A. Accounting Convention
The financial statements are prepared under historical cost convention
on accrual basis in accordance with the mandatory accounting standards
read with notes and relevant presentational requirements of the
Companies Act, 1956.
Long term investments are stated at cost less provision, if any, for
diminution in value of such investments other than temporary. Current
investments are stated at lower of cost and fair value.
C. Fixed Assets
a) Fixed assets are shown at cost less accumulated depreciation.
b) Depreciation on fixed assets is provided on Straight Line Method
(SLM) at rates specified in Schedule XIV to the Companies Act, 1956.
c) No depreciation is provided on fixed assets held for disposal and
shown under current assets at estimated realizable value.
Inventories are valued at cost or net realizable value whichever is
lower. The cost is determined on FIFO basis.
Interest on securities (other than fixed deposits with banks)
pledged/deposited with the Government Departments is accounted for on
F. Recognition of Income & Expenditure
a) Brokerage, Service Tax, Education Cess and Securities Transaction
Tax to the extent not available as rebate under Income Tax Act, 1961 on
purchase/sale of shares and other securities are charged directly to
Profit & Loss Account.
b) Provision for loss in respect of Open Equity Derivative Instruments
as at the Balance Sheet date is made Index-wise/Scrip-wise. As a matter
of prudence, any anticipated profit is ignored.
A provision is recognized when the company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle such obligation, in respect of which a
reliable estimate can be made.
H. Contingent Liabilities
Contingent liabilities not provided for in the accounts are separately
disclosed in the Notes to Accounts.
I. Employee Benefits
i Long Term Employee Benefits
a) Defined Contribution Plans
The company''s contribution to defined contribution plans is charged
to Profit & Loss Account as incurred.
b) Defined Benefit Plans
Defined Benefit Plan is provided on the basis of valuation as at the
balance sheet date carried out by independent actuary. The actuarial
valuation method used by independent actuary for measuring the
liability is the Projected Unit Credit Method.
c) Other Long Term Employee Benefits
Other long term benefit is provided on the basis of valuation as at the
date carried out by independent actuary. The actuarial valuation method
used by independent actuary for measuring the liability is the
Projected Unit Credit Method.
ii Actuarial gains and losses comprise experience adjustments and the
effects of the changes in actuarial assumptions are recognized
immediately in the Profit & Loss Account as income or expense.
iii Employee benefits which fall due wholly within twelve months after
the end of the period in which the employees render the related service
are recognized at the amount expected to be paid for it.
J. Foreign Exchange Transactions
Transactions in foreign currencies are recorded at the exchange rate
prevailing on the date of the transaction. Liability / receivables on
account of foreign currency are converted at the exchange rates
prevailing as at the end of the year and gains / losses thereon are
taken to the Profit & Loss Account.
K. Earnings per share
The earnings considered in ascertaining the Company''s EPS comprises
the net profit after tax. The number of shares used in computing Basic
EPS is the weighted average number of shares outstanding during the
year. The number of shares used in computing Diluted EPS comprises of
weighted average shares considered for deriving Basic EPS, and also the
weighted average number of equity shares which could have been issued
on the conversion of all dilutive potential equity shares.
L. Use of estimates
The preparation of financial statements requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Difference
between the actual results and estimates are recognized in the period
in which the results are known / materialized.