Accounting Policies of Rasandik Engineering Industries Ltd. Company

Mar 31, 2025

1. Company Overview and Material Accounting Policies

1.1 Company Overview

Rasandik Engineering Industries India Limited ("the
Company”) is a public limited company incorporated in India,
listed on Bombay Stock Exchange (BSE). The registered
office is located at Plot No. 1, Roj-Ka-Meo Industrial Area,
Sohna, Gurgaon, Haryana, India, 122103. The principal
activities of the company are manufacturing of sheet metal
components, muffler assemblies, fuel tank, tools & dies for
motor vehicles, spare parts and Manufacturing of electric 3
wheeler (L-5) category.

1.2 Basis of preparation and Presentation

The financial statements of the Company have been
prepared in accordance with Indian Accounting Standards
(Ind AS) as prescribed under Companies Act, 2013, read
with the Companies (Indian Accounting Standards) Rules,
2015 as amended and other relevant provisions of the Act.

The financial statements have been prepared on historical
cost convention and on an accrual basis except for the
following:

(i) Derivative financial instruments,

(ii) Certain financial assets and liabilities measured at
fair value (refer accounting policy regarding financial
instruments)

All assets and liabilities have been classified as current
or non-current as per Company''s normal operating cycle
(twelve months) and other criteria set out in the schedule
III to the Act.

Company''s financial statements are presented in India
Rupees, which is its functional currency and all values
are rounded to the nearest lakhs, except when otherwise
indicated.

Measurement of fair values

A number of the Company''s accounting policies and
disclosures require the measurement of fair values for
both financial and non-financial assets and liabilities. In
determining the fair value of its financial instruments, the
Company uses a variety of methods and assumptions that
are based on market conditions and risks existing at each
reporting date and has an established control framework with
respect to measurement of fair values. The Chief Financial
Officer and persons entrusted have overall responsibility
for overseeing all significant fair value measurements,

including Level 3 fair values and assessments that these
valuations meet the requirements of Ind AS. The methods
used to determine fair value include discounted cash
flow analysis, available quoted market prices and dealer
quotes. All methods of assessing fair value result in general
approximation of value, and such value may never actually
be realised.

Fair values are categorised into different levels in a fair
value hierarchy based on the inputs used in the valuation
techniques as follows:

Level 1: Quoted prices (unadjusted) in active markets for
identical assets and liabilities.

Level 2: inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either
directly or indirectly.

Level 3: inputs for the asset or liability that are not based on
observable market data (unobservable inputs).

The team regularly reviews significant unobservable inputs
and valuation adjustments. If third party information, such
as broker quotes or pricing services, is used to measure
fair values, then the team as sesses the evidence obtained
from the third parties to support the conclusion that these
valuations meet the requirements of Ind AS, including the
level in the fair value hierarchy in which the valuations
should be classified.

When measuring the fair value of an asset or a liability, the
Company uses observable market data as far as possible.

If the inputs used to measure the fair value of an asset or
a liability fall into different levels of the fair value hierarchy,
then the fair value measurement is categorised in its entirety
in the same level of the fair value hierarchy as the lowest
level input that is significant to the entire measurement.

The Company recognises transfers between levels of the
fair value hierarchy at the end of the reporting period during
which the change has occurred.

Further information about the assumptions made in
measuring fair values is included in note 44 - Financial risk
management.

1.3 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. The management believes
that these estimates and assumptions are reasonable _g7

and prudent. However, actual results could differ from
these estimates. Any revision to accounting estimates is
recognised prospectively in the current and future period.
An overview of the areas that involves a higher degree of
judgment or complexity, and of items which are more likely
to be materially adjusted due to estimates and assumptions
turning out to be different than those originally assessed
have been disclosed in note no. 1.4. Detailed information
about each of these estimates and judgments is included in
the relevant notes together with information about the basis
of calculation for each affected line item in the financial
statements.

1.4 Critical accounting judgments, estimates and assumptions

(a) Useful lives of Property, plant and equipment

Property, plant and equipment are depreciated over the
estimated useful lives of the assets, after taking into
account their estimated residual value. Management
reviews the estimated useful lives and residual values
of the assets annually in order to determine the amount
of depreciation to be recorded during any reporting
period. The useful lives and residual values are based on
technical evaluation and take into account anticipated
technological changes. Depreciation for future periods
is adjusted if there are significant changes from
previous estimates.

(b) Provisions and liabilities

Provisions and liabilities are recognized in the period
when it becomes probable that there will be a future
outflow of funds resulting from past operations or
events and the amount of cash outflow can be reliably
estimated. The timing of recognition and quantification
of the liability require the application of judgement to
existing facts and circumstances, which can be subject
to change.

(c) Estimation of defined benefits obligations - refer
note no. 38

Employee benefit obligations are measured on the basis
of actuarial assumptions which include mortality and
withdrawal rates as well as assumptions concerning
future developments in discount rates, anticipation
of future salary increases and the inflation rate. The
Company considers that the assumptions used to
measure its obligations are appropriate. However, any
changes in these assumptions may have a material
impact on the resulting calculations.

(d) Impairment of financial assets

The impairment provisions for financial assets are
i

based on assumptions about risk of default and
expected loss rates. The Company uses judgment in
making these assumptions and selecting the inputs to
the impairment calculation, based on the Company''s
past history, existing market conditions as well as
forward looking estimates at the end of each reporting
period.

(e) Contingent liabilities

The Company has received various orders and notices
from tax and other judicial authorities in respect of
direct taxes, indirect taxes and labour matters. The
outcome of these matters may have a material effect
on the financial position, results of operations or cash
flows. The filing of a suit or formal assertion of a claim
against the Company or the disclosure of any such suit
or assertions, does not automatically indicate that a
provision of a loss may be appropriate. Management
regularly analyzes current information about these
matters and makes provisions for probable losses
including the estimate of legal expense to resolve the
matters. In their assessments management considers
the degree of probability of an unfavorable outcome
and the ability to make a sufficiently reliable estimate
of the amount of loss.

(f) Going concern assumptions

For the financial year ended 31 March 2025, the
Company''s net current liabilities as at 31 March
2025 was ? 1,458.08 lakhs (? 1,371.86 lakhs as at
31 March 2024). Notwithstanding this, the financial
statements are prepared on a going concern basis as
the management believes that the business operations
would be able to generate sufficient cash flow to meet
its short-term obligations in near future. Towards this
objective, the management is constantly engaged in
various initiatives like rationalizing costs, negotiating
extended credit terms with suppliers, monetising of
certain assets (refer note no. 13) and taking appropriate
initiatives to improve revenues and reduction in net
current liabilities position. In addition, the Company has
received a letter of financial support from a substantial
shareholder (Managing Director) / promoter to provide
continuing financial support to the Company as and
when required to meet the Company''s working capital
needs.

Further, during the year, the Company has received
interest free unsecured long-term loan of Rs. 229.25
lakhs (PY Rs. 254.00 Lakhs) from its Promoter
Managing Director/Director, total outstanding loan is
Rs. 653.25 lakhs.

1.5 Property, Plant and equipment

On transition to Ind AS, the Company had elected to measure
the certain items of property, plant and equipment at its fair
value and is using its fair value as its deemed cost. Items
measured at fair value are plant and equipment (including
CWIP), freehold land and leasehold land. Building, furniture
and fixtures, office equipments, computers and vehicles are
carried at previous GAAP carrying amount.

Subsequent costs are included in the asset''s carrying
amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits
associated with the item will flow to the Company and the
cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate
asset is derecognized when replaced.

Depreciation on property, plant and equipment is provided
on straight-line method on the basis of estimated useful
life of the assets. The expected useful life and the expected
residual value are reviewed at the end of each financial year. If
the expected useful life and the expected residual value of an
asset are significantly different from its previous estimates,
depreciation is provided on the revised depreciable amount
of the assets over the remaining useful life.

The management estimates the useful lives for the tangible
assets as follows:

For the above classes of assets, based on internal
assessment and technical evaluation carried out, the
management believes that the useful lives as given above
best represent the period over which management expects
to use these assets.

The residual values are not more 5% of the original cost of
the assets.

individual assets costing Rs. 5,000/- or less are depreciated
in full.

1.6 Capital work in progress

Capital work-in-progress includes assets in the course
of construction for production and/or supply of goods or
services or administrative purposes, or for purposes not
yet determined, are carried at cost, less any recognised
impairment loss.

Expenses incurred relating to project, net of income earned
during the project development stage prior to its intended
use, are considered as pre-operative expenses and disclosed
under Capital work in progress.

1.7 Impairment of non-financial assets

Assessment is done at each balance sheet date as to
whether there is any indication that an asset may be
impaired. If any such indication exists, an estimate of the
recoverable amount of the asset / cash generating unit is
made. Recoverable amount is higher of an asset''s or cash
generating unit''s net selling price and its value in use. Value
in use is the present value of estimated future cash flows
expected to arise from the continuing use of an asset
and from its disposal at the end of its useful life. For the
purpose of assessing impairment, the recoverable amount
is determined for an individual asset, unless the asset does
not generate cash inflows that are largely independent of
those from other assets or groups of assets. The smallest
identifiable group of assets that generates cash inflows
from continuing use that are largely independent of the cash
inflows from other assets or groups of assets, is considered
as a cash generating unit (CGU). An asset or CGU whose
carrying value exceeds its recoverable amount is considered
impaired and is written down to its recoverable amount.
Assessment is also done at each Balance Sheet date as
to whether there is any indication that an impairment loss
recognised for an asset in prior accounting periods may no
longer exist or may have decreased.

1.8 Leases

Where the Company is a lessee:

The Company''s lease asset classes primarily consist
of leases for Plant & equipment, land and building. The
Company, at the inception of a contract, assesses whether
the contract is a lease or not a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of
an identified asset for a time in exchange for a consideration.

This policy has been applied to contract existing and entered
into on or after April 1,2019.The Company has elected not to
recognize Right-of-use Assets and lease liabilities for short¬
term leases that have a lease term of 12 months or less and

99

?

leases of low-value assets. The Company recognizes the
lease payments associated with these leases as an expense
over the lease term. The Company recognises a Right-of-
use Asset and a lease liability at the lease commencement
date. The Right-of-use asset is initially measured at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or before the
commencement date, plus any initial costs incurred. The
Right-of-use Asset is subsequently depreciated using the
straight-line method from the commencement date to the
end of the lease term. The lease liability is initially measured
at the present value of the lease payments that are not
paid at the commencement date, discounted using the
Company''s incremental borrowing rate. Subsequently, lease
liabilities are measured on amortised cost basis. In the
comparative period, lease payments under operating leases
are recognized as an expense in the statement of profit and
loss over the lease term.

The Company applies the short-term lease recognition
exemption to its short-term leases (i.e., those leases that have
a lease term of 12 months or less from the commencement
date and do not contain a purchase option). It also applies
the lease of low-value assets recognition exemption to
leases that are considered to be low value. Lease payments
on short-term leases and leases of low-value assets are
recognised as expense.

Where the Company is the Lessor:

Lease under which the Company does not transfer
substantially all the risks and benefits of ownership of the
asset is classified as operating lease. Lease income from
operating lease is recognized in the Statement of Profit and
Loss on a straight-line basis over the lease term except
where the lease payments are structured to increase in line
with expected general inflation. Costs including depreciation
are recognized as an expense in the Statement of Profit and
Loss.

1.9 Inventories

Inventories are valued at the lower of cost or net realizable
value, less any provisions for obsolescence. Cost is
determined on the following basis:-

Raw Material, components, stores & spares is recorded at
cost on a first-in, first-out (FIFO) basis;

Finished goods and work-in-process are valued at raw
material cost plus cost of conversion and attributable
proportion of manufacturing overhead incurred in bringing
0 inventories to its present location and condition.

Scrap are valued at net realizable value.

Machinery spares (other than those qualified to be
capitalized as PPE and depreciated accordingly) are charged
to profit and loss on consumption.

Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs of
completion and estimated costs necessary to make the
sale.

1.10 Financial Instruments

A. Financial asset

i. Initial recognition and Measurement

All financial assets are recognised initially at fair
value (purchase value plus transaction costs that
are attributable to the acquisition of the financial
asset), amortized cost or at cost. 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. However, trade
receivables that do not contain a significant
financing component are measured at transaction
price.

ii. Subsequent measurement

> Financial assets carried at Amortised cost:

A financial asset is subsequently measured at
amortised cost if it is held within a business model
whose objective is to hold the asset 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 principal outstanding.

> Financial assets at Fair value through other
comprehensive income (FVOCI):

A financial asset is subsequently measured at fair
value through other comprehensive income if it is
held within a business model whose objective is
achieved by both collecting contractual cash flows
and selling 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 principal outstanding.

> Financial asset at Fair value through profit or loss
(FVTPL):

A financial asset which is not classified in any of
the above categories is subsequently fair valued
through profit and loss.

iii. Impairment of financial assets

The Company assesses impairment of financial
assets carried at amortised cost based on
expected credit loss model (ECL). The Company
follows ''simplified approach'' for recognition of
impairment loss allowance on trade receivables.
The Company recognizes impairment loss
allowance based on lifetime ECLs at each
reporting date, right from its initial recognition.
The Company uses historical loss experience to
determine the impairment loss allowance on trade
receivables. At each reporting date, the historical
observed default rates are updated and changes
in the forward-looking estimates are analysed.

B. Financial liabilities

i. Initial recognition and Measurement

All financial liabilities are recognized initially at fair
value and in case of loans and borrowings and
payables, net of directly attributable cost. Fees of
recurring nature are directly recognized in profit
and loss as finance cost.

ii. Subsequent measurement

Financial liabilities are subsequently measured
at amortised cost using effective interest rate
method. For trade and other payable maturing
within one year from the balance sheet date, the
carrying amounts approximate fair value due to
short term maturity of these instruments.

C. Equity instruments

The Company measures its equity investments other
than in subsidiary at fair value through profit and
loss. However, where the Company''s management
makes an irrevocable choice on initial recognition
to present fair value gains and losses on specific
equity instruments in other comprehensive income
(currently no such choice made), there is no
subsequent reclassification on sale or otherwise, of
fair value gains and losses to the statement of profit
and loss.

D. Interest income is recognized using effective
interest rate method. Dividends are recognized in the
statement of profit and loss only when the right to
receive payment is established.

E. Derecognition of financial instruments

The Company derecognizes financial asset when the
contractual rights to the cash flows from the financial
asset expire or it transfers the financial asset and
the transfer qualifies for derecognition under Ind AS
109. A financial liability (or part of financial liability)
is derecognized from the Company''s balance sheet
when the obligation specified in the contract is
discharged or cancelled or expires.

F. Offsetting

Financial assets and financial liabilities are offset and
the net amount presented in the balance sheet when,
and only when, the Company currently has a legally
enforceable right to set off the amounts and it intends
either to settle them on a net basis or to realise the
asset and settle the liability simultaneously.

1.11 Borrowings

Borrowings are initially recognized at net of transaction
cost incurred and measured at amortised cost. Any
difference between the proceeds (net of transaction cost)
and the redemption amount is recognized in the statement
of profit and loss over the period of borrowings using the
effective interest rate.

1.12 Employee Benefits

Employee benefits includes salaries and wages, provident
fund, gratuity, compensated absences and other welfare
and terminal benefits.

Short term employee benefits:

All employee benefits payable wholly within twelve months
of rendering the service are classified as short-term
employee benefits. The undiscounted amount of short¬
term employee benefits expected to be paid in exchange
for the services rendered by employees are recognised
during the year when the employees render the service.
These benefits includes performance incentives, salaries
and wages, bonus and leave travel allowance and other
welfare and terminal benefits.

Defined contribution plans:

Contributions to defined contribution scheme like
provident fund is recognized as on expense during the
year in which the employee renders the related service.

Employee State Insurance

The Company makes contribution towards employee
state insurance scheme (ESIS), a defined contribution
benefit plan for qualifying employees. The Company''s
contribution to the ESIS is deposited by the Company
under the Employees State Insurance Act, 1948. The
contributions deposited with authorities are recognized as
expense during the year.

Gratuity

The Company''s gratuity plan is a defined benefit plan.
The present value of the obligation under such defined
benefit plan is determined based on actuarial valuation
using the projected unit credit method, which recognises
each period of service as giving rise to additional unit of
employee benefit entitlement and measures each unit
separately to build up the final obligation. The obligation
is measured at the present value of the estimated future
cash flows. The discount rate used for determining the
present value of the obligation under defined benefit plans,
is based on the prevailing market yields on government
securities as at the balance sheet date.

Re-measurement, comprising actuarial gains and losses,
is reflected immediately in the balance sheet with a charge
or credit recognised in other comprehensive income in the
period in which they occur. Re-measurement recognised
in other comprehensive income is reflected immediately
in retained earnings and is not reclassified to profit or
loss. Past service cost is recognised in profit or loss in the
period of a plan amendment. Net interest is calculated by
applying the discount rate at the beginning of the period
to the net defined benefit liability or asset. Defined benefit
costs are categorized as follows:

- Service cost (including current service cost, past service
cost, as well as gains and losses on curtailments and
settlements);

- Net interest expense or income; and

- Re-measurement

The Company presents the first two components of
defined benefit costs in profit or loss in the line item
''Employee benefits expense''. Curtailment gains and losses
are accounted for as past service costs.

1.13 Foreign Currency Transactions and translations

Functional and presentation currency

The financial statements are presented in Indian Rupee
(INR), which is Company''s functional and presentation
currency.

Transactions in foreign currencies are recognised at
the prevailing exchange rates on the transactions date.
Realised gains and losses on settlement of foreign
currency transactions are recognized in the statement of
profit and loss.

Monetary foreign currency assets and liabilities at the
year-end are translated at the year-end exchange rates
and resultant exchange differences are recognized in the
statement of profit and loss.

All other foreign exchange gain and losses are presented in
the statement of profit and loss on net basis within other
income / other expenses.

1.14 Income tax
Current income tax

Current income tax represents the tax currently payable on
the taxable income for the year and any adjustment to the
tax in respect of the previous years. It is measured using
tax rates enacted or substantively enacted at the reporting
date.

Deferred tax

Deferred tax is provided using the balance sheet approach
on temporary differences at the reporting date between
the tax bases of assets and liabilities and their carrying
amounts for financial reporting purposes at the reporting
date.

Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply in the year when the asset
is realised or the liability is settled, based on tax rates (and
tax laws) that have been enacted or substantively enacted
at the reporting date.

Unrecognised deferred tax assets are reassessed at each
reporting date and are recognised to the extent that it has
become probable that future taxable profits will allow the
deferred tax asset to be recovered.

The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to be
utilised.

1.15 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
entitled in exchange for those goods or services.

Revenue is measured based on the transaction price as
specified in the contract with the customer. It excludes
discounts, incentives, volume rebates, goods & services
tax and amounts collected on behalf of third parties. In
determining the transaction price, the Company considers
below, if any

Variable consideration includes volume discounts, price
concessions, liquidated damages, incentives, etc. The
Company estimates the variable consideration with respect
to above based on an analysis of accumulated historical
experience. The variable consideration is adjusted as and
when the expectation regarding the same changes.

Sale of goods

Performance obligation in case of Revenue from sale of
goods is satisfied at a point in time and is recognized
when control of goods is transferred to the customers.
Generally, control is transferred upon shipment of goods to
the customer or when the goods are made available to the
customer, provided transfer of title to the customer occurs
and the Company has not retained any significant risks of
ownership or future obligations with respect to the goods
shipped.

Sale of services:

In contracts involving the rendering of services, revenue
is measured using the proportionate completion method
when no significant uncertainty exists regarding the
amount of the consideration that will be derived from
rendering the service and are recognised net of service
tax/ GST.

Interest Income from a financial asset is recognised when
it is probable that the economic benefits will flow to the
Company and the amount of income can be measured
reliably. Interest income is accrued on a time basis, by
reference to the principal outstanding and at the effective
interest rate applicable and dividend income from
investments in shares is recognised when the owner''s right
to receive the payment is established.

1.16 Government Grants

Grants from the Government are recognised when there is
reasonable certainty that the grant will be received and all
attaching conditions will be complied with.

Grants relating to property, plant and equipment are
included in Non-current liabilities as deferred income and
are credited to Profit and loss on fulfillment of associated
condition.

1.17 Borrowing Cost

Borrowing costs include interest, other costs incurred in
connection with borrowing. General and specific borrowing
costs directly attributable to the acquisition, construction,
production or development of qualifying assets, which are
assets that necessarily take a substantial period of time
to get ready for their intended use or sale, are added to
the cost of those assets, until such time the assets are
substantially ready for their intended use or sale. All other
borrowing costs are recognised in Statement of Profit and
Loss in the period in which they are incurred.

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Mar 31, 2024

1. Company Overview and Material Accounting Policies

1.1 Company Overview

Rasandik Engineering Industries India Limited ("the Company”) is a public limited company incorporated in India, listed on Bombay Stock Exchange (BSE). The registered office is located at Plot No. 1, Roj-Ka-Meo Industrial Area, Sohna, Gurgaon, Haryana, India, 122103. The principal activities of the company are manufacturing of sheet metal components, muffler assemblies, fuel tank, tools & dies for motor vehicles, spare parts and Manufacturing of electric 3 wheeler (L-5) category

1.2 Basis of preparation and Presentation

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) as prescribed under Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules, 2015 as amended and other relevant provisions of the Act.

The financial statements have been prepared on historical cost convention and on an accrual basis except for the following:

(i) Derivative financial instruments,

(ii) Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments)

All assets and liabilities have been classified as current or non-current as per Company''s normal operating cycle (twelve months) and other criteria set out in the schedule III to the Act.

Company''s financial statements are presented in India Rupees, which is its functional currency and all values are rounded to the nearest lakhs, except when otherwise indicated.

Measurement of fair values

A number of the Company''s accounting policies and disclosures require the measurement of fair values for both financial and non-financial assets and liabilities. In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting date and has an established control framework with respect to measurement of fair values. The Chief Financial Officer and persons entrusted have overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values

and assessments that these valuations meet the requirements of Ind AS. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices and dealer quotes. All methods of assessing fair value result in general approximation of value, and such value may never actually be realised.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The team regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then the team as sesses the evidence obtained from the third parties to support the conclusion that these valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which the valuations should be classified.

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Further information about the assumptions made in measuring fair values is included in note 44 - Financial risk management.

1.3 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. The management believes that these estimates and assumptions are reasonable and prudent. However, actual results could differ from

these estimates. Any revision to accounting estimates is recognised prospectively in the current and future period. An overview of the areas that involves a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed have been disclosed in note no. 1.4. Detailed information about each of these estimates and judgments is included in the relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

1.4 Critical accounting judgments, estimates and assumptions

(a) Useful lives of Property, plant and equipment

Property, plant and equipment are depreciated over the estimated useful lives of the assets, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and residual values are based on technical evaluation and take into account anticipated technological changes. Depreciation for future periods is adjusted if there are significant changes from previous estimates.

(b) Provisions and liabilities

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change.

(c) Estimation of defined benefits obligations - refer note no. 39

Employee benefit obligations are measured on the basis of actuarial assumptions which include mortality and withdrawal rates as well as assumptions concerning future developments in discount rates, anticipation of future salary increases and the inflation rate. The Company considers that the assumptions used to measure its obligations are appropriate. However, any changes in these assumptions may have a material impact on the resulting calculations.

(d) Impairment of financial assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(e) Contingent liabilities

The Company has received various orders and notices from tax and other judicial authorities in respect of direct taxes, indirect taxes and labour matters. The outcome of these matters may have a material effect on the financial position, results of operations or cash flows. The filing of a suit or formal assertion of a claim against the Company or the disclosure of any such suit or assertions, does not automatically indicate that a provision of a loss may be appropriate. Management regularly analyzes current information about these matters and makes provisions for probable losses including the estimate of legal expense to resolve the matters. In their assessments management considers the degree of probability of an unfavorable outcome and the ability to make a sufficiently reliable estimate of the amount of loss.

(f) Going concern assumptions

For the financial year ended 31 March 2024, the Company''s net current liabilities as at 31 March 2024 was ? 1,371.86 lakhs (? 3,688.00 lakhs as at 31 March 2023). Notwithstanding this, the financial statements are prepared on a going concern basis as the management believes that the business operations would be able to generate sufficient cash flow to meet its short-term obligations in near future. Towards this objective, the management is constantly engaged in various initiatives like rationalizing costs, negotiating extended credit terms with suppliers, monetising of certain assets (refer note no. 13) and taking appropriate initiatives to improve revenues and reduction in net current liabilities position. Further, subsequent to the year, land and building aggregating to ? 750.19 lakhs included in "non-current asset held for sale” as at 31 March 2024 has been sold for an amount of ? 1,400.00 lakhs. The proceeds from sale of said immovable property was utilised for payment of

finance cost and repayment of loans obtained from Banks. This has further resulted in improvement of net current liabilities position of the Company. In addition, the Company has received a letter of financial support from a substantial shareholder (Managing Director) / promoter to provide continuing financial support to the Company as and when required to meet the Company''s working capital needs.

Further, during the year, the Company has received interest free unsecured long-term loan of Rs. 254 lakhs from its Promoter Managing Director/Director.

1.5 Property, Plant and equipment

On transition to Ind AS, the Company had elected to measure the certain items of property, plant and equipment at its fair value and is using its fair value as its deemed cost. Items measured at fair value are plant and equipment (including CWIP), freehold land and leasehold land. Building, furniture and fixtures, office equipments, computers and vehicles are carried at previous GAAP carrying amount.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced.

Depreciation on property, plant and equipment is provided on straight-line method on the basis of estimated useful life of the assets. The expected useful life and the expected residual value are reviewed at the end of each financial year. If the expected useful life and the expected residual value of an asset are significantly different from its previous estimates, depreciation is provided on the revised depreciable amount of the assets over the remaining useful life.

The management estimates the useful lives for the tangible assets as follows:

For the above classes of assets, based on internal assessment and technical evaluation carried out, the management believes that the useful lives as given above best represent the period over which management expects to use these assets.

The residual values are not more 5% of the original cost of the assets.

individual assets costing Rs. 5,000/- or less are depreciated in full.

1.6 Capital work in progress

Capital work-in-progress includes assets in the course of construction for production and/or supply of goods or services or administrative purposes, or for purposes not yet determined, are carried at cost, less any recognised impairment loss.

Expenses incurred relating to project, net of income earned during the project development stage prior to its intended use, are considered as pre-operative expenses and disclosed under Capital work in progress.

1.7 Impairment of non-financial assets

Assessment is done at each balance sheet date as to whether there is any indication that an asset may be impaired. If any such indication exists, an estimate of the recoverable amount of the asset / cash generating unit is made. Recoverable amount is higher of an asset''s or cash generating unit''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. For the purpose of assessing impairment, the recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. The smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows from other assets or groups of assets, is considered as a cash generating unit (CGU). An asset or CGU whose carrying value exceeds its recoverable amount is considered impaired and is written down to its recoverable amount. Assessment is also done at each Balance Sheet date as to whether there

is any indication that an impairment loss recognised for an asset in prior accounting periods may no longer exist or may have decreased.

1.8 Leases

Where the Company is a lessee:

The Company''s lease asset classes primarily consist of leases for Plant & equipment, land and building. The Company, at the inception of a contract, assesses whether the contract is a lease or not a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a time in exchange for a consideration. This policy has been applied to contract existing and entered into on or after April 1, 2019.The Company has elected not to recognize Right-of-use Assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The Company recognizes the lease payments associated with these leases as an expense over the lease term. The Company recognises a Right-of-use Asset and a lease liability at the lease commencement date. The Right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial costs incurred. The Right-of-use Asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the Company''s incremental borrowing rate. Subsequently, lease liabilities are measured on amortised cost basis. In the comparative period, lease payments under operating leases are recognized as an expense in the statement of profit and loss over the lease term.

The Company applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases that are considered to be low value. Lease payments on short-term leases and leases of low-value assets are recognised as expense.

Where the Company is the Lessor:

Lease under which the Company does not transfer substantially all the risks and benefits of ownership of the asset is classified as operating lease. Lease income from operating lease is recognized in the Statement of

Profit and Loss on a straight-line basis over the lease term except where the lease payments are structured to increase in line with expected general inflation. Costs including depreciation are recognized as an expense in the Statement of Profit and Loss.

1.9 Inventories

Inventories are valued at the lower of cost or net realizable value, less any provisions for obsolescence. Cost is determined on the following basis:-

Raw Material, components, stores & spares is recorded at cost on a first-in, first-out (FIFO) basis;

Finished goods and work-in-process are valued at raw material cost plus cost of conversion and attributable proportion of manufacturing overhead incurred in bringing inventories to its present location and condition.

Scrap are valued at net realizable value.

Machinery spares (other than those qualified to be capitalized as PPE and depreciated accordingly) are charged to profit and loss on consumption.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

1.10 Financial Instruments

A. Financial asset

i. Initial recognition and Measurement

All financial assets are recognised initially at fair value (purchase value plus transaction costs that are attributable to the acquisition of the financial asset), amortized cost or at cost. 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. However, trade receivables that do not contain a significant financing component are measured at transaction price.

ii. Subsequent measurement

> Financial assets carried at Amortised cost:

A financial asset is subsequently measured at amortised cost if it is held within a business

model whose objective is to hold the asset 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 principal outstanding.

> Financial assets at Fair value through other comprehensive income (FVOCI):

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling 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 principal outstanding.

> Financial asset at Fair value through profit or loss (FVTPL):

A financial asset which is not classified in any of the above categories is subsequently fair valued through profit and loss.

iii. Impairment of financial assets

The Company assesses impairment of financial assets carried at amortised cost based on expected credit loss model (ECL). The Company follows ''simplified approach'' for recognition of impairment loss allowance on trade receivables. The Company recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. The Company uses historical loss experience to determine the impairment loss allowance on trade receivables. At each reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

B. Financial liabilities

i. Initial recognition and Measurement

All financial liabilities are recognized initially at fair value and in case of loans and borrowings and payables, net of directly attributable cost. Fees of recurring nature are directly recognized in profit and loss as finance cost.

ii. Subsequent measurement

Financial liabilities are subsequently measured at amortised cost using effective interest rate method. For trade and other payable maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to short term maturity of these instruments.

C. Equity instruments

The Company measures its equity investments other than in subsidiary at fair value through profit and loss. However, where the Company''s management makes an irrevocable choice on initial recognition to present fair value gains and losses on specific equity instruments in other comprehensive income (currently no such choice made), there is no subsequent reclassification on sale or otherwise, of fair value gains and losses to the statement of profit and loss.

D. Interest income is recognized using effective interest rate method. Dividends are recognized in the statement of profit and loss only when the right to receive payment is established.

E. Derecognition of financial instruments

The Company derecognizes financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or part of financial liability) is derecognized from the Company''s balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

F. Offsetting

Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.

1.11 Borrowings

Borrowings are initially recognized at net of transaction cost incurred and measured at amortised cost. Any difference between the proceeds (net of transaction cost) and the redemption amount is recognized in the statement of profit and loss over the period of borrowings using the effective interest rate.

1.12 Employee Benefits

Employee benefits includes salaries and wages, provident fund, gratuity, compensated absences and other welfare and terminal benefits.

Short term employee benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. The undiscounted amount of shortterm employee benefits expected to be paid in exchange for the services rendered by employees are recognised during the year when the employees render the service. These benefits includes performance incentives, salaries and wages, bonus and leave travel allowance and other welfare and terminal benefits.

Defined contribution plans:

Contributions to defined contribution scheme like provident fund is recognized as on expense during the year in which the employee renders the related service.

Employee State Insurance

The Company makes contribution towards employee state insurance scheme (ESIS), a defined contribution benefit plan for qualifying employees. The Company''s contribution to the ESIS is deposited by the Company under the Employees State Insurance Act, 1948. The contributions deposited with authorities are recognized as expense during the year.

Gratuity

The Company''s gratuity plan is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plans, is based on the prevailing market yields on government securities as at the balance sheet date.

Re-measurement, comprising actuarial gains and losses, is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Re-measurement recognised in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognised in profit or loss in the

period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:

- Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

- Net interest expense or income; and

- Re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ''Employee benefits expense''. Curtailment gains and losses are accounted for as past service costs.

1.13 Foreign Currency Transactions and translations

Functional and presentation currency

The financial statements are presented in Indian Rupee (INR), which is Company''s functional and presentation currency.

Transactions in foreign currencies are recognised at the prevailing exchange rates on the transactions date. Realised gains and losses on settlement of foreign currency transactions are recognized in the statement of profit and loss.

Monetary foreign currency assets and liabilities at the year-end are translated at the year-end exchange rates and resultant exchange differences are recognized in the statement of profit and loss.

All other foreign exchange gain and losses are presented in the statement of profit and loss on net basis within other income / other expenses.

1.14 Income tax Current income tax

Current income tax represents the tax currently payable on the taxable income for the year and any adjustment to the tax in respect of the previous years. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred tax

Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised.

1.15 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 entitled in exchange for those goods or services.

Revenue is measured based on the transaction price as specified in the contract with the customer. It excludes discounts, incentives, volume rebates, goods & services tax and amounts collected on behalf of third parties. In determining the transaction price, the Company considers below, if any

Variable consideration includes volume discounts, price concessions, liquidated damages, incentives, etc. The Company estimates the variable consideration with respect to above based on an analysis of accumulated historical experience. The variable consideration is adjusted as and when the expectation regarding the same changes.

Sale of goods

Performance obligation in case of Revenue from sale of goods is satisfied at a point in time and is recognized when control of goods is transferred to the customers. Generally, control is transferred upon shipment of goods to the customer or when the goods are made available to the customer, provided transfer of title to the customer occurs and the Company has not retained any significant risks of ownership or future obligations with respect to the goods shipped.

Sale of services:

In contracts involving the rendering of services, revenue is measured using the proportionate completion method when no significant uncertainty exists regarding the

amount of the consideration that will be derived from rendering the service and are recognised net of service tax/ GST.

Interest Income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable and dividend income from investments in shares is recognised when the owner''s right to receive the payment is established.

1.16 Government Grants

Grants from the Government are recognised when there is reasonable certainty that the grant will be received and all attaching conditions will be complied with.

Grants relating to property, plant and equipment are included in Non-current liabilities as deferred income and are credited to Profit and loss on fulfillment of associated condition.

1.17 Borrowing Cost

Borrowing costs include interest, other costs incurred in connection with borrowing. General and specific borrowing costs directly attributable to the acquisition, construction, production or development of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in Statement of Profit and Loss in the period in which they are incurred.

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Mar 31, 2018

1.1 Company Overview

Rasandik Engineering Industries India Limited (“the Company”) is a public limited company incorporated in India, listed on Bombay Stock Exchange (BSE). The address of its registered office located at 14 Roj-Ka-Meo Industrial Area Sohana Distt.Gurgaon Hr 122103. The principal activities of the company are manufacturing of sheet metal components, rear axle, muffler assemblies, Fuel neck and Tools & dies for motor vehicles, components and spare parts.

1.2 Basis of preparation and Presentation

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) as prescribed under Companies Act, 2013, Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Act.

These financial statements are first financial statement of the Company under Ind AS and as covered by Ind AS 101 - First time adoption of Indian Accounting Standard. Refer Note no. 2 for an explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flow.

The financial statements have been prepared on a historical cost convention and on an accrual basis except for the following:

i. Derivative financial instruments,

ii. Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments)

All assets and liabilities have been classified as current or non-current as per Company''s normal operating cycle (twelve months) and other criteria set out in the schedule III to the Act.

Company''s financial statements are presented in India Rupees, which is its functional currency.

1.3 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. The management believes that these estimates and assumptions are reasonable and prudent. However, actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively in the current and future period. An overview of the areas that involved a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed have been disclosed in note no. 1.4. Detailed information about each of these estimates and judgments is included in the relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

1.4 Significant Estimates and judgments

a. Depreciation and useful lives of Property, plant and equipment

Property, plant and equipment are depreciated over the estimated useful lives of the assets, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and residual values are based on technical evaluation and take into account anticipated technological changes. Depreciation for future periods is adjusted if there are significant changes from previous estimates.

b. Provisions and liabilities

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change.

c. Estimation of defined benefits obligations - refer note no. 27

Employee benefit obligations are measured on the basis of actuarial assumptions which include mortality and withdrawal rates as well as assumptions concerning future developments in discount rates, anticipation of future salary increases and the inflation rate. The Company considers that the assumptions used to measure its obligations are appropriate. However, any changes in these assumptions may have a material impact on the resulting calculations.

1.5 Property, Plant and equipment

On transition to Ind AS, the Company has elected to measure the certain items of property, plant and equipment at its fair value and is using its fair value as its deemed cost. Items measured at fair value are plant and equipment (including CWIP), freehold land and leasehold land. Building, furniture and fixtures, office equipments, computers and vehicles are carried at previous GAAP carrying amount.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced.

Depreciation on property, plant and equipment is provided on straight-line method on the basis of estimated useful life of the assets. The expected useful life and the expected residual value are reviewed at the end of each financial year. If the expected useful life and the expected residual value of an asset are significantly different its previous estimates, depreciation is being provided on the revised depreciable amount of the assets over the remaining useful life.

The management estimates the useful lives for the tangible assets as follows:

For the above classes of assets, based on internal assessment and technical evaluation carried out, the management believes that the useful lives as given above best represent the period over which management expects to use these assets.

The residual values are not more 5% of the original cost of the assets. individual assets costing Rs. 5,000/- or less are depreciated in full.

1.6 Capital work in progress

Capital work-in-progress includes assets under construction in the course of construction for production or / and supply of goods or services or administrative purposes, or for purposes not yet determined, are carried at cost, less any recognised impairment loss.

Expenses incurred relating to project, net of income earned during the project development stage prior to its intended use, are considered as pre-operative expenses and disclosed under Capital work in progress.

1.8 Impairment of non-financial assets

Assessment is done at each balance sheet date as to whether there is any indication that an asset may be impaired. If any such indication exists, an estimate of the recoverable amount of the asset / cash generating unit is made. Recoverable amount is higher of an asset''s or cash generating unit''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. For the purpose of assessing impairment, the recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. The smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows from other assets or groups of assets, is considered as a cash generating unit (CGU). An asset or CGU whose carrying value exceeds its recoverable amount is considered impaired and is written down to its recoverable amount. Assessment is also done at each Balance Sheet date as to whether there is any indication that an impairment loss recognised for an asset in prior accounting periods may no longer exist or may have decreased.

1.10 Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating lease.

Company as lessee:

Assets held under finance leases are initially recognised at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly to the statement of profit and loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the Company''s general policy on borrowing costs. Contingent rentals are recognised as expenses in the periods in which they are incurred.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases.

1.11 Inventories

Inventories are valued at the lower of cost or net realizable value, less any provisions for obsolescence. Cost is determined on the following basis:-

Raw Material, components, stores & spares is recorded at cost on a first-in, first-out (FIFO) basis;

Finished goods and work-in-process are valued at raw material cost cost of conversion and attributable proportion of manufacturing overhead incurred in bringing inventories to its present location and condition.

Scrap are valued at net realizable value.

Machinery spares (other than those qualified to be capitalized as PPE and depreciated accordingly) are charged to profit and loss on consumption.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

1.12 Financial Instruments

1 Financial asset

i. Initial recognition and Measurement

All financial assets and liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and liabilities, which are not fair value through profit and loss, are adjusted to the fair value on initial recognition.

ii. Subsequent measurement

- Financial assets carried at Amortised cost:

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset 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 principal outstanding.

- Financial assets at Fair value through other comprehensive income (FVOCI):

A financial asset is subsequently measures at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows and selling 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 principal outstanding.

- Financial asset at Fair value through profit or loss (FVTPL):

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit and loss.

iii. Impairment of financial assets

The Company assesses impairment of financial assets carried at amortised cost based on expected credit loss model (ECL). The Company follows ''simplified approach'' for recognition of impairment loss allowance on trade receivables. The Company recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. The Company uses historical loss experience to determine the impairment loss allowance on trade receivables. At each reporting date, the historical observed default rates are updated and changes in the forward looking estimates are analysed.

2 Financial liabilities

i. Initial recognition and Measurement

All financial liabilities are recognized initially at fair value and in case of loans and borrowings and payables, net of directly attributable cost. Fees of recurring nature are directly recognized in profit and loss as finance cost.

ii. Subsequent measurement

Financial liabilities are subsequently measured at amortised cost using effective interest method. For trade and other payable maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to short term maturity of these instruments.

3 Equity instruments

The Company measures its equity investment other in subsidiary at fair value through profit and loss. However, where the Company''s management makes an irrevocable choice on initial recognition to present fair value gains and losses on specific equity instruments in other comprehensive income (currently no such choice made), there is no subsequent reclassification on sale or otherwise, of fair value gains and losses to the statement of profit and loss.

4 Interest income is recognized using effective interest rate method. Dividends are recognized in the statement of profit and loss only when the right to receive payment is established.

5 Derecognition of financial instruments

The Company derecognizes financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or part of financial liability) is derecognized from the Company''s balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

1.13 Borrowings

Borrowings are initially recognized at net of transaction cost incurred and measured at amortised cost. Any difference between the proceeds (net of transaction cost) and the redemption amount is recognized in the statement of profit and loss over the period of borrowings using the effective interest rate.

1.15 Employee Benefits

Employee benefits includes salaries and wages, provident fund, gratuity, compensated absences and other welfare and terminal benefits.

Short term employee benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised during the year when the employees render the service. These benefit includes performance incentive, salaries and wages, bonus and leave travel allowance and other welfare and terminal benefits.

Defined contribution plans:

Contributions to defined contribution schemes such as provident fund, superannuation, etc are recognized as on expense during the year in which the employee renders the related service.

ESI

The Company makes contribution towards employee state insurance scheme (ESIS), a defined contribution benefit plan for qualifying employees. The Company''s contribution to the ESIS is deposited by the Company under the Employees State Insurance Act, 1948. The contributions deposited with authorities are recognized as an expense during the year

Compensated absence:

Benefits comprising compensated absences as per company policy constitute other long term employee benefits. The liability for compensated absences is provided on the basis of an actuarial valuation done by an independent actuary at the year end. Actuarial gains and losses are recognised immediately in the statement of profit and loss.

Gratuity

The Company''s gratuity plan is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plans, is based on the prevailing market yields on government securities as at the balance sheet date.

Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:

- Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

- Net interest expense or income; and

- Remeasurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ''Employee benefits expense''. Curtailment gains and losses are accounted for as past service costs.

1.16 Foreign Currency Transactions and translations

Functional and presentation currency

The financial statements are presented in Indian Rupee (INR), which is Company''s functional and presentation currency.

Transactions and Translations:

Transactions in foreign currencies are recognised at the prevailing exchange rates on the transactions dates. Realised gains and losses on settlement of foreign currency transactions are recognized in the statement of profit and loss.

Monetary foreign currency assets and liabilities at the year-end are translated at the year-end exchange rates and resultant exchange differences are recognized in the statement of profit and loss except exchange differences relating certain long term monetary items outstanding as at 31st March, 2017 in so far as they relate to the acquisition of fixed assets are adjusted in the carrying amount of such, in accordance the option available to the Company under Ind AS 101.

1.17 Income tax Current income tax

Current income tax represents the tax currently payable on the taxable income for the year and any adjustment to the tax in respect of the previous years. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred tax

Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised.

1.18 Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are inclusive of excise duty and net of returns, trade allowances, rebates, value added taxes and amounts collected on behalf of third parties.

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made.

The specific recognition criteria described below must also be met before revenue is recognized:

- The Company has transferred risk and rewards incidental to ownership to the customer.

- The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold.

- It is probable that the economic benefits associated with the transactions will flow to the Company

- It can be reliably measured and it is reasonable to expect ultimate collection.

Sale of goods

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates. No element of financing is deemed present as the sales are made with a credit term which is consistent with market practice.

Sale of services:

In contracts involving the rendering of services, revenue is measured using the proportionate completion method when no significant uncertainty exists regarding the amount of the consideration that will be derived from rendering the service and are recognised net of service tax/ GST.

All other income is accounted on accrual basis when no significant uncertainty exists regarding the amount that will be received.

1.19 Government Grants

Grants from the Government are recognised when there is reasonable certainty that the grant will be received and all attaching conditions will be complied with.

Grants relating to property, plant and equipment are included in Non-current liabilities as deferred income and are credited to Profit and loss on fulfillment of associated condition.

1.20 Borrowing Cost

Borrowing costs include interest, other costs incurred in connection with borrowing. General and specific borrowing costs directly attributable to the acquisition, construction, production or development of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in Statement of Profit and Loss in the period in which they are incurred.

1.21 Provisions and Contingent liabilities

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

A contingent liability is disclosed when there is a possible obligation that arises from events and whose existence is only confirmed by one or more doubtful future events or when there is an obligation that is not recognised as a liability or provision because it is not likely that on outflow of resources will be required

1.22 Dividends

Final dividends on shares are recorded on the date of approval by shareholders of the company.

1.23 Segment reporting

The Company is primarily engaged in the business of “manufacturing of components” for automobiles for Indian market which is governed by the same set of risks and returns. Hence there is only one business and geographical segment. Accordingly, segment information has not been disclosed.

1.24 Recent Accounting Pronouncements

(a) Ind AS 115-Revenue from Customers

On March 28, 2018 Ministry of Corporate Affairs (“MCA”) has notified the Ind AS 115, Revenue from Contract with Customers. The core principle of the new standard is that an entity should recognise revenue when the control of goods or services underlying the particular performance obligation is transferred to customers. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainties of revenue and cash flows arising from the underlying terms and conditions of the contract between the entity and customer. An entity may choose to apply the new standard to its historical transactions and retrospectively adjust each comparative period. Alternatively, an entity can recognise the cumulative effect of applying the new standard at the date of initial application and make no adjustments to its comparative information (Catch up transition Method). The chosen transition option can have a significant effect on revenue trends in the financial statements. A change in the timing of revenue recognition may require a corresponding change in the timing of recognition of related costs. The standard is effective for annual periods beginning on or after 1 April 2018. The Company is currently evaluating the requirements of Ind AS 115, and has not yet determined the impact on the financial statements.

(b) Appendix B to Ind AS 21, Foreign currency transactions and advance consideration

On March 28, 2018 MCA has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Appendix B to Ind AS 21, Foreign currency transaction and advance consideration which clarifies the date of the transaction for the purpose of determining the exchange rate to use an initial recognition of the related asset, liability, expense or income, when an entity has received or paid advance consideration in a foreign currency. The amendment will come into force from April 1, 2018. The Company has evaluated the effect of this on the financial statements and impact is not material.

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Mar 31, 2016

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements are prepared on a going concern basis under the historical cost convention on accrual basis of accounting in accordance with the generally accepted accounting principles and Accounting Standards notified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules 2014.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets (including Assets given on Lease) are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat /Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on pro-rata basis on the straight line method over the estimated useful lives of the fixed assets as the manner prescribed in Schedule II to the Companies Act, 2013.

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value whichever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

''Monetary Assets and Liabilities hedged by a hedge contract are expressed in Indian Rupees at the rate of exchange prevailing on the date of Balance Sheet adjusted to the rates in the hedge contract. The exchange difference arising either on settlement or at reporting date is recognized in the Statement of Profit and Loss except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets

Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, this amended Accounting Standard 11 on the Effects of changes arising during the year, in so far as they relate to the acquisition of a depreciable capital asset are added to/deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly,

i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident Fund Organization. Contribution to the said Organization paid/ payable during the year is recognized in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation unfunded and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognized and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India. Other Borrowing Costs are charged to Profit and Loss Statement.

8) TAXES ON INCOME

a) Provision for current tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-''Acounting for Taxes on Income'' issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.

13) CASH & CASH EQUIVALENTS

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all investments that are readily convertible to known amounts of cash to be cash equivalents.

14) USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires the Management to Make estimates and assumptions that the affect the reported balances of assets and Liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision is recognized prospectively in current and future period.

15) CASH FLOW STATEMENT

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

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Mar 31, 2015

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements are prepared on a going concern basis under the historical cost convention on accrual basis of accounting in accordance with the generally accepted accounting principles and Accounting Standards notified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules 2014.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets (including Assets given on Lease) are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat /Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on pro-rata basis on the straight line method over the estimated useful lives of the fixed assets as the manner prescribed in Schedule II to the Companies Act, 2013.

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value which ever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

'Monetary Assets and Liabilities hedged by a hedge contract are expressed in Indian Rupees at the rate of exchange prevailing on the date of Balance Sheet adjusted to the rates in the hedge contract. The exchange difference arising either on settlement or at reporting date is recognized in the Statement of Profit and Loss except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets

Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, this amended Accounting Standard 11 on the Effects of changes arising during the year, in so far as they relate to the acquisition of a depreciable capital asset are added to/deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly,

i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident Fund Organisation. Contribution to the said Organisation paid/ payable during the year is recognised in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation unfunded and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognised and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India. Other Borrowing Costs are charged to Profit and Loss Statement.

8) TAXES ON INCOME

a) Provision for current tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-'Acounting for Taxes on Income' issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.

13) CASH & CASH EQUIVALENTS

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all investments that are readily convertible to known amounts of cash to be cash equivalents.

14) USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires the Management to Make estimates and assumptions that the affect the reported balances of assets and Liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision is recognized prospectively in current and future period.

15) CASH FLOW STATEMENT

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

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Mar 31, 2014

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles and applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets (including Assets given on Lease) are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat /Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 as amended except in the case of following assets for which depreciation has been provided at higher rates based on the useful life as determined by Management :

Additions to Communication Equipments (w.e.f. 01.04.2001) 20% Machinery acquired after expiry of lease term 20% Utilities 20%

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value which ever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

‘Monetary Assets and Liabilities hedged by a hedge contract are expressed in Indian Rupees at the rate of exchange prevailing on the date of Balance Sheet adjusted to the rates in the hedge contract. The exchange difference arising either on settlement or at reporting date is recognized in the Statement of Profit and Loss except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets

Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, this amended Accounting Standard 11 on the Effects of changes arising during the year, in so far as they relate to the acquisition of a depreciable capital asset are added to/ deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly,

i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident Fund Organisation. Contribution to the said Organisation paid/ payable during the year is recognised in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation unfunded and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognised and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India. Other Borrowing Costs are charged to Profit and Loss Statement.

8) TAXES ON INCOME

a) Provision for current tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-‘Acounting for Taxes on Income'' issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.

13) CASH & CASH EQUIVALENTS

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all investments that are readily convertible to known amounts of cash to be cash equivalents.

14) USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires the Management to Make estimates and assumptions that the affect the reported balances of assets and Liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision is recognized prospectively in current and future period.

15) CASH FLOW STATEMENT

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

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Mar 31, 2013

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles and applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat / Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis. Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 as amended except in the case of following assets for which depreciation has been provided at higher rates based on the useful life as determined by Management :

Additions to Communication Equipments (w.e.f. 01.04.2001) 20%

Machinery acquired after expiry of lease term 20%

Utilities 20%

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value which ever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

Monetary Assets and Liabilities hedged by a hedge contract are expressed in Indian Rupees at the rate of exchange prevailing on the date of Balance Sheet adjusted to the rates in the hedge contract. The exchange difference arising either on settlement or at reporting date is recognized in the Statement of Profit and Loss except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets

Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, this amended Accounting Standard 11 on the Effects of changes arising during the year, in so far as they relate to the acquisition of a depreciable capital asset are added to/deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly,

i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident

Fund Organisation. Contribution to the said Organisation paid/ payable during the year is recognised in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation unfunded and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognised and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India. Other Borrowing Costs are charged to Profit and Loss Statement.

8) TAXES ON INCOME

a) Provision for current tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-''Acounting for Taxes on Income'' issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.

13) CASH & CASH EQUIVALENTS

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all investments that are readily convertible to known amounts of cash to be cash equivalents.

14) USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires the Management to Make estimates and assumptions that the affect the reported balances of assets and Liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision is recognized prospectively in current and future period.

15) Cash Flow Statement

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

---

Mar 31, 2012

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles and applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat / Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 as amended except in the case of following assets for which depreciation has been provided at higher rates based on the useful life as determined by Management :

Additions to Communication Equipments (w.e.f. 01.04.2001) 20%

Machinery acquired after expiry of lease term 20%

Utilities 20%

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value which ever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

' Monetary Assets and Liabilities hedged by a hedge contract are expressed in Indian Rupees at the rate of exchange prevailing on the date of Balance Sheet adjusted to the rates in the hedge contract. The exchange difference arising either on settlement or at reporting date is recognized in the Statement of Profit and Loss except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, this amended Accounting Standard 11 on the Effects of changes arising during the year, in so far as they relate to the acquisition of a depreciable capital asset are added to/deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly,

i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident Fund Organisation. Contribution to the said Organisation paid/ payable during the year is recognised in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation unfunded and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognised and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India. Other Borrowing Costs are charged to Profit and Loss Statement.

8) TAXES ON INCOME

a) Provision for current tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-' Acounting for Taxes on Income' issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.

13) CASH & CASH EQUIVALENTS

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all investments that are readily convertible to known amounts of cash to be cash equivalents.

14) USE OF ESTIMATES

The preparation of the financial statements in conformity with GAAP requires the Management to Make estimates and assumptions that the affect the reported balances of assets and Liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues and expenses for the year. Actual results could differ from these estimates. Any revision is recognized prospectively in current and future period.

15) Cash Flow Statement

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

---

Mar 31, 2010

1) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under the historical cost convention, on accrual basis and in accordance with the generally accepted accounting principles and applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

2) FIXED ASSETS AND DEPRECIATION

Fixed Assets are stated at cost of acquisition or construction, which comprises of purchase price (net of Modvat / Cenvat /rebate and discounts, wherever applicable) and any directly attributable cost of bringing the asset to its working condition for the intended use. Expenditure during construction period including borrowing cost, wherever applicable, is allocated on the direct cost of the relevant assets on a pro-rata basis.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on Straight Line Method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956 as amended except in the case of following assets for which depreciation has been provided at higher rates based on the useful life as determined by Management :

Additions to Communication Equipments (w.e.f. 01.04.2001) 20%

Machinery acquired after expiry of lease term 20%

Utilities 20%

b) Depreciation on assets added /sold during the year is provided on pro rata basis with reference to the date of addition/disposal of the respective assets.

c) Depreciation on incremental cost arising on account of premium on forward contract of foreign currency liabilities for acquisition of fixed assets has been provided as aforesaid over the residual life of the respective assets.

d) Individual assets costing Rs. 5,000/- or less are depreciated in full.

e) Leasehold land is amortized equally over unexpired period of lease from the date it is put to use.

3) INVENTORIES

a) Raw materials, components, stores & spares are valued at cost on First in First out (FIFO) basis or net realizable value which ever is lower. The cost is arrived at after deducting the cenvat credit.

b) Finished goods and work in process are valued at lower of cost or net realizable value. Cost is arrived at by absorption costing method. Finished goods and work in process includes cost of conversion incurred in bringing the inventories to its present location and condition.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

4) RECOGNITION OF INCOME AND EXPENDITURE

a) Sales are recognized, net of returns, on dispatch of goods to customers and are recorded gross of excise duty and net of sales tax and discounts.

b) Insurance claims made by the company are accounted for at the time of their acceptance.

c) Product warranty claims are charged to the Profit & Loss account as and when claimed by the customers on actual basis.

d) Liability on account of customs duty on imported material in transit is accounted in the year in which the goods are cleared from the customs.

e) Individual prior period items up to Rs. 20,000/- are treated as income/expenditure for the current year.

5) FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities (monetary items) are reported at the exchange rate prevailing on the balance sheet date.

Pursuant to the notification of the Companies (Accounting Standards) Amendment Rules 2006 on 31 March 2009, which amended Accounting Standard 11 on the Effects of foreign currency changes arising during the year, in so far as these relate to the acquisition of a depreciable capital assets are added to/deducted from the cost of the asset and depreciated over the balance life of the asset.

6) EMPLOYEE BENEFITS

Employee benefits have been recognized in accordance with revised AS-15. Accordingly, i) Long term compensated absences are provided for based on actuarial valuation at the end of each financial year.

ii) Provident Fund is a defined contribution scheme and the same is administered through Regional Employees Provident Fund Organisation. Contribution to the said Organisation paid/ payable during the year is recognised in the Profit and Loss account. The shortfall, if any, between the return guaranteed by the Fund and actual earnings of the Fund is provided for by the holding company and contributed to the Fund.

iii) Gratuity liability is a defined benefit obligation and is fully provided for on the basis of actuarial valuation made at the end of each financial year. The actuarial valuation is made on Projected Unit Credit (PUC) method.

iv) Actuarial gains/losses are immediately recognised and are not deferred.

7) BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised/ charged to revenue in accordance with the Accounting Standard-16 issued by the Institute of Chartered Accountants of India.

8) TAXES ON INCOME

a) Provision for current tax and Fringe Benefit Tax is made in accordance with and at the rates specified under the Income Tax Act, 1961, as amended. Tax expenses are accounted in the same period to which the revenue and expenses relate.

b) Provision for deferred tax is made in accordance with Accounting Standard 22-‘Acounting for Taxes on Income issued by the Institute of Chartered Accountants of India. The deferred tax charge or credit is recognized, using current tax rates, for timing differences between book and tax profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only when there is virtual certainty of realization of such assets in future. Such assets are reviewed at each balance sheet date to reassess realization.

9) REDEMPTION PREMIUM ON FOREIGN CURRENCY CONVERTIBLE BONDS

Premium payable on redemption of FCCB as per terms of issue is provided fully in the year of issue.

10) IMPAIRMENT OF ASSETS

An Asset is treated as impaired when its carrying cost exceeds its recoverable amount on the reporting date. An impairment loss is charged to the Profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior periods is reversed if there has been a change in the estimate of recoverable amount. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows.

11) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

12) PROPOSED DIVIDEND:

Dividend on Share Capital, if proposed by the Directors, is provided in the books.