I Note 1I Significant Accounting Policies 1. Basis of Preparation of financial statements : The financial statements are brpared in accordance with Indian Generally Accepted Accounting Principles ('GAAP') under the historical cost-convention on the accrual basis. GAAP comprises mandatory accounting standards as brscribed under Section 133 of the Companies Act, 2013 ('the Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied except, where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard required a change in the accounting policy hitherto in use. 2. Use of estimates : The brparation of financial statements is in conformity with generally accepted accounting principles ('GAAP') which requires the management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods. 3. Fixed assets, Debrciation and Amortisation : (I) Fixed assets are stated at cost of acquisition / construction (net of CENVAT) less accumulated debrciation. Cost includes purchase price and other costs attributable to acquisition / construction of fixed assets. (II) (i) Debrciation on assets is provided over the useful lives of assets as brscribed under Schedule II to the Companies Act, 2013. (iii) Debrciation is provided on written down value method except in respect of building and plant and machinery purchased after 30.4.1987, which are debrciated on straight line method. (iv) Capital expenditure in respect of which ownership does not vest with the Company is amortized over a period of five years. Leasehold land is amortised over the period of lease. (v) In respect of Cable division all assets are debrciated on straight line method. (vi) Borrowing costs attributable to acquisition/construction of qualifying assets within the meaning of the Accounting Standard (AS) 16 'Borrowing Costs' are capitalised as a part of the cost of fixed assets. (vii) Pre-operation expenses including trial run expenses (net of revenue) are capitalised. (viii)Components of an asset has been identified based on where their value is significant in relation to the total value of the asset and where those components have different useful lives to the remainder of asset and debrciated over useful life of that component of an asset. 4. Impairment of assets : The Company assesses, at each balance sheet date, whether there is any indication of impairment of the carrying amount of the Company's assets. An impairment loss is recognised in the Statement of profit and loss, wherever the carrying amount of the assets exceeds its estimated recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their brsent value, based on an appropriate discounting factor. Impairment losses are recognised in the Statement of profit and loss. The impairment loss recognised in prior accounting period is reversed if there has been change in recoverable amount. 5. Investments : All long- term investments are stated at cost. Provision for diminution in value of long term investments is made if it is other than temporary in nature. Current investments are valued at lower of cost and market value. 6. Inventories : Inventories are valued at lower of standard cost or net realizable value. Cost includes material cost, cost of labour and attributable manufacturing overheads. Cost of materials is arrived at on weighted average basis. Inventory of scrap is valued at estimated realisable value. Inventories of finished goods include excise duty as applicable. 7. Government grants : (i) Government grants are recognised in the financial statements when they are received and there is reasonable assurance that the Company will comply with the conditions attached to them. (ii) Government grants, which are in the nature of refundable interest free loans received from government/semi-government authorities, are credited to secured/unsecured loans. (iii) Government grants which are in the nature of subsidies received from government/semi-government authorities and which are non-refundable are credited to reserves. 8. Employee stock options : In respect of the employee stock options, the excess of fair price on the date of grant over the exercise price is recognised as deferred compensation cost amortized over vesting period. 9. Voluntary retirement schemes : Compensations paid under voluntary retirement schemes are amortized over a period not exceeding 5 years, up to 31st March, 2010. The expenses incurred after 31st March, 2010 are charged to Statement of profit and loss. 10. Enterprise resource planning cost : Cost of implementation of ERP Software including all related direct expenditure is amortized over a period of 5 years on successful implementation. 11. Share issue expenses : Share issue expenses are written off against share brmium account if any or amortized over a period of 5 years. 12. Revenue recognition : (i) Sale of goods is recognised on despatch to customers and on date of shipment in case of exports. Sales exclude amounts recovered towards sales tax and excise duty and is net of returns. (ii) Price variation claims are accounted in accordance with the terms of contract and/or upon admittance by customers. (iii) Dividend income on investment is recognised when the right to receive payment is established. (iv) In respect of service activities, income is recognised as and when services are rendered. (v) Lease rental on operating lease is accounted on accrual basis. 13. Post-employment benefits : Defined Contribution Plans: In respect of the Company's provident fund scheme, the Company makes specified monthly contributions towards employee provident fund directly to the Government under the Employees Provident Fund Act, 1952 and is not obliged to bear the shortfall, if any, between the return on investments made by the Government from the contributions and the notified interest rate. In respect of the Company's approved superannuation scheme, the Company makes specified contributions to the superannuation fund administered by the Company and the return on investments is adequate to cover the commitments under the scheme. The Company's contribution paid/payable under these schemes is recognised as expense in the Statement of profit and loss during the period in which the employee renders the related service. Defined Benefit Plans: In respect of the Company's gratuity and leave wages schemes, the brsent value of the obligation under such scheme is determined based on actuarial valuation using the Projected Unit Credit Method. The discount rates used for determining the brsent value of the obligation is based on the market yields on Government securities as at the balance sheet date. Actuarial gains and losses are recognised immediately in the Statement of profit and loss. Long-term compensated absences are provided for based on actuarial valuation, made at the year end, by independent actuaries. 14. Translation of foreign currency : (i) The Company translates foreign currency transactions during the year, at the conversion rates brvailing on transaction dates. (ii) Monetary items remaining unsettled at the year end are translated / reported at the year end rate. Exchange differences arising on such revaluation are recognised in the Statement of profit and loss. (iii) Non-Monetary items (other than fixed assets) are reported at the exchange rate at which they are accounted. (iv) In case of forward contracts, brmium on the forward contracts is recognised as income or expense over the life of the contract. (v) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Statement of profit and loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets. 15. Derivative Contracts : Derivative contract entered into, to hedge commodity/forex unexecuted Firm commitment and highly probable forecast transaction are recognised in the financial statement at fair value as on Balance sheet date. The gains or losses arising out of fair valuation of derivative contracts are recognised in the Statement of profit and loss or Balance sheet as the case may be after applying the test of hedge effectiveness. The gain or losses are recognised as 'Hedge Reserve' in the Balance sheet when the hedge is effective and where the hedge is ineffective the same is recognised in the Statement of profit and loss. The gains and losses on roll over or cancellation of derivative contract which qualify as effective hedge are recognised in the Statement of profit and loss in the same period in which the hedge item is accounted. 16. Export benefits/Incentives : The Company accounts for excise duty rebate on deemed and physical exports, duty entitlements and Focus benefits on physical exports on accrual basis. Premium on special import licence is credited in the accounts as and when realised. The benefits in the form of entitlements to Advance Licenses for duty free import of raw materials in respect of exports made are accounted when such imports are made. The benefits in the form of entitlements to status holders licenses are accounted when licenses are utilised. 17. Claims against the Company not acknowledged as debts : The demands under disputed showcause notices / orders of statutory authorities are provided in the accounts on the basis of management's estimate and the balance, if any, are included in contingent liability. 18. Taxes on income : (a) Tax on income for the current period is determined on the basis of estimated taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961 and based on the expected outcome of assessments / appeals. (b) Deferred tax is recognised on timing differences between the accounted income and the taxable income for the year, and 19. quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date. (c) Deferred tax assets relating to unabsorbed debrciation / business losses are recognised and carried forward to the extent there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. (d) Other deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Provision for contingencies : A provision is recognised when there is a brsent obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made. Disclosure of 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. When likelihood of such outflow is remote, no provision or disclosure is made. Provision arising from litigations, assessments by statutory authorities, etc. is made when the Company based on legal advise wherever necessary estimates that the liability has been incurred and the amount can be reasonably estimated. Accounting for interest in joint ventures : Interest in joint ventures (i.e., jointly controlled entity) are accounted for as follows: (a) income on investment in incorporated jointly controlled entity is recognised When the right to receive the same is established. (b) investment in such joint venture is carried at cost after providing for any Permanent diminution in value. Borrowing costs : (a) Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of such asset till such time as the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily requires a substantial period of time (generally over twelve months) to get ready for its intended use or sale. (b) All other borrowing costs are recognised as expense in the period in which they are incurred. Lease accounting : Operating lease rentals are expensed with reference to lease terms and other considerations. 1.As per the Accounting Standard (AS), 28 Impairment of Assets, the Company has reviewed the potential generation of economic benefit from its fixed assets and accordingly, necessary impairment loss has been provided in the financial statements. 2.Figures for brvious year have been regrouped, wherever necessary. Signatures to Note 1 to 44 SHARP & TANNAN Chartered Accountants Firm's Registration No. 109982W by the hand of Milind P. Phadke Partner Membership No. 033013 For and on behalf of the Board of Directors Kushal N. Desai Managing Director & Chief Executive Officer DIN : 00008084 Dr. N.K. Thingalaya Director DIN : 00019226 V. C. Diwadkar Chief Financial Officer Sanjaya R. Kunder Company Secretary Place : Mumbai, date : 25th May , 2016 |