Accounting Policies of Oxides & Specialities Ltd. Company

Mar 31, 2014

(i) General:

Accounts are prepared under the historical cost basis in accordance with Generally Accepted Accounting Principles (GAAP), accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act 1956. All Income and expenditure having material bearing are recognized on accrual basis, except where otherwise stated.

Use of estimates

The presentation of financial statements is in conformity with generally accepted accounting principles and it requires management to make estimates and assumptions that affects the reported amounts of assets and liabilities, and the disclosure of contingent liabilities on the date of financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

(ii) Fixed Assets:

Fixed assets are capitalized at cost inclusive of freight, duties, taxes and all other incidental expenses related thereto. The diminution, if any, in the book value of these assets is provided for in the year of such determination of diminution.

(iii) Depreciation:

a) Premium on Leasehold land is being amortized from the commencement of commercial production over the remaining period of the lease.

b) In respect of other Fixed Assets, depreciation is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956.

c) Continuous Process Plant'' as defined in the said Schedule is considered on technical assessment and depreciation provided accordingly.

(iv) Investments:

Current investments are carried at lower of cost and quoted/fair value, computed category wise. Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

(v) Borrowing costs:

Borrowing costs attributable to the acquisition and reconstruction of qualifying assets are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other borrowing costs are charged to revenue.

(vi) Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost is assigned on FIFO basis. Obsolete, defective and unserviceable stocks are provided for. Cost of Finished goods and work in process include conversion and other costs incurred in bringing the inventories to their present location and condition.

(vii) Accounting for Taxes on Income:

Provision for Income Tax is made on the basis of the estimated taxable income for the current accounting period in accordance with the Income Tax Act, 1961.

Deferred tax resulting from timing difference between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing differences are expected to reverse. Deferred tax assets are recognized and carried forward only if there is a reasonable / virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

(viii) Foreign Exchange Transactions:

Transactions in Foreign Currency are recorded at the rate of exchange in force at the date of the transaction.

Current Assets and Current Liabilities in Foreign Currency outstanding at the year end, if any, are stated at the rate of exchange prevailing at the close of the year and resultant gain/loss is recognized in the Profit and Loss Account for the year.

(ix) Miscellaneous Expenditure:

Deferred Revenue Expense are being amortized / charged off over a period of ten years.

(x) Government Grants:

Grants are accounted for where it is reasonably certain that the ultimate collection will be made. Grants in the nature of Project Capital Subsidy are credited to Capital Reserve and transferred to Revenue Reserve on completion of the stipulated period under the scheme.

(xi) Retirement Benefits:

Liability in respect of gratuity is provided for on the basis of valuation, as worked out at the year end by the Company according to provisions of the Payment of Gratuity Act, 1972.

Liability in respected of Leave encashment is provided on the basis of valuation, as worked out according to company policy.

(xii) Provisions, Contingent Liabilities and Contingent Assets:

A Provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material are disclosed by way of notes to accounts. Contingent assets are not recognized or disclosed in the financial statements.

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Mar 31, 2013

(i) General:

The financial statements are prepared on the historical cost basis and on the accounting principles of a going concern.

All expenses and income to the extent considered payable and receivable, respectively, with reasonable certainty, unless specifically stated to be otherwise, are accounted for on mercantile basis.

Use of estimates

The presentation of financial statements is in conformity with generally accepted accounting principles and it requires management to make estimates and assumptions that affects the reported amounts of assets and liabilities, and the disclosure of contingent liabilities on the date of financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

(ii) Fixed Assets:

Fixed assets are capitalized at cost inclusive of freight, duties, taxes and all other incidental expenses related thereto. The diminution, if any, in the book value of these assets is provided for in the year of such determination of diminution.

(iii) Depreciation:

a) Premium on Leasehold land is being amortized from the commencement of commercial production over the remaining period of the lease.

b) In respect of other Fixed Assets, depreciation is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956.

c) Continuous Process Plant'' as defined in the said Schedule is considered on technical assessment and depreciation provided accordingly.

(iv) Investments:

Current investments are carried at lower of cost and quoted/fair value, computed category wise. Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

(v) Borrowing costs:

Borrowing costs attributable to the acquisition and reconstruction of qualifying assets are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other borrowing costs are charged to revenue.

(vi) Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost is assigned on FIFO basis. Obsolete, defective and unserviceable stocks are provided for. Cost of Finished goods and work in process include conversion and other costs incurred in bringing the inventories to their present location and condition.

(vii) Accounting for Taxes on Income:

Provision for Income Tax is made on the basis of the estimated taxable income for the current accounting period in accordance with the Income Tax Act, 1961.

Deferred tax resulting from timing difference between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing differences are expected to reverse. Deferred tax assets are recognized and carried forward only if there is a reasonable / virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

(viii) Foreign Exchange Transactions:

Transactions in Foreign Currency are recorded at the rate of exchange in force at the date of the transaction.

Current Assets and Current Liabilities in Foreign Currency outstanding at the year end, if any, are stated at the rate of exchange prevailing at the close of the year and resultant gain/loss is recognized in the Profit and Loss Account for the year.

(ix) Miscellaneous Expenditure:

Deferred Revenue Expense are being amortized / charged off over a period of ten years.

(x) Government Grants:

Grants are accounted for where it is reasonably certain that the ultimate collection will be made. Grants in the nature of Project Capital Subsidy are credited to Capital Reserve and transferred to Revenue Reserve on completion of the stipulated period under the scheme.

(xi) Retirement Benefits:

Liability in respect of gratuity is provided for on the basis of valuation, as worked out at the yearend by the Company according to provisions of the Payment of Gratuity Act, 1972.

Liability in respect of Leave encashment is provided on the basis of valuation, as worked out according to company policy.

(xii) Provisions, Contingent Liabilities and Contingent Assets :

A Provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material are disclosed by way of notes to accounts. Contingent assets are not recognized or disclosed in the financial statements.

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Mar 31, 2012

(i) General:

The financial statements are prepared on the historical cost basis and on the accounting principles of a going concern.

All expenses and income to the extent considered payable and receivable, respectively, with reasonable certainty, unless specifically stated to be otherwise, are accounted for on mercantile basis.

Use of estimates

The presentation of financial statements is in conformity with generally accepted accounting principles and it requires management to make estimates and assumptions that affects the reported amounts of assets and liabilities, and the disclosure of contingent liabilities on the date of financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

(ii) Fixed Assets:

Fixed assets are capitalized at cost inclusive of freight, duties, taxes and all other incidental expenses related thereto. The diminution, if any, in the book value of these assets is provided for in the year of such determination of diminution.

(iii) Depreciation:

a) Premium on Leasehold land is being amortized from the commencement of commercial production over the remaining period of the lease.

b) In respect of other Fixed Assets, depreciation is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956.

c) Continuous Process Plant'' as defined in the said Schedule is considered on technical assessment and depreciation provided accordingly.

(iv) Investments:

Current investments are carried at lower of cost and quoted/fair value, computed category wise. Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary.

(v) Borrowing costs:

Borrowing costs attributable to the acquisition and reconstruction of qualifying assets are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other borrowing costs are charged to revenue.

(vi) Inventories:

Inventories are valued at the lower of cost and net realizable value. Cost is assigned on FIFO basis. Obsolete, defective and unserviceable stocks are provided for. Cost of Finished goods and work in process include conversion and other costs incurred in bringing the inventories to their present location and condition.

(vii) Accounting for Taxes on Income:

Provision for Income Tax is made on the basis of the estimated taxable income for the current accounting period in accordance with the Income Tax Act, 1961.

Deferred tax resulting from timing difference between book and tax profits is accounted for under the liability method, at the current rate of tax, to the extent that the timing differences are expected to reverse. Deferred tax assets are recognized and carried forward only if there is a reasonable / virtual certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.

(viii)Foreign Exchange Transactions:

Transactions in Foreign Currency are recorded at the rate of exchange in force at the date of the transaction.

Current Assets and Current Liabilities in Foreign Currency outstanding at the year end, if any, are stated at the rate of exchange prevailing at the close of the year and resultant gain/loss is recognized in the Profit and Loss Account for the year.

(ix) Miscellaneous Expenditure :

Deferred Revenue Expense are being amortized / charged off over a period of ten years.

(x) Government Grants :

Grants are accounted for where it is reasonably certain that the ultimate collection will be made. Grants in the nature of Project Capital Subsidy are credited to Capital Reserve and transferred to Revenue Reserve on completion of the stipulated period under the scheme.

(xi) Retirement Benefits :

Liability in respect of gratuity is provided for on the basis of valuation, as worked out at the year end by the Company according to provisions of the Payment of Gratuity Act, 1972.

Liability in respected in Leave encashment is provided on the basis of valuation, as worked out according to company policy.

(xii) Provisions, Contingent Liabilities and Contingent Assets :

A Provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material are disclosed by way of notes to accounts. Contingent assets are not recognized or disclosed in the financial statements.

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Mar 31, 2010

(i) General :

The financial statements are prepared on the historical cost basis, except for revaluation of certain fixed assets (in earlier years), and on the accounting principles of a going concern.

All expenses and income to the extent considered payable and receivable, respectively, with reasonable certainty, unless specifically stated to be otherwise, are accounted for on merchantile basts (Refer note no. 6 here below).,

(ii) Fixed Assets :

Fixed assets are capitalized at cost inclusive of freight, duties, taxes and all other incidental expenses related thereto, except certain revalued assets which are stated at revalued amount, less accu- mulated depreciation. The diminution, if any, in the book value of these assets is provided for in the year of such determination of diminution:

(iii) Depreciation :

a) Premium on Leasehold land is being amortized from the commencement of commercial production over the remaining period of the lease.

b) In respect of other Fixed Assets, depreciation is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956.

c) Depreciation on the Revalued Fixed Assets is provided for in the Books of Account on straight line method other than

(a) above on the increased book value of the assets based on the balance life of the said assets as estimated by the external approved value.

d) The amount of depreciation so calculated, as stated in (a),

(b) and (c) above is charged to Profit and Loss Account. In the absence of any balance in Revaluation Reserve Account, the depreciation on the revalued amount is not recouped from the Revaluation Reserve.

e) Continuous Process Plant as defined in the said Schedule is considered on technical assessment and depreciation pro- vided accordingly.

(iv) Investments:

Long Term investments are stated at cost.

(v) Borrowing costs:

Borrowing costs attributable to the acquisition and reconstruction of qualifying assets are capitalized as part of the cost of respective assets up to the date when such asset is ready for its intended use. Other borrowing costs are charged to revenue.

(vi) inventories :

Inventories are valued at the lower of cost and net realizable value. Cost is assigned on FIFO basis. Obsolete, defective and unservice- able stocks are provided for. Cost of Finished goods and work in process include conversion and other costs incurred in bringing the inventories to their present location and condition.

(vii) Accounting for Taxes on Income :

Provision for Income Tax is made on the basis of the estimated taxable income for the current accounting period in accordance with the Income Tax Act, 1961.

Deferred tax resulting from timing difference between book and tax profits, is accounted for under the liability method, at the current rate of tax, to the extent that the timing differences are expected to reverse. Deferred tax assets are recognized and carried forward only if there is a reasonable / virtual certainty that they will be realized and are reviewed for the appropriateness of their respective car- rying values at each balance sheet date.

(viii) Foreign Exchange Transactions :

Transactions in Foreign Currency are recorded at the rate of exchange in force at the date of the transaction.

Current Assets and Current Liabilities in Foreign Currency outstand- ing at the year end, if any, are stated at the rate of exchange prevailing at the close of the year and resultant gain/loss is rec- ognized in the Profit and Loss Account for the year.

(ix) Miscellaneous Expenditure :

Deferred Revenue Expense are being amortized / charged off over a period of ten years.

(x) Government Grants :

Grants are accounted for where it is reasonably certain that the ultimate collection will be made. Grants in the nature of Project Capital Subsidy are credited to Capital Reserve and transferred to Revenue Reserve on completion of the stipulated period under the scheme.

(xi) Retirement Benefits :

Liability in respect of gratuity is provided for on the basis of valuation, as worked out at the year end by the Company according to provisions of the Payment of Gratuity Act, 1972.

Liability in respected in Leave encashment is provided on the basis of valuation, as worked out according to company policy.

(xii) Provisions. Contingent Liabilities and Contingent Assets :

A Provision is made based on a reliable estimate when it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation. Contingent Liabilities, if material are disclosed by way of notes to accounts. Contingent assets are not recognized or disclosed in the financial statements.