Unless otherwise stated hereunder the financial accounts have been
drawn up on Historical Cost Convention generally following accrual
basis of accounting.
2. FIXED ASSETS:
Fixed Assets are recorded at cost of acquisition/construction.
Depreciation on Fixed Assets has been provided on Straight Line Method
in accordance with the rates prescribed in Schedule XIV of the
Companies Act, 1956 as amended by the Notification GSR 756 (E) dated
16.12.93 issued by the department of Company Affairs.
Investments are recorded at cost.
Inventories are valued on the basis given below:
(a) Raw Material - At Cost.
(b) Semi Finished Goods - At Direct Cost i.e. Raw Materials and
Conversion Cost, except those purchased directly which are valued at
(c) Finished Goods-At Absorption Cost.
(d) Packing Materials - At Cost. «. EMPLOYEE BENEFIT SCHEMES:
(a) Provident Fund- Eligible employees of the Company receive benefits
under the Provident Fund which is a defined contribution plan, where
both the employee and the Company make monthly contributions equal to
specified percentage of the covered employee''s salary. These
contributions are made to the funds administered and managed by the
Government. The Company''s monthly contributions are charged to revenue
in the period they are incurred.
(b) Gratuity - In accordance with the Payment of Gratuity Act 1972, the
Company provides for gratuity a defined retirement benefit plan (the
Gratuity Plan) covering eligible employees. Liabilities with regards
to such Gratuity Plan are determined by actuarial valuation and the
excess of actuarial valuation over the fund available as corpus under
Company''s LIC Group Gratuity Policy is provided and charged to revenue
in the period along with the contribution made to the said policy. The
actuarial assumptions in arriving at the provision of gratuity
liability as at the year end amounting to Rs.2,04,164 are as follows;
i) Discount Rate (p.a.) 8%
ii) Salary escalation rate 4%
iii) Retirement age 60 Years.
(c) Provision for unutilized Leave- The accrual for unutilized leave is
determined for the entire available leave balance standing to the
credit of the employees at the year end and charged to the revenue in
7. FOREIGN CURRENCY TRANSACTIONS:
Transactions in Foreign Currency are accounted at the exchange rate
prevailing on the date of the transaction. Year end balances of the
foreign currency transactions are translated at the year end rate and
the corresponding effect is given in the respective account.
8. EXCISE DUTY:
(a) Excise duty is charged to Profit and Loss Account in the year of
clearance of goods.
(b) CENVAT credits on materials purchased for production are taken into
account at the time of purchase and cenvat credits on purchase of
capital items wherever applicable are taken into account as and when
the assets are installed to the credit of respective purchase and asset
accounts. The Cenvat credits so taken are utilised for payment of
excise duty on goods manufactured. The unutilised Cenvat credit is
carried forward in the books.
9. EARNING PER SHARE:
In determining earnings per share, the Company considers the net
profit/(loss) after tax for the year attributable to equity
shareholders. The number of shares used in computing basic earnings per
share is the weighted average number of shares outstanding during the
year. The number of shares used in computing diluted earnings per share
comprises the weighted average shares considered for deriving basic
earnings per share, and also the weighted average number of equity
shares which could have been issued on the conversion of all dilutive
potential equity shares.