(A) Basis of Preparation of financial statement
The financial statements have been prepared under the historical cost
convention on an accrual basis and comply in all material respects with
the mandatory accounting standards and the relevant provisions of the
Companies Act, 1956.
Long term investments are stated at cost. Provision for diminution in
the value of investments is made only if such decline is other than
temporary in the opinion of the management.
(C) Other Income
Dividend is accounted for as and when received.
(D) Foreign Currency Transaction
Transactions in foreign exchange, other than those covered by forward
exchange contracts are accounted at the rates prevailing on the date of
transaction. All monetary assets and liabilities denominated in foreign
currency are restated at the rate prevailing at the year end. Ail other
exchange differences are accounted for in the Statement of Profit &
Loss except in case of transactions covered by forward exchange
contracts where exchange difference is recognized over the life of the
Lease rentals in respect of assets acquired under operating leases are
charged off to the Statement of Profit & Loss as incurred. Lease
rentals in respect of assets given under operating leases are credited
to the Statement of Profit & Loss,
(F) Accounting Policy Provision for Current Tax
Provision for Income tax is made on the basis of the estimated taxable
income for the current accounting period in accordance with the Income-
tax Act, 1961.
(G) Impairment of Assets
The Company assesses at each balance sheet date whether there is any
indication that an asset may be impaired. If any such indication
exists, the management estimates the recoverable amount of the asset.
If such recoverable amount of the asset or the recoverable amount of
the cash generating unit to which the assets belongs is less than its
carrying amount, the carrying amount is reduced to its recoverable
amount. The reduction is treated as an impairment loss and is
recognized in the statement of profit and loss. If at the balance sheet
date there is an indication that if a previously assessed impairment
loss no longer exists, the recoverable amount is reassessed , and the
asset is reflected at the recoverable amount subject to a maximum of
depreciated historical cost.
(H) Provision & Contingent Liability
The Company creates a provision when there is a present obligation as a
result of a past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of the obligation. A
disclosure for a contingent liability is made when there is a possible
obligation or a present obligation that may, but probably will not,
require an outflow of resources. Where there is a possible obligation
or a present obligation in respect of which the likelihood of outflow
of resources is remote, no provision or disclosure is made.