Notes to Accounts of Beardsell Ltd.

Mar 31, 2018

1. Corporate information

Beardsell Limited ("the Company") is a prominent manufacturer and supplier of Expanded Polystyrene products, popularly known as thermocole and Prefabricated Buildings that have wide industrial applications. The company also undertakes erection, commissioning and maintenance works in the field of hot and cold insulation solutions. The company has major manufacturing facilities in Thane, Chennai, Hyderabad and Karad and branches with geographical spread across India. In addition, the company has trading operations in domestic and international market.

These financial statements were authorised for issue in accordance with a resolution of the directors on May 28, 2018.

(a) Charge on assets

The Rupee term loans from Bank of India are secured by equitable mortgage over the land and buildings there on at Karad (4.10 acres), Coimbatore (3.50 acres), Bonthapally (1.40 acres), Chennai -Thiruvallur (6.98 acres), Bihar (3.93 acres), Dahej (2.50 acres) and Thane (1.85 acres). The Company has deposited the original title deeds of all the above mentioned properties with the Bank. In addition to the above the Company has also hypothecated its stocks and book debts.

(b) Hire purchase arrangements

The carrying value of vehicles held under hire purchase contracts at March 31, 2018 was Rs. 189.81 lakhs (March 31, 2017: Rs. 261.47 lakhs and April 01, 2016: Rs. 154.24 lakhs). Additions during the year include Rs.23.95 lakhs (March 31, 2017: Rs. 147.18 lakhs) of vehicles under hire purchase contracts. Assets under hire purchase contracts are pledged as security for the related hire purchase liabilities.

2. Terms / rights attached to shares

The Company has issued only one class of equity shares having a par value of Rs.2/- per share. Each holder of equity share is entitled to one vote per share. The Company declares dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive 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.

As per records of the company, including its register of shareholders / members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

3. Aggregate number of bonus shares, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceeding the reporting date

(a) On May 05, 2017, one equity share of face value Rs. 10/- each was split into five equity shares of Rs. 2/- each. Accordingly, 10,000,000 authorised equity shares of Rs. 10/- each were sub-divided into 5,00,00,000 authorised equity shares of Rs.2/- each and 4,683,168 fully paid up shares of Rs.10/- each were sub-divided into 23,415,840 fully paid up shares of Rs.2/- each.

(b) On May 06, 2017, the Company issued bonus shares to the existing shareholders, in the ratio of 1:5. The Securities premium account was utilised to the extent of Rs. 93.66 lakhs for the issue of said bonus shares.

(i) The Rupee term loans from Bank of India are secured by exclusive charge on the entire fixed and current assets of the Company. They are also secured by deposit of the title deeds of all its properties. These term loans are repayable over a period of 7 years and the average floating interest rate is 10.50% (previous year - 11.00%)

(ii) Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan and taken at an interest rate of 9.50% to 10.50%.

(iii) Public deposits are accepted at an interest rate of 9.75% to 10.59%

(iv) Inter corporate deposits are accepted at an interest rate of 11.00% to 13.00%

(v) Loans and advances from related parties are at an interest rate of 12.00%

# Sale of finished goods includes excise duty collected from customers of Rs 286.42 lakhs (March 31, 2017: Rs.1,145.73 lakhs). Sale of goods net of excise duty is Rs 12,336.28 lakhs (March 31, 2017: Rs. 14,068.34 lakhs). Revenue from operations for periods up to June 30, 2017 includes excise duty. From July 01, 2017 onwards the excise duty and most indirect taxes in India have been replaced withGoods and Service Tax (GST). The Company collects GST on behalf of the Government. Hence, GST is not included in Revenue from operations. In view of the aforesaid change in indirect taxes, Revenue from operations year ended March 31, 2018 is not comparable March 31, 2017.

4. Exceptional items

On November 29, 2017, the Company has transferred leasehold rights on land situated at Plot No. N-32 located at Additional Patalganga Industrial Area, Taluka - Panvel, Maharashtra along with the sale of factory building constructed by the Company on the leasehold land for an aggregate consideration of Rs. 800 lakhs to V-ensure Pharma Technologies Private Limited. Rs.244.75 lakhs being gain on disposal during this year ended March 31, 2018 is shown as an exceptional item.

5. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares.

EPS has been restated for the comparative period giving effect to the revised number of shares post stock split of one share having a face value of Rs.10/- into five shares of Rs.2/- each and bonus issue of one share for every five shares as metioned in note 17.5 (a) and (b).

6. Employee benefits

A. Defined contribution plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs.86.44 Lakhs (March 31, 2017: Rs.73.56 Lakhs) for Provident Fund contributions, Rs.73.56 Lakhs (March 31, 2017: Rs.59.91 Lakhs) for Superannuation Fund contributions and Rs.6.30 Lakhs (March 31, 2017: Rs.4.39 Lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

B. Defined benefit plans

Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service subject to a maximum of Rs. 20 Lakhs. The Company has invested the plan assets with the insurer managed funds (Life Insurance Corporation). The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares, Mutual Funds, Money Market Instruments and Time Deposits. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation.

7. Segment information Primary segment

Based on internal reporting provided to the chief operating decision maker, insulation and trading are two reportable segments for the Company. Insulation Business includes manufacturing of EPS Products/ prefabricated panels and related service activities. Trading includes motors, export of fabrics, telemedicine equipments, Information Technology Products etc. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments. Segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. All expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable.

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2018, the Company has not recorded any impairment of receivables relating to amounts owed by related parties.

8. Commitments and contingencies

a. Leases

Operating lease commitments - Company as lessee

The Company has entered into operating lease arrangements for certain office premises. The leases are non-cancellable and are for a period of 5 years. The lease agreements provide for an increase in the lease payments by 6 to 7 % every year.

The Company has paid Rs.172.61 lakhs (March 31, 2017: Rs. 108.47 lakhs) during the year towards minimum lease payment.

Operating lease commitments - Company as lessor

The Company has entered into operating leases on its investment property portfolio consisting of certain land, buildings and plant & equipment. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. The lessee has the option to either renew the lease for a further period as may be decided upon by mutual consent or vacate the premises. The total rents recognised as income during the year is Rs.46.60 lakhs (March 31, 2017: Rs.43.91 lakhs).

9. Significant accounting judgements, estimates and assumptions

The preparation of financial statements in conformity with the recognition and measurement principles of Ind AS requires management to make judgements, estimates and assumptions that affect the reported balances of revenues, expenses, assets and liabilities and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

a) Judgements

In the process of applying the accounting policies, management has made judgement relating to determination of lease classification which has the most significant effect on the amounts recognised in the financial statements.

Operating leases - Company as lessor

The Company has entered into leases on its investment properties. The Company has determined, based on an evaluation of the terms and conditions of the arrangements such as the lease term not constituting a substantial portion of the economic life of the property, that it retains all the significant risks and rewards of ownership of these properties and so accounts for the contracts as operating leases.

b) Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of such obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates and attrition rate. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

10. Financial risk management objectives and policies

The Company''s principal financial liabilities comprise of bank and other borrowings, deposits, trade and other payables. The main purpose of these financial liabilities is to finance and support the entity''s operations. The entity''s principal financial assets include trade and other receivables and cash and cash equivalents that derive directly from its operations.

The entity is exposed to market risk, credit risk and liquidity risk. The entity''s senior management oversees the management of these risks. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, FVTOCI investments and derivative financial instruments.

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. The entity''s exposure to the risk of changes in market interest rates relates primarily to the entity''s long-term debt obligations with floating interest rates. The entity manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the entity''s profit before tax is affected through the impact on floating rate borrowings, as follows

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency). The Company has not hedged any portion of its expected foreign currency sales as at March 31, 2018, March 31, 2017 and April 01, 2016.

Foreign currency sensitivity

The following demonstrates the sensitivity to a reasonably possible change in the foreign currency exchange rates for INR, with all other variables held constant. The impact on the Company''s profit before tax is du e to changes in t he fair value of monetary assets and liabilities including non-designated foreign currency derivatives an d embedded derivatives. The sensitivity analysis includes only outstanding unhedged foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates.

In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

Credit risk

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The maximum exposure to the credit risk is equal to the carrying amount of financial assets as of March 31, 2018, March 31, 2017 and April 01, 2016 respectively.

Liquidity Risk

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank deposits and loans.

The table below summarises the maturity profile of the Company''s financial liabilities based on contractual undiscounted payments (including interest payments)

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 inputs are inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 inputs are unobservable inputs for the asset or liability.

There have been no transfers between the levels during the period.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk.

The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate.

They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

11. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity holders. The primary objective of the Company''s capital management is to maximise the shareholder value.

The Company''s capital management is intended to create value for shareholders by facilitating the meeting of long-term and short-term goals of the Company. The Company determines the amount of capital required on the basis of annual operating plans and long-term product and other strategic investment plans. The funding requirements are met through internal accruals, external commercial borrowings and other long-term/short-term borrowings. The Company''s policy is aimed at combination of short-term and long-term borrowings. The Company monitors capital employed using a Debt equity ratio, which is total debt divided by total equity and maturity profile of the overall debt portfolio of the Company. The Company includes within net debt, borrowings including interest accrued on borrowings less cash and short-term deposits.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current year.

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2017 and March 31, 2018.

12. First-time adoption of Ind AS

These financial statements, for the year ended March 31, 2018, are the first time the Company has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP), as amended.

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on March 31, 2018, together with the comparative period data as at and for the year ended March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at April 01, 2016, the Company''s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 01, 2016 and the financial statements as at and for the year ended March 31, 2017.

Exemptions applied

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

(a) Deemed cost for property, plant and equipment and investment property

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 recognised 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 after making necessary adjustments for de-commissioning liabilities subject to that there is no change in functional currency. This exemption can also be used for investment property covered by Ind AS 40 Investment Properties. Accordingly, the Company has elected to measure all of its property, plant and equipment and investment property at their previous GAAP carrying value.

(b) Business combination

Ind AS 101 permits first time adopter to choose the exemption of not restating business combinations occurred prior to the date of transition. If the exemption is chosen, the carrying amount of assets and liabilities under IGAAP shall be the carrying amount in the opening Ind AS Balance Sheet subject to the permissible adjustments specified under the standard. The Company availed the exemption provided under Ind AS 101 as explained above and did not restate any of the amount of assets and liabilities.

(c) Investments in subsidiary and jointly controlled entity

In the preparation of separate financial statements, Ind AS 27 Separate Financial Statements requires an entity to account for its investments in subsidiaries, jointly controlled entities and associates either at cost or in accordance with Ind AS 109. If a first-time adopter measures such an investment at cost, it can measure that investment at one of the following amounts in its separate opening Ind AS balance sheet:

- Cost determined in accordance with Ind AS 27

- Deemed cost, defined as

- Fair value determined in accordance with Ind AS 113 at the date of transition to Ind AS, or

- Previous GAAP carrying amount at the transition date.

A first-time adopter may choose to use either of these bases to measure investment in each subsidiary, joint venture or associate where it elects to use a deemed cost. Accordingly, the Company has opted to carry the investment in subsidiary and jointly controlled entity at the Previous GAAP carrying amount at the transition date.

Mandatory exceptions

a) Estimates

The estimates at April 01, 2016 and at March 31, 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

- Impairment of financial assets based on expected credit loss model

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 01, 2016, the date of transition to Ind AS and as of March 31, 2017 and March 31, 2018.

(b) Classification and measurement of financial assets

The Company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind-AS.

(c) Impairment of financial assets

At the date of transition to Ind AS, the Company has determined that assessing whether there has been a significant increase in credit risk since the initial recognition of a financial instrument would require undue cost or effort, hence the Company has recognised a loss allowance at an amount equal to lifetime expected credit losses at each reporting date until that financial instrument is derecognised (unless that financial instrument is low credit risk at a reporting date).

13 (a) Footnotes for reconciliation of balance sheet and profit & loss statement as previously reported under IGAAP to Ind AS

1 Reclassification

Previous periods'' figures have been re-grouped / re-classified, where necessary to comply with Ind AS accounting.

The Company determines classification of certain assets and liabilities as financial/ non financial assets and liabilities. Transitional adjustments made by Company represents reclassification of non financial assets and liabilities to other assets and liabilities

2 Deferred tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP.

In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the company has to account for such differences.

3 Excise duty on sale of goods

Under Indian GAAP, sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty. Excise duty on sale of goods is included as part of sales in the face of statement of profit and loss. Thus sale of goods under Ind AS for the year ended March 31, 2017 has increased by Rs.1,145.73 lakhs with a corresponding increase in expenses.

4 Defined benefit liabilities

Both under Indian GAAP and Ind AS, the Company recognised costs related to its post-employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are charged to the statement of profit and loss. Under Ind AS, remeasurements (comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts included in net interest on the net defined benefit liability) are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI.

5 Lease equilisation

Under the previous GAAP, leases need to be straight-lined over the period of non-cancellable term. As per Ind AS 17, lease payments under an operating lease shall be recognised as an expense on a straight-line basis over the lease term unless either another systematic basis is more representative of the time pattern of the user''s benefit even if the payments to the lessors are not on that basis or the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases. Since the payments to the lessor does not vary because of any factors other than general inflation, the Company has reversed the expense recognised on a straight-line basis.

6 Fair valuation of investments

Under Indian GAAP, the Company accounted for long term investments in unquoted and quoted equity shares as investment measured at cost less provision for other than temporary diminution in the value of investments. Under Ind AS, the Company has designated such investments as FVTOCI investments. Ind AS requires FVTOCI investments to be measured at fair value. At the date of transition to Ind AS, difference between the instruments fair value and Indian GAAP carrying amount has been recognised as a separate component of equity, in the FVTOCI reserve, net of related deferred taxes.

7 Other comprehensive income

Under Indian GAAP, the Company has not presented other comprehensive income (OCI) separately. Hence, it has reconciled Indian GAAP profit or loss to profit or loss as per Ind AS. Further, Indian GAAP profit or loss is reconciled to total comprehensive income as per Ind AS.

8 Statement of cash flows

The transition from Indian GAAP to Ind AS has not had a material impact on the statement of cash flows.

14. Standards issued but not yet effective

The standard issued, but not yet effective up to the date of issuance of the Company''s financial statements is disclosed below.

Ind AS 115 Revenue from Contracts with Customers

Ind AS 115 was notified on March 28, 2018 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

The new revenue standard will supersede all current revenue recognition requirements under Ind AS. This new standard requires revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the Company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions of the Company. Ind AS 115 is effective for the Company in the first quarter of fiscal 2019 using either one of two methods: (i) retrospectively to each prior reporting period presented in accordance with Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors, with the option to elect certain practical expedients as defined within Ind AS 115 (the full retrospective method); or (ii) retrospectively with the cumulative effect of initially applying Ind AS 115 recognized at the date of initial application (April 01, 2018) and providing certain additional disclosures as defined in Ind AS 115 (the modified retrospective method).

The Company continues to evaluate the available transition methods and its contractual arrangements. The ultimate impact on revenue resulting from the application of Ind AS 115 will be subject to assessments that are dependent on many variables, including, but not limited to, the terms of the contractual arrangements and the mix of business. The Company''s considerations also include, but are not limited to, the comparability of its financial statements and the comparability within its industry from application of the new standard to its contractual arrangements. The Company has established an implementation team to implement Ind AS 115 related to the recognition of revenue from contracts with customers and it continues to evaluate the changes to accounting system and processes, and additional disclosure requirements that may be necessary. A reliable estimate of the quantitative impact of Ind AS 115 on the financial statements will only be possible once the implementation project has been completed.

Amendments to Ind AS 12 - Recognition of Deferred Tax Assets for Unrealised Losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognised in opening retained earnings (or in another component of equity, as appropriate), without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that fact.

These amendments are effective for annual periods beginning on or after April 01, 2018. These amendments are not expected to have any impact on the Company.

Amendments to Ind AS 40 - Transfers of Investment Properly

The amendments clarify when an entity should transfer property, including property under construction or development into, or out of investment property. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property and there is evidence of the change in use. A mere change in management''s intentions for the use of a property does not provide evidence of a change in use.

Entities should apply the amendments prospectively to changes in use that occur on or after the beginning of the annual reporting period in which the entity first applies the amendments. An entity should reassess the classification of property held at that date and, if applicable, reclassify property to reflect the conditions that exist at that date. Retrospective application in accordance with Ind AS 8 is only permitted if it is possible without the use of hindsight.

The amendments are effective for annual periods beginning on or after April 01,2018. The Company will apply amendments when they become effective. However, since Company''s current practice is in line with the clarifications issued, the Company does not expect any effect on its financial statements.

15. Prior year comparatives

The figures of previous year have been regrouped/reclassified, where necessary, to conform to this year''s classification.

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Mar 31, 2016

Employee Benefits

1. Defined Contribution Plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs.66.15 Lakhs (Year ended 31 March, 201 5 Rs.56.69 Lakhs) for Provident Fund contributions, Rs.55.66 Lakhs (Year ended 31 March, 201 5 Rs.47.93 Lakhs) for Superannuation Fund contributions and Rs.3.1 7 Lakhs (Year ended 31 March, 201 5 Rs.3.1 9 Lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

2. Defined benefit plans Gratuity

The following table sets forth the status of Gratuity Plan of the Company and the amount recognized in the Balance Sheet and Statement of Profit and Loss.

3 Estimate of amount of contribution in the immediate next year: Rs.55.00 Lakhs (RY.- Rs.28.00 Lakhs)

4 The Company has invested the plan assets with the insurer managed funds. The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares, Mutual Funds, Money Market Instruments and Time Deposits. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. The details of experience adjustments arising on account of plan assets and liabilities as required by paragraph 1 20(n)(ii) of AS 1 5 (Revised) on "Employee Benefits" are not readily available in the valuation report and hence, are not furnished.

5 As the fair value of the planned assets is more than the liability, an amount of Rs. 1 3.27 Lakhs (RY.- Rs. 1 7.29 Lakhs) has not been recognized in the books on a conservative basis.

6 Segment Information (a) Primary Segment

The Company has identified business segments as its primary segment. Business segments are primarily insulation and trading. Insulation Business includes manufacturing of EPS Products/ prefabricated panels and related service activities. Trading includes motors, export of fabrics, telemedicine equipments, Information Technology Products etc. The above segments have been identified taking into account the organization structure as well as differing risks and returns of these

7 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification/ disclosure.

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Mar 31, 2015

1. Terms attached to equity shares

The Company has issued only one class of equity shares having a par value of Rs.10/- per share. Each holder of equity share is entitled to one vote per share. The Company declares dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting. Repayment of capital will be in proportion to the number of equity shares held.

2. The Rupee term loan from Bank of India are secured by exclusive charge on the entire fixed and current assets of the Company. They are also secured by deposit of the Title Deeds of all its properties except at Thane and Bihar. These term loans are repayable over a period of six years and the floating interest rate is 13.1 0% (P.Y. 11.50% to 12.00%)

3. For current maturities of long term borrowings, refer Item (a) in Note 9- Other Current Liabilities.

4. Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan and are payable over a period of two to four years. For current maturities of hire purchase loans, refer item (b) in Note 9- Other Current Liabilities.

5. The Company has not defaulted in repayment of the loans, public deposits and interest thereon.

6. Working capital facilities from Bank of India are secured by exclusive charge on the entire fixed and current assets of the Company. They are also secured by deposit of the Title Deeds of all its properties except at Thane and Bihar.

7. The company has not defaulted in repayment of the loans, public deposits and interest thereon.

8. Current maturities of long-term debt pertains to secured term loans taken from banks. Refer Note 4.1 under Long-term borrowings for details of security and terms of repayment.

9. Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan.

10. These amounts represent dividend warrants issued to the Shareholders which remained unpresented as on 31st March 2015. There are no amounts due to be transferred to Investor Education and Protection Fund as on 31st March 2015 (P.Y.: Rs. Nil).

11. Of the above, the balances that meet the definition of Cash and cash equivalents as per AS 3 Cash Flow Statements is Rs.269.68 Lakhs (Rs. 440.21 Lakhs)

12. Balances with banks - Other earmarked accounts represent fixed deposits made in pursuance of Rule 3A of the Companies (Acceptance of Deposits) Rules 1975.

13. Contigent Liabilities and Commitments (to the extent not provided for)

As at As at Particulars March 31, 2015 March 31, 2014

(Rs. in Lakhs)

(i) Contingent Liabilities

(a) Claims against the Company not acknowledged as debts 22.77 22.77

(b) Sales tax demands against which the Company has filed appeals and for which no provision is considered necessary as the 608.47 465.93 Company is hopeful of successful outcome in the appeals.

(c) CST demands in respect of which the High Court has pronounced an - 162.13 order quashing the proceedings and redirected the proceedings to the Assessing Officer, as confirmed by the legal counsel.

631.24 650.83

Future cash outflows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums / authorities. Nature Amount Payment Period to Name of the statute of dues made which the amount relates Rs. in Lakhs

Sales Tax Acts Sales Tax 45.09 9.67 1995-96 of various states -Local (40.50) (6.07) 2000-01

2001-02

2003-04

2005-06

2006-07

2007-08

2008-09

2009-10 2010-11

Central Sales Sales Tax 563.38 45.65 1995-96 Tax Act, 1956 -CST (587.56) (27.65) 2000-01

2001-02

2003-04

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

608.47 55.32

(628.06) (33.72)

Forum where Name of the statute dispute is pending

Sales Tax Acts Deputy of various states Commissioner, Assistant Commissioner & other appellate authorities

Central Sales High Court, Tax Act, 1956 Deputy Commissioner & CTO of various states

Note: Figures in bracket relates to the previous year

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed and not 189.48 127.72 provided for in these accounts (net of advances) in respect of purchase of tangible assets.

(b) Commitments towards investments - 48.11

14. Memorandum of Understanding

During the year, the Company has entered into Memorandum of Understanding ("MOU") with an entity effective 01.09.2014 to operate its EPS division. In accordance with the terms of the MOU, the Company has to absorb 50% of the interest costs and share of profits/ losses of this division. Accordingly the Company has absorbed finance costs of this division amounting to Rs.19.62 lakhs and share of losses amounting to Rs.16.16 lakhs.

15. Employee Benefits

A. Defined Contribution Plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs.56.69 Lakhs (Year ended 31 March, 2014 Rs.48.39 Lakhs) for Provident Fund contributions, Rs.47.93 Lakhs (Year ended 31 March, 2014 Rs.40.50 Lakhs) for Superannuation Fund contributions and Rs.3.19 Lakhs (Year ended 31 March, 2014 Rs.3.55 Lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

16. Estimate of amount of contribution in the immediate next year: Rs.28.00 Lakhs (P.Y.- Rs.25 Lakhs)

17. The Company has invested the plan assets with the insurer managed funds. The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares, Mutual Funds, Money Market Instruments and Time Deposits. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. The details of experience adjustments arising on account of plan assets and liabilities as required by paragraph 120(n)(ii) of AS 15 (Revised) on "Employee Benefits" are not readily available in the valuation report and hence, are not furnished.

18. As the fair value of the planned assets is more than the liability, an amount of Rs. 17.29 Lakhs (P.Y.- Rs.2.80 Lakhs) has not been recognised in the books on a conservative basis.

19. Segment Information

(a) Primary Segment

The Company has identified business segments as its primary segment. Business segments are primarily insulation and trading. Insulation Business includes manufacturing of EPS Products/ prefabricated panels and related service activities. Trading includes motors, export of fabrics, telemedicine equipments, Information Technology Products etc. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. The geographical segments of the Company are India and others.

20. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification/disclosure.

---

Mar 31, 2014

Corporate Information

Beardsell Limited ("the Company") is a prominent manufacturer and supplier of Expanded Polystyrene products, popularly known as thermocole and Prefabricated Buildings that have wide industrial applications. The company also undertakes erection, commissioning and maintenance works in the field of hot and cold insulation solutions. The company has manufacturing facilities in Thane, Chennai, Hyderabad and Karad and branches with geographical spread across India. In addition, the company has trading operations in domestic and international market.

1. Terms attached to equity shares

The Company has issued only one class of equity shares having a par value of Rs.l 0/- per share. Each holder of equity share is entitled to one vote per share. The Company declares dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting. Repayment of capital will be in proportion to the number of equity shares held.

2. The Rupee term loan from Bank of India are secured by exclusive charge on the entire fixed and current assets of the Company. They are also secured by deposit of the Title Deeds of all its properties except at Thane. These term loans are repayable over a period of six years and the floating interest rate range from 11.50% to 12.00% (RY. 12.75% to 14.25%)

3. The Company has not defaulted in repayment of the loans, public deposits and interest thereon.

4. For current maturities of long term borrowings, refer Item (a) in Note 9- Other Current Liabilities.

5. Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan and are payable over a period of two to four years. For current maturities of hire purchase loans, refer item (b) in Note 9- Other Current Liabilities.

6. Working capital facilities from Bank of India are secured by exclusive charge on the entire fixed and current assets of the Company. They are also secured by deposit of the Title Deeds of all its properties except at Thane.

7. The company has not defaulted in repayment of the loans, public deposits and interest thereon.

8. In accordance with the Notification No.GSR71 9 (E) dated 16.11.2007 issued by the Ministry of Corporate Affairs, certain disclosures are required to be made relating to Micro and Small Enterprises as defined underthe Micro,Small and Medium Enterprises Development Act, 2006. Since there are no dues to such enterprises, no disclosures are required to be made underthe said Act.

9. Current maturities of long-term debt pertains to secured term loans taken from banks. Refer Note 4.1 under Long-term borrowings for details of security and terms of repayment.

10. Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan.

11. These amounts represent dividend warrants issued to the Shareholders which remained unpresented as on 31 st March 2014. There are no amounts due to be credited to Investor Education and Protection Fund as on 31 st March 2014 (RY.: Rs. Nil).

12. Represents vehicle loans given to employees secured by respective vehicles.

13. Represents amounts paid to Saideep Polytherm, a Partnership firm. A Memorandum of understanding has been executed with the firm on May 7, 2014 for the Company to become a partner in the firm for a total capital contribution of Rs. 112.15 lakhs.

14. Of the above, the balances that meet the definition of Cash and cash equivalents as per AS 3 Cash Flow Statements is Rs.440.21 Lakhs (Rs. 218.11 Lakhs)

15. Balances with banks - Other earmarked accounts represents fixed deposits made in pursuance of Rule 3A of the Companies (Acceptance of Deposits) Rules 1975 .

16. Sales of services comprise of income from erection, commissioning and maintenance of hot and cold insulation solutions.

17. Others include raw materials such as Isocynate, chemicals and wire mesh, none of which individually accounts for more than 10% of the total consumption.

18. Other borrowing cost includes loan processing charges, guarantee charges, loan facilitation charges and other ancillary costs incurred in connection with borrowings.

19. Legal and Professional charges include an amount of Rs.6.00 lakhs (RY.: Rs.6.20 lakhs) paid to a law firm in which one of the directors is a partner.

20 Contigent Liabilities and Commitments (to the extent not provided for)

As at As at Particulars March 31, 2014 March 31,2013 (Rs. in Lakhs)

(i) Contingent Liabilities

(a) Claims against the Company not 22.77 22.77 acknowledged as debts

(b) Sales tax demands against which the Company has filed

appeals and for which no provision 465.93 31 6.85 is considered necessary as the Company is hopeful of successful outcome in the appeals.

(c)CST demands in respect of which the High Court has pronounced an order quashing the 162.13 - proceedings and redirected the proceedings to the Assessing Officer, as confirmed by the legal counsel. 628.06 316.85

Future cash outflows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums / authorities.

Payment Period to Name of the statute nature Amount made which the ofdues Rs. in Lakhs amount relates

Sales Tax Acts Sales Tax 40.50 6.07 1995-96 of various states -Local (43.52) (3.70) 1998-99 2000-01 2001-02 2003-04 2005-06 2006-07 2008-09 2009-10

Central Sales Sales Tax 587.56 27.65 1995-96 Tax Act, 1956 -CST (273.33) (12.65) 2000-01 2001-02 2003-04 2005-06 2006-07 2008-09 2009-10 2010-11 628.06 33.72 2011-12 (316.85) (16.35)

Forum where Name of the statute dispute is pending

Sales Tax Acts Deputy of various states Commissioner, Assistant Commissioner & other appellate authorities

Central Sales High Court, Tax Act, 1956 Deputy Commissioner & CTO of various states

Note: Figures in bracket relates to the previous year

(ii) Commitments

(a) Estimated amount of contracts remaining 127.72 62.1 8 to be executed and not provided for in these accounts (net of advances)

in respect of purchase of tangible assets.

(b) Letters of Credit established for - 268.94 purchases of raw materials

(c) Commitments towards investments 48.11 - (Refer Note 13.2)

21 Employee Benefits

A. Defined Contribution Plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs.48.39 Lakhs (Year ended 31 March, 2013 Rs.49.43 Lakhs) for Provident Fund contributions, Rs.40.50 Lakhs (Year ended 31 March, 2013 Rs.36.95 Lakhs) for Superannuation Fund contributions and Rs.3.55 Lakhs (Year ended 31 March, 2013 Rs.3.74 Lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

22. Estimate of amount of contribution in the immediate next year: Rs. 25.00 Lakhs (RY.-Nil)

23. The Company has invested the plan assets with the insurer managed funds. The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares, Mutual Funds, Money Market Instruments and Time Deposits. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. The details of experience adjustments arising on account of plan assets and liabilities as required by paragraph 1 20(n)(ii) of AS 15 (Revised) on "Employee Benefits" are not readily available in the valuation report and hence, are not furnished.

24. As the fair value of the planned assets is more than the liability, an amount of Rs. 2.80 Lakhs (RY. - Rs.50.73 Lakhs) has not been recognised in the books on a conservative basis.

25 Segment Information

(a) Primary Segment

The Company has identified business segments as its primary segment. Business segments are primarily insulation and trading, insulation Business includes manufacturing of EPS products / Pre-tabricated panels and related service activities. Trading includes motors, export of fabrics, tele-medicine equipments, Information Technology products etc. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments. Revenues and expenses directly attributable to segments are reported under each reportable segments. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to the segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. The geographical segments of the Company are India and others.

26 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

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Mar 31, 2013

Corporate Information

Beardsell Limited ("the Company") is a prominent manufacturer and supplier of Expanded Polystyrene products, popularly known as thermocole and Prefabricated Buildings that have wide industrial applications. The company also undertakes erection, commissioning and maintenance works in the field of hot and cold insulation solutions. The company has manufacturing facilities in Thane, Chennai, Hyderabad and Karad and branches with geographical spread across India. In addition, the company has trading operations in domestic and international market.

1.1 Current maturities of long-term debt pertains to secured term loan taken from IDBI Bank Limited. Refer Note 4.1 under Long-term borrowings for details of security and terms of repayment.

1.2 Hire purchase loans are secured by hypothecation of vehicles acquired out of the loan.

1.3 These amounts represent dividend warrants issued to the Shareholders which remained unpresented as on 31st March, 201 3. There are no amounts due to be credited to Investor Education and Protection Fund as on 31 st March 201 3 (RY.: Rs. Nil).

2 Contigent Liabilities and Commitments (to the extent not provided for)

As at As at Particulars March 31, 2013 March 31, 2012 Rs. in Lakhs)

(i) Contingent Liabilities

(a) Claims against the Company not acknowledged as debts 22.77

(b) Sales tax, Income tax and demands against which the 316.85 217.90 Company has filed appeals and for which no provision is considered necessary as the Company is hopeful of successful outcome in the appeals.

Future cash outflows in respect of the above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities.

3 Employee Benefits

A. Defined Contribution Plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, forqualifying employees. Underthe Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs.49.43 Lakhs (Year ended 31 March, 201 2 Rs.46.49 Lakhs) for Provident Fund contributions, Rs.36.95 Lakhs (Year ended 31 March, 201 2 Rs.40.05 Lakhs) for Superannuation Fund contributions and Rs.3.74 Lakhs (Year ended 31 March, 201 2 Rs.3.24 Lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

4.1 Estimate of a mount of contribution in the immediate next year: Rs. Nil (RY- Rs. 23 Lakhs)

4.2 In the absence of detailed information regarding Plan assets which is funded with Life Insurance Corporation of India, the composition of each major category of plan assets, the percentage or amount for each category to the fair value of plan assets has not been disclosed.The details of experience adjustments arising on account of plan assets and liabilities as required by paragraphl 20(n)(ii) of AS 15 (Revised) on "Employee Benefits" are not readily available in the valuation report and hence, are notfurnished.

4.3 As the fair value of the planned assets is more than the liability, an amount of Rs. 50.73 Lakhs (RY- Rs.3.65 Lakhs) has not been recognised in the books on a conservative basis.

5 Segment Information

(a) Primary Segment

The Company has identified business segments as its primary segment. Business segments are primarily insulation and trading. Insulation Business includes manufacturing of EPS Products/ prefabricated panels and related service activities. Trading includes motors, export of fabrics, telemedicine equipments, Information Technology Products etc. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. The geographical segments of the Company are India and others.

6 Related party transactions (as identified by the management and relied upon by the auditors)

Details of related parties:

(a) Key Management Personnel (KMP) - Mr. BharatAnumolu -Managing Director

- Mr, S.V.Narasimha Rao - Executive Director

(b) Relatives of KMP - Mrs. A. Jayasree- Mother of Managing Director

- Mr. Amrith Anumolu - Brother of Managing Director

- Mr. S Arun (HUF) - HUF, wherein son of Executive Director is the Karta j

7 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

---

Mar 31, 2012

Corporate Information

Beardsell Limited ("the Company") is a prominent manufacturer and supplier of Expanded Polystyrene products, popularly known as thermocole and Prefabricated Buildings that have wide industrial applications. Company also undertakes erection, commissioning and maintenance works in the field of hot and cold insulation solutions. The company has own manufacturing facilities in Thane, Chennai and Hyderabad and branches with geographical spread across India. In addition, the company has operations of trading in Motors and Fabrics.

1.1 Terms attached to equity shares

The Company has issued only one class of equity shares having at par value of Rs.10/- per share. Each holder of Equity Share is entitled to one vote per share. The Company declares dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting. Repayment of capital on liquidation will be in proportion to the number of equity shares held.

1.2 On October 31, 2011, the Company has allotted 4,00,000 Equity Shares of face value of Rs.10/- each at a premium of Rs.48/- per share to promoters of the Company by conversion of 4,00,000 Fully Convertible Equity Warrants issued on October 27, 2010, vide the approval of members of the Company at the General Meeting held on September 27, 2010. On March 28, 201 2, the Company has further allotted 4,50,000 Equity Shares of face value of Rs. 10/- each at a premium of Rs. 48/- per share to the promoters of the company upon conversion of 4,50,000 Fully Convertible Equity Warrants issued on October 10, 2011, vide the approval of members of the Company at the General Meeting held on September 28, 2011. Consequent to these allotments the Paid-up Share Capital has increased from Rs. 383.32 Lakhs to Rs. 468.32 Lakhs. The premium on such allotments amounting to INR 408.00 Lakhs has been credited to securities premium account.

2.1 The Rupee term loan from IDBI is secured by first charge on the entire fixed assets of the Company excluding specific assets already charged with Bank of India on pari passu basis. They are also secured by deposit of the Title Deeds of one of its property. This term loan is repayable over a period of seven years and the interest rates range from 1 3% to 1 4.25%.

2.2 The company has not defaulted in repayment of the loans, public deposits and interest thereon.

2.3 For current maturities of long term borrowings, refer Item (a) in Note 9 - Other Current Liabilities.

3.1 Working capital facilities from Bank of India are secured by first charge on current assets and charge on specific Fixed Assets of the Company, on pari passu basis, with IDBI Bank Limited in respect of its term loan.

3.2 The company has not defaulted in repayment of the loans, public deposits and interest thereon.

4.1 In accordance with the Notification No.GSR719(E) dated 16.11.2007 issued by the Ministry of Corporate Affairs, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises Act as defined under the Micro, Small and Medium Enterprises Development Act, 2006. Since there are no dues to such enterprises, no disclosures are required to be made under the said Act.

5.1 Current maturities of long-term debt pertains to secured term loan taken from IDBI Bank Limited. Refer Note 4.1 under Long-term borrowings for details of security and terms of repayment.

7.1 Of the above, the balances that meet the definition of cash and cash equivalents as per AS 3 cash flow statements is Rs.208.56 Lakhs (PY. Rs. 243.52 Lakhs)

7.2 Balances with banks - Other earmarked accounts represents fixed deposits made in pursuance of Rule 3A of the Companies (Acceptance of Deposits) Rules, 1 975.

7.3 Balances with banks includes deposits amounting to Rs.10 Lakhs (PY. Rs. 25 Lakhs) which have a maturity of more than 12 months from the Balance Sheet date.

8.1 Sales of services comprise of income from erection, commissioning and maintenance of hot and cold insulation solutions.

9.1 Others include raw materials such as isocynate, chemicals and wire mesh, none of which individually accounts for more than 10% of the total consumption.

10.1 Legal and professional charges include -

(a) An amount of Rs. 2.15 Lakhs paid to a law firm in which one of the directors is a partner. This is subject to approval of share holders in the ensuing general meeting in accordance with provisions of Section 314 and other applicable provisions of the Companies Act, 1 956.

(b) An amount of Rs. 0.80 Lakhs incurred for a Director, in his capacity as a technical advisor. This is subject to the approval of shareholders in the ensuing general meeting in accordance with provisions of Section 314 and other applicable provisions of the Companies Act, 1 956.

11 Segment Information

(a) Primary Segment

The Company has identified business segments as its primary segment. Business segments are primarily insulation and trading. Insulation Business includes manufacturing of EPS Products/ Prefab panels and related service activities. Trading includes motors, exports etc. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments.

(b) Secondary segment

As the sales and assets outside India is less than 10% of total sales/ assets, there are no reportable geographical segments.

12 Related party transactions

Details of related parties:

(a) Key Management Personnel (KMP) - Mr. Bharat Anumolu - Managing Director

- Mr. S.V.Narasimha Rao - Executive Director

(b) Relatives of KMP - Mrs. A. Jayasree- Mother of Managing Director

- Mr. Amrith Anumolu - Brother of Managing Director

- Mr. S Arun (HUF) - HUF, wherein son of Executive Director is the Karta

13 Subsequentevents

On April 4, 2012 the promoters of the Company made an open offer for acquisition of 12,17,624 shares (representing 26% of the total paid up equity share capital) at Rs.58/- per share from public shareholders, in accordance with Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 201 1 and subsequent amendments thereto. The offer opened on June 7, 2012 and closed on June 20, 2012. Holders of 8,55,516 shares have accepted the offer, consequent to which the promoters' shareholding has increased from 57.64% to 75.91%. In order to comply with clause 40A of the Listing agreement, the promoters have sold 44,003 shares in the open market on July 26, 201 2 and July 27, 2012 to reduce their holdings to 74.96%.

14 The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

---

Mar 31, 2010

As on As on Mar 31,2010 Mar 31,2009

1.01 Contingent liabilities

(Rs. in Lakhs)

Uncalled Liability in respect of partly paid shares held as investments 0.36 0.36

Claims against the Company not acknowledged as debts 2.00 2.00

Capital Commitments (Net of Advances) 150.99 60.45

Disputed Sales Tax demands 14.04 16.89



Name of the Nature of . Amount Payment statute dues made

Sales tax acts of Sales Tax 6.44 3.85 various States

(9.29) (3.05)

Central Sales Sales Tax 7.60 2.65 Tax Act

(7.60) (2.65)

Name of the Period to which Forum where statute the amt. relates dispute is pending

Sales tax acts of 1982-83tol985-86 Deputy Commissioner various States 1989 - 90 to 1995-96 & Assistant Commissioner 1997-98 & other appellate 1998-99 authorities 2000 - 01 2001 - 02 2003 - 04

Central Sales 1993 - 94 to 1995-96 Deputy Commissioner Tax Act 1997-98 & CTO of various states 2000 - 01 2001 - 02 2003 - 04

1.02 Income tax appeal

An appeal is pending before CIT (Appeals) against the order of the Assessing Officer for the assessment year 2005 - 2006 in respect of disputed tax demand of Rs. 1 1 2.75 lakhs which includes interest of Rs. 20.03 lakhs. The entire amount has been paid. The Company is advised that there are reasonable chances of success in the appeal. Accordingly, no provision is considered necessary.

1.03 Excise duty

Excise duty on sales for the year has been disclosed as reduction from turnover. Excise duty related to the difference between the closing stock and opening stock has been included in Schedule 1 3 forming part of the accounts.

1.04 Working capital facilities

Working capital facilities of the Company are secured by first charge on current assets and charge on specific fixed assets of the Company, on pari passu basis, with IDBI Bank Ltd. in respect of its Term Loan.

1.05 Term loan

Term Loan from IDBI Bank Ltd. is secured by First charge on the entire fixed assets of the Company excluding specific assets already charged with Bank of India on pari passu basis. They are also secured by deposit of Title Deeds of one of its property.

1.06 Deposits from public

(a) Fixed deposits maturing within one year is Rs. 7.98 lakhs (Rs. 1 9.1 1 lakhs).

(b) Fixed deposits under cash and bank balances includes an amount of Rs. 3.00 lakhs (Rs. 3.00 lakhs) deposited in pursuance of Rule 3A of the Companies (Acceptance of Deposits) Rules, 1 975.

1.07 Micro Enterprises & Small Enterprises

In accordance with the Notification No: GSR 71 9 (E) dated 1 6.11.2007 issued by the Ministry of Corporate Affairs, certain disclosures are required to be made relating to micro, small and medium enterprises as defined under the Micro, Small and Medium Development Act, 2006. The Company is in the process of compiling relevant information from its suppliers about their coverage under this Act. Since the relevant information is not readily available, no disclosures have been made in these financial statements.

1.08 Contracts-in-progress

In respect of contracts-in-progress, as on March 31, 201 0, the aggregate cost incurred and the profit recognized is Rs. 225.35 lakhs (Rs. 96.48 lakhs) and Rs. 24.87 lakhs (Rs. 12.95 lakhs) respectively. Advance from contract customers amount to Rs. 1 22.90 lakhs (Rs. 70.39 lakhs). Contracts receivables amount-to Rs.282.30 lakhs (Rs.291.72 lakhs).

1.09 During the year, the Court convened Extra Ordinary General Meeting was held on 9th of September 2009 and the Shareholders have approved the Scheme of Merger of the wholly owned subsidiary Viraat Granites Private Limited with the Company. Necessary petitions have been filed with Honourable High Court of Madras for the sanction of said Scheme, which is pending.

1.10 Other Income includes

- Rs.230.00 Lakhs received on account of Surrender of Tenancy Rights in respect of a property situated at Hyderabad

- Rs.25.03 Lakhs received on account of settlement of Insurance claim relating to Stock made in earlier years and interest of Rsl 0.29 Lakhs forthe delay in settlement.

The Company has considered business segment as the Primary Segment for disclosure.

Insulation Business includes manufacturing of EPS Products/Prefab Panels and related contracting activities.

Trading includes Chemicals, Motors and Exports, etc.

The above Segments have been identified taking into account the organization structure as well as the differing risks and returns of these segments.

(b) Secondary segment

As the sales and assets outside India is less than 1 0% of total sales/assets, there are no reportable geographical segments.

15.14 Related Party Transactions (as identified by the management and relied upon by Auditors)

(a) Subsidiary Company - M/s. Viraat Granites Private Limited

(b) Key management personnel - Mr. Bharat Anumolu - Managing Director (From 29.06.2009)

Mr. S. V. Narasimha Rao - Executive Director (From 29.06.2009)

Mr. A. V Ramalinqan - Executive Director (Till 20.05.2009)

1.11 Prior period comparatives

Prior year figures have been reclassified / re-grouped wherever necessary to conform to the current years classification.

---

Mar 31, 2000

1. (a) No provision has been made in the accounts towards disputed Income Tax demands under appeal amounting to Rs.58.22 lakhs as the Company is advised that there are reasonable chances of success in the appeal. Hence, no provision is considered necessary as of date.

31 st March 2000 31 st March 1999 (Rs. in lakhs)

(b) Maximum liabilities under guarantees and indemnities given by the Company 40.00 40.00

(c) Contingent liability in respect of

i) Bills/Cheques discounted (since cleared in full) 11.51 12.23

ii) Other matters 32.00 32.00

iii) Suit filed in respect of property held under lease agreement amount not ascertainable.

iv) Uncalled liability in respect of partly paid 0.68 - shares held as investments.

(d) Claims against the company not acknowledged as debts in 74.71 74.21 respect of disputed sales tax demands of Rs.l 18.23 lakhs including Rs.43.52 lakhs stayed by courts. The company is advised that there are reasonable chances of successful outcome of appeals and no provision is considered necessary as of date.

(e) Estimated amount of contracts remaining to be executed on Capital Account and not provided for 11.53 4.25

(f) i) The Companys EPS Factory at Velappanchavadi, Chennai ceased to work due to labour unrest resulting in the termination of the employment of the workers in the factory with effect from 06.01.98. The conciliation proceedings are in progress. As the entry into the factory was prevented by the workers, the figures relating to value of assets and liabilities at the factory have been estimated based on the records and informations available after writing down appropriate amount for deterioration in quality of stocks and stores and these have been considered in the preparation of the accounts. However, no provision has been made in the accounts for liability, if any, arising out of termination of the employment of the workers as the amount is not ascertainable.

ii) Majority of the retrenched workers of EPS Thane factor/ have filed a case in the Labour Court against retrenchment which is pending. No provision has been made in the accounts towards liability if any, arising out of retrenchments as the amount is not ascertainable.

(g) No Provision has been made in the accounts towards gratuity liability of retrenched employees who have not accepted the settlement amounting to Rs.30.30 lakhs and this will be accounted on payment basis as and when claimed by the employees.

2. Pursuant to the Partnership Agreement entered into between the Company and Mettur Textiles Private Limited on Nth December 1 982, the Company brought into Common Stock of the partnership firm "Mettur Textiles" all assets and liabilities of its Textile and Thread Division with effect from 1 st January 1 983. Based on the Supplemental partnership Agreement entered into between the Company, Mettur Textiles Private Limited and Rukmini Investments Private Limited dated 3rd March 1983, Rukmini Investments Private Limited, became a Partner in the firm "Mettur Textiles" and the Company retired from the Partnership with effect from 28th February 1 983. The Profit/Loss of Mettur Textiles for the two months ended 28th February 1 983 has not yet been ascertained and hence not been dealt with in the accounts of the Company. A sum of Rs.56.88 lakhs is due from Mettur Textiles Private Limited and Rukmini Investments Private Limited after adjustment of the claims made by them. Suits have been filed for the recovery of the amount.

3. (a) Packing Credit and Cash Credit loans are secured by:

i) Hypothecation of stocks of Raw Materials, Work-in-Progress, Finished Goods, Stores and Spares, Trading Stocks and Book debts belonging to the Company.

ii) Second charge on all block assets to cover the entire working capital facilities of the Company.

(b) (i) Term Loans from Industrial Development Bank of India and Others are secured by hypothecation of machinery acquired from the loans.

(ii) Instalments falling due within one year Rs. 140.29 lakhs (1 999 : Rs. 1 71.78 lakhs).

(iii) Fixed Deposits maturing within one year is Rs. 117.22 lakhs. (1999 : Rs. 232.09 lakhs).

(c) Term Loans from Industrial Investment Bank of India Ltd., Industrial Development Bank of India are secured by First pari passu charge on the Fixed Assets of the Company excluding machinery bought out of loans from institutions and others. The Debentures issued in February 1991 have been fully redeemed during the year. Term Loans from Industrial Investment Bank of India Limited and Industrial Development Bank of India are guaranteed by two Directors.

4. Intercorporate Deposit for Rs.30.00 lakhs and Hire purchase instalments for Rs.3.41 lakhs have been guaranteed by Chairman and Managing Director.

5. In respect of long term Investments in Shin-Ho-Petro Chemical (I) Ltd., no provision is considered necessary for the diminution in the value as steps taken for the rejuvenation of the company have yielded results.

6. Pursuant to Note 1 (D) Excise Duty payable on finished goods held at the factories amounting to Rs.4.47 lakhs (1999 : Rs.6.27 lakhs) have been debited to expenditure and included in stock valuation. However, this accounting treatment has no impact on the loss for the year.

7. Letters have been sent to parties having debit/credit balances requesting them to confirm the balances due by/to them and replies have been received only from some of the parties.

8. Fixed deposits under cash and bank balances represent amount deposited in pursuance of Rule 3 A of the Companies (Acceptance of Deposits) Rules 1975.

9. Loans and advances include:

(i) Due by a Private Limited Company in which a Director of this Company is a Director / Member Rs.Ni! (1999 : Rs. 0.16 lakhs).

(ii) Due by an officer of the Company Rs.2.88 lakhs (1999 : Rs. 3.04 lakhs). Maximum amount due at any time during the year Rs.3.19 lakhs. (1999 : Rs. 3.10 lakhs)

10. Comparative figures for the previous year have been reclassified wherever necessary to conform to this years classification.