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Notes to Accounts of Andhra Petrochemicals Ltd.

Mar 31, 2015

Note 1.

Consequent to schedule II of the Companies Act, 2013 becoming applicable w. e. f., 1.4.2014, depreciation for the year ended 31st March, 2015 has been provided on the basis of the useful life of all the assets as prescribed under Schedule II of the Act. Accordingly the depreciation charge for the year is lower by Rs.407.30 lakhs, when compared to previous year. Further in respect of the assets whose revised useful life has exhausted before 1.4.2014, the carrying amount of the said assets of Rs.211.39 lakhs net of deferred tax of Rs.101.53 lakhs has been adjusted to the retained earnings.

Note 2.

Consequent to the fire accident occurred in Hindustan Petroleum Corporation Ltd. (HPCL), Refinery at Visakhapatnam on 23rd August, 2013, the Company's claim under "Loss of Profits Insurance Policy with extended fire risk coverage at Supplier Premises" is under process with the insurers. Pending admittance of Company's claim by its insurer, the said claim has not been recognized in the books of account for the year under report.

Note 3. Employee benefit plans :

As per Accounting Standard 15 "Employees Benefits" the disclosure of Employee Benefits as defined in the Accounting Standard are given hereunder:

Defined Benefit Plans:

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 compensated absences is recognized in the same manner as gratuity.

Note 4. Segment information:

The Company operates only in one business segment being the manufacture of Oxo-Alcohols and there are no geographical segments to be reported.

Note 5. According to an internal technical assessment carried out by the Company, there is no impairment in the carrying cost of cash gener- ating units of the Company in terms of AS – 28 issued by Companies (Accounting Standards) Rules, 2006 (amended).

Note 6. Previous year's figures have been regrouped and rearranged wherever necessary to make them comparable with the current year figures.


Mar 31, 2014

Rs. in lakhs Particulars This Year Previous Year

Note 1.1: Contingent Liabilities and Commitments: (i) ContingentLiabilities

(a) Claims against the Company not acknowledged as debt 12.00 12.00

(b) Amounts shown by HPCL as dues as per their statements of account contested by the Company 52.91 52.91

(c) Outstanding Guarantees to Banks ncluding Letters of Credit opened with Banks for supplier payments 10.00 10.00

(d) Various Claims made by EPDC of A.P.Ltd. , which are contested by Company i) Grid Support charges 115.97 115.97

ii) Electricity duty demand on captive power generation 115.50 115.48

iii) Disputed demand charges against APGPCL Demand allocation 10.47 10.47

iv) Demand against excess incentive recovery 13.19 13.19

e) Disputed Income Tax demands for the Asst. Years 2006-07, 2008-09 and 2009-10 22.49 24.71

f) Disputed Input Tax Credit Accounting Year 2009-10 (Rs.1.49 lakhs paid under protest - grouped under Short-term Loans & Advances 11.94 --

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for -- 1.96

(b) Bills discounted -- 2346.40

Note 1.2:

Hindustan Petroleum Corporation Ltd., (HPCL), suspended during most part of the year, the supply of "Propylene", the main raw material for production of "Oxo- alcohols", due to a fire accident occurred in a cooling tower of its refinery on 23rd August, 2013, which resulted in suspension of production activities by the Company for a total number of 154 days during the year. Pending admittance of Company''s claim by its insurer under "Loss of Profits insurance policy with extended fire risk coverage at Supplier Premises", the said claim has not been recognised in the books of account for the year under report.

Note 1.3: Employee benefit plans :

As per Accounting Standard 15 "Employees Benefits" the disclosure of Employee Benefits as defined in the Account- ing Standard are given hereunder:

Defined Benefit Plans:

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 compensated absences is recognised in the same manner as gratuity.

Note 1.4: Segment information:

The Company operates only in one business segment being the manufacture of Oxo-Alcohols and there are no geographical segments to be reported.

Note 1.5: According to an internal technical assessment carried out by the Company, there is no impairment in the carrying cost of cash generating units of the Company in terms of AS – 28 issued by Companies (Accounting Standards) Rules, 2006 (amended).

Note 1.6: Previous year''s figures have been regrouped and rearranged wherever necessary to make them comparable with the current year figures.


Mar 31, 2013

Rs. in lakhs Particulars This Year Previous Year

Note 1.1: Contingent Liabilities and Commitments: (i) Contingent Liabilities

(a) Claims against the company not acknowledged as debt 12.00 12.00

(b) Amounts shown by HPCL as dues as per their statements of account contested by the Company 52.91

(c) Outstanding Guarantees to Banks including Letters of Credit opened with Banks for supplier 10.00 34.81 payments

(d) Various Claims made by EPDC of A.P.Ltd., which are contested by Company

i) Grid Support charges 115.97 115.97

ii) Electricity duty demand on captive power generation 115.48 113.20

iii) Disputed demand charges against APGPCL 10.47 10.47 Demand allocation

iv) Fuel Surcharge Adjustment charges 78.94

v) Demand against excess incentive recovery 13.19 13.19

vi) Disputed Income Tax demand for the Asst. Year 2010-11 24.71

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for 1.96

(b) Bills discounted 2346.40 1038.28

Note 1.2: Employee benefit plans:

As per Accounting Standard-15 "Employees Benefits" the disclosure of Employee Benefits as defined in the Account- ing Standard are given hereunder: Defined Contributions Plans: Contributions to Defined Contribution Plans, recognised as expense for the year, are as under:

Defined Benefit Plans:

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 compensated absences is recognised in the same manner as Gratuity.

I. Reconciliation of opening and closing balances of Defined Benefit obligations

Note 1.3: According to an internal technical assessment carried out by the Company, there is no impairment in the carrying cost of cash generating units of the Company in terms of Accounting Standard – 28 (AS – 28), issued by Companies (Accounting Standards) Rules, 2006 (amended).

Note 1.4: Previous year''s figures have been regrouped and rearranged wherever necessary to make them comparable with the current year figures.


Mar 31, 2012

Note 1.1: Contingent Liabilities and Commitments:

(i) Contingent Liabilities

(a) Claims against the Company not acknowledged as debt 12.00 12.00

(b) Outstanding Guarantees to Banks including

Letter of Credit opened with Banks for supplier payments 34.81 --

(c) Various claims made by EPDC of A.PLtd. which are contested by Company:

i) Grid Support charges 115.97 115.97

ii) Electricity duty demand on captive power generation 113.20 110.00

iii) Disputed demand charges against APGPCL demand allocation 10.47 7.78

iv) Fuel Surcharge adjustment charges 78.94 78.94

v) Demand against excess incentive recovery 13.19 --

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for -- 4.78

(b) Bills discounted 1038.28 --

1.2: Employee benefit plans:

As per Accounting Standard-15 "Employees Benefits" the disclosure of Employee Benefits as defined in the Accounting Standard are given hereunder:

Defined Contributions Plans:

Contributions to Defined Contribution Plans, recognised as expense for the year, are as under:

Defined Benefit Plans:

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 compensated absences is recognised in the same manner as Gratuity.

I. Reconciliation of opening and closing balances of Defined Benefit obligations

As per the enterprise's accounting policy actuarial gains and losses are recognised immediately during the same year itself. The above information is certified by Actuary.

1.3: Segment information:

The Company operates only in one business segment being the manufacture of Oxo-Alcohols and there are no geographical segments to be reported.

1.4: Related Party disclosures

Details of Related Party transactions as per AS-18 issued by Companies (Accounting Standards) Rules, 2006 (amended): I. List of related parties:

A. Investing party in respect of which The Andhra Petrochemicals Ltd., is an associate:

The Andhra Sugars Limited

B. Key Management Personnel:

Dr.Mullapudi Harischandra Prasad, Managing Director (upto 3.9.2011)

Dr.B B Ramaiah, Managing Director (from 12.11.2011)

C. Enterprises on which Key Management Personnel exercise significant influence (upto 3.9.2011):

1. Sree Akkamamba Textiles Ltd.

2. The Andhra Farm Chemicals Corporation Ltd.

3. Royal Printing Works (upto 3.9.2011)

1.5: According to an internal technical assessment carried out by the Company, there is no impairment in the carrying cost of cash generating units of the Company in terms of Accounting Standard - 28 (AS - 28), issued by Companies (Accounting Standards) Rules, 2006 (amended).

1.6: Previous year's figures have been regrouped and rearranged wherever necessary to make them comparable with the current year figures.

 
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