SIGNIFICANT ACCOUNTING POLICIES System of Accounting Unless otherwise stated hereunder the financial accounts of the Company have been drawn up on historical cost convention and on accrual basis. Use of Estimates The brparation of financial statement requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are recognised in the period in which they are materialise. Sales Sales are net of taxes and sales returns but inclusive of excise duty and exchange rates fluctuations. Fixed Assets Fixed Assets are capitalised at cost of acquisition and subsequent improvements thereto including taxes, duties etc other than Cenvat credit wherever applicable. Freight & other incidental expenses related to acquisition and installation are added to cost. In case of write-up due to revaluation are shown at such higher amount. Debrciation Debrciation on all assets has been charged by written down value method in accordance with the useful life of the assets as brscribed in Schedule II to the Companies Act ,2013. In respect of revalued assets, the incremental debrciation attributable to the Revaluation is transferred to Revaluation Reserve. Inventories Inventories have been valued as follows - Raw Materials : At cost * Finished Goods : At lower of the cost and net realisable value ** Work in Progress : At cost * Stores, Tools & Other Materials : At cost * * The cost has been arrived at by using 'FIFO' method. ** The cost of finished goods has been determined by considering standard conversion cost. Impairment of Assets The Company determines whether there is any indication of impairment of the carrying amount of the company's assets. The recoverable amount of such assets are estimated, if any indication exists , and impairment losses recognised wherever the carrying amount of the assets exceeds its recoverable amount. Employees' Benefits -Company's contribution to Provident Fund and Family Pension Fund are charged to profit & loss account. -Provision for Gratuity and Leave Encashment benefits, in respect of employees governed by Indian rules and regualtions is made on the basis of actuarial valuation as at the end of the year in confirmity with the Acccoutning standard-15 (Revised) issued by the Institute of Chartered Accountants of India and the provision for leave encashment ( including long term leave ) in respect of employees at foreign branches is made as per law brvalent in foreign country. -Contribution to Employee Group Gratuity Trust for the current year are charged to Profit & Loss account and for the past years are adjusted in the Provision for Gratuity a/c. Foreign Currency Transactions Transactions in foreign currency are accounted for at the exchange rates brvailing at the date of transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currency are recognised in the profit and loss account. Exchange differences arising on account of monetary liabilities related to fixed assets are adjusted in the cost of assets. Bank Guarantee in foreign currency are translated at the exchange rate brvailing at the year end. Foreign Branch Operation's Translations The activities of the Foreign Branches are an integral part of the operations of the company and hence the foreign branch financial statements are translated in accordance with accounting standard applicable to Integral Foreign Operation as given under: Income & Expenditure items by applying to the foreign currency amount, the exchange rate at the date of transaction. The rate used is an average rate for calendar month and used for all transaction occurring during that calendar month. Fixed Assets are recorded at the exchange rate brvailing on the date of transaction. Debrciation on the fixed assets in Indian rupees, which are reported using the exchange rate at the date of transaction. Inventories related to stocks transfer from reporting enterprise are shown at the cost of reporting enterprises plus expenses incurred to bring the material at the shelf of foreign branch's warehouse and local bought out inventories are translated at the exchange rate brvailing at year end. Other current assets and liabilities are converted at the exchange rates brvailing at the year end. The exchange difference on translation of Foreign Branch financial statements are recognised in profit & loss account. Research & Development Revenue expenditure pertaining to research and development is charged to revenue in the year in which it is incurred. Capital Expenditure is treated as forming part of Fixed Assets. Government Grants i) Revenue grants are accounted for in Profit & Loss Account. ii) Capital grants other than relating to specific fixed assets are credited to Capital Reserve. Miscellaneous Expenditure Public Issue Expense, Deferred Revenue Expenses & other expenses on intangible assets are recognised & amortised as per the Accounting Standard no. 26 on Intangible Assets issued by the Institute of Chartered Accountants of India. Borrowing Cost Interest and other costs in connection with borrowing of funds to the extent related / attributed to the acquisition / construction of qualifying fixed assets are capitalised upto the date when such assets are ready for its intended use and other borrowing cost are charged to Profit and Loss Account. Provision for Deferred and Current tax Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred Tax resulting from "timing difference" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the assets will be realised in future. NOTES ON FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2015 1Revaluation of all the fixed assets (except Building under construction upto 31.03.1993) was carried out by an approved valuer as on 31st March, 1993, which resulted in an increase in the Gross Value of assets over original cost by T 2,50,17,478/-. The net increase in the value, resulting from the revaluation amounting to T 2,50,17,478/- has been credited to Revaluation Reserve, created during the year ended 31.03.1993. Of this Revaluation reserve, a sum of T 2,41,27,512/- has been adjusted on account of debrciation/sale of revalued assets till 31st March,2015. 2 Debrciation for the year, on write up of assets due to revaluation as on 31.03.1993, has been recouped out of Revaluation Reserve. 3 Term Deposits with Bank of India, Janpath Branch amounting to T 51,57,978.54 (Prev. year T 39,96,874.16) and Term Deposit with Indusind Bank ,Barakhamba Road Branch amounting T 15,21,138/- (Prve. Year T NiL) are pledged with Bank of India as Margin on Bank Guarantees, Letter of Credit and Foreign biils purchased by them. 4 Income /(Loss) on difference in exchange rates on account of foreign currency transactions relating to Export Sales amounting to Rs. (2,65,326/-) ( Previous Year - Rs. 2,57,291/-) has been grouped with Export Sale. 5 Excise duty payable on finished goods/Scrap Stock lying in stock at factory amounting to Rs. 8,21,637/- (Prev. year Rs. 6,31,154/-) has been included in the value of the closing stock after creating suitable provision for liability. 6 In the opinion of the Board, the Current Assets, Loans and Advances are stated at a value, considered realisable in the ordinary course of business. 7 The Company's operations brdominantly comprises of only one segment - Pumps & spares, therefore operationaly segment reporting does not apply. 8 Taxation provisions for current year and brvious year tax adjustments includes interest thereon. 9 The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amounts unpaid as at the year end together with interest paid/payable under this Act have not been given 10 Remittance in foreign currency towards Dividend for 2013-14 to Ms. Debra Pauly, U.K. of T 2,29,200/- on 76400 Equity Shares (Previous Year T 1,91,000/-) 11 Previous Year's figures have been re-grouped/re-arranged wherever necessary to render them comparable with the current year's figures. 12 Figures have been rounded off to the nearest rupee. As per our Report of even date. For A. Kay. Mehra & Co., Chartered Accountants (Registration No. 050004C) (A. KAY. MEHRA) Partner Membership No. 009963 For and on behalf of the Board (HARISH CHANDRA GUPTA) Chairman & Managing Director (DIN:00334405) (PRADEEP JAIN) (DGM-Finance & Accounts) (ANURAG GUPTA) Dy. Managing Director & CFO (DIN: 00334160) (ASHWANI K VERMA) Company Secretary (M.No.: A15482) Place : Noida Date : 30th May, 2015 |
