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Notes to Accounts of IO System Ltd.

Mar 31, 2014

1. Contingent liabilities & commitments

(1) Contingent Liabilities Figures as at Figures as at 31-03-2014 31-03-2013 Rs. Rs.

a) Claims against the company NIL NIL not acknowledged as debts

b) Guarantees NIL NIL

c) Other money for which NIL NIL company is contingently liable

(2) Commitments

a) Estimated amounts of contracts NIL NIL to be executed on capital account not provided for

b) Uncalled liability on partly paid shares NIL NIL

c) Other commitments NIL NIL

2 The company being listed on stock exchange, therefore, has complied with all the notified applicable Accounting Standards read with General Circular 15/2013 dated 13.09.2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

3 The revised schedule VI as notified under the Companies Act, 1956 continues to be applicable to the company for its financial statements for the year ending March 31, 2014. The schedule III notified under the Companies Act, 2013 would be applicable for the Financial Year beginning on or after 01.04.2014.

4 Deferred Taxes

As per Accounting Standard AS - 22 "Taxes on Income" the company has deferred tax assets on its carried forward losses and unabsorbed depreciation. At present there are no trading and manufacturing in the company on account of losses. In view of virtual uncertainty of future profits in immediate succeeding years, the Deferred Tax Assets/Liabilities (DTA/DTL) has not been recognised in the books of account.

5 Previous year figures have been regrouped/re-classified wherever considered to make comparable with the current year figures.


Mar 31, 2013

Contingent liabilities & commitments

(1) Contingent Liabilities

a) Claims against the company not acknowledged as debts NIL NIL

b) Guarantees NIL NIL

c) Other money for which company is contingently liable NIL NIL

(2) Commitments

a) Estimated amounts of contracts to be executed on capital account NIL NIL not provided for

b) Uncalled liability on partly paid shares NIL NIL

c) Other commitments NIL NIL

* Representing interest allowed as per bank certificate on margin money FDRs'' encased during the year.

2. The Revised Schedule VI as notified under the Companies Act, 1956, continues to be applicable to the Company for its financial statements for the year ending March 31, 2013. The adoption of the revised Schedule VI requirements presentation has significantly modified the presentation and disclosures which have been complied with in these financial statements.

3 The company being listed on stock exchange, therefore, has complied with all the notified applicable Accounting Standards.

4 Deferred Taxes

As per accounting standard (AS 22), the company has deferred tax assets on its carried forward losses and unabsorbed depreciation. At present there are no trading and manufacturing activities in the company on account of losses. In view of virual uncertainty of future profits in immediate succeeding years, the Deferred Tax Assets / Liabilities (DTA/(DTL) has not been recognized in the books of account.

5. Previous year figures have been regrouped/re-classified wherever considered to make comparable with the current year figures.

6. All schedules annexed to and from integral part of the Balance Sheet and Profit & Loss Account.


Mar 31, 2012

(a) The above information [from (a) to (d)] is 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 ownerships of shares.

*The above inventory carried in the financials does not have commercial sale value and therefore, a provision of Rs. 2,00,000/- has been made for obsolescence/diminution in value.

Contingent liabilities & commitments

(1) Contingent Liabilities

a) Claims aganinst the company not acknowledged as debts NIL NIL

b) Guarantees NIL NIL

c) Other money for which company is contingently liable NIL NIL

(2) Commitments

a) Estimated amounts of contracts to be executed on capital account NIL NIL not provided for

b) Uncalled liability on partly paid shares NIL NIL

c) Other commitments NIL NIL

3. The schedule VI as notified under the Companies Act, 1956 has become applicable to the company for its financial statements for the year ending March 31, 2012. The adoption of the revised schedule VI requirements presentation has significantly modified the presentation and disclosures which have been complied with in these financial statements. Previous year figures have been restated in accordance with current year requirements.

4. The company being listed on stock exchange, therefore, has complied with all the notified applicable Accounting Standards.

5. Deferred Taxes

As the commercial activities are yet to commence, therefore, the Deferred Tax Assets / Liabilities (DTA/(DTL) has not been recognized in the books of account in compliance of Accounting Standard (AS) -22.

6. Previous year figures have been regrouped/re-classified wherever considered to make comparable with the current year figures.

7. Value of Import on CIF Basis Nil

8. Earnings in Foreign Exchange Nil

9. Expenditure in Foreign Currency Nil


Mar 31, 2010

1. BACKGROUND

The company had entered into a joint venture (JV) agreement with the General Binding Corporation (GBC), USA on 19th June, 1988 for manufacturing and selling office Automotion products. The JV was terminated with mutual consent between the parties on 31st March, 2002 and almost entire capital of the company is held by Spice Enfotainment Ltd.(formerly known as Spice Corp. Ltd.) except little shareholding with the public. The manufacturing activities had been discontinued since Feb., 2006 due to continued losses in the company. The company has also not done very well in its trading business as a result of which, there have been no business activities in the company during the financial year 2009-10

2. HOLDING COMPANY

The company continues to be subsidiary of Spice Enfotainment Ltd. (formerly known as Spice Corp. Ltd.)

3. SUBSIDIARY COMPANY

The company ceased to be holding company of Bharat IT Services Ltd. (Formerly Spice Net Ltd.) w.e.f. 12.05.2009

4. The Company is a non small and medium enterprises sized company as defined in the general instructions in respect of Accounting Standards notified under the Companys Act, 1956. Accordingly, all the applicable accounting standards have been complied with.

5. The Company has been carrying obsolete and damaged inventory for quite some time, which it could not dispose off due to non availability of suitable marketing personnel in the company and sluggish market conditions. At the instance of the Board, the inventories were got valued from registered valuer who had declared them as scrap and valued at Rs. 2.25 lacs. Accordingly, the carrying value has been taken at Rs. 2.25 lacs in the present financials.

6. During the year, the company has taxable losses after adjusting capital gains, therefore, no provision has been made on account of Income lax.

7. The Company owned Land and Building at Modipuram, Distt. Meerut, which had been sold to Bougainvillea Multiplex & entertainment Pvt. Ltd. (BMEC) in terms of MOU dated 04.09.2006 for Rs. 86 lacs. As per terms of MOU, the Company was under an obligation to BMEC for transfer of properties by executing requisite sale deed within a period of 90 days. Due to certain unavoidable reasons, the transfer deed of properties could not be executed. During the current year, BMEC has written to the company to refund its money of Rs. 86 lacs alongwith interest @8% p.a.. Thereafter.a Memorandum of Termination has been executed between the parties on 16.06.2009. The amount of Rs. 86 lacs alongwith interest @8% of Rs. 19.29 lacs has been refunded to BMEC. The same land & building has been sold for Rs. 110 lacs subsequently to a thifa party. The resultant profit has been duly accounted for in the books of account of the company.

8. DEFERRED INCOME TAXES

As per guidance note of The Institute of Chartered Accountants of India on Accounting Standard (AS) - 22, the Company at the prevailing income tax rates as on 31st March, 2010, has Deferred Tax Assets (DTA) of Rs. 155.78 Lacs on its carried forward accummulated business losses , unabsorbed depreciation, provision for bad and doubtful debts & advances and expenses deductible on payment basis. Similarly, the compamy has Deferred Tax Liability (DTL) of Rs.0.10/-lacs on account of timing difference of depreciation.

Based on the past performance of the Company over the years there is significant uncertainty on the realisability of the benefits of those deductible differences and consequently, the DTA and DTL have not been recognised in the books of account.

9. In the opinion of the Board of Directors, the current assets, loans and advances have a value on realisation in the ordinary course of business, atleast equal to the amount at which they are stated in the books of account.

10. The balances appearing in the books at the close of the financial year under the heads Sundry Debtors, Sundry Creditors ,Loans and Advances are subject to confirmation.

11. No provision has been made in the accounts against the liability in respect of future payment of gratuity to the employees as lone employee has not put in the qualifying period of service for entitlement to the said benefit under the Provisions of Payment of Gratuity Act, 1972.

12. The liability on account of Leave Encashment in respect of Idne employee has been duly provided for on the basis of leave accrued and accumulated to the each employee.

13. RELATED PARTY TRANSACTIONS

During the year, the Company entered into transactions with related parties. Those transactions along with related balances as at March 31 , 2010 and March 31, 2009 are given in the following table:

List of the related Parties (As certified by the management)

Name of the Related Party Relation

i) Spice Enfotainment Limited (Formerly Spice Corp. Ltd.) Holding Company

ii) Bharat IT Services Limited (formerly Spice Net Limited) ceased w.e.f 12.05.2009 Subsidiary company

iii) First Choice Enterprises P.Ltd. Common Direcor and Fellow Subsidiary of i) above.

The names of other associate companies have not been disclosed because of Nil transactions with them during the year.

14. SEGMENT REPORTING

Segment wise reporting as defined in Accounting Standard AS-17 is not applicable, since the entire operations of the company relates to one segment i.e. Office Automation Equipment.

15. CONTINGENT LIABILITIES

Contingent liabilities are not provided for and are disclosed by way of note.

(a) Claims against the Company not acknowledged as debts

- Excise matters - Rs. 39,87,122/- (2009 - Rs. 39,87,122/-)

- Sales Tax matters (including demands in respect of non-submission of statutory sales tax declaration forms) - Rs1,94,98,3777- (2009 - Rs. 2,03,20,094/-)

- Other cases against the company - Rs. 1,246,664/- (2009 - Rs. 1,246,664/-)

(b) Counter Guarantees issued Rs 6,82,700/- (2009 - Rs. 6,82,700/-).

(c) To income tax department for Rs. 4745000/- towards penalties imposed against which company is in appeal.

16. Previous years figures have been regrouped and/or reclassified wherever necessary to make their classification comparable with that of the current year.

 
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