Accounting Policies of Samkrg Pistons & Rings Ltd. Company

Mar 31, 2024

OTHER INFORMATION:

1. CORPORATE INFORMATION: Samkrg Pistons and Rings Limited (the company) is engaged in the Manufacturing of Automobile components. The Company has manufacturing plants at Bonthapally, Sanga Reddy Dist. (T.S.) and two units at Srikakulam District, Andhra Pradesh. The Company is a Public Limited Company and is listed on the Bombay Stock Exchange. The Functional Currency of the company is Indian Rupees. The Financial Statements prepared under Company (Accounting Standards) Rules, 2015, as amended for the year ended 31^st March,2024 were adopted by the company as on 29^th MAY 2024.

SIGNIFICANT ACCOUNTING POLOCIES

1. BASIS OF PREPARATION

The Financial Statements have been prepared in accordance with Section 133 of the Companies Act, 2013, Indian Accounting Standards (Ind AS) notified under Companies (Indian Accounting Standards) Rules, 2015. The Financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all periods presented in the financial statements. All assets and liabilities have been classified as current and non-current as per the Company’s normal operating cycle and other criteria as set out in the Division II of Schedule III of the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realization in cash and cash equivalents the company has ascertained its operating cycle as 12 months for the purpose of current or non-current classification of assets.

Transactions and balances with values below the rounding off norm adopted by the company have been reflected as “0” in the relevant notes in these financial statements.

The Financial Statements of the Company for the year ended 31/03/2024 were approved for issue in accordance with the resolution of the board of directors on 29/05/2024

2. Basis of Measurement: These Financial Statements are prepared under historical cost convention unless otherwise stated.

3. Revenue Recognition: Revenue from contracts with customers are recognized as per Ind AS 115 when control of the goods or services are transferred to the customers at the fair value of consideration received or receivable. The Company recognizes revenue when the same can be reliably measured, it is probable that future economic benefits will flow to the Company and specific criteria have been met for each of the Company’s activities as described below. Revenue is measured at the value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government. Amounts disclosed as revenue are exclusive of GST and net of returns, trade allowances, rebates, discounts, and amounts collected on behalf of third parties.

(i) Sale of Goods

Sales are recognized when substantial risk and rewards of ownership are transferred to customer, In case of domestic customers, sales generally take place when goods are dispatched or delivery is handed over to the transporter. In case of export customers, sales generally take place when goods are shipped on-board based on bill of lading.

ii) Interest Income is recognized on time proportion basis taking into account the amount invested and rate of interest.

iii) Revenue in respect of other claims is recognized on accrual basis to the extent the ultimate realization is reasonably.

4. Expenses are accounted on accrual basis.

5. Employee Benefits:

(i) Contributions to defined contribution schemes such as ESI, Labour welfare fund, employee pension scheme are charged as expense based on the amount of contribution required to be made as and when services are rendered by the employees. Companies provident fund contribution in respect of certain employees is made to government administered fund and charged as an expense to the statement of profit and loss. The above benefits are classified as Defined contribution schemes as the company has no further defined obligations beyond the monthly contribution.

(ii) Defined benefit plans: In accordance with payment of Gratuity Act, 1972, the company provides gratuity a defined benefit retirement plan covering eligible employees. The plan provides for a payment to vested employees at retirement, death while in employment or on termination of employment, an amount equivalent to 15 days salary payable for each completed year of service, subject to maximum as may be prescribed. Vesting occurs upon completion of five years of service, except in case of death while in employment in which case the legal heirs would receive the gratuity. Accordingly, a lump sum provision is made as per management policy.

6. Property, Plant and Equipment: Property, plant and equipment are stated at acquisition cost includes related duties freight etc., and interest on borrowed fund if any directly attributable to acquisition/ construction of qualifying fixed assets and is net of duty/tax credit availed.

Subsequent expenditure related to an item of property, plant and equipment are added to book value only if they increase the future benefits from existing asset beyond its previously assessed standard of performance. In all such cases, the useful life of assets subsequently added to parent asset are brought at par and depreciated in line with parent asset.

Losses arising from the retirement of, and gains or losses arising from disposal of property, plant and equipment which are carried at cost are recognized in statement of profit or loss.

Depreciation is provided on SLM basis, based on useful life of the assets in accordance with Schedule II of the Companies Act, 2013.

Free hold land is not depreciated.

The residual value of 5% is retained in books for all assets other than the assets whose useful life has elapsed as on 01-04-2014 or those assets whose book value has already been reduced below 5% of acquisition cost.

The depreciation has been provided on SLM basis based on the life of the asset given below:

- Building 30 years

- Plant and Machinery 15 years

- Lab Equipment 10 years

- Electrical Installation 10 years

- Office Equipment 5 years

- Vehicles 8 years

- Computers 3 years

De-recognition: The carrying amount of an item of property, plant and equipment shall be derecognized

(i) On disposal or

(ii) When no future economic benefits are expected from its use or disposal

7. Intangible Assets: Separately purchased intangible assets are initially measured at cost. Subsequently, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses if any.

The useful lives of intangible assets are assessed as either finite or indefinite. Finite life assets are amortized on a straight-line basis over the period of their expected useful lives.

Estimated useful lives by major class of finite life intangible assets are as follows:

Computer Software 10 Years

The amortization period and amortization method for finite life intangible assets is reviewed at each financial year and adjusted prospectively, if appropriate.

8. Foreign Currencies: The Company’s financial statements are presented in INR, which is also the functional currency of the company.

Transactions and Balances: Transactions in foreign currencies are initially recognized by the company at its functional currency spot rates at the date the transaction when it first qualifies for recognition.

Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date.

Exchange differences arising on settlement or translation of monetary items are recognized in profit and loss statement.

9. Income Taxes: Income tax expense for the year comprises of current tax and deferred tax. It is recognized in profit and loss.

Current tax is the expected tax payable / receivable on the taxable income / loss for the year using applicable tax rates at the Balance Sheet date, and any adjustment to taxes in respect of the previous years.

Deferred tax is recognized in respect of temporary differences between carrying amount of assets and liabilities for financial reporting purposes and corresponding amounts used for taxation purposes.

A deferred tax liability is recognized based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantially enacted by the end of the reporting period.

A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realized.

10. Dividend: Final Dividend on shares are recorded as a liability on the date of approval by the shareholders.

11. Use of Estimates: The preparation of Financial Statements is in conformity with Indian accounting standards (Ind AS), requires the management to make estimates and assumptions considered in the reported amount of assets and liabilities and disclosure relating to contingent liabilities as at the date of financial statements and reported income and expenses during the year. The management believes that the estimates used in preparation of financial statements are prudent and reasonable. Future results could differ due to these estimates and differences between actual results and estimates are recognized in the periods in which results are known / materialize.

12. Financial Instruments: Financial Assets and Financial Liabilities are recognized when the company becomes a party to contractual provisions of the instrument.

A Financial Asset is:

• Cash

• A Contractual right to receive cash or another Financial Asset.

• A Contractual right to exchange Financial Assets or Liabilities with another entity under potentially favorable conditions; or

• An equity instrument of another entity.

A Financial Liability is:

• A Contractual obligation to deliver cash or another financial asset; or

• To exchange Financial Instruments with another entity under potentially unfavorable conditions.

A derivative is a Financial Instrument that derives its value from underlying price or index; requires little or no initial net investment; and is settled at a future date.

IND AS 109 divides all Financial Assets into Two Classifications:

Those measured at amortised at cost.

Those measured at Fair Value.

When assets are measured at fair value, gains and losses are recognized entirely in profit or loss (Fair value through profit or loss, FVTPL), or recognized in other comprehensive income (Fair value through other comprehensive income, FVTOCI).

The classification of Financial Asset is made at the time it is initially recognized, namely when the entity becomes a party to contractual provisions of the instrument.

13. Provisions and contingent liabilities:

(a) Provisions: Provisions are recognized when there is a present obligation 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 there is a reliable estimate of the amount of the obligation.

Current provisions are measured at the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date and are not discounted to its present value.

(b) Contingent Liabilities: Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed by the occurrence of non-occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is probable that an outflow of resources will be required to settle of reliable estimate of the amount cannot be made.

14. Cash and cash equivalents: In the cash flow statement, cash and cash equivalents include cash, demand deposits with banks, other short term highly liquid investments with original maturities of three months or less.

15. Segment Reporting under Ind AS-108:

The Company is engaged in a single segment (i.e. the business of “automotive components” from where it is earning its revenue and incurring expenses. The operating results are regularly reviewed and performance

is assessed by its Chief Operating Decision Maker (CODM). All the company resources are dedicated to this single segment and all the discrete financial information is available for this segment. The geographical information in respect of customers

Is given in Note 38, Notes to accounts and Significant accounting policies.

16. IND AS-23 BORROWING COST: Ind AS 23, ‘Borrowing Costs’ The amendments clarify that if a specific borrowing remains outstanding after the related qualifying asset is ready for its intended use or sale, it becomes part of general borrowings. As the Company does not have any borrowings, there is no impact on account of this amendment.

17. UNCERTAINITY OVER INCOME TAX TREATMENTS TO IND AS 12 INCOME TAXES.

Appendix C, Uncertainty over Income Tax Treatments, to Ind AS 12, ‘Income Taxes’ The appendix explains how to recognize and measure deferred and current income tax assets and liabilities where there is uncertainty over a tax treatment. In particular, it discusses:

- How to determine the appropriate unit of account, and that each uncertain tax treatment should be considered separately or together as a group, depending on which approach better predicts the resolution of the uncertainty;

- That the entity should assume a tax authority will examine the uncertain tax treatments and have full knowledge of all related information, i.e. that detection risk should be ignored;

- That the entity should reflect the effect of the uncertainty in its income tax accounting when it is not probable that the tax authorities will accept the treatment;

That the impact of the uncertainty should be measured using either the most likely amount or the expected value method, depending on which method better predicts the resolution of the uncertainty; and that the judgments and estimates made must be reassessed whenever circumstances have changed or there is new information that affects the judgments.

- The application of this guidance is not expected to have an impact on the separate financial statements.

18. CURRENT VS NON-CURRET CLASSIFICATION:

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset as current when it is:

- Expected to be realized or intended to sold or consumed in normal operating cycle

- Held primarily for the purpose of trading

- Expected to be realized within twelve months after the reporting period,

Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current

A liability is current when:

- It is expected to be settled in normal operating cycle

- It is held primarily for the purpose of trading

- It is due to be settled within twelve months after the reporting period,

There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period The Company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets/noncurrent liabilities.

19. Ind AS 116 - Leases

The Company elects not to apply IND AS 116, as it has got short term leases (Recognition Exemption)

20. Functional and presentation currency:

These financial statements are presented in Indian Rupees (INR), which is the company’s functional currency. All financial information is presented in INR rounded to the nearest Lakhs except share and per share data, unless otherwise stated.

Exchange differences are recognized in the Statement of Profit and Loss.

21. Capital management

The Company’s objective for managing capitalist to ensure a sunder:

i) To ensure the company’s ability to continue as a going concern

ii) Maintaining a strong credit rating and debt equity ratio in order to support business and maximize the share holders’ value.

iii) Maintain an optimal capital structure.

iv) Compliance of financial covenant sunder the borrowing facilities.

For the purpose of capital management, capital includes issued equity capital, and all other equity reserves attributable to the equity holders of the Company

The Company manages its capital structure keeping in view of:

i) Compliance of financial covenant sunder the borrowing facilities.

ii) Changes in economic conditions

In order to achieve this over all objective of capital management, amongs together things,the Company aims to ensure that it meets financial covenants attached to the borrowing’s facilities defining capital structure requirements, where breach in meeting the financial covenants may permit the lender to call the borrowings.

There has been no breach in the financial covenants of any borrowing facility in the current period. There is no change in the objectives, policies or processes for managing capital over previous year. To maintain the capital structure,the Company may vary the dividend payment to shareholders. (Refer Note 41 Notes on Significant Accounting Policies)

22. Financial risk management

The Company’s principal financial liabilities comprise of loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables, and cash and cash equivalents that it derives directly from its operations. The Company is exposed to market risk, credit risk and liquidity risk. The Company’s senior management oversees the management of these risks under appropriate policies and procedures.

i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits.

a) Foreign exchange risk

The Company is subject to the risk that changes in foreign currency values impact the Company’s export revenues and imports of raw material and property, plant and equipment. The net un hedged exposure to the Company on holding financial assets (Trade Receivables and capital advances) and liabilities (trade payables and capital creditors) other than in their functional currency amounted to Rs.13.90 Crores.

The Company is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to US Dollar and Euro and Yen. The Company manages currency exposures within prescribed limits.

Foreign exchange transactions are covered with strict limits placed on the amount of uncovered exposure, if any, at any point in time. The aim of the Company’s approach to management of currency risk is to leave the company with no material residual risk.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate be cause of changes in market interest rates.

The Company is not exposed to any significant/material interest rate risk.

ii) Creditrisk

Credit risk is the risk that counterpart will not meet its obligations under a financial instrument or customer

Leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities including deposits with banks, financial institutions, foreign exchange transactions and other financial instruments.

Credit risk is managed by company’s established policy,procedures and control relating to customer credit risk management. Credit risk has always been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

iii) Liquidity risk

Liquidity risk is the risk that the Company, will face in meeting its obligations associated with its financial liabilities. The Company’s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions.

The Company maintained a cautious liquidity strategy, with a positive cash balance throughout the year ended 31-03-2024 and 31-03-2023.

Cash Flow from operating activities provides the funds to service the financial liabilities on a day to day basis.

The Company regularly monitors the rolling forecasts to ensure it has sufficient cash on an ongoing basis to meet its operational needs. Any short-term surplus cash generated, over and above the amount required for working capital management and other operational requirements is retained as cash and cash equivalent (to the extent required) and any excess is invested in interest bearing term deposits to optimize the cash return on investments while ensuring sufficient liquidity to meets is liabilities.

v) Fair value hierarchy

The Company uses the following hierarchy for determining and or disclosing the fair value of financial instruments by valuation techniques:

The following is the basis of categorizing the financial instruments measured at fair value in to Level 1 to Level 3.

> Level 1 - This level includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities.

> Level 2 - This level includes financial assets and liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. asprices) or indirectly (i.e. derived from prices).

> Level 3 - This level includes financial assets and liabilities, measured using inputs that are not based on observable market data(unobservable inputs). Fair values a redetermined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument no rare they based on available market data.

Fair value hierarchy of assets and liabilities measured at fair value on are cur ring basis as of March 31, 2024

The Company uses Level 2 for determining and or disclosing the fair value of financial instrument.

23. TAXES AND INCOME

a) Current Tax: Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

b) Taxable temporary differences will always lead to Deferred Tax Liability.

c) The timing deference on account of Depreciation charged on the Assets as per the Companies Act, 2013 and as per the Income Tax Act, 1961 has been provided. The net Deferred Tax Asset considered for the current year was Rs. 16.67 Lakhs. Previous Year we have we have recognised the net deferred tax assets of Rs. 54.21 Lakhs.

		Rs. In Lakhs
DEFERRED TAX LIABILITY (NET)	2023-24	2022-23
Opening Balance	302.97	357.18
Deferred Tax Asset/(Liability)	-16.09	-54.21
Deferred Tax Liability	288.88	302.97

24 Contingent Liabilities not provided for

Disputed amount of Rs.22.47 lakhs towards A.P Tax on entry of goods for the assessment year 2002-03 is pending which we have already paid an amount of Rs. 3.21 lakhs the case did not come for any hearing further.

Disputed amount of Rs.48.85 lakhs towards Entry Tax for the periods 2011-12 to 2016-17 is pending with The Telangana VAT Appellate Tribunal against which we have already paid an amount of Rs.24.42 lakhs the case did not come for any hearing further.

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Mar 31, 2018

1 CORPORATE INFORMATION:

Samkrg Pistons and Rings Ltd. (‘the Company’) or (‘SAM’) is engaged in the Manufacturing of Automobile Components. The Company has manufacturing plants at Bonthapally, Sangareddy Dist, T.S, and 2 units at Srikakulam Dist, A.P. The Company is Public Limited Company and is listed on BSE Limited. The functional currency of the Company is Indian Rupees. The financial Statements prepared under Company (Accounting Standards ) Rules, 2015 for the year ended 31st March 2018 were adopted by the Company on 4^th May, 2018

2 BASIS OF PREPARATION:

The financial statements have been prepared in accordance with Section 133 of the Companies Act 2013, Indian Accounting Standards (‘Ind AS’) notified under Companies (Indian Accounting Standards) Rules 2015, Upto the year ended 31st March 2017 the company prepared its financial statements in accordance with the previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006 as amended from time to time. This is the Company’s first Ind AS Financial Statements. The date of transition to Ind AS is 1st April 2016. Refer Note 28(18) for details of first time adoption of Ind AS and exemptions. The Ind AS financial statements are prepared on historical cost convention, except in case of certain financial instruments which are recognized at fair value at the end of the reporting period as rendered in the Accounting Policy No 4; and on an accrual basis as a going concern.

All Assets and Liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the Part I of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of Current Non-Current classification of Assets and Liabilities.

3. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

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 the principal amount outstanding. The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Company has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

4. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

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

5. FINANCIAL LIABILITIES

Financial liabilities are subsequently carried at amortized cost using the effective interest where the fair value differs from the Transaction Price. Where the fair value does not differ, materially, from Transaction Price, the financial liabilities are stated at transaction price only.

6. REVENUE RECOGNITION

The Company Revenue recognition is in line witth Ind AS 18

Revenue is reported net of discounts and indirect taxes. Revenue is reduced for estimated customer returns, rebate and other similar allowances.

Revenue in respect of export benefits is recognised when the certainty of realisation of the benefit is established.

7. Excise Duty Vs VAT

Revenue includes only the gross inflows of economic benefits received and receivable by the entity on its own account. Amounts collected on behalf of third parties such as sales taxes, goods and service taxes and value added taxes are not economic benefits which flow to the entity and do not result in increases in equity therefore the excluded from revenue recovery of Excise duty flows to the entity on its own account because its is a liability of the manufacturer which forms part of the cost of production, irrespective of whether the goods are sold or not since the recovery of excise duty flows to the entity on its own account, revenue includes excise duty VAT is not received by the entity on its own account,it is tax collected on value added to the commodity by the seller on behalf of the government;therefore it is excluded from revenue

8. Foreign Currencies

The Company’s Financial Statements are presented in INR,which is also the company’s Functional Currency. Transactions and Balances

Transactions in foreign currencies are initially recorded by the company at is functional currency spot rates at the date the transaction when it first qualifies for recognition Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in profit and loss.

9. Other income

Interest: Interest income is calculated on effective interest rate, but recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

Insurance Claim: Insurance Claims are recognised when the claims are assessed to be receivable.

10. PROVISIONS AND CONTINGENT LIABILITIES

Provisions: Provisions are recognised when there is a present obligation 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 there is a reliable estimate of the amount of the obligation. Current Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date and are not discounted to its present value.

Contingent Liabilities: Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

11. Product Warranty Expenses: Product Warranty expenses are accounted based on the claims received and accepted during the year and estimates in accordance with the warranty policy of the Company.

12. Earnings per share

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

13 Cash and Cash equivalents

In the Cash Flow Statement, Cash and Cash equivalents include cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.

14 Contributed Equity

Equity shares are classified as equity. Other Equity classiffied as per Ind AS

15. Dividend

Final dividends on shares are recorded as a liability on the date of approval by the shareholders. This has been consistently followed from Finanacial Year 2015-16

16. Employees Benefits

a) The company’s contribution to Provident Fund is administered through Regional Provident Fund Commissioner and being charged to revenue as incurred.

b) Leave encashment is accounted for on cash basis of the actual payments made.

17. Taxes and Income

a) Current tax: Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

b) Taxable temporary differences will always lead to Deferred Tax Liability

c) The timing deference on account of depreciation charged on the assets as per the Companies Act and as per the Income Tax Act has been provided. The net Deferred Tax Liability over the Deferred Tax Assets was Rs.46.59 lakhs and considered for the current year was Rs 46.59 lakhs.(previous year Rs. 40.00 lakhs)

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Mar 31, 2016

(a) Basis of accounting and preparation of financial statements

The financial statements has been prepared under the historical cost convention on an accrual basis, to comply with the generally accepted accounting principles in India (‘’’Indian GAAP”), the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 (as amended), the relevant provisions of the Companies Act, 1956, the relevant provisions of the Companies Act, 2013 to the extent applicable and the guidelines issued by the Securities and Exchange Board of India (“SEBI”). The financial statements are presented in Indian rupees rounded off to the nearest thousand.

(b) Use of estimates

The preparation of the financial statements in conformity with the Indian GAAP requires the Management to make estimates and assumption that affect the reported accounts of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and the reported period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could differ from these estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made.

(c) Current and non-current classification

All assets and liabilities are classified into current and non-current.

Assets

An asset is classified as current when it satisfies any of the following criteria:

i. It is expected to be realized in, or is intended for sale or consumption in, the company’s normal operating cycle.

ii. It is held primarily for the purpose of being traded.

iii. It is expected to be realized within 12 months after the reporting date; or

iv. It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as noncurrent.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

i. It is expected to be settled in the company’s normal operating cycle:

ii. It is held primarily for the purpose of being traded;

iii. It is due to be settled within 12 months after the reporting date; or

iv. The company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in it settlement by the issue of equity instruments do not affect its classification.

Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current.

Operating cycle

Operating cycle is the time between the acquisition of assets for processing and their realization in cash or cash equivalents. The company’s operating cycle is within a period of 12 months.

(d) Inventories

Traded goods are valued at lower of weighted average cost and net realizable value. Goods in transit as valued at cost or below.

(e) Cash flow Statement

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

Cash and cash equivalents for the purpose of cash flow comprise cash at bank and in hand and short term investments with an original maturity of three months or less.

(f) Revenue Recognition

Sales are recognized on dispatch of goods and upon transfer of property in the goods to customers. Sales are inclusive of excise duty, as applicable.

Income from shared services (services provided to Group companies) is recognized by the Company on accrual basis. Income in excess of billings is disclosed under Other current assets as unbilled revenues.

(g) Other income

Interest income is recognized using the time proportion method, based on the transactional interest rates. Dividend income is recognized when the Company’s right to receive dividend is established.

(h) Fixed Assets, Depreciation, Impairment

Fixed Assets are stated at cost/professional valuation less accumulated depreciation. Cost includes freight, installation cost, duties and taxes, interest on specific borrowings utilized for financing the qualifying fixed assets and other incidental expenses.

Depreciation is provided on straight - line method at the rates specified in the Schedule XIV to the Companies Act, 1956 or based on the estimated economic useful lives whichever is higher.

(i) Foreign Currency Transactions

Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transactions. Monetary assets and liabilities denominated in foreign currency are restated at the prevailing year end rates. The resultant gain/loss on account of foreign currency transactions are accounted in the statement of profit and loss. In respect of items covered by forward exchange contracts, the premium or discount arising at the inception of such a forward exchange contract is amortized as expense or income over the life of the contract. Any profit or loss arising on cancellation or renewal of such a forward contract is recognized in the statement of profit and loss.

5. OTHER INFORMATION:

1. RETIREMENT BENEFITS

A) The Company''s contribution to Provident Fund is administered through Regional Provident Fund Commissioner and being charged to revenue as incurred.

B) Leave encashment is accounted for on cash basis of the actual payments made.

2. TAXES AND INCOME

A) Current Tax: provision for income tax is determined in accordance with the provisions of income tax act 1961.

B) Incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent period(s). Provision had been made on the account of above as there exist deferment assets.

C) The timing deference on account of depreciation charged on the assets as per the Companies act and as per the Income Tax Act has been provided. The net deferred tax liability over the deferred tax assets was Rs.40 Lakhs and considered for the current year was Rs.40 Lakhs (Previous year Rs.37.86 Lakhs).

Contingent Liabilities Not Provided For

Disputed Amount of Rs.25.68 Lakhs towards A.P. Tax on Entry of Goods for the Assessment Year 2002-03 is pending with the ADC (CT) Punjagutta Division, Hyderabad against which we have already paid An amount of Rs.3.21 Lakhs the case did not come for any hearing further.

3. DETAILS UNDER MASA Sundry Creditors

Disclosure under the micro and small enterprises development Act, 2006. Amount due to micro and small enterprises are disclosed on the basis of information company regarding available with the status of the supplier is as follows:

8. Segment reporting under Accounting Standard - 17

The Company operates in signal primary business segment namely manufacture of auto components - piston assemblies, hence no separate disclosure is required.

9. Related party disclosures

The disclosure pertaining to the related party transactions as required by the accounting standard (AS-18) issued by the institute of Chartered Accountants of India, as applicable are indicated below:

15. The obligation under EPCG concessional duty scheme on account capital equipments imports amounting to Rs.837.88 Lakhs (previous year Rs.527.82 Lakhs).

16. The Company had not accepted any deposits from public nor solicited any as per Companies Act Deposit Rules 2013.

The Company had taken security deposits from our dealers of our products and paying interest at @9%. The deposits are repayable at the closure of the dealership only.

17. The company declared an interim dividend of Rs.4 per share on face value of Rs.10 per share and the total amount works out to Rs.392.80 Lakhs. And the dividend tax there on was Rs.78.92 Lakhs.

18. Figures for the previous year has been regrouped/reclassified wherever necessary to be conformity with the current year format of revised schedule VI.

19. The figures are rounded off to the nearest rupee.

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Mar 31, 2015

(a) Basis of accounting and preparation of financial statements

The financial statements has been prepared under the historical cost convention on an accrual basis, to comply with the generally accepted accounting principles in India ('"Indian GAAP"), the Accounting Stand- ards prescribed in the Companies (Accounting Standards) Rules, 2006 (as amended), the relevant provisions of the Companies Act, 1956, the relevant provisions of the Companies Act, 2013 to the extent applicable and the guidelines issued by the Securities and Exchange Board of India ("SEBI"). The financial statements are presented in Indian rupees rounded off to the nearest thousand.

(b) Use of estimates

The preparation of the financial statements in conformity with the Indian GAAP requires the Management to make estimates and assumption that affect the reported accounts of assets and liabilities, disclosure of con- tingent liabilities as at the date of the financial statements and the reported period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could differ from these estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made.

(c) Current and non-current classification

All assets and liabilities are classified into current and non-current.

Assets

An asset is classified as current when it satisfies any of the following criteria:

i. It is expected to be realised in, or is intended for sale or consumption in, the company's normal operating cycle.

ii. It is held primarily for the purpose of being traded.

iii. It is expected to be realised within 12 months after the reporting date; or

iv. It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as non- current.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

i. It is expected to be settled in the company's normal operating cycle:

ii. It is held primarily for the purpose of being traded;

iii. It is due to be settled within 12 months after the reporting date; or

iv. The company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in it set- tlement by the issue of equity instruments do not affect its classification.

Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current.

Operating cycle

Operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. The company's operating cycle is within a period of 12 months.

(d) Inventories

Traded goods are valued at lower of weighted average cost and net realisable value. Goods in transit as valued at cost or below.

(e) Cash flow Statement

Cash flows are reported using the indirect method, whereby net profit/loss before tax is adjusted for the effects of transactions of a non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the com- pany are segregated.

Cash and cash equivalents for the purpose of cash flow comprise cash at bank and in hand and short term investments with an original maturity of three months or less.

(f) Revenue Recognition

Sales are recognised on dispatch of goods and upon transfer of property in the goods to customers. Sales are inclusive of excise duty, as applicable.

Income from shared services (services provided to Group companies) is recognised by the Company on ac- crual basis. Income in excess of billings is disclosed under Other current assets as unbilled revenues.

(g) Other income

Interest income is recognised using the time proportion method, based on the transactional interest rates. Dividend income is recognised when the Company's right to receive dividend is established.

(h) Fixed Assets, Depreciation, Impairment

Fixed Assets are stated at cost/professional valuation less accumulated depreciation. Cost includes freight, installation cost, duties and taxes, interest on specific borrowings utilised for financing the qualifying fixed assets and other incidental expenses.

Depreciation is provided on straight - line method at the rates specified in the Schedule XIV to the Compa- nies Act, 1956 or based on the estimated economic useful lives whichever is higher.

(i) Foreign Currency Transactions

Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transac- tions. Monetary assets and liabilities denominated in foreign currency are restated at the prevailing year end rates. The resultant gain/loss on account of foreign currency transactions are accounted in the state- ment of profit and loss. In respect of items covered by forward exchange contracts, the premium or discount arising at the inception of such a forward exchange contract is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation or renewal of such a forward contract is recognised in the statement of profit and loss.

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Mar 31, 2014

1. Method of Accounting

The financial statements have been prepared on accrual basis and at historical cost in Accordance with generally accepted accounting principles in India and provisions of the Companies act 1956 read with the Companies (Accounting Standards) Rules 2006.

The accounts were regrouped according to the requirements of the Revised Schedule VI

2. Revenue Recognition

Sales comprises sale of goods and services net of trade discount and inclusive of Excise duty and sales Tax.

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Mar 31, 2013

1. Method of Accounting

The financial statements have been prepared on accrual basis and at historical cost in Accordance with generally accepted accounting principles in India and provisions of the Companies act 1956 read with the Companies (Accounting Standards) Rules 2006.

The accounts were regrouped according to the requirements of the revised schedule VI

2. Revenue Recognition

Sales comprises sale of goods and services net of trade discount and inclusive of Excise duty and exclude sales Tax.

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Mar 31, 2012

1. Method of Accounting

The financial statements have been prepared on accrual basis and at historical cost in accordance with generally accepted accounting principles in India and provisions of the Companies Act 1956 read with the Companies (Accounting Standards) Rules 2006.

The accounts were regrouped according to the requirements of the revised schedule VI

2. Revenue Recognition

Sales comprises sale of goods and services net of trade discount and inclusive of Excise duty.

Term Loan from SBI Secured By First Charge on All Fixed Assets (Present and Future Both Moveable and Immovable.) of The Company Collateral-second Charge on All Current Assets of the Company

The Term Loans-1 Is Repayable In 12 Quarterly Instalments and out of which 6 are paid .

The Repayment Commenced from December 2010

The Second Term Loan of Rs 500 Lacs taken on 09.11.2011 and the Repayable in 10 Quartrely Instalments Commenced from December 2011

The Instalments that were falls Due In the Next 12 Months has been shown under Current Labilities an amount of Rs 366.64 Lacs was shown under Current Liabilities

The Loan for Vehicles from ICICI Bank and the Vehicle is Hypothecated to ICICI Bank the Instalment for the next 12 Months amounting 4.5 Lacs were Considered under Current Liabilities.

The other Loans are from Directors and their relatives. The Interest were paid at 15%.

No Part of the Loan Is Repayable Till The Term Loan from the Banks are Cleared.

INTEREST FREE SALES TAX LOAN IS REPAYABLE AS FOLLOWS:

1. Plant-I - Second Deferment Repayable In 14 Years Commencing from April 2012.

2. Plant-II - First Deferment Repayable In 10 Years Commenced from 2004 and Second Deferment from April 2015.

3. Plant-III - Repayable In 14 Years Commenced from April 2011.

An Amount Of Rs 198.09 Lacs Represents Repayable In The Next 12 Months had been shown under Current Liabilities.

The work in progress represents only part of the regular product that were under production and NOT covered for any reservation of warranty claims

The finished goods were valued at cost which does not include excise duty component. The excise duty is neither considered for opening stock nor closing stock .

This method was followed consistantly by the company.

The Raw materails including traded goods, stores and spares were valued at cost to the unit.

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Mar 31, 2011

1. Method of Accounting

The financial statements have been prepared on accrual basis and at historical cost in Accordance with generally accepted accounting principles in India and provisions of the Companies act 1956 read with the Companies (Accounting Standards) Rules 2006.

2. Revenue Recognition

Sales comprises sale of goods and services net of trade discount and inclusive of Excise duty and sales Tax.

3. Fixed Assets

A. (a) Fixed assets are stated at cost less depreciation. The cost of Fixed Assets is net of Cenvat credit availed and to be claimed.

(b) Depreciation on Fixed Assets added or disposed during the year is provided on pro-rata basis with respective date of acquisition or disposal.

(c) The Fixed Assets includes self made machines.

B. Depreciation:

Being the company had claimed Depreciation on Straight line basis, the Assets on which 100% Depreciation claimed were reduced from the Gross Block of Asset and Gross Depreciation and the value is Rs.9.21 crores. Since the assets were fully depreciated beyond 95% of the gross value the excess 5% of gross value had been taken to Impairment assets and General Reserve. The depreciation will be claimed only upto 95% of the gross value and the balance 5% will be transferred to impaired assets. This Policy will be followed from the currant financial year. Due to above there is no impact on the profit of the company.

4. Inventories

i) Raw material, stores and spares and work-in-progress are valued at cost, net of Cenvat Credit. Finished goods are valued at the lower of cost or market value whichever is lower.

ii) Excise Duty on stocks lying with the company is not added to the cost of finished goods inventory. This is in line with the consistency in valuation of inventory by followed by the Management.

5. Excise Duty

Excise duty on goods manufactured is accounted only at the time of removal of goods from the factory.

6. Foreign Currency Transactions

a) Foreign Currency transactions are recognized in the books at the exchange rates prevailing on the date of the transaction.

b) In the case of Current Assets/Liabilities the difference (Gain or Loss) between the actual payment and the amount recognized in the books is accounted as Exchange Gain or Loss..

c) Other income includes the following items

i) Sale of DEPB Licenses Rs. 69.19 lacs.

ii) Exchange Fluctuation Loss Rs. 0.17 lacs.

7. Retirement Benefits

a) The Company's contribution to Provident Fund is administered through Regional Provident Fund Commissioner and being charged to revenue as incurred.

b) Gratuity in respect of past and present services of employees is being accounted for on accrual basis based on actuarial valuation done by the company. The payment of Gratuity to the employees who had

left the service had been adjusted against the provision made. The provision of gratuity has been computed as on the date of closure of accounts by reducing the provision made in the earlier years.

c) Leave encashment is accounted for on cash basis on the basis of the actual payments made.

8. Taxes on Income

a) Current Tax: Provision for Income Tax is determined in accordance with the provisions Of Income Tax Act. 1961.

b) Deferred Tax Provision: Deferred Tax is recognized on timing differences being the Differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent period(s). Provision had been made on the account of above as there exist deferment assets.

c) The timing deference on account of Depreciation charged on the Assets as per the Companies Act and as per the Income Tax Act has been provided. The net deferred tax liability over the Deferred Tax Assets was Rs. 25.03 lacs was considered for the current year as Rs.25.00 lacs.

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Mar 31, 2010

1. Method of Accounting

The financial statements have been prepared on accrual basis and at historical cost in a accordance with generally accepted accounting principles in India and provisions of the Companies Act 1956 read with the Companies (Accounting Standards) Rules 2006.

2. Revenue Recognition

Sales comprises sale of goods and services net of trade discount and inclusive of Excise duty and sales Tax.

3. Fixed Assets

A. (a) Fixed Assets are stated at cost less depreciation. The cost of Fixed Assets is net of Cenvat credit

availed and to be claimed,

(b) Depreciation on Fixed Assets added or disposed during the year is provided on pro-rata basis with respective date of acquisition or disposal.

(c) The Fixed Assets includes self made machines.

B. Depreciation:

Being the Company had claimed Depreciation on Straight line basis, the Assets on which 100% Depreciation claimed were reduced from the Gross Block of Asset and Gross Depreciation and the value is Rs.9.00 crores

4. Inventories

i) Raw material, stores and spares and work-in-progress are valued at cost, net of cenvat Credit. Finished goods are valued at the lower of cost or market value whichever is lower.

ii) Excise Duty on stocks lying with the company is not added to the cost of finished goods Inventory. This is in line with the consistency in valuation of inventory by followed by the Management.

5. Excise Duty

Excise duty on goods manufactured is accounted only at the time of removal of goods from the factory.

7. Retirement Benefits

a) The Companys contribution to Provident Fund is administered through Regional Provident Fund Commissioner and being charged to revenue as incurred.

b) Gratuity in respect of past and present services of employees is being accounted for on accrual basis based on actuarial valuation done by the company. The payment of Gratuity to the employees who had

left the service had been adjusted against the provision made. The provision of gratuity has been computed as on the date of closure of accounts by reducing the provision made in the earlier years.

c) Leave encashment is accounted for on cash basis on the basis of the actual payments made. 8. Taxes on Income

a) Current Tax: Provision for Income Tax is determined in accordance with the provisions Of Income Tax Act. 1961.

b) Deferred Tax Provision: Deferred Tax is recognized on timing differences being the Differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent period(s). Provision had been made on the account of above as there exist deferment assets.

c) The timing deference on account of Depreciation charged on the Assets as per the Companies Act and as per the Income Tax Act has been provided. The net deferred tax liability over the Deferred Tax Assets was Rs. 25.03 lacs was considered for the current year as Rs.25.00 lacs.