i) Basis of preparation of Financial statements
 
 The Financial statements have been prepared under the historical cost
 convention in accordance with generally accepted Accounting principles
 and on the Principle of going concern and in accordance with applicable
 Accounting standards adopted consistently. Company generally follows
 mercantile system of accounting and recognises significant items of
 income and expenditure on an accrual basis.
 
 ii) Use of Estimates
 
 The Preparation of financial statements require management to make
 certain estimates and assumptions that effect the amounts reported in
 financial statements and notes thereon. Difference in actual results &
 estimates are recognised in the period in which they materialize.
 
 iii) Fixed Assets
 
 The gross block of all Fixed Assets is stated at cost of acquisition
 net of vat less accumulated depreciation. Rubber moulds of small value
 have not been capitalized and considered as consumables and charged to
 revenue.
 
 iv) Depreciation
 
 Depreciation on all Fixed Assets is provided on written down value
 method at the rates and in the manner prescribed by Schedule XIV of the
 Companies Act 1956. Assets costing up to Rs. 5000/- are depreciated
 fully in the year of Purchase. Depreciation on additions / Deletions of
 Assets is provided on Pro-Rata basis.
 
 v) Investments
 
 Long term Investments are valued at cost with an appropriate provision
 for permanent diminution in value. Current investments are stated at
 lower of the cost or quoted / fair value.
 
 vi) Inventories
 
 (A) Raw materials are valued at lower of the cost or net realisable
 value; cost is arrived at on FIFO basis. Cost includes costs incurred
 in bringing them to their present location.
 
 (B) Stores & Consumables are valued at cost.
 
 (C) Finished goods are valued at lower of the cost or net realisable
 value. Cost of finished goods is determined by taking material, labour
 and appropriate factory overheads.
 
 (D) Inventory of spares / tools, Rubber Moulds is not valued and is
 charged to revenue.
 
 vii) Sales / Revenue Recognition
 
 Sales are net of tax adjusted for gain / loss on export realisation,
 year end restatement and corresponding forward exchange contracts.
 Company recognises sales at the point of dispatch / delivery of the
 goods to the customer. Interest / rental income is recognised on time
 proportionate basis.
 
 viii) Foreign Currency Transaction
 
 (a) Transactions denominated in Foreign Currencies are normally
 recorded at the exchange rate prescribed by customs at the time of
 transaction.
 
 (b) Monetory items denominated in foreign currencies at the year-end
 are restated at the year end rates. Incase of forward exchange
 contracts, the difference between the year end rate and rate on the
 date of contract is recoginsed as exchange difference and premium or
 discount on forward exchange contracts is regonised over the life of
 the contract.
 
 (c) Non-monetary foreign currency items are carried at cost.
 
 (d) Any income or expense on account of exchange difference either on
 settlement or on translation is recognised in the profit and loss
 account.
 
 (e) Exchange difference is adjusted against sales / purchases etc.,
 wherever applicable. (f) Company has not excercised option for the
 treatment of Foreign exchange difference relating to capital asset as
 per recent notification relating to the Provisions of AS 11. During the
 year there was no capital expenditure in Foreign currency.
 
 ix) Employee Retirement Benefits
 
 Company have opted for Group Gratuity Scheme with LIC of India;
 Company’s contribution based on a actuarial valuation by LIC is charged
 to Profit & Loss Account. Contribution to Provident / Family Pension
 Fund as percentage of salary is charged to Profit & Loss Account on
 accrual basis.
 
 Accrued leave Salary is estimated and provided on actual basis. The
 expense is recognised at present value of amount payable to Employees.
 Total liability for Leave Salary outstanding at year end rate is Rs.
 2.96 Lacs.
 
 x) Taxation
 
 Provision for current tax is made considering Rules/ benefits
 admissable under Income tax Act 1961. Deferred Tax Liability resulting
 from timing difference between book profit and taxable profit for the
 year is calculated by using tax rates & tax laws that have been enacted
 or substantially enacted at the Balance sheet date.
 
 xi) Provisions, Contingent Liabilities and Contingent Assets
 
 Provisions in respect of present obligations arising out of past events
 are made in Accounts where reliable estimation can be made of the
 amount of obligation. Contingent Liabilities are not provided for and
 if material are disclosed separately by way of note. Contingent Assets
 are neither recognised nor disclosed in Financial Statement.