NOTES FORMING PART OF THE FINANCIAL STATEMENT FOR THE YEAR ENDED 31st MARCH 2018.
38 SEGMENT :
i) Primary Segment :
The company is in the business of manufacturing Automotive Components parts & all its products fall in the same segment as nature of the products, production process, methods used for distribution, the regulatory environment and the resulting risks & rewards associated business lines are not materially different hence, it operates in only one primary segment (Business). Secondary segmental reporting is based on the geographical location of customer. The following is the distribution of the company’s sale by geographical markets and segment assets which can be attributed to customers in such markets.
41 RELATED PARTIES DISCLOSURE:
(a) Related parties, as per Ind AS 24- Related Party Disclosures, during the year as deemed in the Accounting Standard are given below the related parties with whom the company had transactions and related parties where control exist.
S.No. Related Parties Nature of Relationship KEY MANAGEMENT PERSONNEL
i) Mr. Krishna Kejriwal Chairman & Managing Director
ii) Mrs. Chand Kejriwal Whole Time Director
(iii) Mr. Rahul Kejriwal Whole Time Director
(iv) Mr. Anil Kumar Agrawal Director Finance and CFO
(v) Mr. Rohit Darji Company Secretary RELATIVE OF KEY MANAGEMENT PERSONNEL
(i) Mr. Basant Kejriwal Brother of Chairman, Managing Director and CEO
ENTITIES WHERE KEY MANAGEMENT PERSONAL/RELATIVES OF DIRECTORS HAS SIGNIFICANT INFLUENCE
(I) Remsons Cables Industries Private Ltd. Mr. Rahul Kejriwal is Director
(ii) Goodluck Electronics Private Ltd. Mr. Rahul Kejriwal is Director
45 Lease
The Company's leasing arrangements are in respect of office premises / warehouse. These leasing arrangements, which is mostly cancelable, range between 11 months to 3 years and are usually renewable by mutual consent at mutually agreed terms & conditions. The aggregate lease rentals of Rs. 64.66 Lacs (Previous Year Rs. 59.80 lacs) are charged as rent and shown under the note no. 36 " Other Expenses".
46 Balances of Trade Receivables, Trade Payables and Loans and Advances are subject to confirmation and consequential adjustment, if any.
47 In the opinion of the Board, Current Assets, Loans and Advances have value in the ordinary course of business at least equal to the amount at which they are stated.
48 Capital Management
i) Risk Management
For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company capital management is to maximize the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio and is measured by debt divided by total Equity. The Company’s Debt is defined as long-term and short-term borrowings including current maturities of long term borrowings and total equity (as shown in balance sheet) includes issued capital and all other reserves.
ii) Gearing Ratio
The gearing ratio at end of the reporting period was as follows.
The fair values of current debtors, cash & bank balances, loan to related party, security deposit to government department, current creditors and current borrowings and other financial liability are assumed to approximate their carrying amounts due to the short-term maturities of these assets and liabilities.
The Board provides guiding principles for overall risk management, as well as policies covering specific areas such as credit risk, liquidity risk, price risk and Foreign Exchange Risk effecting business operations. The company’s risk management is carried out by the management as per guidelines and policies approved by the Board of Directors.
1 Market risk
a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the Company's position with regard to interest income and interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of the fixed rate and floating rate financial instruments in its total portfolio.
51 FIRST TIME ADOPTION OF IND AS
The Company has adopted Ind AS with effect from 1st April 2017 with comparatives being restated. Accordingly the impact of transition has been provided in the Opening Reserves as at 1st April 2016. The figures for the previous period have been restated, regrouped and reclassified wherever required to comply with the requirement of Ind AS and Schedule III.
Explanation 1 - Exemptions and exceptions availed
Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.
(I) Ind AS Optional exemptions
Deemed Cost - Property, Plant and Equipment, Capital work-in-progress and Intangible Assets
Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment, Capital work-in-progress and intangible assets at their previous GAAP carrying values.
(II) Ind AS mandatory exemptions (I) Estimates
An entity's estimates in accordance with Ind AS' at the date of transition to Ind AS shall be consistent with the estimates made for the same date in accordance with the previous GAAP (after adjustments to reflect any difference in accounting policies) unless there is an objective evidence that those estimates were in error.
(ii) Classification and measurement of financial assets (other than equity instruments)
Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exists at the date of transition to Ind AS.
(iii) De-recognition of financial assets and financial liabilities
Ind AS 101 requires a first time adopter to apply the de-recognition provisions for Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows first time adopter to apply the derecognition requirements provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past Ind AS 101 retrospectively from the date of entity's choosing, transactions was obtained at the time of initially accounting for the transactions.
Note No.:
1 Long term borrowing
Long term borrowings from Bank and financial institution have been recognized as financial liabilities and have been measured at fair value through amortized cost using effective rate of interest. Interest expense is recgonised using effective rate of interest. This change the amount of borrowing by Rs, 1.30 Lakhs as at 31 March 2017 (1 April 2016 Rs. Nil). Consequently, the total equity increased by an equivalent amount
2 Investments
Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognized in FVOCI Equity investments reserve as at the date of transition. This increased other reserves by Rs, 11.14 lakhs as at 31 March 2017 (1 April 2016 -Rs,10.86 lakhs).
3 Security Deposits
Under the previous GAAP, interest free security deposits are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognized at fair value. Accordingly, the group has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposits have been recognized in retained earnings.
4 Warranty provision
Warranty provisions is determined based on the historical percentage of warranty expense to sales for the same types of goods for which the warranty is currently being determined. The same percentage to the sales is applied for the current accounting period to derive the warranty expense to be accrued.
5 Others
Depreciation related to lease hold land has been reversed. As a result of this change, the profit for the year ended 31 March 2017 incresed by Rs. .99 Lakhs (1 April 2016 Rs. .29 Lakhs). Consequently, the total equity increased by an equivalent amount.
6 Deferred tax
Under previous GAAP, deferred taxes were recognized based on Profit & loss approach i.e. tax impact on difference between the accounting income and taxable income. under Ind AS, deferred tax is recognized by following balance sheet approach i.e. tax impact on temporary difference between the carrying value of assets and liabilities in the books and their respective tax base.
7 Remeasurements of post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended 31 March 2017 decreased by Rs. 11.25 Lakhs (1 April 2016 Rs. 3.84 Lakhs). There is no impact on the total equity as at 31 March 2017 (1 April 2016).
8 Property, Plant and Equipment and Investment Property
Under the previous GAAP, Investment Property, Land & Bulding of Rs. 7.19 lakhs as on 31 March 2017 (1 April 2016 Rs. 7.38 lakhs) was grouped under Property Plant and Equipment. Under Ind AS, the same is treated as Investment property under Ind AS 40 at carrying cost under previous GAAP. There is no impact on the total equity and profit.
9 Revenue
Under previous GAAP, revenue from sale of goods was presented net of excise duty whereas under IND AS the revenue from sale of goods is presented inclusive of excise duty. The excise duty is presented on the face of the Statement of Profit and Loss. This change has resulted in an increase in total revenue and total expenses for the year ended 31 March 2017 by Rs. 14.31 Lakhs. There is no impact on the total equity and profit.
Under the previous GAAP, certain discounts was shown in expenses. Under Ind AS, the same has been netted from revenue amounting to Rs. 199.56 lakhs. There is no impact on the total equity and profit.
10 Reclassification
Reclassification of financial assets and financial liabilities has been done as required as per Ind AS Sch III
1. The previous year figures have been regrouped/reclassified, wherever necessary to conform to the current presentation as per the schedule III of Companies Act, 2013.
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