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Notes to Accounts of Alicon Castalloy Ltd.

Mar 31, 2015

(a) Rights, preferences and restrictions attached to shares Equity Shares of Rs, 5/- each:

The Company has one class of equity shares having a par value of Rs, 5/- per share. 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.

Notes

(a) Long-term borrowings include secured term loans at floating interest rates from State Bank of India, Bank of India, Bank of Maharashtra & Bajaj Finance Ltd which are repayable through monthly/ quarterly installments. State Bank of India & Bank of Maharashtra loans are secured by a first parri-passu charge by way of equitable mortgage on the existing fixed assets except Khed land which has exclusive charge of Bajaj Finance Ltd. Of these, Rs, 151,292,065/- (PY Rs, 6,23,00,000/-) are classified as current liabilities being repayable before March 31, 2016.

Total number of installments = 231

Number of installments outstanding as at March 31, 2015 = 200 (PY = 62)

Notes

(a) Short-term borrowings includes cash credit facilities availed from State Bank of India, Bank of India, Kotak Mahindra Bank and Bank of Maharashtra. These loans are secured in favour of all the aforementioned banks by a first parri-passu charge by way of hypothecation of all stocks and receivables and a second parri-passu charge by joint Deed of Hypothecation on all fixed assets of the Company.

(b) Unsecured term loans from banks includes loans obtained from Kotak Mahindra Bank for funding purchase orders. These loans, obtained at floating interest rates, are repayable through weekly instalments.

Number of installments outstanding as at March 31, 2015 = 1 (PY = 8)

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

1. Related Party Disclosure

Atlas Castalloy Limited Associates Company Associates Company

Silicon Meadows Engineering Ltd. Associates Company Associates Company

Alicon Holding - GmbH Wholly Owned Subsidiary Wholly Owned Subsidiary

lllichmann Castalloy - GmbH Wholly Owned Subsidiary Wholly Owned Subsidiary

lllichmann Castalloy - sro Wholly Owned Subsidiary Wholly Owned Subsidiary

Shailendrajit Rai - Managing Director Key Managerial Peronnal Key Managerial Peronnal

Rajeev Sikand - Group Chief Executive Officer Key Managerial Peronnal Key Managerial Peronnal

Vimal Gupta - Group Chief Financial Officer Key Managerial Peronnal Key Managerial Peronnal

P S Rao - Company Secretary Key Managerial Peronnal Key Managerial Peronnal

*** Revenue expenditure comprises of Cost to R&D employees, material cost, travelling expenses and utilities.

PARTB

1. Segment Reporting

The Company has single business segment viz. that of aluminum castings. Accordingly, disclosure requirements as per Accounting Standard 17 "Segment Reporting" specified in the Companies (Accounting Standard) Rules 2006 are not strictly applicable to the Company so far as standalone financial statements of the Company are concerned. However, in accordance with paragraph 4 of Accounting Standard 17 (Segment Reporting), details of segment report have been included in Consolidated Financial Statements.

2. Excise Duty

Excise Duty being recovered from the customers through sales invoices raised on them during the year, have been reported separately as a deduction from 'Income from Operations' in the statement of Profit and Loss.

3. Borrowing

Of total borrowing cost of Rs, 1,715.28 Lacs (PYRs, 1,021.78 Lacs) incurred during the year, Rs, 73.16 Lacs (FYRs, Nil) have been capitalized, as identified/relatable to the particular qualifying assets.

4. Sundry Creditors

Sundry Creditors include a sum of Rs, 1,645.40 Lacs (PYRs, 1,645.40 Lacs) as payables which are not expected to be settled in medium term. During the year, the Company was able to procure confirmation from some of its suppliers for goods and services as to their status and classification for each of them under the Micro, Small and Medium Enterprises Act, 2006 (Act). The principal amount remaining unpaid to the suppliers covered under the Act as at the end of the year have been, to the extent information available, shown and classified separately under schedule 11 of Current Liabilities. Also, disclosed below are the amount due to the suppliers beyond the appointed date and amount of interest accrued and remaining unpaid as at the end of the year.

5. All current assets, loans and advances are stated at values realizable in the ordinary course of business and all known liabilities are adequately provided for in the opinion of the board.

6. The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been include in the Consolidated Financial Statements.


Mar 31, 2013

1. Employee Benefits

The Company has adopted Accounting Standard 15 "Employee Benefits". The disclosures required by the Standard are given below:

2. Commitment and Contingent Liabilities

Commitments

Estimated amount of contracts remaining to be executed on capital 152.21 336.09

Contingent Liabilities

a) Letters of Credit issued by the bank against purchase of goods 282.82 1,401.16

b) Performance and Financial Guarantees issued by the banks 344.40 296.62

c) Customs and related duties for non fulfillment of Export Obligation 418.52 744.20

d) Pending Case in local Civil Court 349.67 353.63

Total 1,395.41 2,795.61

3. Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges Loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such parties:

PART B

1. Segment Reporting

The Company has single business segment viz. that of aluminium castings. Accordingly, disclosure requirements as per Accounting Standard 17 "Segment Reporting" specified in the Companies (Accounting Standard) Rules 2006 are not strictly not applicable to the Company so far as standalone financial statements of the Company are concerned. However, in accordance with paragraph 4 of Accounting Standard 17 (Segment Reporting), details of segment report have been included in Consolidated Financial Statements.

2. Excise Duty

Excise Duty being recovered from the customers through sales invoices raised on them during the year, have been reported separately as a deduction from ''Income from Operations'' in the statement of Profit and Loss.

3. Borrowing Cost

Of total borrowing cost of Rs. 1,042.63 Lacs (PY Rs. 1,230.03 Lacs) incurred during the year, Rs. 106.71 Lacs (PY Rs. 23.82) have been capitalized, as identified/relatable to the particular qualifying assets.

4. Sundry Creditors

Sundry Creditors include a sum of Rs. 1,645.40 Lacs (PY Rs. 1,675.75 Lacs) as payables which are not expected to be settled in medium term. During the year, the Company was able to procure confirmation from some of its suppliers for goods and services as to their status and classification for each of them under the Micro, Small and Medium Enterprises Act, 2006. The principal amount remaining unpaid to the suppliers covered under the Act as at the end of the year have been, to the extent information available, shown and classified separately under schedule 9 of Current Liabilities. Also, disclosed below are the amount due to the suppliers beyond the appointed date and amount of interest accrued and remaining unpaid as at the end of the year.

5. All current assets, loans and advances are stated at values realisable in the ordinary course of business and all known liabilities are adequately provided for in the opinion of the board.

6. The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

CORPORATE INFORMATION

Alicon Castalloy Limited (the Company) is listed on the Bombay Stock Exchange and National Stock Exchange. It is engaged in the manufacturing and selling of aluminium die castings.


Mar 31, 2010

1. Intangible Assets

Intangible Assets are recognized only if it is probable that the future economic benefits that are attributable to the assets will flow to the enterprises and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortisation and accumulated impairment losses ascertained, if any.

2. Impairment of Assets

An asset is treated as impaired when identified and when the carrying amount of the asset exceeds it recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

However, post demerger, various assets have been identified as impaired and impairment joss, being excess of the carrying amount over fair values of the assets have been written of to Business Construction Reserve.

3. investments

All Long-term investments, which are unquoted, are stated at cost.

4. Inventories

i. Raw Materials

Inventory of Raw materials are valued at cost. Cost represents purchase price, net of recoverable taxes, determined with reference to last purchases.

ii. Semi - Finished Goods

Inventory of Semi-finished goods are valued at lower of cost of net realisable value. Cost comprises of material cost and conversion cost.

Conversion cost includes cost of consumables, direct labour, and variable overheads in proportion to direct labour and fixed cost in respect of production facilities.

During the year, the Company has changed its policy and method of valuation of inventories of all items of semi-finshed to lesser of cost or net realizable value. The change in policy is as required by the statue and thus is in compliance of the policy and method of valuation prescribed under the Accounting Standard (AS-2) Valuation of Inventories

Had there been no change in the accounting policy in respect of valuation of inventories, the Companys profit before taxes would have been more by Rs. 43.79 lakhs.

iii. Consumables, Stores and Spares

Consumables Stores and Spares are valued at cost. Cost represents purchase price, net of recoverable taxes, and is determined on FIFO basis.

iv. Dies and Moulds

The expenditure on development of Dies and Moulds commissioned on behalf of the customers is carried in the books at the appropriate cost of development, as Current Assets, subject to such cost not exceeding the maximum value contracted to be paid by the customer. Income from development and development cost of such dies is accounted for in the year in which they are completed and invoiced.

The unfunded cost of such dies, if any, is written off to the revenue in the event of their commercial obsolescence.

v. Inter-division Transfers

Interdivisional transfers are valued, either at ex-factory cost of the transfer or unit/division, net of recoverable taxes and are recorded on physical receipt.

5. Transactions in Foreign Currencies

Foreign currency transactions are recorded at the exchange rate prevailing as at the date of transaction except sales which are recorded at a rate notified for a month, by the customs, for invoice purposes.

All exchange differences arising on restatement of all monetary foreign currency assets and liabilities are credited or debited, as the case may be, to the Profit and Loss Account.

6, Derivative instruments

Derivative contracts are entered into by the company only based on underlying transaction.

Forward and Options contract are fair valued at each reporting date and the resulting gain or loss from these transaction are recognized in the Profit and Loss Account of such reporting period.

7. Taxes on income

Income tax expense comprises current tax and deferred tax charge /credit.

Current tax is the amount of tax worked out on the taxable income for the year determined in accordance with the relevant provisions of the Income Tax act, 3961 in force and is on an estimate basis.

Deferred tax is recognised subject to the consideration of prudence, on timing differences between accounting income and taxable income that originate in one period and are capable of reversal in one or more subsequent periods.

Deferred tax assets, if any, are recognised, only when there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

8. Employee Benefits Defined contribution plans

Contributions to defined contribution approved Provident Fund and Pension Fund, defined contribution schemes, are made at pre-determined rates and charged to the Profit and Loss Account, as incurred. Post-employment benefit plans Contributions to defined contribution retirement benefit schemes are recognised as an expense when employees have rendered services entitling them to contributions using Projected Unit Credit Method, with actuarial valuations being carried out by an independent valuer. Actuarial gains and losses have been recognised in full in the profit and loss account for the year. Past service cost has also been recognised to the extent that the benefits are already vested. The retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit obligation as adjusted for as reduced by the fair value of scheme assets. Short-term employee benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognised during the period when the employee renders the service. These benefits include compensated absences such as paid leave, performance incentives, bonus, ex-gratia etc.

Long-term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as an actuarial liability determined by an independent valuer being the present value of the defined benefit obligation at the balance sheet date.

The liability towards Workmen Compensation is also funded with New India Insurance and contribution made towards this is charged to the Profit and Loss Account.

9. Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as a part of the cost of such assets. All other borrowing costs incurred and which are not identified to the particular qualifying assets is charged to revenue.

10. Leases

The Companys rental/hire arrangements are in respect of operating leases for guest-houses and a few machineries. The arrangements normally range between eleven months to twenty- two months renewable by mutual consent on agreed terms and thus are short term nature and no significant obligations are attached thereto.

11. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes to accounts. Contingent Assets are neither recognised nor disclosed in the financial statements.

 
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