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Accounting Policies of Orient Bell Ltd. Company

Mar 31, 2019

Note 1: Significant Accounting Policies

a) Significant accounting judgements, estimates and assumptions

The preparation of financial statements in conformity with Ind AS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amount of assets, liabilities, income, expenses and disclosures of contingent assets and liabilities at the date of these financial statements and the reported amount of revenues and expenses for the years presented. Actual results may differ from the estimates.

Estimates and underlying assumptions are reviewed at each balance sheet date. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods affected.

Use of Estimates and Judgements

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, 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. Also, the Company has made certain judgements in applying accounting policies which have an effect on amounts recognized in the financial statements.

i) Income taxes

The Company is subject to income tax laws as applicable in India. Significant judgment is required in determining provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognises liabilities for anticipated tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

ii) Contingencies

Contingent Liabilities may arise from the ordinary course of business in relation to claims against the Company, including legal and other claims. By virtue of their nature, contingencies will be resolved only when one or more uncertain future events occur or fail to occur. The assessment of the existence, and potential quantum, of contingencies inherently involves the exercise of significant judgements and the use of estimates regarding the outcome of future events.

iii) Recoverability of deferred taxes

In assessing the recoverability of deferred tax assets, management considers whether it is probable that taxable profit will be available against which the losses can be utilised. The ultimate realisation of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible.

Management considers the projected future taxable income and tax planning strategies in making this assessment.

iv) Defined benefit plans

The present value of the gratuity and compensated absences 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 reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the actuary considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries.

v) Useful lives of property, plant and equipment

The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

b) Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification.

Assets:

An asset is treated as current when it is:

i) Expected to be realised or intended to be sold or consumed in normal operating cycle.

ii) Held primarily for the purpose of trading

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

iv) 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.

Liabilities:

A liability is current when:

(i) It is expected to be settled in normal operating cycle

(ii) It is held primarily for the purpose of trading

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

(iv) 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 non-current assets and liabilities.

Operating cycle: The operating cycle is the time between the acquisition of assets / liabilities for processing and their realisation / payment in cash and cash equivalents. The Company has identified twelve months as its operating cycle.

c) Property, Plant and Equipment (PPE)

Property, plant and equipment and capital work in progress are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Such cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct services, any other costs directly attributable to bringing the assets to its working condition for their intended use and cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met.

An item of property, plant and equipment and any significant part initially recognised is de-recognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit and loss within other income / expense (as applicable).

Items of stores and spares that meet the definition of property, plant and equipment are capitalised at cost and depreciated over their useful life. Otherwise, such items are classified as inventories.

Subsequent costs : The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item of property, plant and equipment, if it is probable that the future economic benefits embodied within the part will flow to the Company and its cost can be measured reliably with the carrying amount of the replaced part getting derecognised. The cost for day-to-day servicing of property, plant and equipment are recognised in statement of profit and loss as and when incurred.

Decommissioning Costs : The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met.

Capital work in progress : Capital work in progress comprises the cost of fixed assets that are not ready for their intended use at the reporting date. The Company had applied for the one time transition exemption of considering the carrying cost on the transition date i.e. 1^st Apirl, 201 6 as the deemed cost under IND AS.

Depreciation : Depreciation on PPE are provided to the extent of depreciable amount on straight line basis (SLM). Depreciation is provided at the rates and in the manner prescribed in Schedule II to the Companies Act, 2013 except on certain assets, where useful life has been taken based on external / internal technical evaluation which is given below in table. Leasehold Land and Leasehold Improvements are amortised over the period of lease or useful life of assets whichever is lower. The residual values, useful lives are reviewed at each financial year end and adjusted appropriately.

d) Intangible Assets Recognition and measurement

Intangible assets that are acquired by the Company are measured initially at cost. Intangible assets with finite useful lives are measured at cost less accumulated amortisation and accumulated impairment losses, if any. All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years or license period whichever is earlier.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of Profit and Loss.

Amortisation

The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.

The Company had applied for the one time transition exemption of considering the carrying cost on the transition date i.e. 1^st April, 2016 as the deemed cost under IND AS.

e) Borrowing Costs

Borrowing costs consists of interest and amortization of ancillary costs that an entity incurs in connection with the borrowing of funds. 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 cost also includes exchange differences to the extent regarded as an adjustment to the interest cost.

f) Foreign Currency Transaction Functional and presentational currency

The Companyâs financial statements are presented in Indian Rupees (â in lakhs) which is Companyâs functional currency and also the Presentational currency. Functional currency is the currency of the primary economic environment in which a Company operates and is normally the currency in which the Company primarily generates and expends cash.

Transactions and balances

Transactions in foreign currencies are initially recorded by the Company at the functional currency spot rates at the date the transaction first qualifies for recognition.

Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Differences arising on settlement or translation of monetary items are recognised in 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 rate at the date of the transaction.

Advances received or paid in foreign currency are recognised at exchange rate on the date of transaction and are not retranslated.

g) Revenue Recognition

The Company derives revenues primarily from sale of manufactured goods and traded goods.

Effective 01 April, 2018, the Company has adopted Indian Accounting Standard 115 (Ind AS 115) - âRevenue from contracts with customersâ. The effect on adoption of Ind-AS 115 was insignificant.

Revenue from sale of products is recognized upon transfer of control to customers. Revenue is measured at the amount of consideration which the Company expects to be entitled to in exchange for transferring distinct goods to a customer as specified in a contract, excluding amounts collected on behalf of third parties (for example, taxes and duties collected on behalf of the Government). A receivable is recognized upon satisfaction of performance obligations as per the Contracts.

Use of significant Judgements in Revenue Recognition

- Judgement is required to determine the transaction price for the contract. The transaction price could be either a fixed amount of consideration or variable consideration with elements such as volume discounts, price concessions, incentives etc. The estimated amount of variable consideration is adjusted in the transaction price only to the extent that is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur and is reassessed at the end of each reporting period.

- The Company assesses its revenue arrangements against specific recognition criterias like exposure to the significant risks and rewards associated with the sale of goods. When deciding the most appropriate basis for presenting revenue or costs of revenue, both the legal form and substance of the agreement between the Company and its customers are reviewed to determine each partyâs respective role in the transaction.

Other Operating Revenue

Dividend income is recognized when the right to receive payment is established.

Interest income is recognized on a time proportion basis taking into account the amount oustanding and the interest rate applicable.

Claims receivables on account of insurance are accounted for to the extent the Company is reasonably certain of their ultimate collection.

h) Inventories

Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, wherever considered necessary. Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition. The cost of various components of inventory is determined as follows:-

i) Leases

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease.

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

Finance lease

Finance leases are capitalised at the commencement of the lease at the inception date fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance costs in the statement of profit and loss. Contingent rentals are recognised as expenses in the periods in which they are incurred.

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

Operating lease

A lease where risks and rewards incidental to ownership of an asset substantially vest with the lessor is classified as operating lease. Lease payments under operating leases are recognised as an expense in the statement of profit and loss on a straight line basis over the lease term.

The Company has ascertained that the payments to the lessor that are structured in line with expected general inflation to compensate for the lessorâs expected inflationary cost are not straight-lined. Hence, the lease payments are recognised on an accrual basis as per terms of the lease agreement.

Lease income from operating leases where the Company is a lessor is recognized in income on a straight line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases.

j) Employeeâs Benefits

Short Term Employee Benefits: All employee benefits expected to be settled wholly within twelve months of rendering the service are classified as short-term employee benefits. When an employee has rendered service to the Company during an accounting period, the Company recognises the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service as an expense unless another Ind AS requires or permits the inclusion of the benefits in the cost of an asset. Benefits such as salaries, wages and short-term compensated absences, bonus and ex-gratia etc. are recognised in statement of profit and loss in the period in which the employee renders the related service.

Defined Contribution Plan

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions to a statutory authority and thereafter, will have no legal or constructive obligation to pay further amounts. Provident Fund and Employee State Insurance Schemes are defined contribution scheme and contributions paid / payable are recognised as an expense in the statement of profit and loss during the year in which the employee renders the related service.

Defined Benefit Plan

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount based on the respective employeeâs salary and the tenure of employment. The Company accounts for the liability for gratuity benefits payable in future based on an independent actuarial valuation report using the projected unit credit method as at the year end.

Re-measurements, comprising actuarial gains and losses including, the effect of the changes to the asset ceiling (if applicable), is reflected immediately in Other Comprehensive Income they are included in retained earnings in the statement of Changes in Equity and Balance Sheet. All other expenses related to defined benefit plans are recognised in statement of profit and loss as employee benefit expenses. Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement occurs.

Other Long Term Benefits

Long term compensated absences are provided for on the basis of actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains / loss are recognised in Statement of Profit & Loss. On the basis of Companyâs policy, compensated absences upto 50 days (60 days in case of Dora Worker and 30 days in case of SKD workers) are recognised as long term employee benefit & compensated absences beyond 60/50/30 days as may be applicable, shall lapse after the end of financial year.

Employees Share Based Payment

Employees (including senior executives) of the Group receive component of remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).

Equity-settled Transactions

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognised, together with a corresponding increase in share-based payment (SBP) reserves in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Groupâs best estimate of the number of equity instruments that will ultimately vest. The statement of profit and loss expense or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

Termination Benefits

Termination benefits are payable when employment is terminated by the Company before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Company recognises termination benefits at the earlier of the following dates: (a) when the Company can no longer withdraw the offer of those benefits; and (b) when the Company recognises costs for a restructuring that is within the scope of Ind AS 37 and involves the payment of terminations benefits.

k) Provisions, Contingent liabilities and Contingent assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past events and 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 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 recognised as a finance cost.

Contingent liability is disclosed in the case of;

i) a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle obligation;

ii) a present obligation arising from past events, when no reliable estimate is possible.

Contingent assets are neither recognised nor disclosed. However, when realisation of income is virtually certain, related asset is recognised.

Provision, contingent liabilities and contingent assets are reviewed at each balance sheet date and adjusted where necessary to reflect the current best estimate of obligation or asset.

l) Financial Instruments

A financial instrument is a contract that gives rise to a financial asset for one entity and a financial liability or equity instrument for another entity. Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instruments.

(i) Initial recognition and measurement

Trade receivables are initially recognised when they are originated. All other financial assets and financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument.

A financial asset is initially recognised at fair value. In case of financial assets which are recognised at fair value through profit and loss (FVTPL), its transaction cost are recognised in the statement of profit and loss. In other cases, the transaction cost are attributed to the acquisition value of the financial asset.

(ii) Classification and Subsequent measurement

(a) Financial Assets

For purposes of subsequent measurement, financial assets are classified in following categories:

- Financial Asset carried at amortised cost

- Financial Asset at fair value through other comprehensive income (FVTOCI)

- Financial Asset at fair value through profit and loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

- Financial Asset carried at amortised cost

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

- Financial Asset at fair value through other comprehensive income (FVTOCI)

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

- Financial Asset at fair value through profit and loss (FVTPL)

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

- Equity investment in Associates

Investments representing equity interest in associates are carried at cost less any provision for impairment. Investments are reviewed for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable.

The Company had elected for one time IND AS 101 exemption and adopted the fair value of â10 of its investment in equity shares of its associates as its deemed cost as at the date of transition.

De-recognition

A financial asset (or, where applicable, a part of a financial asset) is primarily derecognised (i.e. removed from the Companyâs Balance Sheet) when:

(i) The contractual rights to receive cash flows from the asset has expired, or

(ii) The Company has transferred its contractual rights to receive cash flows from the financial asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass-throughâ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

(b) Financial Liabilities

For purposes of subsequent measurement, financial liabilities are classified in two categories:

- Financial liabilities at amortised cost

- Financial liabilities at fair value through profit and loss (FVTPL)

Financial liabilities at Amortized cost Loans and borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. 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 or 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. This category generally applies to the borrowings.

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 de-recognition of the original liability and the recognition of a new liability. The difference (if any) in the respective carrying amounts is recognised in the statement of profit and loss.

(c) Offsetting of Financial Instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

m) Impairment of Financial Assets

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

n) Impairment of Non-Financial Assets

The carrying amounts of the Companyâs non-financial assets, are reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, then the assetâs recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit (âCGUâ) is the greater of its value in use or its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (âCGUâ).

An impairment loss is recognized, if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount and is recognised in statement of profit and loss.

Impairment losses recognised in prior periods are assessed at end of each reporting period for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the assetâs carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

o) Fair Value Measurement

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

(i) In the principal market for the asset or liability, or

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

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 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities

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

Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value 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. 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.

p) Taxes on Income Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Current income tax relating to items recognized outside profit or loss is recognized outside profit or loss (either in other comprehensive income (OCI) or in equity). Current tax items are recognized in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. Current tax assets are offset against current tax liabilities if, and only if, a legally enforceable right exists to set off the recognised amounts and there is an intention either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Deferred tax

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

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

The carrying amount of deferred tax assets is reviewed at each balance sheet date and is adjusted to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the asset to be recovered.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity).

Minimum Alternate Tax

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

In accordance with Ind AS 12 Company is grouping MAT credit entitlement with Deferred Tax Assets / Liability (Net).

q) Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash balance on hand, cash balance at banks and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Companyâs cash management.

r) Earnings per share (EPS)

In determining earnings per share, the Company considers the net profit after tax and includes the post tax effect of any extra ordinary items.

- Basic earning 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.

- For the purpose of calculating Diluted Earning per share, the number of shares comprises of weighted average shares considered for deriving basic earning per share and also the weighted average number of equity share which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless they have been issued at a later date. A transaction is considered to be antidilutive if its effect is to increase the amount of EPS, either by lowering the share count or increasing the earnings.

s) Segment Reporting

The Company has the policy of reporting the segments in a manner consistent with the internal reporting provided to the chief decision maker. The chief decision maker is considered to be the Board of Directors who makes strategic decisions and is responsible for allocating resources and assessing performance of the operating segments.

Mar 31, 2018

a) Significant accounting judgements, estimates and assumptions

Judgements

In the process of applying the Companyâs accounting policies, management has made the following judgements, which have an effect on the amounts recognised in the financial statements:

Revenue recognition and presentation

The Company assesses its revenue arrangements against specific criteria, i.e. whether it has exposure to the significant risks and rewards associated with the sale of goods or the rendering of services, in order to determine if it is acting as a principal or as an agent. The Company has concluded that they operating on a principal to principal basis in all its revenue arrangements. When deciding the most appropriate basis for presenting revenue or costs of revenue, both the legal form and substance of the agreement between the Company and its business partners are reviewed to determine each partyâs respective role in the transaction.

Useful lives of property, plant and equipment

The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

Estimates and Assumptions

i) Income taxes

ii) Contingencies

iii) Recoverability of deferred taxes

iv) Defined benefit plans

b) Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification.

Assets:

An asset is treated as current when it is:

i) Expected to be realised or intended to be sold or consumed in normal operating cycle.

ii) Held primarily for the purpose of trading

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

iv) 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.

Liabilities:

A liability is current when:

(i) It is expected to be settled in normal operating cycle

(ii) It is held primarily for the purpose of trading

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

(iv) 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 non-current assets and liabilities.

c) Property, Plant and Equipment (PPE)

Subsequent costs: The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item of property, plant and equipment, if it is probable that the future economic benefits embodied within the part will flow to the Company and its cost can be measured reliably with the carrying amount of the replaced part getting derecognised. The cost for day-to-day servicing of property, plant and equipment are recognised in statement of profit and loss as and when incurred.

Capital work in progress: Capital work in progress comprises the cost of fixed assets that are not ready for their intended use at the reporting date.

Transition to Ind AS: On transition to Ind AS, the Company has elected to continue with the carrying value of all its property, plant and equipment as at 1 April 2016, measured as per the previous GAAP, and use that carrying value as the deemed cost of such property, plant and equipment w.e.f. transition date onwards.

*For these classes of assets, based on internal assessment and independent technical evaluation carried out by external valuers, the Management believes that the useful lives as given above best represent the period over which the Management expects to use these assets. Hence the useful lives for these assets is different from the useful lives as prescribed under Part C of Schedule II of the Companies Act 2013.

d) Intangible Assets Recognition and measurement

Transition to Ind AS

On transition to Ind AS, the Company has elected to continue with the carrying value of all its intangible assets recognized as at 1 April 2016, measured as per the previous GAAP, and use that carrying value as the deemed cost of such intangible assets from transition date onwards.

Amortisation

e) Borrowing Costs

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

f) Foreign Currency Transaction Functional and presentational currency

The Companyâs financial statements are presented in Indian Rupees (â in lakhs) which is also the Companyâs functional currency. Functional currency is the currency of the primary economic environment in which a Company operates and is normally the currency in which the Company primarily generates and expends cash. All the financial information are presented in â in lakhs except where otherwise stated.

Transactions and balances

Transactions in foreign currencies are initially recorded by the Company at the functional currency spot rates at the date the transaction first qualifies for recognition.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

g) 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. Revenue from the sale of goods in the course of ordinary activities is measured at the fair value of the consideration received or receivable, exclusive of sales tax, Value Added Taxes (VAT), Goods and Service taxes (GST) and service tax and is net of returns, trade discounts, quantity discounts, cash discounts.

Dividend income is recognized when the right to receive payment is established.

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the interest rate applicable.

Claims receivables on account of insurance are accounted for to the extent the Company is reasonably certain of their ultimate collection.

h) Inventories

i) Leases

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease. A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a finance lease. All the lease other than Finance lease are classified as operating lease. For arrangements entered into prior to the Ind AS transition date i.e. April 01, 2016, the Company has determined whether the arrangement contain lease on the basis of facts and circumstances existing on the date of transition.

Finance lease

Operating lease

j) Employeeâs Benefits

Defined Contribution Plan

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions to a statutory authority and will have no legal or constructive obligation to pay further amounts. Provident Fund and Employee State Insurance Schemes are defined contribution scheme and contributions paid / payable are recognised as an expense in the statement of profit and loss during the year in which the employee renders the related service.

Defined Benefit Plan

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount based on the respective employeeâs salary and the tenure of employment. The Company accounts for the liability for gratuity benefits payable in future based on an independent actuarial valuation report using the projected unit credit method as at the year end.

The obligations are measured at the present value of the estimated future cash flows. The discount rate is generally based upon the market yields available on Government bonds at the reporting date with a term that matches that of the liabilities. Re-measurements, comprising actuarial gains and losses including, the effect of the changes to the asset ceiling (if applicable), is reflected immediately in Other Comprehensive Income in the statement of profit and loss. All other expenses related to defined benefit plans are recognised in statement of profit and loss as employee benefit expenses. Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement occurs.

Other Long Term Benefits

Long term compensated absences are provided for on the basis of actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains / loss are recognised in Statement of Profit & Loss. On the basis of companies policy, compensated absences upto 60 days (30 days in case of SKD workers) are recognised as long term employee benefit & compensated absences beyond 60/30 days as may be applicable, if any are to be recognised as short term employee benefit.

Employees Share Based Payment

Equity-settled Transactions

k) Provisions, Contingent liabilities and Contingent assets

Contingent liability is disclosed in the case of;

i) a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle obligation;

ii) a present obligation arising from past events, when no reliable estimate is possible.

Contingent assets are neither recognised nor disclosed. However, when realisation of income is virtually certain, related asset is recognised.

Provision, contingent liabilities and contingent assets are reviewed at each balance sheet date and adjusted where necessary to reflect the current best estimate of obligation or asset.

l) Financial Instruments

(i) Initial recognition and measurement

(ii) Classification and Subsequent measurement

(a) Financial Assets

For purposes of subsequent measurement, financial assets are classified in following categories:

- Financial Asset carried at amortised cost

- Financial Asset at fair value through other comprehensive income (FVTOCI)

- Financial Asset at fair value through profit and loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

- Financial Asset carried at amortised cost

- Financial Asset at fair value through other comprehensive income (FVTOCI)

- Financial Asset at fair value through profit and loss (FVTPL)

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

- Equity investment in Associates

De-recognition

A financial asset (or, where applicable, a part of a financial asset) is primarily derecognised (i.e. removed from the Companyâs Balance Sheet) when:

(i) The contractual rights to receive cash flows from the asset has expired, or

(ii) The Company has transferred its contractual rights to receive cash flows from the financial asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass-throughâ arrangement and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

(b) Financial Liabilities

For purposes of subsequent measurement, financial liabilities are classified in two categories:

- Financial liabilities at amortised cost

- Financial liabilities at fair value through profit and loss (FVTPL)

Financial liabilities at Amortized cost Loans and borrowings

De-recognition

(c) Offsetting of Financial Instruments

m) Impairment of Financial Assets

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

n) Impairment of Non-Financial Assets

An impairment loss is recognized, if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount and is recognised in statement of profit and loss.

o) Fair Value Measurement

(i) In the principal market for the asset or liability, or

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

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

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

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

p) Taxes on Income Current income tax

Deferred tax

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity).

Minimum Alternate Tax

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

In accordance with Ind AS 12 Company is grouping MAT credit entitlement with Deferred Tax Assets / Liability (Net).

q) Cash and cash equivalents

r) Earnings per share (EPS)

In determining earnings per share, the Company considers the net profit after tax and includes the post tax effect of any extra ordinary items.

s) Segment Reporting

Mar 31, 2016

NOTE 1 : CORPORATE INFORMATION

Orient Bell Limited (the Company) is engaged in the manufacturing, trading and selling of reputed brand of ceramic and floor tiles. Company is a public company incorporated and domiciled in India and has its registered office at Sikandrabad, Uttar Pradesh, India. The Company has its primary listings on BSE Limited and the National Stock Exchange of India Limited.

NOTE 2 : SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO THE ACCOUNT

Note 2.1 Accounting Convention

These financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (''the Act'') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied except where a newly-issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

NOTE 2.2: SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO THE ACCOUNT

a) Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires the management to make judgment, estimates and assumptions that affect the reported amounts of revenues, expenses, assets & liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could results in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

b) Tangible Assets and Capital Work-In-Progress

Tangible Assets are recorded at their original cost of acquisition less accumulated depreciation and impairment, if any. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use. Glow-sign Boards, which have no salvage value are charged to the Statement of Profit & Loss. Capital work-in-progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date.

c) Intangible Assets

Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment.

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years.

d) Depreciation and Amortization

Depreciation on tangible assets is provided on the straight-line method over the useful lives of assets estimated by the Management. Depreciation for assets purchased / sold during a period is proportionately charged. Intangible assets are amortized over their respective individual estimated useful lives on a straight-line basis, commencing from the date the asset is available to the Company for its use. Further, the Schedule II to the Companies Act, 2013 requires that useful life and depreciation for significant components of an asset should be determined separately. The identification of significant components is matter of technical judgement and is decided on case to case basis; wherever applicable. The following useful lifeâs of the tangible fixed assets has been estimated by the management:

Certain plants, subassemblies at Dora and Hoskote unit having limited life span of three years which have been written off over such life span.

Till March 31,2014 ,in accordance with the option given in the Guidance Note on Accounting for Depreciation in Companies, the Company recoups additional depreciation out of Revaluation reserve. However during the year, as per Schedule II of the Companies Act,2013 read with para 36 of Application Guide on the Provisions of Schedule II to the Companies Act,2013 issued by Institute of Chartered Accountants of India, the depreciation on revalued amount has been charged to statement of the profit and loss and the amount of depreciation which relates to the difference between depreciation based on the revalued carrying amount of the asset and depreciation based on its original cost has been transferred from the revaluation reserve to the general reserves of the company.

Depreciation and amortization methods, useful lives and residual values are reviewed periodically, including at each financial year end (Refer Note 10)

e) Revenue/Purchase 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 following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the significant risk and rewards of ownership of the goods have been passed to the buyer, usually on the delivery of the goods. The company collects sales tax and value added tax on behalf of the government, therefore, these are not economic benefits flowing to the company, hence, these are excluded from the revenue. Further Trade discounts are excluded from the Revenue. Excise duty deducted from Revenue (Gross) is the amount that is included in the revenue (Gross) and not the entire amount of liability arising during the year.

Interest

Interest income is recognized on time proportion basis taking into account the amount outstanding and the applicable rate. Interest income is included under the head "Other Incomeâ in the Statement of Profit and Loss.

Dividend

Dividend income from investments is recognized when the company''s right to receive dividend is established by the reporting date.

Other Income

Export incentives and Rental Incomes are accounted on accrual basis.

Claims are accounted on acknowledgement from the appropriate authority.

Purchase of indigenous material is recognized on the basis of receipt of material in the factory premises.

f) Borrowing Cost

Borrowing costs include Interest, Amortization of ancilliary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are attributable to the acquisition or construction of qualifying fixed assets are capitalized as part of the cost of assets. All other borrowing costs are recognized as expense in the year in which they are incurred.

g) Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as Current Investments. All other investments are classified as Long Term Investments.

Initial Recognition

All investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Carrying Amount of Investments

- Current Investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis.

- Long Term Investments are carried at cost. However, provision for diminution in value is made to recognized a decline other than temporary in the value of the investments.

Disposal of Investments

The difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

h) CENVAT and Excise Duty

Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the company as at the end of financial year. CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

j) Translation of Foreign Currency items Initial Recognition

Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction. Exchange Differences

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss in the period in which they arise except in case of long term foreign currency monetary items, where the exchange differences arising on reporting of long term foreign currency monetary items, in so far as they relate to the acquisition of a depreciable capital asset, is added to or deducted from the cost of the asset and depreciated over the balance life of the asset, and in other cases, is accumulated in a "Foreign Currency Monetary Item Translation Difference Accountâ and amortized over the balance period of such long term asset or liability, by recognition as income or expense in each of such periods.

Conversion

Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

k) Taxes on Income

Tax expense comprises current tax and deferred tax.

Current Tax

Current Tax is measured and expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961, and based on the expected outcome of assessment/appeals. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognized directly in equity is recognized in equity and not in the statement of Profit and Loss.

Deferred Tax

Deferred tax reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognized directly in equity is recognized in equity and not in the statement of Profit and Loss. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

Minimum Alternate Tax

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

l) Employee Benefits

(a) Short-term employee benefit

Short-term employee benefits including short term compensated absences are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which related service is rendered. Terminal benefits are recognized as an expense immediately.

(b) Defined Contribution Plan

Contributions payable to recognized provident fund, employee state insurance scheme and superannuation scheme, which are substantially defined contribution plans, are recognized as expense in the Statement of Profit and Loss, as they incurred.

In addition to the provident fund contribution to Govt provident funds, the Company is also having its own provided fund irrevocable trust to which contributions of certain employees along with the corresponding employer contributions are deposited within the specified time.

Certain employees of Dora and Hoskote Unit are covered by a superannuation fund benefit of Life Insurance Corporation of India at a company contribution 15% of basic salary. This is a defined contribution scheme and the contributions are charged to Statement of Profit and Loss of the year when the contribution to the fund is due. There are no obligations other than the contribution payable to the fund.

The obligation in respect of defined benefit plans, which cover Gratuity, are provided for on the basis of an actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognized immediately in the Statement of Profit and Loss.

The company through its trust has taken a policy, for employees of Head Office and Sikandrabad Unit, with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees.

For the employees at Dora and Hoskote unit, company has taken an Employees'' Gratuity Scheme which is a defined benefit plan of Life Insurance Corporation of India.

(d) Other Long-term Benefits

On the basis of Company''s policy, compensated absences up to 60 days are recognized as long term employee benefit and compensated absences beyond 60 day''s, if any are to be recognized as short term employee benefit.

(e) Share-based payments

The Company accounts for equity settled stock options as per the accounting treatment prescribed by Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 amended thereto and the Guidance Note on Employee Share-based Payments issued by the Institute of Chartered Accountants of India using the intrinsic value method.

m) Impairment of Assets

The company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the recoverable amount is determined. 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 value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.

Impairment losses of continuing operations, including impairment on Inventories, are recognized in the statements of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to Revaluation Reserve. In this case, the impairment is also recognized in the revaluation reserve up to the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the assets''s recoverable amount since the last impairment loss was recognized. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in statement of profit and loss unless the asset is carried at a revalued amount, in which case the reversal is treated as revaluation increase.

n) Provision, 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.

o) Lease

Lease under which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. Such assets acquired are capitalized at fair value of the asset or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease payments under operating leases are recognized as an expense on a straight-line basis in the Statement of Profit and Loss over the lease term.

p) Earning Per Share

Basic earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share is computed by dividing the profit after tax by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. The diluted potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value which is the average market value of the outstanding shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented. The number of shares and potentially dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues, including for changes effected prior to the approval of the financial statements by the Board of Directors.

q) Cash flow Statement

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

r) Cash and cash equivalents

Cash and cash equivalents comprise cash and cash on deposit with banks and corporations. The Company considers all highly liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to known amounts of cash to be cash equivalents.

* The above includes equity shares 30,43,451 nos (Rs. 3,04,34,510) which were alloted during 2012-13 pursuant to the schemes of amalgamation without payments being received in cash.

Mar 31, 2015

A) Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires the management to make judgement, estimates and assumptions that affect the reported amounts of revenues, expenses, assets & liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

b) Tangible Assets and Capital Work-In-Progress

Tangible Assets are recorded at their original cost of acquisition less accumulated depreciation and impairment, if any. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use. Glow-sign Boards, which have no salvage value are charged to the Statement of Profit & Loss. Capital work-in-progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date.

c) Intangible Assets

Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment. All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years.

d) Depreciation and Amortization

Depreciation on tangible assets is provided on the straight-line method over the useful lives of assets estimated by the Management. Depreciation for assets purchased / sold during a period is proportionately charged. Intangible assets are amortized over their respective individual estimated useful lives on a straight-line basis, commencing from the date the asset is available to the Company for its use. The Management estimates the useful lives for the other fixed assets as follows:

Buildings 10-60 years

Plant and machinery* 18 years

Office equipment 5 years

Computer equipment 3-6 years

Furniture and fixtures 10 years

Electrical installations 10 years

Vehicles 8-10 years

*For these classes of assets, based on internal assessment and independent technical evaluation carried out by external valuers, the Management believes that the useful lives as given above best represent the period over which the Management expects to use these assets. Hence the useful lives for these assets is different from the useful lives as prescribed under Part C of Schedule II of the Companies Act 2013.

Certain plants, subassemblies at Dora and Hoskote units having limited life span of three years which have been written off over such life span.

Till March 31,2014 in accordance with the option given in the Guidance Note on Accounting for Depreciation in Companies, the Company recoups additional depreciation out of Revaluation reserve. However during the year, as per Schedule II of the Companies Act,2013 read with para 36 of "Application Guide on the Provisions of Schedule II to the Companies Act,2013 issued by Institute of Chartered Accountants of India, the depreciation on revalued amount has been charged to statement of the profit and loss and the amount of depreciation which relates to the difference between depreciation based on the revalued carrying amount of the asset and depreciation based on its original cost has been transferred from the revaluation reserve to the general reserves of the company.

Depreciation and amortization methods, useful lives and residual values are reviewed periodically, including at each financial year end (Refer Note 10).

e) Revenue/Purchase 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 following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognised when all the significant risk and rewards of ownership of the goods have been passed to the buyer, usually on the delivery of the goods. The company collects sales tax and value added tax on behalf of the government, therefore, these are not economic benefits flowing to the company, hence, these are excluded from the revenue. Further Trade discounts are excluded from the Revenue. Excise duty deducted from Revenue (Gross) is the amount that is included in the revenue (Gross) and not the entire amount of liability arising during the year.

Interest

Interest income is recognized on time proportion basis taking into account the amount outstanding and the applicable rate. Interest income is included under the head "Other Income" in the Statement of Profit and Loss.

Dividend

Dividend income from investments is recognised when the company''s right to receive dividend is established by the reporting date.

Other Income

Export incentives and Rental Incomes are accounted on accrual basis. Claims are accounted on acknowledgement from the appropriate authority. Purchase of indigenous material is recognized on the basis of receipt of material in the factory premises.

f) Borrowing Cost

Borrowing costs include Interest, Amortisation of ancilliary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are attributable to the acquisition or construction of qualifying fixed assets are capitalized as part of the cost of assets. All other borrowing costs are recognized as expense in the year in which they are incurred.

g) Investments

Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as Current Investments. All other investments are classified as Long Term Investments.

Initial Recognition

All investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Carrying Amount of Investments

- Current Investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis.

- Long Term Investments are carried at cost. However, provision for diminition in value is made to recognised a decline other than temporary in the value of the investments.

Disposal of Investments

The difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

h) CENVAT and Excise Duty

Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the company as at the end of financial year. CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

i) Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows:

Raw Materials, Stores, Spares and Packing Material

Cost includes purchase price, non refundable duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-process and Finished Goods

Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods Cost includes purchase cost, duties, taxes and all other costs incurred in bringing the inventory to their present location. Cost is determined on First In First Out (FIFO) basis.

j) Translation of Foreign Currency items

Initial Recognition Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction.

Exchange Differences

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss in the period in which they arise except in case of long term foreign currency monetary items, where the exchange differences arising on reporting of long term foreign currency monetary items, in so far as they relate to the acquisition of a depreciable capital asset, is added to or deducted from the cost of the asset and depreciated over the balance life of the asset, and in other cases, is accumulated in a "Foreign Currency Monetary Item Translation Difference Account" and amortised over the balance period of such long term asset or liability, by recognition as income or expense in each of such periods.

Conversion

Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

k) Taxes on Income

Tax expense comprises current tax and deferred tax.

Current Tax

Current Tax is measured and expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961, and based on the expected outcome of assessment/appeals. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss.

Deferred Tax

Deferred tax reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

Minimum Alternate Tax

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

l) Employee Benefits

(a) Short-term employee benefit

Short-term employee benefits including short term compensated absences are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which related service is rendered. Terminal benefits are recognized as an expense immediately.

(b) Defined Contribution Plan

Contributions payable to recognised provident fund, employee state insurance scheme and superannuation scheme, which are substantially defined contribution plans, are recognised as expense in the Statement of Profit and Loss, as they incurred.

In addition to the provident fund contribution to Govt provident funds, the Company is also having its own provident fund irrevocable trust to which contributions of certain employees along with the corresponding employer contributions are deposited within the specified time.

Certain employees of Dora and Hoskote Unit are covered by a superannuation fund benefit of Life Insurance Corporation of India at a company contribution 15% of basic salary. This is a defined contribution scheme and the contributions are charged to Statement of Profit and Loss of the year when the contribution to the fund is due. There are no obligations other than the contribution payable to the fund.

(c) Defined Benefit Plan

The obligation in respect of defined benefit plans, which cover Gratuity, are provided for on the basis of an actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

The Company through its trust has taken a policy, for employees of Head Office and Sikandrabad Unit, with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees.

For the employees at Dora and Hoskote unit, Company has taken an Employees'' Gratuity Scheme which is a defined benefit plan of Life Insurance Corporation of India.

(d) Other Long-term Benefits

Long term compensated absences are provided for on the basis of actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

On the basis of Company''s policy, compensated absences up to 60 days are recognised as long term employee benefit and compensated absences beyond 60 days, if any are to be recognised as short term employee benefit.

(e) Share-based payments

The Company accounts for equity settled stock options as per the accounting treatment prescribed by Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as amended from time to time and the Guidance Note on Employee Share-based Payments issued by the Institute of Chartered Accountants of India using the intrinsic value method.

m) Impairment of Assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the recoverable amount is determined. 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 value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.

Impairment losses of continuing operations, including impairment on Inventories, are recognised in the statements of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to Revaluation Reserve. In this case, the impairment is also recognised in the revaluation reserve upto the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets''s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in statement of profit and loss unless the asset is carried at a revalued amount, in which case the reversal is treated as revaluation increase.

n) Provision, 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.

o) Lease

Lease under which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. Such assets acquired are capitalized at fair value of the asset or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease payments under operating leases are recognized as an expense on a straight-line basis in the Statement of Profit and Loss over the lease term.

p) Earning Per Share

Basic earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share is computed by dividing the profit after tax by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. The diluted potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value which is the average market value of the outstanding shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented. The number of shares and potentially dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues, including for changes effected prior to the approval of the financial statements by the Board of Directors.

q) Cash flow Statement

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

r) Cash and cash equivalents

Cash and cash equivalents comprise cash and cash on deposit with banks and corporations. The Company considers all highly liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to known amounts of cash to be cash equivalents.

Mar 31, 2014

The financial statements of the company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). The company has prepared the financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention, except for Buildings situated at Hoskote and Dora unit which are carried at revalued amounts.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policies explained below.

a) Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires the management to make judgement, estimates and assumptions that affect the reported amounts of revenues, expenses, assets & liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could results in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

b) Fixed Assets

Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use. Glow-sign Boards, which have no salvage value is charged to the Statement of Profit & Loss.

c) Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years.

d) Depreciation/ Amortization

Depreciation is provided on straight-line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 except on Plant & Machinery installed at Sikandrabad plant till 31st March 2011 which is provided as under

= > For plant & machinery installed at Sikandrabad plant till 31st March 2011, rate has been calculated on the basis of estimated useful life.

= > Certain plants, subassemblies at Dora and Hoskote unit having limited life span of three years which have been written off over such life span.

The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase. Leasehold properties are amortized over the lease period or its useful life, whichever is shorter.

e) Revenue/Purchase Recognition

Revenue is recognized to the extent that it is probabale that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognised when all the significant risk and rewards of ownership of the goods have been passed to the buyer, usually on the delivery of the goods. The company collects sales tax and value added tax on behalf of the government, therefore, these are not economic benefits flowing to the company, hence, these are excluded from the revenue. Further Trade discounts are excluded from the Revenue. Excise duty deducted from Revenue (Gross) is the amount that is included in the revenue (Gross) and not the entire amount of liability arising during the year.

Interest

Interest income is recognized on time proportion basis taking into account the amount outstanding and the applicable rate. Interest income is included under the head "Other Income" in the "Statement of Profit and Loss".

Dividend

Dividend income from investments is recognised when the company''s right to receive dividend is established by the reporting date.

Other Income

Export incentives and Rental Incomes are accounted on accrual basis.

Claims are accounted on acknowledgement from the appropriate authority.

Purchase of material is recognized on the basis of receipt of material in the factory premises.

f) Borrowing Cost

Borrowing costs includes Interest, Amortisation of ancilliary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are attributable to the acquisition or construction of qualifying fixed assets are capitalized as part of the cost of assets. All other borrowing costs are recognized as expense in the year in which they are incurred.

g) Investments

Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as Current Investments. All other investments are classified as Long Term Investments.

Initial Recognition

All investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Carrying Amount of Investments

* Current Investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis.

* Long Term Investments are carried at cost. However, provision for diminution in value is made to recognise a decline other than temporary in the value of the investments.

Disposal of Investments

The difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

h) CENVAT and Excise Duty

Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the company as at the end of financial year. CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

i) Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows:

Raw Materials, Stores, Spares and Packing Material

Cost includes purchase price, non refundable duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-process and Finished Goods

Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods

Cost includes purchase cost, duties, taxes and all other costs incurred in bringing the inventory to their present location. Cost is determined on First In First Out (FIFO) basis.

j) Translation of Foreign Currency items Initial Recognition

Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction.

Exchange Differences

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss in the period in which they arise except in case of long term foreign currency monetary items, where the exchange differences arising on reporting of long term foreign currency monetary items, in so far as they relate to the acquisition of a depreciable capital asset, is added to or deducted from the cost of the asset and depreciated over the balance life of the asset, and in other cases, is accumulated in a "Foreign Currency Monetary Item Translation Difference Account" and amortised over the balance period of such long term asset or liability, by recognition as income or expense in each of such periods.

Conversion

Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

k) Taxes on Income

Tax expense comprises current tax and deferred tax.

Current Tax

Current Tax is measured and expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961, and based on the expected outcome of assessment/appeals. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss.

Deferred Tax

Deferred tax reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

Minimum Alternate Tax

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

l) Employee Benefits

(a) Short-term employee benefit

Short-term employee benefits including short term compensated absences are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which related service is rendered. Terminal benefits are recognized as an expense immediately.

(b) Defined Contribution Plan

Contributions payable to recognised provident fund, employee state insurance scheme and superannuation scheme, which are substaintially defined contribution plans, are recognised as expense in the Statement of Profit and Loss, as they incurred.

In addition to the provident fund contribution to Govt provident funds, the Company is also having its own provident fund irrevocable trust to which contributions of certain employees along with the corresponding employer contributions are deposited within the specified time.

Certain employees of Dora and Hoskote Unit are covered by a superannuation fund benefit of Life Insurance Corporation of India at a company contribution 15% of basic salary. This is a defined contribution scheme and the contributions are charged to Statement of Profit and Loss of the year when the contribution to the fund is due. There are no obligations other than the contribution payable to the fund.

(c) Defined Benefit Plan

The obligation in respect of defined benefit plans, which cover Gratuity, are provided for on the basis of an actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

The company through its trust has taken a policy, for employees of Head Office and Sikandrabad Unit, with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees.

For the employees at Dora and Hoskote unit, company has taken an Employees'' Gratuity Scheme which is a defined benefit plan of Life Insurance Corporation of India.

(d) Other Long-term Benefits

Long term compensated absences are provided for on the basis of actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

On the basis of Company''s policy, compensated absences up to 60 days are recognised as long term employee benefit and compensated absences beyond 60 days, if any are to be recognised as short term employee benefit.

m) Impairment of Assets

The company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the recoverable amount is determined. 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 value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.

Impairment losses of continuing operations, including impairment on Inventories, are recognised in the statements of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to Revaluation Reserve. In this case, the impairment is also recognised in the revaluation reserve upto the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in statement of profit and loss unless the asset is carried at a revalued amount, in which case the reversal is treated as revaluation increase.

n) Provision, 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.

o) Lease

Leases, where lessor effectively retains substantially all the risk and benefits of ownership of the leased item, are classified as Operating Lease. Operating lease payments are recognised as an expense in the statement of profit and loss on straight - line- basis over the leased term.

p) Earning Per Share

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

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

q) Cash flow Statement

Cash flow statement is prepared as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" notified under the Companies (Accounting Standard) Rules, 2006.

Mar 31, 2013

A) Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires the management to make judgement, estimates and assumptions that affect the reported amounts of revenues, expenses, assets & liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

b) Fixed Assets

Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use. Glow-sign Boards, which have no salvage value is charged to the Statement of Profit & Loss.

c) Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years.

d) Depreciation/ Amortization

Depreciation is provided on straight-line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 except on Plant & Machinery installed at Sikanderabad plant till 31st March 2011 which is provided as under:

- For plant & machinery installed at Sikanderabad plant till 31st March 2011, rate has been calculated on the basis of estimated useful life.

- Certain plants, subassemblies at Dora and Hoskote unit having limited life span of three years which have been written off over such life span.

The assets costing up to H 5,000 are fully depreciated in the year of purchase. Leasehold properties are amortized over the period of respective lease.

e) Revenue/Purchase 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 following specific recognition criteria must also be met before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognised when all the significant risk and rewards of ownership of the goods have been passed to the buyer, usually on the delivery of the goods. The Company collects sales tax and value added tax on behalf of the government, therefore, these are not economic benefits flowing to the Company, hence, these are excluded from the revenue. Further Trade discounts are excluded from the Revenue. Excise duty deducted from Revenue (Gross) is the amount that is included in the revenue (Gross) and not the entire amount of liability arising during the year.

Interest

Interest income is recognized on time proportion basis taking into account the amount outstanding and the applicable rate.

Interest income is included under the head "Other Income" in the Statement of Profit and Loss.

Dividend

Dividend income from investments is recognised when the Company''s right to receive dividend is established by the reporting date.

Other Income

Export incentives and Rental Incomes are accounted on accrual basis.

Claims are accounted on acknowledgement from the appropriate authority.

Purchase of material is recognized on the basis of receipt of material in the factory premises.

f) Borrowing Cost

Borrowing costs includes Interest, Amortisation of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are attributable to the acquisition or construction of qualifying fixed assets are capitalized as part of the cost of assets. All other borrowing costs are recognized as expense in the year in which they are incurred.

g) Investments

Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as Current Investments. All other investments are classified as Long Term Investments.

Initial Recognition

All investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as

brokerage, fees and duties.

Carrying Amount of Investments

- Current Investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis.

- Long Term Investments are carried at cost. However, provision for diminution in value is made to recognise a decline other than temporary in the value of the investments.

Disposal of Investments

The difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

h) CENVAT and Excise Duty

Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the Company as at the end of financial year. CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

i) Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows:

Raw Materials, Stores, Spares and Packing Material

Cost includes purchase price, non refundable duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-process and Finished Goods

Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods Cost includes purchase cost, duties, taxes and all other costs incurred in bringing the inventory to their present location. Cost is determined on First In First Out (FIFO) basis.

j) Translation of Foreign Currency items Initial Recognition Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction.

Exchange Differences

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss in the period in which they arise.

Conversion

Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

k) Taxes on Income

Tax expense comprises current tax and deferred tax.

Current Tax

Current Tax is measured and expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961, and based on the expected outcome of assessment/appeals. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss.

Deferred Tax

Deferred tax reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

Minimum Alternate Tax

Minimum Alternate Tax (MAT) paid in the year is charged to the statement of profit and loss as current tax. The Company recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. 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 Alternate Tax under the Income Tax Act, 1961, the said asset is created by way of credit to the statement of Profit and Loss and shown as "MAT Credit entitlement ". The Company reviews the "MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the Company does not have convincing evidence that it will pay normal tax during the specified period.

l) Employee Benefits

(a) Short-term employee benefit Short-term employee benefits including short term compensated absences are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which related service is rendered. Terminal benefits are recognized as an expense immediately.

(b) Defined Contribution Plan Contributions payable to recognised provident fund, employee state insurance scheme and superannuation scheme, which are substantially defined contribution plans, are recognised as expense in the Statement of Profit and Loss, as they incurred.

In addition to the provident fund contribution to Govt provident funds, the Company is also having its own provident fund irrevocable trust to which contributions of certain employees along with the corresponding employer contributions are deposited within the specified time.

Certain employees of Dora and Hoskote Unit are covered by a superannuation fund benefit of Life Insurance Corporation of India at a Company contribution 15% of basic salary. This is a defined contribution scheme and the contributions are charged to Statement of Profit and Loss of the year when the contribution to the fund is due. There are no obligations other than the contribution payable to the fund.

(c) Defined Benefit Plan The obligation in respect of defined benefit plans, which cover Gratuity, are provided for on the basis of an actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

The Company through its trust has taken a policy, for employees of Head Office and Sikandrabad Unit, with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees.

For the employees at Dora and Hoskote unit, Company has taken an Employees'' Gratuity Scheme which is a defined benefit plan of Life Insurance Corporation of India.

(d) Other Long-term Benefits

Long term compensated absences are provided for on the basis of actuarial valuation, using the projected unit credit method, at the end of each financial year. Actuarial gains/losses, if any, are recognised immediately in the Statement of Profit and Loss.

On the basis of Company''s policy, compensated absences up to 60 days are recognised as long term employee benefit and compensated absences beyond 60 days, if any are to be recognised as short term employee benefit.

m) Impairment of Assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the recoverable amount is determined. 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 value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.

Impairment losses of continuing operations, including impairment on Inventories, are recognised in the statements of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to Revaluation Reserve. In this case, the impairment is also recognised in the revaluation reserve upto the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in statement of profit and loss unless the asset is carried at a revalued amount, in which case the reversal is treated as revaluation increase.

n) Provision, 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.

o) Lease

Leases, where lessor effectively retains substantially all the risk and benefits of ownership of the leased item, are classified as Operating Lease. Operating lease payments are recognised as an expense in the statement of profit and loss on straight -line basis over the leased term.

p) Earning Per Share

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

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

q) Cash flow Statement

Cash flow statement is prepared as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" notified under the Companies (Accounting Standard) Rules, 2006.

Mar 31, 2012

Accounting Convention

The financial statements of the company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). The company has prepared the financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) rules, 2006, (as ammended) and the relevant provisions of the companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention, except for Building situated at Hoskote and Dora unit which are carried at revalued amounts.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policies explained below.

a) Change In Accounting policy

Presentation and Disclosure of financial Statements

During the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company, for preparation and presentation of its financial statements. There is a significant impact on presentation and disclosure made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

Valuation of Inventories

In earlier periods, the Hoskote and Dora unit of the Transferor Company were using weighted average method to ascertain the cost of inventories. In the current year consequent upon the orders of Hon'ble High Court approving the scheme of Amalgamation u/s 391 to 394 (for further details refer to note no 26), the said policy was changed to bring it in line with the Transferee company. In accordance with the revised policy, the company ascertains the cost of inventories at Hoskote and Dora unit on First In First Out (FIFO) Basis.

Had the company continued to use the earlier policy of ascertaining the cost of inventories at Hoskote and Dora unit at weighted average basis, the credit to the statement of profit and loss after tax for the current period would have been higher by Rs 9,27,216 and current assets would correspondingly have been higher by Rs 9,27,216.

b) Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires the management to make judgement, estimates and assumptions that affect the reported amounts of revenues, expenses, assets & liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could results in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

c) Fixed Assets

Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use. Glow-sign Boards, which have no salvage value is charged to the Statement of Profit & Loss.

d) Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. Specialized softwares are amortized over a period of 3 years.

e) Depreciation/ Amortization

Depreciation is provided on straight-line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 except on Plant & Machinery which is provided as under:

- For plant & machinery installed at Sikandrabad plant till 31st March 2011, rate has been calculated on the basis of estimated useful life.

- Certain plants, subassemblies at Dora and Hoskote unit having limited life span of three years which have been written off over such life span.

The assets costing up to Rs 5,000 are fully depreciated in the year of purchase. Leasehold properties are amortized over the period of respective lease.

f) Revenue/Purchase Recognition

Revenue is recognized to the extent that it is probabale that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenus is recognized:

Sale of goods

Revenue from sale of goods is recognised when all the significant risk and rewards of ownrship of the goods have been passed to the buyer, usually on the delivery of the goods. The company collects sales tax and value added tax on behalf of the governement, therefore, these are not economic benefits flowing to the company, hence, these are excluded from the revenue. Further Trade discounts are excluded from the Revenue. Excise duty deducted from Revenue (Gross) is the amount that is included in the revenue (Gross) and not the entire amount of liability arising during the year.

Interest

Dividend

Dividend income from investments is recognised when the company's right to receive dividend is established by the reporting date.

Other Income

Export incentives and Rental Incomes are accounted on accrual basis.

Claims are accounted on acknowledgement from the appropriate authority.

Purchase of material is recognized on the basis of receipt of material in the factory premises.

g) Borrowing Cost

Borrowing costs includes Interest, Amortisation of ancialliary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

h) Investments

Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as Current Investments. All other investments are classified as Long Term Investments.

Initial Recognition

All investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Carrying Amount of Investments

- Current Investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis.

- Long Term Investments are carried at cost. However, provision for diminution in value is made to recognised a decline other than temporary in the value of the investments.

Disposal of Investments

The difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

i) CENVAT and Excise Duty

j) Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows:

Raw Materials, Stores, Spares and Packing Material Cost includes purchase price, non refundable duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis. Stock-in-process and Finished Goods Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods Cost includes purchase, duties, taxes and all other costs incurred in bringing the inventory to their present location. Cost is determined on First In First Out (FIFO) basis.

k) Translation of Foreign Currency items Initial Recognition

Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction. Exchange Differences Any income or expense on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss in the period in which they arise.

Conversion

l) Taxes on Income

Tax expense comprises current tax and deferred tax.

Current Tax

Current Tax is measured is expected to be paid to the tax authorities in accordance with the provisions of the Income Tax Act, 1961. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss.

Deferred Tax

Deferred tax reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current Income Tax relating to the items recognised directly in equity is recognised in equity and not in the statement of Profit and Loss. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

Minimum Alternate Tax

Minimum Alternate Tax (MAT) paid in the year is charged to the statement of profit and loss as current tax. The company recognises MAT credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which company recognises MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternate Tax under the Income Tax Act, 1961, the said asset is created by way of credit to the statement of Profit and Loss and shown as "MAT Credit entitlement ". The company reviews the "MAT credit entitlement1 asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

m) Employee Benefits

Short-term employee benefits are recognized as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which related service is rendered. Terminal benefits are recognized as an expense immediately.

Defined Contribution Plan

The company has defined contribution plans for the post employment benefits' namely provident fund and employee state insurance scheme. The company contributions in the above plans are charged to revenue every year.

Defined Benefit Plan

The company has defined benefit plans namely leave encashment/ compensated absence and gratuity for employees. Gratuity liability is a defined benefit obligation and is provided for on the basis of the actuarial valuation made at the end of each year.

- The company through its trust has taken a policy, for employees of Head Office and Sikandrabad Unit, with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees. The difference between the actuarial valuation of the gratuity of the employees at the year-end and the balance of funds with Kotak Mahindra Old Mutual Life Insurance Ltd. is provided for as liability in the books. For the employees at Dora and Hoskote unit, company has taken an Employees' Gratuity Scheme which is a defined benefit plan of Life Insurance Corporation of India. The company contributes to the fund on the basis of the year - end liability acturially determined in pursuance of the scheme.

- Certain employees of Dora and Hoskote Unit are covered by a superannuation fund benefit of Life Insurance Corporation of India at a company contribution 15% of basic salary. This is a defined contribution scheme and the contributions are charged to Statement of Profit and Loss of the year when the contribution to the fund is due. There are no obligations other than the contribution payable to the fund.

- Provisions for leave encashment is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.

Actuarial gains/losses are immediately taken to Statement of Profit and Loss.

n) Impairment of Assets

Impairment losses of continuing operations, including impairment on Inventories, are recognised in the statements of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to Revaluation Reserve. In this case, the impairment is also recognised in the revaluation reserve upto the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets's recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in statement of profit and loss unless the asset is carried at a revalued amount, in which case the reversal is treated as revaluation increase.

o) Provision, Contingent Liabilities and Contingent Assets

p) Lease

Leases, where lessor effectively retains all the substantially all the risk and benefits of ownership of the leased item, are classified as Operating Lease. Operating lease payments are recognised as an expense in the statement of profit and loss on straight - line- basis over the leased term.

q) Earning Per Share

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

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

r) Cash flow Statement

Cash flow statement is prepared as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by Companies (Accounting Standard) Rules, 2006.

Mar 31, 2011

1. Accounting Convention

The financial statements are prepared on the accrual basis under the historical cost convention in accordance with applicable mandatory accounting standards issued by Companies (accounting standard) rules, 2006 and the relevant provisions of the Companies act, 1956.

2. Use of Estimates

the preparation of financial statements in conformity with Generally accepted accounting Principles requires making of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

3. Fixed Assets

- Fixed assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of recoverable taxes and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use.

- Glow-sign Boards, which have no salvage value is charged to the Profit & Loss account.

4. Intangible Assets

all expenditures, qualifying as intangible assets are amortized over estimated useful life. specialized softwares are amortized over a period of 3 years.

5. Depreciation/ Amortization

- depreciation is provided on straight-line method at the rates and in the manner prescribed in schedule XiV to the Companies act, 1956.

- the assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

- Leasehold properties are amortized over the period of respective lease.

6. Revenue/Expense Recognition

- Local sales are recognized at the point of dispatch of goods to the customers. it includes excise duty but excludes sales tax and trade discount.

-export sales are recognized on the basis of bill of lading date.

-export incentives are accounted on accrual basis.

- Claims are accounted on acknowledgement from the appropriate authority.

-Purchase of material is recognized on the basis of receipt of material in the factory premises.

-interest is recognized on time proportion basis.

7. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of qualifying fixed assets are capitalized as part of the cost of assets. all other borrowing costs are recognized as expense in the year in which they are incurred.

8. CENVAT and Excise Duty

- CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

- excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the company as at the end of financial year.

9. Inventories

inventories are valued at the lower of cost and net realisable value. the cost of various components of inventory is determined as follows:

Raw materials, stores, spares and Cost includes purchase price, Packing Matrial non refundable duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First in First Out (FIFO) basis.

Stock-in-process and Finished Cost includes material cost and Goods also includes an appropriate portion of allocable overheads.

Traded Goods Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First in First Out (FIFO) basis.

10. Translation of Foreign Currency items

-Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction.

-Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account in the period in which they arise.

-Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

11. Taxes on Income

-Income-tax expense comprises current tax and deferred tax charge or release.

-Current tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the income tax act, 1961.

-Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employee Benefits

-Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit or loss account of the year in which related service is rendered.

-The company has defined contribution plans for the post employment benefits' namely provident fund and employee state insurance scheme. the company contributions in the above plans are charged to revenue every year.

-The company has defined benefit plans namely leave encashment/ compensated absence and gratuity for employees. Gratuity liability is a defined benefit obligation and is provided for on the basis of the actuarial valuation made at the end of each year.

- The company through its trust has taken a policy with Kotak mahindra Old mutual Life insurance Ltd. to cover the gratuity liability of the employees. the difference between the actuarial valuation of the gratuity of the employees at the year-end and the balance of funds with Kotak Mahindra Old mutual Life insurance Ltd. is provided for as liability in the books.

-Actuarial gains/losses are immediately taken to Profit and Loss account.

-Provisions for leave encashment is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.

-Terminal benefits are recognized as an expense immediately.

13. Impairment of Assets

an asset is treated as impaired when the carrying cost of assets 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 recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

14. Provision, Contingent Liabilities and Contingent Assets

15. Lease

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Earning Per Share

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

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

17. Cash flow Statement

Cash flow statement is made as per the indirect method prescribed under accounting standard-3 "Cash Flow statement" issued by Companies (accounting standard) rules, 2006.

Mar 31, 2010

1. Accounting Convention

The financial statements are prepared on the accrual basis under the historical cost convention in accordance with applicable mandatory accounting standards issued by Companies (Accounting Standard) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

3. Fixed Assets

- Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of CENVAT and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use.

- Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. The following norms are followed for the amortization for the Intangible Assets. - Specialized Softwares 3 Years

5. Depreciation

- Depreciation is provided on straight-line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

- The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

- Leasehold lands are amortized over the period of respective lease.

6. Revenue/Expense Recognition

- Local sales are recognized at the point of dispatch of goods to the customers. It includes excise duty but excludes sales tax and trade discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

- Export Sales are recognized on the basis of bill of lading date.

- Export incentives are accounted on accrual basis.

7. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of qualifying fxed assets are capitalized as part of the cost of assets. All other borrowing costs are recognized as expense in the year in which they are incurred.

8. CENVAT and Excise Duty

- CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

- Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses of the company as at the end of financial year.

9. Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows:

Cost includes purchase price, duties, taxes and all other Raw Materials, Stores, Spares and costs incurred in bringing the inventories to their present Packing Material location. Cost is determined on First In First Out (FIFO)

basis.

Cost includes material cost and also includes an Stock-in-process and Finished Goods

appropriate portion of allocable overheads.

Cost includes purchase price, duties, taxes and all other

costs incurred in bringing the inventories to their present Traded Goods location. Cost is determined on First In First Out (FIFO)

basis.

10. Translation of Foreign Currency items

- Transactions denominated in Foreign Currencies are recorded at the exchange rate prevailing at the time of the transaction.

- Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account in the period in which they arise.

- Items denominated in foreign currency at the year end and not covered by forward exchange contracts are translated at year end rates and those covered by forward exchange contracts are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such difference having been recognized over the life of the contract.

11. Taxes on Income

- Income-tax expense comprises current tax and deferred tax charge or release. Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.Deferred tax resulting from timing difference between book and taxable proft is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employees Benefits

- Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit or loss account of the year in which related service is rendered.

- The company has defined contribution plans for the post employment benefts namely provident fund and employee state insurance scheme. The company contributions in the above plans are charged to revenue every year.

- The company has Defined Benefit Plans namely leave encashment /compensated absence and gratuity for employees. Gratuity liability is a defined benefit obligation and is provided for on the basis of the actuarial valuation made at the end of each year. However, the company through its trust has taken a policy with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees. The difference between the actuarial valuation of the gratuity of the employees at the year-end and the balance of funds with Kotak Mahindra Old Mutual Life Insurance Ltd. is provided for as liability in the books.

- Actuarial gains/losses are immediately taken to Profit and Loss account.

- Provisions for leave encashment is accrued and provided for on the basis of an actuarial valuation made at the end of each fnancial year.

- Terminal benefits are recognized as an expense immediately.

13. Impairment of Assets

An asset is treated as impaired when the carrying cost of assets 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 recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

14. Provision, 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.

15. Lease

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Earning Per Share

- Basic Earning per share is calculated by dividing the net proft or loss for the period attributable to equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year.

- For the purpose of calculating Diluted Earning per share, the net proft or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

17. Cash flow Statement

Cash flow statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by Companies (Accounting Standard) Rules, 2006.

18. Segment Reporting

- The company is engaged in manufacture of Ceramic and Vitrified Tiles. The entire operations are governed by same set of risk and returns; hence, the same has been considered representing a single primary segment. The said treatment is in accordance with the guiding principles enunciated in the Accounting Standard-17 on segment reporting.

- The company sells its products mostly within India with insignifcant export income and does not have any operations in economic environments with different risk and returns, hence, its considered operating in single geographical segment.

Mar 31, 2009

1. Accounting Convention

The financial statements are prepared on the accrual basis under the historical cost convention in accordance with applicable mandatory accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognized in the year in which the results are known / materialized.

3. Fixed Assets

- Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

5. Depreciation

- Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

- The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

- Leasehold lands are amortized over the period of respective lease.

6. Revenue / Expense Recognition

- Local sales are recognised at the point of dispatch of goods to the customers. It includes excise duty but excludes sales tax and trade discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

- Export Sales are recognized on the basis of bill of lading date.

- Export incentives are accounted on accrual basis.

7. Borrowing Cost

8. CENVAT and Excise Duty

- CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

10. Translation of Foreign Currency Items

- The exchange differences arises on the settlement of monetary items or on reporting these items at rates different from rates at which these were initially recorded / reported in previous financial statement are recognized as income/ expense in the period in which they arise.

- Monetary items denominated in foreign currency are reported using the closing exchange rate on each Balance Sheet date.

- In case of forward exchange contracts, the premium or discount arising at the inception of such contracts, is amortized as income or expense over the life of the contract as well as exchange difference on such contracts i.e. difference between the exchange rates at the reporting / settlement date and the exchange rate on the date of inception of contract / the reporting date, is recognized as income / expense for the period.

11. Taxation

- Income-tax expense comprises current tax and deferred tax charge or release. Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961. Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employees Benefits

- Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit or loss account of the year in which related service is rendered.

- The Company has defined contribution plans for the post employment benefits namely provident fund and employee state insurance scheme. The Company contributions in the above plans are charged to revenue every year.

- The Company has Defined Benefit Plans namely leave encashment / compensated absence and gratuity for employees. Gratuity liability is a defined benefit obligation and is provided for on the basis of the actuarial valuation made at the end of each year. However, the Company through its trust has taken a policy with Kotak Mahindra Old Mutual Life Insurance Ltd. to cover the gratuity liability of the employees. The difference between the actuarial valuation of the gratuity of the employees at the year-end and the balance of funds with Kotak Mahindra Old Mutual Life Insurance Ltd. is provided for as liability in the books.

- Actuarial gains / losses are immediately taken to Profit and Loss account.

- Provisions for leave encashment is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.

- Terminal benefits are recognized as an expense immediately.

13. Impairment of Assets

14. 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.

15. Leases

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Cash Flow Statement

Cash Flow Statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued bv the Institute of Chartered Accountants of India.

Mar 31, 2008

1. Accounting Convention

2. Use of Estimates

3. Fixed Assets

- Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

5. Depreciation

- Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

- The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

- Leasehold lands are amortized over the period of respective lease.

6. Revenue / Expense Recognition

- Local Sales are recognised at the point of dispatch of goods to customers. It includes excise duty but excludes sales tax and trade / quantity discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

- Export Sales are recognized on the basis of bill of lading date.

- Export incentives are accounted on accrual basis.

7. Borrowing Cost

8. CENVAT and Excise Duty

- CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

10. Translation of Foreign Currency Hems

- Monetary items denominated in foreign currency are reported using the closing exchange rate on each Balance Sheet date.

11. Taxation

- Income-tax expense comprises current tax and deferred tax charge or release. Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961 .Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employee Benefits

Short-term employee benefits are recognized as an expense at the undiscounted amount in the profit or loss account of the year in which related service is rendered.

- Actuarial gains / losses are immediately taken to Profit and Loss account.

- Provisions for leave encashment is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.

- Terminal benefits are recognized as an expense immediately.

13. Impairment of Assets

14. 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.

15. Leases

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Cash Flow Statement

Cash Flow Statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2007

1. Accounting Convention

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognised in the year in which the results are known / materialised.

3. Fixed Assets

" Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of CENVAT and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use.

" Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. The following norms are followed for the amortisation for the Intangible Assets. - Specialized Softwares : 3 Years

5. Depreciation

Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

Leasehold lands are amortised over the period of respective lease.

6. Revenue / Expense Recognition

Local Sales are recognised at the point of dispatch of goods to customers. It includes excise duty but excludes sales tax and trade / quantity discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

Export Sales are recognized on the basis of bill of lading date.

Export incentives are accounted on accrual basis.

7. Borrowing Cost

8. CENVAT and Excise Duty

CENVAT credit availed has been credited to the respective cost of stores & spares and capital goods.

Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses within the factory premises as at the end of financial year.

9. Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows :

Raw Materials, Stores, Cost includes purchase price, duties, taxes and all other costs incurred in bringing Spares and the inventories to their present location. Cost is determined on First In First Out Packing Material (FIFO) basis. Stock-in-Process and Cost includes material cost and also includes an appropriate portion of allocable Finished Goods overheads. Traded Goods Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

10. Translation of Foreign Currency Items

Transactions in Foreign Currency are accounted for at the exchange rate prevailing at the time of transaction. Gains / losses arising out of fluctuations in foreign exchange rates between the transaction date and settlement date are recognised in the profit and loss account, except where the foreign currency liabilities have been incurred in connection with fixed assets acquired from a country outside India, where the exchange difference are adjusted in the carrying amount of concerned fixed assets.

Monetary items denominated in foreign currency are reported using the closing exchange rate on each Balance Sheet date.

In case of forward exchange contracts, the premium or discount arising at the inception of such contracts, is amortised as income or expense over the life of the contract as well as exchange difference on such contracts i.e. difference between the exchange rates at the reporting / settlement date and the exchange rate on the date of inception of contract / the reporting date, is recognized as income / expense for the period except where the foreign currency liabilties have been incurred in connection with fixed assets acquired from a country outside India, where the exchange difference are adjusted in the carrying amount of concerned fixed assets.

11. Taxation

Income-tax expense comprises current tax and deferred tax charge or release. Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employee Retirement Benefits

Retirement benefits to Employees viz. Provident Fund, Pension Scheme etc. are accounted on accrual basis and charged to Profit and Loss account for the year.

The provision for cost in respect of leave encashment and gratuity to eligible employees is made on the basis of an actuarial valuation.

13. Impairment of Assets

An Asset is treated as impaired when the carrying cost of assets 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 recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

14. 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.

15. Leases

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Cash Flow Statement

Cash Flow Statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2006

1. Accounting Convention

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognised in the year in which the results are known/ materialised.

3. Fixed Assets

* Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of CENVAT and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use.

* Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life, The following norms are followed for the amortisation for the Intangible Assets.

Specialized Softwares : 3 Years

5. Depreciation

* Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

* The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

* Leasehold lands are amortised over the period of respective lease.

6. Revenue/Expense Recognition

* Local Sales are recognised at the point of dispatch of goods to customers. It includes excise duty but excludes sales tax and trade/ quantity discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

* Export Sales are recognized on the basis of bill of lading date.

* Export incentives are accounted on accrual basis.

7. Borrowing Cost

8. CENVAT and Excise Duty

* CENVAT credit availed has been credited to the respective cost of raw materials, stores & spares and capital goods.

* Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouses within the factory premises as at the end of financial year.

9. Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows :

Raw Materials, Stores, Spares and Packing Material

Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-Process and Finished Goods

Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods

Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

10. Translation of Foreign Currency Items

* Transactions in Foreign Currency are accounted for at the exchange rate prevailing at the time of transaction. Gains/losses arising out of fluctuations in foreign exchange rates between the transaction date and settlement date are recognised in the profit and loss account, except where the foreign currency liabilities have been incurred in connection with fixed assets acquired from a country outside India, where the exchange difference are adjusted in the carrying amount of concerned fixed assets.

* Monetary items denominated in foreign currency are reported using the closing exchange rate on each Balance Sheet date.

* In case of forward exchange contracts, the premium or discount arising at the inception of such contracts, is amortised as income or expense over the life of the contract as well as exchange difference on such contracts i.e. difference between the exchange rates at the reporting/settlement date and the exchange rate on the date of inception of contract/the reporting date, is recognized as income/expense for the period except where the foreign currency liabilties have been incurred in connection with fixed assets acquired from a country outside India, where the exchange difference are adjusted in the carrying amount of concerned fixed assets.

11. Taxation

* Income-tax expense comprises current tax and deferred tax charge or release. Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

* Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Such assets are reviewed as at each balance sheet date to re-assess realization.

12. Employee Retirement Benefits

* Retirement benefits to Employees viz. Provident Fund, Pension Scheme etc. are accounted on accrual basis and charged to Profit and Loss account for the year.

* The provision for cost in respect of leave encashment and gratuity to eligible employees is made on the basis of an actuarial valuation.

13. Impairment of Assets

14. 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.

15. Leases

Lease rentals in respect of assets taken under operating lease are charged to profit and loss account as per the terms of the lease agreement.

16. Cash Flow Statement

Cash Flow Statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2005

I) SIGNIFICANT ACCOUNTING POLICIES

1. Accounting Convention

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognised in the year in which the results are known/materialised.

3. Fixed Assets

* Glow-sign Boards, which have no salvage value is charged to the Revenue Account.

4. Intangible Assets

All expenditures, qualifying as Intangible Assets are amortized over estimated useful life. The following norms are followed for the amortisation for the Intangible Assets

- Specialized Softwares 3 Years

5. Depreciation

Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

* The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

* Leasehold lands are amortised over the period of respective lease.

6. Revenue/Expense Recognition

* Local Sales are recognised at the point of dispatch of goods to customers. It includes excise duty but excludes sales tax and trade/quantity discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

* Export Sales are recognized on the basis of shipping bill date.

* Export incentives are accounted on accrual basis.

7. Borrowing Cost

8. CENVAT and Excise Duty

* CENVAT credit availed has been credited to the respective cost of raw materials, stores & spares and capital goods.

9. Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows :

Raw Materials, Stores, Spares and Packing Material :

Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-Process and Finished Goods :

Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods :

Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location Cost is determined on First In First Out (FIFO) basis.

10. Translation of Foreign Currency Items

* Monetary items denominated in foreign currency are reported using the closing exchange rate on each Balance Sheet date.

* In case of forward exchange contracts, the premium or discount arising at the inception of such contracts, is amortised as income or expense over the life of the contract as well as exchange difference on such contracts i.e. difference between the exchange rates at the reporting/settlement date and the exchange rate on the date of inception of contract/the reporting date, is recognized as income/expense for the period except where the foreign currency liabilities have been incurred in connection with fixed assets acquired from a country outside India, where the exchange difference are adjusted in the carrying amount of concerned fixed assets.

11. Taxation

* Income-tax expense comprises current tax and deferred tax charge or release Current Tax is the amount of tax payable on taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961

12. Employee Retirement Benefits

* Retirement benefits to Employees viz. Provident Fund, Pension Scheme etc are accounted on accrual basis and charged to Profit and Loss account for the year.

* The provision for cost in respect of leave encashment and gratuity to eligible employees is made on the basis of an actuarial valuation.

13. Cash Flow Statement

Cash Flow Statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2004

1. Accounting Convention

2. Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires making of estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between the actual results and estimates are recognised in the year in which the results are known/materialised.

3. Fixed Assets

Fixed Assets are recorded at their original cost of acquisition less accumulated depreciation. Cost is net of CENVAT and inclusive of freight, duties, taxes and other directly attributable costs incurred to bring the assets to their working condition for intended use.

4. Depreciation

* Depreciation is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

* The assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

* Leasehold lands are amortised over the period of respective lease.

5. Revenue/Expense Recognition

* Local Sales are recognised at the. point of dispatch of goods to customers. It includes excise duty but excludes sales tax and trade/quantity discount. Purchase of material is recognized on the basis of receipt of material in the factory premises.

* Export Sales are recognized on the basis of shipping bill date.

* Export incentives are accounted on accrual basis.

6. Borrowing Cost

7. CENVAT and Excise Duty

* CENVAT credit availed has been credited to the respective cost of raw materials, stores & spares and capital goods.

* Excise duty has been accounted for on the basis of payments made in respect of goods cleared from the factory premises and provision made in the accounts for goods manufactured, which are lying in the bonded warehouse within the factory premises as at the end of financial year.

8. Inventories

Inventories are valued at the lower of cost and net realisable value. The cost of various components of inventory is determined as follows :

Raw Materials, Stores, Spares and Packing Material Cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

Stock-in-Process and Finished Goods Cost includes material cost and also includes an appropriate portion of allocable overheads.

Traded Goods cost includes purchase price, duties, taxes and all other costs incurred in bringing the inventories to their present location. Cost is determined on First In First Out (FIFO) basis.

9. Translation of Foreign Currency Items

* Transactions in Foreign Currency are accounted for at the exchange rate prevailing at the time of transaction. Gains/losses arising out of fluctuations in foreign exchange rates between the transaction date and settlement date are recognised in the profit and loss account, except in the case of fixed assets, where these are adjusted to the carrying cost of the respective assets.

* Monetary items denominated in foreign currency are restated at the exchange rate prevailing at the year end and the overall net gain/loss is adjusted to the profit and loss account, except in the case of liabilities relating to acquisition of fixed assets, which are adjusted to the carrying cost of the relative assets.

* The difference between the forward exchange contract rate and the spot rate is recognized as income or expense over the life of the contract, except in cases where they relate to the acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

10. Taxation

11 Employee Retirement Benefits

* Retirement benefits to Employees viz. Provident Fund, Pension Scheme etc. are accounted on accrual basis and charged to Profit and Loss account for the year.

* The provision for cost in respect of leave encashment and gratuity to eligible employees is made on the basis of an actuarial valuation.

12. Cash Flow Statement

Cash Flow statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2003

A. Basis of Preparation of Financial Statements

The Company follows accrual system of accounting. The financial statements are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition net of CENVAT inclusive of all incidental expenditure incurred for the acquisition / construction / installation, adjusted by revaluation of Assets, if any, Less accumulated depreciation.

(ii) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued component of fixed assets is charged to revaluation reserve.

C. Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction or production of a qualifying asset are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use and will result in future economic benefits to the enterprise and the costs can be measured reliably. All other borrowing costs are recognised as an expense in the period in which they are incurred.

D. Cenvat and Excise Duty

(i) Cenvat credit taken / available has been credited to the respective cost of raw materials, stores & spares and capital goods.

(ii) Excise duty has been accounted for on the basis of payments made in respect of goods cleared and Provision made in the accounts for goods manufactured and lying in the bonded warehouse within the factory premises.

E Inventories

Inventories are valued as follows :

(i) Raw Materials, Stores, Spares and Components are valued at cost. Cost is determined on the basis of the FIFO method and includes all costs incurred in bringing the inventories to their present location.

(ii) Stock-in-process are valued at raw material cost plus appropriate allocable overheads and finished Goods are valued at lower of cost or estimated realisable value.

(iii) Cost of finished goods and stock-in-process are determined by considering material, labour and related overheads, including depreciation.

(iv) Stock of traded goods are valued at purchase cost and cost is determined on the basis of FIFO method.

F. Revenue Recognition

(i) Local Sales are recognised at the time of despatches to customers and recorded net of Sales Tax, trade / quantity discount and inclusive of Excise Duty.

(ii) Export Sales are recognized on the basis of shipping bill date.

(iii) Export incentives are accounted on accrual basis.

G. Foreign Currency Transactions

(i) Transactions in Foreign Currency are recorded at the exchange rate prevailing at the time of transaction. Any income or expense on account of exchange difference is recognised in the profit and loss account except in cases where they relate to the acquisition of fixed assets in which case they are adjusted to the carrying cost of such related assets.

(ii) The difference between the forward exchange contract rate and the exchange rate on the date of the transaction is recognized as income or expense over the life of the contract, except in cases where they relate to the acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

H. Deferred Revenue Expenditure

(i) Engineering / know-how are amortised over a period of six years.

(ii) Advertisement expenses on Exhibitions & Media in respect of the new product of the Company, though of revenue nature are being amortised over a period of 5 years. Since it is estimated that the benefits of the same shall continue to accrue for the Company.

I. Employee Retirement Benefits

(i) Retirement benefits to employee viz. Provident fund, Pension Scheme, whether in pursuance of any law or otherwise are accounted on accrual baste and charged to Profit and Loss account for the year. Contribution to Provident Fund is being made to an approved Provident Fund Institution maintained by the Company.

(ii) Payment for present liability of future payment of gratuity is made on the basis of acturial valuation and charged to profit and loss account for the year.

(iii) Provision for accrued leave encashment is made on the basis of Companys own policy and charged to profit and loss account tor the year.

J. Taxation

(i) Current Year Tax

The current year tax has been charged to Profit and Loss account on the basis of assessable profits of the company, as computed under the Income Tax Act 1961.

(ii) Deferred Tax

Deferred tax resulting from timing difference between book and taxable profit is accounted for using the tax rates and laws that nave been enacted or substantivety enacted as on the balance sheet date. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

K. Cash Flow Statement

Cash Flow statement is made as per the indirect method prescribed under Accounting Standard-3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

Mar 31, 2002

A. Basis of Preparation of Financial Statements

The Company follows accrual system of accounting. The financial statements are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition net of MODVAT inclusive of all incidental expenditure incurred for the acquisition/construction/installation, adjusted by revaluation of Assets, if any, Less accumulated depreciation.

C. Borrowing Cost

D. Modvat & Excise Duty

(i) Modvat credit taken/available has been credited to the respective cost of raw materials, stores & spares and capital goods.

(ii) Provision for excise duty is made in the accounts for goods manufactured and lying in the bonded warehouses within the factory premises.

E. Inventories

Inventories are valued as follows:

(i) Raw Materials, Stores, Spares and Components are valued at cost. Stock in process are valued at raw material cost plus appropriate allocable overheads and Finished Goods are valued at lower of cost or estimated realisable value.

(ii) Cost of finished goods and stock in process are determined by considering material, labour and related overheads, including depreciation.

F. Revenue Recognition

Local Sales are recognised at the time of despatches to customers and recorded net of Sales Tax and inclusive of Excise Duty.

Export Sales are recognized on the basis of shipping bill date.

G. Foreign Currency Transactions

(ii) Monetary items denominated in foreign currencies and not covered by forward exchange contract are translated at the year end rates.

H. Deferred Revenue Expenditure

(i) Debenture issue expenses are amortised over a period of ten years.

(ii) Engineering/know-how expenses are amortised over a period of six years.

(iii) Advertisement expenses on Exhibitions & Media in respect of the new product of the Company, though of revenue nature are being amortised over a period of 5 years keeping in view of the benefits of the same shall continue to accrue for the Company.

I. Employee Retirement Benefits

Retirement benefits to employee viz. Provident Fund, Leave Encashment are accounted for on accrual basis. Liability for payment of gratuity is determined on the basis of valuation done by an independent actuary.

J. Taxation

(i) Current Year Provision

The provision for taxation for the current year has been made on assessable profits of the Company, as computed under the Income Tax Act, 1961.

(ii) Deferred Tax

Deferred tax is calculated at current statutory Income tax rate and is recognized on timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent period. Deferred tax assets subject to consideration of prudence, are recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

Mar 31, 2001

A. Basis of Preparation of Financial Statements

The Company generally follows mercantile system of accounting and recognise significant items of income and expenditure on accrual basis. The financial statements are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition net of MQDVAT inclusive of all incidental expenditure incurred for the acquisition/construction/installation, adjusted by revaluation of Building and Plant & Machinery Less accumulated depreciation.

(ii) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued part of the Building and Plant & Machinery are charged to revaluation reserve.

C. Borrowing Cost

D. Modvat & Excise Duty

(i) Modvat credit taken/available has been credited with the respective cost of raw materials, stores & spares and capital goods.

(ii) Excise Duty is accounted on the accrual basis. Accordingly, provision for excise duty is made in the accounts for goods manufactured and lying in the bonded warehouses within the factory premises.

E. Inventories

(i) Inventories are valued as follows :

Raw Materials, Stores. Spares and Components are valued at cost. Stock in process are valued at raw material cost. Finished Goods are valued at lower of cost or estimated realisable value.

(ii) Cost of finished goods is determined by considering material, labour and related overheads, including depreciation.

F. Revenue Recognition

Sales are recognised at the time of despatches to customers and recorded net of Sales Tax but includes Excise Duty.

G. Export Benefits

Duty benefits on import of various materials against exports made by the Company are accounted for in the year of such export.

H. Foreign Currency Transactions

(ii) Monetory items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rates.

I. Miscellaneous Deferred Revenue Expenditure

(i) Debenture issue expenses are amortised over a period of ten years.

(ii) Engineering/know-how are amortised over a period of six years.

J. Employee Retirment Benefits

Retirement benefits to employee viz. Provident Fund, Leave Encashment are accounted for on accrual basis. The Company has taken Group Gratuity Policy for part liability of gratuity and for balance liability provision has been made on the basis of valuation made by independent actuary.

Mar 31, 2000

A. Basis of Preparation of Financial Statements

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition net of MODVAT inclusive of all incidental expenditure incurred for the acquisition / construction / installation, adjusted by revaluation of Building and Plant & Machinery Less accumulated deprecation.

(ii) In case of the Fixed Assets acquired out of Foreign Currency Loans, the additional liability on account of fluctuation in exchange rates has been capitalised. The outstanding Foreign Currency Loans have been converted at rates prevailing at the year end by corresponding debit to the respective Fixed Assets.

(iii) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued part of the Building and Plant & Machinery are charged to revaluation reserve.

C. Modvat & Excise Duty

(i) Modvat credit taken / available has been credited with the respective cost of raw materials, stores & spares and Capital goods.

D. Inventories

(i) Inventories are valued as follows :

Raw Materials, Stores, Spares and Components are valued at cost. Stock in process are valued at raw material cost. Finished Goods are valued at lower of cost or estimated realisable value.

(ii) Cost of finished goods is determined by considering material, labour and related overheads, including depreciation.

E. Revenue Recognition

Sales are recognised at the time of despatches to customers and recorded net of Sales Tax but includes Excise Duty.

F. Export Benefits

Duty benefits on import of various materials against exports made by the Company are accounted for in the year of such export.

G. Foreign Exchange Transactions

(ii) Monetory items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rates.

H. Miscellaneous Deferred Revenue Expenditure

(i) Debenture issue expenses are amortised over a period of ten years.

(ii) Engineering / know-how are amortised over a period of six years.

I. Retirement Benefits

Retirement benefits to employee viz. Provident Fund, Leave Encashment are accounted for on accrual basis. The Company has taken policy from Life Insurance Corporation of India for part liability of Gratuity and for balance liability provision has been made on the basis of valuation made by independent actuary.

Mar 31, 1999

A. Basis of Preparation of Financial Statements

The Company generally follows mercantile system of accounting and recognise significant items of income and expenditure on accrual basis. The Financial Statements are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition net of MODVAT inclusive of all incidental expenditure incurred for the acquisition / construction / installation, adjusted by revaluation of Building and Plant & Machinery Less accumulated depreciation.

Modvat credit taken / available has been credited with the respective cost of raw materials, stores & spares and Capital goods.

D. Inventories

(i) Stores, Spares and Components are valued at cost.

(ii) Raw Materials are valued at cost.

(iii) Stock in process are valued at raw material cost.

(iv) Finished Goods are valued at lower of prime cost or estimated realisable value. Cost for the purpose of valuation of stores and raw materials arrived on the first in first out (FIFO) basis.

E. Revenue Recognition

Sales are recognised at the time of despatches to customers.

F. Excise Duty

Excise Duty is accounted for at the time of clearance of goods.

G. Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at the exchange rate prevailing at the time of transaction. Any income or expense on account of exchange difference is recognised in the profit & loss account except in cases where they relate to the acquisition of Fixed Assets in which case they are adjusted to the carrying cost of such assets.

H. Miscellaneous Deferred Revenue Expenditure

i) Debenture Issue expenses are amortised over a period of ten years. However, any subsequent expenditures are also amortised in equal instalments over the remaining period.

ii) Engineering / Know-how are amortised over a period of six years. However, any subsequent expenditure relating to same set of Engineering / Know-how is also amortised in equal instalments over the remaining period.

iii) Advertisement expenses on Exhibitions & Media in respect of the new product of the Company, though of revenue nature are being amortised over a period of 5 years keeping in view of the benefits of the same shall continue to accrue for the Company.

I. Retirement Benefits

Retirement benefits to employee viz. Provident Fund, Leave Encashment are accounted for on accural basis. The Company has taken policy from LIC of India for part liability of Gratuity and for balance liability provision has been made on the basis of actuarial valuation.

Mar 31, 1998

1. Basis of Preparation of Financial Statements

The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis. The Financial statements are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

2. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition, net of MODVAT, inclusive of all incidental expenditure incurred for the acquisition/construction/installation, adjusted by revaluation of Building and Plant & Machinery, Less accumulated depreciation.

(ii) In case of the Fixed Assets acquired out of Foreign Currency Loans, the additional liability on account of fluctuation in exchange rates has been capitalised. The outstanding Foreign Currency loans have been converted at rates prevailing at the year end by corresponding debit to the respective Fixed Assets.

iii) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued part of the Building and Plant & Machinery are charged to revaluation reserve.

(iv) Pre-operative expenses are allocated to the respective assets acquired for expansion on pro-rata basis. Interest on borrowing relating to the acquisition of fixed assets is capitalised up to the period such assets are put to use for commercial production.

3. Modvat

Modvat credit taken/available has been credited with the respective cost of raw materials, stores & spares and Capital goods.

4. Investments

Investments are stated at cost.

5. Inventories

(i) Stores, Spares and Components are valued at cost.

(ii) Raw Materials are valued at cost.

(iii) Stock in process are valued at raw material cost.

(iv) Finished Goods are valued at lower of prime cost or estimated realisable value. Cost for the purpose of valuation of stores and raw material arrived on the first in first out (FIFO) basis.

6. Revenue Recognition

Sales are shown inclusive of excise duty and transportation charges realised from the parties.

7. Excise Duty

Excise Duty is accounted for at the time of clearance of goods.

8. Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at the exchange rate prevailing at the time of transaction. Any income or expense on account of exchange difference is recognised in the profit and loss account except in cases where they relate to the acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

9. Deferred Revenue Expenditure

a.) Debenture issue expenses are amortised over a period of ten years. However, any subsequent expenditures are also amortised in equal instalments over the remaining period.

b.) Engg./know-how are amortised over a period of six years. However any subsequent expenditure relating to same set of Engg./know-how is also amortised in equal instalments over the remaining period.

10. Retirement Benefits

Retirement benefits to employee viz., Provident Fund, Leave encashment are accounted for on accrual basis. The Company has taken policy from LIC of India for part liability of gratuity and for balance liability provision has been made on the basis of actuarial valuation.

Mar 31, 1997

A. Basis of preparation of financial statements

The Company generally follows mercantile system of accounting and recognise significant items of income and expenditure on accrual basis. The accounts are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

(i) Fixed Assets are stated at their original cost of acquisition inclusive of all incidental expenditure incurred for the acquisition/construction/installation adjusted by revaluation of Building and Plant & Machinery.

(ii) In case of fixed assets acquired out of Foreign Currency Loan, the additional liability on account of fluctuation in exchange rates has been capitalised. The outstanding Foreign Currency Loans have been converted at rates prevailing at the year end by corresponding debit to the respective Fixed Assets.

(iii) Pre-operative expenses have been allocated to the respective assets acquired for expansion on prorata basis. Interest on borrowing relating to the acquisition of fixed assets is capitalised up to the period such assets are put to use for commercial production.

(iv) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued part of the Building and Plant & Machinery are charged to revaluation reserve.

(v) The Company has not amortised the lease hold land in the lease period.

C. Modvat

Modvat credit taken/available has been adjusted with the respective cost of raw materials, stores & spares and capital goods.

D. Investments

Investments are stated at cost.

E. Inventories

(i) Stores, Spares and Components are valued at cost.

(ii) Raw Materials are valued at cost.

(iii) Stock in process are valued at raw material cost.

(iv) Finished goods are valued at lower of prime cost or estimated realisable value.

Cost for the purpose of valuation of stores and raw material arrived on the first in first out (FIFO) basis.

F. Revenue Recognition

Sales inclusive of excise duty and transportation charges realised from the parties.

G. Excise Duty

Excise Duty is accounted for at the time of clearance of goods.

H. Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at the exchange rate prevailing at the time of transaction. Any income or expense on account of exchange difference is recognised in the profit and loss account except in cases where they relate to the acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

I. Retirement Benefits

Retirement benefits to employee viz. provident fund, leave encashment are accounted for on accrual basis. The Company has taken policy from LIC of India for part liability and for balance gratuity liability provision has been made on the basis of actuarial valuation.

Mar 31, 1996

A. Basis of preparation of financial statements

The Company generally follows mercantile system of accounting and recognised significant items of income and expenditure on accural basis. The accounts are prepared on historical cost basis as a going concern, and are consistent with generally accepted accounting principles.

B. Fixed Assets and Depreciation

i. Fixed Assets are stated at their original cost of acquisition inclusive of all incidental expenditure incurred for the acquisition construction/installation adjusted by revaluation of Building and Plant and Machinery.

ii Depreciation of Fixed Assets is provided on straight line method at the rate and in the manner prescribed in schedule XIV to the Companies Act, 1956. Depreciation in respect of revalued part of Building and Plant and Machinery are charged from revaluation reserve. The company has not amortised the lease hold land in the lease period.

C. Investments

Investments are stated at cost.

D. Inventories

i. Stores, Spares and Components are valued at cost.

ii Raw Materials are valued at cost.

iii Stock in process are valued at raw material cost.

iv Finished goods are valued at lower of prime cost or estimated realisable value.

Cost for the purpose of valuation of stores and raw material arrived on the first in first out (FIFO) basis.

E. Revenue Recognition

Sales inclusive of excise duty and transportation charges realised from the parties.

F. Excise Duty

Excise Duty is accounted for at the time of clearance of goods.

G. Foreign Exchange Transactions

Transactions in Foreign Currency are recorded at the exchange rate prevailing at the time of transaction. In case of liabilities incurred for the acquisition of fixed assets, the loss or gain on conversion (at the rate prevailing at the year end) is included in the carrying amount of the related fixed assets arid those relating to other account are recognised in the Profit and Loss account under respective heads of account.

H. Retirement Benefits

Retirement benefits to employees viz. provident fund, leave encashment are accounted for on accrual basis. The company has taken policy from LIC of India for part liability and for balance gratuity liability provision has been made on the basis of actuarial valuation.

I. Lease Rental Income

Lease rental income are accounted for on accrual basis.

Mar 31, 1995

1. Revenue Recognition

The company follows the accrual system of accounting to recognise Income and Expenditure.

2. Fixed Assets

Fixed Assets are stated at their Original Cost of acquisition inclusive of all incidental expenditure incurred for the acquisition, construction/installations, adjusted by revaluation of Building and Plant and Machinery.

3. Depreciation

Depreciation is provided on straight line method at the rates specified in Schedule XIV of the Companies Act, 1956.

Depreciation in respect of revalued part of Building and Plant and Machinery are charged from revaluation reserve.

The company has not amortised the lease hold Land in the lease period.

6. Investments

Investments are stated at cost.

5. Inventories

Inventories are valued on the Following basis

a) Stores and Spares - At Cost

b) Raw Material - At Cost

c) Stock in Process - At Raw Material Cost

d) Finished Goods - At Lower of Prime Cost or estimated realisable value

Cost for the purpose of valuation of Stores and Raw Material arrived on the first in first out (FIFO) basis

6. Excise

Excise duty is accounted for at the time of clearance of goods.

7. Sales

Sales inclusive of excise duty and transportation charges realised from the parties.

8. Foreign Currency transaction

Increase/Decrease in rupee liability due to fluctuation in exchange rates has been adjusted in Assets/Liabilities in respect of foreign currency loan at the rates prevailing on the last day of the balance sheet and for others the same is adjusted in revenue items.

9. Gratuity/Retirement Benefits

The company has taken policy from the Life Insurance Corporation of India for part liability and for the balance liability amount (as determined by the Actuary) provision has been made in the books of accounts.

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