Accounting Policies of Krishca Strapping Solutions Ltd Company

Mar 31, 2025

II Significant Accounting Policies

1 Basis of preparation:

The Financial Statements have been prepared in accordance
with Indian Generally Accepted Accounting Principles (IGAAP)
under historical cost convention on the accrual basis. GAAP
comprises mandatory accounting standards prescribed by the
Companies (Accounting Standards) Rules, 2021.

2 Revenue recognition:

a) Sale of Goods

Revenue from sale of goods is recognized when the
Company has transferred to the buyer the property in

the goods for a price or all significant risks and rewards
of ownership have been transferred to the buyer and
the Company retains no effective control of the goods
transferred to a degree usually associated with ownership;
and no significant uncertainty exists regarding the
amount of the consideration that will be derived from
the sale of the goods.

b) Sale of services:

Revenue from service transactions is usually recognised
as the service is performed by the proportionate
completion method. The revenue recognised under this
method would be determined on the basis of contract
value, associated costs, number of acts or other suitable
basis. For practical purposes, when services are provided
by an indeterminate number of acts over a specific
period of time, revenue is recognised on a straight line
basis over the specific period.(The revenue is recognised
under this method would be when the sole or final act
takes place and the service becomes chargeable.) Such
performance should be regarded as being achieved when
no significant uncertainty exists regarding the amount of
the consideration that will be derived from rendering the
service.

c) Other Income

Revenue arising from the use by others of enterprise
resources yielding interest, royalties and dividends should
only be recognised when no significant uncertainty as to
measurability or collectability exists. These revenues are
recognised on the following bases:

(i) Interest: on a time proportion basis taking into
account the amount outstanding and the rate
applicable.

(ii) Royalties: on an accrual basis in accordance with
the terms of the relevant agreement.

(iii) Dividends from: when the owner''s right to receive
payment is established by investments in shares.

3 Property Plant and Equipment including Intangible assets:

Property Plant and Equipment''s are stated at cost, less
accumulated depreciation. Cost includes cost of acquisition
including material cost, freight, installation cost, duties and
taxes, and other incidental expenses, incurred up to the
installation stage, related to such acquisition. Property Plant
and Equipment''s purchased in India in foreign currency are
recorded in Rupees, converted at the exchange rate prevailed on
the date of purchase. Intangible assets that are acquired by the
Company are measured initially at cost. After initial recognition,
an intangible asset is carried at its cost less any accumulated
amortisation and any accumulated impairment loss.

4 Depreciation & Amortisation:

The Company has applied the estimated useful lives as
specified in Schedule II of the Companies Act 2013 and
calculated the depreciation as per the Written Down Value
(WDV) method. Depreciation on new assets acquired during
the year is provided at the rates applicable from the date of
acquisition to the end of the financial year.

Intangible assets are amortised on a straight-line basis over
the estimated useful life as specified in Schedule II of the
Companies Act 2013. The amortisation expense on intangible
assets with finite lives is recognised in the statement of
profit and loss. In respect of the assets sold during the year,
amortisation is provided from the beginning of the year till the
date of its disposal.

5 Impairment of assets:

The Management periodically assesses using, external and
internal sources, whether there is an indication that an asset
may be impaired. An impairment loss is recognised wherever
the carrying value of an asset exceeds its recoverable amount.
The recoverable amount is higher of the asset''s net selling
price and value in use, which means the present value of
future cash flows expected to arise from the continuing use
of the asset and its eventual disposal. Reversal of impairment

loss is recognised immediately as income in the profit and loss
account.

6 Inventories:

Inventories includes raw material, semi finished goods, stock-
in-trade, finished goods, stores & spares, consumables, packing
materials, goods for resale and commercial premises are valued
at lower of cost and net realizable value. Materials in transit is
valued at cost incurred till date.

Raw Material and Components - Cost include cost of purchases
and other costs incurred in bringing the inventories to their
present location and condition. Cost is determined using
weighted average valued at cost incurred till date.

Finished/Semi-Finished Goods - cost includes cost of direct
material, labour, other direct cost (Including variable costs) and
a proportion of fixed manufacturing overheads allocated based
on the normal operating capacity but excluding borrowing
costs. Cost is determined on weighted average cost basis.

Stock-in-trade - cost includes cost of purchase and other costs
incurred in bringing the inventories to their present location
and conditions

Stores, Spare Parts, Consumables, Packing Materials etc. - cost
is determined on FIFO basis.

Commercial Premises - Cost includes cost of land, premium for
development rights, construction cost, materials, services and
allocated interest and expenses incidental to the construction
business.

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

Adequate allowance is made for obsolete and slow-moving
items.

7 Use of estimates:

The preparation of the financial statements in conformity
with Generally Accepted Accounting Principles requires the
Management to make estimates and assumptions that affect
the reported balances of assets and liabilities and disclosures
relating to contingent assets and liabilities as at the date of
the financial statements and the reported amounts of income
and expenses during the year. Examples of such estimates
include provisions for doubtful debts, income taxes, post - sales
customer support and the useful lives of Property Plant and
Equipment''s and intangible assets.

8 Foreign currency transactions:

Domestic Operation:

I. Initial recognition :

A foreign currency transaction should be recorded, on
initial recognition in the reporting currency, by applying
to the foreign currency amount the exchange rate
between the reporting currency and the foreign currency
at the date of the transaction.

II. Measurement :

Foreign currency monetary items should be reported
using the closing rate.

Non-monetary items which are carried in terms of
historical cost denominated in a foreign currency should
be reported using the exchange rate at the date of the
transaction

Non-monetary items which are carried at fair value or
other similar valuation denominated in a foreign currency
should be reported using the exchange rates that existed
when the values were determined.

III. Treatment of Foreign exchange :

Exchange differences arising on settlement/restatement
of foreign currency monetary assets and liabilities of the
Company are recognised as income or expenses in the
Statement of Profit and Loss.

9 Employee Benefits:

A. Short - term employee benefits:

Leave encashment:

The leave encashment liability upon retirement would not
arise as the accumulated leave is reimbursed every year and
accounted at actual.

B. Post-Employment benefits:

Defined benefit plan:

Gratuity liability is a defined benefit obligation and is unfunded.
The Company accounts for liability for future gratuity benefits
based on the actuarial valuation using Projected Unit Credit
Method carried out as at the end of each financial year.

Defined contribution Plan:

Provident Fund: Eligible employees receive benefit from
provident fund covered under the Provident Fund Act. Both
the employee and the company make monthly contributions.
The employer contribution is charged off to Profit & Loss
Account as an expense.

10 Taxes on Income:

Income Tax expense is accounted for in accordance with AS-
22 "Accounting for Taxes on Income" for both Current Tax and

Deferred Tax stated below:

A. Current Tax:

Provision for current tax is made in accordance with the
provisions of the Income Tax Act, 1961.

B. Deferred Tax:

Deferred tax is recognised, subject to the consideration of
prudence, as the tax effect of timing difference between the
taxable income and accounting income computed for the
current accounting year using the tax rates and tax laws that
have been enacted or substantially enacted by the balance
sheet date.

Deferred tax assets are recognised and carried forward to the
extent that there is a reasonable certainty, except arising from
unabsorbed depreciation and carried forward losses, that
sufficient future taxable income will be available against which
such deferred tax assets can be realised.

11 Research & Development:

Expenditure of intangible asset on the research phase are
recognised as an expense when it is incurred and expenditure
on development phase are recognised if it is probable that
the future economic benefits that are attributable to the asset
will flow to the enterprise and the cost of the asset can be
measured reliably.

---

Mar 31, 2024

Note: 28 Company Overview & Significant Accounting Policies I Company Overview

Krishca Strapping Solutions Private Limited (the ""Company"") is a private limited company domiciled in India and was incorporated on December 12, 2017 vide Registration No.U74999TN2017PTC119939 under the provisions of the Companies Act, 2013. Krishca Strapping Solutions Private Limited was converted into Krishca Strapping Solutions Limited on December 29, 2022 vide Registration No.L74999TN2017PLC119939. The registered office of the Company is situated at Building 01B, LOGOS, Mappedu Logistics Park, Satharai Village, Thiruvallur Taluk, Thiruvallur, Tamilnadu-631203 India with operating units across the Country.

The Company has incorporated Two Wholly Owned Subsidiary, (Krishca Total Packaging Solutions , krishca total packaging & preservation solutions pte. Ltd) during the year and has not started the operations.

"The Company engaged in business of manufacturing steel straps, seals, and to provide total packaging solution. The Company has manufacturing facilities in India and primarily caters to the Indian Market with some export operations to countries in the Middle East.

II Significant Accounting Policies

1 Basis of preparation:

The Financial Statements have been prepared in accordance with Indian Generally Accepted Accounting Principles (IGAAP) under historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards prescribed by the Companies (Accounting Standards) Rules, 2021.

2 Revenue recognition:

a) Sale of Goods

Revenue from sale of goods is recognized when the Company has transferred to the buyer the property in the goods for a price or all significant risks and rewards of ownership have been transferred to the buyer and the Company retains no effective control of the goods transferred to a degree usually associated with ownership; and no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of the goods.

b) Sale of services:

Revenue from service transactions is usually recognised as the service is performed by the proportionate completion method .The revenue recognised under this method would be determined on the basis of contract value, associated costs, number of acts or other suitable basis. For practical purposes, when services are provided by an indeterminate number of acts over a specific period of time, revenue is recognised on a straight line basis over the specific period.(The revenue is recognised under this method when the sole or final act takes place and the service becomes chargeable.) Such performance should be regarded as being achieved when no significant uncertainty exists regarding the amount of the consideration that will be derived from rendering the service.

c) Other Income

Revenue arising from the use by others of enterprise resources yielding interest, royalties and dividends should only be recognised when no significant uncertainty as to measurability or collectability exists. These revenues are recognised on the following bases:

(i) Interest : on a time proportion basis taking into account the amount outstanding and the rate applicable.

(ii) Royalties : on an accrual basis in accordance with the terms of the relevant agreement.

(iii) Dividends : when the owner''s right to receive payment is established by investments in shares.

3 Property Plant and Equipment including Intangible assets:

Property Plant and Equipment''s are stated at cost, less accumulated depreciation. Cost includes cost of acquisition including material cost, freight, installation cost, duties and taxes, and other incidental expenses, incurred up to the installation stage, related to such acquisition. Property Plant and Equipment''s purchased in India in foreign currency are recorded in Rupees, converted at the exchange rate prevailed on the date of purchase. Intangible assets that are acquired by the Company are measured initially at cost. After initial recognition, an intangible asset is carried at its cost less any accumulated amortisation and any accumulated impairment loss.

4 Depreciation & Amortisation:

The Company has applied the estimated useful lives as specified in Schedule II of the Companies Act 2013 and calculated the depreciation as per the Written Down Value (WDV) method. Depreciation on new assets acquired during the year is provided at the rates applicable from the date of acquisition to the end of the financial year.

Intangible assets are amortised on a Writen Down Value over the estimated useful life as specified in Schedule II of the Companies Act 2013. Amortisation on new assets acquired during the year is provided at the rates applicable from the date of acquisition to the end of the financial year.

Useful life of Property, Plant and Equipment''s

Category	Useful life
Plant & Equipment	15
Computers & Accessories	3
Furniture & Fittings	10
Office Equipment''s	10
Vehicles	10
Intangible Assets	3

5 Impairment of assets:

The Management periodically assesses using, external and internal sources, whether there is an indication that an asset may be impaired. An impairment loss is recognised wherever the carrying value of an asset exceeds its recoverable amount. The recoverable amount is higher of the asset''s net selling price and value in use, which means the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. Reversal of impairment loss is recognised immediately as income in the profit and loss account.

6 Inventories:

Inventories includes raw material, semi finished goods, stock-in-trade, finished goods, stores & spares, consumables, packing materials, goods for resale and commercial premises are valued at lower of cost and net realizable value. Materials in transit is valued at cost incurred till date.

Raw Material and Components - Cost include cost of purchases and other costs incurred in bringing the inventories to their present location and condition. Cost is determined using weighted average valued at cost incurred till date.

Finished/Semi-Finished Goods - cost includes cost of direct material, labour, other direct cost (Including variable costs) and a proportion of fixed manufacturing overheads allocated based on the normal operating capacity but excluding borrowing costs. Cost is determined on weighted average cost basis.

Stock-in-trade - cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and conditions

Stores, Spare Parts, Consumables, Packing Materials etc. - cost is determined on weighted average cost basis.

Commercial Premises - Cost includes cost of land, premium for development rights, construction cost, materials, services and allocated interest and expenses incidental to the construction business.

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

Adequate allowance is made for obsolete and slow-moving items.

7 Use of estimates:

The preparation of the financial statements in conformity with Generally Accepted Accounting Principles requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as at the date of the financial statements and the reported amounts of income and expenses during the year. Examples of such estimates include provisions for doubtful debts, income taxes, post - sales customer support and the useful lives of Property Plant and Equipment''s and intangible assets.

8 Foreign currency transactions:

Domestic Operation:

I . Initial recognition :

A foreign currency transaction should be recorded, on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

II . Measurement :

Foreign currency monetary items should be reported using the closing rate.

Non-monetary items which are carried in terms of historical cost denominated in a foreign currency should be reported using the exchange rate at the date of the transaction

Non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency should be reported using the exchange rates that existed when the values were determined.

III . Treatment of Foreign exchange :

Exchange differences arising on settlement/restatement of foreign currency monetary assets and liabilities of the Company are recognised as income or expenses in the Statement of Profit and Loss.

9 Employee Benefits:

A. Short - term employee benefits:

Leave encashment:

The leave encashment liability upon retirement would not arise as the accumulated leave is reimbursed every year and accounted at actual.

B. Post-Employment benefits:

Defined benefit plan:

Gratuity liability is a defined benefit obligation and is unfunded. The Company accounts for liability for future gratuity benefits based on the actuarial valuation using Projected Unit Credit Method carried out as at the end of each financial year.

Defined contribution Plan:

Provident Fund: Eligible employees receive benefit from provident fund covered under the Provident Fund Act. Both the employee and the company make monthly contributions. The employer contribution is charged off to Profit & Loss Account as an expense.

10 Taxes on Income:

Income Tax expense is accounted for in accordance with AS-22 "Accounting for Taxes on Income" for both Current Tax and Deferred Tax stated below:

A. Current Tax:

Provision for current tax is made in accordance with the provisions of the Income Tax Act, 1961.

B. Deferred Tax:

Deferred tax is recognised, subject to the consideration of prudence, as the tax effect of timing difference between the taxable income and accounting income computed for the current accounting year using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.

Deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty, except arising from unabsorbed depreciation and carried forward losses, that sufficient future taxable income will be available against which such deferred tax assets can be realised.

11 Research & Development:

Expenditure of intangible asset on the research phase are recognised as an expense when it is incurred and expenditure on development phase are recognised if it is probable that the future economic benefits that are attributable to the asset will flow to the enterprise and the cost of the asset can be measured reliably.

12 Provisions and Contingent Liabilities:

A provision is recognised if, as a result of past event, the Company has a present legal obligation that can be estimated reliably and it is probable that an outflow of economic benefit will be required to settle the obligation. Provisions are determined by the best estimate of outflow of economic benefits required to settle the obligation at the reporting date. Where no reliable estimate can be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is possible obligation or present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

13 Earnings Per Share:

Basic Earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net profit after tax by the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. The diluted potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value which is the average market value of the outstanding shares. Dilutive potential equity shares are deemed converted as at the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

14 Cash and Cash Equivalents:

Cash and cash equivalents comprise cash on hand and Cheque in hand, balance with bank, demand deposits with banks and other short term highly liquid investments that are readily convertible to known amounts of cash & which are subject to an insignificant risk of changes in value where it has a short maturity of three months or less from the date of acquisition.

15 Cash Flow Statement:

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

The Company''s cash and cash equivalents consist of cash on hand and in banks and demand deposits with banks, which can be withdrawn at any time, without prior notice or penalty on the principal. For the purposes of the statement of cash flows, cash and cash equivalents include cash on hand, in banks and demand deposits with banks, net of outstanding bank overdrafts that are repayable on demand and are considered part of the Company''s cash management system.

16 Investments:

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

17 Government Grants

Government grants related to revenue

Government grants are recognised where there is reasonable assurance that the grant will be received, and all attached conditions will be complied with. Government grants related to revenue are recognised on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs which they are intended to compensate. Such grants should either be shown separately under ''other income'' or deducted in reporting the related expense.

18 Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are charged to the Statement of Profit and Loss for the period for which they are incurred.

19 Leases

As a Lessee I. Financial Lease

The Company recognise the finance lease as an asset and a liability. Such recognition will be at an amount equal to the fair value of the leased asset at the inception of the lease. However, from the standpoint of the Company, if the fair value of the leased asset exceeds the present value of the minimum lease payments,

the amount recorded as an asset and a liability will be the present value of the minimum lease payments. In calculating the present value of the minimum lease payments the discount rate is the interest rate implicit in the lease, if this is practicable to determine; if not, the Company''s incremental borrowing rate is used.

II. Operating Lease

Lease payments under an operating lease is recognised as an expense in the statement of profit and loss on a straight line basis over the lease term

---

Mar 31, 2023

Significant Accounting Policies

1 BASIS OF PREPARATION:

The Financial Statements have been prepared in
accordance with Indian Generally Accepted Accounting
Principles (IGAAP) under historical cost convention on
the accrual basis. GAAP comprises mandatory accounting
standards prescribed by the Companies (Accounting
Standards) Rules, 2021.

2 REVENUE RECOGNITION:

Revenue is recognized to the extent that it is probable
that, the economic benefits will flow to the Company and
the revenue can be reliably estimated and collectability
is reasonably assured. The company derives its revenues
primarily from Sale Revenue of goods is recognised when
control of the products being sold is transferred to our
customer and when there are no longer any unfulfilled
obligations. The Performance Obligations in our contracts
are fulfilled at the time of dispatch, delivery or upon formal
customer acceptance depending on customer terms.

Revenue is measured on the basis of sale price, after
deduction of any trade discounts, volume rebates and any
taxes or duties collected on behalf of the Government such
as goods and services tax, etc. Accumulated experience
is used to estimate the provision for such discounts and

rebates. Revenue is only recognised to the extent that it is
highly probable a significant reversal will not occur.

Unbilled revenue represents earnings on ongoing fixed
price and time and material contracts over and above the
amounts invoiced to customers.

(i) Interest : on a time proportion basis taking into account
the amount outstanding and the rate applicable.

(ii) Dividends : when the owner''s right to receive payment
is established by investments in shares.

(iii) Others : Other items of income and expenditure
are recognized on accrual basis and as a going concern
basis, and the accounting policies are consistent with the
generally accepted accounting policies.

3 PROPERTY PLANT AND EQUIPMENT INCLUDING
INTANGIBLE ASSETS:

Property Plant and Equipments are stated at cost,
less accumulated depreciation. Cost includes cost of
acquisition including material cost, freight, installation
cost, duties and taxes, and other incidental expenses,
incurred up to the installation stage, related to such
acquisition. Property Plant and Equipments purchased in
India in foreign currency are recorded in Rupees, converted
at the exchange rate prevailed on the date of purchase.
Intangible assets that are acquired by the Company are
measured initially at cost. After initial recognition, an
intangible asset is carried at its cost less any accumulated
amortisation and any accumulated impairment loss.

4 DEPRECIATION & AMORTISATION:

The Company has applied the estimated useful lives as
specified in Schedule II of the Companies Act 2013 and
calculated the depreciation as per the Writen Down Value
(WDV) method. Depreciation on new assets acquired
during the year is provided at the rates applicable from
the date of acquisition to the end of the financial year.

Intangible assets are amortised on a Writen Down Value
over the estimated useful life as specified in Schedule II
of the Companies Act 2013. Amortisation on new assets
acquired during the year is provided at the rates applicable
from the date of acquisition to the end of the financial year.

5 IMPAIRMENT OF ASSETS:

The Management periodically assesses using, external and
internal sources, whether there is an indication that an
asset may be impaired. An impairment loss is recognised

wherever the carrying value of an asset exceeds its
recoverable amount. The recoverable amount is higher
of the asset''s net selling price and value in use, which
means the present value of future cash flows expected to
arise from the continuing use of the asset and its eventual
disposal. Reversal of impairment loss is recognised
immediately as income in the profit and loss account.

6 INVENTORIES:

Inventories includes raw material, semi finished
goods, stock-in-trade, finished goods, stores & spares,
consumables, packing materials, goods for resale and
commercial premises are valued at lower of cost and
net realizable value. Materials in transit is valued at cost
incurred till date.

Raw Material and Components - Cost include cost
of purchases and other costs incurred in bringing the
inventories to their present location and condition.
Cost is determined using weighted average valued at cost
incurred till date.

Finished/Semi-Finished Goods - cost includes cost of
direct material, labor, other direct cost (Including variable
costs) and a proportion of fixed manufacturing overheads
allocated based on the normal operating capacity
but excluding borrowing costs. Cost is determined on
weighted average cost basis.

Stock-in-trade - cost includes cost of purchase and other
costs incurred in bringing the inventories to their present
location and conditions

Stores, Spare Parts, Consumables, Packing Materials
etc. - cost is determined on FIFO basis.

Goods for Resale - cost is determined on FIFO basis.

Commercial Premises - Cost includes cost of land,
premium for development rights, construction cost,
materials, services and allocated interest and expenses
incidental to the construction business.

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

Adequate allowance is made for obsolete and slow-moving
items.

7 USE OF ESTIMATES:

The preparation of the financial statements in conformity
with Generally Accepted Accounting Principles requires
the Management to make estimates and assumptions that
affect the reported balances of assets and liabilities and
disclosures relating to contingent assets and liabilities as
at the date of the financial statements and the reported
amounts of income and expenses during the year.
Examples of such estimates include provisions for doubtful
debts, income taxes, post - sales customer support and
the useful lives of Property Plant and Equipments and
intangible assets.

8 FOREIGN CURRENCY TRANSACTIONS:

Domestic Operation:

I . Initial recognition :

A foreign currency transaction should be recorded, on
initial recognition in the reporting currency, by applying to
the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date
of the transaction.

II . Measurement :

Foreign currency monetary items should be reported using
the closing rate.

Non-monetary items which are carried in terms of historical
cost denominated in a foreign currency should be reported
using the exchange rate at the date of the transaction

Non-monetary items which are carried at fair value or
other similar valuation denominated in a foreign currency
should be reported using the exchange rates that existed
when the values were determined.

III . Treatment of Foreign exchange :

Exchange differences arising on settlement/restatement
of foreign currency monetary assets and liabilities of the
Company are recognised as income or expenses in the
Statement of Profit and Loss.

9 EMPLOYEE BENEFITS:

A. Short - term employee benefits:

Leave encashment:

The leave encashment liability upon retirement would not
arise as the accumulated leave is reimbursed every year
and accounted at actual.

B. Post-Employment benefits:

Defined benefit plan:

Gratuity liability is a defined benefit obligation and is
unfunded. The Company accounts for liability for future
gratuity benefits based on the actuarial valuation using
Projected Unit Credit Method carried out as at the end of
each financial year.

Defined contribution Plan:

Provident Fund: Eligible employees receive benefit from
provident fund covered under the Provident Fund Act.
Both the employee and the company make monthly
contributions. The employer contribution is charged off
to Profit & Loss Account as an expense.

10 TAXES ON INCOME:

Income Tax expense is accounted for in accordance with
AS-22 Accounting for Taxes on Income for both Current Tax
and Deferred Tax stated below:

A. Current Tax:

Provision for current tax is made in accordance with the
provisions of the Income Tax Act, 1961.

B. Deferred Tax:

Deferred tax is recognised, subject to the consideration of
prudence, as the tax effect of timing difference between
the taxable income and accounting income computed for
the current accounting year using the tax rates and tax
laws that have been enacted or substantially enacted by
the balance sheet date.

Deferred tax assets are recognised and carried forward
to the extent that there is a reasonable certainty, except
arising from unabsorbed depreciation and carried
forward losses, that sufficient future taxable income will
be available against which such deferred tax assets can be
realised.

11 RESEARCH & DEVELOPMENT:

Expenditure of intangible asset on the research phase
are recognised as an expense when it is incurred and
expenditure on development phase are recognised if it
is probable that the future economic benefits that are
attributable to the asset will flow to the enterprise and the
cost of the asset can be measured reliably.