Accounting Policies of Kalyani Forge Ltd. Company

Mar 31, 2025

2. SUMMARY OF MATERIAL ACCOUNTING
POLICIES

2.1 Basis of Preparation of Financial
Statements:

These financial statements are prepared in
accordance with Indian Accounting Standard
(Ind AS), under the historical cost convention
on the accrual basis except for certain financial
instruments which are measured at fair values,
the provisions of the Companies Act, 2013 (''the
Act'') and guidelines issued by the Securities
and Exchange Board of India (SEBI). The Ind
AS are prescribed under Section 133 of the
Act read with Rule 3 of the Companies (Indian
Accounting Standards) Rules, 2015 and relevant
amendments issued thereafter.

Accounting policies have been consistently
applied except where a newly issued accounting
standard is initially adopted or a revision to an
existing accounting standard requires a change
in the accounting policy hitherto in use.

These financial statements were approved and
authorised for issue with the resolution of the
Board of Directors on 27^th May 2025.

2.2 Use of Estimates

The preparation of financial statements
in conformity with the recognition and
measurement principles of Ind AS which
requires the management to make estimates
and assumptions that affect the reported
amounts of assets, liabilities, revenue and
expenses and disclosure of contingent assets
and liabilities. The estimates and assumptions
used in the accompanying financial statements
are based upon management''s evaluation of
the relevant facts and circumstances as of the
date of the financial statements. Actual results
may differ from the estimates and assumptions
used in preparing the accompanying financial

statements. Any revisions to accounting
estimates are recognized prospectively in future
periods. Key sources of estimation of uncertainty
at the date of the financial statements which
may cause a material adjustment to the
carrying amounts of assets and liabilities within
the next financial year, is in respect of useful lives
of property, plant and equipment, provisions
and contingent liabilities.

2.3 Property, plant and equipment and
depreciation:

(i) Since there is no change in the functional
currency, the company has elected to
continue with the carrying value for all
of its property, plant and equipment as
recognized in its Indian GAAP financial
statements as deemed cost at the transition
date viz. 1^st April 2016. Property, plant and
equipment are stated at their cost of
acquisitions including incidental expenses
related to acquisition and installation of
the concerned assets and including cost
of specific borrowings. The Property, plant
and equipment manufactured internally by
the Company are stated at manufacturing
cost. Property, plant and equipment are
shown net of accumulated depreciation,
except free hold and, which is at cost.

(ii) Expenditure on New Projects and
Expenditure during the construction etc:

I n case of new projects and in case of
substantial modernization or expansion
at the existing units of the company,
expenditure incurred including interest on
borrowing and financing cost of specific as
well as general borrowing, till the time asset
becomes ready for intended use or sale is
being capitalised to the cost of asset. Trial
run expenditure is also capitalized.

(iii) I ntangible assets are measured on initial
recognition at cost. Expenditure incurred in
development phase, where it is reasonably
certain that outcome of development
will be commercially exploited to yield
future economic benefit to the company
is considered as an intangible asset. Such
developmental expenditure is capitalized at
cost including share of allocable expenses.

(iv) Depreciation / Amortization on Assets
(other than Freehold Land) :

Pursuant to enactment of the companies
act 2013 (the ‘Act''), the company has
revised useful life of its Property, plant and
equipment as per provision of schedule II
of the said act. Accordingly the company
provides depreciation on all its assets on
the "Straight Line Method" in accordance
with the said act.

Cost of Power line is being amortized over
a period of 7.5 years when put to use.

Intangible assets are amortized over their
respective individual estimated useful
lives on a straight line basis, commencing
from the date the asset is available to the
Company for its intended use.

2.4 Inventories:

(i) Stores and spares, raw materials and
components are valued at cost or net
realizable value whichever is lower, Cost of
Inventories has been computed to include
all cost of purchases, cost of conversion
and other costs incurred in bringing
the inventories to their present location
and condition.

(ii) Cost of Raw materials is ascertained on
weighted moving average basis.

(iii) Work-in-process, Dies under fabrication
and Finished Goods are valued at the lower
of cost or net realizable value.

(iv) Scrap and Non-moving semi-finished
goods, slow-moving and obsolete items,
are valued at the lower of cost or net
realizable value.

(v) Stock of Trial Product is valued at cost.

(vi) Dies, Die Block and Die Steel are valued at
material cost.

(vii) Goods in transit are stated at actual cost up
to the date of Balance Sheet.

2.5 Research & Development costs:

(i) Capital Expenditure is included in Fixed
Assets & Capital Work in Progress and
depreciation is provided at the respective
applicable rates.

(ii) Revenue expenditure incurred on R&D is
included in the respective account heads
in the financial statements.

2.6 Share Issue expenses

Share issue expenses are written off over a
period of ten years

2.7 Post employment and other employee
benefits:

(i) Short terms employee benefits

Short-term employee benefits such as
salaries, wages, performance incentives
etc. are recognised as expenses at the
undiscounted amounts in the Statement
of Profit and Loss of the period in which
the related service is rendered. Expenses
on non-accumulating compensated
absences is recognised in the period in
which the absences occur.

(ii) Provident Fund

Benefits in the form of Provident Fund and
Pension Scheme whether in pursuance
of law or otherwise which are defined
contributions and are accounted on
accrual basis and charged to statement
of profit and loss of the year.

(iii) Gratuity

The employees'' gratuity fund scheme is
Company''s defined benefit plan. Payment
for present liability of future payment of
gratuity is being made to the approved
gratuity fund under cash accumulation
policy of the Life Insurance Corporation of
India. The Employees'' gratuity, a defined
benefit plan, is determined based on
valuations, as at the balance sheet date,
made by an independent actuary using
the Projected Unit Credit Method. Re¬
measurement, comprising of actuarial
gains and losses, in respect of gratuity are
recognised in the OCI, in the period in
which they occur and is not eligible to be
reclassified to the Statement of Profit and
Loss in subsequent periods. Past service
cost is recognised in the Statement of Profit
and Loss in the year of plan amendment
or curtailment. The classification of
the Company''s obligation into current
and non-current is as per the actuarial
valuation report.

(iv) Privilege Leave Benefits

Accumulated leave which is expected to
be utilised within next twelve months, is
treated as short-term employee benefit.
Leave entitlement, other than short term
compensated absences, are provided
based on a actuarial valuation, similar to
that of gratuity benefit. Re-measurement,
comprising of actuarial gains and losses, in
respect of leave entitlement are recognised
in the Statement of Profit and Loss in the
period in which they occurred.

(v) Termination Benefits

Termination benefits such as compensation
under voluntary retirement scheme
is recognized as liability in the year
of termination.

2.8 Foreign Currency Transactions

(i) Initial recognition

The company''s financial statements are
presented in INR, which is also its functional
currency. Foreign currency transactions
are recorded in the reporting currency, by
applying to the foreign currency amount,
the exchange rate between the reporting
currency and the foreign currency at the
date of transaction.

(ii) Conversion

Monetary Assets and Liabilities, designated
in foreign currencies are revalued at the rate
prevailing on the date of Balance Sheet or
forward contract rate or other appropriate
contracted rate. Non-monetary assets
and liabilities that are measured in terms
of historical cost in foreign currencies are
not revalued.

(iii) Exchange Differences

Exchange difference arising on the
settlement and conversion on foreign
currency transactions is recognized as
income or expenses in the year in which
it arises.

2.9 Investments and Other Financial Assets:
(i) Initial Recongnition

In the case of financial assets, not recorded
at fair value through profit or loss (FVPL),
financial assets are recognised initially at
fair value plus transaction costs that are

directly attributable to the acquisition of
the financial asset. Purchases or sales of
financial assets that require delivery of
assets within a time frame established by
regulation or convention in the market
place (regular way trades) are recognised
on the trade date, i.e., the date that the
Company commits to purchase or sell
the asset.

(ii) Subsequent Measurement

For purposes of subsequent measurement,
financial assets are classified in
following categories:

a. Financial Assets at Amortised Cost

Financial assets are subsequently
measured at amortised cost if these
financial assets are held within a
business model with an objective to
hold these assets in order to collect
contractual cash flows and the
contractual terms of the financial
asset give rise on specified dates to
cash flows that are solely payments
of principal and interest on the
principal amount outstanding. Interest
income from these financial assets is
included in finance income using the
effective interest rate ("EIR") method.
Impairment gains or losses arising on
these assets are recognised in the
Statement of Profit and Loss.

b. Financial Assets Measured at Fair
Value

Financial aseets are measured at fair
value through other comprehensive
income (‘OCI'') if these financial
assets are held with a business model
with an objective to achieve both
by collecting contractual cash flow
and selling financial asset and the
contractual terms of the financial
asset give rise on specified dates to
cash flows that are solely payments of
principal and interest on the principal
amount outstanding. Movements in
the carrying amount are taken through
OCI, except for the recognition of
impairment gains or losses, interest
revenue and foreign exchange gains
and losses which are recognised in the
Statement of Profit and Loss.

In respect of equity investments (other
than for investment in subsidiaries
and associates) which are not held
for trading, the Company has made
an irrevocable election to present
subsequent changes in the fair value
of such instruments in OCI. Such an
election is made by the Company on
an instrument by instrument basis at
the time of transition for existing equity
instruments/ initial recognition for new
equity instruments.

2.10Revenue Recognition:

Revenue from contracts with customers is
recognised when control of the goods or services
are transferred to the customer at an amount
that reflects the consideration to which the
Company expects to be entitled in exchange
for those goods or services. The Company has
concluded that it is principal in its revenue
arrangements, because it typically controls
the goods or services before transferring them
to the customer. The policy of recognizing the
revenue is determined by the five stage model
proposed by Ind AS 115 "Revenue from contract
with customers.

(i) Revenue from the domestic sales is
recognised when the significant risks and
rewards of ownership of the goods have
been passed to the buyer, usually on
delivery of the goods. Revenue from the
sale of goods is measured at the transaction
price of the consideration received or
receivable, net of returns and allowances,
trade discounts and volume rebates.

(ii) Revenue from export sales are recognized
when all the significant risks and rewards
of ownership of the goods have been
passed to the buyer, usually on the basis
of date of Bill of Lading. Export incentives
are accounted for on Export of goods if
the entitlements can be estimated with
reasonable accuracy and conditions
precedent to claim are fulfilled.

(iii) Dividend is recorded in the year in which
right to receive payment is established.

(iv) Interest income is recognized using the
effective interest method.

2.11 Cash Flow Statement:

Cash flows are reported using the indirect
method, whereby net profit before tax is
adjusted for the effects of transactions of a non
cash nature and any deferral or accruals of past
or future cash receipts or payments. The cash
flows from operating, investing and financing
activities of the Company are segregated.

2.12 Cash and cash equivalents:

Cash comprises cash on hand and demand
deposits with bank. Cash equivalents are short
term, highly liquid investments that are readily
convertible into known amounts of cash which
are subject to an insignificant risk of changes
in value.

2.13 Borrowing Costs:

Borrowing Costs directly attributable to the
acquisition, construction or production of
qualifying assets are capitalized till the month
in which the asset is ready to be put to use, as
part of the cost of that asset. Other borrowing
costs are recognized as expenses in the period
in which these are incurred.

2.14 Earnings per share:-

The basic & diluted earning per share is
computed by dividing the net profit or loss
attributable to equity shareholder for the period
by the weighted average number of equity
shares outstanding during the period.

2.15 Impairment of Assets:

The Management assesses for any impairment
of assets or cash generating units, if indicators,
external or internal, suggest possibilities of
reduction in net realisable value of assets or
value in use of cash generating units below their
carrying costs. Impairments, if any, is recognised
in the Profit and Loss Account.

---

Mar 31, 2024

2.Summary of material accounting policies 2.1. Basis of Preparation of Financial Statements:

"These financial statements are prepared in accordance with Indian Accounting Standard (Ind AS), under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values, the provisions of the Companies Act, 2013 (''the Act'') and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendments issued thereafter. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

These financial statements were approved and authorised for issue with the resolution of the Board of Directors on May 30, 2024."

2.2 Use of Estimates

The preparation of financial statements in conformity with the recognition and measurement principles of Ind AS which requires the management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods. Key sources of estimation of uncertainty at the date of the financial statements which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, is in respect of useful lives of property, plant and equipment, provisions and contingent liabilities.

2.3 Property, plant and equipment and depreciation:

i. Since there is no change in the functional currency, the company has elected to continue with the carrying value for all of its property, plant and equipment as recognized in its Indian GAAP financial statements as deemed cost at the transition date viz. April 1, 2016. Property, plant and equipment are stated at their cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets and including cost of specific borrowings. The Property, plant and equipment manufactured internally by the Company are stated at manufacturing cost. Property, plant and equipment are shown net of accumulated depreciation, except free hold and, which is at cost.

ii. Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

iii. Intangible assets are measured on initial recognition at cost. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

iv. Depreciation / Amortization on Assets (other than Freehold Land) :

"Pursuant to enactment of the companies act 2013 (the ''Act''), the company has revised useful life of its Property, plant and equipment as per provision of schedule II of the said act. Accordingly the company provides depreciation on all its assets on the "Straight Line Method" in accordance with the said act. Cost of Power line is being amortized over a period of 7.5 years when put to use."

Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

2.4 Inventories:

i. Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

ii. Cost of Raw materials is ascertained on weighted moving average basis.

iii. Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or net realizable value.

iv. Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or net realizable value.

v. Stock of Trial Product is valued at cost.

vi. Dies, Die Block and Die Steel are valued at material cost.

vii. Goods in transit are stated at actual cost up to the date of Balance Sheet.

2.5 Research & Development costs:

i. Capital Expenditure is included in Fixed Assets & Capital Work in Progress and depreciation is provided at the respective applicable rates.

ii. Revenue expenditure incurred on R&D is included in the respective account heads in the financial

statements.

2.6 Share Issue expenses

Share issue expenses are written off over a period of ten years

2.7 Post employment and other employee benefits:

i. Short terms employee benefits -

Short-term employee benefits such as salaries, wages, performance incentives etc. are recognised as expenses at the undiscounted amounts in the Statement of Profit and Loss of the period in which the related service is rendered. Expenses on non-accumulating compensated absences is recognised in the period in which the absences occur.

ii. Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions and are accounted on accrual basis and charged to statement of profit and loss of the year.

iii. Gratuity -

"The employees'' gratuity fund scheme is Company''s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity fund under cash accumulation policy of the Life Insurance Corporation of India. The Employees'' gratuity, a defined benefit plan, is determined based on valuations, as at the balance sheet date, made by an independent actuary using the Projected Unit Credit Method. Re-measurement, comprising of actuarial gains and losses, in respect of gratuity are recognised in the OCI, in the period in which they occur and is not eligible to be reclassified to the Statement of Profit and Loss in subsequent periods. Past service cost is recognised in the Statement of Profit and Loss in the year of plan amendment or curtailment. The classification of the Company''s obligation into current and non-current is as per the actuarial valuation report.

iv. Privilege Leave Benefits -

Accumulated leave which is expected to be utilised within next twelve months, is treated as short-term employee benefit. Leave entitlement, other than short term compensated absences, are provided based on a actuarial valuation, similar to that of gratuity benefit. Re-measurement, comprising of actuarial gains and losses, in respect of leave entitlement are recognised in the Statement of Profit and Loss in the period in which they occurred.

v. Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme is recognized as liability in the year of termination.

2.8 Foreign Currency Transactions

i. Initial recognition -

The company''s financial statements are presented in INR , which is also its functional currency. Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

ii. Conversion -

Monetary Assets and Liabilities, designated in foreign currencies are revalued at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate. Non-monetary assets and liabilities that are measured in terms of historical cost in foreign currencies are not revalued.

iii. Exchange Differences -

Exchange difference arising on the settlement and conversion on foreign currency transactions is recognized as income or expenses in the year in which it arises.

2.9 Investments and Other Financial Assets:

i. Initial Recongnition

In the case of financial assets, not recorded at fair value through profit or loss (FVPL), financial assets are recognised initially at fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

ii. Subsequent Measurement

For purposes of subsequent measurement, financial assets are classified in following categories:-

i. Financial Assets at Amortised Cost

Financial assets are subsequently measured at amortised cost if these financial assets are held within a business model with an objective to hold these assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Interest income from these financial assets is included in finance income using the effective interest rate ("EIR") method. Impairment gains or losses arising on these assets are recognised in the Statement of Profit and Loss.

ii. Financial Assets Measured at Fair Value

Financial assets are measured at fair value through Other Comprehensive Income (''OCI'') if these financial assets are held within a business model with an objective to hold these assets in order to collect contractual cash flows or to sell these financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognised in the Statement of Profit and Loss.

In respect of equity investments (other than for investment in subsidiaries and associates) which are not held for trading, the Company has made an irrevocable election to present subsequent changes in the fair value of such instruments in OCI. Such an election is made by the Company on an instrument by instrument basis at the time of transition for existing equity instruments/ initial recognition for new equity instruments.

2.10 Revenue Recognition:

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company has concluded that it is principal in its revenue arrangements, because it typically controls the goods or services before transferring them to the customer. The policy of recognizing the revenue is determined by the five stage model proposed by Ind AS 115 "Revenue from contract with customers.

i. Revenue from the domestic sales is recognised when the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on delivery of the goods. Revenue from the sale of goods is measured at the transaction price of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

ii. Revenue from export sales are recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on the basis of date of Bill of Lading. Export incentives are accounted for on Export of goods if the entitlements can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

iii. Dividend is recorded in the year in which right to receive payment is established.

iv. Interest income is recognized using the effective interest method.

2.11 Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated.

2.12 Cash and cash equivalents:

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

2.13 Borrowing Costs:

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to be put to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

2.14 Earnings per share:-for the period by the weighted average number of equity shares outstanding during the period.

2.15 Impairment of Assets:

The Management assesses for any impairment of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, is recognised in the Profit and Loss Account.

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Mar 31, 2018

1. Statement on Significant Accounting Policies

1.1 Basis of Preparation of Financial Statements:

As per notification issued by the Ministry of Corporate Affairs, the financial statements have been prepared in accordance with Indian Accounting standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015. For all periods up to and including the year ended March 31, 2017, the company prepared its financial statements in accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). In accordance with Ind AS 101 First-time adoption of Indian Accounting Standards, the Company has presented a reconciliation from the presentation of financial statements under Accounting standards notified under the Companies (Accounting standards) Rules, 2006 (“Previous GAAP”) to Ind AS. All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle, and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as up to twelve months for the purpose of current/non-current classification of assets and liabilities.

1.2 Use of Estimates

The preparation of financial statements in conformity with the recognition and measurement principles of Ind AS requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods. Key sources of estimation of uncertainty at the date of the financial statements which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, is in respect of useful lives of property, plant and equipment, provisions and contingent liabilities.

1.3 Property, plant and equipment and depreciation:

A) Since there is no change in the functional currency, the company has elected to continue with the carrying value for all of its property, plant and equipment as recognized in its Indian GAAP financial statements as deemed cost at the transition date viz. April 1, 2016. Property, plant and equipment are stated at their cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The Property, plant and equipment manufactured internally by the Company are stated at manufacturing cost. Property, plant and equipment are shown net of accumulated depreciation and impairment losses; except for free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are measured on initial recognition at cost. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

Pursuant to enactment of the Companies Act 2013 (the ‘Act’), the company has revised useful life of its Property, plant and equipment as per provision of schedule II of the said Act. Accordingly the company provides depreciation on all its assets on the “Straight Line Method” in accordance with the said Act.

Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

1.4 Inventories:

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

Cost of Raw materials is ascertained on weighted moving average basis.

Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or net realizable value.

Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or net realizable value.

Stock of Trial Product is valued at cost.

Dies are valued at cost.

Die Block and Die Steel are valued at material cost.

Goods in transit are stated at actual cost up to the date of Balance Sheet.

Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

Management reviews the inventory age listing on a periodic basis. The purpose is to ascertain whether an allowance is required to be made in the financial statements for any obsolete and slow-moving items. Management is satisfied that adequate allowance for obsolete and slow-moving inventories has been made in the financial statements.

1.5 Research & Development costs:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred during development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Assets purchased for Research and Development are treated in the same way as any other asset.

1.6 Post employment and other employee benefits:

Short terms employee benefits - All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay and the same are recognized in the period in which the employee renders the related service. The liabilities are presented under current provisions in the Balance sheet.

Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to statement of profit and loss of the year.

Gratuity -

The employees’ gratuity fund scheme is Company’s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees’ gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation. Now as per Ind AS 19, all Actuarial (gains)/losses will be termed as remeasurements and will be immediately recognized in Other Comprehensive Income on the face of Statement of Profit & Loss.

Privilege Leave Benefits -

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions

Initial recognition -

The company’s financial statements are presented in INR, which is also its functional currency. Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

Conversion -

Monetary Assets and Liabilities, designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet. Non-monetary assets and liabilities that are measured in terms of historical cost in foreign currencies are not retranslated. Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise.

1.9 Investments:

Investments which are readily realizable and are intended to be held for not more than one year from the date on which investments are made are classified as current investments.

1.10 Revenue Recognition:

A) Revenue from the domestic sales is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer.

B) Revenue from export sales are recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on the basis of dates of bill of lading/other delivering documents as per the terms of the contract.

C) Export incentives:

Export incentives are accounted for on export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

D) Revenue from the sale of goods is measured at the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

E) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

F) Interest income is recognized using the effective interest method.

1.11 Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Cash and cash equivalents:

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

1.13 Borrowing Costs:

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

1.14 Taxation:

Current Income Tax:

Income Tax expense or credit for the period is the tax payable on the current period’s taxable income based on the applicable income tax rates adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

Deferred Tax:

Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date.

Deferred Tax liabilities are recognised for all timing differences. Deferred tax assets are recognised for timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

1.15 Earnings per share:-

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders & the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

1.16 Impairment of Assets:

Impairment of financial assets

The Company measures the expected credit loss associated with its assets based on historical trend, industry practices and the business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

Impairment of non-financial assets

Non Financial Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or group of assets (cash-generating units). Non-financial assets that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

1.17 Provisions and contingent liabilities

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. The Company does not recognize a contingent liability but discloses its existence in the financial statements. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

1.18 Government grants

Grants from the Government are recoganised at the fair value where there is reasonable assurance that the grant will be received and the Company will comply with all the attached conditions.

When loans or similar assistance are provided by governments or related institutions, with an interest rate below the current applicable market rate, the effect of this favourable interest is regarded as a government grant. The loan or assistance is initially recognised and measured at fair value and the government grant is measured as the difference between the fair value and initial carrying value of the loan. The loan is subsequently measured as per the accounting policy applicable to financial liabilities.

1.21 Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Equity Investments

All equity investments in scope of Ind AS 109 are measured at amortised cost. For all equity instruments not held for trading, the Company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument-by-in-strument basis.

The classification is made on initial recognition and is irrevocable.

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Mar 31, 2017

1.1 Basis of Preparation of Financial Statements:

The financial statements have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on an accrual basis in compliance with all material aspect of the Accounting Standard (AS) Notified under section 133 of the Companies Act, 2013 read together with paragraph 7 of the Companies (Accounts) Rules 2014. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for the change in accounting policy explained in paragraph II below

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle, and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as up to twelve months for the purpose of current/non-current classification of assets and liabilities.

1.2 Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation:

a) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

b) Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

c) Intangible assets are recorded at the consideration paid for acquisition. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

d) Depreciation / Amortization on Assets (other than Freehold Land):

Pursuant to enactment of the companies act 2013 (the ‘Act’), the company has revised useful life of its fixed assets as per provision of schedule II of the said act. Accordingly the company provides depreciation on all its assets on the “straight Line Method” in accordance with the said act.

Cost of Power line is being amortized over a period of seven years when put to use.

Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

1.4 Inventories:

a) Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

b) Cost of Raw materials, Stores, Spares etc. are ascertained on weighted moving average basis.

c) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realizable value.

d) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at cost.

e) Stock of Trial Product is valued at cost.

f) Dies are valued at cost.

g) Die Block and Die Steel are valued at material cost.

h) Goods in transit are stated at actual cost up to the date of Balance Sheet.

i) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research& Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits:

a) Short term employee benefits

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity -

The employees’ gratuity fund scheme is Company’s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees’ gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Privilege Leave Benefits -

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions

a) Initial recognition -

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion -

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences -

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise.

d) Option Contracts -

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose. Outstanding foreign exchange option contracts on the date of Balance Sheet are “Marked to Market”.

1.9 Investments:

Investments which are readily realizable and are intended to be held for not more than one year from the date on which investments are made are classified as current investments. Such investments are stated at cost, adjusted for diminution in their value.

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Revenue Recognition:

a) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

b) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

c) Export incentives:

Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Cash and cash equivalents:

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

1.13 Borrowing Costs:

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

1.14 Taxation:

a) Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

b) Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.15 Earnings per share:-

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.16 Impairment of Assets:

The Management assesses for any impairment of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realizable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognized in the Profit and Loss Account.

1.17 Provisions and Contingent Liability:-

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

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Mar 31, 2016

1. Statement on Significant Accounting Policies :

1.1 Basis of Preparation of Financial Statements :

The financial statements have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on an accrual basis in compliance with all material aspect of the Accounting Standard (AS) Notified under section 133 of the Companies Act, 2013 read together with paragraph 7 of the Companies (Accounts) Rules 2014. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for the change in accounting policy explained in paragraph II below

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle, and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as up to twelve months for the purpose of current/non-current classification of assets and liabilities.

1.2 Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation:

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are recorded at the consideration paid for acquisition. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

(i) Pursuant to enactment of the Companies Act, 2013 (the ‘Act’), the company has revised useful life of its fixed assets as per provision of schedule II of the said act. Accordingly the company provides depreciation on all its assets on the “Straight Line Method” in accordance with the said act.

(ii) Cost of Power line is being amortized over a period of seven years when put to use.

(iii) Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

1.4 Inventories:

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Cost of Raw materials, Stores, Spares etc. are ascertained on weighted moving average basis.

ii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realizable value.

iii) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or estimated realizable value.

iv) Stock of Trial Product is valued at cost.

v) Dies are valued at cost.

vi) Die Block and Die Steel are valued at material cost.

vii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

viii) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research & Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits:

a) Short terms employee benefits.

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity -

The employees’ gratuity fund scheme is Company’s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees’ gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Privilege Leave Benefits:

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits :-

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions

a) Initial recognition -

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion -

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences: -

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise. Except , option of capitalizing of eligible exchange difference on foreign currency loans utilized for acquisition of assets is availed as per Ministry of Corporate Affairs Notification dated 31 March 2009, as amended vide G.S.R. 378(E) dated 11 May 2011and extension thereof.

d) Option Contracts -

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose.

Outstanding foreign exchange option contracts on the date of Balance Sheet are “Marked to Market”.

1.9 Investments:

Investments which are readily realizable and are intended to be held for not more than one year from the date on which investments are made are classified as current investments. Such investments are stated at cost, adjusted for diminution in their value.

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Revenue Recognition:

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to

property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

b) Benefit on account of entitlement to import goods free of duty under the “Duty Entitlement Pass Book under Duty Exemption Scheme” is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Cash Flow Statement:

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Cash and cash equivalents:

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

1.13 Borrowing Costs:

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

1.14 Taxation:

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.15 Earnings per share:-

The basic & diluted earnings per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.16 Impairment of Assets:

The Management assesses for any impairment of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realizable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognized in the Profit and Loss Account.

1.17 Provisions and Contingent Liability:-

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

---

Mar 31, 2015

1.1 Basis of Preparation of Financial Statements :

The financial statements are prepared under the historical cost convention on an accrual basis in accordance with the generally accepted accounting principles and comply with the Accounting Standards as per the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 2013.

Revised Schedule VI notified under the Companies Act, 2013 have became applicable to the Company from accounting year commencing from 01.04.2011 for preparation and presentation of Financial Statements. Accordingly all Assets and Liabilities have been classified as Current and Non Current as per Company's Normal operating cycle and/or other criteria's set out in revised schedule VI.

1.2 Use of Estimates :

The preparation of financial statements is in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation :

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are recorded at the consideration paid for acquisition. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

i) Pursuant to enactment of the companies act 2013 (the 'Act'), the company has revised useful life of its fixed assets as per provision of schedule II of the said act. Accordingly the company provides depreciation on all its assets on the "Straight Line Method" in accordance with the said act.

ii) Cost of Power line is being amortized over a period of seven years when put to use.

iii) Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

Consequently enactment of said provisions carrying value of assets whose life has been completed as at 1st April 2014 aggregating to Rs. 310.16 lacs (net of deferred tax) has been adjusted to the surplus account and in other cases the same has been depreciated over the remaining revised life of the assets. As a result depreciation charge is higher by Rs. 24.89 lacs for the year ended 31st March 2015.

1.4 Inventories :

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Cost of Raw materials, Stores, Spares etc. are ascertained on weighted moving average basis.

ii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realizable value.

iii) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or estimated realizable value.

iv) Stock of Trial Product is valued at cost.

x) Dies are valued at cost.

vi) Die Block and Die Steel are valued at material cost.

vii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

viii) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research & Development expenditure :

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits :

a) Short terms employee benefits.

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund :

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity :

The employees' gratuity fund scheme is Company's defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees' gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Privilege Leave Benefits :

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits :

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions :

a) Initial recognition :

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion :

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalued at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences :

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise. Except, option of capitalizing of eligible exchange difference on foreign currency loans utilized for acquisition of assets is availed as per Ministry of Corporate Affairs Notification dated 31 March 2009, as amended vide G.S.R. 378(E) dated 11 May 2011and extension thereof.

d) Option Contracts :

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose.

Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

1.9 Investments :

Investments which are readily realizable and are intended to be held for not more than one year from the date on which investments are made are classified as current investments. Such investments are stated at cost, adjusted for diminution in their value.

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Revenue Recognition :

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under Duty Exemption Scheme" is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Cash Flow Statement :

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Cash and cash equivalents :

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

1.13 Borrowing Costs :

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

1.14 Taxation :

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.15 Earnings per share :

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.16 Impairment of Assets :

The Management assesses for any impairement of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

1.17 Provisions and Contingent Liability :

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

---

Mar 31, 2014

1.1 Basis of Preparation of Financial Statements :

The financial statements are prepared under the historical cost convention on an accrual basis in accordance with the generally accepted accounting principles and comply with the Accounting Standards as per the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

Revised Schedule VI notified under the Companies Act, 1956 have become applicable to the Company from accounting year commencing from 01.04.2011 for preparation and presentation of Financial Statements. Accordingly all Assets and Liabilities have been classified as Current and Non Current as per Company''s Normal operating cycle and/or other criteria set out in revised schedule VI.

1.2 Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation :

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc. :

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are recorded at the consideration paid for acquisition. Expenditure incurred in development phase, where it is reasonably certain that outcome of development will be commercially exploited to yield future economic benefit to the company is considered as an intangible asset. Such developmental expenditure is capitalized at cost including share of allocable expenses.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

i) The Company provides depreciation on all its assets on the "Straight Line Method" (three shift basis) in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956.

ii) Depreciation on all assets acquired upto 31st October, 1987 is being provided at the rates of depreciation prevalent at the time of acquisition of the asset, pursuant to Circular 1/1/ 86 CLB No. 14(50)84 CL-VI dated 21st May,1986 issued by the Department of Company Affairs.

iii) Depreciation on addition to fixed assets from 1st April, 1990 onwards is charged at the rates specified in and in accordance with, Schedule XIV of the Companies Act, 1956.

iv) Depreciation on additions on account of increase in rupee value due to foreign exchange fluctuations is being provided at the rates of depreciation over the balance life of the said asset.

v) Depreciation on assets sold, discarded and scrapped is being provided at their rates on pro-rata basis up to the date on which such assets are sold, discarded and scrapped.

vi) Cost of Powerline is being amortised over a period of seven years when put to use.

vii) Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use.

1.4 Inventories :

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower. Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Cost of Raw materials, Stores, Spares etc. are ascertained on weighted moving average basis.

ii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realizable value.

iii) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or estimated realizable value.

iv) Stock of Trial Product is valued at cost.

v) Dies are valued at cost.

vi) Die Block and Die Steel are valued at material cost.

vii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

viii) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research & Development expenditure :

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits :

a) Short term employee benefits -

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc. and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity -

The employees'' gratuity fund scheme, is Company''s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees'' gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Privilege Leave Benefits -

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions :

a) Initial recognition for the year -

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion -

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences -

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise. Except, option of capitalizing of eligible exchange difference on foreign currency loans utilized for acquisition of assets is availed as per Ministry of Corporate Affairs Notification dated 31st March 2009, as amended vide G.S.R. 378(E) dated 11th May 2011 and extension thereof.

d) Option Contracts -

Company uses foreign exchange option contracts to hedge its exposure against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose.

Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

1.9 Investments :

Investments which are readily realizable and are intended to be held for not more than one year from the date on which investments are made are classified as current investments. Such investments are stated at cost, adjusted for diminution in their value.

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Revenue Recognition :

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under Duty Exemption Scheme" is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Cash Flow Statement :

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Cash and cash equivalents :

Cash comprises cash on hand and demand deposits with bank. Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value.

1.13 Borrowing Costs :

Borrowing Costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized till the month in which the asset is ready to use, as part of the cost of that asset. Other borrowing costs are recognized as expenses in the period in which these are incurred.

1.14 Taxation :

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.15 Earnings per share :

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.16 Impairment of Assets :

The Management assesses for any impairement of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

1.17 Provisions and Contingent Liability :

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

---

Mar 31, 2013

1.1 Basis of Preparation of Financial Statements :

The financial statements are prepared under the historical cost convention on an accrual basis in accordance with the generally accepted accounting principles and comply with the Accounting Standards as per the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

Revised Schedule VI notified under the Companies Act, 1956 have became applicable to the Company from accounting year commencing from 01.04.2011 for preparation and presentation of Financial Statements. Accordingly all Assets and Liabilities have been classified as Current and Non Current as per Company''s Normal operating cycle and/or other criteria''s set out in revised schedule VI.

1.2 Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation :

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc :- In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are recorded at the consideration paid for acquisition.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

i) The Company provides depreciation on all its assets on the "Straight Line Method" in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956;

ii) Depreciation on all assets acquired upto 31st October, 1987 is being provided at the rates of depreciation prevalent at the time of acquisition of the asset, pursuant to Circular 1/1/86 CLB No. 14(50)84 CL-VI dated 21st May,1986 issued by the Department of Company Affairs ;

iii) Depreciation on addition to fixed assets from 1st April, 1990 onwards is charged at the rates specified in and in accordance with, Schedule XIV of the Companies Act, 1956;

iv) Depreciation on additions on account of increase in rupee value due to foreign exchange fluctuations is being provided at the rates of depreciation over the balance life of the said asset.

v) Depreciation on assets sold, discarded and scrapped is being provided at their rates on pro-rata basis up to the date on which such assets are sold, discarded and scrapped.

vi) Cost of Powerline is being amortised over a period of seven years when put to use.

vii) Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use .

1.4 Inventories :

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Cost of Raw materials, Stores, Spares etc are ascertained on weighted moving average basis.

ii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realizable value.

iii) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at the lower of cost or estimated realizable value.

iv) Stock of Trial Product is valued at cost.

v) Dies are valued at cost.

vi) Die Block and Die Steel are valued at material cost.

vii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

viii) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research & Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits :

a) Short terms employee benefits.

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex-gratia, performance pay etc and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity –

The employees'' gratuity fund scheme, is Company''s defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees'' gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Superannuation:- Defined Contributions to Life Insurance Corporation of India for employees covered under Superannuation Scheme are accounted at the rate of 15% of such employees'' annual salary.

e) Privilege Leave Benefits :

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

f) Termination Benefits :–

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions

a) Initial recognition –

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion –

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences: -

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise. Except, option of capitalizing of eligible exchange difference on foreign currency loans utilized for acquisition of assets is availed as per Ministry of Corporate Affairs Notification dated 31 March 2009, as amended vide G.S.R. 378(E) dated 11 May 2011and extension thereof.

d) Option Contracts –

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose.

Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

1.9 Investments:

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Revenue Recognition :

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under Duty Exemption Scheme" is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Cash Flow Statement :

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature and any deferral or accruals of past or future cash receipts or payments. The cash flows from regular operating, investing and financing activities of the Company are segregated.

1.12 Borrowing Costs :

Borrowing costs are recognised in the Profit and Loss Account except interest incurred on borrowings, specifically raised for projects, are capitalized to the cost of the qualifying assets until such time that the asset is ready to be put to use for its intended purpose.

1.13 Taxation :

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.14 Earnings per share :

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.15 Impairment of Assets :

The Management assesses for any impairement of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

1.16 Provisions and Contingent Liability :

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

---

Mar 31, 2012

1.1 Basis of Preparation of Financial Statements :

The financial statements are prepared under the historical cost convention on an accrual basis in accordance with the generally accepted accounting principles and comply with the Accounting Standards as per the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

Revised Schedule VI notified under the Companies Act, 1956 have became applicable to the Company from accounting year commencing from 01.04.2011 for preparation and presentation of Financial Statements. Accordingly all Assets and Liabilities have been classified as Current and Non Current as per Company's Normal operating cycle and/or other criteria's set out in revised schedule VI.

1.2 Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying financial statements are based upon management's evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from the estimates and assumptions used in preparing the accompanying financial statements. Any revisions to accounting estimates are recognized prospectively in future periods.

1.3 Fixed Assets and depreciation:

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Intangible assets are recorded at the consideration paid for acquisition.

D) Depreciation / Amortization on Assets (other than Freehold Land) :

i) The Company provides depreciation on all its assets on the "Straight Line Method" in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956;

ii) Depreciation on all assets acquired upto 31st October, 1987 is being provided at the rates of depreciation prevalent at the time of acquisition of the asset, pursuant to Circular 1/1/86 CLB No. 14 (50) 84 CL-VI dated 21st May,1986 issued by the Department of Company Affairs ; dated 21st May,1986 issued by the Department of Company Affairs ;

iii) Depreciation on addition to fixed assets from 1st April, 1990 onwards is charged at the rates specified in and in accordance with, Schedule XIV of the Companies Act, 1956;

iv) Depreciation on additions on account of increase in rupee value due to foreign exchange fluctuations is being provided at the rates of depreciation over the balance life of the said asset.

v) Depreciation on assets sold, discarded and scrapped is being provided at their rates on pro-rata basis up to the date on which such assets are sold, discarded and scrapped.

vi) Cost of Powerline is being amortised over a period of seven years when put to use.

vii) Intangible assets are amortized over their respective individual estimated useful lives on a straight line basis, commencing from the date the asset is available to the Company for its intended use .

1.4 Inventories:

Stores and spares, raw materials and components are valued at cost or net realizable value whichever is lower, Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Raw materials are valued at cost. The costs are ascertained on moving average basis.

ii) Stores, Spares etc. and tools are valued on moving average basis.

iii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realisable value.

iv) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at estimated realisable value.

v) Stock of Trial Product is valued at cost.

vi) Dies are valued at cost.

vii) Die Block and Die Steel are valued at material cost.

viii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

ix) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

1.5 Research & Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

1.6 Share Issue expenses are written off over a period of ten years.

1.7 Employee Benefits:

a) Short term employee benefits.

All employee benefits payable within 12 months of rendering the service are classified as short term benefits. Such benefits include salary, wages, bonus, short term compensated absences, awards, ex- gratia, performance pay etc and the same are recognized in the period in which the employee renders the related service.

b) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to profit and loss account of the year.

c) Gratuity -

The employees' gratuity fund scheme, is Company's defined benefit plan. Payment for present liability of future payment of gratuity is being made to the approved gratuity funds under cash accumulation policy of the Life Insurance Corporation of India. The Employees' gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

d) Superannuation-

Defined Contributions to Life Insurance Corporation of India for employees covered under Superannuation Scheme are accounted at the rate of 15% of such employees' annual salary.

e) Privilege Leave Benefits:

Privilege leave benefits or compensated absences are considered as long term unfunded benefit and is recognized on the basis of an actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

f) Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

1.8 Foreign Currency Transactions

a) Initial recognition -

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion -

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences: -

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognized as income or as expenses in the year in which they arise. Except , option of capitalizing of eligible exchange difference on foreign currency loans utilized for acquisition of assets is availed as per Ministry of Corporate Affairs Notification dated 31st March, 2009, as amended vide G.S.R. 378(E) dated 11th May, 2011.

d) Option Contracts -

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose.

Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

1.9 Investments:

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

1.10 Sales:

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading/ Other delivering documents as per terms of contract.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under Duty Exemption Scheme" is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

1.11 Borrowing Costs:

Borrowing costs are recognised in the Profit and Loss Account except interest incurred on borrowings, specifically raised for projects, are capitalized to the cost of the qualifying assets until such time that the asset is ready to be put to use for its intended purpose.

1.12 Taxation:

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.13 Earnings per share:

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

1.14 Impairment of Assets:

The Management assesses for any impairment of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

1.15 Provisions and Contingent Liability:

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

---

Mar 31, 2011

1. System of Accounting:

The financial statements are prepared under the historical cost convention on an accrual basis in accordance with the generally accepted accounting principles and comply with the Accounting Standards as per the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

Estimates and Assumptions used in the preparation of the financial statements are based upon managements evaluation of the relevant facts and circumstances as of the date of Financial Statements, which may differ from the actual results at a subsequent date.

2. Fixed Assets and depreciation:

A) Fixed Assets are stated at their original cost of acquisitions including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during the construction etc:-

In case of new projects and in case of substantial modernization or expansion at the existing units of the company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalized to the cost of asset. Trial run expenditure is also capitalized.

C) Depreciation on Assets (other than Freehold Land):

i) The Company provides depreciation on all its assets on the "Straight Line Method" in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956;

ii) Depreciation on all assets acquired upto 31st October, 1987 is being provided at the rates of depreciation prevalent at the time of acquisition of the asset, pursuant to Circular 1/1/86 CLB No. 14(50)84 CL-VI dated 21st May, 1986 issued by the Department of Company Affairs;

iii) Depreciation on addition to fixed assets from 1st April, 1990 onwards is charged at the rates specified in and in accordance with, Schedule XIV of the Companies Act, 1956;

iv) Depreciation on additions on account of increase in rupee value due to foreign exchange fluctuations ix being provided at the rates of depreciation over the balance life of the said asset.

v) Depreciation on assets sold, discarded and scrapped is being provided at their rates on pro-rata basis up to the date on which such assets are sold, discarded and scrapped.

vi) Cost of Powerline is being amortised over a period of seven years when put to use.

3. Inventories:

Cost of Inventories has been computed to include all cost of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Raw materials are valued at cost. The costs are ascertained on moving average basis.

ii) Stores, Spares etc. and tools are valued on moving average basis.

iii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realisable value.

iv) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at estimated realisable value.

v) Stock of Trial Product is valued at cost.

vi) Dies are valued at cost.

vii) Die Block and Die Steel are valued at material cost. viii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

ix) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

4. Research & Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

5. Share Issue expenses are written off over a period of ten years.

6. Technical Know how Fees are written off over a period of six years.

7. Employee Benefits:

a) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to Profit and Loss Account of the year.

b) Gratuity-

Payment for present liability of future payment of gratuity is being made to approved gratuity funds which fully cover the same under cash accumulation policy of the Life Insurance Corporation of India. The employees gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

c) Superannuation -

Defined Contributions to Life Insurance Corporation of India for employees covered under Superannuation Scheme are accounted at the rate of 15% of such employees annual salary.

d) Privilege Leave Benefits -

Privilege leave benefits or compensated absences is considered as long term unfunded benefit and is recognized on the basis of a actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits -

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

8. Foreign Currency Transactions:

a) Initial recognition-

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion-

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate.

c) Exchange Differences-

Exchange difference arising on the settlement and conversion on foreign currency transactions are recognised as income or as expenses in the year in which they arise.

d) Though the accounting policy detailed in (a) to (c) above have been consistently followed in terms with the Accounting Standard 11, the company has opted the option to capitalize the difference on some of the fixed assets as per notification issued by the Minister/ of Corporate Affairs.

e) Option Contracts-

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose. Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

9. Investments:

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

10. Sales:

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book under Duty Exemption Scheme" is accounted in the year of Export.

c) Export incentives: Export incentives are accounted for on Export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

11. Borrowing Costs:

Borrowing costs are recognised in the Profit and Loss Account except interest incurred on borrowings, specifically raised for projects, are capitalized to the cost of the qualifying assets until such time that the asset is ready to be put to use for its intended purpose.

12. Taxation:

Current tax is determined on the basis of taxable income computed in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax is recognized, subject to the consideration of prudence in respect of deferred tax asset, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

13. Earning Per Share:-

The basic & diluted earning per share is computed by dividing the net profit or loss attributable to equity shareholder for the period by the weighted average number of equity shares outstanding during the period.

14. Impairment of Assets:

The Management assesses for any impairement of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

15. Provisions and Contingent Liability:-

Provisions are recognized when the company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are determined based on the best estimate required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to reflect current best estimates. A disclosure of contingent liability is made where there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

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Mar 31, 2010

1. System of Accounting:

i) The Company, generally, follows the mercantile system of accounting and recognizes income and expenditure on an accrual basis except those with significant uncertainties.

ii) Financial statements are based on historical cost. These costs are not adjusted to reflect the impact of the changing value in the purchasing power of money.

iii) Estimates and Assumptions used in the preparation of the financial statements are based upon managements evaluation of the relevant facts and circumstances as on the date of Financial Statements, which may differ from the actual results at a subsequent date.

2. Fixed Assets and depreciation:

A) Fixed Assets are stated at their original cost of acquisition including incidental expenses related to acquisition and installation of the concerned assets (including cost of specific borrowings). The fixed assets manufactured by the Company are stated at manufacturing cost. Fixed Assets are shown net of accumulated depreciation, except free hold land, which is at cost.

B) Expenditure on New Projects and Expenditure during Construction etc.:

In case of new projects and in case of substantial modernization or expansion at the existing units of the Company, expenditure incurred including interest on borrowings and financing cost of specific loan, prior to the commencement of commercial production is being capitalised to cost of assets. Trial Run Expenditure is also capitalised.

D) Depreciation on Assets (other than Freehold Land):

i) The Company provides depreciation on all its assets on the "Straight Line Method" in accordance with the provisions of Section 205(2)(b) of the Companies Act, 1956.

ii) Depreciation on all assets acquired upto 31st October, 1987 is being provided at the rates of depreciation prevalent at the time of acquisition of the asset, pursuant to Circular 1/1/86 CLB No. 14(50)84 CL-VI dated 21 st May, 1986 issued by the Department of Company Affairs.

iii) Depreciation on addition to fixed assets from 1st April, 1990 onwards is charged at the rates specified in and in accordance with, Schedule XIV of the Companies Act, 1956.

iv) Depreciation on additions on account of increase in rupee value due to foreign exchange fluctuations is being provided at the rates of depreciation over the balance life of the said asset.

v) Depreciation on assets sold, discarded and scrapped is being provided at their rates on pro-rata basis up to the date on which such assets are sold, discarded and scrapped.

vi) Cost of Powerline is being amortised over a period of seven years when put to use.

3. Inventories:

Cost of Inventories has been computed to include all costs of purchases, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

i) Raw materials are valued at cost. The costs are ascertained on weighted average basis.

ii) Stores, Spares etc. and tools are valued on weighted average basis.

iii) Work-in-process, Dies under fabrication and Finished Goods are valued at the lower of cost or realisable value.

iv) Scrap and Non-moving semi-finished goods, slow-moving and obsolete items, are valued at estimated realisable value.

v) Stock of Trial Product is valued at cost.

vi) Dies are valued at cost.

vii) Die Block and Die Steel are valued at material cost.

viii) Goods in transit are stated at actual cost up to the date of Balance Sheet.

ix) Shares, Units of Mutual Funds shown as stock in trade are valued at cost or market value whichever is lower.

4. Research & Development expenditure:

Research and Development expenditure is charged to Profit & Loss Account under the respective heads of account in the year in which it is incurred. However expenditure incurred at development phase, where it is reasonably certain that the outcome of research will be commercially exploited to yield economic benefit to the Company, is considered as an intangible asset. Fixed Assets purchased for Research and Development are treated in the same way as any other Fixed Asset.

5. Deferred Revenue Expenditure is written off over a period of ten years from the date of commencement of Commercial Production.

6. Share Issue expenses are written off overa period of ten years.

7. Technical Know how Fees are written off over a period of six years.

8. Employee Benefits:

a) Provident Fund -

Benefits in the form of Provident Fund and Pension Scheme whether in pursuance of law or otherwise which are defined contributions is accounted on accrual basis and charged to Profit and Loss Account of the year.

b) Gratuity-

Payment for present liability of future payment of gratuity is being made to approved gratuity funds which fully cover the same under cash accumulation policy of the Life Insurance Corporation of India. The employees gratuity, a defined benefit plan, is determined based on the actuarial valuation using the Projected Unit Credit Method as at the date of the Balance Sheet and shortfall in the fair value of the Planned Asset is recognized as obligation.

c) Superannuation -

Defined Contributions to Life Insurance Corporation of India for employees covered under Superannuation Scheme are accounted at the rate of 15% of such employees annual salary.

d) Privilege Leave Benefits -

Privilege leave benefits or compensated absences is considered as long term unfunded benefit and is recognized on the basis of a actuarial valuation using the Projected Unit Credit Method determined by an appointed Actuary.

e) Termination Benefits-

Termination benefits such as compensation under voluntary retirement scheme are recognized as liability in the year of termination.

9. Foreign Currency Transactions:

a) Initial recognition-

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of transaction.

b) Conversion -

Current Assets and Current Liabilities, Secured Loans designated in foreign currencies are revalorized at the rate prevailing on the date of Balance Sheet or forward contract rate or other appropriate contracted rate. Foreign Currency Exposure in respect of Long Term Foreign Currency Monetary Items, for financing fixed assets, outstanding at the close of the financial year are revolarised at the contracted rate or appropriate exchange rates at the close of the year.

c) Exchange Differences -

The gain or loss due to decrease / increase in Rupee liability due to fluctuation in rate of exchange is recognized in the Profit and Loss Account.

d) Though the accounting policy detailed in (a) to (c) above have been consistently followed in terms with Accounting Standard 11, the policy followed in the current year retrospectively w.e.f. 1 st April 2007, has been overridden by an amendment to the aforementioned Accounting Standard for limited period of time as stated in Note No. 20 in schedule 14 to the Financial Statements.

e) Option Contracts -

Company uses foreign exchange option contracts to hedge its exposures against movements in foreign exchange rates. Foreign exchange option contracts are not used for trading or speculation purpose. Outstanding foreign exchange option contracts on the date of Balance Sheet are "Marked to Market".

10. Investments:

Long Term investments are valued at cost of acquisition less diminution in the value, if determined to be of permanent nature.

11. Sales:

a) i) Domestic sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

ii) Export sales are accounted on the basis of the dates of Bill of Lading.

b) Benefit on account of entitlement to import goods free of duty under the "Duty Entitlement Pass Book" under Duty Exemption Scheme is accounted in the year bf export.

c) Export incentives: Export incentives are accounted for on export of goods if the entitlement can be estimated with reasonable accuracy and conditions precedent to claim are fulfilled.

d) Dividend is accrued in the year in which it is declared, whereby right to receive is established.

12. Borrowing Costs:

Borrowing costs are recognised in the Profit and Loss Account except interest incurred on borrowings, specifically raised for projects, are capitalised to the cost of the assets until such time that the asset is ready to be put to use for its intended purpose.

13. Taxation:

Provision for Taxation is made on the basis of the taxable profits computed for the current accounting period in accordance with the Income Tax Act, 1961. Deferred Tax resulting from timing difference between Book Profits and Tax Profits is accounted for at the applicable rate of tax to the extent the timing differences are expected to crystalise, in case of Deferred Tax Liabilities with reasonable certainty and in case of Deferred Tax Assets with virtual certainty that there would be adequate future taxable income against which deferred tax assets can be realized.

14. Impairment of Assets:

The Management assesses for any impairement of assets or cash generating units, if indicators, external or internal, suggest possibilities of reduction in net realisable value of assets or value in use of cash generating units below their carrying costs. Impairments, if any, will be recognised in the Profit and Loss Account.

15. Provisions:

Necessary provisions are made for present obligations that arise out of past events prior to the Balance Sheet date, entailing future outflow of economic resources. Such provisions reflect best estimates based on available information.