1. Terms/rights attached to Equity Shares
The company has only one class of equity shares having a face value of Rs. 10/- (Rupees Ten) per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to received remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. In the event of distributing dividends by the company and winding up, the preference shareholders will be preferred over the equity shareholders. They do not have any voting rights except for in the conditions mentioned in the Companies Act, 2013.
2. Terms/rights attached to Preference Shares
During the year 2016-17, the Company has issued and alloted 1,60,000 Non Convertible, Cumulative, Redeemable Preference Shares of face value Rs.100/- each fully paid to Promoter and redemable at par within a period not exceeding 5(five) years. The allotment was completed in 4 trances details as dated 09.11.2016 no of shares 35000 @ Rs.100/-,dated 21.11.2016 no of shares 39000 @ Rs.100/-, dated 31.01.2017 no of shares 6000 @ Rs.100/-, dated 09.02.2017 no of shares 80000 @ Rs.100/-.These Shares carry Dividend rate @10% (Ten Percent) Per Annum and voting rights of these shares are limited to matters which directly affect the rights of Preference Shareholders. However the company, reserve the right to recall the shares at any time within a period not exceeding 5 years from the date of allotment as per the provisions of Companies Act,2013. These shares are not listed on any stock exchange.
3. Authorised Share Capital
During the year March 31,2012, the authorised share capital has been increased from Rs. 12,00,00,000 (Rupees Twelve Crores) divided into 1,20,00,000 (One Crore Twenty Lacs) Equity Shares of Rs. 10 (Rupee Ten) each to Rs. 14,00,00,000 (Rupees Fourteen Crores) divided into 1,20,00,000 (One Crore Twenty Lacs) Equity Shares of Rs. 10 (Rupee Ten) each and 2,00,000 (Two Lakh) Non Covertible, Cumulative, Redeemable Preference Shares of Rs.100 (Rupees Hundred) each at the Annual General Meeting of the Company held on September 26, 2011. During the year March 31,2013 the authorised share capital has been increased from Rs. 14,00,00,000 (Rupees Fourteen Crores) divided into 1,20,00,000 (One Crore Twenty Lacs) Equity Shares of Rs. 10 (Rupee Ten) each and 2,00,000 (Two Lakh) Non Covertible, Cumulative, Redeemable Preference Shares of Rs. 100 (Rupees Hundred) each to Rs. 15,60,00,000 (Rupees Fifteen Crores Sixty Lakhs) divided into 1,20,00,000 (One Crore Twenty Lacs) Equity Shares of Rs. 10 (Rupee Ten) each and 3,60,000 (Three Lakh Sixty Thousand) Non Covertible, Cumulative, Redeemable Preference Shares of Rs. 100 (Rupees Hundred) each in the Annual General Meeting of the Company held on September 26, 2012. During the year March 31,2016, the authorised share capital has been increased from Rs. 15,60,00,000 (Rupees Fifteen Crores Sixty Lacs only) divided into 1,20,00,000 (One Crore Twenty Lacs) Equity Shares of Rs. 10 (Rupee Ten) each amounting to Rs. 12,00,00,000 (Rupees Twelve Crores) and 3,60,000(Three Lac Sixty Thousand) Non Covertible, Cumulative, Redeemable Preference Shares of Rs. 100 (Rupees Hundred) each amounting to Rs. 3,60,00,000 (Rupees Three Crore Sixty Lacs only) to Rs. 17,10,00,000 (Rupees Seventeen Crore Ten Lacs only) divided into 1,35,00,000 (One Crore Thirty Five Lacs) Equity Shares of Rs. 10 (Rupee Ten) each amounting to Rs. 13,50,00,000 (Rupees Thirteen Crore Fifty Lacs only) and 3,60,000(Three Lacs Sixty Thousand) Non Covertible, Cumulative, Redeemable Preference Shares of Rs. 100 (Rupees Hundred) each amounting to Rs. 3,60,00,000 (Rupees Three Crore Sixty Lacs only) in the Extra Ordinary General Meeting of the Company held on January 29, 2016.
4. Term Loans from Banks and others referred above are secured by way of first charge on entire movabale fixed assets and equitable mortgage Factory Land & Building and Plant & Machinery and other fixed assets .
5. Vehicle loans are secured by way of hypothecatioon of vehicles.
6. Provision for Employees Benefits include Provision for Gratuity & Provision for Leave Encashment.
7. Working Capital loans along with non-fund based facilities from banks are secured by way of hypothecation of present and future stock of raw materials, work-in-process, finished goods, book debts as first charge which ranks Pari-passu amongst Bankers and by way of First and Second charge on the immovable and movable assets of the company by respective banks and pledge of FDR Rs. 444.24 Lakhs)
8. Amount due to Micro, Small and Medium Enterprise:
In absence of any information submitted by vendors with regards to their registration (filing of Memorandum) under the “The Micro, Small and Medium Enterprises Development Act, 2006” Liabililty cannot be ascertained at the close of the year and hence no disclosure is made in this regard.
9. Provision for Employees Benefits include provision for Gratuity & Provision for Leave Encashment.
Note 10: First time adoption of Ind AS
This financial statement is the first financial statement that has prepared in accordance with the Ind AS together with the comparative period data as at and for the year ended 31st March 2017, as described in the summary of significant accounting policies. The transition date to Ind AS had been carried out in accordance with Ind AS 101-First Time Adoption of Indian Accounting Standards with 1st April 2016 as the transition date.
This note explains the exemptions availed by the company on first time adoption of Ind AS and the principal adjustments made by the company in restating its previous GAAP financial statements as at 1st April 2016 ad financial statements as at and for the year ended 31st March 2017 in accordance with Ind AS 101.
Exemption in accordance with Ind-AS 101 (First Time Adoption of Indian Accounting Standards)
a) For transition to Ind AS, the company has selected to adopt historical value of Building, Plant and Machinery recognized as of April 1 2016 as the deemed cost as of the transition date.
b) The company has availed the exemption of fair value measurements of financial assets or liabilities at initial recognition and accordingly has applied fair value measurement of financial assets or liabilities at initial recognition prospectively to transactions entered into on or after 1st April 2016.
c) The estimates as 1st April 2016 and at 31st March,2017 are consistent with those made for the same dates in accordance with previous GAAP (after adjustments to reflect and differences in accounting policies) apart from the following items, which, under previous GAAP did not require estimation:
- Fair values of financial assets & financial liabilities
The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions as at 1st April 2016 and 31st March 2017.
Notes to reconciliation of equity as at 1 April 2016 and 31st March 2017 and total comprehensive income for the year ended 31st March 2017
a) Borrowings:
Under previous GAAP transaction cost incurred in connection with borrowings are amortised upfront and charged to profit or loss for the period. Under Ind AS, transaction cost are included in the initial recognition amount of financial liability and charged to profit or loss using the effective interest method. Therefore borrowings as at 31st March 2018 have been reduced with the transaction cost of Rs. 6.00 Lakhs
b) Dividend (including dividend tax)
Under Ind AS, dividend to holders of preference shares is recognized as liability in the period in which the obligation to pay is established. Under Previous GAAP, dividend payable is recorded as a liability in the period to which it relates. This has resulted in as increase in equity by Rs. 16.86 Lakhs and Rs. 19.26 Lakhs as at 31st March 2017 and 1st April, 2016 respectively. Dividend paid on preference share capital (financial Liability) has been treated as finance cost under Ind AS so has been deducted from the total comprehensive income for the year 2016-17.
c) Employee benefits
Under previous GAAP, actuarial gains and losses were recognized in the statement of profit and loss. Under Ind AS, the actuarial gains and losses form part of re-measurement of net defined benefit liability/ asset which is recognized in other comprehensive income in the respective periods. This difference has resulted in increase in net comprehensive income of Rs. 6.80 Lakhs for the year ended 31st March, 2017. However, the same does not result in difference in equity or total comprehensive income.
d) Fair Valuation of Property, Plant and Machinery
For transition to Ind AS, the company has elected to adopt carrying value or historical value of Building, Plant and Machinery recognised as of 1st April 2016 as the deemed cost as of the transition date.
e) Deferred revenue expenditure
Under previous GAAP, deferred revenue expenditure had been capitalised under ledger name “product development” as at 1st April 2016 of Rs. 71.98 Lakhs which has been written-off to the extent of Rs. 23.99 Lakhs during the year 2016-17. Under Ind AS, No such deferred revenue expenditure is allowed to be capitalised and hence such expenditure had been fully written-off from equity as at 1st April 2016. The expenditure written-off to the extent of Rs. 23.99 Lakhs had been added to the total comprehensive income for the year ended 31st March 2017.
f) Preference Share Capital
Under previous GAAP redeemable preference share capital is required to be reported under equity. Under Ind AS redeemable preference share capital with cumulative dividend right is a financial liability to be reported as a non current borrowing and hence has been reduced from equity.
c) Capital & Other Commitments
Estimated amounts of contracts remaining to be executed on capital account and not provided for (Net of Advances) Nil (P.Y. Rs. Nil).
B. Employee benefits
Defined benefit plan
The following table sets out the details of the defined benefits retirement plans and the amounts recognition in the financial statement:
I. Defined Contribution Plans
a. Provident Fund
b. Employers’ contribution to Employees’ State Insurance
During the year, the Company has recognized the following amounts in the Profit and Loss Account:
II. Defined Benefits Plans
Contribution to Gratuity Fund and Leave Encashment (Unfunded Scheme) in accordance with Ind AS 19, actuarial valuation was performed in respect of the aforesaid defined benefit plans based on the following assumptions:
H. (a) In respect of amounts as mentioned under 205C of the Companies Act, 2013 there were no dues required to be credited to the Investor Education and Protection Fund as at March 31, 2018.
(b) Other Liabilities includes CSR liability of Rs. 21.42 Lakhs
I. BASIC AND DILUTED EARNINGS PER SHARE :
The basic earnings per equity share is computed by dividing the net profit attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of equity shares and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares. The dilutive potential equity shares are adjusted for the proceeds receivable, had the shares been actually issued at fair value.
Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date. The number of equity shares and potential diluted equity shares are adjusted for stock split, bonus shares, Convertible Preference Shares, Share Warrants and the potential dilutive effect of Employee Stock Option Plan as appropriate.
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