Mar 31, 2016
NOTE 1: SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation of Financial Statement
These financial statements are prepared on accrual basis under the historical cost convention to comply in all material aspects with all the applicable accounting principles in India, the applicable Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) in accordance with section 133 of the Companies Act, 2013, read with rule 7 of Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 and guidelines issued by the Securities and Exchange Board of India.
(b ) Use of Estimates
The preparation of the financial statements in conformity with Indian generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Examples of such estimates include provisions for doubtful receivables, future obligations under employee retirement benefit plans, income taxes and the useful lives of fixed assets and intangible assets.
(c) Fixed Assets
Fixed assets are stated at their original cost less accumulated depreciation including freight, duties (net of CENVAT), taxes and other incidental expenses relating to acquisition and installation.
(d) Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is provided on the straight line method on a pro-rata basis at the rates determined on the basis of useful lives of the respective assets as provided by Schedule II to the Companies Act, 2013. The useful lives for the various fixed assets situated at manufacturing locations are as follows:
Depreciation for all fixed assets at locations other than at manufacturing locations is provided on the written down value method at the rates determined on the basis of useful lives of the respective assets as provided by Schedule II to the Companies Act, 2013
Leasehold land is amortized over the lease period on a straight line basis.
Capitalized enterprise resource planning software (SAP) is amortized over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a period of 10 years.
(e) Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the specific identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and spares is determined using the weighted average cost method and includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
(f) Revenue Recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of significant risk and rewards of ownership to the buyer and on reasonable certainty of the ultimate collection. Sales are inclusive of excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognized on a time proportion basis taking into account the amount outstanding and the applicable rates. Commission and insurance claim: Income is recognized when no significant uncertainty as to measurability or recoverability exists.
(g) Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments (non -current investment). Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.
(h) Foreign Currency Transactions
Transactions in foreign currency are accounted for at the exchange rates prevailing on the date of transaction. All monetary items denominated in foreign currency are translated at year end rates. Exchange differences arising on such transactions and also exchange differences arising on the settlement of such transactions are adjusted in the statement of profit and loss.
In case of forward contracts, the premium or discount on all such contracts arising at the inception of each contract is recognized / amortized as income or expense over the life of the contract. Any profit or loss arising on the cancellation or renewal of such contracts is recognized as income or expense for the period.
In respect of foreign branch, all revenues, expenses, monetary assets/liabilities and fixed assets are accounted at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities are restated at the year end rates and resultant gains or losses are recognized in the statement of profit and loss.
(i) Employee Benefits
The Company''s contributions to recognized provident funds are charged to revenue on an accrual basis.
The Company has defined benefit plans namely leave encashment and gratuity for all employees, the liability for which is determined on the basis of an actuarial valuation at the end of the year. Gratuity Fund (for other than Synthetic division) is administered through Life Insurance Corporation of India. Short term compensated absences are recognized at the undiscounted amount of benefit for services rendered during the year.
Termination benefits are recognized as an expense immediately. Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognized immediately in the statement of profit and loss as income or expense.
(j) Borrowing Costs
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as a part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which they are incurred. (k) Taxation
Tax expenses for the year, comprising current tax and deferred tax is included in determining the net profit/(loss) for the year. A provision is made for the current tax based on tax liability computed in accordance with relevant tax rates and tax laws. Deferred tax assets are recognized for all deductible timing differences and carried forward to the extent it is reasonably / virtually certain that future taxable profit will be available against which such deferred tax assets can be realized.
Deferred tax assets and liabilities are measured at the tax rates that have been enacted or substantively enacted by the balance sheet date.
(l) Leases
Assets acquired under long term finance lease are capitalized and depreciated in accordance with company''s policy for assets situated at manufacturing and other locations. The associated obligations are included in other loans under "Long Term Borrowings".
The company has taken premises on lease. Lease rental in respect of operating lease arrangement are charged to statement of profit and loss.
(m) Impairment of Assets
At each balance sheet date, the Company assesses whether there is any indication that an asset may be impaired. If such indication exists, the company estimates the recoverable amount and where carrying amount of the asset exceeds such recoverable amount, an impairment loss is recognized in the statement of profit and loss to the extent the carrying amount exceeds recoverable amount. Where there is any indication that an impairment loss recognized for an asset in prior accounting periods may no longer exist or may have decreased, the company books a reversal of the impairment loss not exceeding the carrying amount that would have been determined (net of amortization or depreciation) had no impairment loss been recognized for the asset in prior accounting periods.
(n) Government Grants Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted with the value of the fixed assets.
ii) Government grants in the nature of promoters'' contribution, i.e. which have reference to the total investment in an undertaking or by way of contribution towards total capital outlay, are credited to capital reserve.
iii) Government grants related to revenue items are either adjusted with the related expenditure / revenue or shown under "Other Income", in case direct linkage with cost /income is not determinable.
(o) Provisions and contingencies
The company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of obligation. A disclosure for a contingent liability is made when there is possible obligation or a present obligation that probably will not require an outflow of resources or where a reliable estimate of the obligation cannot be made.
Mar 31, 2015
(a) Basis of preparation of Financial Statement
These financial statements are prepared on accrual basis under the
historical cost convention to comply in all material aspects with all
the applicable accounting principles in India, the applicable
Accounting Standards notified under the Companies (Accounting
Standards) Rules, 2006 (as amended) in accordance with section 133 of
the Companies Act, 2013, read with rule 7 of Companies (Accounts)
Rules, 2014 and the relevant provisions of the Companies Act, 2013 and
guidelines issued by the Securities and Exchange Board of India.
(b ) Use of Estimates
The preparation of the financial statements in conformity with Indian
generally accepted accounting principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful receivables, future
obligations under employee retirement benefit plans, income taxes and
the useful lives of fixed assets and intangible assets.
(c) Fixed Assets
Fixed assets are stated at their original cost less accumulated
depreciation including freight, duties (net of CENVAT), taxes and other
incidental expenses relating to acquisition and installation.
(d) Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets as
provided by Schedule II to the Companies Act, 2013. The useful lives
for the various fixed assets situated at manufacturing locations are as
follows :
Description - Manufacturing locations Useful lives (in years)
Factory Building 30
Building (Other than factory building)
RCC frame structure 60
Building (Other than factory building)
other than RCC frame structure 30
Plant and Machinery 25
Office Equipments 5
Computers 3
Furniture and Fixtures 10
Vehicles 8
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates determined on the basis of useful lives of the respective
assets as provided by schedule II to the Companies Act, 2013.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
(e) Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method and
includes direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
(f) Revenue Recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates. Commission
and insurance claim: Income is recognized when no significant
uncertainty as to measurability or recoverability exists.
(g) Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments(non -current
investment). Current investments are carried at lower of cost and fair
value determined on an individual investment basis. Long-term
investments are carried at cost. However, provision for diminution in
value is made to recognise a decline other than temporary in the value
of the investments.
(h) Foreign Currency Transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary items
denominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also exchange
differences arising on the settlement of such transactions are adjusted
in the statement of profit and loss. In case of forward contracts, the
premium or discount on all such contracts arising at the inception of
each contract is recognized / amortized as income or expense over the
life of the contract. Any profit or loss arising on the cancellation or
renewal of such contracts is recognized as income or expense for the
period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange rate
prevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the statement of profit and loss.
(i) Employee Benefits
The Company's contributions to recognized provident funds are charged
to revenue on an accrual basis. The Company has defined benefit plans
namely leave encashment and gratuity for all employees, the liability
for which is determined on the basis of an actuarial valuation at the
end of the year. Gratuity Fund (for other than Synthetic division) is
administered through Life Insurance Corporation of India. Short term
compensated absences are recognized at the undiscounted amount of
benefit for services rendered during the year.
Termination benefits are recognized as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the statement of profit and loss as income or expense.
(j) Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expenses in the period in which they are incurred.
(k) Taxation
Tax expenses for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year. A
provision is made for the current tax based on tax liability computed
in accordance with relevant tax rates and tax laws. Deferred tax
assets are recognised for all deductible timing differences and carried
forward to the extent it is reasonably / virtually certain that future
taxable profit will be available against which such deferred tax assets
can be realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the balance sheet date.
(l) Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with company's policy for assets situated at
manufacturing and other locations. The associated obligations are
included in other loans under "Long Term Borrowings".
The company has taken premises on lease. Lease rental in respect of
operating lease arrangement are charged to statement of profit and
loss.
(m) Impairment of Assets
At each balance sheet date, the Company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the statement of profit and loss to the extent the
carrying amount exceeds recoverable amount. Where there is any
indication that an impairment loss recognized for an asset in prior
accounting periods may no longer exist or may have decreased, the
company books a reversal of the impairment loss not exceeding the
carrying amount that would have been determined (net of amortization or
depreciation) had no impairment loss been recognized for the asset in
prior accounting periods.
(n) Government Grants Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters' contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items are either adjusted
with the related expenditure / revenue or shown under "Other Income",
in case direct linkage with cost /income is not determinable.
(o) Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
outflow of resources or where a reliable estimate of the obligation
cannot be made.
Mar 31, 2014
(a) Basis of preparation of Financial Statement
These financial statements are prepared on accrual basis under the
historical cost convention to comply in all material aspects with all
the applicable accounting principles in India, the applicable
Accounting Standards notified u/s 211(3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956 and guidelines
issued by the Securities and Exchange Board of India.
(b ) Use of Estimates
The preparation of the financial statements in conformity with Indian
generally accepted accounting principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful receivables, future
obligations under employee retirement benefit plans, income taxes and
the useful lives of fixed assets and intangible assets.
(c) Fixed Assets
Fixed assets are stated at their original cost less accumulated
depreciation including freight, duties (net of CENVAT), taxes and other
incidental expenses relating to acquisition and installation.
(d) Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets.
Management estimates the useful lives for the various fixed assets
situated at manufacturing locations as follows:
The rates derived from the above useful lives are higher than the
minimum rates specified in Schedule XIV to the Companies Act, 1956
(''Act'').
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates specified in Schedule XIV to the Act.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
(e) Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method and
includes direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
(f) Revenue Recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates. Commission
and insurance claim: Income is recognized when no significant
uncertainty as to measurability or recoverability exists.
(g) Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments(non -current
investment). Current investments are carried at lower of cost and fair
value determined on an individual investment basis. Long-term
investments are carried at cost. However, provision for diminution in
value is made to recognise a decline other than temporary in the value
of the investments.
(h) Foreign Currency Transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary items
denominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also exchange
differences arising on the settlement of such transactions are adjusted
in the statement of profit and loss.
In case of forward contracts, the premium or discount on all such
contracts arising at the inception of each contract is recognized /
amortized as income or expense over the life of the contract. Any
profit or loss arising on the cancellation or renewal of such contracts
is recognized as income or expense for the period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange rate
prevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the statement of profit and loss.
(i) Employee Benefits
The Company''s contributions to recognized provident funds are charged
to revenue on an accrual basis.
The Company has defined benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund (for other than Synthetic division) is administered through Life
Insurance Corporation of India. Short term compensated absences are
recognized at the undiscounted amount of benefit for services rendered
during the year.
Termination benefits are recognized as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the statement of profit and loss as income or expense.
(j) Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expenses in the period in which they are incurred.
(k) Taxation
Tax expenses for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year.
A provision is made for the current tax based on tax liability computed
in accordance with relevant tax rates and tax laws. Deferred tax
assets are recognised for all deductible timing differences and carried
forward to the extent it is reasonably / virtually certain that future
taxable profit will be available against which such deferred tax assets
can be realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the balance sheet date.
(l) Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with company''s policy for assets situated at
manufacturing and other locations. The associated obligations are
included in other loans under "Long Term Borrowings".
The company has taken premises on lease. Lease rental in respect of
operating lease arrangement are charged to statement of profit and
loss.
(m) Impairment of Assets
At each balance sheet date, the Company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the statement of profit and loss to the extent the
carrying amount exceeds recoverable amount. Where there is any
indication that an impairment loss recognized for an asset in prior
accounting
periods may no longer exist or may have decreased, the company books a
reversal of the impairment loss not exceeding the carrying amount that
would have been determined (net of amortization or depreciation) had no
impairment loss been recognized for the asset in prior accounting
periods.
(n) Government Grants Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters'' contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items are either adjusted
with the related expenditure / revenue or shown under "Other
Income", in case direct linkage with cost /income is not
determinable.
(o) Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
outflow of resources or where a reliable estimate of the obligation
cannot be made.
Mar 31, 2013
(a) Basis of Accounting
These financial statements are prepared on accrual basis under the
historical cost convention to comply in all material aspects with all
the applicable accounting principles in India, the applicable
Accounting Standards notified u/s 211(3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956 and guidelines
issued by the Securities and Exchange Board of India.
(b ) Use of Estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful receivables, future
obligations under employee retirement benefit plans, income taxes and
the useful lives of fixed assets and intangible assets.
(c) Fixed Assets
Fixed assets are stated at their original cost less accumulated
depreciation including freight, duties (net of CENVAT), taxes and other
incidental expenses relating to acquisition and installation.
(d) Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets.
Management estimates the useful lives for the various fixed assets
situated at manufacturing locations as follows:
The rates derived from the above useful lives are higher than the
minimum rates specified in Schedule XIV to the Companies Act, 1956
(ÂActÂ).
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates specified in Schedule XIV to the Act.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
(e) Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method and
includes direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
(f) Revenue Recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates.
Commission and insurance claim: Income is recognized when no
significant uncertainty as to measurability or recoverability exists.
(g) Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments(non -current
investment). Current investments are carried at lower of cost and fair
value determined on an individual investment basis. Long-term
investments are carried at cost. However, provision for diminution in
value is made to recognise a decline other than temporary in the value
of the investments.
(h) Foreign Currency Transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary items
denominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also exchange
differences arising on the settlement of such transactions are adjusted
in the statement of profit and loss.
In case of forward contracts, the premium or discount on all such
contracts arising at the inception of each contract is recognized /
amortized as income or expense over the life of the contract. Any
profit or loss arising on the cancellation or renewal of such contracts
is recognized as income or expense for the period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange rate
prevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the statement of profit and loss.
(i) Employee Benefits
The Company''s contributions to recognized provident funds are charged
to revenue on an accrual basis.
The Company has defined benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund (for other than Synthetic division) is administered through Life
Insurance Corporation of India. Short term compensated absences are
recognized at the undiscounted amount of benefit for services rendered
during the year.
Termination benefits are recognized as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the statement of profit and loss as income or expense.
(j) Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expenses in the period in which they are incurred.
(k) Taxation
Tax expenses for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year.
A provision is made for the current tax based on tax liability computed
in accordance with relevant tax rates and tax laws. Deferred tax
assets are recognised for all deductible timing differences and carried
forward to the extent it is reasonably / virtually certain that future
taxable profit will be available against which such deferred tax assets
can be realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the balance sheet date.
(l) Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with companyÂs policy for assets situated at
manufacturing and other locations. The associated obligations are
included in other loans under "Long Term Borrowings".
The company has taken premises on lease. Lease rental in respect of
operating lease arrangement are charged to statement of profit and
loss.
(m) Impairment of Assets
At each balance sheet date, the Company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the statement of profit and loss to the extent the
carrying amount exceeds recoverable amount. Where there is any
indication that an impairment loss recognized for an asset in prior
accounting periods may no longer exist or may have decreased, the
company books a reversal of the impairment loss not exceeding the
carrying amount that would have been determined (net of amortization or
depreciation) had no impairment loss been recognized for the asset in
prior accounting periods.
(n) Government Grants Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items are either adjusted
with the related expenditure / revenue or shown under "Other Income",
in case direct linkage with cost /income is not determinable.
(o) Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
out flow of resources or where a reliable estimate of the obligation
cannot be made.
Mar 31, 2012
(a) Basis of Accounting
These financial statements are prepared on accrual basis under the
historical cost convention to comply in all material aspects with all
the applicable accounting principles in India, the applicable
accounting standards notified u/s 211(3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956 and guidelines
issued by the Securities and Exchange Board of India.
(b) Adoption of Revised Schedule VI of the Companies Act, 1956
For the year ended 31st March, 2012, the revised Schedule VI, notified
under the Companies Act, 1956 has become applicable to the Company for
preparation and presentation of its financial statements. The adoption
of Schedule VI does not impact recognition and measurement principles
followed for preparation of its financial statements. However, it has
significant impact on presentation and disclosures made in the
financial statements. The Company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year. All assets and liabilities have been classified as
current and non-current as per the criteria set out in the revised
Schedule VI. 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 being
a period within 12 months for the purpose of classification of assets
and liabilities as current and non current.
(c ) Use of Estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful receivables, future
obligations under employee retirement benefit plans, income taxes and
the useful lives of fixed assets and intangible assets.
(d) Fixed Assets
Fixed assets are stated at their original cost less accumulated
depreciation including freight, duties (net of CENVAT), taxes and other
incidental expenses relating to acquisition and installation.
(e) Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets.
Management estimates the useful lives for the various fixed assets
situated at manufacturing locations as follows:
The rates derived from the above useful lives are higher than the
minimum rates specified in Schedule XIV to the Companies Act, 1956
('Act').
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates specified in Schedule XIV to the Act.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
(f) Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method and
includes direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
(g) Revenue Recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates. Commission
and insurance claim: Income is recognized when no significant
uncertainty as to measurability or recoverability exists.
(h) Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long-term investments are carried at
cost. However, provision for diminution in value is made to recognise a
decline other than temporary in the value of the investments.
(i) Foreign Currency Transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary items
denominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also exchange
differences arising on the settlement of such transactions are adjusted
in the statement of profit and loss.
In case of forward contracts, the premium or discount on all such
contracts arising at the inception of each contract is recognized /
amortized as income or expenses over the life of the contract. Any
profit or loss arising on the cancellation or renewal of such contracts
is recognized as income or expenses for the period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange rate
prevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the statement of profit and loss.
(j) Employee Benefits
The company's contributions to recognized provident funds are charged
to revenue on an accrual basis.
The Company has defined benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund (for other than Synthetic division) is administered through Life
Insurance Corporation of India. Short term compensated absences are
recognized at the undiscounted amount of benefit for services rendered
during the year.
Termination benefits are recognized as an expenses immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the statement of profit and loss as income or expenses.
(k) Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expenses in the period in which they are incurred. (l) Taxation
Tax expenses for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year.
A provision is made for the current tax based on tax liability computed
in accordance with relevant tax rates and tax laws. Deferred tax
assets are recognised for all deductible timing differences and carried
forward to the extent it is reasonably / virtually certain that future
taxable profit will be available against which such deferred tax assets
can be realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the balance sheet date.
(m) Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with company's policy for assets situated
at manufacturing and other locations. The associated obligations are
included in other loans under "Secured Loans". The company has
taken premises on lease. Lease rental in respect of operating lease
arrangement are charged to statement of profit and loss.
(n) Impairment of Assets
At each balance sheet date, the company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the statement of profit and loss to the extent the
carrying amount exceeds recoverable amount. Where there is any
indication that an impairment loss recognized for an asset in prior
accounting periods may no longer exist or may have decreased, the
company books a reversal of the impairment loss not exceeding the
carrying amount that would have been determined (net of amortization or
depreciation) had no impairment loss been recognized for the asset in
prior accounting periods.
(o) Government Grants Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters' contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items are either adjusted
with the related expenditure / revenue or shown under "Other
Income", in case direct linkage with cost /income is not
determinable.
(p) Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
outflow of resources or where a reliable estimate of the obligation
cannot be made.
Mar 31, 2011
1. Basis of Accounting
These Financial Statements are prepared to comply in all material
aspects with all the applicable accounting principles in India, the
applicable accounting standards notified u/s 211(3C) of the Companies
Act, 1956 and the relevant provisions of the Companies Act, 1956 and
guidelines issued by the Securities and Exchange Board of India.
2. Use of Estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful debts, future obligations
under employee retirement benefit plans, income taxes and the useful
lives of fixed assets and intangible assets.
3. Fixed Assets
Fixed Assets are stated at their original cost including freight,
duties (net of CENVAT), taxes and other incidental expenses relating to
acquisition and installation.
4. Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets.
Management estimates the useful lives for the various fixed assets
situated at manufacturing locations as follows
Description à Manufacturing locations Useful lives(in years)
Factory Building 17-29
Building (Other than factory building) 58
Plant and Machinery 2-18
Office Equipments 10-20
Computers 1-6
Furniture and Fixtures 2-15
Vehicles 10-12
The rates derived from the above useful lives are higher than the
minimum rates specified in Schedule XIV to the Companies Act, 1956
(Act).
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates specified in Schedule XIV to the Act.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
5. Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the Specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method and
includes direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity, where applicable.
Waste is valued at estimated net realizable value.
6. Revenue recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates. Commission
and Insurance claim: Income is recognized when no significant
uncertainty as to measurability or recoverability exists.
7. Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long-term investments are carried at
cost. However, provision for diminution in value is made to recognise a
decline other than temporary in the value of the investments.
8. Foreign currency transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary items
denominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also exchange
differences arising on the settlement of such transactions are adjusted
in the Profit and Loss Account.
In case of forward contracts, the premium or discount on all such
contracts arising at the inception of each contract is recognized /
amortized as income or expense over the life of the contract. Any
profit or loss arising on the cancellation or renewal of such contracts
is recognized as income or expense for the period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange rate
prevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the Profit and Loss Account.
9. Employee benefits
The Companys contributions to recognized Provident Funds are charged
to revenue on an accrual basis.
The Company has Defined Benefit plans namely Leave Encashment and
Gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund (for other than Synthetic division) is administered through Life
Insurance Corporation of India. Short term compensated absences are
recognized at the undiscounted amount of benefit for services rendered
during the year.
Termination benefits are recognized as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the Profit and Loss Account as income or expense.
10. Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expense in the period in which they are incurred.
11. Taxation
Tax expense for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year.
A provision is made for the current tax based on tax liability computed
in accordance with relevant tax rates and tax laws. Deferred tax assets
are recognised for all deductible timing differences and carried
forward to the extent it is reasonably / virtually certain that future
taxable profit will be available against which such deferred tax assets
can be realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the Balance Sheet date.
12. Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with Companys policy for assets situated at
manufacturing and other locations. The associated obligations are
included in other loans under ÃSecured LoansÃ.
The company has taken premises on lease. Lease rental in respect of
operating lease arrangement are charged to Profit and Loss Account.
13. Impairment of Assets
At each balance sheet date, the Company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the Company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the profit and loss account to the extent the carrying
amount exceeds recoverable amount. Where there is any indication that
an impairment loss recognized for an asset in prior accounting periods
may no longer exist or may have decreased, the Company books a reversal
of the impairment loss not exceeding the carrying amount that would
have been determined (net of amortization or depreciation) had no
impairment loss been recognized for the asset in prior accounting
periods.
14. Government Grants
Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made. Presentation in Financial
Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items are either adjusted
with the related expenditure / revenue or shown under ÃOther IncomeÃ,
in case direct linkage with cost /income is not determinable.
15. Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
outflow of resources or where a reliable estimate of the obligation
cannot be made
Mar 31, 2010
1. Basis of Accounting
These Financial Statements are prepared to comply in all material
aspects with all the applicable accounting principles in India, the
applicable accounting standards notified u/s 211(3C) of the Companies
Act, 1956 and the relevant provisions of the Companies Act, 1956 and
guidelines issued by the Securities and Exchange Board of India.
2. Use of Estimates
The preparation of the financial statements in conformity with Indian
Generally Accepted Accounting Principles requires the management to
make estimates and assumptions that affect the reported balances of
assets and liabilities and disclosures relating to contingent assets
and liabilities as at the date of the financial statements and reported
amounts of income and expenses during the period. Examples of such
estimates include provisions for doubtful debts, future obligations
under employee retirement benefit plans, income taxes and the useful
lives of fixed assets and intangible assets.
3. Fixed Assets
Fixed Assets are stated at their original cost including freight,
duties (net of CENVAT), taxes and other incidental expenses relating to
acquisition and installation.
4. Depreciation / Amortization
Depreciation on all fixed assets situated at manufacturing locations is
provided on the straight line method on a pro-rata basis at the rates
determined on the basis of useful lives of the respective assets.
Management estimates the useful lives for the various fixed assets
situated at manufacturing locations as follows
The rates derived from the above useful lives are higher than the
minimum rates specified in Schedule XIV to the Companies Act, 1956
(Act).
Depreciation for all fixed assets at locations other than at
manufacturing locations is provided on the written down value method at
the rates specified in Schedule XIV to the Act.
Leasehold land is amortized over the lease period on a straight line
basis.
Capitalised enterprise resource planning software (SAP) is amortised
over a period of five years on straight line basis.
Acquired goodwill is amortized using the straight-line method over a
period of 10 years.
5. Inventories
Inventories have been valued at lower of cost and net realizable value.
The cost in respect of raw materials is determined under the Specific
identification of cost method.
Cost includes customs duty, wherever paid, and are net of credit under
CENVAT scheme, wherever applicable.
The cost in respect of work-in-progress, finished goods and stores and
spares is determined using the weighted average cost method
and includes direct materials and labour and a proportion of
manufacturing overheads based on normal operating capacity, where
applicable.
Waste is valued at estimated net realizable value.
6. Revenue recognition
Sale of goods: Revenue on sale of goods is recognized on transfer of
significant risk and rewards of ownership to the buyer and on
reasonable certainty of the ultimate collection. Sales are inclusive of
excise duty and net off sales tax, trade discounts and sales returns.
Interest: Income is recognised on a time proportion basis taking into
account the amount outstanding and the applicable rates. Commission
and Insurance claim: Income is recognized when no significant
uncertainty as to measurability or recoverability exists.
7. Investments
Investments that are readily realisable and intended to be held for not
more than a year are classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value determined on
an individual investment basis. Long-term investments are carried at
cost. However, provision for diminution in value is made to recognise a
decline other than temporary in the value of the investments.
8. Foreign currency transactions
Transactions in foreign currency are accounted for at the exchange
rates prevailing on the date of transaction. All monetary
itemsdenominated in foreign currency are translated at year end rates.
Exchange differences arising on such transactions and also
exchangedifferences arising on the settlement of such transactions are
adjusted in the Profit and Loss Account.
In case of forward contracts, the premium or discount on all such
contracts arising at the inception of each contract is recognized /
amortized as income or expense over the life of the contract. Any
profit or loss arising on the cancellation or renewal of such contracts
isrecognized as income or expense for the period.
In respect of foreign branch, all revenues, expenses, monetary
assets/liabilities and fixed assets are accounted at the exchange
rateprevailing on the date of the transaction. Monetary assets and
liabilities are restated at the year end rates and resultant gains or
losses are recognized in the Profit and Loss Account.
9. Employee benefits
The Companys contributions to recognized Provident Funds are charged
to revenue on an accrual basis.The Company has Defined Benefit plans
namely Leave Encashment and Gratuity for all employees, the liability
for which is determinedon the basis of an actuarial valuation at the
end of the year. Gratuity Fund (for other than Synthetic division) is
administered through LifeInsurance Corporation of India. Short term
compensated absences are recognized at the undiscounted amount of
benefit for services rendered during the year
Termination benefits are recognized as an expense immediately.
Actuarial gains and losses comprise experience adjustments and
theeffects of changes in actuarial assumptions and are recognised
immediately in the Profit and Loss Account as income or expense.
10. Borrowing Costs
Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised as a
part of the cost of that asset. Other borrowing costs are recognised as
an expense in the period in which they are incurred.
11. Taxation
Tax expense for the year, comprising current tax and deferred tax is
included in determining the net profit/(loss) for the year.A provision
is made for the current tax based on tax liability computed in
accordance with relevant tax rates and tax laws. Deferred taxassets are
recognised for all deductible timing differences and carried forward to
the extent it is reasonably / virtually certain that futuretaxable
profit will be available against which such deferred tax assets can be
realised.
Deferred tax assets and liabilities are measured at the tax rates that
have been enacted or substantively enacted by the Balance Sheet date.
12. Leases
Assets acquired under long term finance lease are capitalised and
depreciated in accordance with Companys policy for assets situatedat
manufacturing and other locations. The associated obligations are
included in other loans under "Secured Loans".
The company has taken premises on lease. Lease rental in respect of
operating lease arrangement are charged to Profit and Loss Account.
13. Impairment of Assets
At each balance sheet date, the Company assesses whether there is any
indication that an asset may be impaired. If such indication exists,
the Company estimates the recoverable amount and where carrying amount
of the asset exceeds such recoverable amount, an impairment loss is
recognized in the profit and loss account to the extent the carrying
amount exceeds recoverable amount. Where there is any indication that
an impairment loss recognized for an asset in prior accounting periods
may no longer exist or may have decreased, the Company books a reversal
of the impairment loss not exceeding the carrying amount that would
have been determined (net of amortization or depreciation) had no
impairment loss been recognized for the asset in prior accounting
periods.
14. Government Grants
Recognition
Government grants are recognized where:
i) There is reasonable assurance of complying with the conditions
attached to the grant.
ii) Such grant / benefit has been earned and it is reasonably certain
that the ultimate collection will be made.
Presentation in Financial Statement:
i) Government grants relating to specific fixed assets are adjusted
with the value of the fixed assets.
ii) Government grants in the nature of promoters contribution, i.e.
which have reference to the total investment in an undertaking or by
way of contribution towards total capital outlay, are credited to
capital reserve.
iii) Government grants related to revenue items areeither adjusted with
the related expenditure / revenue or shown under "Other
Income", in case direct linkage with cost /income is not determinable.
15. Provisions and contingencies
The company creates a provision when there is present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation. A
disclosure for a contingent liability is made when there is possible
obligation or a present obligation that probably will not require an
outflow of resources or where a reliable estimate of the obligation
cannot be made .