Accounting Policies of Wilwayfort India Ltd. Company

Mar 31, 2009

A) The accounts are prepared on historical - mercantile system of accounting and on the basis of going concern.

b) Fixed assets are valued at cost of acquisition less accumulated depreciation which has been provided for on Straight Line Method basis charged as per provisions of Section 205(2)(b) and Schedule XIV of the Companies Act, 1956.

c) Inventories are valued as per FIFO Method as under. Stores & Spares At Cost Packing Material At Cost Raw Material At Cost Work-in-Process At Cost

Finished Goods At lower of cost or market value.

d) Excise duty paid at the time of clearance of goods from the factory is debited to Profit & Loss Account. CENVAT credit availed on polyester film and other raw material purchase has been deducted from cost of material consumed. The CENVAT credit availed on capital goods is deducted from the cost of fixed assets and depreciation is provided on such reduced value.

e) Deferred Revenue Expenditure, Preliminary Expenditure/Share Issue Expenses are written off over a period of 10 Years starting from the financial year in which commercial production starts/allotment takes place in equal installments.

f) Pre-operative expenses relating to expansion/modernization are capitalized on commencement of commercial production.

g) Provision for liabilities of gratuity and leave encashment of employees is made on the basis of actuarial method calculated by the company on the Balance Sheet date.

h) Foreign Currency transactions

— Transactions involving foreign currencies are recorded at the rate of exchange prevailing at the time of transactions.

— Foreign currency liabilities incurred for the acquisition of fixed assets are translated at exchange rates prevailing on the last working day of the Accounting Period or forward cover rate, as applicable.

— The net variation arising out of the said translation and roll over charges, if any are adjusted to the cost of fixed assets. Depreciation on such variations is provided retrospectively from the date the asset is put to use.

— Other foreign currency assets and liabilities are similarly translated & gain/ loss arising out of such translation is adjusted to the Profit & Loss Account.

i) Export incentives are accounted for on receipt basis.

j) Taxation

Deferred tax asset and liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deterred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing difference are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets is reviewed to reassure realisation. The carrying amounts of the assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated. For assets that not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognised when ever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the profit and loss account. An impairment loss is reserved if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reserved only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortisation, if no impairment loss had been recognised. For the current year company has not created provision for current tax because amount of unabsorbed depreciation brought forward from previous years are sufficient to cover profit earn during the current year. 2. There are no employee (P.Y. Nil) who were in receipt of remuneration aggregating to Rs. 2400000 (P.Y. Rs. 2400000) or more in a year or Rs. 200000 (P.Y. 200000) or more per month, where employed for a part of the year.