(a) Accounting Convention
The financial statements presented herewith are prepared in accordance
with the historical cost convention and on accrual basis.
(b) Fixed Assets and Depreciation
The Company has provided depreciation on Straight line method at the
specified under schedule XIV of the companies act 1956 on pro-rata
(c) Amortisation of Preliminary, Pre-Operative & Differed Revenue
1/10 of Preliminary & Pre-Operative Expenses are amortised during the
In absence of taxable profits, no provision for Income-tax has been
made in accounts.
(e) Sundry debtors and Loans and Advances :
In the opinion of the board and to the best of their knowledge and
belief the value on realisation of current assets, loans and advances
in the ordinary course of business would not be less than the amount of
which they are stated in the balance sheet. The provision for all
known liabilities is adequate and neither in excess nor short of the
amount reasonably necessary.
(f) Inventories :
Inventories on hand are carried at Direct Cost or Net Realisable value
whichever is lower. Direct Cost Comprises Raw Materials, Direct wages,
Consumables, Power and Fuel.
(g) Excise Duty :
1. Excise duty on goods manufactured laying in the factory premises are
accounted as and when goods are dispatched.
2. Excise duty collected on sales has been included in sales.
3. Excise duty Receivable reflects net of Modvat Credit during the year
as well as cash deposited in Personal Ledger Account during the year.