SIGNIFICANT ACCOUNTING POLICIES

1 Basis of accounting

The accounts of the Company are brpared under the historical cost convention on accrual basis as a going concern.

2 Revenue Recognition:

Items of income and expenditure are recognized on accrual basis except for the following, since it is not possible to ascertain with reasonable accuracy the quantum to be provided in respect of:

a. Interest & delayed payment charges on overdue bills pending as on Balance Sheet date.

b. The additional liability, if any, arising at the time of assessment of tax / duty.

c. Insurance and Other claims.

3 Government Grant

Duty Draw Back Income is recognised on accrual basis based on FOB value of exports.

4 Fixed Assets & Debrciation:

i) Tangible assets are stated at cost net of recoverble taxes, trade discounts and rebates and include amounts added on revaluation, less accumulated debrciation and impairment loss, if any. The cost of tangible assets comprises its purchase price, borrowing cost and any cost directly attributable to bringing the asset to its working condition for its intended use.

ii) Subsequent expenditures related to an item of tangible asset are added to the book value only if they increase the future benefits from the existing asset beyond its brviously assessed standard of performance.

iii) Projects under which the assets are not ready for their intended use are shown as Capital Work In Progress.

iv) Change in Accounting Policy for Debrciation pursuant to Schedule II of the Companies Act, 2013.

Due to application of Schedule II of the Companies Act, 2013 with effect from 1st April, 2014, the management has adopted the 'useful lives' as specified in the said Schedule II. The Company has used the transitional provisions of the Schedule II to adjust the impact arising from the first time application of the Schedule II. If a fixed asset has zero remaining useful life as on 1st April, 2014 (the date on which Schedule II has become effective), its carrying amount, after retaining 5% of the original cost as residual value, is charged to the opening balance of the retained earnings 'Surplus in the Statement of Profit & Loss' under 'Reserves & Surplus'. The carrying amount of fixed assets whose remaining useful life is not 'NIL' as on 1st April, 2014, is debrciated over the remaining useful life.

Accordingly, debrciation of Rs 6242638/- has been adjusted to the opening balance of the retained earnings, with the corresponding effect to the net book value of the tangible assets.

v) Any asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Such impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired. Any impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

5 Investments:

Long term Investments are stated at cost less provision for decline in value other than temporary. Current investments are stated at lower of cost and fair market value on category of investment basis.

6 Inventory:

Inventory of raw materials and consumables are valued at cost or net realizable value, whichever is lower, under FIFO Method. Finished Goods are valued at cost or net realizable value whichever is lower. Cost for the purposes of valuation of finished goods includes cost of material, labour and other direct expenses. Stock-in-process is valued at raw material cost plus proportionate direct cost, wherever applicable.

7 Foreign Currency Transactions:

Expenditure/Income in foreign currency is converted into Indian rupees at the rate of exchange brvailing on the date of transaction. Asset/Liability in respect of foreign exchange transactions outstanding as at the end of the year is restated at the exchange rate brvailing on that date

8 Forward Contracts:

Premium or discount at the inception of forward contract is recognised as expense or income over the period of contract. Any profit or loss arising on cancellation or renewal of forward contract is recognised as income or expense of the year.

9 Deferred tax/Income tax:

Deferred tax is accounted for, by computing the tax effect of timing differences between taxable income and accounting income.

Provision for Current tax is made on the basis of applicable tax laws existing in the country.

Minimum Alternative Tax and its credit are accounted based on the Guidance notes issued by the Institute of Chartered Accountants of India.

Deferred tax assets are recognized and carried forward to the extent that there is reasonable certainty that sufficient future taxable income will be availed against which such deferred tax assets can be realised.

10 Intangible Assets:

Intangible asset, viz, computer software is stated at cost of acquisition less accumulated amortization. Computer software is amortized over a period of 5 Years.

11 Others:

i) Contingent Liabilities are not provided for and are disclosed in notes to the accounts.

ii) Gratuity and leave encashment liability is worked out based on actuarial valuation as at the end of the year.

12 Impairment of assets

Subsequent to Board's decision to close down its Duplex Board Division, Company has re-assessed the market value of assets of Chalakudy unit. Impairment is done to Plant & Machinery and building by comparing the value given by the approved valuer and carrying amount outstanding in books after providing debrciation as per the Companies Act 2013.

13 Additional Diclosures

1 Most of the balances of Sundry Debtors, Sundry Creditors, Advances and Deposits are subject to confirmation.

2 Previous year figures have been re-cast, wherever necessary to comply with the requirements of Revised Schedule VI of The Companies Act 1956.

3 Assets, Loans and advances are in realizable state in the ordinary course of business.

Lease Transactions :

All assets acquired under finance lease basis are capitalized with corresponding liability recognizing the future liability on leases. The total minimum lease payments as on the balance sheet date, interest embedded in such payments and brsent value of lease payments are as follows

Finance charges on lease payments amounting to (Previous Year Nil) for the year has been debited to profit and loss account under the head interest and bank charges.Lease expenses under non cancelable operating lease during the year amounts to Rs NIL (Previous Year Rs Nil)

Future minimum lease payments under non cancellable operating lease as on 31-03-2015 is as follows

Payable within One year NIL

Payable after one year but before five years NIL

Discontinuing operations

On 14/11/2015, Board of Directors announced the plan to discontinue operations of the Duplex Board Division of the company operating at Chalakudy.

The decision of the disposal is in line with the company's long term startegy to focus on more profit making segments rather than low margin or loss making segments.

Further it was also decided to scrap the plant and machinery and building and sell off the same for which a valuation report has been placed and approved by the Board. It is proposed to sell off the land separately. It is expected that these operations will be concluded by March 2016.

At 31st March, 2015, the carrying amount of the assets of the division was Rs.529.55 lakhs and its liabilities were Rs.48.92 Lakhs. The above carrying amounts of assets were determined after providing for an impairment loss of Rs 614.80 Lakhs (Previous Year NIL) in the year ending on 31.03.2015.

The following statement shows the revenue and expenses of discontinuing operations

 Subject to our report of even date

For Balan & Co.

Chartered Accountants FRN:000340S

Sd/- A. Mohanan, B.Sc., FCA, DISA

M. No.20627

Partner

Sd/- R. Ponnambalam

Company Secretary

For and on behalf of the Board

S. Rajkumar,

(DIN 01790870)

Vice Chairman & Managing Director

Sd/- A. Padmanabhan,

(DIN 00037472) Executive Director

Sd/- N. Purushotama Prabhu

(DIN 000384830) Whole Time Director - Operations

Sd/-Usha Venugopal

Chief Financial Officer

PLACE : Cochin  

DATE : -16 30-05-2015