The Financial Statements have been prepared on the historical cost
convention and in accordance with normally accepted accounting
(i) Fixed Assets and Depreciation
Fixed Assets are capitalised at acquisition cost, including directly
attributable cost of bringing the assets to its working condition for
the intended use.
Depreciation on Fixed Assets has been charged under straight line
method at the rates prescribed under Schedule XIV to the Companies Act,
1956 and in respect of additions/ deductions made during the year/
period, depreciation is charged on pro-rata basis from the month of
addition / upto the date of sale.
Stock-in-trade is valued at lower of cost or net realisable value and
other items of inventories are valued at cost. Cost includes all direct
costs and other applicable manufacturing overheads and in ascertaining
the cost, FIFO method is adopted.
(iii) Revenue Recognition:
(a) Revenue in respect of sale of products is recognised at the point
of despatch to customers. Sales which represent invoiced value of goods
include excise duty and are net of sales tax, returns and inter-branch
transfers. Export sales are accounted at the prevailing rate of
exchange as on the date of invoicing. The difference in the rate of
exchange, if any, is accounted at the time of realisation.
(b) Revenue in respect of Export incentives I benefits is recognized as
and when these incomes are ascertained and quantified.
(iv) Retirement Benefits:
(a) Provision for gratuity to staff has been made on actuarial basis.
(b) Contribution to Provident Fund and ESI Fund are accounted at the
applicable rates on accrual basis.
(c) Accrued liability for encashment of leave to employees is accounted
on calendar year basis, in accordance with the Company Rules.
(v) Excise Duty:
CENVAT credit for Excise Duty on inputs and other capital goods is
accounted fully and to the extent the sum availed off is adjusted
towards payment of excise duty on dispatches leaving the unutilised
balance being carried forward to subsequent year and kept in Advances
recoverable in cash or in kind orvalueto be received.
(vi) Tax on Income
Not to recognize deferred tax assets on unabsorbed depreciation and
carry forward of losses unless there is virtual certainty that there
will be sufficient future taxable income available to realize such