on FIFO basis.
6 Investments:
Investments of the Company are long-term. The same are valued at the cost of acquisition. Decline in the value of permanent nature is provided as per accounting standard AS 13. Dividend of investments is accounted for as and when received.
7 Revenue Recognition :
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The Company recognize sales of goods on transferring property of underlying goods to customers. Sales include all charges and duties collected. Export benefits in respect of exports made have been accounted on accrual basis.
8 Excise/Custom Duty :
The liability for excise and custom duty in respect of material lying in the factory/bonded premises is accounted for as and when they are cleared/deboned.
9 Foreign Currency Transactions :
(a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of of the transaction or that approximates the actual rate at the date of the transaction.
(b) Monetary items denominated in foreign currencies at the year end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the yearend rate and rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.
(c) Non Monetary foreign currency items are carried at cost.
(d) Any income or expense on account of exchange difference either on settlement or on translation is recognized in Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.
10 Borrowing Costs :
Borrowing costs directly attributable to the acquisition or construction of fixed assets are capitalized as part of the cost of the assets up to the date the asset is put to use. Other borrowing costs are charged to the Profit & Loss Account in the year in which they are incurred.
11 Research and Development :
Revenue expenditure, including overheads on Research and Development is charged out as an expense through the natural heads of account in the year in which incurred.
Expenditure which results in the dreation of capital assets is taken as Fixed Assets and depreciation is provided on such assets as are depreciable.
12 Government Grants :
Grants received against specific fixed assets are adjusted to the cost of the assets and those in the nature of promoterâs contribution are credited to Capital Reserve. Revenue Grants are recognized in the Profit and Loss Account in accordance with the related scheme and in the period in which these are accrued.
13 Retirement Benefits :
The liability for gratuity has been provided on the basis of actuarial valuation carried out by an independent actuary as at Balance Sheet date. In respect of Provident Fund contributions paid regularly to the government and is charged to revenue. The provision for leave encashment is made for accumulated leaves that employees can encash in future.
14 Taxes on Income :
Provision for current tax is made based on the tax liability computed after considering tax allowances and deductions. Deferred tax resulting from timing difference between taxable income and accounting income is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.
15 Earning Per Share
The earning considered in ascertaining the companyâs earnings per share comprises the net profit after tax (and includes the post tax effect of any extraordinary items). The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year.
16 Impairment of Assets
The carrying amount of assets is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exist, the recoverable amount of the assets is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating units exceeds its recoverable amount. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and recognized in compliance with AS-28.
17 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.
18 Inter Divisional Transactions :
Inter divisional transactions are eliminated as contra items. Any unrealized profits on unsold stocks on account of inter divisional transactions is eliminated while valuing the inventory.
Mar 31, 2015
1 Basis of Accounting :
The financial statements are prepared in accordance with relevant
accounting standards under the historical cost convention on accrual
basis and as a going concern with revenues considered and expenses
accounted for wherever possible on their accrual. The accounting
policies are consistent with those used in the previous year.
2 Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of
financial statements and the results of operations during the reporting
year. Although these estimates are based on management's best knowledge
of current events and actions, actual result could differ from these
estimates.
3 Fixed Assets :
a. Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. The cost comprises the purchase price and
any attributable cost of bringing assets to its working condition for
its intended use. Borrowing cost relating to acquisition of fixed
assets which takes substantial period of time to get ready for its
intended use are also included to the extent they relate to the period
till such assets are ready to be put to use.
b. Expenditure during the construction period (including financing cost
relating to borrowed funds for construction or acquisition of fixed
assets) incurred on projects under implementation are treated as
pre-operative Expenses, pending allocation to the assets and are
included under "Capital Work in Progress". These expenses are
apportioned to fixed assets on commencement of commercial production.
4 Depreciation :
Depreciation has been provided based on life assigned to each asset in
accordance with Schedule II of the Companies Act, 2013.
5 Inventories :
Raw materials, finished goods, semi finished goods, trading goods and
stores and spares are stated at cost or net realisable value whichever
is lower. Fent, rags and rejections are stated at net realisable value.
The cost of inventories is computed on FIFO basis.
6 Investments:
Investments of the Company are long-term. The same are valued at the
cost of acquisition. Decline in the value of permanent nature is
provided as per accounting standard AS 13. Dividend of investments is
accounted for as and when received.
7 Revenue Recognition :
Revenue is recoginised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured. The Company recognise sales of goods on transfering
property of undelying goods to customers. Sales include all charges and
duties collected. Export benefits in respect of exports made have been
accounted on accrual basis.
8 Excise/Custom Duty :
The liability for excise and custom duty in respect of material lying
in the factory/bonded premises is accounted for as and when they are
cleared/debonded.
9 Foreign Currency Transactions :
(a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of of the transaction or that
approximates the actual rate at the date of the transaction.
(b) Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognised as exchange
difference and the premium paid on forward contracts is recognised over
the life of the contract.
(c) Non Monetary foreign currency items are carried at cost.
(d) Any income or expense on account of exchange difference either on
settlement or on translation is recognised in Profit & Loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in which case they are adjusted to the carrying cost of
such assets.
10 Borrowing Costs:
Borrowing costs directly attributable to the acquisition or
construction of fixed assets are capitalised as part of the cost of the
assets upto the date the asset is put to use. Other borrowing costs are
charged to the Profit & Loss Account in the year in which they are
incurred.
11 Research and Development:
Revenue expendutire, including overheads on Research and Development is
charged out as an expense through the natural heads of account in the
year in which incurred. Expenditure which results in the dreation of
capital assets is taken as Fixed Assets and depreciation is provided on
such assets as are depreciable.
12 Government Grants:
Grants received against specific fixed assets are adjusted to the cost
of the assets and those in the nature of promoter's contribution are
credited to Capital Reserve. Revenue Grants are recognised in the
Profit and Loss Account in accordance with the related scheme and in
the period in which these are accured.
13 Retirement Benefits:
The liability for gratuity has been provided on the basis of actuarial
valuation carried out by an independent actuary as at Balance Sheet
date. In respect of Provident Fund contributions paid regularly to the
government and is charged to revenue. The provision for leave
encashment is made for accumulated leaves that employees can encash in
future.
14 Taxes on Income:
Provision for current tax is made based on the tax liability computed
after considering tax allowances and deductions. Deferred tax resulting
from timing difference between taxable income and accounting income is
accounted for using the tax rates and laws that have been enacted or
substantively enacted as on the balance sheet date. The deferred tax
asset is recognised and carried forward only to the extent that there
is a reasonable certainty that the asset will be realised in future.
15 Earning Per Share:
The earning considered in ascertaining the company's earning per share
comprises the net profit after tax (and includes the post tax effect of
any extraordinary items). The number of shares used in computing basic
earning per share is the weighted average number of shares outstanding
during the year.
16 Impairment of Assets:
The carrying amount of assets is reviewed at each balance sheet date to
determine whether there is any indication of impairment. If any such
indication exist, the recoverable amount of the assets is estimated. An
impairment loss is recognised whenever the carrying amount of an asset
or its cash generating units exceeds its recoverable amount. An
impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount and recognised in compliance
with AS-28.
17 Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised 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 recognised nor disclosed in the
financial statements.
18 Inter Divisional Transactions:
Inter divisional transactions are eliminated as contra items. Any
unrealised profits on unsold stocks on account of inter divisional
transactions is eliminated while valuing the inventoy.
Mar 31, 2014
1. Basis of Accounting :
The financial statements are prepared in accordance with relevant
accounting standards under the historical cost convention on accrual
basis and as a going concern with revenues considered and expenses
accounted for wherever possible on their accrual. The accounting
policies are consistent with those used in the previous year.
2. Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of
financial statements and the results of operations during the reporting
year. Although these estimates are based on management''s best knowledge
of current events and actions, actual result could differ from these
estimates.
3. Fixed Assets:
(a) Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. The cost comprises the purchase price and
any attributable cost of bringing assets to its working condition for
its intended use. Borrowing cost relating to acquisition of fixed
assets which takes substantial period of time to get ready for its
intended use are also included to the extent they relate to the period
till such assets are ready to be put to use.
(b) Expenditure during the construction period (including financing
cost relating to borrowed funds for construction or acquisition of
fixed assets) incurred on projects under implementation are treated as
pre-operative Expenses, pending allocation to the assets and are
included under "Capital Work in Progress". These expenses are
apportioned to fixed assets on commencement of commercial production.
4. Depreciation :
Depreciation on fixed assets is provided on the basis of straight line
method at the rates prescribed in Schedule-XIV of the Companies Act,
1956 on pro rata basis. The management of the Company is of the view
that these depreciation rates fairly represent the useful life of
assets. The leasehold land is amortized on straighline basis over the
initial period of lease.
5. Inventories :
Raw materials, finished goods, semi finished goods, trading goods and
stores and spares are stated at cost or net realisable value whichever
is lower. Fent, rags and rejections are stated at net realisable value.
The cost of inventories is computed on FIFO basis.
6. Investments:
Investments of the Company are long-term. The same are valued at the
cost of acquisition. Decline in the value of permanent nature is
provided as per accounting standard AS 13. Dividend of investments is
accounted for as and when received.
7. Revenue Recognition :
Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured. The Company recognise sales of goods on transferring
property of undelying goods to customers. Sales include all charges
and duties collected. Export benefits in respect of exports made have
been accounted on accrual basis.
8. Excise/Custom Duty :
The liability for excise and custom duty in respect of material lying
in the factory/bonded premises is accounted for as and when they are
cleared/debonded.
9. Foreign Currency Transactions :
(a) Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of of the transaction or that
approximates the actual rate at the date of the transaction.
(b) Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognised as exchange
difference and the premium paid on forward contracts is recognised over
the life of the contract.
(c) Non Monetary foreign currency items are carried at cost.
(d) Any income or expense on account of exchange difference either on
settlement or on translation is recognised in Profit & Loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in which case they are adjusted to the carrying cost of
such assets.
10. Borrowing Costs:
Borrowing costs directly attributable to the acquisition or
construction of fixed assets are capitalised as part of the cost of the
assets upto the date the asset is put to use. Other borrowing costs are
charged to the Profit & Loss Account in the year in which they are
incurred.
11. Research and Development:
Revenue expendutire, including overheads on Research and Development is
charged out as an expense through the natural heads of account in the
year in which incurred. Expenditure which results in the deration of
capital assets is taken as Fixed Assets and depreciation is provided on
such assets as are depreciable.
12. Government Grants:
Grants received against specific fixed assets are adjusted to the cost
of the assets and those in the nature of promoter''s contribution are
credited to Capital Reserve. Revenue Grants are recognised in the
Profit and Loss Account in accordance with the related scheme and in
the period in which these are accured.
13. Retirement Benefits:
The liability for gratuity has been provided on the basis of actuarial
valuation carried out by an independent actuary as at Balance Sheet
date. In respect of Provident Fund contributions paid regularly to the
government and is charged to revenue.
The provision for leave encashment is made for accumulated leaves that
employees can encash in future.
14. Taxes on Income:
Provision for current tax is made based on the tax liability computed
after considering tax allowances and deductions. Deferred tax resulting
from timing difference between taxable income and accounting income is
accounted for using the tax rates and laws that have been enacted or
substantively enacted as on the balance sheet date. The deferred tax
asset is recognised and carried forward only to the extent that there
is a reasonable certainty that the asset will be realised in future.
15. Earning Per Share:
The earning considered in ascertaining the company''s earning per share
comprises the net profit after tax (and includes the post tax effect of
any extraordinary items). The number of shares used in computing basic
earning per share is the weighted average number of shares outstanding
during the year.
16. Impairment of Assets:
The carrying amount of assets is reviewed at each balance sheet date to
determine whether there is any indication of impairment. If any such
indication exist, the recoverable amount of the assets is estimated. An
impairment loss is recognised whenever the carrying amount of an asset
or its cash generating units exceeds its recoverable amount. An
impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount and recognised in compliance
with AS-28.
17. Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised 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 recognised nor disclosed in the
financial statements.
18. Inter Divisional Transactions:
Inter divisional transactions are eliminated as contra items. Any
unrealised profits on unsold stocks on account of inter divisional
transactions is eliminated while valuing the inventory.
Mar 31, 2012
1. Basis of Accounting :
The financial statements are prepared in accordance with relevant
accounting standards under the historical cost convention on accrual
basis and as a going concern with revenues considered and expenses
accounted for wherever possible on their accrual. The accounting
policies are consistent with those used in the previous year.
2. Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of
financial statements and the results of operations during the reporting
year. Although these estimates are based on management's best knowledge
of current events and actions, actual result could differ from these
estimates.
3. Fixed Assets :
a. Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. The cost comprises the purchase price and
any attributable cost of bringing assets to its working condition for
its intended use. Borrowing cost relating to acquisition of fixed
assets which takes substantial period of time to get ready for its
intended use are also included to the extent they relate to the period
till such assets are ready to be put to use.
b. Expenditure during the construction period (including financing
cost relating to borrowed funds for construction or acquisition of
fixed assets) incurred on projects under implementation are treated as
pre-operative Expenses, pending allocation to the assets and are
included under "Capital Work in Progress". These expenses are
apportioned to fixed assets on commencement of commercial production.
4. Depreciation :
Depreciation on fixed assets is provided on the basis of straight line
method at the rates prescribed in Schedule-XIV of the Companies Act,
1956 on pro rata basis. The management of the Company is of the view
that these depreciation rates fairly represent the useful life of
assets. The leasehold land is amortized on straighline basis over the
initial period of lease.
5. Inventories :
Raw materials, finished goods, semi finished goods, trading goods and
stores and spares are stated at cost or net realisable value whichever
is lower. Fent, rags and rejections are stated at net realisable value.
The cost of inventories is computed on FIFO basis.
6. Investments:
Investments of the Company are long-term. The same are valued at the
cost of acquisition. Decline in the value of permanent nature is
provided as per accounting standard AS 13. Dividend of investments is
accounted for as and when received.
7. Revenue Recognition :
Revenue is recoginised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured. The Company recognise sales of goods on transfering
property of undelying goods to customers. Sales include all charges and
duties collected. Export benefits in respect of exports made have been
accounted on accrual basis.
8. Excise/Custom Duty :
The liability for excise and custom duty in respect of material lying
in the factory/bonded premises is accounted for as and when they are
cleared/debonded.
9. Foreign Currency Transactions :
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of of the transaction or that
approximates the actual rate at the date of the transaction.
Monetary items denominated in foreign currencies at the year end are
restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognised as
b. exchange difference and the premium paid on forward contracts is
recognised over the life of the contract.
c. Non Monetary foreign currency items are carried at cost.
d. Any income or expense on account of exchange difference either on
settlement or on translation is recognised in Profit & Loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in which case they are adjusted to the carrying cost of
such assets.
10. Borrowing Costs:
Borrowing costs directly attributable to the acquisition or
construction of fixed assets are capitalised as part of the cost of the
assets upto the date the asset is put to use. Other borrowing costs are
charged to the Profit & Loss Account in the year in which they are
incurred.
11. Research and Development:
Revenue expendutire, including overheads on Research and Development is
charged out as an expense through the natural heads of account in the
year in which incurred. Expenditure which results in the dreation of
capital assets is taken as Fixed Assets and depreciation is provided on
such assets as are depreciable.
12. Government Grants:
Grants received against specific fixed assets are adjusted to the cost
of the assets and those in the nature of promoter's contribution are
credited to Capital Reserve. Revenue Grants are recognised in the
Profit and Loss Account in accordance with the related scheme and in
the period in which these are accured.
13. Retirement Benefits:
The liability for gratuity has been provided on the basis of actuarial
valuation carried out by by an independent actuary as at Balance Sheet
date. In respect of Provident Fund contributions paid regularly to the
government and is charged to revenue. The provision for leave
encashment is made for accumulated leaves that employees can encash in
future.
14. Taxes on Income:
Provision for current tax is made based on the tax liability computed
after considering tax allowances and deductions. Deferred tax resulting
from timing difference between taxable income and accounting income is
accounted for using the tax rates and laws that have been enacted or
substantively enacted as on the balance sheet date. The deferred tax
asset is recognised and carried forward only to the extent that there
is a reasonable certainty that the asset will be realised in future.
15. Earning Per Share:
The earning considered in ascertaining the company's earning per share
comprises the net profit after tax (and includes the post tax effect of
any extraordinary items). The number of shares used in computing basic
earning per share is the weighted average number of shares outstanding
during the year.
16. Impairment of Assets:
The carrying amount of assets is reviewed at each balance sheet date to
determine whether there is any indication of impairment. If any such
indication exist, the recoverable amount of the assets is estimated. An
impairment loss is recognised whenever the carrying amount of an asset
or its cash generating units exceeds its recoverable amount. An
impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount and recognised in compliance
with AS-28.
17. Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised 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 recognised nor disclosed in the
financial statements.
18. Inter Divisional Transactions:
Inter divisional transactions are eliminated as contra items. Any
unrealised profits on unsold stocks on account of inter divisional
transactions is eliminated while valuing the inventoy.
Mar 31, 2011
1 Basis of Accounting :
The financial statements are prepared in accordance with relevant
accounting standards under the historical cost convention on accrual
basis and as a going concern with revenues considered and expenses
accounted for wherever possible on their accrual. The accounting
policies are consistent with those used in the previous year.
2 Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of
financial statements and the results of operations during the reporting
year. Although these estimates are based on management's best knowledge
of current events and actions, actual result could differ from these
estimates.
3 Fixed Assets :
a. Fixed assets are stated at cost less accumulated depreciation and
impairment losses, if any. The cost comprises the purchase price and
any attributable cost of bringing assets to its working condition for
its intended use. Borrowing cost relating to acquisition of fixed
assets which takes substantial period of time to get ready for its
intended use are also included to the extent they relate to the period
till such assets are ready to be put to use.
b. Expenditure during the construction period (including financing
cost relating to borrowed funds for construction or acquisition of
fixed assets) incurred on projects under implementation are treated as
pre-operative Expenses, pending allocation to the assets and are
included under "Capital Work in Progress". These expenses are
apportioned to fixed assets on commencement of commercial production.
4 Depreciation :
Depreciation on fixed assets is provided on the basis of straight line
method at the rates prescribed in Schedule-XIV of the Companies Act,
1956 on pro rata basis. The management of the Company is of the view
that these depreciation rates fairly represent the useful life of
assets. The leasehold land is amortized on straighline basis over the
initial period of lease.
5 Inventories :
Raw materials, finished goods, semi finished goods, trading goods and
stores and spares are stated at cost or net realisable value whichever
is lower. Fent, rags and rejections are stated at net realisable value.
The cost of inventories is computed on FIFO basis.
6 Investments:
Investments of the Company are long-term. The same are valued at the
cost of acquisition. Decline in the value of permanent nature is
provided as per accounting standard AS 13. Dividend of investments is
accounted for as and when received.
7 Revenue Recognition :
Revenue is recoginised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured. The Company recognise sales of goods on transfering
property of underlying goods to customers. Sales include all charges
and duties collected. Export benefits in respect of exports made have
been accounted on accrual basis.
8 Excise/Custom Duty :
The liability for excise and custom duty in respect of material lying
in the factory/bonded premises is accounted for as and when they are
cleared/debonded.
9 Foreign Currency Transactions :
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of of the transaction or that
approximates the actual rate at the date of the transaction.
b. Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognised as exchange
difference and the premium paid on forward contracts is recognised over
the life of the contract.
c. Non Monetary foreign currency items are carried at cost.
d. Any income or expense on account of exchange difference either on
settlement or on translation is recognised in Profit & Loss except n
case of long term liabilities, where they relate to acquisition of
fixed assets, in which case they are adjusted to the carrying cost of
such assets.
10 Borrowing Costs:
Borrowing costs directly attributable to the acquisition or
construction of fixed assets are capitalised as part of the cost of the
assets upto the date the asset is put to use. Other borrowing costs are
charged to the Profit & Loss Account in the year in which they are
incurred.
11 Research and Development:
Revenue expendutire, including overheads on Research and Development is
charged out as an expense through the natural heads of account in the
year in which incurred. Expenditure which results in the creation of
capital assets is taken as Fixed Assets and depreciation is provided on
such assets as are depreciable.
12 Government Grants:
Grants received against specific fixed assets are adjusted to the cost
of the assets and those in the nature of promoter's contribution are
credited to Capital Reserve. Revenue Grants are recognised in the
Profit and Loss Account in accordance with the related scheme and in
the period in which these are accured.
13 Retirement Benefits:
The liability for gratuity has been provided on the basis of actuarial
valuation carried out by by an independent actuary as at Balance Sheet
date. In respect of Provident Fund contributions paid regularly to the
government and is charged to revenue. The provision for leave
encashment is made for accumulated leaves that employees can encash in
future.
14 Taxes on Income:
Provision for current tax is made based on the tax liability computed
after considering tax allowances and deductions. Deferred tax resulting
from timing difference between taxable income and accounting income is
accounted for using the tax rates and laws that have been enacted or
substantively enacted as on the balance sheet date. The deferred tax
asset is recognised and carried forward only to the extent that there
is a reasonable certainty that the asset will be realised in future.
15 Earning Per Share
The earning considered in ascertaining the company's earning per share
comprises the net profit after tax (and includes the post tax effect of
any extraordinary items). The number of shares used in computing basic
earning per share is the weighted average number of shares outstanding
during the year.
16 Impairment of Assets
The carrying amount of assets is reviewed at each balance sheet date to
determine whether there is any indication of impairment. If any such
indication exist, the recoverable amount of the assets is estimated. An
impairment loss is recognised whenever the carrying amount of an asset
or its cash generating units exceeds its recoverable amount. An
impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount and recognised in compliance
with AS-28.
Provisions, Contingent Liabilities and Contingent Assets
17 Provisions involving substantial degree of estimation in measurement
are recognised 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 recognised nor disclosed in the
financial statements.
18 Inter Divisional Transactions:
Inter divisional transactions are eliminated as contra items. Any
unrealised profits on unsold stocks on account of inter divisional
transactions is eliminated while valuing the inventoy.
19 Accounting policies not specifically referred to are consistent with
generally accepted accounting policies.
Mar 31, 2010
1.Basis of Accounting: The financial statements are prepared in
accordance Witn relevant accounting standards under the historical cost
convention on accrual basis and as a goirg concern with revenues
considered and expenses accounted for wherever possible on their
accrual. The accounting policies are consistent with those used in the
previous year.
2. Use of Estimates: The preparation of financl statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liability. 3 and disclosure of contingent
liabilities at the date of financial statements and the results of
operations of during the reporting year. Although these estimates are
based on managements best knowledge of current events and actions,
actual result could differ from these estimates.
3. Fixed Assets : a. Fixed assets are stated at cost less accumulated
depreciation and impairment losses, if any. The cost comprises the
purchase price and any attributable cost of bringing assets to its
working condition for its intended use. Borrowing cost relating to
acquisition of fixed assets which takes substantial period of time to
get ready for its intended use are also Included to the extent they
relate to the period till such assets are ready to be put to use.
b. Expenditure during the construction period (Including financing cost
relating to borrowed funds for construction or acquisition of fixed
assets) incurred on projects under implementation are treated as
preoperative Expenses, pending allocation to the assets and are
included under capital Work in Progress7. These expenses are
apportioned to fixed assets on commencement of commercial production.
4. Depreciation : Depreciation on fixed assets is provided on the
basis of straight line meinod at the rates prescribed in Schedule-XIV
of the Companies Act, 1956 on pro rata basis. The management of the
Company is of the view that these depreciation rates fairly represent
the useful life of assets. The leasehold land is amortized on
straighiine basis over the initial period of lease.
5. Inventories : Raw materials, finished goods, semi finished goods,
trading goods and stores and spares are stated at cost or net
realisable value whichever is lower. Fent, rags and rejections are
stated at net realisable value. The cost of inventories is computed on
FIFO basis.
6. Investments: investments of the Company are long-term. The same are
valued at the cost of acquisition. Decline in the value of permanent
nature is provided as per accounting standard AS 13. Dividend of
investments is accounted for as and when received.
7. Revenue Recognition : Revenue is recoginised to the extent that it
is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The Company recognise sales of goods
on transfering property of undelying goods to customers. Sates include
all charges and duties collected. Export benefits in respect of exports
made have been accounted on accrual basis.
8. Excise/Custom Duty : The liability for excise and custom duty in
respect of material lying in the factory/bonded premises is accounted
for as and when they are cleared/debonded.
9. Foreign Currency Transactions : (a)Transsctions denominated in
foreign currencies are recorded at the exchange rate prevailing on the
date of the transaction or that approximates the actual rate at the
date of the transaction.
(b) Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognised as exchange
difference and the premium paid on forward contracts is recognised over
the life of the contract.
(c) Non Monetary foreign currency items are carried at cost.
(d) Any income or expense on account of exchange difference either on
settlement or on translation is recognised in Profit & Loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in which case they are adjusted to the carrying cost of
such assets.
10. Borrowing Costs: Borrowing costs directly attributable to the
acquisition or construction of fixed assets are capitalised as part of
the cost of the assets upto the date the asset is put to use. Other
borrowing costs are charged to the Profit & Loss Account in the year in
which they are incurred.
11. Retirement Benefits: The liability for gratuity has been provided
on the basis of actuarial valuation carried out by an independent
actuary as at Balance Sheet date. In respect of Provident Fund
contributions paid regularly to the government and is charged to
revenue. The provision for leave encashment is made for accumulated
leaves that employees can encash in future.
12. Taxes on Income: Provision for current tax is made annually based
on the tax liability computed after considering tax allowances and
deductions. Deferred tax resulting from timing difference between
taxable income and accounting income is accounted for using the tax
rates and laws that have been enacted or substantively enacted as on
the balance sheet date. The deferred tax asset is recognised and
carried forward only to the extent that there is a reasonable certainty
that the asset will be realised in future.
13. Earning Per Share: The earning considered in ascertaining the
companys earning per share comprises the net profit after tax (and
includes the post tax effect of any extraordinary items). The number of
shares used in computing basic earning per share is the weighted averag
number of shares outstanding during the year.
14. Impairment of Assets : The carrying amount of assets is reviewed at
each balance sheet date to determine whether there is any indication of
impairment. If any such indication exist, the recoverable amount of the
assets is estimated. An impairment loss is recognised whenever the
carrying amount of an asset or its cash generating units exceeds its
recoverable amoun!. An impairment loss is reversed if there has been a
change in the estimates used to determine the recoverable amount and
recognised in compliance with AS-28.
15. Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised 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 recognised nor disclosed in the
financial statements.
16. Inter Divisional Transactions: Inter divisional transactions are
eliminated as contra items. Any unrealised profits on unsold stocks on
account of inter divisional transactions is eliminated while valuing
the inventoy.
17. Accounting policies not specifically referred to are consistent
with generally accepted accounting policies.
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