Note 1: SIGNIFICANT ACCOUNTING POLICIES: A) Basis of brparation of financial statements: a) The accompanying financial statements have been brpared in accordance with the historical cost convention. b) The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis. c) The company has brpared these financial statements as per the format brscribed by Schedule IN to the Companies Act, 2013 issued by Ministry of Corporate Affairs. Previous periods figures have been recast /regrouped to confirm to the classification required by the Schedule III. B) Fixed Assets: Tangible Assets: Fixed Assets are carried at cost of acquisition less debrciation. C) Debrciation: Debrciation on Fixed Assets has been provided under Written Down Value method, in accordance with the provision of Schedule II to the Companies Act, 2013. D) Inventories: a) Inventories are valued on FIFO at cost or market value, whichever is less. b), Materials lying at Port and with third party are recognized upon receipt of commercial invoice from the supplier. E) Investments: a) Investments are classified into current and non current investments. Non current Investments are stated at cost. Provision for diminution in the value of non current investments is made only if, such a decline in the opinion of the management is other than temporary. b) Investments include shares and securities purchased with the intention of holding them as investments as per Board resolutions. F) Sales: Sales are exclusive of Vat and recognized when goods are supplied in accordance with the terms of sale. Revenue from export Sales is recognized only when the Bills of Lading is received by the company. G) Purchase: Purchases are recognized as per terms of purchase with buyer and exclusive of VAT. H) Rent: Income from rent is accounted as per the terms of agreements on accrual basis I) Interest and Dividend: Interest income is accounted on accrual basis. Dividend income is accounted on receipt basis. J) Employees Benefits: Company's contributions to Provident Fund Pension Scheme for the year are charged to Profit & Loss account. Provision for Leave encashment to employees is made on payment basis. K) Taxation: a) Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax Act, 1961 and considering assessment orders and decisions of appellate authorities in Company's case. b) Deferred tax for timing differences between tax profits and book profits is accounted by using the tax rates and laws that have been enacted or substantially enacted as of the Balance Sheet date. Deferred tax assets in respect of unabsorbed Losses are recognized to the extent there is reasonable certainty that these assets can be realized in future. L) Segment Reporting: The accounting policies adopted for Segment reporting are on line with the accounting policy of the Company. Revenue and Expenditure have been identified to Segments on the basis of their relationship to operating activities of the segment. Revenue and Expenditure which relate to the enterprises as a whole and are not allocable to segments on a reasonable basis have been included under "Un-allocated Expenses" M) Foreign currency Transactions: Foreign currency transactions entered during the year are recorded at the brvailing exchange rate on the date of transaction. Gain / Loss arising on all transactions settled during the year are recognized in profit and loss account. Unsettled foreign currency transactions at the year end are translated at year - end rates. N) Provisions and Contingent Liabilities: The company recognizes a provision when there is a brsent obligation as a result of a past event that probably. requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources |