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Notes to Accounts of AIA Engineering Ltd.

Mar 31, 2015

1. Share Capital:

1.1 Rights, preferences and restrictions attached to Equity Shares:

The Company has one class of Equity Shares having a par value of Rs.2 each. Each Shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting. In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

During the year ended 31st March, 2015, the amount of Dividend proposed by the Board of Directors of the Company to the Equity Share holders is Rs.8.00 per Share (Previous Year Rs.6 per Share)

2. Terms of repayment for Buyers Credit:

The Company has availed Buyer''s Credit of GBP 330204.10 and EURO 14840.46 are secured by first and exclusive charge over specific Plant and Machinery being imported. The Buyer''s Credit loans are repayable at 4th January, 2016 and 9th February, 2016 respectively. The Interest rates are determined as a spread over 90 /180 days LIBOR and the spread is a function of liquidity available with the Bank.The Buyer''s Credit finance arranged in this financial year has been at a spread of 150 bps over LIBOR.

3. Employee Benefits Expense:

Defined Benefit Plan:

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

Company''s estimate of Contributions expected to be paid during Financial Year 2014-15 is as under:

(i) Defined Contribution Plan :

- Employer''s contribution to Provident Fund : 12% of Basic Salary

(ii) Defined Investment Plan :

(a) Gratuity Rs. in Lacs : 243.40

(b) Leave encashment : Not applicable as Leave Liability is not funded

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of plan assets held, assessed risks, historical results of return on plan assets and the Company''s policy for plan assets management.

4. Related party disclosures under Accounting Standard 18:

(i) Subsidiaries:

1. Welcast Steels Limited, Bangalore

2. Vega Industries (Middle East) FZE, U.A.E.

3. Vega Industries Ltd., U.K.

4. Vega Industries Ltd., U.S.A.

5. Vega Steel Industries (RSA) PTY Ltd., South Africa

6. Wuxi Weigejia Trade Co. Ltd., China

(ii) Relatives of Key Management Personnel:

1. Mrs. Giraben K. Shah

2. Mrs. Gitaben B. Shah

3. Mrs.Khushali Samip Solanki

4. Mrs.Bhumika Shyamal Shodhan

5. AB Tradelink Ltd.

6. Powertec Engineering Pvt. Ltd.

7. Vee Connect Travels Pvt.Ltd.

8. Discus IT Pvt Ltd.

(iii) Key Management Personnel:

1. Mr.Bhadresh K. Shah (Managing Director)

2. Mr.Yashwantbhai M. Patel (Whole-time Director)

3. Dr. S. Srikumar (Non Executive Director)

5. Based on the guiding principles given in Accounting Standard on "Segment Reporting " (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

6. Contingent Liabilities and Commitments (To the extent not provided for):

Particulars As at As at 31st March, 31st March, 2015 2014 Rs. Lacs Rs. Lacs

1. Contingent Liabilities:

a. Claims against the Company not acknowledged as debts

i) Central Excise & Service Tax 1,714.84 3,698.49

ii) Income Tax 5,932.31 4,977.25

iii) Sales Tax / Central Sales Tax 19.77 19.77

b. Guarantees

i) Bank Guarantees Outstanding 12,365.53 6,921.40

ii) Corporate Guarantees Outstanding to Customers 713.65 5,566.94

iii)Guarantees given by the Company on behalf of Subsidiaries 3,621.31 3,490.51

iv) Corporate Guarantees given by the Company on behalf of Subsidiaries 2,632.28 2,033.05

v) Letter of Credit (L/C) 33.55 765.58

c. Others 650.05 628.32

2. Commitments :

Estimated amount of Contracts remaining to 2,782.82 939.58 be executed on Capital Account and not provided for.

Total 30,466.11 29,040.89

6. Previous Year''s figures have been regrouped / reclassified wherever necessary to confirm to current year presentation.


Mar 31, 2014

1.1 Rights, preferences and restrictions attached to Equity Shares:

The Company has one class of Equity Shares having a par value of Rs. 2 each. Each Shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting. In the event of liquidation, the Equity Shareholders are eligible to receive the remaining Assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

During the year ended 31st March, 2014, the amount of Dividend proposed by the Board of Directors of the Company to the Equity Shareholders is Rs. 6 per Share (Previous Year Rs. 4 per Share)

1.2 Aggregate number and class of shares allotted as fully paid up pursuant to contract(s) without payment being received in cash:

336,430 Equity Shares (Previous Year 336,430) of Rs. 2 each fully paid-up have been issued to the Shareholders of the Amalgamating Company i.e. Reclamation Welding Ltd. pursuant to the Scheme of Amalgamation with the Company during the Financial Year 2009-10.

1.3 Terms of repayment for External Commercial Borrowings:

External Commercial Borrowings ( ECB ) of US $ 18700000 is secured by hypothecation of Identified Plant and Machineries procured / to be procured from it and to be installed at Moraiya Unit ( M1 ) of the Company mentioned in Hypothecation Agreement. The Loan is repayable in 15 equal quarterly instalments of US$ 1246667 after a moratorium period of 18 months from the date of first draw-down i.e. 3rd October, 2012. Interest rates are reset every three months at the rate of 3 months US$ LIBOR plus 285 bps p.a.. The first Instalment will due on 3rd April, 2014 and the loan will be fully re-paid on 3rd October, 2017.

1.4 Terms of repayment for Buyers Credit:

The Company has availed Buyers Credit of GBP 330204.10 and EURO 14840.46 are secured by first and exclusive charge over specific Plant and Machinery being imported. The Buyers Credit loans are repayable at 4th January, 2016 and 9th February, 2016 respectively. The Interest rates are determined as a spread over 90 /180 days LIBOR and the spread is a function of liquidity available with the Bank. The Buyers Credit finance arranged in this financial year has been at a spread of 150 bps over LIBOR.

1.5 Terms of repayment for Buyers Credit:

The Company had availed Buyers Credit / Packing Credit of US$ 1827108.33 and US$ 5000000 respectively which are secured by Hypothecation of entire chargeable Current Assets of the Company including Stocks of Raw Materials, Stores and Spares, Work-in-progress and Receivables on pari-passu basis. The Interest rates are determined as a spread over 90 /180 days LIBOR and the spread is a function of liquidity available with the Bank. The Buyers Credit finance arranged in this financial year had been at a spread of 150 bps over LIBOR. It has been fully repaid during the year.

Defined Benefit Plan:

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan.The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

2. Amalgamation of DCPL Foundries Ltd.

Scheme of Amalgamation of DCPL Foundries Ltd. (DCPL) with the Company, a wholly - owned Subsidiary of the Company, has been sanctioned by the Hon''able High Court of Gujarat, Ahmedabad vide its order dated 4th April, 2014 (a copy of the order received on 2nd May, 2014).

The Scheme of Amalgamation has become effective from 3rd May, 2014 and has been implemented with effect from the Appointed Date i.e. 1st April, 2013. The principal business of DCPL was to manufacture of Alloy Steel Castings. The Assets and Liabilities of the erstwhile DCPL were transferred and vested in the company with effect from the appointed date and accordingly was given effect in the accounts. DCPL being Wholly-owned Subsidiary of the Company, all the 1000000 Equity Shares of Rs. 10 each held by the Company in the erstwhile DCPL have been cancelled.

The Amalgamation has been accounted for under the "Purchase Method" as prescribed by Accounting Standard 14 (AS-14) " Accounting of Amalgamations". The difference of Rs. 76,780,684 between the value of net assets taken over and the Cost of investment of the Company in the Shares of DCPL has been debited to Goodwill Account, which will be amrortized over a period of five years.

3. Related party disclosures under Accounting Standard 18:

(i) Subsidiaries:

1 Welcast Steels Limited, Bangalore, India

2 Vega Industries (Middle East) FZE, U.A.E.

3 Vega Industries Ltd., U.K.

4 Vega Industries Ltd., U.S.A.

5 Vega Steel Industries (RSA) Proprietary Ltd., South Africa

6 Wuxi Weigejia Trade Co. Ltd., China

(ii) Relatives of Key Management Personnel:

1 Mrs. Giraben K. Shah

2 Mrs. Gitaben B. Shah

3 AB Tradelink Ltd.

4 Powertec Engineering Pvt. Ltd.

(iii) Key Management Personnel:

1 Mr. Bhadresh K. Shah (Managing Director)

2 Mr. Yashwantbhai M. Patel (Whole-time Director)

3 Dr. S. Srikumar (Non Executive Director)

4. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

5. Contingent Liabilities and Commitments (To the extent not provided for):

Particulars As at As at 31st March, 2014 31st March, 2013 Rs. Lacs Rs. Lacs

1. Contingent Liabilities:

a. Claims against the Company not acknowledged as debts

i) Central Excise & Service Tax 3,698.49 1,642.65

ii) Income Tax 4,977.25 -

iii) Sales Tax / Central Sales Tax 19.77 48.21

iv) Award of Damages in Patent matter by District Court of - 3,924.02

Nashville, Tennessee, U.S.A., which is disputed by the Company (US$ 7228544.64)

v) Others 6 28.32 -

b. Guarantees

i) Bank Guarantees Outstanding 6,921.40 6,676.93

ii) Corporate Guarantees Outstanding to Customers 5,566.94 991.61

iii) Guarantees given by the Company on behalf of Subsidiaries 3,490.51 2,612.15

iv) Corporate Guarantees given by the Company on behalf of Subsidiaries 2,033.05 1,837.49

v) Letter of Credit (L/C) 765.58 2,182.39

2. Commitments :

Estimated amount of Contracts remaining to be executed on 939.58 2,633.51

Capital Account and not provided for.

Total 29,040.89 22,548.96

The Company enters in to derivative contracts strictly for hedging purposes and not for trading or speculation.The Company has voluntarily adopted Accounting Standard (AS) 30 "Financial Instruments" : Recognition and Measurement" to the extent the standard does not conflict with the Accounting Standards notified under Section 211(3C) of the Companies Act, 1956. Pursuant to the adoption, the Net Gain on foreign currency forwards and Interest rate swap of Rs. 946.45 lacs as required by AS-30 has been parked in the Cash Flow Hedging Reserve under Reserves & Surplus. This gain would be recycled in the Statement of Profit and Loss / Fixed Assets in the period during which the forecasted transactions occurs.

6. Previous Year''s figures have been regrouped / reclassified wherever necessary to confirm to current year presentation. The figures for the previous year do not include figures for the erstwhile DCPL and accordingly the current year''s figures are not comparable to those of the previous year.


Mar 31, 2013

1. Related party disclosures under Accounting Standard 18:

(i) Subsidiaries:

1 Welcast Steels Limited, Bangalore

2 DCPL Foundries Ltd., Trichy

3 Vega Industries (Middle East) FZE, U.A.E.

4 Vega Industries Ltd., U.K.

5 Vega Industries Ltd., U.S.A.

6 Vega Steel Industries (RSA) PTY Ltd., South Africa

7 Wuxi Weigejia Trade Co. Ltd., China

(ii) Relatives of Key Management Personnel:

1 Mrs. Giraben K. Shah

2 Mrs. Gitaben B. Shah

3 AB Tradelink Ltd.

4 Powertec Engineering Pvt. Ltd.

(iii) Key Management Personnel:

1 Mr.Bhadresh K. Shah (Managing Director)

2 Mr.Yashwant M. Patel (Whole time Director)

3 Dr. S. Srikumar (Non Executive Director)

2. Based on the guiding principles given in Accounting Standard on " Segment Reporting " (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

3. Previous Year''s figures have been regrouped / reclassified wherever necessary to confirm to current year presentation.


Mar 31, 2012

1.1 Rights, preferences and restrictions attached to Equity shares :

The company has one class of equity shares having a par value of Rs.2 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

During the year ended 31st March, 2012, the amount of Dividend proposed by the Board of Directors of the Company to the Equity Share holders is Rs.3 per Share ( Previous Year Rs.3 per Share)

1.2 Aggregate number and class of shares allotted as fully paid up pursuant to contract(s) without payment being received in cash.

336,430 Equity Shares (Previous Year 336,430) of Rs.2/- each fully paid-up have been issued to the Shareholders of the Amalgamating Company i.e. Reclamation Welding Ltd. pursuant to the Scheme of Amalgamation with the Company during the Financial Year 2009-10.

* Deferred Sales tax under Package Scheme of Incentives 1993 of Maharashtra for erstwhile Paramount Centrispun Castings Pvt.Ltd.

* The Company has not received information from the Suppliers regarding their status under The Micro, Small & Medium Enterprises Development Act, 2006.Hence, disclosures, if any relating to amounts unpaid as at the balance sheet date together with interest paid or payable as per the requirement under the said Act, have not been made.

* There is no amount due to be transferred to Investor Education and Protection fund.

# Includes Statutory dues and advances from customers.

* The Company has hitherto been accounting for export benefits on receipt basis i.e. as and when utilised / sold. During the year the Company changed its method of accounting from receipts to accrual, as a consequence of this , current year export incentives and profit is higher by Rs.3,233.34 Lacs.

Defined Benefit Plan :

The employees' gratuity fund scheme managed by a Trust is a defined benefit plan.The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognised in the same manner as gratuity.

Company's estimate of Contributions expected to be paid during Financial Year 2012-13 is as under:

(i) Defined Contribution Plan :

- Employer's contribution to Provident Fund : 12% of Basic Salary (ii) Defined Investment Plan :

(a) Gratuity : Rs.94.24 Lacs

(b) Leave encashment : Not applicable as Leave Liability is not funded

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of plan assets held, assessed risks, historical results of return on plan assets and the Company's policy for plan assets management.

2. Related party disclosures under Accounting Standard 18 :

(i) Subsidiaries :

1 Welcast Steels Ltd.

2 DCPL Foundries Ltd.

3 Vega Industries (Middle East) FZE, U.A.E.

4 Vega Industries Ltd., U.K.

5 Vega Industries Ltd., U.S.A.

6 Vega Steel Industries (RSA) PTY Ltd.

7 Wuxi Weigejia Trade Co. Ltd.

(ii) Relatives of Key Management Personnel :

1 Mrs. Giraben K. Shah

2 Mrs. Gitaben B. Shah

3 AB Tradelink Pvt. Ltd.

4 Powertec Engineering Pvt. Ltd.

(iii) Key Management Personnel :

1 Mr.Bhadresh K. Shah (Managing Director)

2 Mr.Yashwant M. Patel (Whole time Director)

3 Dr. S. Srikumar (Director)

3 Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

Notes:

1) Geographical Segments considered for disclosures are as follows :

- Sales within India includes Sales to Customers located within India.

- Sales Outside India includes Sales to Customers located outside India.

4 Contingent Liabilities and Commitments (To the extent not provided for) :

Particulars As at As at 31st March, 2012 31st March, 2011 Rs. Lacs Rs. Lacs

1. Contingent Liabilities

a. Claims against the Company not acknowledged as debts

i) Central Excise & Service Tax 1,743.61 1,477.20

ii) Income Tax 2,506.15 1,653.09

iii)Sales Tax / Central Sales Tax 68.50 74.05

b. Guarantees

i) Bank Guarantees Outstanding 6,309.29 4,753.84

ii) Corporate Guarantees Outstanding to Customers 1,141.44 1,087.80

iii)Guarantees given by the Company on behalf of Subsidiaries 1,526.10 307.53

2. Commitments :

Estimated amount of Contracts remaining to be executed on Capital Account 1,191.39 696.36 and not provided for.

Total 14,486.48 10,049.87

5 Derivative Instruments :

a) The Company has entered into forward contracts to offset foreign currency risks arising from the amounts denominated in currencies other than the Indian Rupee. The counter parties to such forward contracts are banks.

The notional mark to market loss on these unexpired contracts as on 31-3-2012 amounting to Rs.829.86 Lacs has not been considered in the Financial Statements. The actual gain / loss could vary and be determined only on settlement of the contracts on their respective due dates.

6 Till the year ended 31st March, 2011, the Company was using Pre-revised Schedule VI to the Companies Act, 1956 for preparation and presentation of its financials Statements. During the year ended 31st March, 2012, the Revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company.The Company has reclassified previous year figures to confirm to this year's classification.

Notes referred to herein above form an integral part of Financial Statements.


Mar 31, 2011

1. Details of utilization of funds received on Qualified Institutions Placement (QIP) Money:

On 19th December, 2006, consequent to Qualified Institutions Placement (QIP), the Company issued and allotted 1020408 Equity Shares of Rs. 10/- each at a premium of Rs. 1215/- per share through Qualified Institutions Placement under Chapter XIII-A of SEBI (Disclosure & Investor Protection) Guidelines 2000 to Qualified Institutional Buyers (QIB).

2. The Company has not received information from the Suppliers regarding their status under The Micro, Small & Medium Enterprises Development Act, 2006. Hence, disclosures, if any relating to amounts unpaid as at the balance sheet date together with interest paid or payable as per the requirement under the said Act, have not been made.

Defined Benefit Plan:

The employees' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of plan assets held, assessed risks, historical results of return on plan assets and the Company's policy for plan assets management.

3. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

4. Related party disclosures under Accounting Standard 18:

(i ) Subsidiaries :

1 Welcast Steels Limited, Bangalore

2 DCPL Foundries Pvt.Ltd., Trichy

3 Vega Industries (Middle East) FZE, U.A.E.

4 Vega Industries Ltd., U.K.

5 Vega Industries Ltd., U.S.A.

6 Vega Steel Industries (RSA) PTY Ltd., South Africa

7 Wuxi Weigejia Trade Co. Ltd., China

(ii) Relatives of Key Management Personnel :

1 Hotel Gulmarg

2 L.D.M. X-ray Clinic

3 K.M.Shah Nursing home

4 Mrs. Giraben K. Shah

5 Mrs. Gita B. Shah

6 AB Tradelink Pvt. Ltd.

7 Powertec Engineering Pvt. Ltd.

(iii) Key Management Personnel :

1 Mr. Bhadresh K. Shah (Managing Director)

2 Dr. S. Srikumar (Director)

8. Contingent Liabilities not provided for in Accounts :

(Rs. Millions)

As at As at

31st March 2011 31st March 2010

a Bank Guarantees Outstanding 475.38 311.48

b Corporate Guarantees Outstanding to Customers 108.78 106.08

c Guarantees given by the Company on behalf of Subsidiaries 30.75 133.87

d Estimated amount of unexecuted Capital Contracts (Net of Advances) not provided for. 69.64 35.03

e Claims against the Company / Disputed Liabilities not acknowledged as Debts

i) Central Excise & Service Tax 147.72 118.05

ii) Income Tax 165.31 17.13

iii) Sales Tax / Central Sales Tax 7.41 14.71

iv) E.S.I.C. Nil 0.12

Total 1004.99 736.47

5. Derivative Instruments :

a) The Company has entered into forward contracts to offset foreign currency risks arising from the amounts denominated in currencies other than the Indian Rupee. The counter parties to such forward contracts are banks.

6. Previous year's figures have been reworked, reclassified, regrouped and rearranged wherever necessary.

7. Secured sectioned loans are secured by paripasu charge in favour of State Bank of India and The Royal Bank of Scotland on Company's movable and immovable properties both persent and future by way of hypothecation and mortgage.


Mar 31, 2010

Cash and Cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

1. Details of utilization of funds received on Qualified Institutions Placement (QIP) Money:

On 19th December 2006, consequent to Qualified Institutions Placement (QIP), the Company issued and allotted 1020408 Equity Shares of Rs.10/- each at a premium of Rs.1215/- per share through Qualified Institutions Placement under Chapter XIII-A of SEBI (Disclosure & Investor Protection) Guidelines 2000 to Qualified Institutional Buyers (QIB).

2. The Company has not received information from the Suppliers regarding their status under The Micro, Small & Medium Enterprises Development Act, 2006. Hence, disclosures, if any relating to amounts unpaid as at the balance sheet date together with interest paid or payable as per the requirement under the said Act, have not been made.

3. As per Accounting Standard 15 "Employee Benefits", the disclosures of Employee benefits as defined in the Accounting Standard are given below:

Defined Contribution Plan:

Defined Benefit Plan:

The Employees Gratuity Fund Scheme managed by a Trust is a Defined Benefit Plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as Gratuity.

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of plan assets held, assessed risks, historical results of return on plan assets and the Companys policy for plan assets management.

4. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India, the Company operates mainly in manufacturing of High Chrome Mill Internals (Castings) and all other activities are incidental thereto, which have similar risk and return, accordingly, there are no separate reportable Segment as far as Primary Segment is concerned.

5. Contingent Liabilities not provided for in Accounts :

(Rs. in Lacs) As at As at 31st March, 2010 31st March, 2009 a Bank Guarantees Outstanding 3114.85 3133.44 b Corporate Guarantees Outstanding to Customers 1060.76 4564.74 c i Guarantees given by the Company on behalf of Subsidiaries 1338.70 821.52 d Letters of Credit NIL 265.66 e Estimated amount of unexecuted Capital Contracts (Net of Advances) not provided for 350.28 0.00 f Claims against the Company / Disputed Liabilities not acknowledged as Debts i) Central Excise & Service Tax 1180.49 901.74 ii) Income Tax 171.34 171.34 iii) Sales Tax / Central Sales Tax 147.10 110.24 iv) E.S.I.C. 1.16 1.16 Total 7364.68 9969.84

6. Derivative Instruments :

a) The Company has entered into forward contracts to offset foreign currency risks arising from the amounts denominated in currencies other than the Indian Rupee. The counter parties to such forward contracts are banks.

Consequent to the announcement issued by the Institute of Chartered Accountants of India on Accounting of Derivatives, details of derivatives contracts outstanding as on 31-3-2010 are as under:

7. During the year, the Company has implemented SAP as ERP Platform and the valuation of Inventory of Raw Materials, Stores and Spares for the year is done on the basis of Moving Weighted Average Method instead of FIFO / YTD average basis applied in the earlier years. Had the Company followed the same Previous Year Method of valuing Inventory of Raw Materials, Stores and Spares, the value of Inventory would have been less by Rs. 72.35 Lacs and consequently Profit for the year ended 31st March 2010 would have been less by Rs. 72.35 Lacs. Further, previous figures are not comparable to that extent.

8. Previous years figures have been reworked, reclassified, regrouped and rearranged wherever necessary.

 
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