Accounting Policies of SunRakshakk Industries India Ltd. Company

Mar 31, 2025

MATERIAL ACCOUNTING POLICIES:

A. Current and Non-Current Classifications:-

All the assets and liabilities have been classified as current or non-current as per the Company''s normal
operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013

Assets:

An asset is classified as current when it satisfies any of the following criteria:

• Expected to be realized or intended to be sold or consumed in the normal operating cycle;

• Held primarily for the purpose of trading;

• Expected to be realized within twelve months after the reporting period; or

• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve
months after the reporting period.

Assets held for sale:

An Assets are classified as held for sale if their carrying amount will be recovered principally through a sale
transaction rather than through continuing use. This condition is regarded as met only when the asset is
available for immediate sale in its present condition subject only to terms that are usual and customary for
sales of such asset and its sale is highly probable. Management must be committed to the sale, which should
be expected to qualify for recognition as a completed sale within one year from the date of classification.

The value of Assets has been carried out at its fair value less cost of sales.

Liability:

A liability is classified as current when it satisfies any of the following criteria:

• It is expected to be settled in the normal operating cycle;

• It is held primarily for the purpose of trading;

• It is due to be settled within twelve months after the reporting period; or

• There is no unconditional right to defer the settlement of the liability for at least twelve months after the
reporting period.

The Company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

Operating cycle:-

Operating cycle of the Company is the time between the acquisition of assets for processing and their
realization in cash or cash equivalents. As the Company''s normal operating cycle is not clearly identifiable, it
is assumed to be twelve months.

B. Property, plant and equipment (PPE):-

- PROPERTY, PLANT & EQUIPMENT is recognized when it is probable that future economic benefits associated
with the items will flow to the company and the cost of the item can be measured reliably. The cost of
Property Plant & Equipment comprises its purchase price net of any trade discounts and rebates, any import
duty and other taxes any directly attributable expenditure on making the asset ready for its intended use
including relevant borrowing cost for qualifying asset. Expenditure incurred after Property Plant & Equipment
have been put into operation such as repair & maintenance are charged to the statement of Profit & Loss in
the year in which the costs are incurred, Major shutdown and overhaul expenditure are capitalized as the
activities undertaken improves the economic benefit expected to arise from the assets.

- PPE not ready for the intended use on the date of the Balance Sheet is disclosed as "Capital Work-in Progress".

- Assets in the course of construction are capitalized in the assets under construction account. At the point
when the asset is operating at management''s intended use, the cost of construction is transferred to the
appropriate category of the PROPERTY, PLANT & EQUIPMENT and depreciation commences. Cost associated
with the commissioning of the asset and any obligatory decommissioning costs are capitalized where the
asset is available for use but incapable of operating at normal levels until a year of commissioning has been
completed. Revenue generated from production during the trial period capitalized.

- Capital subsidy received against specific assets is reduced from the value of relevant Property, Plant &
Equipment.

- Items of stores and spares that meet the definition of property, plant and equipment are capitalized at cost.
Otherwise, such items are classified as inventories.

- An item of Property, Plant & Equipment is derecognized upon disposal or when no future economic benefits
are expected to arise from the continued use of asset. Any gain or loss arising on the disposal or retirement
of an item of PROPERTY, PLANT & EQUIPMENT is determined as the difference between the sales proceeds
and the carrying amount of the asset and is recognized in statement of profit & loss.

C. Depreciation and Amortization: -

Depreciation on Property, Plant and Equipment is provided as follows:-

i. For all assets except Plant & Machinery (Textile division) useful life of the asset as specified in Part "C" of
Schedule II of Companies Act, 2013 except for Plant & Machinery related to processing division covered under
part (ii). The useful lives and residual values are based on the Company''s historical experience with similar
assets and take into account anticipated technological changes.

Depreciation on additions to property, plant and equipment is provided on a pro-rata basis from the date of
acquisition or installation, and in the case of a new project, from the date of commencement of commercial
production. Depreciation on an item of property, plant and equipment sold, discarded, demolished or
scrapped, is provided up to the date on which such item of property, plant and equipment is sold, discarded,
demolished or scrapped. When parts of an item of property, plant and equipment have different useful life,
they are accounted for as separate items (Major Components) and are depreciated over their useful life or
over the remaining useful life of the principal assets whichever is less.

The Company reviews the residual value, useful lives and depreciation method annually and, if expectations
differ from previous estimates, the change is accounted for as a change in accounting estimate on a prospective
basis.

ii. For Plant & Machinery related to textile division-Assets are depreciated using written down value method
(WDV method) as prescribed under Part C of Schedule II to the Companies 2013 due to heavy wear & tear and
nature of machines.

D. Intangible assets:-

Intangible Assets are stated at cost of acquisition net of recoverable taxes, trade discount and rebates less
accumulated amortization/depletion and impairment loss, if any. Such cost includes purchase price, borrowing
costs, and any cost directly attributable to bringing the asset to its working condition for the intended use, net
charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to
the intangible assets.

Subsequent costs are included in the asset''s carrying amount or recognized as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the entity and the
cost can be measured reliably.

E. Capital Work in Progress:-

Capital work in progress are stated at cost and inclusive of preoperative expenses, project development
expenses etc.

F. Impairment of assets

As at the end of each accounting year, the company reviews the carrying amounts of its PPE, investment
property, intangible assets and investments in subsidiary company to determine whether there is any
indication that those assets have suffered an impairment loss. If such indication exists, the said assets are
tested for impairment so as to determine the impairment loss, if any. The intangible assets with indefinite life
are tested for impairment each year.

Impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:

(i) In the case of an individual asset, at the higher of the net selling price and the value in use;
and

(ii) In the case of a cash generating unit (a group of assets that generates identified, independent
cash flows), at the higher of the cash generating unit''s net selling price and the value in use.

The amount of value in use is determined as the present value of estimated future cash flows from the
continuing use of an asset and from its disposal at the end of its useful life. For this purpose, the discount rate
(pre-tax) is determined based on the weighted average cost of capital of the company suitably adjusted for
risks specified to the estimated cash flows of the asset.

For this purpose, a cash generating unit is ascertained as the smallest identifiable group of assets that
generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

If recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount,
such deficit is recognized immediately in the Statement of Profit and Loss as impairment loss and the carrying
amount of the asset (or cash generating unit) is reduced to its recoverable amount.

When an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined had no impairment loss is recognized for
the asset (or cash generating unit) in prior years. A reversal of an impairment loss is recognized immediately
in the Statement of Profit and Loss

G. Financial Instruments
i. Financial assets

Financial assets are recognized when the Company becomes a party to the contractual provisions of the
instrument.

All financial assets are recognized at fair value on initial recognition except trade receivables. Financial assets
are subsequently classified as measured at:

- Amortized cost

- Fair value through profit and loss (FVTPL)

- Fair value through other comprehensive income (FVTOCI)

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

Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial
asset expire, or it transfers the contractual rights to receive the cash flows from the asset.

Impairment of financial assets

The Company recognizes loss allowances for expected credit losses on:

- Financial assets measured at amortized cost;

At each reporting date, the Company assesses whether financial assets carried at amortised cost has
impaired and provisions are made for impairment accordingly. A financial asset is ''credit impaired'' when one
or more events that have a detrimental impact on the estimated future cash flows of the financial asset have
occurred.

The Company measures loss allowances at an amount equal to lifetime expected credit losses, except for the
following, which are measured as 12 month expected credit losses:

- Debt securities that are determined to have low credit risk at the reporting date; and

- Other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over
the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowances for trade receivables are always measured at an amount equal to lifetime expected credit
losses.

12-month expected credit losses are the portion of expected credit losses that result from default events
that are possible within 12 months after the reporting date (or a shorter period if the expected life of the
instrument is less than 12 months).

When determining whether the credit risk of a financial asset has increased significantly since initial
recognition and when estimating expected credit losses, the Company considers reasonable and supportable
information that is relevant and available without undue cost or effort. This includes both quantitative and
qualitative information and analysis, based on the Company''s historical experience and informed credit
assessment and including forward looking information.

Measurement of expected credit losses

Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the
present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in
accordance with the contract and the cash flows that the Company expects to receive).

Presentation of allowance for expected credit losses in the balance sheet

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount
of the assets.

Write-off

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there
is no realistic prospect of recovery. This is generally the case when the Company determines that the debtor
does not have assets or sources of income that could generate sufficient cash flows to repay the amounts
subject to the write-off.

ii. Financial liabilities

Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the
instrument. Financial liabilities are initially measured at the amortized cost unless at initial recognition, they
are classified as fair value through profit and loss.

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Financial liabilities are subsequently measured at amortized cost using the effective interest rate (EIR)
method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all
changes in fair value recognized in the Statement of Profit and Loss.

Derecognition

A financial liability is derecognized when the obligation specified in the contract is discharged, cancelled or
expires.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is
a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net
basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be
contingent on future events and must be enforceable in the normal course of business and in the event of
default, insolvency or bankruptcy of the Company or the counterparty.

G. Borrowing cost:-

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,
which are assets that necessarily take a substantial period of time to get ready for their intended use, are
added to the cost of those assets, until such time as the assets are substantially ready for their intended use.

All other borrowing costs are recognized in the Statement of Profit and Loss in the period in which they are
incurred.

The Company determines the amount of borrowing costs eligible for capitalization as the actual borrowing
costs incurred on that borrowing during the period less any interest income earned on temporary investment
of specific borrowings pending their expenditure on qualifying assets, to the extent that an entity borrows
funds specifically for the purpose of obtaining a qualifying asset. In case if the Company borrows generally
and uses the funds for obtaining a qualifying asset, borrowing costs eligible for capitalization are determined
by applying a capitalization rate to the expenditures on that asset.

The Company suspends capitalization of borrowing costs during extended periods in which it suspends active
development of a qualifying asset.

H. Income Tax

The tax expense for the period comprises current and deferred tax. Tax is recognized in Statement of Profit and
Loss, except to the extent that it relates to items recognized in the comprehensive income or in equity. Tax
expense relating to items recognized outside Statement of profit and loss is recognized outside Statement of
profit and loss. Tax are recognized in correlation to the underlying transaction either in other comprehensive
income or directly in equity.

Current tax

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet
date.

Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in
the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred
tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally
recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be
available against which those deductible temporary differences can be utilized.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset
to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which
the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.

The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying
amount of its assets and liabilities.

Deferred Tax is generally charged to profit & loss except when they relate to items which are recognized in other
comprehensive income or equity.

Deferred tax asset and deferred tax liabilities are off-set if a legally enforceable right exist to set-off current tax
asset against current tax liabilities and the deferred taxes relates to the same taxable entity and the same
taxation authority.

I. Inventories:-

Inventories are valued as under:

Raw material - At Cost or NRV whichever is lower

Stock in process - At Cost or NRV whichever is lower
Stores, spares etc. - At Cost or NRV whichever is lower
Finished Goods - At lower of Cost or Net Realizable value.

• Raw materials:-cost includes cost of purchase and other costs incurred in bringing the inventories to their
present location and condition.

• Finished goods and work in progress: - cost includes cost of direct materials and labour and a proportion of
manufacturing overheads based on the normal operating capacity, but excluding borrowing costs.

• Traded goods:-Cost includes cost of purchase and other costs incurred in bringing the inventories to their
present location and condition.

Cost is determined on first in, first out basis.

All other inventories of stores, consumables, project material at site are valued at cost. The stock of waste is
valued at net realizable value.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make the sale. Items of inventories are measured at lower
of cost and net realizable value after providing for obsolescence.

J. Cash and cash equivalent:-

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand. For the purpose of the
statement of cash flows, cash and cash equivalents consist of cash as defined above, net of outstanding bank
overdrafts as they are considered an integral part of the Company''s cash management.

K. Statement of Cash Flows

Statement of Cash Flows is prepared segregating the cash flows into operating, investing and financing activities.

Cash flow from operating activities is reported using indirect method, adjusting the profit before tax excluding
exceptional items for the effects of:

(i) changes during the period in inventories and operating receivables and payables, transactions of a non¬
cash nature;

(ii) (ii) non-cash items such as depreciation, provisions, unrealized foreign currency gains and losses; and

(iii) (iii) all other items for which the cash effects are investing or financing cash flows. Cash and cash
equivalents (including bank balances) shown in the Statement of Cash Flows exclude items which are not
available for general use as at the date of Balance Sheet.

L. Foreign currency

These financial statements are presented in Indian rupees, which is the functional currency. Transactions in
foreign currencies are recorded at the exchange rate prevailing on the date of transaction quoted by bank.

Exchange differences are recognized in the Statement of Profit and Loss except to the extent, exchange
differences which are regarded as an adjustment to interest costs on foreign currency borrowings, are capitalized
as part of borrowing costs.

M. Employees Benefit:

a) Short Term Employee Benefits

Liabilities for salaries, including non-monetary benefits that are expected to be settled wholly within 12 months
after the end of reporting period in which the employees rendered the related services are recognized in respect
of employee''s service up to the end of reporting period and are measured at the amount expected to be paid
when the liabilities are settled. These liabilities are presented as current employee benefit obligations in the
balance sheet.

b) Post-Employment Benefits

(i) Defined contribution plan

The Company''s approved provident fund scheme and employees'' state insurance fund scheme are defined
contribution plans. The Company has no obligation, other than the contribution paid/payable under such
schemes. The contribution paid/payable under the schemes is recognized during the period in which the
employee renders the related service.

(ii) Defined benefit plan

Gratuity and Leave Encashment are recognized as an expense at the un-discounted amount in the profit and loss
account of the year in which related service is rendered. The company has not made any actuarial valuation in
this regard.

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Mar 31, 2015

1. Method of Accounting

The accounts has been proposed as per historical cost convention and an accrual basis Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principles followed by the company.

2. Fixed Assets

a) Fixed assets are stated at their original cost (net of CENVAT) including incidental expenditure related to acquisition and installation on less accumulated depreciation.

b) Capital section under erection/ installation in the balance sheet as capital work-in-progress.

3. Depreciation

a. Depreciation is provided on straight line method based on useful lives of assets as prescribed under the transactional provisions of schedule II of companies Act, 2013on pro-rata basis. As the schedule II comes into affect from 1st April 2014. the carrying amount of the assets as on the date have been depreciated over the remaining useful life of the assets after retaining the residual value as prescribed by the relevant schedule reassessment of useful life of certain assets. where ever one. is based on the external mechanical advises taken by the company.

b. Company have a policy to fully depreciate assets up to Rs. 5000/- in the year of acquisition. Hence the assets closing less than Rs.5000/- have been fully depreciate in the year of acquisition.

4. Investment.

Investments are stated at cost.

5. Revenue Recognition / Basis of accounting

The company follows the accrual system of accounting except certain items like interest, rebase, discounts &claims on sales insurance claim at care audited as and when there is reasonably certainty.

6. inventories

Inventories are valued as under.

Finished Goods : At cost or market realizable value, whichever is lower

Work in Progress : At Cost inclusive of allocate overheads

Dyes & Chemical, Stores £ Spares etc : At lower of cost or net realizable value.

7. Job Processing Income

Job Processing Income is stated at net of discount

8. Retirement Benefits

Company's contribution accruing during the year in respect of Provident Fund and Employee State Insurance Scheme ha been charged to Profit & Loss Account.

Encashment of leave is accounted on Accrual Basis

"Liability in respect of employees' gratuity is valued on actuarial basis made by the Life Insurance Corporation of India under employees group gratuity scheme. Any shortfall or excess based on such valuation is accounted for.

9. Borrowing Costs

Borrowing cost that are attributable to the acquisition Or construction of the qualifying assets are capitalized as part of the cost of such assets. A qualifying assets is one that necessarily take substance of period of time to get ready for intended use all other borrowing costs arc charged to revenue.

10. Segment Reporting

The company's main operation relates to the man processing of man made fabrics and unit i.e. process house which is located at Dhilwara (Raj) and most of the customers are local. Hence the company does not have any other segment it disclose separately.

11. Related Party

Related party transactions as required under A3- T9 issued by the ICA! are disclosed by way of notes to the accounts.

12. Earning Per Share (EPS)

EPS is calculated as per AS 20 issued by the Institute Of Chartered Accountants Of India,

13. Deferred tax

Provision for current tax is made after taking into consideration admissible benefit under the provision of the income ta Act, 1961. Differed ax resulting from timing differences between book profit and taxable profits is accounted for using the laws and rates that have been or substantively enacted as on the Balance-Sheet date Deferred tax asset is recognized and named forward to the extant there is a reasonable certainty that the assets will be realized in future.

14. Impairment of Assets

Factored giving rise to any indication of any impairment of the carrying amount of the company's assets are appraised at each of Ss determine and provide/revert an impairment loss following accounting standard AS-28 for impairment

15 Contingent Liabilities

Contingent Liabilities disposed by way of notes

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Mar 31, 2014

1. Method of Accounting

The accounts have been prepared as per historical cost convention and on an accrual basis. Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principles followed by the company.

2. Fixed Assets

a) Fixed assets are stated at their original cost (net of CENVAT) including incidental expenditure related to acquisition and Installation less accumulated depreciation.

b) Capital assets under erection / installation are reflected in the balance sheet as capita] work-in-progress.

3. Depreciation

Depreciation has been calculated on plant and machinery as continuous process plant (as per technical opinion obtained by the management) by applying written down value rates prescribed in Section 123(2) and Schedule II to the companies act, 2013. Depreciation on all other fixed assets including miscellaneous plant & machinery has been provided under straight line method at the rate prescribed as per Part "C" of schedule II of the companies act 2013.

Depreciation on fixed assets acquired during the year has been calculated on pro-rata basis with reference to the date on which the assets are put to use.

Depreciation on assets where actual cost does not exceed Five Thousand Rupees, being provided at the rate of Hundred percent in the year of acquisition.

4. Investment.

Investments are stated at cost.

5. Revenue Recognition / Basis of accounting

The company follows the accrual system of accounting except certain items like interest, rebates, discounts & claims on sales, insurance claims etc are admitted as and when there is reasonable certainty.

6. Inventories

Inventories are valued as under.

Finished Goods : At Cost or market realizable value, whichever is lower.

Work in Progress : At Cost inclusive of allocable overheads

Dyes & Chemical, Stores & Spares etc : At lower of cost or net realizable value.

7. Job Processing Income

Job Processing Income is stated at net of discount.

8. Retirement Benefits

Company's contribution accruing during the year in respect of Provident Fund and Employee State Insurance Scheme has been charged to Profit & Loss Account.

Encashment of leave is accounted on Accrual Basis

Liability in respect of employees gratuity is valued on actuarial basis made by the Life Insurance Corporation of India under employees' group gratuity scheme. Any shortfall or excess based on such valuation is accounted for.

9. Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of the qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

10. Segment Reporting

The company's main operation relates to the processing of man made fabrics and has only one unit i.e. process house which is located at Bhilwara (Raj) and most of the customers are local. Hence the company does not have any other segment to disclose separately.

11. Related Party

Related party transactions as required under AS- 18 issued by the ICAI are disclosed by way of notes to the accounts.

12. Earnings Per Share (EPS)

EPS is calculated as per AS-20 issued by the Institute Of Chartered Accountants Of India.

13. Deferred tax

Provision for current tax is made after taking into consideration admissible benefits under the provisions of the Income Tax Act, 1961. Deferred tax resulting from timing difference between book profits and taxable profits is accounted for using the tax laws and rates that have been or substantively enacted as on the Balance-Sheet date. Deferred tax asset is recognized and carried forward to the extent there is a reasonable certainty that the assets will be realized in future.

14. Impairment of Assets

Factors giving rise to any indication of any impairment of the carrying amount of the company's assets are appraised at each balance sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

15. Contingent Liabilities.

Contingent Liabilities disclosed by way of notes.

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Mar 31, 2013

1. Method of Accounting

The accounts have been prepared as per historical cost convention and on an accrual basis. Accounting policies not specifically referred to otherwise be consistent and in consonance with generally accepted accounting principles followed by the company.

2. Fixed Assets

a) Fixed assets are stated at their original cost (net of CEN VAT) including incidental expenditure related to acquisition and Installation less accumulated depreciation.

b) Capital assets under erection /installation are reflected in the balance sheet as capital work-in-progress.

3. Depreciation

Depreciation has been calculated on plant and machinery as continuous process plant (as per technical opinion obtained by the management) by applying written down value rates prescribed in schedule XW to the companies act, 1956. Depreciation on all other fixed assets including miscellaneous plant & machinery has been provided under straight line method at the rate prescribed as per schedule XIV to the companies act. Depreciation on fixed assets acquired during the year has been calculated on pro-rate basis with reference to the date on which the assets are put to use.

Depreciation on assets where actual cost does not exceed Five Thousand Rupees, being provided at the rate of Hundred percent in the year of acquisition.

4. Investment.

Investments are stated at cost.

5. Revenue Recognition / Basis of accounting

The company follows the accrual system of accounting except certain items like interest, rebates, discounts & claims on sales, insurance claims etc are admitted as and when there is reasonable certainty.

6. Inventories

Inventories are valued as under.

Finished Goods : At Cost or market realizable value, whichever is lower.

Work in Progress : At Cost inclusive of also cable over treads

Dyes & Chemical, Stores & Spares etc : At lower of cost or net realisable value.

7. Job Processing Income

Job Processing Income is stated at net of discount

8. Retirement Benefits

Company's contribution accruing during the year in respect of Provident Fund and Employee State Insurance Scheme has been charged to Profit & losses Account.

Encashment of leave is accounted on Accrual Basis

Liability in respect of employees gratuity is valued on actuarial basis made by the Little Insurance Corporation of India under employees' group gratuity scheme. Any shortfall or excess based on such valuation is accounted far.

9. Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of the qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of lime to get ready for intended use. All other borrowing costs are charged to revenue.

10. Segment Reporting

The company's main operation relates to the processing of man made fabrics and has only one unit i.e. process house which is located at Bhilwara (Raj) and most of the customers are local. Hence the company does not have any other segment to disclose separately.

11. Related Party

Related party transactions as required under AS-16 issued by the ICAI are disclosed by way of notes to the accounts.

12. Earning Per Share (EPS)

EPS is calculated as per AS-20 issued by the Institute Of Chartered Accountants Of India

13. Deferred tax

Provision for current tax is made after taking into consideration admissible benefits under the provisions of the Income Tax Act, 1S61, Deferred tax resulting from liming difference between book profits and taxable profits is accounted for using the tax laws and rates that have been or substantively enacted as on the Balance Sheet date. Deferred tax asset is recognised and carried forward to the extent there is a reasonable certainty that the assets will be realised in future.

14. Impairment of Assets

Factors giving rise to any indication of any impairment of the carrying amount of the company's assets are appraised at each balance sheet date to determine and provide/revert an impairment loss following accounting standard AS-2S for impairment of assets.

15. Contingent Liabilities.

Contingent Liabilities disclosed by way of notes.