Mar 31, 2015
I) FIXED ASSETS AND DEPRECIATION:
a) Fixed Assets are stated at cost, net of Cenvat. All costs including
financing costs till commencement of commercial production and
adjustment arising from exchange rate variations relating to borrowings
attributable to the fixed assets are capitalised. Stores and spares
received along with the Plant & Machinery are being capitalised with
related machine.
b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without
availing CENVAT, and thermal power plant is stated without availing
service cenvat. All costs including financing costs till commencement
of commercial production and adjustment arising from exchange rate
variations relating to borrowings attributable to the fixed assets are
capitalized.
c) Depreciation on fixed assets is provided on straight line method as
per useful life prescribed in Schedule II to the Companies Act, 2013.
Depreciation on incremental cost, arising on account of conversion
difference of foreign currency liabilities for acquisition of fixed
assets and stand by equipments , which are amortised over the residual
life of the respective assets.
d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are
fully depreciated.
e) The company provides for depreciation on following plant & machinery
considering the same as continuous process plant.
(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn
Division
(ii) Power Generation Equipments
f) Free hold lands and leasehold lands are not depreciated.
g) Impairment of Assets - If the carrying amount of fixed assets
exceeds the recoverable amount on the reporting date, the carrying
amount is reduced to the recoverable amount. The recoverable amount is
measured as the highest of the net selling price and the value in use
determined by the present value of estimated future cash flows.
ii) INVENTORIES:
Inventories are valued at cost or net realisable value which ever is
lower. Historical cost has been determined as under:-
A Raw Materials At Batch cost.
B Stores, Spares At First In First Out method.
C Fuel Monthly weighted average
D Work-in-progress
(i) Preparatory Stage - at cost
(ii) Yarn Stage-at cost or net realizable value whichever is lower.
E Finished goods at cost or net realizable value whichever is lower.
[Cost formula used in clause (D) & (E): - Conversion cost and other
cost in bringing the inventories to their present location and
condition.]
F Waste and Scrap at net realisable value.
G Trading stocks at cost of purchase
iii) INVESTMENTS:
Long term investments are carried at cost including related expenses.
In case of diminution in value other than temporary, the carrying
amount is reduced to recognize the decline cost.
iv) RAW MATERIAL CONSUMPTION IS NET OF EXPORT BENEFITS.
v) RESEARCH AND DEVELOPMENT:
Research and development costs (other than costs of fixed assets
acquired) are charged as an expense in the year in which they are
incurred.
vi) EMPLOYEE BENEFITS:
Short-term employee benefits (benefits which are payable within twelve
months after the end of the period in which the employees render
service ) are measured at cost. Long -term employee benefits ( benefits
which are payable after the end of twelve months from the end of the
period in which the employees render service ) and post employment
benefits ( benefits which are payable after completion of employment )
are measured on a discounted basis by the Projected Unit Credit Method
on the basis of annual third party actuarial valuations.
Contributions to Provident Fund , a defined contribution plan are made
in accordance with the statute , and are recognized as an expense when
employees have rendered service entitling them to the contributions.
The costs of providing leave encashment and gratuity, defined benefit
plans, are determined using the Projected Unit Credit Method , on the
basis of actuarial valuations carried out by third party actuaries at
each balance sheet date. The leave encashment and gratuity benefit
obligation recognized in the Balance Sheet represents the present value
of the obligations as reduced by the fair value of plan assets. Any
asset resulting from this calculation is limited to the discounted
value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan. Actuarial
gains and losses are recognized immediately in the Profit and Loss
Account.
vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:
Preliminary, Capital issue expenses are amortised in a period of ten
years. Upfront payment made for reduction in rate of interest and for
fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue
Expenses) are amortised in a period of five years.
viii) REVENUE RECOGNITION:
(a) The accounts of the company are prepared under the historical cost
convention and in accordance with the applicable accounting standards.
(b) Income is accounted for on accrual basis in accordance with
Accounting Standard (AS) 9-"Revenue Recognition" which provides that
where there is no reasonable certainty, the recognition of income be
postponed.
(c) Excise Duty is recognized on dispatches to parties except
consignment agents.
(d) Claims lodged with insurance companies and others are recognised in
accounts to the extent they are measurable with reasonable certainty of
acceptance. Excess/Shortfall is adjusted in the year of receipt.
ix) CENVAT:
a. CENVAT claimed on capital goods (Plant and Machinery), except for
Plant and Machinery of Cotton Yarn Division and Service tax cenvat on
plant & machinery of Wartsila Power Division, is credited to Plant and
Machinery cost. Depreciation is not charged on the CENVAT claimed on
capital goods in the books of account as well as under the Income Tax
Act.
b. CENVAT on purchases of such inputs are deducted from the cost,
wherever the excise duty has been paid on finished goods manufactured
out of these inputs.
x) FOREIGN CURRENCY TRANSACTION:
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
b. Monetary items denominated in foreign currencies at the year end
are restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts is recognized over
the life of the contract.
c. Non monetary foreign currency items are carried at cost.
d. Any income or expense on account of exchange difference either on
settlement or on translation is recognized in the Profit and Loss
Account except incase of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
xi) EXPORT BENEFITS:
Export benefits on Export are recognized in accounts to the extent they
are measurable with reasonable certainty.
Excess/Shortfall is adjusted in the year of receipt.
xii) PROVISIONS AND CONTINGENT LIABILITIES: a. Provisions are made
when the present obligation of a past event gives rise to probable
outflow, embodying economic benefit on settlement and the amount of
obligation can be reliably estimated.
b. Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved.
c. Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates.
xiii) TAXATION:
Provision for current tax is made in accordance with the provisions of
the Income Tax Act, 1961. Deferred tax on account of timing difference
between taxable and accounting income is provided considering the tax
rates and tax laws enacted or substantially enacted by the Balance
Sheet date in accordance with Accounting Standard 22 as notified by the
regulatory authorities.
xiv) EXCISE DUTY:
Excise duty on manufactured goods wherever applicable is accounted for
at the point of manufacture of goods and accordingly, is considered for
valuation of finished goods stock lying in the factories as on the
Balance Sheet date.
Mar 31, 2014
I) FIXED ASSETS AND DEPRECIATION:
a) Fixed Assets are stated at cost, net of Cenvat. All costs including
financing costs till commencement of commercial production and
adjustment arising from exchange rate variations relating to borrowings
attributable to the fixed assets are capitalised. Stores and spares
received along with the Plant & Machinery are being capitalised with
related machine.
b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without
availing CENVAT, and thermal power plant is stated without availing
service cenvat. All costs including financing costs till commencement
of commercial production and adjustment arising from exchange rate
variations relating to borrowings attributable to the fixed assets are
capitalized.
c) Depreciation on fixed assets is provided on straight line method at
the rates and in the manner prescribed in Schedule XIV to the Companies
Act, 1956 as amended except depreciation on incremental cost, arising
on account of conversion difference of foreign currency liabilities for
acquisition of fixed assets and stand by equipments , which are
amortised over the residual life of the respective assets.
d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are
fully depreciated.
e) The company provides for depreciation on following plant & machinery
considering the same as continuous process plant.
(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn
Division
(ii) Power Generation Equipments
f) Free hold lands and leasehold lands are not depreciated.
g) Impairment of Assets : If the carrying amount of fixed assets
exceeds the recoverable amount on the reporting date, the carrying
amount is reduced to the recoverable amount. The recoverable amount is
measured as the highest of the net selling price and the value in use
determined by the present value of estimated future cash flows.
ii) INVENTORIES: Inventories are valued at cost or net realisable value
which ever is lower. Historical cost has been determined as under :-
A Raw Materials At Batch cost.
B Stores, Spares At moving weighted average cost.
C Fuel Monthly weighted average
D Work-in-progress
(i) Preparatory Stage  at cost
(ii) Yarn Stage-at cost or net realizable value whichever is lower.
E Finished goods at cost or net realizable value whichever is lower.
[Cost formula used in clause (D) & (E): Â Conversion cost and other
cost in bringing the inventories to their present location and
condition.]
F Waste and Scrap at net realisable value.
G Trading stocks at cost of purchase
iii) INVESTMENTS: Long term investments are carried at cost including
related expenses. In case of diminution in value other than temporary,
the carrying amount is reduced to recognize the decline cost.
iv) Raw Material consumption is net of Export benefits.
v) RESEARCH AND DEVELOPMENT: Research and development costs (other than
costs of fixed assets acquired) are charged as an expense in the year
in which they are incurred.
vi) EMPLOYEE BENEFITS:
Short-term employee benefits (benefits which are payable within twelve
months after the end of the period in which the employees render
service) are measured at cost. Long -term employee benefits (benefits
which are payable after the end of twelve months from the end of the
period in which the employees render service) and post employment
benefits (benefits which are payable after completion of employment)
are measured on a discounted basis by the Projected Unit Credit Method
on the basis of annual third party actuarial valuations.
Contributions to Provident Fund, a defined contribution plan are made
in accordance with the statute, and are recognized as an expense when
employees have rendered service entitling them to the contributions.
The costs of providing leave encashment and gratuity, defined benefit
plans, are determined using the Projected Unit Credit Method, on the
basis of actuarial valuations carried out by third party actuaries at
each balance sheet date. The leave encashment and gratuity benefit
obligation recognized in the Balance Sheet represents the present value
of the obligations as reduced by the fair value of plan assets. Any
asset resulting from this calculation is limited to the discounted
value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan. Actuarial
gains and losses are recognized immediately in the Profit and Loss
Account.
vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:
Preliminary, Capital issue expenses are amortised in a period of ten
years. Upfront payment made for reduction in rate of interest and for
fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue
Expenses) are amortised in a period of five years.
viii) REVENUE RECOGNITION:
(a) The accounts of the company are prepared under the historical cost
convention and in accordance with the applicable accounting standards.
(b) Income is accounted for on accrual basis in accordance with
Accounting Standard (AS) 9-"Revenue Recognition" which provides that
where there is no reasonable certainty, the recognition of income be
postponed.
(c) Excise Duty is recognized on dispatches to parties except
consignment agents.
(d) Claims lodged with insurance companies and others are recognised in
accounts to the extent they are measurable with reasonable certainty of
acceptance. Excess/Shortfall is adjusted in the year of receipt.
ix) CENVAT
a. CENVAT claimed on capital goods (Plant and Machinery), except for
Plant and Machinery of Cotton Yarn Division and Service tax cenvat on
plant & machinery of Wartsila Power Division, is credited to Plant and
Machinery cost. Depreciation is not charged on the CENVAT claimed on
capital goods in the books of account as well as under the Income Tax
Act.
b. CENVAT on purchases of such inputs are deducted from the cost,
wherever the excise duty has been paid on finished goods manufactured
out of these inputs.
x) FOREIGN CURRENCY TRANSACTION Â
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
b. Monetary items denominated in foreign currencies at the year end are
restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts is recognized over
the life of the contract.
c. Non monetary foreign currency items are carried at cost.
d. Any income or expense on account of exchange difference either on
settlement or on translation is recognized in the Profit and Loss
Account except incase of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
xi) EXPORT BENEFITS Â Export benefits on Export are recognized in
accounts to the extent they are measurable with reasonable certainty.
Excess/Shortfall is adjusted in the year of receipt.
xii) PROVISIONS AND CONTINGENT LIABILITIES Â
a. Provisions are made when the present obligation of a past event
gives rise to probable outflow, embodying economic benefit on
settlement and the amount of obligation can be reliably estimated.
b. Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved
c. Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates.
xiii) TAXATION :
Provision for current tax is made in accordance with the provisions of
the Income Tax Act, 1961. Deferred tax on account of timing difference
between taxable and accounting income is provided considering the tax
rates and tax laws enacted or substantially enacted by the Balance
Sheet date in accordance with Accounting Standard 22 as notified by the
regulatory authorities.
xiv) EXCISE DUTY :
Excise duty on manufactured goods wherever applicable is accounted for
at the point of manufacture of goods and accordingly, is considered for
valuation of finished goods stock lying in the factories as on the
Balance Sheet date.
Mar 31, 2013
I) FIXED ASSETS AND DEPRECIATION:
a) Fixed Assets are stated at cost, net of Cenvat. All costs including
financing costs till commencement of commercial production and
adjustment arising from exchange rate variations relating to borrowings
attributable to the fixed assets are capitalised. Stores and spares
received along with the Plant & Machinery are being capitalised with
related machine.
b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without
availing CENVAT, and thermal power plant is stated without availing
service cenvat. All costs including financing costs till commencement
of commercial production and adjustment arising from exchange rate
variations relating to borrowings attributable to the fixed assets are
capitalized.
c) Depreciation on fixed assets is provided on straight line method at
the rates and in the manner prescribed in Schedule XIV to the Companies
Act, 1956 as amended except depreciation on incremental cost, arising
on account of conversion difference of foreign currency liabilities for
acquisition of fixed assets and stand by equipments, which are
amortised over the residual life of the respective assets.
d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are
fully depreciated.
e) The company provides for depreciation on following plant & machinery
considering the same as continuous process plant.
(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn
Division.
(ii) Power Generation Equipments.
f) Free hold lands and leasehold lands are not depreciated.
g) Impairment of Assets  If the carrying amount of fixed assets
exceeds the recoverable amount on the reporting date, the carrying
amount is reduced to the recoverable amount. The recoverable amount is
measured as the highest of the net selling price and the value in use
determined by the present value of estimated future cash flows.
ii) INVENTORIES : Inventories are valued at cost or net realisable
value which ever is lower. Historical cost has been determined as under
:-
A Raw Materials At Batch cost.
B Stores, Spares At moving weighted average cost.
C Fuel Monthly weighted average
D Work-in-progress (i) Preparatory Stage  at cost
(ii) Yarn Stage-at cost or net
realizable value whichever is lower. E Finished goods at cost or net
realizable value whichever is lower. [Cost formula used in clause (D)
& (E): Â Conversion cost and other cost in bringing the inventories to
their present location and condition.]
F Waste and Scrap at net realisable value.
G Trading stocks at cost of purchase
iii) INVESTMENTS: Long term investments are carried at cost including
related expenses. In case of diminution in value other than temporary,
the carrying amount is reduced to recognize the decline cost.
iv) Raw Material consumption is net of Export benefits.
v) RESEARCH AND DEVELOPMENT : Research and development
costs (other than costs of fixed assets acquired) are charged as an
expense in the year in which they are incurred.
vi) EMPLOYEE BENEFITS:
Short-term employee benefits (benefits which are payable within twelve
months after the end of the period in which the employees render
service) are measured at cost. Long Âterm employee benefits ( benefits
which are payable after the end of twelve months from the end of the
period in which the employees render service) and post employment
benefits (benefits which are payable after completion of employment )
are measured on a discounted basis by the Projected Unit Credit Method
on the basis of annual third party actuarial valuations.
Contributions to Provident Fund , a defined contribution plan are made
in accordance with the statute , and are recognized as an expense when
employees have rendered service entitling them to the contributions.
The costs of providing leave encashment and gratuity, defined benefit
plans, are determined using the Projected Unit Credit Method , on the
basis of actuarial valuations carried out by third party actuaries at
each balance sheet date. The leave encashment and gratuity benefit
obligation recognized in the Balance Sheet represents the present value
of the obligations as reduced by the fair value of plan assets. Any
asset resulting from this calculation is limited to the discounted
value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan. Actuarial
gains and losses are recognized immediately in the Profit and Loss
Account.
vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:
Preliminary, Capital issue expenses are amortised in a period of ten
years. Upfront payment made for reduction in rate of interest and for
fresh Term Loans and amalgamation expenses (Debited to Deferred Revenue
Expenses) are amortized in a period of five years.
viii) REVENUE RECOGNITION:
(a) The accounts of the company are prepared under the historical cost
convention and in accordance with the applicable accounting standards.
(b) Income is accounted for on accrual basis in accordance with
Accounting Standard (AS) 9-"Revenue Recognition" which provides that
where there is no reasonable certainty, the recognition of income be
postponed.
(c) Excise Duty is recognized on dispatches to parties except
consignment agents.
(d) Claims lodged with insurance companies and others are recognized in
accounts on lodgment to the extent they are measurable with reasonable
certainty of acceptance. Excess/Shortfall is adjusted in the year of
receipt.
ix) CENVAT
a. CENVAT claimed on capital goods (Plant and Machinery), except for
Plant and Machinery of Cotton Yarn Division and Service tax cenvat on
plant & machinery of Wartsila Power Division, is credited to Plant and
Machinery cost. Depreciation is not charged on the CENVAT claimed on
capital goods in the books of account as well as under the Income Tax
Act.
b. CENVAT on purchases of such inputs are deducted from the cost,
wherever the excise duty has been paid on finished goods manufactured
out of these inputs.
x) FOREIGN CURRENCY TRANSACTION Â
a. Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing on the date of the transaction or that
approximates the actual rate at the date of the transaction.
b. Monetary items denominated in foreign currencies at the year end are
restated at year end rates. In case of items which are covered by
forward exchange contracts, the difference between the year end rate
and rate on the date of the contract is recognized as exchange
difference and the premium paid on forward contracts is recognized over
the life of the contract.
c. Non monetary foreign currency items are carried at cost.
d. Any income or expense on account of exchange difference either on
settlement or on translation is recognized in the Profit and Loss
Account except incase of long term liabilities, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets.
xi) EXPORT BENEFITS Â Export benefits including estimated duty
differentials accruing on account of entitlement for duty free raw
materials against indigenous/duty paid raw material consumed for
exports during the year are estimated and ascertained for at the year
end.
xii) PROVISIONS AND CONTINGENT LIABILITIES Â
a. Provisions are made when the present obligation of a past event
gives rise to probable outflow, embodying economic benefit on
settlement and the amount of obligation can be reliably estimated.
b. Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved
c. Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates.
xiii) TAXATION :
Provision for current tax is made in accordance with the provisions of
the Income Tax Act, 1961. Deferred tax on account of timing difference
between taxable and accounting income is provided considering the tax
rates and tax laws enacted or substantially enacted by the Balance
Sheet date in accordance with Accounting Standard 22 as notified by the
regulatory authorities.
xiv) EXCISE DUTY :
Excise duty on manufactured goods wherever applicable is accounted for
at the point of manufacture of goods and accordingly, is considered for
valuation of finished goods stock lying in the factories as on the
Balance Sheet date.
Mar 31, 2012
I) FIXED ASSETS AND DEPRECIATION:
a) Fixed Assets are stated at cost, net of Cenvat. All costs including
financing costs till commencement of commercial production and
adjustment arising from exchange rate variations relating to borrowings
attributable to the fixed assets are capitalised. Stores and spares
received along with the Plant & Machinery are being capitalised with
related machine.
b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without
availing CENVAT, and thermal power plant is stated without availing
service cenvat. All costs including financing costs till commencement
of commercial production and adjustment arising from exchange rate
variations relating to borrowings attributable to the fixed assets are
capitalised
c) Depreciation on fixed assets is provided on straight line method at
the rates and in the manner prescribed in Schedule XIV to the Companies
Act, 1956 as amended except depreciation on incremental cost, arising
on account of conversion difference of foreign currency liabilities for
acquisition of fixed assets and stand by equipments , which are
amortised over the residual life of the respective assets.
d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are
fully depreciated.
e) The company provides for depreciation on following plant & machinery
considering the same as continuous process plant.
(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn
Division
(ii) Power Generation Equipments
f) Free hold lands and leasehold lands are not depreciated.
g) Impairment of Assets - If the carrying amount of fixed assets
exceeds the recoverable amount on the reporting date, the carrying
amount is reduced to the recoverable amount. The recoverable amount is
measured as the highest of the net selling price and the value in use
determined by the present value of estimated future cash flows.
ii) INVENTORIES: Inventories are valued at cost or net realisable value
which ever is lower. Historical cost has been determined as under
A Raw Materials At Batch cost.
B Stores, Spares At moving weighted average cost.
C Fuel Monthly weighted average
D Work-in-progress (i) Preparatory Stage-at cost
(ii) Yarn Stage-at cost
E Finished goods at cost
[Cost formula used in clause (D) & (E): - Conversion cost and other
cost in bringing the inventories to their present location and
condition.]
F Waste and Scrap at net realisable value.
G Trading stocks at cost of purchase
iii) INVESTMENTS: Long term investments are carried at cost including
related expenses. In case of diminution in value other than temporary,
the carrying amount is reduced to recognize the decline cost.
iv) Raw Material consumption is net of Export benefits.
v) RESEARCH AND DEVELOPMENT: Research and development costs (other than
costs of fixed assets acquired) are charged as an expense in the year
in which they are incurred.
vi) EMPLOYEE BENEFITS: Short-term employee benefits (benefits which are
payable within twelve months after the end of the period in which the
employees render service) are measured at cost. Long -term employee
benefits (benefits which are payable after the end of twelve months
from the end of the period in which the employees render service) and
post employment benefits (benefits which are payable after completion
of employment) are measured on a discounted basis by the Projected Unit
Credit Method on the basis of annual third party actuarial valuations.
Contributions to Provident Fund, a defined contribution plan are made
in accordance with the statute, and are recognized as on expense when
employees have rendered service entitling them to the contributions.
The costs of providing leave encashment and gratuity, defined benefit
plans, are determined using the Projected Unit Credit Method , on the
basis of actuarial valuations carried out by third party actuaries at
each balance sheet date. The leave encashment and gratuity benefit
obligation recognized in the Balance Sheet represents the present value
of the obligations as reduced by the fair value of plan assets. Any
asset resulting from this calculation is limited to the discounted
value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan. Actuarial
gains and losses are recognized immediately in the Profit and Loss
Account.
vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:
Preliminary, Capital issue expenses are amortised in a period of ten
years. Upfront payment made for reduction in rate of interest and for
fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue
Expenses) are amortised in a period of five years.
viii) REVENUE RECOGNITION:
(a) The accounts of the company are prepared under the historical cost
convention and in accordance with the applicable accounting standards.
(b) Income is accounted for on accrual basis in accordance with
Accounting Standard (AS) 9-"Revenue Recognition" which provides that
where there is no reasonable certainty, the recognition of income be
postponed.
(c) Excise Duty is recognized on dispatches to parties except
consignment agents.
(d) Claims lodged with insurance companies and others are recognised in
accounts on lodgment to the extent they are measurable with reasonable
certainty of acceptance. Excess/Shortfall is adjusted in the year of
receipt.
ix) CENVAT
a. CENVAT claimed on capital goods (Plant and Machinery), except for
Plant and Machinery of Cotton Yarn Division and Service tax cenvat on
plant & machinery of Wartsila Power Division, is credited to Plant and
Machinery cost. Depreciation is not charged on the CENVAT claimed on
capital goods in the books of account as well as under the Income Tax
Act.
b. CENVAT on purchases of such inputs are deducted from the cost,
wherever the excise duty has been paid on finished goods manufactured
out of these inputs.
x) FOREIGN CURRENCY TRANSACTION-
Transactions in foreign currency are recorded at the exchange rate
prevailing at the date of the transaction. Exchange difference arising
on reporting of long term foreign currency monetary items at rates
different from those at which they were initially recorded during the
period, or reported in previous financial statements, in so far as they
relate to the acquisition of a depreciable capital asset is added to or
deducted from the cost of asset and depreciated over the balance life
of the asset, and in other cases it is accumulated in a "Foreign
currency Monetary item translation Difference account" and amortized
over the balance period of such long-term asset/liability up to 31st
March 2011, by recognition as income or expenses in each of such periods.
Current assets (other than inventories) and current liabilities (other
than those relating to fixed assets) are restated at the rates
prevailing at the year end or at the forward rates where forward cover
has been taken and the difference between the year end rate/forward
rate and the exchange rate at the date of the transactions is
recognised as income or expenses in the profit and loss account, and
over the life of the contract in the case of the forward cover.
xi) EXPORT BENEFITS - Export benefits including estimated duty
differentials accruing on account of entitlement for duty free raw
materials against indigenous/duty paid raw material consumed for
exports during the year are estimated and ascertained for at
the yearend.
xii) PROVISIONS AND CONTINGENT LIABILITIESÃ
a. Provisions are made when the present obligation of a past event
gives rise to probable outflow, embodying economic benefit on
settlement and the amount of obligation can be reliably estimated.
b. Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved
c. Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates.
xiii) TAXATION:
Provision for current tax is made in accordance with the provisions of
the Income Tax Act, 1961. Deferred tax on account of timing difference
between taxable and accounting income is provided considering the tax
rates and tax laws enacted or substantially enacted by the Balance
Sheet date in accordance with Accounting Standard 22 as notified by the
regulatory authorities.
xiv) EXCISE DUTY:
Excise duty on manufactured goods wherever applicable is accounted for
at the point of manufacture of goods and accordingly, is considered for
valuation of finished goods stock lying in the factories as on the
Balance Sheet date.
Mar 31, 2010
I) FIXED ASSETS AND DEPRECIATION:
a) Fixed Assets are stated at cost, net of Cenvat. All costs including
financing costs till commencement of commercial production and
adjustment arising from exchange rate variations relating to borrowings
attributable to the fixed assets are capitalised. Stores and spares
received along with the Plant & Machinery are being capitalised with
related machine.
b) Cotton Yarn unit and Wartsila Power Plant are stated at cost without
availing CENVAT, and thermal power plant is stated without availing
service tax cenvat. All costs including financing costs till
commencement of commercial production and adjustment arising from
exchange rate variations relating to borrowings attributable to the
fixed assets are capitalised
c) Depreciation on fixed assets is provided on straight line method at
the rates and in the manner prescribed in Schedule XIV to the Companies
Act, 1956 as amended except depreciation on incremental cost, arising
on account of conversion difference of foreign currency liabilities for
acquisition of fixed assets and stand by equipments , which are
amortised over the residual life of the respective assets.
d) Assets costing Rs.5000/- or less acquired on or after 1.7.1993 are
fully depreciated.
e) The company provides for depreciation on following plant & machinery
considering the same as continuous process plant.
(i) Filament Yarn Division , Spun Yarn Division and Cotton Yarn
Division
(ii) Power Generation Equipments
f) Free hold lands and leasehold lands are not depreciated.
g) Impairment of Assets à If the carrying amount of fixed assets
exceeds the recoverable amount on the reporting date, the carrying
amount is reduced to the recoverable amount. The recoverable amount is
measured as the highest of the net selling price and the value in use
determined by the present value of estimated future cash flows.
ii) INVENTORIES:
A Raw Materials At Batch cost.
B Stores, Spares At moving weighted average cost.
C Fuel Monthly weighted average
D Work-in-progress (i) Preparatory Stage - at cost
(ii) Yarn Stage - Cost or net realisable
value whichever is lower.
E Finished goods at cost or net realisable value which
ever is lower[Cost formula used in
clause (D) & (E): - Conversion cost
and other cost in bringing the
inventories to their present location
and condition.
F Waste and Scrap at net realisable value.
G Trading stocks at cost of purchase
H Materials taken/ at Cost/Book Value. On return of such
quantity, difference between the
given on loan amount adjusted and the Cost/Book
value of such return is adjusted in
respective materials account.
iii) INVESTMENTS:
Long term investments are carried at cost including related expenses.
In case of diminution in value other than temporary, the carrying
amount is reduced to recognize the decline cost.
iv) Raw Material consumption is net of Export benefits.
v) RESEARCH AND DEVELOPMENT:
Research and development costs (other than costs of fixed assets
acquired) are charged as an expense in the year in which they are
incurred.
vi) EMPLOYEE BENEFITS:
Short-term employee benefits (benefits which are payable within twelve
months after the end of the period in which the employees render
service ) are measured at cost. LongÃterm employee benefits ( benefits
which are payable after the end of twelve months from the end of the
period in which the employees render service ) and post employment
benefits ( benefits which are payable after completion of employment )
are measured on a discounted basis by the Projected Unit Credit Method
on the basis of annual third party actuarial valuations.
Contributions to Provident Fund , a defined contribution plan are made
in accordance with the statute , and are recognized as an expense when
employees have rendered service entitling them to the contributions.
The costs of providing leave encashment and gratuity ,defined benefit
plans, are determined using the Projected Unit Credit Method , on the
basis of actuarial valuations carried out by third party actuaries at
each balance sheet date. The leave encashment and gratuity benefit
obligation recognized in the Balance S h e e t represents the present
value of the obligations as reduced by the fair value of plan assets.
Any asset resulting from this calculation is limited to the discounted
value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan. Actuarial
gains and losses are recognized immediately in the Profit and Loss
Account.
vii) PRELIMINARY, CAPITAL ISSUES AND DEFERRED REVENUE EXPENSES:
Preliminary, Capital issue expenses are amortised in a period of ten
years. Upfront payment made for reduction in rate of interest and for
fresh Term Loans and amalgamation expenses(Debited to Deferred Revenue
Expenses) are amortised in a period of five years.
viii) REVENUE RECOGNITION:
(a) The accounts of the Company are prepared under the historical cost
convention and in accordance with the applicable accounting standards.
(b) Income is accounted for on accrual basis in accordance with
Accounting Standard (AS) 9-ÃRevenue Recognitionà which provides that
where there is no reasonable certainty, the recognition of income be
postponed.
(c) Sales are inclusive of Sales Tax and Excise Duty are recognized on
dispatches to parties except consignment agents.
(d) Claims lodged with insurance companies and others are recognised in
accounts on lodgment to the extent they are measurable with reasonable
certainty of acceptance. Excess/Shortfall is adjusted in the year of
receipt.
ix) CENVAT
a. CENVAT claimed on capital goods (Plant and Machinery),
except for Plant and Machinery of Cotton Yarn Division and Service tax
cenvat on plant & machinery of Wartsila Power Division, is credited to
Plant and Machinery cost. Depreciation is not charged on the CENVAT
claimed on capital goods in the books of account as well as under the
Income Tax Act.
b. CENVAT on purchases of such inputs are deducted from the cost,
wherever the excise duty has been paid on finished goods manufactured
out of these inputs.
x) FOREIGN CURRENCY TRANSACTION
Transactions in foreign currency are recorded at the exchange rate
prevailing at the date of the transaction. Exchange difference arising
on reporting of long term foreign currency monetary items at rates
different from those at which they were initially recorded during the
period, or reported in previous financial statements, in so far as they
relate to the acquisition of a depreciable capital asset is added to or
deducted from the cost of asset and depreciated over the balance life
of the asset, and in other cases it is accumulated in a ÃForeign
currency Monetary item translation Difference account" and amortized
over the balance period of such long term asset/liability up to 31st
March, 2011, by recognition as income or expenses in each of such
periods. Current assets (other than inventories) and current
liabilities (other than those relating to fixed assets) are restated at
the rates prevailing at the year end or at the forward rates where
forward cover has been taken and the difference between the year end
rate/forward rate and the exchange rate at the date of the transactions
is recognised as income or expenses in the profit and loss account, and
over the life of the contract in the case of the forward cover.
xi) EXPORT BENEFITS
Export benefits including estimated duty differentials accruing on
account of entitlement for duty free raw materials against
indigenous/duty paid raw material consumed for exports during the year
are estimated and ascertained for at the year end.
xii) PROVISIONS AND CONTINGENT LIABILITIES
a. Provisions are made when the present obligation of a past event
gives rise to probable outflow, embodying economic benefit on
settlement and the amount of obligation can be reliably estimated.
b. Contingent Liabilities are disclosed after a careful evaluation of
facts and legal aspects of the matter involved
c. Provisions and Contingent Liabilities are reviewed at each Balance
Sheet date and adjusted to reflect the current best estimates.
xiii) TAXATION :
Provision for current tax is made in accordance with the provisions of
the Income Tax Act, 1961. Deferred tax on account of timing difference
between taxable and accounting income is provided considering the tax
rates and tax laws enacted or substantially enacted by the Balance
Sheet date in accordance with Accounting Standard 22 as notified by the
regulatory authorities.
xiv) EXCISE DUTY :
Excise duty on manufactured goods wherever applicable is accounted for
at the point of manufacture of goods and accordingly, is considered for
valuation of finished goods stock lying in the factories as on the
Balance Sheet date.