Accounting Policies of Salora International Ltd. Company

Mar 31, 2024

2 Material Accounting Policy information

2.01 Property plant and equipment (PPE):

Property, plant and equipment are stated at cost, less accumulated depreciation and impairment, if any. The company depreciates property, plant and equipment over their estimated useful lives on Straight Line Method. The estimated useful lives of assets are as follows:-

Category Useful Life

Buildings (including roads) 30- 60 Years

Plant & Equipment 15 Years

Mould & Dies 8 Years

Furniture & Fixture 10 years

Office Equipment 5 Years

Vehicles 8 - 10 Years

Computer 3 Years

The useful lives for these assets is in compliance with the useful lives as indicated under Part C of Schedule II of the Companies Act, 2013

Addition to the property plant and equipment have been accounted for on the date of installation irrespective of date of invoice. Depreciation on asset added /sold/discarded during the year is being provided on prorata basis from/ upto the date on which such assets are added/sold/discarded. Leasehold Land is amortized over the period of lease. Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non financial assets and the cost of assets not ready for use before such date are disclosed under ''Capital work-in-progress''

2.02 Leases-(Right of use)

The Company enters into hiring/service arrangements for various assets. The Company evaluates whether a contract contains a lease or not, in accordance with the principles of Ind AS 116. This requires significant judgements including but not limited to, whether asset is implicitly identified, substantive substitution rights available with the supplier, decision making rights with respect to how the underlying asset will be used, economic substance of the arrangement, etc.

As a lessee the Company has measured lease liability at the present value of the remaining lease payments, discounted using the incremental borrowing rate at the date of initial application. After the commencement date / transition date, The Company measures the right-of-use asset applying a cost model, where the Company measures the right-of-use asset at cost:

(a) less any accumulated depreciation and any accumulated impairment losses; and

(b) adjusted for any remeasurement of the lease liability

The Company recognises the finance charges on lease expense on reducing balance of lease liability. The Right of use asset is depreciated over the lease term on straight line basis.

The Company applies the above policy to all leases except:

(a) leases for which the lease term (as defined in Ind AS 116) ends within 12 months of the acquisition date

(b) leases for which the underlying asset is of low value (lease having monthly rental less than ? 5000)

As a lessor the Company identifies leases as operating and finance lease. A lease is classified as a finance lease if the Company transfers substantially all the risks and rewards incidental to ownership of an underlying asset. For Operating leases as a lessor the Company recognises lease payments from operating leases as income on straight-line basis.

Lease liability and ROU asset have been separately presented in the Balance Sheet and lease payments have been classified in financing activities in cash flows.

2.03 Financial instruments

(i) Initial recognition

All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities that are not at fair value through profit or loss, are adjusted from the fair value of financial assets / financial liabilities on initial recognition.

(ii) Subsequent measurement

a) Financial assets carried at amortized cost

A financial asset is subsequently measured at amortized 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 date to cash flows that are solely payments of principal and interest on the principal amount outstanding.

b) Financial assets carried at fair value through profit or loss

A financial asset which is not classified as subsequently measured at amortised cost is subsequently fair valued through profit or loss.

c) Financial liabilities

Financial liabilities are subsequently carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the Balance sheet date, the carrying amount approximate fair value due to the short maturity of these instruments.

d) Equity instruments

Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs.

2.04 Impairment:

Financial assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables is measured at an amount equal to lifetime ECL. For all other financial assets, ECLs are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of ECLs (or reversal) that is required to adjust loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in profit or loss.

The company considers financial assets as credit impaired which are outstanding for more than 3 years in case of trade receivables.

2.05 Inventories

a) Inventories are valued at cost or net realisable value whichever is lower.

b) Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads.

c) Cost is calculated on FIFO basis in respect of mainily trading goods and on weighted average basis in respect of manufatured goods.

2.06 Revenue from contacts with customers

Revenue is the transaction price the Company expects to be entitled to. In determining the transaction price, the Company considers effects of variable consideration, the existence of significant financing component, non cash consideration and consideration payable to the customer, if any. The Company considers whether there are other promises in the contract that are separate performance obligations to which the transaction price needs to be allocated (e.g. warranties etc.).

Variable consideration

If the consideration in a contract includes a variable amount, the company estimates the amount of consideration to which it will be entitled to in exchange for transferring goods to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant reversal of revenue will not occur once associated uncertainties are resolved. Some contracts with the customers provide them with a right to return and volume rebates. The right to return and volume rebates gives rise to variable consideration. The amount of variable consideration is calculated by either using the expected value or the most likely amount depending on which is expected to better predict the amount of variable consideration.

Sale of products

The Company recognizes revenues on the sale of products, net of returns and trade discounts at a point in time when customer obtains control of the goods, provided a contract with enforceable rights and obligations exists. Customer obtains control of goods based on the contracted terms either on dispatch from factory premises or on delivery at the customer''s premises, as the case may be.

Other operating revenue

Other operational revenue represents income earned from activities incidental to the business and is recognised when right to receive the income is established.

Other Income

Interest income from a financial asset is recognized using the effective interest rate.

Other income is recognized on accrual basis.

2.07 Employee benefits

Short term employee benefits :

Benefits like salaries, wages, leave salary, contribution to Provident Fund/ Employee State Insurance contributions etc. paid or payable during the reporting period and the expected bonus expense are recognised as an expense on an undiscounted basis in the period in which the employee renders the related service.

Long term employee benefits :

Compensated absesnce:

The liability for leave encashment and other compensated absences is recognized on the basis of actuarial valuation made at the end of the year.

Post -employment benefits

a) Defined contribution plan

Defined Contribution Plans for Provident Fund, Family Pension benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis. The contribution paid /payable under the schemes is recognised during the period in which employee renders the related service.

b) Defined benefit plan

The Company''s Gratuity is Defined Benefit Retirement Plan. The Company ''s liability towards Gratuity is determined using the Projected Unit Credit Method which recognises each period of service as giving rise to additional unit of employee benefit entitlement.

The liability is provided based on actuarial valuation certified by consulting actuary. The Company recognizes the net obligation of a defined benefit plan in its balance sheet as an asset or liability. Remeasurements comprising of actuarial gains and losses, the effect of the asset ceiling (excluding amounts included in net interest on the net defined benefit liability) and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability) relating to retirement benefit plans are recognised in Other Comprehensive Income which are not reclassified to profit or loss in subsequent periods.

2.08 Income taxes

The accounting treatment followed for taxes on income is to provide for Current Income Tax and Deferred Income Tax. Income tax expense is recognized in the net profit in the Statement of Profit and Loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in other comprehensive income. Current income tax for current and prior period is the aggregate amount of income tax determined as payable in respect of taxable income for the period, using the tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Income Tax asset and liability are recognized for all temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements except when the deferred income tax arises from the initial recognition of an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction. Deferred Income tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Deferred tax is recognised based on the balance sheet approach, on temporary differences arising between the tax bases of assets and liabilities and their carrying values in the financial statements. Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred tax is determined using tax rates that have been enacted or substantively enacted at the reporting date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

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Mar 31, 2016

i) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,2013.

ii) Revenue Recognition :

Sales are recognized on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Service Income is recognized as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets ( except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognized as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognized to statement of Profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortization.

b. Depreciation on Fixed Assets :

Depreciation on Fixed Assets is provided as per Straight Line method on the basis of useful life of assets specified and in the manner specified in the Schedule II of the Companies Act, 2013. Depreciation is charged on pro-rata basis on Additions/Sales during the year. Depreciation on assets whose actual cost do not exceed R5000/- has been charged 100% without pro-rata basis. Cost of leasehold land and furnishing expenses in leasehold property are amortized over the lease period. Intangible assets are amortized over the useful life of such assets.

iv) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long term investments are stated at cost. Provision for diminution is made to recognize a decline, other than temporary, in the value of long term investments.

v) Inventory Valuation

a. Inventories are valued at cost or net realizable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vi) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duty is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

vii) Employee Benefits :

a. Short term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognized by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognized as an expense in the statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognized at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the statement of Profit and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to statement of Profit & Loss as incurred under the relevant Act.

e. Gratuity is charged to statement of Profit & Loss on the basis of actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to statement of Profit & Loss.

viii) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to statement of Profit & Loss.

ix) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed business loss and unabsorbed depreciation under tax laws, are recognized, only if there is a virtual certainty of its realization, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized only to the extent there is a reasonable certainty of its realization. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realization.

x) Contingent Liabilities and Assets :

Contingent liability is recognized and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognized until the realization of income is virtually certain.

35 Contingent Liabilities not provided for in respect of :

i) Bank Guarantees issued by Bankers R255.47 lacs (Previous year R701.18 lacs) including for Sales Tax and Excise demand R5.47 Lacs (Previous Year R1.18 lacs), against which margin kept by bank R1.18 lacs ( Previous year R68.68 lacs)

ii) Letter of Credits pending for shipment R315.47 lacs (Previous year R220.98 lacs. ).

iii) TV sets, VCD''s and Office Automation products still under warranty for which amount is not ascertainable.

iv) Disputed Sales Tax demands of R888.77 lacs (Previous year R658.24 lacs), against which amount deposited R191.12 lacs (Previous year R178.15 lacs) has not been provided for as the cases are pending in appeals with higher authorities.

v) Advance Licence utilized for Import of CPT worth R87.50 lacs during the period from January, 1995 to May 1995, DGFT issued Show Cause Notice to pay duty and penalty thereof on all above imports and included the company''s name in the defaulters list. Company challenged the said Notice in Delhi High Court and after admitting the petition and taking into consideration all the facts, the Delhi High Court directed the Company to deposit a sum of R20.00 lacs with the Collector of Customs and ordered DGFT to remove Company''s name from the defaulters list. Accordingly Company has deposited the sum of R20.00 lacs within the time stipulated by the Court. Duty and penalty amount is not ascertainable at this stage.. Petition has been refiled against appeal order by DGFT. Custom Department has raised demand of R20.14 lacs for the year 2015-16 against amount of drawback for which company has deposited Rs. 20.14 lacs under protest and appeal has been filed against the order by DGFT.

vi) The demand amounting to R1113.77 lacs (previous year R1113.77 lacs) and penalty R1113.77 lacs (previous year R1113.77 lacs) for the period April 2002 to April 2003 and demand of R28.99 lacs (previous year R28.99 lacs) and penalty of R28.99 lacs (previous year R28.99 lacs) for the period July 1993 to February 1994 are on the basis of differential duty on Chassis, Sub assembly parts of T.V. considered as T.V. The Honorable Supreme Court has decided on the classification issue for the period 1989-90 and the facts of these cases are different from the case decided by the Supreme Court. The company had gone in appeal before CESTAT. The appeal before CESTAT were remanded back to the Commissioner Adjudication to decide afresh while considering the differential facts of the case. The Commissioner has decided the cases against the company without considering the differential facts as per directions given by CESTAT in remand order. The company has again filed appeal against Commissioner''s order before the CESTAT. The demand for R1292.45 lacs (previous year R1292.45 lacs) lacs and penalty R1292.45 lacs (previous year R1292.45 lacs) for the period June 1998 to March

2002 raised on the same basis by the department is time barred and case had been decided in favour of the company. The department had gone in appeal before CESTAT. The CESTAT had remanded this matter to Commissioner Adjudication who has decided the case against the company without considering direction / differential facts of the CESTAT. The company has again filed appeal on the matter before CESTAT. Therefore considering directions / differential facts given by CESTAT in remand order not considered in Commissioner''s orders, the company has good case on merits. Demand deposited amounting to R300 lacs ( previous year R300.00 lacs).Miscellaneous Excise duty demand amounting to R98.84 lacs( previous year R98.84 lacs) and Service Tax demand R1.97 lacs (previous year R1.97 lacs) has been raised by the department against which company has filed appeals. The amount deposited against demand R14.03 lacs ( previous year R9.66 lacs).

vii) Income Tax Assessments of the Company have been completed upto Assessment Year 2013-2014 (in previous year upto 2012-13). Demand has been raised of R45 lacs(previous year R57.57 lacs) for earlier assessment years against which company has filed appeal before apple ate authorities and amount R40.43 lacs(previous year R53.00 lacs) has been deposited against demands. Appeal of Income Tax department against the ITAT order for the Assessment Year 1997-98 is lying pending before Hon''ble Delhi High Court against refund of R1151.57 lacs (previous year 1151.57 lacs) received by the Company in the Financial Year 2002-2003.

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Mar 31, 2015

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,2013.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets ( except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of Profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Persuant to Companies Act, 2013 ('the Act') being effective from 1April 2014, the Company has revised Depreciation rates on tangible fixed assets as per the usefull life specified in part 'C' of schedule II of the Act. Depreciation on Fixed Assets is provided as per Straight Line method on the basis of useful life of assets specified and in the manner specified in the Schedule II of the Companies Act, 2013. Depreciation is charged on pro-rata basis on Additions/Sales during the year. Depreciation on assets whose actual cost do not exceed Rs.5000/- has been charged 100% without pro-rata basis. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Intangible assets are amortised over the useful life of such assets.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of Profit and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the customizability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and otherlong term benefits are charged to the statement of Profit and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to statement of Profit & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to statement of Profit & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. ) Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. ) Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to statement of Profit & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to statement of Profit & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.

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Mar 31, 2014

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets (except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956. Depreciation is charged on pro-rata basis on additions/ sales during the year. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition. Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of profit and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all risk and rewards of ownership are classifed as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments :

Investments are classifed into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long- term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured fnished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of fnished goods.

c. Cost is calculated on weighted average basis.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on fnished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on fnished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the statement of profit and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the statement of profit and Loss.

d. Contribution to Employees'' Provident Fund and Family Pension Scheme are charged to statement of profit & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to statement of profit & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees'' Gratuity & Leave pay paid is charged to statement of profit & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to statement of profit & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.

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Mar 31, 2013

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty.Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets (except freehold land) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fxed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fxed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of Proft & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation/amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956. Depreciation is charged on pro-rata basis on additions/ sales during the year. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Assets purchased after 15.12.1993 the actual cost of which does not exceed R 5000/- are written off in the year of acquisition. Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of Proft and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all the risk and rewards of ownership are classifed as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease, whichever lower.

v) Investments :

Investments are classifed into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured fnished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of fnished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identifed at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on fnished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on fnished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefts :

a. Short term employee benefts are recognised as an expense at the undiscounted amount in the statement of Proft and Loss of the year in which the related service is rendered.

b. Defned Contribution Plans for Provident fund, Family pension and Superannuation benefts are recognised by contribution at specifed rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefts Gratuity and Leave Pay are recognised as an expense in the statement of Proft and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefts are charged to the statement of Proft and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to statement of Proft & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefts are charged to statement of Proft & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to statement of Proft & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the fnancial year and exchange difference is charged to statement of Proft & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outfow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outfow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.

---

Mar 31, 2012

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable. Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets (except freehold land) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. Claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each. Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to Statement of Profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956. Depreciation is charged on pro-rata basis on additions/ sales during the year. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Assets purchased after 15.12.1993 the actual cost of which does not exceed R 5000/- are written off in the year of acquisition. Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the Statement of Profit and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all the risk and rewards of ownership are classifed as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease, whichever lower.

v) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long- term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefits’ :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the Statement of Proft and Loss of the year in which the related service is rendered.

b. Defend Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the Statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Statement of Profit and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to Statement of Profit & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to Statement of Profit & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to Statement of Profit & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to Statement of Profit & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.

---

Mar 31, 2011

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities.

Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets ( except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets.

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred.

Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to Profit & Loss Account.

Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956.

Depreciation is charged on pro-rata basis on additions/ sales during the year.

Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period.

Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition.

Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the Profit and Loss Account on a straight-line basis over the lease term.

Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease.

Such assets acquired are capitalised at fair value of the assets or present value of the minimum lease payments at the inception of the lease, whichever lower.

v) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to Profit & Loss Account as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to Profit & Loss Account on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to Profit & Loss account.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to Profit & Loss Account

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.

---

Mar 31, 2010

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act, 1956.

ii) Revenue Recognition:

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty.Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets:

Fixed assets (except freehold land) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat.Vat etc. claimed on fixed assets is reduced from the cost of respective assets.

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred.

Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to Profit & Loss Account.

Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956.

Depreciation is charged on pro-rata basis on additions/ sales during the year.

Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period.

Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition.

Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the Profit and Loss Account on a straight-line basis over the lease term.

Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease.

Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments:

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporaryin the value of long term investments.

vi) Inventory Valuation:

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port/ warehouse of the custom.Liability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,VAT under CENVAT scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under CENVAT scheme on expenses is reduced from expenses. viii) Employee Benefits:

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss account of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to Profit & Loss Account as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to Profit & Loss Account on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f.) Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year. g.) Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to Profit & Loss account. ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to Profit & Loss Account.

x) Taxation:

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation. xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.