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Notes to Accounts of Lawreshwar Polymers Ltd.

Mar 31, 2015

1 Corporate Information

Lawreshwar Polymers Limited (the company) is a public company domiciled in India and incorporated under' the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The company is engaged in manufacturing and selling of a reputed brand "LEHAR" footwears in domestic market.

2 Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting policies in India (Indian GaAp). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevent provisions of the Companies Act, 2013. The financial statements have been prepared on an accrual basis under the historical cost convention, expect for land and building acquired before 31 March 2005 which are carried at revalued amounts.

The accounting policies adopted in the preparation of financial statements are in consistency with those of previous years.

3. Terms/ Rights attached to Equity Shares

The company has only one class of Equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of 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.

Term Loan I from Punjab National Bank was secured against mortgage of factory land & building situated at SP-41D, RIICO Industrial Area, Kaladera, Teh-Chomu, Distt.-Jaipur.

Term Loan II from Punjab National Bank is secured against mortgage of factory land & building situated at SP-41D, RIICO Industrial Area Kaladera, Teh-Chomu, Distt.-Jaipur registered in the name of the company, and G-l-685, Road No.9F2, VKI Area, Jaipur-302013 registered in the name of Lawreshwar Footwear (related party).

Term Loan - II of Rs. 9,21,00,000 sanctioned from Punjab National Bank and amount disbursed upto 31.03.2015 Rs. 6,21,00,000, and is repayable in 84 equal monthly installmets of Rs. 10,96,429 start from April 2015.

Term Loan III of Rs. 4,00,0000 sanctioned from SIDBI and amount disbursed up to 31.03.2015 Rs.2,00,00,000 is secured against residual charge on movable and current assets of the company, and is reapyable in 71 equal monthly instalments of Rs. 5,50,000 and one installment of Rs. 9,50,000 start from October 2015.

Buyers credit for capital goods from Punjab National Bank is secured against hypothecation of respective machineries imported under buyers credit and all other securities available for FB limit and term loan, and is repayable after maximum of 3 years.

4. Cash Credit Limit from Punjab National Bank is secured against hypothecation of Raw Material, Finished Goods, Stock in Process, Store & Spares, Packing Material and book debts, mortgage over fixed assets of the Company & mortgage of certain fixed assets of the related parties and personal guarantees of Directors and other related parties.

5. The Company has not received any intimation from suppliers regarding their status under the Micro, Small & Medium Enterprises Act 2006, hence disclosu res, if any, relating to amounts unpaid as at the year end together with interest paid / payable as required under the said act could not be furnished, however the management does not anticipate any significant interest liability.

6. There had occurred a fire on 24.02.2008 at the registered office & factory premises of the company. The Insurance Company has passed the claim of the company and there is a shortfall of Rs. 1,86,74,521 against the said claim. No provision is made for the same, as the company has not accepted the assessment of loss from insurances companies and has invoked the arbitration clause of the insurance contract and company is of opinion that they will receive the balance amount of Rs. 1,86,74,521 from the insurance companies.

Book debts, advances, creditors, unsecured loans from customers etc. have been taken at their book value and are subject to confirmations and reconcilation.

Loans and advances and debtors have been considered good and in respect of which the company holds no security other than the personal guarantee of the person concerned.

7. Earning Per Share (EPS)

The Company report Basic and Diluted earning per share (EPS) in accordance with Accounting Standard - 20 issued by the Institute of Chartered Accountants of India. The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year. The Diluted EPS have been computed using the weighted average number of equity shares and Diluted potential equity shares outstanding at the end of the year.

8. Disclosure under AS-15 (Revised) - Employee Benefits

Provision has been made for employee benefits gratuity, leave encashment and other benefits in accordance with AS-15 (Revised) on the basis of actuarial valuation.

9. Segment Information

The Board of Directors of the Company considers and maintains Footwear as the only Business Segment of the Company.

10. Related Party Disclosures

The Company has made the following transactions with related parties as defined under the provisions of Accounting Standard-18 issued by the Institute of Chartered Accountants of India.

List of related parties with whom transcation have taken place during the year along with the nature and volume of transaction is given below from 01.04.2014 to 31.03.2015.

11. Contingent Liabilities and Commitments

31/3/2015 31/3/2014

Contingent liabilities

Income Tax Demand against which the 82340 104433 company has filed anappeal (AY 2012-13) (AY 2005-06) before higher authority

Claims against the company / disputed liabilities not acknowledged as debts Nil Nil

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for 15000000 Nil

12. There are no pending litigations against the company which impact the financial position of the company.

13. Previous years figures have been regrouped and rearranged wherever considered necessary.

14. Figures are rounded off to the nearest rupee.


Mar 31, 2014

1. Corporate Information

Lawreshwar Polymers Limited (the company) is a public company domiciled in India and incorporated under the provisions of the Companies Act. 1956. Its shares are listed on Bombay Stock Exchange in India. The company is engaged in manufacturing and selling of a reputed brand "LEHAR" footwears in domestic market

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting policies in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevent provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis under the historical cost convention, expect for land and building acquired before 31 March 2005 which are carried at revalued amounts.

The acounting policies adopted in the preparation of financial statements are in consistency with those of previous years.

3. Terms/ Rights attached to Equity Shares

The company has only one class of Equity shares having a par value of Rs. 10 per share Each holder of equity shares is entitled to one vote per share

In the event of liquidation of 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 hold by the shareholders.

4. * Cash Credit Limit from Punjab National Bank is secured against hypothecation of Raw Material, Finished Goods, Stock in Process, Store & Spares, Packing Material and book debts, mortgage over fixed assets of the Company 8. mortgage of certain fixed assets of the Directors & other related parties and personal guarantees of Directors and other related parties.

** Raw Material Assistance Scheme from NSlC is secured against bank guarantee which is secured by counter indeminity of the Company

The Company has not received any intimation from suppliers regarding their status under the Micro, Small & Medium Enterprises Act 2006, hence disclosures if any, rotating to amounts unpaid ns at the year end together with interest paid / payable as required under the said act could not be furnished, however the management does not antcipate any significant interest liability.

5. There had occurred a fire on 24.02.2008 at the registered office & factory premises of the company. The Insurance Company has passed the claim of the company and there is a Shortfall of Rs. 1,86,74,521 against the said claim. No provision is made for the same, as the company has not accepted the assessment of loss from insurances companies and has invoked the arbitration clause of the insurance contract and company is of opinion that they will receive the balance amount of Rs 1,86,74,521 from the insurance companies.

Book debts, advances, creditors, unsecured loans from customers etc, have been taken at their book value and are subject to confirmation and reconsilation.

Loans and advances and debtors have been considered good and in respect of which the company holds no security other than the personal guarantee of the parson concerned

6. Earning Per Share (EPS)

The Company report Basic and Diluted carning per share (EPS) in accordance with Accounting Standard 20 caused by the Institute of Chartered Accountants of India. The Basic EPS has boon computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year. The Diluted EPS have been computed using the weighted average number of equity shares and Diluted potential equity shares outstanding at the end of the year

7. Disclosure under AS-15 (Revised) - Employee Benefits

Provision has been made for employee benefits gratuity, leave encashment and other benefits in accordance with AS-15 (Revised) on the basis of actuarial valuation

8. Segment Information

The Board of Directors of the Company considers and maintains Footwear as the only Business Segment of the Company.

9. Contingent Liabilities and Commitments 31/3/2014 31/3/2013

Contingent Liabilities

Income Tax Demand for the AY 2005- 06 against which the company has filed an appeal before higher authority 104433 104433

Claims against the company / disputed liabilities not acknowledged as debts Nil Nil

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for Nil Nil

10. Utilsation of money raised through Public Issue

The Company has fully deployed IPO Proceeds as per the offer document and revised capital expenditure plan as passed is AGM held in 2010.

11. Previous years figures have been regrouped and rearranged wherever considered necessary.

12. Figures are rounded off to the nearest rupee


Mar 31, 2013

1 Corporate information

Lawreshwsr Polymers Limited (trie company) is a public company domiciled in India end Incorporated under the provisions Of Ehc CunvartioS Act, 1956. US share* are istod on Bombay Stock Exchange in India. ThE Company is snogged in manuraclunng and sellng of a repuled brand "LEHAK" fool wears In domestic market.

2 Basis of Preparation

The financial statements of (he company have been prepared in accordance with generaly accepted accounting policies in 3rK)ia (Ind^n GAAP} The Company has prepared (hew fnyncial sUHomenls Lo comply n all mytchal respects with the accounting standards notified under tne Companies {Accounting Standards) Rules, 2006. fas amended) and the relevant provisions of the Companies Act, 1956. The Financial statements have been prepared on an accrual basis under tne historical cost contention, expect toe land and building acquired before :il March 20D5 which are earned at revalued amounts

The aoountmg policies adopted In tne preparation of financial statements are In consistency wllh those of previous years.

3 Dlsctosure under AS-15 (KwtssdJ—Employee Benefits

PTOvfelon has been made fo* employe*? beneftts araluHy. leave encashment and other benefits In accordance wlm AS-lA (Reprised) an ina basis or actuarial wsJuaLlo
Gratuity and Leave Encashment

The inlryfflnQ mbln fwls jj*H Itin ulaHjp nfttifl rinrfmnTri gratuity plnn nncl cfcjfjn*d leawj cnrflshnnail plan>

4 SogiTHnt InfotmaUon

T h*: Board of Olfeciors
Ralattrd Party DltclosufB*

Tho Campany has made? tho rodotNlng transactions with related parties as defined under the- provisions of Acoounig

5 Previous yeafs figures nava Dean regrouped and rearranged wtie^ever considered necessary. Figures are rounded nFF to ihe nearest rupee.


Mar 31, 2010

1. Contingent Liabilities not provided for:

a) income Tax Demand of Rs. 1,04,433/-for the assessment year 2005-06 against which the company has filed an appeal with higher authority. 0) Estimated amount of Contracts remaining to be executed on capital account not provided for Rs. Nil (Previous Year: Nil).

2. Book debts, advances, creditors, unsecured loans, deposits from customers etc. have been taken at their book value and are subject to confirmations and reconciliation.

3. Loans and advances and debtors have been considered good and in respect of which the company holds no security other than the personal guarantee of the person concerned.

4. Provision of Income tax has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with Section 115JB of the Income Tax Act. 1961. Considering the future profitability and taxable positions in the subsequent years, the company has recognized MAT Credit Entitlement of Rs. 13.85,988/- as an assets by crediting to the Profit and Loss Account and included under Loans and Advances in accordance with the guidance note on Accounting for credit available In respect of Minimum Alternate Tax under Income Tax Act. 1961 issued by the Institute of Chartered Accountants of India.

5. Disclosure under AS-15 (Revised) -Employee Benefits

Provision has been made for employee benefits gratuity, leave encashment and other benefits In accordance with AS-15 (Revised) on the basis of actuarial valuation.

a) Provident Fund

Retirement benefit in the form of Provident Fund is defined contribution scheme and the contributions are charged to Profit & Loss Nc of the year when the contributions to the respective fund are due. There is no other obligation other than the contribution payable to the respective trusts.

6. Seament Reporting - AS 17 The Board of Directors of the Company considers and maintains Footwear as the only Business Segment of the Company.

7. Related Party Transactions - AS 18

The Company has made the fallowing transactions with related parties as defined under the provisions of Accounting Standard-18 issued by the Institute of Chartered Accountants of India.

8. During the year 2006-07 government of India has promulgated an Act namely "The Micro, Small 8 Medium Enterprises Development Act 2006 which comes into force with effect from October 2, 2006. As per the act, the company is required to Identity the Micro & Small Enterprises & pay them interest on over due beyond the specified period irrespective of the terms agreed with the enterprises. The company has initiated the process of identification of such suppliers. in view of No. of suppliers & no receipt of critical Inputs & response from several such potential parties, the liability of Interest cannot be reliable estimated nor can required disclosure be made. Accounting in the regard will be carried out after process is complete and reliable estimate can be made in this regard Since the company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability.

9. Some of the Vehicles are in the name of the directors, which are yet to be transferred.

10. Capital Work in Progress includes Advence for Showroom Rs. 1,12,20,895(Previous Year Rs. 89,27,803).

11. a) There had occurred a fire on 24.02,2008 at the registered office 8 factory premises of the company, during the year under review the Insurance Company has passed the claim of the company and there is a shortfall of Rs. 1,86,74.521 against the said claim. No provision is made for the same, as the company has not accepted the assessment of loss from insurances companies and has invoked the arbitration clause of the insurance contract and company is of opinion that they will receive the balance amount of Rs. 1,86,74,521 from the insurance companies.

b) The Company also holds "Loss of Profit policy and the company has lodged its claim of Rs. 140.89 Lacs against this policy during the month of May 2009 but assessment of loss is under process with surveyor, therefore, the company has decided to take no effect of Loss of Profit policy in current year results, and accounting for the same will be dona after assessment of loss by the surveyor. c) There had occurred a fire on 26-10-2009 at the leased unit of the company at F-263, Road No. 13, VKl Area, Jaipur. The leased unit of the company was fully Insured by the Oriental Insurance Company Ltd, the loss of Rs 148.49 lacs w.r.t. Stock and Rs. 24,18 lacs w.r.t. Fixed Assets has been debited to appropriate accounts. The surveyor has assessed Rs. 123.27 Lacs agaist claim for stock and the same has been debited to the Oriental Insurance Company Ltd .shown under the head Loans and Advances In the Balance Sheet, and balance of Rs. 25.22 Lacs has booked as Loss by Fire. The assessment of loss for fixed assets is under process

12. Sundry Creditors include Re. 71.40.063 (Previous Year 46.75,297) due to small scale industrial undertaking to the extent such parties have been Identified from available Information and Rs. 25182307- (Previous Year 10566081 )due to the creditors other than small scale industrial undertaking. The company has agreement of payment within 120 days with Small Scale Industries suppliers, and there is no outstanding amount above 120 days. Therefore, there is no need to make provision for interest due to SSI Suppliers.

13. The Company has partially deployed the IPO Proceeds as per the offer document and revised capital expenditure plan as passed is last AGM. Balance Proceeds will be utilized in the next financial year in accordance with the details as per offer document and revised capital expenditure program. Pending such utilization. Unutilized money has been deposited with bank as FDR or given as Inter Corporate Deposit to corporates for short term on interest.

14. Previous years figures have been regrouped and rearranged wherever considered necessary.


Mar 31, 2009

1. Contingent Liabilities not provided for:

a) Income Tax Demand of Rs. 1,04,433/-f or the assessment year 2005-06 against which the company has filed an appeal with higher authority.

b) Estimated amount of Contracts remaining to be^ejcecuted on capital account not provided for Rs. Nil (Previous Year. 145.47 lacs).

2. Book debts, advances, creditors, unsecured loans, deposits from customers etc. have been taken at their book value and are subject to confirmations and reconciliation.

3. Loans and advances and debtors have been considered good and in respect of which the company holds no security otner than the personal guarantee of the person concerned.

4. Provision of income tax has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with Section 115JBof the Income Tax ACT 1961. Considering the future profitability and taxable positions in the subsequent years, the company has recognized MAT Credit Entitlement of Rs. 76,688/- as an assets by crediting to the Profit and Loss Account an equivalent amount and included under Loans and Advances in accordance with the guidance note on Accounting for credit available in respect of Minimum Alternate Tax under Income Tax Act, 1961 issued by the Institute of Chartered Accountants of India.

5. Disclosure under AS-15 (Revised) Employee Benefits Provision has been made for employee benefits gratuity, leave encashment and other benefits in accordance with AS-15 (Revised) on the basis of actuarial valuation.

a) Provident Fund

Retirement benefit in the form of Provident Fund is defined contribution scheme and the contributions are charged to Profit & Loss A/c of the year when the contributions to the respective fund are due. There is no other obligation other than the contribution payable to the respective trusts.

b) Gratuity and Leave Encashment

The following table sets out the status of the defined gratuity plan and defined leave encashment plan:-

6 Segment Reporting AS17

The Board of Directors of the Company considers and maintains Footwear as the only Business Segme?. *jf the Company.

7. Related Parly Transactions AS 18

The Company has made the following transactions with related parties as defined under the provisions of Accounting Standard-18 issued by the Institute of Chartered Accountants of India.

List of related parties along with the nature and volume of transaction is given below from 01.04.2008 to 31.03.2009.

8. During the year 2006-07 government of India has promulgated an Act namely "The Micro, Small & Medium Enterpnses Development Act" 2006 which comes into force with effect from October 2,2006. As per the act, the company is required to identify the Micro & Small Enterprises & pay them interest on over due beyond the specified period irrespective of the terms agreed with the enterprises. The company has initiated the process of identification ol such suppliers. In view of No. of suppliers & no receipt of critical inputs & response from several such potential parties, the liability of interest cannot be reliable estimated nor can required disclosure be made. Accounting in theregard will be carried out after process is complete and reliable estimate can pe made in this regard. Since the company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability.

9. Some of the Vehicles are in the name of the directors, which are yet to be transferred.

10. Capital Work in Progress includes Advance for Office Rs. 60,96,140 (Previous Year Rs. 55,97,756) & Advance for Showroom Rs. 69,27,603 (Previous YearRs. 83,99.054).

11. a) There had occurred a fire on 24.02.2006 at the Registered office and factory premises of the company. Stock worth Rs. 409.26 Lacs was destroyed in fire. The Company has lodged claim towards this loss (Based on Reinstatement Cost). The said claim is under process with the Insurance Company and Rs. 49.88 Lacs have been received from the Insurance company and the balance is to be received after finalization of this insurance claim. The company has debited this amount of Rs. 409.26 lacs to insurance Claim Receivable Account and balance of Rs. 359.37 lacs and has shown the same under the head Current Assets in the Balance Sheet.

a) The Company also hoids "Loss of Profit policy and the company has lodged its claim of Rs. 140.89 Lacs against this policy during the month of May 2009, however, because of uncertainty attached with the amount of claim the company has decided to take no effect of Loss of Profit policy in current year results. Accounting for the same wilt be done after passage of the same by the Insurance Company.

b) Certain items of Plant & Machinery, Building and othe* assetswere also destroyed in the fire. The company is fully insured against such loss and the insurance policy is based on "Reinstatement Cost". The company has lodged claim towards this ioss(Based on Reinstatement Cost). The said less is under process with insurance company and pending finalization of this insurance claim. The above claim has debited in Insurance Claim receivable and shown the same under the head Current Assets in the balance sheet.

12. Additional information pursuant to the paragraphs 3 and 4 of part II of the schedule VI of companies Act, 1956 is NIL or none except to the extent gven below:

13. Sundry Creditors include Rs. 4675297/- (Previous Year S164329) due to small scale industrial undertaking to the extent such parties have been identified from available information and Rs. 25182307/- (Previous Year 10566081) due to the creditors other than small scale Industrial undertaking. The company has agreement of payment within 120 days with Small Scale Industries suppliers, and there Is no outstanding amount above 120 days. Therefore, there is no need to make provision for interest due to SSI Suppliers.

14. During the year the company has sold 2% shares of its subsidiary company Lawreshwar Footcare P. Ltd., reducing its shareholding to 49% in the said company. Hence, w.e.f. 1* April, 2008 Lawreshwar Footcare P. Ltd does not remain a subsidiary of Lawreshwar Polymers Limited and w.e.f. 1* April, 2008 there exists a lease agreement with Lawreshwar Footcare P. Ltd. & all terms and conditions of lease agreement are duly signed by authorized persons and payment of lease rent and interest has been made as per agreement.

15. The Company has partially deployed the IPO Proceeds as per the offer document and revised capital expenditure plan as passed is last AGM. Balance Proceeds will be utilized in the next financial year in accordance with the details as per offer document and revised capital expenditure program. Pending such utilization, Unutilized money has been deposited with bank as FDR or given as Inter Corporate Deposit to corporates for short term on interest.

16. The Company has taken factory Land & Building of Lawreshwar Footcare Pvt. Ltd. (Including Plant & Machinery, Furniture & fitting, therein as applicable) under operating lease agreement. This Is non cancelable for a period of 10 (Ten) years and is renewable by mutual consent on mutually agreeable terms. The Company has given refundable interest free security deposit in accordance with the agreed terms. The lease payments amounting to Rs. 9,60,000/- (Previous year Rs. Nil) are recognized in the profit & loss A/c under manufacturing expenses under schedule 14.

17. Previous years figures have been regrouped and rearranged wherever considered necessary.

18. Figures are rounded off to the nearest rupee.

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