i) Basis of Accounting
 
 The Company adoptes accrual basis in the preparation of accounts.
 
 ii) Recognition on Incomes/Expenses
 
 Sales of Sulphuric Acid and Fertilizers are accounted for on their
 despatch to customers.  Income from interest and subsidy received are
 accounted for on accrual basis. Insurance claims are accounted for on
 cash basis.
 
 The Company provides for all known expenses except medical
 reimbursement and leave encashment. Which are accounted on actual
 payment basis.
 
 iii) Fixed Assets and depreciation
 
 Fixed assets are stated at cost less accumulated depreciation. Cost of
 acquisition on construction is inclusive of all the related expenses.
 The Buildings and Plant & Machinery are stated at the value as
 determined in the Revaluation Report as at 30th September, 1992.
 
 No Depreciation on Factory Building & Plant & Machinery has been
 charged as the same has not been put to use during the year under
 audit. Depreciation on Non Factory Building, Furniture & Fixture,
 Vehicle and other. Fixed Assets has been provided on the Straight Line
 Method, on Single Shift Basis at the rates and in the manner specified
 in schedule XIV of the Companies Act, 1956 as amended up to date.
 
 The Depreciation on the increased value of Non Factory Building due to
 revaluation done on 30th September, 1992 has been reduced from
 Revaluation Reserve.
 
 iv) Inventories
 
 Raw Material are valued at cost. There are no finished goods and the
 disclosure of method of Valuation does not arise.
 
 v) Miscellaneous Expenditure
 
 Capital issue Expenses are written off equally over a period of ten
 years.