1. The accounts have been prepared on historical cost convention and on
 going concern basis and based on the provisions of Companies Act, 1956.
 
 2. FIXED ASSETS
 
 Fixed assets have been stated at cost of Construction/acquisition/ fabrication.  In respect of projects
involving construction related pre-operational expenses including interest, form part of the value of assets
capitalised.  Dies for Locks and Latches are capitalised in the year of approval in which sample of
Locks/Latches produced from the said dies are received from customers.
 
 3. INVESTMENTS
 
 Investments held on permanent basis are stated at cost of acquisition.
 
 4. INVENTORIES
 
 a. Finished goods are valued at lower of cost or market value.
 
 b. Semi finished goods are valued at cost of finished goods less 10%
 being estimated expenditure to be incurred to make these as finished
 goods.
 
 c. Raw Materials, Components, Stores & Spares are valued at cost.
 
 d. Loose Tools are valued at depreciated cost.
 
 e. Saleable scrap is valued at estimated realisable value.
 
 5. REVENUE RECOGNITION
 
 i. Revenue is recognised in case of product sales at the time of despatch of goods from factory/depots.
 
 ii. Sales are net of Inter Unit/Depot transfers but inclusive of material produced and consumed/capitalised
by other Divisions/units.
 
 6. EMPLOYEE BENEFITS
 
 i. Provident Fund
 
 The Company operates a provident fund trust for its officers excepting
 in the case of its employees where the provident fund contributions are
 deposited with the appropriate authorities.
 
 ii. Superannuation/Gratuity
 
 The Company operates a Superannuation fund/Gratuity fund Trust which in
 turn have taken policies with the Life Insurance Corporation of India
 for all eligible employees.
 
 iii. Leave Encashment
 
 Leave Encashment is accounted for on cash basis following past practice.
 
 7. FOREIGN EXCHANGE TRANSACTION :
 
 Foreign Currency transactions outstanding at year end are restated at
 rate of exchange prevailing at the close of the year.  The resultant
 exchange gains and/or losses are recognised in the profit & loss
 account.
 
 8. DEPRECIATION :
 
 i. Depreciation on fixed assets, other than lease hold land, is charged on straight line method at rates
derived from the rates provided for corresponding assets under the Income Tax Act.  The rates followed are :
 
 Building                                         3.34%
 Plant & Machinery                8.70% 111.88% 111.31%
 Dies & Jigs                                     11.31%
 Furniture & Fixtures                             3.34%
 Electric Installation                    11.88%/11.31%
 Vehicles                                 11.88%/17.07%
 Tubewells                                        3.34%
 
 Represents rates adopted for vehicles acquired on and after 1.4.1990.
 
 ** Schedule XIV rates adopted for additions made after 1.4.91 where
 Income Tax Rates were lower.
 
 ii.a.  For assets acquired prior to 2.4.1987 depreciation is provided at rates applicable at the time of
acquisition.
 
 b. Computers, Dies and Jigs are depreciated prorata at rates prescribed in Schedule XIV to the companies
Act, 1956.
 
 c. Premiums paid for lease hold land are amortised over the period of
 lease.