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Notes to Accounts of Globus Spirits Ltd.

Mar 31, 2015

1 Corporate information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act. The Company is primarily engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Indian Made Foreign Liquor (IMFL), Bulk Alcohol and Franchise Bottling.

2.1 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises De velopment Act, 2006

There are no dues to enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). Further no interest has been paid under the terms of MSMED Act, 2006. Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

2.2 Details on derivative instruments and unhedged foreign currency exposures:

Forward exchange contracts, which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency available at the settlement date of certain receivables.

3.1 Defined contribution plans

The Company makes Provident 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. 32.43 lac (Year ended 31 March, 2014 Rs. 29.53 lac) for Provident Fund contributions, and Rs. 2.33 lac (Year ended 31 March, 2014 Rs. 2.89 lac) 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.

3.2 Defined benefit plans

The Company's defined benefit scheme represents gratuity scheme for its employees:

The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial statements:

Note 4 Previous year's figures

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


Mar 31, 2014

1 Corporate information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act,1956. The Company is primarily engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Indian Made Foreign Liquor (IMFL), Bulk Alcohol and Franchise Bottling.

Note 2 Additional information to the financial statements

2.1 Money received against share warrants

The Board of Directors of the Company at their meeting held on 7January, 2013 and as approved at its Extra ordinary General Meeting held on 6 February, 2013 have resolved to create, offer, issue and allot up to 1,428,572 warrants, convertible into e quivalent number of equity shares of Rs.10 each on a preferential allotment basis, pursuant to Section 81(1A) of the Comp anies Act, 1956, at a conversionp rice of Rs.140 per equity share of the Company, arrived at in accordance with the SEBI Guidelines in this regard and subsequently 763,359 warrants were allotted on 19 March, 2013 to the Promoters and 25% application money amounting to Rs.267.17 lacs was received from them. The warrants may be converted into equivalent number of shares on payment of the balance amount at any time on or before 18 September, 2014. In the event the warrants are not converted into shares within the said period, the Company is eligible to forfeit the amounts received towards the warrants.

2.2 Contingent liabilities and commitments (to the extent not provided for)

(Rs. in lacs)

As at As at 31 March, 2014 31 March, 2013

(i) Contingent liabilities

(a) Claims against the Company not acknowledged as debt Excise duty matters 180.81 38.75

Income tax matters 215.44 -

Other matters 75.86 -

(b) Guarantees

Guarantees by bank on behalf of company 367.33 13.79

(ii) Commitments

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

Tangible assets 233.09 -

2.3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

There are no dues to enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). Further no interest has been paid under the terms of MSMED Act, 2006. Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

2.4 Details on derivative instruments and unhedged foreign currency exposures:

Forward exchange contracts, which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency available at the settlement date of certain receivables.

3.1 Defined contribution plans

The Company makes Provident 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. 29.53 lacs (Year ended 31 March, 2013 Rs.34.10 lacs) for Provident Fund contributions, and Rs.2.89 lacs (Year ended 31March, 2013 Rs.3.20lacs) forEmployee 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.

3.2 Defined benefit plans

The Company''s defined benefit scheme represents gratuity scheme for its employees:

The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.

The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

* Information pertaining to experience adjustment have been furnished to the extent available with the Company.

Segment information

Based on the guiding principles given in Accounting Standard on ''Segment Reporting'' (AS-17), the Company''s primary business segment is Industrial and Potable Alcohol. The alcohol business incorporates product groups viz. IMIL, IMFL, Bulk Alcohol and Franchise operations, which mainly have similar risks and returns. As the Company''s business activity falls within a single primary business segment the disclosure requirements of AS -17 in this regard are not applicable.

Note 4 Related party transactions

4.1 Details of related parties:

Description of relationship Names of related parties

(i) Associates Chandbagh Investments Limited

(ii) Key Management Personnel (KMP) Mr. Ajay Kumar Swarup

Mr. Shekhar Swarup

Dr. Bhaskar Roy

Mr. Manik Lal Dutta

Mr. R.D Aggarwal- Up to November 11, 2013

(iii) Relatives of Key Management Personnel (KMP) Mrs. Madhavi Swarup- Wife of Mr. Ajay Kumar Swarup

Mrs. Saroj Rani Swarup- Mother of Mr. Ajay Kumar Swarup Mrs. Pratima Roy- Wife of Dr. Bhaskar Roy Mrs. Anju Aggarwal- Wife of Mr. R.D Aggarwal

(iv) Entities in which KMP can exercise Biotech India Limited

significant influent Chandbagh Investments Limited

GRAS education and training Services Private Limited

Himalayan Spirits Limited

Globus Spirits (Jharkhand) Limited

Globus Trois Freres India Limited

Globus Feeds Private Limited

V C technologies Private Limited

Northen India Alcohol Sales Private Limited

Rajasthan Distilleries Private Limited

Associated Distilleries Limited

4.2 Based on projections for future taxable income, which has been approved by the Board of Directors, Minimum Alternate Tax (MAT) Credit of Rs.1,287.98 lacs (including Rs.1,195.95 lacs pertaining to earlier years) has been recognised during the year.

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


Mar 31, 2013

Corporate Information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act,1956. The Company is primarily engaged in the business of alcohol industry including Indian Made Indian Liquor( IMIL), Indian Made Foreign Liquor( IMFL), IMFL Francise Bottling and Bulk Alcohol.

1. Taxes on Income

(i) Current tax is the provision made for the MAT payable during the year in accordance with the provisions u/s 115JB of the Income Tax Act, 1961

(ii) Current Tax is determined as per the provisions of the Income Tax Act, 1961 in respect of Taxable Income for the year. Deferred tax is recognized, on timing differences, being the difference resulting from the recognition of items in the fnancial statements & in estimating its current income tax provision. Deferred Tax Assets and Deferred Tax Liabilities are computed by applying tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet Date.

2. Related party disclosures as required in terms of “Accounting Standard - 18” are given below :

(i) Key Management Personnel Sh. Ajay K. Swarup

(ii) Associate Companies M/s Biotech India Limited

M/s Rajasthan Distilleries Pvt. Ltd.

M/s Associated Distilleries Ltd.

M/s Chandbagh Investments Ltd. (No transaction done during the year)

3. Contingent Liabilities not provided for:-

a Contingent Liabilities not provided in the book of account of Rs.38,75,173/- Security executed in favour of Excise authorities for bottling case pending before the high court for Punjab & Haryana which is related to Demerged undertaking of M/s Associated Distilleries Ltd.

b Bank Guarantees issued by the Company in favour of various parties amounting to Rs.1,378,820/-

4. Deferred Revenue Expenditure

“Deferred revenue- Brand Promotion Expenses” appearing in Asset side in the Balance Sheet are the expenditure incurred on promoting company''s new IMFL brands already launched during the year 2007 and which have perpetual beneft to the company and thus it was shown under the head Deferred revenue- Brand Promotion Expenses, which is being written off in fve years & the current year being the ffth year, thus it is fully written off.

5. SSI Liabilities

As explained, there is no amount due to small-scale industries over Rs. 1 lac shown under the head “sundry Creditors”

6. Balances of Debtors, Creditors and Advances to and from parties are subject to Reconciliation and confrmation.

7. In the opinion of the Board, the value of Current Assets, Loans & Advances in the ordinary course of business will not be less than the value at which they have been stated in the Balance Sheet.

8. The proft & loss account and Balance sheet comply with Accounting Standard referred to in section 211 (3C) of the Companies Act, 1956

9. Insurance claim which are of not signifcant value are accounted for on receipt basis.

10. An Inter unit transaction of Rs.6075.51lacs for the FY2012-13 (Rs.5045.25lacs for the FY2011-12) towards generation & consumption of steam & energy has been deducted from total turnover & also deducted from manufacturing expenses under the sub-heading consumption of power & fuel. However till the period ending 31st December 2012, we used to include the fgure for “generation & consumption of steam & energy” in the turnover side & consumption of power & fuel side. Hence the new practice has been adopted & given effect in the abovementioned quarter ending & year ending results for their proper comparision.

11. Previous year fgures have neen regrouped where necessary to conform to revised schedule VI requirement


Mar 31, 2012

(a) Contingent Liabilities and Contingent Assets (AS-29)

Contingent Liabilities not provided in the book of account of Rs.SSJSJTS/- Security executed In favour of Excise authorities for bottling case pending before the high court for Punjab & Haryana which Is related to Demerged undertaking of IWs Associated Distilleries Limited.

(b) SSI Liabilities

As explained' there Is no amount due to small-scale industries over Rs.1 Sac shown under the head "sundry Creditors*

(c) Cash Flow Statement

Cash flows are reported using the indirect method' whereby profit before tax is adjusted for the effects of transactions Of a non-cash nature' any deferrals Or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating' investing and financing activities of the Company are segregated.

(b) Foreign Currency Transaction

(I) Transaction denominated in foreign currants a re recorded at the exchan gerate prevai tin g on the date of the transaction or that approximates the actual rate at the date of the transaction.

(II) Monetary Items denominated in foreign currencies at the year end are restated at year end rates' in case of items which are covered by forward exchange contracts' the difference between the year end rate and rate on the date of the contract is recognized as exchange difference end the premium paid on forward contracts is recognized over the life of the contract.

(e) Capital commitment related to capacity expansion is Rs. S1 S.94 lac as on 31st March 2012.

(f) Related party disclosures as required in terms of "Accounting Standard -18th are given below:

(i) Key Ma pavement Personnel Sh. Ajay K. Swarup

(ii) Associate Companies M/s Biotech India Limited

M/s Rajasthan Distilleries Pvt. Ltd.

M/s Rambagh Estates Pvt. Ltd.

M/s Chandbagh Investments Ltd. (No transaction done during the year)

(g) Previous year figures have been regrouped where necessary to conform to revised schedule VI requirement

(h) Balances of Debtors' Creditors and Advances to and from parties are subject to Recndliation and confirmation'

(i) In the opinion of the Board' the value of Current Assets' Loans & Advances in the ordinary course of business will not be less than the value at which they have been stated in the Balance Sheet.

(j} The profit & loss account and Blaine sheet com ply with Accountings Standard nefierre d to in section 211 (3C) of the Companies Act 1956 insurance claim which are of not significant value are accounted for on receipt basis.

k. attached to equity sharw*

The company has only one class of equity shares having a par value of Rs. 10 per Shane. Each holder of equity scares Is entitled to one vote per share. The company declares and pays dividend In Indian Rupees. The dividend proposed by the board of directors is subject to approval of the shareholder* in the ensuing Annual General Meeting.


Mar 31, 2010

1. In the opinion of the Board, the value of Current Assets, Loans & Advances in the ordinary course of business will not be less then the value at which they have been stated in the Balance sheet

2. Balances of Debtor & creditors and Advances to and from parties are subject to Reconciliation & Confirmation

3. The amount falling due with in one year in respect of secured loans is Rs.4,86,00,000/-.

4. The profit & loss account and Balance sheet comply with accounting standards referred to in section 211 (3C) of the companies Act 1956.

5. Accounting Standard (AS) -17 "Segment Reporting " is not applicable in case of company because company is involved in only one type of product Industrials Potable Alcohol.

6. There is no amount due to small-scale industries over Rs.1 lac shown under the head "sundry Creditors"

7. "Deferred revenue- Brand Promotion Expenses" appearing in Schedule G in the Balance Sheet are the expenditure incurred on promoting companys new IMFL brands already launched during the year 2007 and which will give perpetual benefit to the company and thus it is shown under the head Deferred revenue- Brand Promotion Expenses, which is being written off in five years.

8. During the year the company has raised Rs.75crores through the initial public issue of 75,00,000 equity shares of Rs.10/- each at a premium of Rs.90/- per equity share for the purpose of expansion of capacity & modernization of existing distilleries. The expenditure incurred towards IPO to the tune of Rs. 12,57,83,784/- is being shown under the head Capital work-in-progress & it will be capitalized as & when the upcoming project will be completed.

9. In accordance with the Accounting Standards (AS-18) on Related Party Disclosures, where control exists and where key management personnel are able to exercise significant influence and, where transactions have taken place during the year, along-with description of relationships identified, are given below :-

A. Relationships

I. Subsidiary Company NIL

II. Joint Venture/Joint Control Associates NIL

III. Key Management Personnel

Name Designation

Sh.AjayK. Swarup Managing Director

IV. Associates

M/s Chandbagh Investments Limited (Holding Company) (no transaction has been entered into during the period)

M/s Associated Distilleries Ltd. (ADL)

M/s Rambagh Estates Private Limited.

10. Taxation

A) Current tax is the provision made as per the normal income tax rate.

B) Deferred tax is recognized, on timing differences, being the difference resulting from the recognition of items in the financial statements & in estimating its current income tax provision.

C) Deferred tax assets are recognized on unabsorbed depreciation to the extent there is virtual certainty supported by convincing evidence & on others to extent that there Is reasonable certainty of their realization

D) Deferred tax assets & liabilities are measured using the tax rates & the laws that have been enacted or substantially enacted at the balance sheet date.

11. The indicators listed in paragraph 8 of Accounting Standard (AS)-28" impairment of assets" issued by Institute of Chartered Accountants of India have been examined & on such examination , it has been found that none of the indicators are present in the case of company. There is no indication of a potential impairment loss, so estimation of recoverable amount has not been made.

12. Insurance claims which are of not significant value are accounted for on receipt basis.

13. Previous years figures has been regrouped, rearranged & reworked wherever necessary to make them comparable with the current year figures.

14. Figures has been rounded off to the nearest rupee.

15. Other information pursuant to para 3 to4D of part-II of schedule VI of the Companies Act 1956 has not been furnished as the same is not applicable.



 
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