| 1.1) Basis of Accounting
* The financial statements have been prepared under the historical cost
convention, in accordance with the generally accepted accounting
principal in India, Accounting Standard notified under sub-section (3C)
of section 211 of the Companies Act, 1956 and the other relevant
provisions of the Companies Act, 1956.
* Accounting policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles.
1.2) Revenue Recognition
* Dividend income on Investments is accounted for when the right to
receive the payment is established.
* Other Income is accounted on accrual basis as and when the right to
receive arises.
1. 3) Inventories
Inventories are valued at lower of cost or net realizable value.
1.4) Fixed Assets
Fixed Assets are stated at cost of acquisition inclusive of all
incidental expenses related thereto.
1.5) Depreciation
Depreciation on fixed assets has been provided on straight line method
at the rates prescribed under schedule xiv to the Companies Act 1956 as
Amended up to date from the month they were first put to use on
proportionate basis.
1.6) Impairment of Assets
Where there is an indication that an asset is impaired the recoverable
amount, if any, is estimated and the impairment loss is recognized to
the extent carrying amount exceeds recoverable amount.
1.7) Provision and Contingencies
The company creates a provision when there is a present obligation as a
result of past event that probably requires an outflow of resources and
reliable estimate can be made of the amount of the obligation. A
disclosure for a contingent liability is made when there is a possible
obligation or present obligation that probably will not require an
outflow of resources where reliable estimate of the amount of the
obligation cannot be made.
1.8) Investment
* Investments are stated at Cost.
* Long term Investment includes investment in shares and mutual funds
not intended for trading business
1.9) Foreign Currency Transaction
* Transactions in foreign currency are recorded at the exchange rate
prevailing on the date of the transaction. Foreign currency denominated
monetary assets and liabilities at the balance sheet date are
translated at the exchange rate prevailing on the date of balance
sheet.
* Exchange rate difference resulting from foreign exchange transactions
settled during the period including year-end transaction of assets and
liabilities are recognized under relevant heads in the profit and loss
account.
1.10) Income Tax
* Provision for current income tax is made on the basis of relevant
provisions of the Income Tax Act, 1961 as applicable to the financial
year.
* Deferred Tax is recognized subject to the consideration of prudence
on timing differences; being the difference between taxable incomes and
accounting income that originate in one period and are capable of
reversal in one or more subsequent period. Deferred tax assets relating
to un-absorbed depreciation and business loss are recognized only to
the extent that there is a virtual certainty that sufficient future
taxable income will be available against which such deferred tax asset
can be realized.
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