1. ACCOUNTING CONVENTIONS
The Company generally follows the mercantile system of accounting and
recognizes income and expenditure on accrual basis except those
significant uncertainties, warehousing charges and leave pay.
2. FIXED ASSETS
Fixed assets stated at cost which include all related expenses up to
acquisition and installation of fixed assets. The fixed assets have
been revalued on 31.3.2008.
Depreciation on fixed assets has been provided on pro-rata basis on
straight line method at the rates prescribed in Schedule XIV of the
Companies Act, 1956. No depreciation is provided on the assets not put
4. INVENTORIES VALUATION
Items of inventories are valued as under:
a. Raw materials : At Cost. On first in first out basis (Including
materials with third party)
b. Works in Process : At estimated cost
c. Finished Goods : At estimated cost
d. Stores & Spares : At Cost
e. Scraps : At estimated cost
5. FOREIGN CURRENCY TRANSACTIONS
a. Transaction in foreign currencies, are recorded at exchange rate
prevailing on the date of relevant transaction.
b. Balance in form of Current assets and Current liabilities in
foreign currency, outstanding at the close of the year, are converted
into Indian currency at the appropriate exchange rates prevailing in
the date of Balance Sheet.
c. Resultant gain or loss with respect to (a) above is accounted
during the year.
6. RETIREMENT BENEFITS
Retirement benefits payable to the employees have been accounted for by
making a provision, as regards to Gratuity payable to Employees based
on actual valuation. This is in harmony with AS - 15 issued by the
Institute of Chartered Accountants of India, which came into force from
7. MISCELLANEOUS EXPENDITURE
i. Preliminary Expenses & Public issue expenses are amortized over a
period often years.
8. REVENUE RECOGNITION
i. Sales are recognized at the time of the dispatch of the goods.
Sales are exclusive of excise duty and net of return.
ii. Income arising out of lease rent is accounted for as per the terms
of the lease agreements entered into with the Lessees.
9 IMPAIRMENT OF ASSETS
The company has not worked out any Impairment of Assets as per
10 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
(i) The company recognizes as provisions, the liabilities being present
obligations arising out of past events, the settlement of which is
expected to result in an outflow of resources and which can be measured
only by using a substantial degree of eliminations.
(ii) Contingent liabilities are disclosed by way of a note to the
financial statement after careful evaluation by the management of the
facts and legal aspects of the matter involved.
(iii) Contingent assets are neither recognized nor disclosed.
11, a) Current Tax: Provision for current tax is made on the estimated
taxable income at the rate applicable to relevant assessment year.
b) Deferred Tax: In accordance with the accounting standard 22
Accounting for Taxes on the Income issued by the Institute of
Chartered Accountants of India, the deferred tax for the timing
difference is measured using the tax rates and tax law that have been
enacted or substantially enacted by the Balance Sheet date. Deferred
tax asset arising from timing difference are recognized only on the
consideration of prudence.