Annual Report 2011 - 12 - Nagarjuna Fertilizers

Notes to Financial Statements for the year ended March 31, 2012b) Work in process - at cost.Cost - includes material cost, labour, factory overheads and depreciation.Net realisable value in the case of Urea –• the Group Concession Price notified by the Govt. of India in respect of finished goods lying at the factory, and• the net sale price in respect of finished goods lying in the warehouses outside the factory.2.11.2. Traded products - at lower of cost and net realisable value.2.11.3. Other finished goods, work-in-process, raw materials, stores, spares, packing material and loose tools - at weighted average cost, less provision fordepletion in value, if any.2.12. Employee Benefits:Liability for employee benefits, both short and long term, for present and past services which are due as per the terms of employment are recorded in accordancewith Accounting Standard (AS) 15 “ Employee Benefits” notified by the Companies (Accounting Standard) Rules, 20062.12.1. Gratuity: In accordance with the Payment of Gratuity Act, 1972 the company provides for gratuity covering eligible Employees. Liability on accountof gratuity is covered by a policy with LIC and the annual contributions are paid / provided in accordance with the scheme.2.12.2. Superannuation: The Company makes monthly contribution to an approved superannuation fund covered by a policy with LIC of India. The Companyhas no further obligation beyond the monthly contribution.2.12.3. Compensated Absences: Liability for compensated absence is treated as a long term liability and is provided on the basis of valuation by an independentactuary as at the year end.2.12.4. Provident Fund: The Company’s Contribution towards provident fund, administered and managed by an approved trust, is charged to revenue.2.13. Research and Development:Expenditure relating to capital items is treated as fixed assets and depreciated at applicable rates. Revenue expenditure is charged to Statement of Profit andLoss in the year in which they are incurred.2.14. Taxes:2.14.1. Current tax: Provision for current tax is made based on the taxable income computed for the year under the Income Tax Act 1961.2.14.2. Deferred Taxes: Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and reverse in subsequentperiods. Deferred tax assets are recognised and carried forward only to the extent that there is a certainty that sufficient future taxable income will beavailable against which such Deferred Tax Assets can be realized.2.15. Contingencies:The Company recognises provisions when there is present obligation as a result of past event and it is probable that there will be an outflow of resources andreliable estimate can be made of the amount of the obligation. A disclosure for Contingent liabilities is made when there is a possible obligation or presentobligations that may, but probably will not, require an outflow of resources. Contingent assets are neither recognised and nor disclosed in the financialstatements.3. SHARE CAPITAL:Authorised 1March 31, 2012 March 31, 2011No. of shares ` in Lakhs No. of shares ` in LakhsEquity Shares of `1/-each (previous year ` 10/- each) 6,210,000,000 62,100.00 1,000,000 100.00Preference Shares of ` 90/- each 20,000,000 18,000.00 – –Issued, Subscribed and Paid Up 1Equity Shares of `1/-each (previous year ` 10/- each) 598,065,003 5,980.65 50,000 5.001refer note no 13.1. Reconciliation of the Number of shares outstanding at the beginning and at the end of the reporting period.March 31, 2012 March 31, 2011No. of shares ` in Lakhs No. of shares ` in LakhsEquity Shares of ` 1/- eachOutstanding at the beginning of the period - (Face Value of ` 10/- each) 50,000 5.00 50,000 5.00Since Sub divided during the year -(Face Value of ` 1/- each) 1 500,000 – – –Add: Issued during the year - (Face Value of ` 1/- each) 1 598,065,003 5,980.65 – –598,565,003 5,985.65 50,000 5.00Less: Cancelled during the year - (Face Value of ` 1/- each) 500,000 5.00 – –Outstanding at the end of the period - (Face Value of ` 1/- each) 598,065,003 5,980.65 50,000 5.001Refer Note no 1Annual Report 2011-12 | 45