1.11 Provisions, Contingent Liability and Contingent Assets

Disputed liabilities and claims against the Company including claims raised by fiscal authorities (e.g.
Sales Tax, Income Tax, Excise etc.) pending in appeal or court for which no reliable estimate can be
made and or involves uncertainty of the outcome of the amount of the obligation or which are
remotely poised for crystallization are not provided for in accounts but disclosed in notes to accounts.

However, present obligation as a result of past event with possibility of outflow of resources, when
reliable estimation can be made of the amount of obligation, if any, is recognized in accounts in terms of
discounted value, if the time value of money is material using a current pre-tax rate that reflects the risk
specific to the liability. No contingent asset is recognized by the Company.

1.12 Foreign Currency Translation

The Company's financial statements are presented in INR, which is also the Company's functional
currency.

i. Transactions in foreign currencies, if any, are recognized at rate of overseas currency ruling on the
date of transactions. Gain/Loss arising on account of rise or fall in overseas currencies vis-a-vis
functional currency between the date and that of payment is charged to Statement of Profit and
Loss.

ii. Monetary Assets in foreign currencies, if any, are translated into functional currency at the
exchange rate ruling at the Reporting Date and the resultant gain or loss is accounted for in the
Statement of Profit and Loss.

iii. Non-Monetary items which are carried at historical cost denominated in a foreign currency, if
any, are reported using the exchange rate at the date of transaction.

iv. Impact of exchange fluctuation, if any, is separately disclosed in the notes to accounts.

1.13 Earnings Per Share

Basic Earnings per share is calculated by dividing:

- the net profit for the period attributable to equity shareholders

- by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share:

- the net profit for the period attributed to equity shareholders

- and the weighted average number of shares outstanding during the period

- is adjusted for the effects of all dilutive potential equity shares.

1.14 Borrowing Costs

Borrowing cost, if any, that are directly attributable to the acquisition, construction, or production of a
*qualifying asset are capitalized as a part of the cost of such asset till such time the asset is ready for its
intended use or sale.

Borrowing cost consists of interest and other costs that an entity incurs in connection with the
borrowing of funds. Borrowing costs also includes exchange differences, if any, to the extent regarded

as an adjustment to the borrowing costs. All other borrowing costs are recognized as expense in the
period in which they are incurred.

* A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its
intended use or sale.

1.15 Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on
hand, deposits held at call with financial institutions, other short- term, highly liquid investments with
original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.