Provision and contingent liabilities

A provision is recognised when the Company has a
present obligation as result of a past event and it is
probable that the outflow of resources will be required
to settle the obligation, in respect of which a reliable
estimate can be made. These are reviewed at each
balance sheet date and adjusted to reflect the current
best estimates.

Contingent liabilities are disclosed when there is
a possible obligation arising from past events, the
existence of which will be confirmed only by the
occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the
Company or a present obligation that arises from past
events where it is either not probable that an outflow of
resources will be required to settle the obligation or a
reliable estimate of the amount cannot be made.

Contingent liabilities are not recognised in the financial
statements. Contingent assets are neither recognised
nor disclosed in the financial statements.

(l) Revenue recognition

The Company recognizes revenue when it satisfies
a performance obligation in accordance with the
provisions of contract with the customer. This is achieved
when control of the product has been transferred to
the customer, which is generally determined when
title, ownership, risk of obsolescence and loss pass to
the customer and the Company has the present right
to payment, all of which occurs at a point in time upon
shipment or delivery of the product. The Company
considers shipping and handling activities as costs to
fulfil the promise to transfer the related products and
the customer payments for shipping and handling costs
are recorded as a component of revenue.

Performance Obligation is achieved when:

i) the Company has transferred to the buyer the
significant risks and rewards of ownership of the
goods;

ii) the Company retains neither continuing managerial
involvement to the degree usually associated with
ownership nor effective control over the goods sold;

iii) the amount of revenue can be measured reliably;

iv) it is probable that the economic benefits associated
with the transaction will flow to the Company; and

v) the costs incurred or to be incurred in respect of
the transaction can be measured reliably.

- Sale of products

Revenue from sale of products is recognized when
the control on the goods have been transferred to the
customer. The performance obligation in case of sale
of product is satisfied at a point in time i.e., when the
material is shipped to the customer or on delivery to the
customer and there is no continuing effective control or
managerial involvement with the goods, and the amount
of revenue can be measured reliably.

Revenue from operations is disclosed net of GST.

Revenue from operations is adjusted with gain/ loss on
corresponding on foreign currency transactions related
to export.

- Government Grants

Export incentive entitlements are recognised as income
when there is reasonable assurance to receive that
company will comply with the conditions attached to
them and it is established that incentive will be received.

Government grants that compensate the Company for
expenses incurred are recognised in the statement of
profit and loss, as income or deduction from the relevant
expense, on a systematic basis in the periods in which
the expense is recognised.

- Other Income

Other income is accounted for on accrual basis as and
when the right to receive arises.

(m) Expenditure

Expenses are accounted on accrual basis.

(n) Employee benefits

The Company's retirement benefit obligation is subject
to a number of judgement including discount rates,
inflation and salary growth. Significant judgement is
required when setting these criteria and a change in
these assumptions would have a significant impact on
the amount recorded in the Company's balance sheet
and the statement of profit and loss. The Company sets
these judgements based on previous experience and
third party actuarial advice.

- Short-term employee benefits

Short-term employee benefits are expensed as the
related service is provided. A liability is recognised
for the amount expected to be paid if the Company
has a present legal or constructive obligation to pay
this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.

- Defined contribution plans

Contributions to defined contribution schemes such
as provident fund, employees state insurance, labour
welfare fund, are charged as an expense in Profit and
loss account, based on the amount of contribution
required to be made as and when services are rendered
by the employees. These are classified as Defined
Contribution Schemes as the Company has no further
defined obligations beyond the monthly contributions.

- Retirement benefit obligations

Retirement benefit obligations are classified into defined
benefits plans and defined contribution plans as under:

Defined Gratuity Plans

The Company pays gratuity to the employees whoever
has completed five years of service with the Company
at the time of resignation/superannuation. The gratuity
is paid @15 days salary for every completed year of
service as per the Payment of Gratuity Act 1972.

The plan provides for a lump sum payment to vested
employees at retirement, death while in employment
or on termination of employment of an amount based
on the respective employee's salary and the tenure
of employment. The liability in respect of Gratuity is
recognised in the books of accounts based on actuarial
valuation by an independent actuary.

Compensated absences

As per the Company's policy, eligible leaves can be
accumulated by the employees and carried forward to
future periods to either be utilized during the service, or
encashed. Encashment can be made during service, on
early retirement, on withdrawal of scheme, at resignation
and upon death of the employee. Accumulated
compensated absences are treated as other long-term
employee benefits. The Company's liability in respect
of other long-term employee benefits is recognised in
the books of account based on actuarial valuation using
projected unit credit method as at Balance Sheet date
by an independent actuary. Actuarial losses/gains are
recognised in the Statement of Profit and Loss in the
year in which they arise.

Actuarial valuation

The liability in respect of all defined benefit plans is
accrued in the books of account on the basis of actuarial
valuation carried out by an independent actuary using
the Projected Unit Credit Method, which recognises
each year of service as giving rise to additional unit of
employee benefit entitlement and measure each unit
separately to build up the final obligation. The obligation
is measured at the present value of estimated future

cash flows. The discount rates used for determining the
present value of obligation under defined benefit plans,
is based on the market yields on Government securities
as at the Balance Sheet date, having maturity periods
approximating to the terms of related obligations.

- Re-measurement

Benefit plans in respect of retirement benefits are
charged to the Other Comprehensive Income.

(o) Income Taxes

The tax expense for the period comprises current and
deferred tax. Tax is recognised in Statement of Profit
and Loss, except to the extent that it relates to items
recognised in the comprehensive income. In which
case, the tax is also recognised in other comprehensive
income or equity.

- Current tax

Current income tax assets and liabilities are measured
at the amount expected to be recovered from or paid to
the taxation authorities. The tax rates and tax laws used
to compute the amount are those that are enacted by
the end of the reporting period.

Current income tax relating to items recognised outside
profit or loss is recognised outside profit or loss (i.e. in
other comprehensive income). Current tax items are
recognised in correlation to the underlying transaction
either in OCI or directly in equity. Management
periodically evaluates positions taken in the tax returns
with respect to situations in which applicable tax
regulations are subject to interpretation and establishes
provisions where appropriate.

- Deferred tax

Deferred tax is recognised on temporary differences
between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax
bases used in the computation of taxable profit.

Deferred tax liabilities / assets are measured at the
tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based
on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.
The carrying amount of Deferred tax liabilities and assets
are reviewed at the end of each reporting period.

(p) Finance costs

Borrowing costs include exchange differences arising
from foreign currency borrowings to the extent they are
regarded as an adjustment to the interest cost. 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.

All other borrowing costs are charged to the Statement
of Profit and Loss for the period for which they are
incurred.

Interest free loan taken from promoters and others has
been derived on basis of fair value based on market rate
of interest prevailing when loan and derived to the total
tenure of loan. The interest for the period is charged to
the Statement of Profit and Loss.

(q) Foreign currencies transactions and translation

The Company's financial statements are presented in
INR, which is also the Company's functional currency.
Transactions in foreign currencies are initially recorded
by the Company at INR spot rate at the date the
transaction first qualifies for recognition. Monetary
assets and liabilities denominated in foreign currencies
are translated at the functional currency spot rates of
exchange at the reporting date. Exchange differences
arising on settlement or translation of monetary items
are recognized in profit or loss.

Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using
the exchange rates at the dates of the initial transactions.

(r) Earnings per share

Basic Earnings per share (EPS) amounts are calculated
by dividing the profit for the year attributable to equity
holders by the weighted average number of equity
shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the
profit attributable to equity holders adjusted for the
effects of potential equity shares by the weighted
average number of equity shares outstanding during
the year plus the weighted average number of equity
shares that would be issued on conversion of all the
dilutive potential equity shares into equity shares.

(s) Business Combination

The company accounts for its business combinations
in the nature of Merger, wherein all the assets and
liabilities of the transferor company will become, after
amalgamation, the assets and liabilities of the transferee
company.

The consideration for the amalgamation receivable by
those equity shareholders of the transferor company
who agree to become equity shareholders of the
transferee company is discharged by the transferee
company wholly by the issue of equity shares in the
transferee company.

The business of the transferor company is intended to
be carried on, after the amalgamation, by the transferee
company.

No adjustment is to be made to the book values of the
assets and liabilities of the transferor company when
they are incorporated in the financial statements of
the transferee company except to ensure uniformity of
accounting policies.

(t) Segment reporting

Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision maker. The board of directors
of the Company has been identified as being the chief
operating decision maker by the Management of the
company. The Business activity of the company majorly
falls within one business segment viz “Laminates".