s1. The Company has been consistently following the accrual method in
 accounting its income and expenses.  The same procedure is followed
 this year also except that in the matter of accounting of export
 incentives, and gratuity on case basis.  The accounting is on the basis
 of a going concern concept only.
 
 2. There is no Research and Development activity by the Company and the
 allocation of amounts of the cost specifically attributable to Research
 and Development does not arise.
 
 3. Revenue from sale transactions is recognised as and when the
 property in the goods sold is transferred to the buyer for a definite
 consideration.  Revenue from service transactions and other sources is
 recognised on the completion of the contract and there is no
 uncertainty regarding the amount of consideration or collectibility.
 
 4. (a) Sales as reported is exclusive of excise duty, sales tax,
 insurance and transport charges.
 
 (b) Export Sales are accounted for at the rate prevailing on the date
 which transaction takes place.  Gain or Loss arising out of exchange
 rate fluctuations is recognished and accounted for on the date of
 realisation.
 
 5. The cost of fixed assets are stated at cost including relevant
 direct expenses and less depreciation.  Interest on amount spent on
 projects upto the date of commencement is added to the cost of fixed
 assets.
 
 6. a) Depreciation has been calculated at the rate specified in
 Schedule XIV of the said act as amended by the Circular No. 14 Dt.
 16.12.1993 by the Department of Company Affairs on straight line method
 for all assets.
 
 For machinery and electric machinery, depreciation has been provided at
 the rate applicable to a continuous process plant as per Schedule XIV
 of the Companies Act, 1956.
 
 b) In respect of all assets purchased or sold during the year
 depreciation has been provided at the above rates on prorata basis from
 the date of purchase including all assets even if the cost is below
 Rs.5,000/- or till the date of sale as the case may be.
 
 7) Inventories : Stock of stores valued at weighted average cost, FIFO.
 Raw material mixing and process and finished goods valued at cost or
 net realisable value which ever is lower and waste at residual Price.
 
 8) The value of modvat benefit eligible has been reduced from the value
 of materials and the consumption of materials has been arrived
 accordingly and the value of modvat benefit eligible in respect of
 capital item is being reduced from the value of capital goods.
 
 9) Investments are shown at cost less permanent diminution in value.
 Interest Received on investments and dividend will be accounted in
 receipt basis.
 
 10) It is the policy of the Company to amortise expenditure incurred on
 sales promotion and financial charges etc., for a period of over 10
 years.