a) The financial statements are prepared under the historical cost
convention. These statements have been prepared in accordance with
applicable mandatory accounting standards and relevant presentation
requirements of the companies Act, 1956.
b) Fixed assets are stated at cost less accumulated depreciation. Cost
of acquisition or construction is exclusive of modvat under central
excise availed by the company on account of purchases and is inclusive
of freight, duties, taxes and incidental expenses and interest on loans
attributable to the acquisition of the assets upto the date of
commissioning of the assets. No write-off is being made in respect of
leasehold land as the lease is a long base.
c) Inventories of raw materials, stock-in-process, stores, packing
materials, spares and loose tools are valued at cost inclusive of
excise and inventories of finished goods are valued at lower of cost or
d) Sales are recognised at the time of despatch of goods. Other income
and interest are accounted on accrual basis.
e) The company has the Provident fund scheme for all eligible
employees. The contributions to the same are charges to revenue each
f) Liabilities in respect of gratuity are provided on the basis of the
Payment of Gratuity Act.
g) Provision is made for value of unutilised leave due to employees at
the end of the year.
h) Depreciation is provided on straight line method at the Rates as
specified in schedule XIV to the companies Act, 1956.
i) Preliminary expenses and Public issue expenses are being written off
over a period of ten years equally.
During the year the company has introduced two new products the
deferred revenue expenditure related to the technical plants has been
amortised over a period of five years in accordance with the provisions
of section 35D of the Income Tax Act, 1961.
j) The Government grants are recognised only on the assurance that the
same will be received. State Investment Subsidy from State Government
are treated as Capital receipts and shown under Reserve and Surplus
under Capital Reserves.
k) Transactions in foreign currencies are recorded at the exchange
rates prevailing on the date of the transaction.