A. FINANCIAL STATEMENTS
The financial statements are prepared under historical cost convention
on accrual basis as a going concern and in accordance with the
generally accepted accounting principles (GAAP), the Companies Act,
1956 and in compliance with Companies (Accounting Standard) Rules,
2006, (as amended) as notified u/s 211 (3C) of Companies Act, 1956
except those with significant uncertainty. Accounting policies not
stated explicitly otherwise are consistent with generally accepted
B. USE OF ESTIMATES
The preparation of financial statements in conformity with Indian GAAP
requires management to make estimates and assumptions that affect the
balances of assets and liabilities and disclosures relating to
contingent liabilities as at the balance sheet date and amounts of
income and expenses during the year. Examples of such estimates include
income taxes and future obligation under employee retirement benefit
plans. Actual results could differ from those estimated. The effects of
adjustment arising from revisions made to the estimates are included in
the statement of profit and loss of the year in which such revisions
C. CURRENT AND NON CURRENT
All the assets and liabilities have been classified as current and
non-current as per Company''s normal operating cycle and other criteria
set out in the revised Schedule VI to the Companies Act, 1956.
D. REVENUE RECOGNITION
a) Revenue from sale of goods is recognised on transfer of all
significant risks and rewards of ownership to the buyer.
b) Revenue from services are recognised on rendering of services to
customers except otherwise stated.
OTHER INCOME :
c) Rental income (exclusive of Service Tax) from assets given on
operating lease is recognised using straight line method. Contingent
rent is recognised as income to reflect systematic allocation of
earnings over the lease period. This policy is not applicable for
variable rental income based on turnover of the tenant.
d) Interest income is recognised on time proportion basis taking into
account the amount outstanding and the rate applicable.
e) Dividend income is recognised when the right to receive is
E. FIXED ASSETS
i) Tangible assets, including those given on operating lease, are
stated at cost of acquisition inclusive of freight incurred, duties and
taxes (net of CENVAT/ sales tax) and incidental expenses less
ii) Capital work in progress, cost incurred on construction of fixed
assets consists of all directly attributable expenditure.
Depreciation is provided on fixed assets including those given on
operating lease on written down value method at the rates and in the
manner specified in Schedule - XIV of the Companies Act, 1956.
Depreciation on reduced amount of fixed assets is net of depreciation
on that compensation amount excess charged in earlier years.
All investments are bifurcated into non current investments and current
investments. Investments that are readily realizable and intended to be
held for not more than a year from the date of balance sheet are
classified as current investments. All other investments are classified
as non current. Current investments are carried at lower of cost or
fair market value, determined on an individual investment basis. Non
current investments are carried at cost. Provision for diminution in
the value of non current investments is made, only if such a diminution
is other than temporary.
a) Raw materials: At lower of weighted average cost or net realisable
b) Work in progress: At lower of cost or net realisable value.
c) Finished goods and Stock in trade: At lower of cost or net
d) Stores and spares, packing and printing materials: At lower of
weighted average cost or net realizable value.
I. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, demand deposits with
banks, other short-term highly liquid investments with original
maturities of three months or less as per the AS - 3 CASH FLOW
J. FOREIGN CURRENCY TRANSACTION
Transactions denominated in foreign currencies are recorded at the
exchange rate prevailing at the date of the transactions or that
approximates the actual rate at the date of transactions.
Exchange differences arising on foreign exchange transactions settled
during the year are recognised in the statement of profit and loss for
Transactions which remains unsettled at the reporting date are reported
at the rates prevailing as on reporting date and any exchange gain /
loss is recognised in statement of profit and loss.
Sales represents invoice value of finished goods sold inclusive of
excise duty and value added tax but excludes sales returns, claims,
rate difference etc.
L. EXCISE DUTY
Excise duty has been accounted for at the time of manufacture of goods,
accordingly excise duty on finished goods lying as stock in factory has
been considered for valuation.
Excise, insurance and other claims/refunds are accounted for on
acceptance/actual receipt/ payment basis.
N. EMPLOYEE BENEFITS
a) Short term employee benefits
All employee benefits payable wholly within twelve months of rendering
the service are classified as short-term employee benefits. Benefits
such as salaries, wages and short term compensated absences, the
expected cost of ex-gratia, etc are recognised in the period in which
the employee renders the related service.
b) Post-employment benefits
i) Defined Contribution Plan: Employee benefits in the form of
Employees State Insurance Corporation and provident fund are considered
as defined contribution plan and the contributions are charged to the
statement of profit and loss for the year when the contributions to the
respective funds are due.
ii) Defined Benefit Plan: Employee benefits in the form of gratuity and
leave encashment are considered as defined benefit plan and are
provided for on the basis of an independent actuarial valuation, using
the projected unit credit method, as at the balance sheet date as per
requirements of Accounting Standard- 15 (Revised 2005) on Employee
Benefits. Actuarial gains/losses, if any, are immediately recognised
in the statement of profit and loss.
O. BORROWING COSTS
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the cost
of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for intended use or sale. Other
borrowing costs are recognised as an expense in the year in which they
a) Current Tax: Current tax is determined as the amount of tax payable
in respect of taxable income for the year in accordance with the
provisions of the Income Tax Act, 1961. Minimum Alternative Tax credit
available under section 115JB of the Income Tax Act, 1961 are accounted
in the year in which the benefits are claimed.
b) Deferred Tax: Deferred tax is recognised subject to consideration of
prudence on the basis of timing differences being the differences
between taxable income and accounting income that originate in one
period and is capable of reversal in one or more subsequent periods
using the tax rates and laws that have been enacted or substantially
enacted as at the balance sheet date. Deferred tax asset is recognised
and carried forward only to the extent there is reasonable certainty
that the asset will be realized in future.
Q. IMPAIRMENT OF ASSETS
An asset is treated as impaired when the carrying cost of the same
exceeds its recoverable amount. Impairment is charged to statement of
profit and loss in the year in which an asset is identified as
impaired. The impairment loss recognised in prior accounting period is
reversed if there has been a change in the estimate of the recoverable
A provision is recognised for a present obligation as a result of past
events if it is probable that an outflow of resources will be required
to settle the obligation and in respect of which a reliable estimate
can be made. Provisions are determined based on best estimate of the
amount required to settle the obligation as at the balance sheet date.
Liabilities which are material and whose future outcome cannot be
ascertained with reasonable certainty are treated as contingent
liability and are disclosed by way of notes to accounts.