(i) Basis of Preparation o financial statements :
The financial statements have been prepared under the historical cost
convention in accordance with the normally accepted accounting
principles and the provisions of the Companies Act, 1956.
(ii) Accounting policies not specifically referred to otherwise or
consistent and in consonance with the generally accepted accounting
(iii) Foreign Currency Translations :
(a) Current Assets and Current Liabilities in foreign currencies at the
year end and not contracted are translated at year end rate and those
covered by contracts are translated at the contracted rate.
Gains or Losses on cancellation of Forward exchange contracts are
recognised separately and on the date of cancellation.
(b) Any Income or Expense on account of Exchange difference either on
settlement or on transactions recognised in the Profit and Loss account
except in respect of the acquisition of Fixed Assets which are adjusted
to the carrying cost of such Assets.
(iv) Fixed assets and depreciation :
(a) Fixed assets are stated at the cost of acquisition less accumulated
(b) Depreciation is provided on written down value basis in the manner
and at the rates specified in Schedule XIV to the Companies Act, 1956.
Premium on lease hold land is amortised over the period of the lease.
(v) Inventories :
Basis of Valuation
(a) Inventories are valued at lower of cost and net estimated
(b) Cost Formulae Used :
i) Stores : F.I.F.O.
ii. Raw Materials : F.I.F.O. or Specific identification
iii. Stock-in Process : Material cost plus direct labour
and other overheads and Finished
(vi) Retirement Benefits :
Gratuity and Leave Salary is provided for on the basis of actuarial