The accounts are prepared under the historical cost convention and in
accordance with the applicable accounting standards issued by The
Institute of Chartered Accountants of India. The significant accounting
policies are as follows :
1. Fixed Assets :
Fixed Assets are valued at cost.
2. Depreciation :
Depreciation has been provided on straight line method on building,
plant & machinery, electric installations and on written down value
method on other assets, as per Schedule XIV of the Companies Act, 1956.
Further, depreciation on assets, whose actual cost does not exceed Rs.
5000/- has been provided @ 100%. Further, Leasehold Land is being
amortized taking into account the residual life of lease.
3. Impairment of Assets :
Consideration is given at each balance sheet date to determine whether
there is any modification or impairment of the carrying amount of the
fixed assets. If any condition exists, an asset''s recoverable amount
is estimated. An impairment loss is recognized, whenever the carrying
amount of any asset exceeds recoverable amount.
4. Valuation of Inventory :
The raw materials, stores and spares and goods-in-process are valued at
cost net of Cenvat credit, and finished goods are valued at cost or net
realizable value, whichever is lower. The cost is computed on FIFO
basis and comprises all cost of purchase, cost of conversion and other
costs incurred in bringing the inventories to their present location
5. Research & Development :
The Company does not have separate research & development department.
The Company has not made any specific expenditure on this head.
6. Foreign Currency Transactions :
(a) Current assets and current liabilities relating to foreign currency
transactions are normally recorded at the exchange rate prevailing at
the time of transaction and Profit or Loss on outstanding foreign
currency contracts has been accounted for at the exchange rate
prevailing at the close of the year.
(b) The Company has opted for accounting the exchange differences
arising on reporting of long term foreign currency monetary items in
line with Companies (Accounting Standards) Amendment Rules, 2011
relating to Accounting Standards 11 Accordingly, the effect of (AS-11)
notified by Government of India on 11th May, 2011. Exchange differences
on foreign currency loans of the company is accounted by transfer to
''Foreign Currency Monetary Items Translation Difference Account'' to
be amortised over the balance period of the long term monetary items or
period upto 31st March, 2012, whichever is earlier.
7. Investments :
All investments are valued at cost price.
8. Recognition of Income / Expenditure:
All revenues / income are accounted for on accrual basis.
9. Borrowing Cost :
Borrowing cost directly attributable to the acquisition, construction
or production of a fixed assets has been capitalized as part of the
cost of that asset. Funds borrowed generally and used for the purpose
of obtaining of fixed assets, the amount of borrowing cost eligible for
capitalization has been determined by applying capitalization ratio to
the total cost incurred on fixed assets.