16. SIGNIFICANT ACCOUNTING POLICIES :
16.01 Fixed assets :
Fixed assets are stated at cost except in case of certain items of
Land, Buildings and Plant and Machinery which are stated on the basis
of revaluation (with corresponding credit to the Revaluation Reserve
Account), being inclusive of resultant write ups. Cost of fixed assets
includes purchase price and directly attributable costs of bringing the
assets to working condition for the intended use.
16.02 Depreciation :
Depreciation is calculated in the following manner :
(i) Depreciation on revalued assets other than Land is calculated on
their respective revalued amounts at rates considered applicable by the
valuers on the Straight Line Method for Plant and Machinery and Written
Down Value method for Buildings. (Also refer note 7 above).
(ii) In respect of other assets, at rates prescribed in Schedule XIV to
the Companies Act, 1956 :
On Straight Line Method for Plant and Machinery. On Written down Value
Method for assets other than Plant and Machinery.
16.03 Investments (Long Term) :
Investments are stated at cost less any provision for permanent
diminution in value.
16.04 Inventories :
Inventories of finished goods are valued at lower of cost (inclusive of
appropriate share of overheads) and net realisable value. Raw materials
(including materials under Work-in-Process) and Stores and spares
(other than spares for specific machinery) are valued at weighted
average cost. Spares for specific machinery are valued at or under cost
and are amortised over the useful lives of the related machinery as
estimated by the management.
16.05 Retirement benefits :
Contribution to gratuity fund is made on a yearly basis under the
Group Gratuity Scheme of Life Insurance Corporation of India. Accrued
liability towards leave encashment benefits payable to employees is
evaluated on the basis of management estimate.
16.06 Revenue recognition :
Income and expenditure are recognised on accrual basis.
16.07 Sales :
Sales are net of discount, rebate and sales tax.
16.08 Contingencies :
Contingencies which can be reasonably ascertained are provided for, if
in the opinion of the Company there is a probability that the future
outcome may be materially detrimental to the interest of the Company.
16.09 Foreign currency transactions :
Transactions in foreign currencies are accounted for at exchange rates
prevailing at the time the transactions take place. Year-end balances
of short term foreign currency working capital loan and other
liabilities/receivables are translated at the applicable forward
contract or year-end rates and the resultant gains/losses are
appropriately recognised as income/revenue charges for the year/over
the period of contract in case of forward contracts or adjusted against
cost of related items of fixed assets.
16.10 Taxation :
Income tax expense comprises Current Tax and Deferred Tax charge.
Deferred Tax is recognised on timing differences, being the difference
between taxable income and accounting income that originate in one
period and are capable of reversal in one or more subsequent periods.
Deferred Tax Assets are recognised only if there is a reasonable
certainty that sufficient future taxable income will be available
against which such Deferred Tax Assets will be realised. Such assets
are reviewed as at each balance sheet date to re-assess realisibility
16.11 Miscellaneous Expenditure :
Miscellaneous expenditure not written off is amortised over a period
having due regard to its nature and benefit derived therefrom.
17. Figures of the previous year have been re-arranged/re-grouped