Mar 31, 2015
A) Basis of preparation of financial statements
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 (Act) read with Rule 7 of the Companies (Accounts) Rules,
2014, the provisions of the Act Accounting policies have been
consistently applied except where a revision to an existing accounting
standard a change in the accounting policy hitherto in use.
b) Use of estimates
The preparation of financial statements is in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions to be made that affect the reported amounts of assets
and liabilities on the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Difference between actual results and estimates are recognized in the
period in which the results are known / materialized.
c) Revenue recognition
Revenue is recognized only when it can be reliably measured and it is
reasonable to expect ultimate collection on transfer of the significant
risk and reward of ownership of the goods to the buyer and stated at
net of discount, rebates, returns and VAT. Revenue from operation is
generally recognized when service is performed/rendered.
d) Tangible and intangible assets
Tangible and intangible assets are stated at acquisition cost, net of
accumulated depreciation and accumulated impairment losses, if any.
Cost includes purchase price, taxes and duties, labour cost and
directly attributable costs for self constructed assets and other
direct costs incurred up to the date the asset is ready for its
intended use.
e) Depreciation / amortization
Depreciation on tangible assets is provided on the Written Down Value
method over the useful lives of assets as prescribed in Schedule II to
Companies Act, 2013. Depreciation for assets purchased/sold during a
year 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.
f) Impairment of assets
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.
g) Foreign currency transaction
Foreign currency transactions are initially accounted at the exchange
rates prevailing on the date of the transactions. Gains and losses
arising on account of differences in foreign exchange rates on
settlement / translation of monetary items are recognized in the
Statement of Profit and Loss.
h) Borrowing cost
Borrowing cost that are attributable to the acquisition or construction
of qualifying assets are capitalized as part of the costs of such
assets. A qualifying asset is one that necessarily takes substantial
period of time to get ready for intended use. All other interest and
borrowing cost are charged to revenue.
i) Inventories
Cost of inventories comprises all cost of purchase, cost of conversion
and other costs incurred in bringing the inventories to their present
location and condition. Cost formulae used are "Weighted Average
Method". Cost of Work in Progress and Finished Goods is determined on
absorption costing method. Inventories are valued as follows:
i) Raw Materials, Stores & Spares, : At Cost or net realizable value
whichever is lower
Packing Materials, Consumables
ii) Finished Goods : At cost or net realizable value whichever is
lower.
iii) Traded goods : At cost or net realizable value whichever is lower
iv) Stock in Process : At cost including related overheads or net
realizable value whichever is lower
j) Retirement Benefits
i) Short-term employees contributions like Provident Fund, Employees
State Insurance Scheme are charged off at the undiscounted amount in
the year in which the related services are rendered.
ii) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to Profit and Loss account. Accordingly, Group Gratuity Scheme from
Life Insurance Corporation under which gratuity liability of Rs 15.87
Lacs (Previous Year Rs 13.77 Lacs) remain outstanding which is computed
based on Projected Unit Credit Method and company has made provision of
gratuity Rs 2.10 Lacs (Previous Year Rs 1.69 Lacs)
k) Taxation
Provision for current tax has been made on the basis of taxable income
for the current year and in accordance with the provisions of Income
Tax Act 1961. The deferred tax resulting from timing difference between
the accounting and taxable profit for the year 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 arising on account of
timing difference are recognized and carried forward to the extent
there is virtual certainty that these would be realized in future.
l) Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements.
m) Eating's Per Share
Basic eating's per share are 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 net
profit after tax by the weighted average number of equity share and
also weighted average number of equity shares that could have been
issued upon conversion of all dilutive equity share.
n) Investments
Investments are classified either long term based on Management's
intention at the time of purchase. Long Term Investment are stated at
cost. Provision for diminution in the value of long-term investment is
not made only if such a decline in temporary.
Mar 31, 2014
A) Basis of preparation of financial statements
The financial statements are prepared under historical cost convention
on an accrual basis of accounting and in accordance with generally
accepted accounting principles , Accounting Standards notified under
section 211(3C) of the Act read with the Companies Act 1956, and
relevant provision thereof.
All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI to the Act. Based on the nature of
products and the time between the acquisition of assets for processing
and their realisation in cash and cash equivalents, the Company has
ascertained its operating cycle as 12 months for the purpose of current
or non-current classification of assets and liabilities.
b) Use of estimates
The preparation of financial statements is in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Difference between actual
results and estimates are recognised in the period in which the results
are known / materialized.
c) Revenue recognition
Revenue is recognized only when it can be reliably measured and it is
reasonable to expect ultimate collection on transfer of the significant
risk and reward of ownership of the goods to the buyer and stated at
net of discount, rebates, returns and VAT.
d) Tangible and intangible assets
Tangible and intangible assets are stated at acquisition cost, net of
accumulated depreciation and accumulated impairment losses, if any.
Cost includes purchase price, taxes and duties, labour cost and
directly attributable costs for self constructed assets and other
direct costs incurred up to the date the asset is ready for its
intended use.
e) Depreciation / amortization
i. Depreciation on fixed assets are provided on WDV Method at the rates
and in manner as prescribed under Schedule XIV to the Companies Act,
1956.
ii. Depreciation on fixed assets added/disposed off during the year is
provided on pro-rata basis.
iii. Technology purchased has been amortized over the period of ten
years. Amortization is done on straight line basis.
f) Impairment of assets
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.
g) Foreign currency transaction
Foreign currency transactions are initially accounted at the exchange
rates prevailing on the date of the transactions. Gains and losses
arising on account of differences in foreign exchange rates on
settlement / translation of monetary items are recognised in the
Statement of Profit and Loss.
h) Borrowing cost
Borrowing cost that are attributable to the acquisition or construction
of qualifying assets are capitalized as part of the costs of such
assets. A qualifying asset is one that necessarily takes substantial
period of time to get ready for intended use. All other interest and
borrowing cost are charged to revenue.
i) Inventories
Cost of inventories comprises all cost of purchase, cost of conversion
and other costs incurred in bringing the inventories to their present
location and condition. The excise duty in respect of closing inventory
of finished goods is included as part of finished goods. Cost formulae
used are "Weighted Average Method". Cost of Work in Progress and
Finished Goods is determined on absorption costing method. Inventories
are valued as follows:
i) Raw Materials, Stores & Spares, : At Cost or net realisable value
Packing Materials, Consumables whichever is lower
ii) Finished Goods : At Cost or net realizable value
whichever is lower.
iii) Traded goods : At Cost or net realizable value
whichever is lower
iv) Stock in Process : At Cost including related
overheads or net realisable
value whichever is lower
j) Retirement Benefits
i) Short-term employees contributions like Provident Fund, Employees
State Insurance Scheme are charged off at the undiscounted amount in
the year in which the related services are rendered.
ii) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to Profit and Loss account.Accordingly,Group Gratuity Scheme from Life
Insurance Corporation under which gratuity liability of Rs.13.77 Lacs
(Previous Year Rs.12.09 Lacs) remain outstanding which is computed
based on Projected Unit Credit Method and company has made provision of
gratuity Rs.1.69 Lacs (Previous Year Rs.1.65 Lacs)
k) Taxation
Provision for current tax has been made on the basis of taxable income
for the current year and in accordance with the provisions of Income
Tax Act 1961. The deferred tax resulting from timing difference between
the accounting and taxable profit for the year 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 arising on account of
timing difference are recognized and carried forward to the extent
there is virtual certainty that these would be realized in future.
l) Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements.
m) Earnings per share
Basic earnings per share are computed by dividing the net profit after
tax by the weighted average number of equity shares outstanding during
the period. Diluted earning per share is computed by dividing the net
profit after tax by the weighted average number of equity share and
also weighted average number of equity shares that could have been
issued upon conversion of all dilutive equity share.
n) Investments
Investments are classified either long term based on Management''s
intentional the time of purchase. Long Term Investment are stated at
cost. Provision for dimunition in the value of long-term investment is
not made only if such a decline is temporary.
Mar 31, 2013
A. Basis of preparation of Financial Statements:
The financial statements are prepared under historical cost convention
on an accrual basis of accounting in accordance with generally accepted
accounting principles, accounting standards notified under section 211
(3c) of the Companies Act 1956, and the relevant provisions thereof.
B. Use of Estimates :
The preparation of financial statements is in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Difference between actual
results and estimates are recognised in the period in which the results
are known / materialized.
C. Fixed Assets:
Fixed assets are stated at cost (net of VAT of which credit is allowed)
less accumulated depreciation and impairment, if any. All Costs,
including financing costs and direct expenses incurred to bring the
assets in present location and condition till commencement of
commercial production attributable to the fixed assets are capitalized.
D. Intangible assets
Intangible asset are stated at cost of acquisition less accumulated
amortization and impairment, if any. Technology Purchased has been
amortized over the period of ten years. Amortization is done on
straight line basis. E Depreciation/Amortization:
(i) Depreciation on fixed assets are provided on W D V Method at the
rates and in the manner as prescribed in schedule XIV of the Companies
Act, 1956.
(ii) Depreciation on fixed assets added/disposed off during the year is
provided on pro-rata basis.
(Hi) Technology Purchased has been amortized over the period of ten
years. Amortization is done on straight line basis.
F. Impairment of Assets :
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.
G Foreign Currency Transaction :
1) Transactions denominated in foreign currency are normally recorded
at the exchange rates prevailing on the date of transaction.
2) Monetary assets and liabilities denominated in foreign currency are
translated into the relevant functional currency at exchange rates in
effect at the Balance Sheet date.
3) Non monetary foreign currency assets and liabilities measured at
historical cost are translated at exchange rate prevalent at date of
transaction.
4) Any income or expenses on account of exchange difference on
translation is recognized in the statement of profit and loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in that case they are adjusted to the carrying cost of
such assets.
H. Investments:
Investments are classified either long term or short term based on
Management''s intention at the time of purchase. Long Term Investments
are stated at cost. Provision for diminution in the value of long-term
investment is not made only if such a decline is temporary.
I. Inventories:
Inventory is measured at lower of cost or net realizable value after
providing for obsolescence, if any. Accordingly, the valuation criteria
for inventory valuation during the year are as follows:
(i) Raw Materials : At cost or net realizable value whichever is lower
(ii) Finished Goods : At cost or net realizable value whichever is
lower
(iii) Stock in Process : At cost including related overheads or net
realizable value whichever is lower.
Costs comprise all cost of purchase, cost of conversion and other costs
incurred in bringing the inventories to their present location and
condition. Cost formula used is "weighted average". Cost of work in
progress and finished goods is determined on absorption costing method.
J. Revenue Recognition / Sales :
Revenue is recognized only when it can be reliably measured and it is
reasonable to expect ultimate collection on transfer of the significant
risk and reward of ownership of the goods to the buyer and stated at
net of discount, rebates, returns anr! VAT . K. Employee Benefits:
1) Short term employees'' benefits like Provident Fund, Employees State
Insurance Scheme are charged off at the undiscounted amount in the
statement of Profit and loss of that year in which the related services
are rendered.
2) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to statement of Profit and Loss. Accordingly, Group Gratuity Scheme
from Life Insurance Corporation under which Gratuity liability of T
12.09 lacs (Previous Year ? 10.64 Lacs) remains outstanding which is
computed based on Projected Unit Credit Method and company has made
provision of gratuity x"1.65 lacs (Previous Year T 1.85 Lacs) during
the year.
L. Borrowing Cost:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the costs
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
interest and borrowing cost are charged to revenue.
M. Taxation:
Provision for current tax has been made on book profit of the current
year and in accordance with the provisions of Income Tax Act, 1961 The
deferred tax resulting from timing difference between the accounting
and taxable profit for the year 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 arising on account of timing
difference are recognized and carried forward to the extent there is
virtual certainty that these would be realized in future.
N. Provisions. Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements. 0.
Earning Per Share :
Basic earning per share is computed by dividing the net profit after
tax by the weighted average number of equity shares outstanding during
the period. Diluted earning per share is computed by dividing the net
profit after tax by the weighted average number of equity shares and
also weighted average number of equity shares that could have been
issued upon conversion of all dilutive potential equity share.
Mar 31, 2012
A. Basis of preparation of Financial Statements:
The financial statements are prepared under historical cost convention
as going concern and are consistent with generally accepted accounting
principles and provisions of the Companies Act 1956, on an accrual
basis unless otherwise stated.
B. Use of Estimates :
The preparation of financial statements is in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Difference between actual
results and estimates are recognised in the period in which the results
are known / materialized.
C. Fixed Assets :
Fixed assets are stated at cost (net of VAT of which credit is allowed)
less accumulated depreciation and impairment, if any. All Costs,
including financing costs and direct expenses incurred to bring the
assets in present location and condition till commencement of
commercial production attributable to the fixed assets are capitalized.
Work in Progress comprises outstanding advances paid to acquire fixed
assets that are not ready for intended use at Balance Sheet date.
D. Intangible assets :
Intangible asset are stated at cost of acquisition less accumulated
amortization and impairment, if any. Technology Purchased has been
amortized over the period of ten years. Amortization is done on
straight line basis.
E Depreciation / Amortization :
(i) Depreciation on fixed assets are provided on W D V Method at the
rates and in the manner as prescribed in schedule XIV of the Companies
Act, 1956.
(ii) Depreciation on fixed assets added/disposed off during the year is
provided on pro-rata basis.
(iii) Technology Purchased has been amortized over the period of ten
years. Amortization is done on straight line basis.
F. Impairment of Assets :
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.
G Foreign Currency Transaction :
1) Transactions denominated in foreign currency are normally recorded
at the exchange rates prevailing on the date of transaction.
2) Monetary assets and liabilities denominated in foreign currency are
translated into the relevant functional currency at exchange rates in
effect at the Balance Sheet date.
3) Non monetary foreign currency assets and liabilities measured at
historical cost are translated at exchange rate prevalent at date of
transaction.
4) Any income or expenses on account of exchange difference on
translation is recognized in the statement of profit and loss except in
case of long term liabilities, where they relate to acquisition of
fixed assets, in that case they are adjusted to the carrying cost of
such assets.
H. Investments :
Investments are classified either long term or short term based on
Management's intention at the time of purchase. Long Term Investments
are stated at cost. Provision for diminution in the value of long-term
investment is not made only if such a decline is temporary.
I. Inventories :
Inventory is measured at lower of cost or net realizable value after
providing for obsolescence, if any. Accordingly, the valuation criteria
for inventory valuation during the year are as follows:
(i) Raw Materials : At cost or net realizable value whichever is lower
(ii) Finished Goods : At cost or net realizable value whichever is
lower
(iii) Stock in Process : At cost including related overheads or net
realizable value whichever is lower.
(iv) Stock in Trade : At cost or net realizable value whichever is
lower.
Costs comprise all cost of purchase, cost of conversion and other costs
incurred in bringing the inventories to their present location and
condition. Cost formula used is "First-in-First-out". Cost of work
in progress and finished goods is determined on absorption costing
method.
J. Revenue Recognition / Sales :
Revenue is recognized only when it can be reliably measured and it is
reasonable to expect ultimate collection on transfer of the significant
risk and reward of ownership of the goods to the buyer and stated at
net of discount, rebates, returns and VAT .
K. Employee Benefits :
1) Short term employees' contributions like Provident Fund, Employees
State Insurance Scheme are charged off at the undiscounted amount in
the Profit and loss account of that year in which the related services
are rendered.
2) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to statement of Profit and Loss. Accordingly, Group Gratuity Scheme
from Life Insurance Corporation under which Gratuity liability of Rs.
10.64 lacs (Previous Year Rs. 10.44 Lacs) remains outstanding which is
computed based on Projected Unit Credit Method and company made
provision of Rs. 1.85 lacs (Previous Year Rs. 1.65 Lacs) during the year.
L. Borrowing Cost :
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the costs
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
interest and borrowing cost are charged to revenue.
M. Taxation :
Provision for current tax has been made on the basis of taxable income
for the current year and in accordance with the provisions of Income
Tax Act 1961. The deferred tax resulting from timing difference between
the accounting and taxable profit for the year 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 arising on account of
timing difference are recognized and carried forward to the extent
there is virtual certainty that these would be realized in future.
N. Provisions, Contingent Liabilities and Contingent Assets :
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements.
O. Earning Per Share :
Basic earning per share is computed by dividing the net profit after
tax by the weighted average number of equity shares outstanding during
the period. Diluted earning per share is computed by dividing the net
profit after tax by the weighted average number of equity shares and
also weighted average number of equity shares that could have been
issued upon conversion of all dilutive potential equity share.
Mar 31, 2011
A. Basis of preparation of Financial Statements:
The financial statements are prepared under historical cost convention
as going concern and are consistent with generally accepted accounting
principles and provisions of the Companies Act 1956, on an accrual
basis unless otherwise stated.
B. Use of Estimates:
The preparation of financial statements is in conformity with generally
accepted accounting principles requires estimates and assumptions to be
made that affect the reported amounts of assets and liabilities on the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Difference between actual
results and estimates are recognised in the period in which the results
are known / materialized.
C. Fixed Assets:
Fixed assets are stated at cost (net of VAT of which credit is allowed)
less accumulated depreciation and impairment, if any. All Costs,
including financing costs and direct expenses incurred to bring the
assets in present location and condition till commencement of
commercial production attributable to the fixed assets are capitalized.
Work in Progress comprises outstanding advances paid to acquire fixed
assets that are not ready for intended use at Balance Sheet date.
D. Intangible assets
Intangible asset are stated at cost of acquisition less accumulated
amortization and impairment, if any. Technical know-how has been
amortized over the period of ten years. Amortization is done on
straight line basis.
E. Depreciation / Amortization:
(i) Depreciation on fixed assets are provided on W D V Method at the
rates and in the manner as prescribed in schedule XIV of the Companies
Act, 1956.
(ii) Depreciation on fixed assets added/disposed off during the year is
provided on pro-rata basis.
(iii) Technical know-how has been amortized over the period of ten
years. Amortization is done on straight line basis.
F. Impairment of Assets :
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.
G. Foreign Currency Transaction:
1) Transactions denominated in foreign currency are normally recorded
at the exchange rates prevailing on the date of transaction.
2) Monetary assets and liabilities denominated in foreign currency are
translated into the relevant functional currency at exchange rates in
effect at the Balance Sheet date.
3) Non monetary foreign currency assets and liabilities measured at
historical cost are translated at exchange rate prevalent at date of
transaction.
4) Any income or expenses on account of exchange difference on
translation is recognized in the profit and loss account except in case
of long term liabilities, where they relate to acquisition of fixed
assets, in that case they are adjusted to the carrying cost of such
assets.
H. Investments:
Investments are classified either long term or short term based on
Management's intention at the time of purchase. Long Term Investments
are stated at cost. Provision for diminution in the value of long-term
invest- ment is not made only if such a decline is temporary.
I. Inventories:
Inventory is measured at lower of cost or net realizable value after
providing for obsolescence, if any. Accordingly, the valuation criteria
for inventory valuation during the year are as follows:
(i) Raw Materials : At cost or net realizable value whichever is lower
(ii) Finished Goods : At cost or net realizable value whichever is
lower
(iii) Stock in Process : At cost including related overheads or net
realizable value whichever is lower.
Costs comprise all cost of purchase, cost of conversion and other costs
incurred in bringing the inventories to their present location and
condition. Cost formula used is "First-in-First-out". Cost of work
in progress and finished goods is determined on absorption costing
method.
J. Revenue Recognition / Sales:
Revenue is recognized only when it can be reliably measured and it is
reasonable to expect ultimate collection on transfer of the significant
risk and reward of ownership of the goods to the buyer and stated at
net of discount, rebates, returns and VAT.
K. Employees benefits:
1) Short term employees' contributions like Provident Fund, Employees
State Insurance Scheme are charged off at the undiscounted amount in
the Profit and loss account of that year in which the related services
are rendered.
2) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to Profit and Loss account. Accordingly, Group Gratuity Scheme from
Life Insurance Corporation under which Gratuity liability of Rs 10.44
Lacs remains outstanding which is computed based on Projected Unit
Credit Method and company made provision of Rs 1.65 Lacs during the
year.
L. Borrowing Cost:
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the costs
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
interest and borrowing cost are charged to revenue.
M. Provision for Tax:
Provision for current tax has not made under the provisions of the
Income Tax Act, 1961, considering loss for the current year. The
deferred tax resulting from timing difference between the accounting
and taxable profit for the year 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 arising on account of timing
difference are recognized and carried forward to the extent there is
virtual certainty that these would be realized in future.
N. Provisions. Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements.
O. Earnings 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 net
profit after tax by the weighted average number of equity shares and
also weighted average number of equity shares that could have been
issued upon conversion of all dilutive potential equity share.
1. In the opinion of the Board, the current assets have a value on
realization in the ordinary course of business at least equal to the
amount at which these are stated above and the provisions for known
liabilities is adequate and not in excess of the amount considered
reasonable and necessary.
2. Security of Loans
(i) Term loan from ICICI bank is secured by hypothecation of car.
(ii) Term loan from HDFC bank is secured by hypothecation of car.
(iii) Term loan from Bank of India is secured by hypothecation of Plant
and Machinery. It is further secured by First Charge over fixed assets
of the company and personal guarantee of Managing Director, Shri Atul
Kumar Sethi and Whole Time Director, Mrs Amita Sethi.
(iv) Cash Credit.
The cash credit facilities availed from Bank of India are secured by
hypothecation of the Company's current assets consisting of stock of
Finished Goods, Stock in Process, Raw Materials etc. and book debts
both present and future. Further secured by extension of First Charge
over fixed assets of the company and personal guarantee of Managing
Director Shri Atul Kumar Sethi and Whole Time Director, Mrs Amita
Sethi.
Mar 31, 2010
A. Basis of preparation of consolidated financial statements :
The consolidated financial statements has been prepared and presented
in accordance with the Indian Generally Accepted Accounting Principle
("GAAP") under the historical cost convention on the actual basis. GAAP
comprises accounting standards notified by the Central Government of
India, under section 211 (3C) of the Companies Act, 1956,other
pronouncements of institute of Chartered Accountants of India., the
provisions of Companies Act, 1956 and guidelines by Securities and
Exchange Board of India.
B. Use of Estimates :
The preparation of consolidated financial statements in conformity with
GAAP required management to make estimates and assumption that effect
the reported amounts of assets and liabilities and disclosure of
contingent liabilities on the date of the consolidated financial
statements and reported amounts of revenues and expenses for the year.
Actual results could differ from these estimates. Any revision to
accounting estimates is recognized prospectively in the current &
future periods.
C. Principle of consolidation :
(i) The financial statements of the parent company and its subsidiary
have been consolidated on a line-by-line basis by adding together the
book value of like items of assets, liabilities, income and expenses,
after eliminating intra-group balances, intra-group transactions and
the unrealized profit/loss on intra-group transactions, as per
Accounting Standard 21-Consolidated Financial Statements.
(ii) The financial statements of the parent company and its subsidiary
have been consolidated using uniform accounting policies for like
transactions and other event in similar circumstances.
(iii) The financial statements of the subsidiary used in the
consolidated are drawn up to the same reporting date as that of the
company i.e. 31st March.
(iv) The excess / deficit of cost to the patent company of its
investment in subsidiary company over its share of equity at the date
on which the investment in subsidiary was made, is recognized as
ÃGoodwill / Capital Reserveà in the consolidated financial statements.
(v) Minority interest in the net asset of consolidated subsidiary
consists of the amount of equity attributable to the minority
shareholders at the date on which investment is made by the parent
company in the subsidiary and further movements in their share in the
equity subsequent to the date of investment.
D. Fixed Assets :
Fixed assets are stated at cost (net of VAT of which credit is allowed)
less accumulated depreciation and impairment, if any. Cost includes all
expenses incurred to bring the asset to present location and condition.
All direct expenses are capitalized until fixed assets are ready to put
to use. Capital Work in Progress comprises outstanding advances paid to
acquire fixed assets that are not ready for intended use at Balance
Sheet date
E. Depreciation/Amortisation :
(i) Depreciation on fixed assets are provided on W D V Method at the
rates and in the manner as prescribed in schedule XIV of the Companies
Act, 1956.
(ii) Depreciation on fixed assets added/disposed off during the year is
provided on pro-rata basis from the month of addition or upto the month
of disposal, as applicable.
F. Intangible assets :
Intangible asset are stated at cost of acquisition less accumulated
amortization. Technical know-how has been amortized over the period of
ten years. Amortization is done on straight line basis.
G. Inventories :
Inventory is measured at lower of cost or net realizable value after
providing for obsolescence, if any. Accordingly, the valuation criteria
for inventory valuation during the year are as follows: (i) Raw
Materials : At cost or net realizable value whichever is lower
(ii) Finished Goods : At cost or net realizable value whichever is
lower
(iii) Stock in Process : At cost including related Overheads or net
realizable value whichever is lower. Costs comprise all cost of
purchase, cost of conversion and other costs incurred in bringing the
inventories to their present location and condition. Cost formula used
is "First-in-First-out". Cost of work in progress and finished goods is
determined on absorption costing method.
H. Borrowing Cost :
Borrowing Costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the costs
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use. All other
interest and borrowing cost are charged to revenue.
I. Revenue Recognition / Sales :
Sales revenue is recognized on transfer of the significant risk &
reward of ownership of the goods to the buyer and stated at net of
discount, rebate, returns and VAT.
J. Foreign Currency Transaction :
a) Transaction denominated in foreign currency are normally recorded at
the exchange rates prevailing on the date of transaction.
b) Foreign currency denominated monetary assets and liabilities are
translated into the relevant functional currency at exchange rates in
effect at the Balance Sheet date.
c) Non-monetary foreign currency assets and liabilities measured at
historical cost are translated at exchange rate prevalent at date of
transaction.
d) Any income or expenses on account of exchange difference on
translation is recognized in the profit and loss account.
K. Employees Benefits :
1) Short term employees contributions like Provident Fund, Employees
State Insurance Scheme are charged off at the undiscounted amount in
the year in which the related services are rendered.
2) Post employment and other long term employee benefits like gratuity
is provided on actuarial valuation at the end of the year and charged
to Profit and Loss account. Accordingly, Group Gratuity Scheme from
Life Insurance Corporation under which Gratuity liability of Rs 23.81
Lacs remains outstanding which is computed based on Projected Unit
Credit Method and company made provision of Rs 11.39 Lacs during the
year.
L. Taxation :
Provision for current tax has been made on the basis of estimated
taxable income for the current year and in accordance with the
provisions as per Income Tax Act 1961. The deferred tax resulting from
the timing difference between the accounting and taxable profit for the
year 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 arising on account of timing difference are recognized and
carried forward to the extent there is virtual certainty that these
would be realized in future.
M. Provisions, Contingent Liabilities and Contingent Assets :
Provisions involving substantial degree of estimation in measurement
that can be reliably ascertained, 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, when no reliable estimate is
made or when there is present or past obligation that may, but probably
will not, require an outflow of resources. Contingent Assets are
neither recognized nor disclosed in the financial statements.
N. Impairment of Assets :
An asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. Recoverable amount is higher of net
selling price or value in use. Management reviews the carrying cost of
the assets at the end of each balance sheet date and is of the view
that the recoverable value in the assets is more than the carrying
amount and hence no provision for impairment of assets has been made.