Accounting Policies of Ricoh India Ltd. Company

Mar 31, 2015

1. Basis of Preparation of Financial Statements

The Financial Statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP), the Accounting Standards specified under Section 133 of the Companies Act, 2013 (the 'Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, and the relevant provisions of the Act. The Financial Statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of Financial Statements are consistent with those of previous year.

2. Fixed Assets and Depreciation

1) Fixed Assets are stated at cost less accumulated depreciation / amortization and impairment loss. Cost of Fixed Assets comprises purchase price, non refundable duties & levies and any directly attributable costs of bringing an asset to its working condition and location for its intended use. Depreciation on Fixed Assets is provided on the straight-line method based on estimated useful lives, as specified in Part "C" of Schedule II of the Companies Act, 2013 or as estimated by the management based on internal evaluation. Assets costing less than Rs. 5,000 are depreciated fully in the year of purchase.

2) Advance paid towards acquisition of Fixed Assets are disclosed under 'Long Term Loans and Advances', and cost of the assets not ready for intended use before the year end, are disclosed under 'Capital Work in Progress'.

3) The management's estimate of the useful lives of fixed assets is as follows:

Assets Useful lives (in years) Leasehold Land Over the Period of Lease

Goodwill 5

Buildings 30

Office Equipments 5

Computer Hardwares

- End User Devices 3

Electrical Installations 10

Furniture & Fixtures 10

Trade Mark 3

Estimated useful lives in case of below mentioned Fixed Assets are different from estimated useful lives as specified in Part "C" of Schedule II of Companies Act, 2013 which are as per management's estimates based on internal evaluation:

Airconditioners 10

Plant and Machinery 10

Computer Hardwares

- Servers and Networks 5

Computer Softwares 5

Vehicles 6

Machines Capitalized and Machines under Facilities Management Contracts 3

3. Impairment of Assets :

The carrying amounts of assets in use are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Recoverable amount of an asset or a cash generating unit is higher of its net selling price and value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. Impairment losses are recognized in the Statement of Profit and Loss. 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 asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

4. Inventories :

Inventories are valued at lower of cost and net realisable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Finished Goods

Trading Yearly Weighted Average Basis

5. Investments

Investments are classified into Current and Long Term Investments. Investments that are readily realisable and are 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". Current Investments are stated at the lower of cost and fair value. Long Term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of Long Term Investments.

6. Revenue Recognition

1) Sale of Goods: Revenue from sale of goods is recognised when all significant risks and rewards of ownership are transferred to the customer, usually on the delivery of goods, and are net of trade discounts, sales tax and excise duty

2) Rendering of Services: Income from services is included in turnover when the contractual commitment to the customer has been fulfilled and are net of trade discounts, service tax and works contract tax.

3) Interest Income: Interest Income is recognised on time proportion basis taking into account the amount outstanding and the applicable rate.

4) Dividend Income: Dividend income on investments is recognised when the right to receive payment is established.

7. Employee Benefits

1) Short term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related services are rendered.

2) Retirement benefits in the form of Superannuation / Pension is a defined contribution scheme and the contribution towards defined contribution scheme is charged to the Statement of Profit and Loss of the year when the contribution to the Fund is due. There is no obligation other than the contribution payable to the Fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through the Company's own Provident Fund Trust.

4) Gratuity is determined based on Actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognised in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an Actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are charged to Statement of Profit and Loss.

7) Termination benefits are recognized as an expense immediately.

8. Foreign Currency Transactions

Foreign exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Monetary assets and liabilities which are realisable and payable in foreign currency are translated at year-end rates. Non-monetary items denominated in foreign currencies are valued at the exchange rate prevailing at the date of transaction. Any resultant gain/ loss on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

In case of Forward Contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the Statement of Profit and Loss in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

9. Income Taxes

1) Current tax is the tax payable for the period determined in accordance with the provisions of the Income Tax Act, 1961. In case of matters under appeal due to disallowance or otherwise, provision is made when the said liabilities are accepted by the Company.

2) In accordance with the AS 22- "Accounting for Taxes on Income", the deferred tax for the timing differences between taxable income and accounting income, that originate in one period and is capable of reversal in one or more subsequent periods, is accounted for using the tax laws that have been enacted or substantially enacted as of the Balance Sheet date. Deferred Tax Assets are recognised only to the extent there is a reasonable certainty of realisation in future. However, where there is unabsorbed depreciation or carry forward of losses under taxation laws, Deferred Tax Assets are recognised only if there is virtual certainty of realisation of such assets. Such assets are reviewed at each balance sheet date for realisability.

10. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expense in the Statement of Profit and Loss in the period in which they are incurred.

The difference between the issue price and the redemption value of Commercial Paper is apportioned on time basis and recognised as discounting expense.

Expenses incurred in connection with the issue of Non Convertible Debentures and Commercial Paper are charged to Statement of Profit and Loss in the year of issue.

11. Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized for a present obligation as a result of past event; when it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. Provisions are determined based on best management estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. Contingent liabilities are not recognized but are disclosed in notes.

Contingent asset is a possible asset that arises from past events the existence of which will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the Company. Contingent assets are neither recognized nor disclosed in the Financial Statements.

12. Leases As Lessor

A finance lease is a lease that transfers substantially all the risks and rewards incident to ownership of an asset. Amounts due from lessees under finance leases are recorded as receivables at the amount of the Company's net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Company's net investment outstanding in respect of the leases.

As Lessee

Lease of assets under which significant risk and rewards of ownership are effectively retained by lessor are classified as operating lease. Lease payments under an operating lease are recognized as expense in the Statement of Profit and Loss on a straight line basis over the lease term.

13. Use of Estimates

The preparation of Financial Statements requires management to make judgments, estimates and assumptions, that affect the application of accounting policies and the reported amounts of assets, liabilities, income, expenses and disclosures of contingent liabilities at the date of these financial statements for the years presented. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed at each balance sheet date. Revisions to accounting estimates are recognised in the period in which the estimate is revised and future periods affected.

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Mar 31, 2014

1. Accounting Convention

"The Financial Statements are prepared under the historical cost convention, in accordance with the requirements of the Companies Act, 1956 (the Act) and applicable Accounting Standards as specified under section 211(3C) of the Act, read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013, as adopted consistently by the Company. All Income & Expenditure having a material bearing on the Financial Statement is accounted for on accrual basis and provision is made for all known losses and liabilities."

2. Fixed Assets and Depreciation

1) Fixed Assets are stated at cost less accumulated depreciation / amortization and impairment loss. Cost of Fixed Assets comprises purchase price, non refundable duties & levies and any directly attributable costs of bringing an asset to its working condition and location for its intended use. Depreciation on Fixed Assets is provided on the straight-line method based on estimated useful lives, as estimated by the management. Leasehold land is amortised over the period of lease. Assets costing less than Rs. 5,000 are depreciated fully in the year of purchase.

2) Advance paid towards acquisition of Fixed Assets are disclosed under Long Term Loans and Advances, and cost of the assets not ready for intended use before the year end, are disclosed under Capital Work in Progress.

3) The management''s estimate of the useful lives of fixed assets is as follows:

Assets Useful lives (in years)

Goodwill 5 Buildings 30 Airconditioners 10 Plant and Machinery 10 Office Equipments 10 Computers and Softwares 5 Electrical Installations 10 Vehicles 6 Furniture & Fixtures 10 Machines capitalized and machines under Facilities Management Contracts 3

3. Impairment of Asset :

The carrying amounts of assets in use are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Recoverable amount of an asset or a cash generating unit is higher of its net selling price and value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. Impairment losses are recognized in the Statement of Profit and Loss. 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 asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

4. Inventories :

Inventories are valued at lower of cost and net realisable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Raw materials and Components First in first out basis.

Finished Goods

Trading Yearly Weighted Average Basis

5. Investments

Investments are classified into current and long term investments. Investments that are readily realisable and are 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 investment". Current investments are stated at the lower of cost and fair value. Long term investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

6. Revenue Recognition

1) Sale of Goods:“Revenue from sale of goods is recognised when all significant risks and rewards of ownership are transferred to the customer, usually on the delivery of goods, and are net of trade discounts, sales tax and excise duty

2) Rendering of Services:“Income from services is included in turnover when the contractual commitment to the customer has been fulfilled and are net of trade discounts, service tax and works contract tax. "

3) Interest Income:“Interest Income is recognised on time proportion basis taking into account the amount outstanding and the rate applicable."

4) Dividend Income:“Dividend income on investments is recognised when the right to receive payment is established.

7. Employee Benefits

1) Short term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related services are rendered.

2) Retirement benefits in the form of Superannuation / Pension is a defined contribution scheme and the contribution towards defined contribution scheme is charged to the Statement of Profit and Loss of the year when the contribution to the Fund is due. There is no obligation other than the contribution payable to the Fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through the Company''s own Provident Fund Trust.

4) Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognised in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are immediately taken to Statement of Profit and Loss and are not deferred.

7) Termination benefits are recognized as an expense immediately.

8. Foreign Currency Transactions

Foreign Exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Monetary assets and liabilities which are realisable and payable in foreign currency are translated at year-end rates. Non-monetary items denominated in foreign currencies are valued at the exchange rate prevailing at the date of transaction. Any resultant gain/loss on account of exchange difference either on settlement or on translation is recognized in the Statement of Profit and Loss.

In case of Forward Contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the Statement of Profit and Loss in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

9. Warranty

The provision for warranty cost is made based on the technical estimates made by the management for the expenditure to be incurred.

10. Income Taxes

1) Current tax is the tax payable for the period determined in accordance with the provisions of the Income Tax Act , 1961. In case of matters under appeal due to disallowance or otherwise, provision is made when the said liabilities are accepted by the Company.

2) In accordance with the AS 22- "Accounting for Taxes on Income”, the deferred tax for the timing difference between taxable income and accounting income, that originate in one period and is capable of reversal in one or more subsequent periods, is accounted for using the tax laws that have been enacted or substantially enacted as of the Balance Sheet date. Deferred Tax Assets are recognised only to the extent there is a reasonable certainty of realisation in future. However, where there is unabsorbed depreciation or carry forward of losses under taxation laws, Deferred Tax Assets are recognised only if there is virtual certainty of realisation of such assets. Such assets are reviewed at each balance sheet date for realisability.

11. Borrowing Cost

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expense in the Statement of Profit and Loss in the period in which they are incurred.

12. 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.

13. Leases As Lessor

A finance lease is a lease that transfers substantially all the risks and rewards incident to ownership of an asset. Amounts due from lessees under finance leases are recorded as receivables at the amount of the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Company''s net investment outstanding in respect of the leases.

As Lessee

Lease of assets under which significant risk and rewards of ownership are effectively retained by lessor are classified as operating lease. Lease payments under an operating lease are recognized as expense in the Statement of Profit and Loss on a straight line basis over the lease term.

14. Use of Estimates

"The preparation of financial statements requires management to make judgments, estimates and assumptions, that affect the application of accounting policies and the reported amounts of assets, liabilities, income, expenses and disclosures of contingent liabilities at the date of these financial statements and Profit and Loss statement for the years presented. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed at each Balance Sheet date. Revisions to accounting estimates are recognised in the period in which the estimate is revised and future periods affected."

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Mar 31, 2013

1.1. Accounting Convention

"The Financial Statements are prepared under the historical cost convention, in accordance with applicable Accounting Standards as specified under section 211(3C) of the Companies Act,1956, as adopted consistently by the Company. All Income & Expenditure having a material bearing on the Financial Statement is accounted for on accrual basis and provision is made for all known losses and liabilities."

1.2. Fixed Assets and Depreciation

All Fixed Assets are stated at cost of acquisition or revaluation less depreciation and impairment loss. Depreciation on Fixed Assets is provided on the straight-line method based on estimated useful lives, as estimated by the management. Leasehold land is amortised over the period of lease. Assets costing less than Rs. 5000 are depreciated fully in the year of purchase. The management''s estimate of the useful lives of fixed assets is as follows:

1.3. Impairment of Asset:

the carrying amounts of assets in use are reviewed at each balance sheet date to determine whether there is any indication of impairment If any such indication exists, the asset''s recoverable amount is estimated. For assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the Statement of Profit and Loss. 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 asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

1.4. Inventories:

Inventories are valued at lower of cost and net realisable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Raw materials and Components First in first out basis.

Work-in-Process Raw materials and component cost and appropriate share of labour and other overheads. Finished Goods

Trading Yearly Weighted Average Basis

Manufactured Raw materials and component cost and appropriate share of labour and other overheads.

1.5. Investments

Long term investments are carried at cost and provision is made to recognise any decline, other than temporary, in the carrying value of the investments. Current investments are stated at lower of cost and net realisable value.

1.6. Revenue Recognition

1. Revenue from sale of goods is recognised when significant risk and reward of ownership are transferred to the customer, which is at the point of dispatch of goods to the customer.

2. Income from services is included in turnover when the contractual commitment to the customer has been fulfilled.

3. Interest Income is booked on time proportion basis taking into account the amounts invested and rate of interest.

4. Dividend income on investments is accounted for when the right to receive the payment is established.

1.7. Employee Benefits

1) Short term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Profit and Loss of the year in which the related services are rendered.

2) Retirement benefits in the form of Superannuation/Pension is a defined contribution scheme and the contribution is charged to the Statement of Profit and Loss of the year when the contribution to the fund is due. There is no obligation other than the contribution payable to the fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through Company''s own Provident Fund Trust.

4) Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognised in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are immediately taken to Statement of Profit and Loss and are not deferred

1.8. Foreign Currency Transactions

Foreign Exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Realised gains and losses on foreign exchange transactions during the year, are recognized in the Statement of Profit and Loss. Monetary assets and liabilities which are realisable and payable in foreign currency are translated at year-end rates and resultant gains/losses on foreign exchange translation, are recognized in the Statement of Profit and Loss

In case of Forward Contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the Statement of Profit and Loss in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

1.9. Warranty

The provision for warranty cost is made based on the technical estimates made by the management for the expenditure to be incurred.

1.10. Income Taxes

Income taxes are accrued in the same period in which the related revenue and expenses arise. The differences that result between the taxable profit and the profit as per the financial statements are identified and thereafter deferred tax assets or deferred tax liabilities are recorded as timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted regulations. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only to the extent there is virtual certainty of realisation of such assets. In other situations, deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each balance sheet date for realisability.

1.11. Borrowing Cost

Borrowing cost that is directly attributable to acquisition, production or construction of qualifying asset is added to the cost of that asset. Other borrowing cost is recognised as an expense in Statement of Profit and Loss.

1.12. 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.

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Mar 31, 2012

1.1. Accounting Convention

"The Financial Statements are prepared under the historical cost convention, in accordance with applicable Accounting Standards as specified under section 211(3C) of the Companies Act,1956, as adopted consistently by the Company. All Income & Expenditure having a material bearing on the Financial Statement is accounted for on accrual basis and provision is made for all known losses and liabilities."

1.2. Fixed Assets and Depreciation

All Fixed Assets are stated at cost of acquisition or revaluation less depreciation and impairment loss. Depreciation on Fixed Assets is provided on the straight-line method based on estimated useful lives, as estimated by the management. Leasehold land is amortized over the period of lease. Assets costing less than Rs. 5000 are depreciated fully in the year of purchase. The management's estimate of the useful lives of fixed assets is as follows:

1.3. Impairment of Asset :

The carrying amounts of assets in use are reviewed at each balance sheet date to determine whether there is any indication of impairment If any such indication exists, the asset's recoverable amount is estimated. For assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the Statement of Profit and Loss. 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 asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

1.4. Inventories :

Inventories are valued at lower of cost and net realizable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Raw materials and Components First in first out basis.

Work-in-Process Raw materials and component cost and appropriate share of labour and other overheads.

Finished Goods

Trading Yearly Weighted Average Basis

Manufactured Raw materials and component cost and appropriate share of lab our and other overheads.

1.5. Investments

Long term investments are carried at cost and provision is made to recognize any decline, other than temporary, in the carrying value of the investments. Current investments are stated at lower of cost and net realizable value.

1.6. Revenue Recognition

1. Revenue from sale of goods is recognized when significant risk and reward of ownership are transferred to the customer, which is at the point of dispatch of goods to the customer.

2. Income from services is included in turnover when the contractual commitment to the customer has been fulfilled.

3. Interest Income is booked on time proportion basis taking into account the amounts invested and rate of interest.

4. Dividend income on investments is accounted for when the right to receive the payment is established.

1.7. Employee Benefits

1) 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 the related services are rendered.

2) Retirement benefits in the form of Superannuation/Pension is a defined contribution scheme and the contribution is charged to the Statement of Profit and Loss of the year when the contribution to the fund is due. There is no obligation other than the contribution payable to the fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through Company's own Provident Fund Trust.

4) Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognized in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are immediately taken to Statement of Profit and Loss and are not deferred

1.8. Foreign Currency Transactions

Foreign Exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Realized gains and losses on foreign exchange transactions during the year, are recognized in the Statement of Profit and Loss. Monetary assets and liabilities which are realizable and payable in foreign currency are translated at year-end rates and resultant gains/losses on foreign exchange translation, are recognized in the Statement of Profit and Loss

In case of Forward Contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the Statement of Profit and Loss in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

1.9. Warranty

The provision for warranty cost is made based on the technical estimates made by the management for the expenditure to be incurred.

1.10. Income Taxes

Income taxes are accrued in the same period in which the related revenue and expenses arise. The differences that result between the taxable profit and the profit as per the financial statements are identified and thereafter deferred tax assets or deferred tax liabilities are recorded as timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted regulations. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognized only to the extent there is virtual certainty of realization of such assets. In other situations, deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. Such assets are reviewed at each balance sheet date for reliability.

1.11. Borrowing Cost

Borrowing cost that is directly attributable to acquisition, production or construction of qualifying asset is added to the cost of that asset. Other borrowing cost is recognized as an expense in Statement of Profit and Loss.

1.12. 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.

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Mar 31, 2011

A. Accounting Convention

The Financial statements are prepared under the historical cost convention, in accordance with applicable Accounting Standards as specified under section 211(3C) of the Companies Act,1956, as adopted consistently by the Company. All income & expenditure having a material bearing on the financial statement is accounted for on accrual basis and provision is made for all known losses and liabilities.

b. Fixed assets and depreciation

All fixed assets are stated at cost of acquisition or revaluation less depreciation and impairment loss. Depreciation on fixed assets is provided on the straight-line method based on estimated useful lives, as estimated by the management. Leasehold land is amortised over the period of lease. Assets costing less than Rs. 5000 are depreciated fully in the year of purchase.

c. Impairment of Asset :

The carrying amounts of assets in use are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated. For assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the profit and loss account. 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 asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

d. Inventories :

Inventories are valued at lower of cost and net realisable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Raw materials and components First in first out basis.

Work-in-process Raw materials and component cost and appropriate share of labour and other overheads.

Finished goods

Trading Yearly Weighted Average Basis

Manufactured Raw materials and component cost and appropriate share of labour and other overheads.

e. Investments

Long term investments are carried at cost and provision is made to recognise any decline, other than temporary, in the carrying value of the investments. Current investments are stated at lower of cost and net realisable value.

f. Revenue recognition

1. Revenue from sale of goods is recognised when significant risk and reward of ownership are transferred to the customer, which is at the point of dispatch of goods to the customer.

2. Income from services is included in turnover when the contractual commitment to the customer has been fulfilled.

3. Interest on Investments is booked on time proportion basis taking into account the amounts invested and rate of interest.

4. Dividend income on investments is accounted for when the right to receive the payment is established.

g. Employee benefits

1) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss account of the year in which the related services are rendered.

2) Retirement benefits in the form of Superannuation/Pension is a defined contribution scheme and the contribution is charged to the Profit and Loss Account of the year when the contribution to the fund is due. There is no obligation other than the contribution payable to the fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through Company's own Provident Fund Trust.

4) Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognised in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are immediately taken to Profit and Loss Account and are not defined.

h. Foreign Currency Transactions

Foreign Exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Realised gains and losses on foreign exchange transactions during the year, are recognized in the profit and loss account. Monetary assets and liabilities which are realisable and payable in foreign currency are translated at year-end rates and resultant gains/losses on foreign exchange translation, are recognized in the profit and loss account.

In case of forward contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the profit and loss account in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

i. Warranty

The provision for warranty cost is made based on the technical estimates made by the management for the expenditure to be incurred.

j. Income Taxes

Income taxes are accrued in the same period in which the related revenue and expenses arise. The differences that result between the taxable profit and the profit as per the financial statements are identified and thereafter deferred tax assets or deferred tax liabilities are recorded as timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted regulations. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only to the extent there is virtual certainty of realisation of such assets. In other situations, deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each balance sheet date for realisability.

k. Borrowing Cost

Borrowing cost that is directly attributable to acquisition, production or construction of qualifying asset is added to the cost of that asset. Other borrowing cost is recognised as an expense in profit and loss account.

l. 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.

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Mar 31, 2010

A. Accounting Convention

The Financial statements are prepared under the historical cost convention, in accordance with applicable Accounting Standards as specified under section 211(3C) of the Companies Act,1956, as adopted consistently by the Company. All income & expenditure having a material bearing on the financial statement is accounted for on accrual basis and provision is made for all known losses and liabilities.

b. Fixed assets and depreciation

All fixed assets are stated at cost of acquisition or revaluation less depreciation and impairment loss. Depreciation on fixed assets is provided on the straight-line method based on estimated useful lives, as estimated by the management. Leasehold land is amortised over the period of lease. Assets costing less than Rs. 5000 are depreciated fully in the year of purchase. The managements estimate of the useful lives of fixed assets is as follows:

Assets Useful lives (in years)

Goodwill 5

Buildings 30

Airconditioners 10

Plant and machinery 10

Office equipments 10

Computers and software 5

Electrical Installations 10

Vehicles 6

Furniture & fixtures 10

Machines capitalized and machines under Facilities management contracts 3

c. Impairment of Asset :

The carrying amounts of assets in use are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated. For assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the profit and loss account. 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 assets carrying amount does not exceed the carrying amount that would have been determined net of depreciation, if no impairment loss has been recognized.

d. Inventories :

Inventories are valued at lower of cost and net realisable value. The basis of determining cost for different categories of inventory are as follows :

Spare Parts & Consumables Yearly Weighted Average Basis.

Raw materials and components First in first out basis.

Work-in-process Raw materials and component cost and appropriate share of labour and other overheads.

Finished goods

Trading Yearly Weighted Average Basis

Manufactured Raw materials and component cost and appropriate share of labour and other overheads.

e. Investments

Long term investments are carried at cost and provision is made to recognise any decline, other than temporary, in the carrying value of the investments.Current investments are stated at lower of cost and net realisable value.

f. Revenue recognition

1. Revenue from sale of goods is recognised when significant risk and reward of ownership are transferred to the customer, which is at the point of dispatch of goods to the customer.

2. Income from services is included in turnover when the contractual commitment to the customer has been fulfilled.

3. Interest on Investments is booked on time proportion basis taking into account the amounts invested and rate of interest.

4. Dividend income on investments is accounted for when the right to receive the payment is established.

g. Employee benefits

1) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss account of the year in which the related services are rendered.

2) Retirement benefits in the form of Superannuation/Pension is a defined contribution scheme and the contribution is charged to the Profit and Loss Account of the year when the contribution to the fund is due. There is no obligation other than the contribution payable to the fund.

3) Retirement benefit in the form of Provident Fund is a defined benefit plan administered through Companys own Provident Fund Trust.

4) Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

Gratuity benefit obligation recognised in the Balance Sheet represents the present value of the obligation as reduced by the fair value of plan assets.

5) Leave Encashment is provided for, on the basis of an actuarial valuation on Projected Unit Credit Method made at the end of each financial year.

6) Actuarial gains/losses are immediately taken to Profit and Loss Account and are not defined.

h. Foreign Currency Transactions

Foreign Exchange transactions are recorded at the exchange rates prevailing at the date of transaction. Realised gains and losses on foreign exchange transactions during the year, are recognized in the profit and loss account. Monetary assets and liabilities which are realisable and payable in foreign currency are translated at year-end rates and resultant gains/losses on foreign exchange translation, are recognized in the profit and loss account.

In case of forward contracts:

a) The premium or discount on all such contracts arising at the inception of each contract is amortized as income or expense over the life of the contract.

b) The exchange difference is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognized in the profit and loss account in the reporting period in which the exchange rates change.

c) Any profit or loss arising on the cancellation or renewal of forward contracts is recognized as income or as expense for the period.

i. Warranty

The provision for warranty cost is made based on the technical estimates made by the management for the expenditure to be incurred.

j. Income Taxes

Income taxes are accrued in the same period in which the related revenue and expenses arise. The differences that result between the taxable profit and the profit as per the financial statements are identified and thereafter deferred tax assets or deferred tax liabilities are recorded as timing differences, namely the differences that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted regulations. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only to the extent there is virtual certainty of realisation of such assets. In other situations, deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed at each balance sheet date for realisability.

k. Borrowing Cost

Borrowing cost that is directly attributable to acquisition, production or construction of qualifying asset is added to the cost of that asset. Other borrowing cost is recognised as an expense in profit and loss account.

l. 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.