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Notes to Accounts of Birla Cotsyn (India) Ltd.

Mar 31, 2015

Note 1.

The Company has made provision of unrecoverable capital advances amounting to Rs.94,32,23,851/-given to various equipment suppliers and other parties mainly towards implementing Weaving Project. The amount represents balances outstanding for more than five years in respect of projects of the Company which have not taken off and have been dropped in view of the losses incurred by the Company. The equipment suppliers have forfeited the advances and the Company is pursuing with them for the recovery of the same. Pending such recovery, the Company has made a provision for the same in the books of accounts.

Note 2.

Dues from Subsidairy represents the loan given by the Company to it's wholly owned subsidiary Birla Cotsyn (India) Ltd FZE. in Dubai. The increase in Loan Account is on account of Foreign Exchange Fluctuation resulting from restatement of loan account at exchange rate prevailing as at 31st March, 2015. The same has been considered as good for recovery in view of the management.

Note 3.

The Company had given loan to one related party which has negative net-worth as on balance sheet date and the same has been considered as good for recovery in view of the management.

Note No.4.

The Government of India has approved import of Capital Equipment under the "Exports Promotion Capital Goods Scheme" at a concessional rate of custom duty. Under the Scheme the Company purchased Capital Goods at nominal duty for which the Company has an export obligation aggregating to Rs.130,96.40 lakh, to be fulfilled within eight years from the date of issuance of respective licenses, failing which the duty saved aggregating Rs.1637.05 Lakh, together with interest and penalties, if levied, may have to be paid. As at the year end the Company has fulfilled Export Obligation aggregating Rs.102,37.66 Lakh.

Note No.5.

EMPLOYEE BENEFITS DISCLOSURE AS PER AS-15 (REVISED) ISSUED UNDER ACCOUNTING STANDARD RULES 2006 (AS AMENDED).

a. Defined Contribution Plans:

During the period ended 31st March, 2015 the Company has recognised the contribution to Employees Provident Fund and Pension Fund aggregating Rs.39,55,708/- (Previous year Rs. 42,06,379/-) in the Profit & Loss Account.

b. Defined Benefit Plans:

I. Contribution to Gratuity.

Provision for Gratuity has been made on the basis of actuarial valuation as at the period ended 31st March, 2015 The Company has funding arrangement with LIC for Khamgaon, Dhule and Ghatanji units. For Head office, Synthetic and Malkapur units there are no such arrangement. The liability towards the employees is discharged in the year of retirement / cessation of employment. Details under the AS -15, are furnished below:

The Company has made provision of unrecoverable capital advances amounting to Rs.94,32,23,851/-given to various equipment suppliers and other parties mainly towards implementing Weaving Project. The amount represents balances outstanding for more than five years in respect of projects of the Company which have not taken off and have been dropped in view of the losses incurred by the Company. The equipment suppliers have forfeited the advances and the Company is pursuing with them for the recovery of the same. Pending such recovery, the Company has made a provision for the same in the books of accounts. Pre-operative expenses incurred for the project which were shown as Capital Work In Progress of Rs.4,62,00,730/- has been written-off as there are no assets against such expenses.

Note No.6.

Comparative figures for the previous year have been regrouped and / or rearranged wherever necessary.


Mar 31, 2014

1. corporate INFORMATION

Birla Cotsyn (India) Limited ("the Company") is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956 having its registered office at Dalamal House, first floor, Nariman Point, Mumbai 400 021.

The principal business of the Company is Cotton and Synthetic Yarn Manufacturing, Weaving of Grey Fabrics, Ginning & Pressing of Cotton Bales and Fabric Trading.

2.(a) Terms/ rights attached to the equity shares

The company has only one class of equity shares having a par value of Re.1/- per shares. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends (if any) in Indian rupees. The dividends (if any) 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 shareholders are entitled to receive remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholdings.

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 except for shares held by Bank of New York Mellon which are in the form of GDR.

(b) Details of shares issued for other than cash for the period of Five Years immediately preceeding the Balance Sheet date.

42,69,81,554 Equity Shares of Re.1/- each have been allotted on 4th October, 2010 as fully paid Bonus Shares by Capitalisation of Reserves & Securities Premium Account.

Note: 3 (a)

In respect of balance confirmation sought by the Company from various parties reflected under Inter corporate deposits and certain dues to related parties as on 31 March, 2014, no one has responded to the request of the Company and such balances are taken as appearing in books and the same are subject to confirmation and reconciliation. Consequential impact, if any, will be considered as and when determined. Further, few parties from whom the Company has taken Inter Corporate deposit have already filed winding up petition under section 433 & 434 of the Companies Act, 1956 against the Company for non-payment of dues. These matters are sub-judice and the impact, if any, of the outcome is unascertainable at this stage and same is provided as contingent liability note.

Note 4.a

In respect of balance confirmation sought by the company from various parties reflected under Capital Advances, no one has responded to the request of company and such balances are taken as appearing in books and the same are subject to confirmation and reconciliation, consequential impact if any, will be considered as and when determined.

Note 4.b

Dues from Subsidiary represents the loan given by the Company to it''s wholly owned subsidiary in Dubai. The same has been considered as good for recovery in view of the management.

Note 4.c

The Company had given loan to one related party which has negative net-worth as on balance sheet date and the same has been considered as good for recovery in view of the management.

Note No. 5

CONTINGENT LIABILITIES NOT PROVIDED FOR: Amount in Rs.

Sr. Particulars As at As at No. 31st March,2014 30th June,2013

a) Claims against Company not NIL 102,000 acknowledged as debt

b) Labour matter pending with 50,37,646 75,00,000 the court

c) Claims against cases filed by 1,13,55,086 13,49,68,435 Unsecured Lenders

Ultimate outflow for the matters referred to above depends on the settlement of these cases

Note No. 6

In the absence of necessary information relating to the suppliers registered as Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, the Company has not been able to identify such suppliers and disclose the information required under the said Act relating to them.

Note No. 7

The Government of India has approved import of Capital Equipment under the "Exports Promotion Capital Goods Scheme" at a concessional rate of custom duty. Under the Scheme the Company purchased Capital Goods at nominal duty for which the Company has an export obligation aggregating to Rs.130,96.40 lakh, to be fulfilled within eight years from the date of issuance of respective licenses, failing which the duty saved aggregating Rs.1637.05 Lakh, together with interest and penalties, if levied, may have to be paid. As at the year end the Company has fulfilled Export Obligation aggregating Rs.7263.81 Lakh.

Note No. 8

EMPLOYEE BENEFITS DISCLOSURE AS PER AS-15 (REVISED) ISSUED UNDER ACCOUNTING STANDARD RULES 2006 (AS AMENDED).

a. Defined Contribution plans:

During the period ended 31st March, 2014 the Company has recognised the contribution to Employees Provident Fund and Pension Fund aggregating Rs.42,06,379/- (Previous year Rs.1,26,33,798/-) in the Profit & Loss Account.

II. Leave Encashment

Provision towards liability for Leave Encashment made on the basis of actuarial valuation as per Accounting Standard 15 (Revised). Actuarial value of liability is Rs.22,70,995/- (Previous year Rs.30,80,839/-) is based upon following assumptions.

Discount rate: 8.75%-9.2% (Previous year 8.00% - 8.75%)

Salary escalation: 5.00% - 7.00% (Previous year 5.00% - 7.00

* There is no repayment schedule for the above loans.

* Birla Cotsyn (India) Ltd FZE is an wholly own subsidiary of Birla Cotsyn India Limited and the loans advanced to the Company for furtherance of its business, further the loan is interest free. No further loan has been advanced during the current period. The increase in Loan Account is on account of Foreign Exchange Fluctuation resulting from restatement of loan account at exchange rate prevailing as at 31st March, 2014.

* No debt due from or to related parties are written off or written back during the year.

* Related parties are identified by the Management and relied upon by the Auditors.

Note No. 9

During the year the company has capitalised Nil interest (Previous year Nil).

Note No. 10

There is no exceptional item in the Current Yfear.

Note No. 11

Comparative figures for the previous year have been regrouped and / or rearranged wherever necessary.

Note No. 12

Consequent on losses incurred by the company in the past period, the company financial position has substantially gone down resulting in erosion of current assets significantly.


Jun 30, 2013

1. CORPORATE INFORMATION

Birla Cotsyn (India) Limited ("the Company") is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956 having its registered office at Dalamal House, first floor, Nariman Point, Mumbai 400 021.

The principal business of the Company is Cotton and Synthetic Yarn Manufacturing, Weaving of Grey Fabrics, Ginning & Pressing of Cotton Bales and Fabric Trading

Note No.2

The Government of India has approved import of Capital Equipment under the "Exports Promotion Capital Goods Scheme" at a concessional rate of custom duty. Under the Scheme the Company purchased Capital Goods at nominal duty for which the Company has an export obligation aggregating to Rs.13036.91 Lacs (previous year Rs.13167.39 Lacs), to be fulfilled within eight years from the date of issuance of respective licences, failing which the duty saved aggregating Rs.1629.61 Lacs (previous year Rs.1645.92 Lacs), together with interest and penalties, if levied, may have to be paid.

As at the year end the Company has fulfilled Export Obligation aggregating Rs.7338.62 Lacs (previous year Rs.5226.05 Lacs)

A. Defined Contribution Plans:

During year ending 30th June 2013, the Company has recognised the contribution to Employees Provident Fund and Pension Fund aggregating Rs.12,633,798 (Previous year Rs.10,181,308 ) in the Profit & Loss Account.

- There is no repayment schedule for the above loans

- Birla Cotsyn (India ) Ltd FZE is an wholly own subsidiary of Birla Cotsyn India Limited and the loans advanced to the Company for furtherance of its business, further the loan is interest free.

- No debt due from or to related parties are written off or written back during the year.

- Related parties are identified by the Management and relied upon by the Auditors.

Note

1. Textile includes manufacture of Synthetic Yarn, Cotton Yarn, Ginning and Pressing.

2. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS -17) taking into account the organisation structure as well as the differential risks and returns of these Segments. All Segments assets and liabilities are directly attributable to the Segment.

3. Segment Revenue and Expenses are those which are directly attributable to the Segment.

Note No.3

During the year the company has capitalised Nil interest (Previous year Nil).

Note No.4

The exceptional item is the gain on forex fluctuation of GDR proceeds in the foreign bank A/c

Note No.5

Premises taken on Operating Lease

a. The Company has Operating Lease Agreements for the Office building and other premises. The rental expenses for the Operating Lease aggregating Rs.Nil (Previous year Rs. 4,224,026) has been debited to the Profit and Loss Account for the year.

b. Future lease rentals are determined on the basis of agreed terms.

c. At the expiry of the lease term, the Company has an option either to return the asset or extend the term by giving notice in writing.

d. The total future minimum rentals payable as at the Balance Sheet date are as under:

Note No.6

Comparative figures for the previous year have been regrouped and / or rearranged wherever necessary.

Note No.7

Consequent on losses incurred by the company in the past period, the company financial position has substantially gone down resulting in erosion of current assets significantly.


Mar 31, 2012

1. CORPORATE INFORMATION

Birla Cotsyn India Limited is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, I956.

[A] Terms/ rights attached to the equity shares

The company has only one class of equity shares having a par value of Rs.1/- per shares. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends (if any) in Indian rupees. The dividends (if any) 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 of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts, if any. 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 except for shares held by Bank of New York Mellon which are in the form of GDR.

[B] Details of shares issued other than cash for the period of Five Years immediately preceeding the Balance Sheet date.

113,547,000 Equity Shares of Rs.1/- each have been allotted on 28th June, 2006 as fully paid Bonus Shares by Capitalisation of Reserves & Securities Premium Account.

426,981,554 Equity Shares of Rs.1/- each have been allotted on 4th October, 20I0 as fully paid Bonus Shares by Capitalisation of Reserves & Securities Premium Account.

Security and Terms of repayment including current maturities of long term borrowings.

a) Term Loan from SICOM Ltd. carries interest @ 16.75% p.a. The entire loan is repayable in 10 quarterly Instalments of Rs. 60.00 Lacs and 10 quarterly instalment of Rs.40.00 Lacs, with the last Instalment due on 15th September, 2012. Outstanding principal amount as at 31st March, 2012 is Rs.7,000,000/- There is an default in Interest of Rs.173,127/-

b) Term Loan from Union Bank of India carries interest @ 15.75 % p.a.The entire loan is repayable in 32 quarterly Instalments of Rs. 62.50 Lacs, with the last instalment due on 31st March, 2017. Outstanding principal amount as at 31st March, 2012 is Rs.131,116,462/-. There is a default in Instalment Rs.6,250,000/- & Interest Rs.5,393,341/-.

c) Term Loan from Axis Bank Ltd. carries interest @ 15.00% p.a.The entire loan is repayable in 28 quarterly Instalments of Rs. 53.57 Lacs, with the last instalment due on 31st December, 2015. Outstanding principal amount as at 3Ist March, 2012 is Rs.78,505,284/-. There is a default in Instalment for Rs.5,357,143/- and Interest of Rs.3,441,507/-

d) Term Loan from Bank Of India carries interest @ 16.25% p.a. The entire loan is repayable in 30 quarterly Instalments of Rs. 83.33 Lacs, with the last instalment due on 31st March, 2017. Outstanding principal amount as at 31st March, 20I2 is Rs.172,499,052/-. There is a default in Instalment Rs.8,333,333/- & Interest Rs.7,557,522/-.

e) Term Loan from Indian Overseas Bank carries interest @ 15.50% p.a. The entire loan is repayable in 30 quaterly Instalments of Rs. 83.33 Lacs, with the last instalment due on 31st July, 20I7. Outstanding principal amount as at 31st March, 20I2 is Rs.191,629,337/-. There is a default in Instalment Rs.8,333,300/- & Interest Rs.7,611,426/-.

f) Term Loan from Oriental Bank of Commerce carries interest @ I7.00 % p.a. The entire loan is repayable in 30 quarterly Instalments of Rs. 50.00 Lacs, with last instalment due on 30th June, 20I6. Outstanding principal amount as at 31st March, 20I2 is Rs.89,722,775/-. There is a default in Instalment Rs.5,000,000/- & Interest Rs.4,171,44I/-.

g) Term Loan from Canara Bank carries interest @ 15.00 % p.a. The entire loan is repayable in 24 Quaterly Instalments of Rs. 62.50 Lacs with the last instalment due on 3Ist December, 2015. Outstanding principal amount as at 31st March, 20I2 is Rs.100,000,063/-. There is a default in Instalment Rs.6,250,000/- & Interest Rs.1,799,359/-.

h) Term Loan from State Bank of India carries interest @ 17.75% p.a. The entire loan is repayable in 8 monthly Instalments of Rs.15.60 Lacs, 1st monthly instalment of Rs.16.20 Lacs, 36 monthly instalments of Rs.13.00 Lacs, 44 monthly instalment of Rs. 16.65 Lacs, 4 monthly Instalments of Rs. 16.85 Lacs, 2 monthly instalment of Rs. 30.30 Lacs & Imonthly instalment of Rs. 30.40 Lacs, with the last instalment due on 30th June, 2017. Outstanding principal amount as at 31st March, 20I2 is Rs.107,300,000/-. There is a default in Instalment Rs.3,900,000/- & Interest Rs.4,823,001/-.

i) Term Loan from The Catholic Syrian Bank Ltd. carries interest @ 15.50% p.a. The entire loan is repayable in 20 quaterly Instalments of Rs. 50.00 Lacs with the last instalment due on 31st March, 2015. Outstanding principal amount as at 31st March, 20I2 is Rs.62,670,664/- There is a default in Instalment Rs.5,000,000/- & Interest Rs.2,681,958/-.

j) Term Loan from Janakalyan Sahakari Bank Ltd. carries interest @ 15.00% p.a. The entire loan is repayable in 77 monthly Instalments of Rs. 3.21 Lacs and 1st monthly instalment of Rs.2.83 Lacs, with the last instalment due on 31st January, 2015. Outstanding principal amount as at 31st March, 2012 is Rs.19,294,804/-. There is a default in Instalment Rs.963,000/-.& Interest Rs.554,099/-.

k) Term Loan from Bank Of India, (Housing Complex) carries interest @ 15.25 % p.a. The entire loan is repayable in 89 monthly instalments of Rs. 8.00 Lacs and I monthly instalment of Rs.3.00 Lacs, with the last instalment due on 30th August, 2019. Outstanding principal amount as at 31st March, 20I2 is Rs.57,321,482/-. There is a default in Instalment Rs.800,000/- & Interest of Rs.2,207,320/-.

l) Vehicals Loan from Axis Bank Ltd. carries interest @ 9.50 % p.a. (on a monthly reducing basis) The entire loan is repayable in 35 monthly instalments of Rs. 20,340/- each with the last instalment due on 1st November, 20I2. Outstanding principal amount as at 3Ist March, 2012 is Rs.157,073/-. Vehical Loan from ICICI Bank Ltd.. carries interest @ 10.75% p.a. The entire loan is repayable in 36 monthly instalments of Rs.33,300/- each with the last instalment due on I5th December, 2012. Outstanding principal amount as at 31st March, 2012 is Rs.630,212/-.

m) All the above Term Loans have First pari passu charge on all the fixed assets (present and future) pertaining to all the assets of the Company and Second pari passu charges on all the stocks and Book debts of the Company

n) The Vehicle Loan Finance is secured by Hypothecation of respective vehicles.

Note - 2 CONTINGENT LIABILITIES NOT PROVIDED FOR:

Particulars 2011-2012 2010-2011 (Amt in Rs) (Amt in Rs)

a) Claims against Company not acknowledged as debt 102,000 102,000

b) Labour matter pending with the court 75,00,000 1,515,097

Ultimate outflow for the matters referred to above depends on the settlement of these cases

Note - 3

In the absence of necessary information relating to the suppliers registered as Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, the Company has not been able to indentify such suppliers and disclose the information required under the said Act relating to them.

Note - 4

The Government of India has approved import of Capital Equipment under the "Exports Promotion Capital Goods Scheme" at a concessional rate of custom duty. Under the Scheme the Company purchased Capital Goods at nominal duty for which the Company has an export obligation aggregating to Rs.13167.39 Lacs (previous year Rs.13167.39 Lacs), to be fulfilled within eight years from the date of issuance of respective licences, failing which the duty saved aggregating Rs.1645.92 Lacs (previous year Rs.1645.92 Lacs), together with interest and penalties, if levied, may have to be paid.

As at the year end the Company has fulfilled Export Obligation aggregating Rs.5226.05 Lacs (previous year Rs.2309.03 Lacs)

Note - 5

There are no derivative instruments outstanding as at the year end. Foreign currency exposure which are not hedged as at the year end are as follows

Note - 6 EMPLOYEE BENEFITS DISCLOSURE AS PER AS-15 (REVISED) ISSUED UNDER ACCOUNTING STANDARD RULES 2006 (AS AMENDED).

A Defined Contribution Plans:

During year ending 31st March 2012, the Company has recognised the contribution to Employees Provident Fund and Pension Fund aggregating Rs.10,181,308 (Previous year Rs.9,039,436) in the Profit & Loss Account.

B Defined Benefit Plans:

i Contribution to Gratuity.

Provision for Gratuity has been made on the report of Actuary as at the year ended 31st March 20I2. The Company has funding arrangement with LIC for Khamgaon, Dhule and Ghatanji units. For Head office, Synthetic and Malkapur units there are no such arrangement. The liability towards the employees is discharged in the year of retirement / cessation of employment. Details under the AS -I5, are furnished below:

ii. Leave Encashment

Provision towards liability for Leave Encashment made on the basis of actuarial valuation as per Accounting Standard 15 (Revised). Actuarial value of liability is RsI,252,796 (Previous year Rs 994,500) based upon following assumptions Discount rate 8.00% - 8.75% (Previous year 8.00% - 8.25%)

Salary escalation 5.00% - 7.00% (Previous year 5.00% - 7.00%)

- There is no repayment schedule for the above loans

- Birla Integrated Textile Park Limited is an subsidiary company of Birla Cotsyn India Limited, wherein Birla Cotsyn India Limited has an holding of 51% and the loans have been advanced to Birla Integrated Textile Park Limited for execution of the project.

- Birla Cotsyn (India) Ltd FZE is an wholly own subsidiary of Birla Cotsyn India Limited and the loans advanced to the Company for furtherance of its business, further the loan is interest free.

d) No debt due from or to related parties are written off or written back during the year.

- Related parties are identified by the Management and relied upon by the Auditors.

Note - 7

During the year the company has capitalised Nil interest (Previous year Rs. 23,765,III).

Note - 8

The exceptional item is the gain on forex fluctuation of GDR proceeds in the foreign bank A/c

Note - 9

Premises taken on Operating Lease

a. The Company has Operating Lease Agreements for the Office building and other premises. The rental expenses for the Operating Lease aggregating Rs.4,224,026 (Previous year Rs. 3,791,460) has been debited to the Profit and Loss Account for the year.

b. Future lease rentals are determined on the basis of agreed terms.

c. At the expiry of the lease term, the Company has an option either to return the asset or extend the term by giving notice in writing.

d. The total future minimum rentals payable as at the Balance Sheet date are as under:

Note - 10

Comparative figures for the previous year have been regrouped and / or rearranged wherever necessary.


Mar 31, 2011

1. Contingent Liabilities not provided for in respect of:

Particulars 2010 - 2011 2009 - 2010 (Amt in Rs) (Amt in Rs)

a) Claims against Company 102,000 102,000 not acknowledged as debt

b) Labour matter pending 1,515,097 1,515,097 with the court

Ultimate outflow for the matters referred to above depends on the settlement of these cases

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 9,297,5 13 (previous year Rs. 4,453,574)

3. In the absence of necessary information relating to the suppliers registered as Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, the Company has not been able to indentify such suppliers and disclose the information required under the said Act relating to them.

4. The Government of India has approved import of Capital Equipment under the "Exports Promotion Capital Goods Scheme" at a concessional rate of custom duty. Under the Scheme the Company purchased Capital Goods at nominal duty for which the Company has an export obligation aggregating to Rs. 13 167.39 Lakhs (previous year Rs. 12538.10 Lakhs), to be fulfilled within eight years from the date of issuance of respective licences, failing which the duty saved aggregating Rs. 1645.92 Lakhs (previous year Rs. 1604.07 Lakhs), together with interest and penalties, if levied, may have to be paid.

As at the year end the Company has fulfilled Export Obligation aggregating Rs.2309.03 Lakhs (previous year Rs.861.54 Lakhs)

5. B. The Company has issued 106,745,500 Convertible Equity Shares Warrants on 12th October, 2010 to the Promoter's of the Company at an issue price of Rs. 1. 13 per Warrant. On 15th March, 2011 the Company has converted 50,372,750 Equity Shares at Rs. I amounting to Rs. 50,372,750 and premium of Rs. 0.13 amounting to Rs. 6,548,457 transferred to the Securities Premium Account. Listing approval has been received from BSE and awaited from NSE. As on 31st March, 2011 56,372,750 Convertible Equity shares Warrants amounting to Rs 63,701,208 at an issue price of Rs. 1.13 is outstanding of which 25% amounting to Rs. 15,925,698 is in the share warrant account with the Company.

C. The Company allotted 968,900,000 Equity Shares of face value of Rs. I per share at a premium of Rs.0.20 per Share under the GDR offer aggregating Rs. 1,128,392,567 including the premium of Rs. 159,492,567, on 15th March 2010 for General Corporate purpose and long term Working Capital Requirements (including cost of setting up foreign subsidiaries). The proceeds net of expenses (Expenses of Rs.42,858,852) and interest income (Interest Income of Rs. I 1,160,856) were partly utilised for capitalization of its Wholly Owned Subsidiary - Birla Cotsyn (India) Ltd (FZE), which includes investment subsidiary (Rs.43 1,473), loans to subsidiary (Rs.352,703,289 and) and exchange loss of Rs. 2,075,238 due to US Dollar / AED conversion, Partly for Project advances and General Corporate purpose (Rs.20,800,804) and the balance amount of Rs.717,723,781 (Net of Foreign Exchange loss is Rs. 2,959,985.) is held in current account with a non - scheduled bank, pending utilisation. Hence the question of verification does not arise.

6. Disclosure pursuant to Accounting Standard AS-15 "Employee Benefits."

A. Defined Contribution Plans:

During year ending 31st March 2011, the Company has recognised the contribution to Employees Provident Fund and Pension Fund aggregating Rs.9,039,436 (previous year Rs.8,617,756) in the Profit & Loss Account.

B.Defined Benefits Plans:

II. Leave Encashment

Provision towards liability for Leave Encashment made on the basis of actuarial valuation as per Accounting Standard 15 (Revised). Actuarial value of liability is Rs. 994,500 (previous year Rs 1, 159,195) based upon following assumptions

Discount rate 8.25% - 8.50% (Previous year 8.25%)

Salary escalation 5.00% - 7.00% (Previous year 5.00% - 6.50%)

7. During the year the company has capitalised interest aggregating to Rs. 23,765,1 II (Previous year Rs. 79,793,905).

8. Premises taken on Operating Lease

a. The Company has Operating Lease Agreements for the Office building and other premises. The rental expenses for the Operating Lease aggregating Rs. 3,791,460 (previous year Rs. 1,764,800) has been debited to the Profit and Loss Account for the year.

b. Future lease rentals are determined on the basis of agreed terms.

c. At the expiry of the lease term, the Company has an option either to return the asset or extend the term by giving notice in writing.

9. Comparative figures for the previous year have been regrouped and or rearranged wherever necessary.

 
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