a.  GENERAL:
 
 The accounts are prepared under the historical cost convention and in
 accordance with generally accepted accounting practices.
 
 b.  FIXED ASSETS:
 
 Fixed Assets are stated at cost less accumulated depreciation. Cost of
 acquisition of fixed assets is inclusive of freight, duties, taxes,
 incidental expenses relating to the cost of acquisition and the cost of
 installation/erection, as applicable.
 
 c.  DEPRECIATION:
 
 Depreciation is provided under Written Down Value method in accordance
 with the rates and rules prescribed under schedule XIV of the Companies
 Act 1956. The company has used the following rates to provide
 depreciation on its fixed assets.
 
 d.  INVENTORIES:
 
 Valuation of inventories is made as under:
 
 i) Finished goods are valued at lower of cost or net realizable value.
 
 ii) Raw materials, work-in-progress and stores and spares are valued at
 cost, following the FIFO Basis.
 
 iii) Work-in-Progress, raw materials, stores, spares are valued at cost
 except where the net realizable value of the finished goods they are
 used in is less than the cost of finished goods and in such an event,
 if the replacement cost of such materials etc., is less than their
 books value, they are valued at replacement cost.
 
 iv) By-products and scrap are valued at net realizable value.
 
 e.  SALES:
 
 Sales are accounted for net of discounts and rebates. Export Sales are
 initially accounted at the exchange rate prevailing on the date of
 documentation/invoicing and the same is adjusted with the difference in
 the rate of exchange arising on actual receipt of proceeds in foreign
 exchange.
 
 f.  FOREIGN EXCHANGE TRANSACTIONS:
 
 i) Transactions in foreign currency are initially accounted at exchange
 rate prevailing on the date of transaction, and adjusted appropriately,
 with the difference in the rate of exchange arising on actual
 receipt/payment during the period under report.
 
 ii) At each Balance Sheet date Foreign currency monetary items being
 receivables/ payables are reported using the rate of exchange on that
 date and difference is recognized as income or expense. Foreign
 currency non-monetary items are reported using the exchange rate at
 which they were initially recognized.
 
 iii) In respect of forward exchange contracts in the nature of hedges.
 Premium or discount on the contract is amortized over the term of the
 contract. Exchange differences on the contract are recognized as profit
 or loss in the period in which they arise.
 
 g. CONTINGENT LIABILITIES:
 
 Contingent Liabilities are not recognized in the accounts, but are
 disclosed after a careful evaluation of the concerned facts and legal
 issues involved.
 
 For the purpose of the above details the Status of the ''Suppliers''
 under the Act has been determined to the extent of and based on the
 information furnished by the respective parties, and has accordingly
 been relied upon by the company and its auditors.