Accounting Policies of Lords Chemicals Ltd. Company

Mar 31, 2011

1. Accounting Convention :

The Financial Statements have been prepared under historical cost convention and on accrual basis, except other wise stated, in accordance with the Generally Accepted Accounting Principles, to comply in all material respects with the notified Companies Accounting Standard Rules, 2006 and the provisions of the Companies Act, 1956.

2. Use of Estimates :

The preparation of the Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets & liabilities as at the date of the financial statements and reported amount of income and expenses during the period.

3. Fixed Assets :

All fixed assets are valued at historical cost inclusive of freight incurred, duties & taxes (net of Cenvat) and incidental expenses less accumulated depreciation. The cost of fixed assets comprises purchase price and all other attributable costs of bringing the assets to working condition for intended use.

Expenditure for addition, improvement and renewal are capitalized and expenditure for maintenance and repairs are charged to the Profit & Loss Account.

4. Depreciation :

Depreciation on fixed assets has been provided for on the basis of written down value method as per useful lives estimated by the management or at the rates and in the manner prescribed under Schedule XIV (as amended) of the Companies Act, 1956, whichever is higher.

5. Impairment of Assets :

An asset is considered as impaired in accordance with Accounting Standard - 28 on Impairment of Assets when at balance sheet date there are indications of impairment and the carrying amount of the asset, or where applicable the cash generating unit to which the asset belongs, exceeds its recoverable amount (i.e. the higher of the asset's net selling price and value in use). The carrying amount is reduced to the recoverable amount and the reduction is recognized as an impairment loss in the profit and loss account.

6. Revenue Recognition :

i) Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

ii) Revenue from Sale of goods and services rendered is recognized upon passage of title and significant risk & reward and rendering of services, to the customers. Sales are accounted for on the basis of ex-works delivery.

iii) Insurance and other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Borrowing Costs :

Borrowing costs attributable to acquisition of fixed assets are treated as part of cost of such assets and capitalized upto the stage of commercial production. All other borrowing costs are charged to revenue in the period in which they are incurred.

8. Provisions :

A provision is recognized when an enterprise has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.

9. Inventories : -

i. Finished products are valued at lower of cost on annual average basis and net realizable value.

ii. Raw materials, Stores and Spares are valued at lower of cost computed on FIFO basis and net realizable value.

iii. The valuation is net of amounts written off for obsolescence.

iv. Cost of inventories comprises of all costs of purchase, cost of conversion, and other costs incurred in bringing them to their respective present location and condition.

10. Excise Duty :

The purchase cost of raw materials has been considered net of CENVAT. Purchase of capital goods is also considered net of CENVAT credit.

11. Earnings Per Share :

The Company reports Basic and Diluted earnings per equity share in accordance with the AS - 20 on Earning per Share. Basic Earnings per share is calculated by dividing the net profit or loss after tax for the period attributable to equity shareholders, by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earnings per share, the net profit or loss after tax for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

12. Employees' Benefits :

Company's contribution to Provident Fund and Employees State Insurance are charged to profit & loss account. Gratuity and other retirement benefits are accounted for by the company on cash basis.

13. Foreign Currency Transactions :

i. Revenue items of foreign currency are accounted for at the rate prevailing on the date of transaction.

ii. Monetary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year-end rates.

iii. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit & loss account except in cases when they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

14. Derivative Instrument :

As per the ICAI Announcement, accounting for derivative contracts, other than those covered under AS-11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effect on the underlying hedge item is charged to the income statement. Net gains are ignored.

15. Taxation :

Provision for income tax comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing difference 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.

16. Contingencies :

Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed by way of Notes to the Accounts. Contingent Assets are neither recognized nor disclosed in the financial statements.

17. Cash Flow Statements :

The Cash Flow Statement is prepared by the indirect method set out in AS -3 on Cash Flow Statements and presents the cash flows from operating, investing and financing activities of the Company.

18. Investments :

Current investments are carried at the lower of cost or quoted/ fair value. Long term investments are stated at cost of acquisition. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

19. Government Grants/Subsidies :

Government grants/ Subsidies are recognized when there is reasonable certainty that the same will be received. Revenue grants are recognized in the Profit & Loss Account either as income or deducted from related expenses. Capital grants/ subsidies are credited to respective fixed assets where it relates to specific fixed assets. Other grants / subsidies are credited to capital reserve.

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Mar 31, 2010

1. Accounting Convention:

The Financial statements have been prepared under historical cost convention and on accrual basis, except other wise stated, in accordance with the Generally Accepted Accounting Principles, to comply in all material respects with the notified Companies Accounting Standard Rufes, 2006 and the provisions of the Companies Act, 1956.

2. Use of Estimates:

The preparation of financial statements requires management to make certain estimates and assumptions that affect. the amounts reported in the financial statements and notes thereto.

3. Fixed Assets:

All fixed assets are valued at cost rtdusive of freight incurred, duties & taxes (net of Can vat) and incidental expenses less accumulated depreciation. The cost of fixed assets comprises purchase price and all other attributable costs of bringing the assets to working condition for intended use, Expenditure for addition, improvement and renewal are capitalized and expenditure tor maintenance and repairs are charged to the Profit & Loss Account

4. Depreciation:

Depreciation on fixed assets has been provided for on the basis of written down value method as per useful lives estimated by the management or at the rates and in the manner prescribed under Schedule XIV (as amended) of the Companies Act, 1956d whichever is higher

5. Impairment of Assets :

An asset is treated as impaired when the carrying cost of assets exceeds Its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The recoverable amount is the greater of net selling price and value in use.

6. Revenue Recognition:

I) Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

ii) Revenue from Sale of goods and services rendered is recognized upon passage of title and significant risk & reward and rendering of services, to the customers. Sales are accounted for on trie basis of ex-works delivery,

iii) Insurance and other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis,

7. Borrowing Costs;

Borrowing costs attributable to acquisition of fixed assets are treated as part of cost of such assets and capitalized upto the stage of commercial production. All other borrowing costs are charged to revenue in the period in which they are incurred.

8. Provisions:

A provision is recognized when an enterprise has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made,

9. inventories:

i) Finished products are valued at lower of cost on annual average basis and net realizable value,

ii) Raw materials, Stores and Spares are valued at lower of cost computed on FIFO basis and net realizable value.

iii) The valuation is net of amounts written off for obsolescence.

iv) Cost of inventories comprises of aII costs of purchase, cost of conversion and other costs incurred in bringing them to their respective present location and condition.

10. Excise Duty:

The purchase cost of raw materials has been considered net of CENVAT. Purchase of capital goods is also considered net of CENVAT credit.

11. Earning Per Share :

Basic Earning per share is catenated by dividing the net profit or loss for the period attributable to equity shareholders, by the weighted average number of equity shares outstanding during the period, For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributabfe to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

12. EmpJoyeeV Benefits:

Companys contribution to Provident Fund and Employees State Insurance are charged to Profit & Loss Account- Gratuity and other retirement benefits are accounted for by the company on cash basis,

13. Foreign Currency Transactions:

i) Revenue ftems of foreign currency are accounted for at the rate prevailing on the date of transaction.

ii) Monetary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year-end rates.

iii) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit & Loss Account except in cases when they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets,

14. Derivative Instrument:

As per the ICAI Announcement. accounting for derivative contracts, other than those covered under AS-11, are marked to market on a portfolio basis, and the net Joss after considering the offsetting effect on the underlying hedge item is charged to the income statement. Net gains are ignored.

15. Taxation;

Provision for income tax comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act 1961, Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing difference of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balancesheet date.

16. Contingencies :

Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed by way of Notes to the Accounts.

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Mar 31, 2009

1. Accounting Convention

The Financial statements have been prepared under historical cost convention and on accrual basis, except other wise stated, in accordance with the Generally Accepted Accounting Principles, to comply in all material respects with the notified Companies Accounting Standard Rules, 2006 and the provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto.

3. Fixed Assets

All fixed assets are valued at cost inclusive of freight incurred, duties & taxes (net of Cenvat) and incidental expenses less accumulated depreciation. The cost of fixed assets comprises purchase price and all other attributable costs of bringing the assets to working condition for intended use.

Expenditure for addition, improvement and renewal are capitalized and expenditure for maintenance and repairs are charged to the Profit & Loss Account.

4. Depreciation

Depreciation on fixed assets has been provided for on the basis of written down value method as per useful lives estimated by the management or at the rates and in the manner prescribed under Schedule XIV (as amended) of the Companies Act, 1956, whichever is higher.

5. Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The recoverable amount is the greater of net selling price and value in use.

6. Revenue Recognition

i) Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

ii) Revenue from Sale of goods and services rendered is recognized upon passage of title and significant risk & reward and rendering of services, to the customers. Sales are accounted for on the basis of ex-works delivery.

iii) Insurance and other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Borrowing Costs

Borrowing costs attributable to acquisition of fixed assets are treated as part of cost of such assets and capitalized upon the stage of commercial production. All other borrowing costs are charged to revenue in the period in which they are incurred.

8. Provisions

A provision is recognized when an enterprise has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.

9. Inventories

i) Finished products are valued at lower of cost on annual average basis and net realizable value.

ii) Raw materials, Stores and Spares are valued at lower of cost computed on FIFO basis and net realizable value.

iii) The valuation is net of amounts written off for obsolescence.

iv) Cost of inventories comprises of all costs of purchase, cost of conversion and other costs incurred in bringing them to their respective present location and condition.

10. Excise Duty

The purchase cost of raw materials has been considered net of CENVAT. Purchase of capital goods is also considered net of CENVAT credit.

11. Earning Per Share

Basic Earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders, by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

12. Employees Benefits

Companys contribution to Provident Fund and Employees State Insurance are charged to Profit & Loss Account. Gratuity and other retirement benefits are accounted for by the company on cash basis.

13. Foreign Currency Transactions

i) Revenue items of foreign currency are accounted for at the rate prevailing on the date of transaction.

ii) Monetary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year-end rates.

iii) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit & Loss Account except in cases when they relate to acquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

14. Derivative Instrument

As per the ICAI Announcement, accounting for derivative contracts, other than those covered under AS-11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effect on the underlying hedge item is charged to the income statement. Net gains are ignored.

15. Taxation

Provision for income tax comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing difference 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.

Tax on fringe benefits is measured at a specified rate on the value of fringe benefits in accordance with the provisions of Section 115WC of the Income Tax Act, 1961.

16. Contingencies

Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed by way of Notes to the Accounts.

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Mar 31, 2008

1. Accounting Convention

The Financial Statements have been prepared under historical cost convention and on accrual basis, except other wise stated, in accordance with the Generally Accepted Accounting Principles, to comply in all material respects with the notified Companies Accounting Standard Rules, 2006 and the provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto.

3. Fixed Assets

All fixed assets are valued at cost inclusive of freight incurred, duties & taxes (net of Cenvat) and incidental expenses less accumulated depreciation. The cost of fixed assets comprises purchase price and all other attributable costs of bringing the assets to working condition for intended use.

Expenditure for addition, improvement and renewal are capitalized and expenditure for maintenance and repairs are charged to the Profit & Loss Account.

4. Depreciation

Depreciation on fixed assets has been provided for on the basis of written down value method as per useful lives estimated by the management or at the rates and in the manner prescribed under Schedule XIV (as amended) of the Companies Act, 1956, whichever is higher.

5. Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The recoverable amount is the greater of net selling price and value in use.

6. Revenue Recognition

i. Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

ii. Revenue from Sale of goods and services rendered is recognized upon passage of title and significant risk & reward and rendering of services, to the customers. Sales are accounted for on the basis of ex-works delivery.

iii. Insurance and other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Borrowing Costs

Borrowing costs attributable to acquisition of fixed assets are treated as part of cost of such assets and capitalized upon the stage of commercial production. All other borrowing costs are charged to revenue in the period in which they are incurred.

8. Provisions

A provision is recognized when an enterprise has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.

9. Inventories

i. Finished products are valued at lower of cost on annual average basis and net realizable value.

ii. Raw materials/Stores and Spares are valued at lower of cost computed on FIFO basis and net realizable value.

iii. The valuation is net of amounts written off for obsolescence.

iv. Cost of inventories comprises of all costs of purchase, cost of conversion and other costs incurred in bringing them to their respective present location and condition.

10. Excise Duty

The purchase cost of raw materials has been considered net of CENVAT. Purchase of capital goods is also considered net of CENVAT credit.

11. Earning Per Share

Basic Earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders, by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributed to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

12. Employees Benefits

Companys contribution to Provident Fund and Employees State Insurance are charged to Profit & Loss Account. Gratuity and other retirement benefits are accounted for by the company on cash basis.

13. Foreign Currency Transactions

i. Revenue items of foreign currency are accounted for at the rate prevailing on the date of transaction.

ii. Monteary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year-end rates.

iii. Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit & Loss Account except in cases when they relate to accquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

14. Derivative Instrument

As per the ICAI Announcement, accounting for derivative contracts, other than those covered under AS-11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effect on the underlying hedge item is charged to the income statement. Net gains are ignored.

15. Taxation

Provision for income tax comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing difference 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.

Tax on fringe benefits is measured at a specified rate on the value of fringe benefits in accorance with the provisions of Section 115WC of the Income Tax Act, 1961.

16. Contingencies

Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treatment as contingent and disclosed by way of Notes to the Accounts.

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Mar 31, 2007

1. Accounting Convention

The Financial Statements are prepared as going concern under historical cost convention in accordance with the Generally Accepted Accounting Principles, mandatory accounting standards issued by the Institute of Chartered Accountants of India and the provisions of the Companies Act, 1956, adopting accrual system of accounting except where otherwise stated.

2. Use of Estimates

The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto.

3. Fixed Assets

All fixed assets are valued at cost inclusive of freight incurred, duties & taxes (net of Cenvat) and incidental expenses less accumulated depreciation. The cost of fixed assets comprises purchase price and all other attributable costs of bringing the assets to working condition for intended use.

Expenditure for addition, improvement and renewal are capitalized and expenditure for maintenance and repairs are charged to the Profit & Loss Account.

4. Depreciation

Depreciation on fixed assets has been provided for on the basis of written down value method at the rates and in the manner prescribed under Schedule XIV (as amended) of the Companies Act, 1956.

5. Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The recoverable amount is the greater of net selling price and value in use.

6. Revenue Recognition

i. Revenue from sale of goods and services rendered in recognized upon passage of title and rendering of services, to the customers. Sales are accounted for on the basis of ex- works delivery.

ii. Refund of Excise and other Leview/Taxes and insurance claim are accounted for on acceptance/actual receipt basis.

7. Borrowing Costs

Borrowing costs attributable to acquisition of fixed assets are treated as part of cost of such assets and capitalized upon the stage of commercial production. All other borrowing costs are charged to revenue in the period in which they are incurred.

8. Provisions

A provision is recognized when an enterprise has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.

9. Inventories

i. Finished products are valued at lower of cost on annual average basis and net realizable value.

ii. Raw materials/Stores and Spares are valued at lower of cost computed on FIFO basis and net realizable value.

iii. The valuation is net of amounts written off for obsolescence.

iv. Cost of inventories comprises of all costs of purchase, cost of conversion and other costs incurred in bringing them to their respective present location and condition.

10. Excise Duty

The purchase cost of raw materials has been considered net of CENVAT. Purchase of capital goods is also considered net of CENVAT credit.

11. Contingencies

Liabilities which are material and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed by way of Notes to the Accounts.

12. Earning Per Share

Earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders, by the weighted average number of equity shares outstanidng during the period.

13. Employees Benefits

Companys contribution to Provident Fund and Employees State Insurance are charged to Profit & Loss Account. Gratuity and other retirement benefits are accounted for by the company on cash basis.

14. Foreign Currency Transactions

i. Revenue items of foreign currency are accounted for at the rate prevailing on the date of transaction.

ii. Monteary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year-end rates.

iii. Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit & Loss Account except in cases when they relate to accquisition of fixed assets in which case they are adjusted to the carrying cost of such assets.

15. Preliminary & Public issue expenses

Preliminary and public issue expenses are amortizd over a period of ten years. During current year the 10 * and last instalment have been amortised.

16. Taxation,

Provision for income tax comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflect the impact of current year 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.

Tax on fringe benefits is measured at a specified rate on the value of fringe benefits in accorance with the provisions of Section 115WC of the Income Tax Act, 1961.

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Mar 31, 2005

1. Accounting Convention : The Financial Statement have been prepared in accordance with the historical cost convention and on mercantile system of accounting except bonus of contract labour and retirement benefits which is recognised on cash basis.

2. Valuation of Inventories : Raw Materials, Work-in-progress and Stores & Spares are valued at estimated cost basis and Finished Goods are valued at estimated cost.

3. Fixed Assets : Fixed Assets have been stated at cost which includes acquisition cost, freight, duties, installation cost and other incidental expenses.

4. Depreciation : The Company has charged depreciation on written Down Value Method on pro-rata basis in accordance with the rates specified in Schedule XIV to the Companies Act, 1956.

5. Excise Duty : The Purchase cost of raw materials & other materials has been considered net of CENVAT.

6. Purchase & Sales : The Purchases & Sales figures excludes inter unit transfers.

7. Preliminary & Share : Preliminary & Share Issue Expenses have been amortized Issue Expenses over a period of ten years in equal instalments.

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Mar 31, 1999

1. Basis of Accounting :

The Accounts of the Company have been prepared on historical cost basis and on accrual basis of Accounting as Going concern.

2. Depreciation :

The Company has charged Depreciation on Written Down Value Method at the rates prescribed in Schedule XIV to the Companies Act, 1956. In case of any asset has been sold, discarded, demolished or destroyed, depreciation on such assets have been calculated on pro-rata basis from the date of such addition or as the case may be up to the date on which such asset has been sold, discarded, demolished or destroyed.

Depreciation on assets whose actual cost does not exceed Five thousand rupees, has been provided at the rate of Hundred Percentage.

Leasehold Land (long term) will be written off, in the year in which the respective lease period expire.

3. Valuation of Inventories :

(A) Raw Materials : At Cost

(B) Finished Goods : At cost or market price whichever is lower.

(C) Work in Progress : At estimated cost

(D) Stores & Spares : At estimated cost

4. Excise Duty :

The Purchase cost of raw materials & other materials has been considered net of Modvat.

5. Gratuity :

Gratuity has been accounted for on Cash Basis, however, none of the employees of the Company is yet eligible for gratuity.

6. Foreign Currency Translation :

Receivables at the date of realisation are converted at prevailing exchange rates and exchange difference is recognised in Profit & Loss Account under the head "Exchange Difference".

7. Preliminary & Share Issue Expenses :

Preliminary & Share Issue Expenses have been written off @ 1/10th in equal instalment over a period of ten year.

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Mar 31, 1998

1. Basis of Accounting

The Accounts of the Company have been prepared on historical cost basis and on accrual basis of Accounting as Going concern.

2. Capital Work in Progress

Capital Work in Progress represents, a total expenses incurred in respect of fixed assets not yet commissioned, materials used for constructions etc. During the year they have been allocated towards Fixed Assets, are stated at cost less depreciation. Cost comprises of the purchase price and any attributable cost of bringing the assets to its working conditions for its intended use.

3. Depreciation

The Company has charged Depreciation on written down value method at the rates prescribed in Schedule XIV to the Companies Act, 1956 on prorata basis.

Leasehold Land (long term) will be written off, in the year in which the respective lease period expire.

4. Valuation of Inventories

(A) Raw Materials : At Cost (B) Finished Goods : At cost or market price whichever is lower. (C) Work in Progress : At estimated cost (D) Stores & Spares : At estimated cost

5. Excise Duty

The excise duty payable on production is accounted for only at the time of despatch of goods from the factory.

6. Gratuity

Gratuity have been accounted for on cost basis, however, none of the employees of the Company is yet eligible for gratuity.

7. Preliminary & Share Issue Expenses

Preliminary & Share Issue Expenses have been written off @ 1/10th in equal instalment over a period of ten years.

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Mar 31, 1995

1. Basis of Accounting

The Accounts of the Company have been prepared on historical cost basis and on accrual basis of Accounting as Going concern.

2. Capital Work in Progress

Capital Work in Progress represents advances to suppliers of fixed assets, assets not yet commissioned, materials used for construction etc.

3. Depreciation & Lease Written off

The Company has not charged Depreciation and has not written off leasehold land as it has yet to start commercial prnduction.

4. Preliminary Expenses

Preliminary Expenses will be wriflen off over a period of 10 years in equal instalments after the year of starting commercial production.

5. Preoperative Expenses

All the expenses incurred till date have bee carried under this head pending allocation/amortisation to various heads of Fixed Assets.