Sales are exclusive of Excise Duties and Sales-Tax.
The Company has provided depreciation on all fixed assets acquired till
31-12-1980 on the Written Down Value method and on assets added
thereafter on the Straight Line Method at the rates specified in Schedule XIV to the Companies Act, 1956.
C. Fixed Assets
Fixed Assets are stated at cost of acquisition or construction less
depreciation except for certain land and Buildings which have been
valued at depreciated replacement value as stated in Note 6. All costs
relating to the acquisition, net of Modvat Benefit, and installation of
fixed assets are capitalised and include all costs prior to the
commencement of production. In respect of assets sold, where the cost
can not be ascertained, sales proceeds are considered to be the original cost.
D. Foreign Currency Transactions
(i) The current assets of the London Office as at the end of the year
have been translated at closing rate. Fixed assets have been translated at the exchange rate on the date of
transaction. Revenue items have been translated at average rate.
(ii) Monetary assets and liabilities related to foreign currency
transactions remaining unsettled at the end of the year are translated
at the year end rates. The difference in translation of monetary assets and liabilities and realised gains
and losses on foreign exchange transactions other than those relating to fixed assets are recognised under
respective heads in the Profit and Loss Account. In respect of transactions covered by foreign exchange
contracts, the difference between contract rate and spot rate on the date of transaction is charged under the
respective head to the Profit and Loss Account over the period of the contract.
(i) Investments in foreign currency in Shares of foreign joint venture
company is translated at the rate prevailing on the transaction date.
(ii) Investments are stated at cost of acquisition. As the same are
intended to be held for a long period, temporary diminution in the
value of quoted shares is not recognised. In case of unquoted shares
where diminution is not temporary, the same is fully provided for.
(i) Inventories of Raw Materials are valued at monthly weighted average
cost or net realisable value, whichever is lower. Finished goods and
Stock-in-process are valued at lower of cost or net realisable value.
Landed cost of Raw Materials and Stores is net of the credit, if any,
for Excise Duty paid thereon. The amount of any Customs Duty payable
on Raw Materials and Excise Duty payable on finished goods is not
included in the value of the goods untill it is paid.
(ii) Stock of Developed Property and Property development work-in-progress represents cost of land,
construction and development
G. Export Incentives
Export incentives are accounted for on accrual basis.
H. Property Development
The Company follows completed contract method of accounting in respect
of property development. Under this method the profit in respect of
units sold will be recognised only when the work in respect of relevant
units are completed.
Interest on delayed payments is accounted on accrual thereof.
J. Research and Development
Research and Development expenses which are revenue in nature are charged off in the year in which they are
incurred. Capital Expenditure is included in Fixed Assets under appropriate heads.
K. Retirement Benefits
(i) Liability is provided and funded for retirement benefits of
Provident Fund, Superannuation Fund and Gratuity in respect of all
eligible employees of the Company. The Gratuity liability is evaluated
on the basis of an actuarial valuation.
(ii) The Company extends the benefit of encashment of leave to its
employees while in service as well as on retirement. As the Company
does not have any defined retirement benefit scheme in this respect,
Accounting Standard AS 15 issued by the Institute of Chartered Accountants of India is not considered
Encashment of leave accumulated while in service is at the option of
the employee and is accounted for as and when claimed hence not provided for.
L. Miscellaneous Expenditure
Cost of Early Retirement Scheme is charged on payment basis.