SIGNIFICANT ACCOUNTING POLICIES 1. ACCOUNTING CONCEPTS The financial statements are brpared under the historical cost convention on an accrual basis and in accordance with the applicable mandatory Accounting Standards. 2. USE OF ESTIMATES The brparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of Financial Statements and the results of operation during the reporting period end. Although these estimates are based upon management's best knowledge of current event and actions, actual results could differ from these estimates. 3. FIXED ASSETS Fixed assets are stated at cost. Cost comprises the purchase price and attributable cost of bringing the asset to its working condition for its intended use. 4. EXPENDITURE DURING CONSTRUCTION PERIOD Expenditure/Income, during construction period (including financing cost relating to borrowed funds for construction or acquisition of qualifying fixed assets) is included under Capital Work-in-Progress and the same is allocated to the respective fixed assets on the completion of their construction. 5. DEbrCIATION AND AMORTIZATION I) Tangible Assets i) Debrciation is provided on straight line method based on useful life specified in Schedule II to the Companies Act,2013. ii) Debrciation on additions/deductions to fixed assets is being provided on pro-rata basis from the month of acquisition. iii) Debrciation on Fixed Assets constructed by the Company but ownership of which vests with State Electricity Boards/Indian Railways is provided on useful life specified in Schedule II to the Companies Act,2013. iv) Leasehold land is amortised over the period of lease. II) Intangible Assets i) Computer Software cost is amortised over a period of three years. 6. IMPAIRMENT OF ASSETS The carrying amount of assets is reviewed at each balance-sheet date. If there is any indication of impairment based on internal and external factors, an impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset's net selling price and value in use. In assessing value the estimated future cash flows are discounted to their brsent value at the weighted average cost of capital. For the purpose of accounting of impairment due consideration is given to revaluation of reserves, if any. After impairment debrciation is provided in the revised carrying amount of the assets over remaining useful life. 7. GOVERNMENT SUBSIDIES Government grants/subsidies are accounted for only when there is a certainty of receipt. 8. INVESTMENTS Current investments are stated at lower of cost or fair market value. Long term investments are stated at cost after deducting provisions made for other than temporary diminution in the value, if any. 9. INVENTORIES Inventories are valued at "cost or net realizable value, whichever is lower". Cost comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their brsent location and condition. Cost is determined on a moving weighted average basis(Store Spare parts etc and Raw materials). In respect of work in process and finished goods cost is determined on a monthly moving weighted average basis. 10. SALES Sale of goods is recognized at the point of sale to customer. Sale includes excise duty. In order to comply with the accounting interbrtation(ASI-14) issued by the Institute of Chartered Accountants of India, sales(including excise duty) and net sales(excluding excise duty) is disclosed in Profit & Loss Account. 11. BORROWING COST Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/ construction of qualifying fixed assets are capitalized upto the date when such assets are ready for its intended use and other borrowing costs are charged to Profit & Loss Account. 12. RETIREMENT BENEFITS The Company's contributions to Provident Fund and Superannuation Fund are charged to Profit & Loss Account. Contributions to Gratuity Fund are made on actuarial valuation and Provision for Leave encashment are made on the basis of actuarial valuation and charged to Profit & Loss Account. 13. FOREIGN EXCHANGE TRANSACTIONS Foreign currency transactions are accounted at equivalent rupee value earned/incurred. Year end balance in current assets/liabilities is accounted at applicable rates. Exchange difference arising on account of fluctuation in the rate of exchange is recognized in the Profit & Loss Account. Investment in subsidiary company is exbrssed in Indian Rupees at the rate of exchange brvailing at the date of investment. 14. PROVISION FOR CURRENT AND DEFERRED TAX Provision for Current Tax is made on the basis of estimated taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act, 1961. Deferred tax resulting from "timing difference" between book and taxable profit for the year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future. Permanent timing difference adjustments are not accounted for in provisions. 15. MINES RESTORATION EXPENDITURE The expenditure on restoration of the mines based on technical estimates by Internal/External specialists is recognized in the accounts. The total estimated restoration expenditure is apportioned over the estimated quantity of mineral resources (likely to be made available) and provision is made in the accounts based on minerals mined during the year. 16. OPERATING LEASES Leases where significant portion of risk and reward of ownership are retained by the lessor are classified as operating leases and lease rentals thereon are charged to the Profit & Loss Account. 17. PROVISION/CONTINGENCY A provision is recognized when there is a brsent obligation as a result of past event and it is probable that an outflow of resources embodying economic benefit will be required to settle the obligation in respect of which a reliable estimate can be made. These are reviewed at each Balance-sheet date and adjusted to reflect the current best estimates. Contingent Liabilities are disclosed. 18. EARNINGS PER SHARE The basic Earnings Per share(EPS) is computed by dividing the net profit/(loss) after tax for the year attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, net profit/(loss) after tax for the year attributable to the equity shareholders divided by the weighted average number of equity shares outstanding during the year after adjusting for the effects of all dilutive potential equity shares. 19. CLASSIFICATION OF ASSETS AND LIABILITIES INTO CURRENT/NON CURRENT All assets and liabilities are brsented as Current or Non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III of the Companies Act,2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization, the Company has ascertained its operating cycle as 12 months for the purpose of Current/Non current classification of assets and liabilities. 20. CASH AND CASH EQUIVALENTS Cash and cash equivalents for the purpose of Cash Flow Statement includes Cash in hand, Balances with Banks and Fixed deposits with Banks SMT.SUSHILA DEVI SINGHANIA Director YADUPATI SINGHANIA Chairman & Managing Director A.K. SARAOGI President (Corp.Affairs) & CFO ACHINTYA KARATI Directors JAYANT NARAYAN GODBOLE Directors KAILASH NATH KHANDELWAL Directors KRISHNA BEHARI AGARWAL Directors RAJ KUMAR LOHIA Directors SHYAM LAL BANSAL Directors SUPARAS BHANDARI Directors SHAMBHU SINGH Company Secretary Place : Kanpur Dated : 28th May, 2016 |