A. The Company values its Raw Materials, Finished Goods and other items at cost.

B. Fixed Assets are recorded at historical value less Modvat credit thereon subject to- revaluation of Plant & Machinery and Building and Pre-operative expenses including; interest on borrowing are capitalised in addition to cost of fixed assets ,

C. The Company follows accrual method of accounting.

D. The Company depreciates its Fixed assets in accordance with provisions of schedule XIV to the Companies Act, 1956 as under.

a. In respect of its CR Strip Division for assets acquired after 31.3.98 on SLM method.

b. On other assets on SLM method

E. Preliminary & Public issue expenses are to-be amortised 1/10 of the, total expenses each year oil prorata basis.

F. Previous Years figures are regrouped / rearranged wherever considered necessary in view of making them more comparable.

G. Sales comprises sale of goods, export incentives entitlements, realised exchange fluctuation on export sale and trading of goods and excise duty.

H. Cost of Import purchases include customs duty, demurrage, clearing charges, net value of advance licenses and DEPB used for imports.

I. Company computes liability in respect of gratuity of the employeess on the basis,of their service period during the year. Accordingly the gratuity amount so computed is debited to Profit & Loss Account. Other retirement benefits are accounted on cash basis.. J. Borrowing costs that are attributable to the acquisition of qualifying assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as an expense in the period in which they are incurred.

K. Provision for Income Tax is made on the basis of results of the year. Although the actual liability will be computed and paid on the basis of the results for the financial year, in accordance with Accounting Standard AS 22 - "Accounting for taxes on income" issued by the Institute of Chartered Accountants of India, the deferred taxes for the time difference between book and tax profit for the year is accounted for using tax rates and laws that have been enacted or substantially enacted by the Balance Sheet Date. Deferred tax assets arising from temporary time difference are recognized to the extent there is reasonable certainty that the asset can be realized in future.

L. Additional information pursuant to Paras 3 & 4 Part-II of Schedule VI to the Companies Act, 1956 to the extent applicable and as certified by the Management, are annexed herewith in form of Annexure.