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Notes to Accounts of Lippi Systems Ltd.

Mar 31, 2015

1. Rights, Preferences and Restrictions Attached to each class of shares

The Company has only one class of Equity Shares having a par value of Rs. 10/- per share and each holder of the Equity Shares is entitled to one vote per share.

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no preferential amounts exist currently. The distribution will be in proportion to the number of shares held by the shareholders.

2. Details of Loans:

i Outstanding Term loan of Rs. 289.34 Lakhs (including an amount of Rs. 64.32 Lakhs classified under current maturities of long term debt) relates to acquisition of 0.75 MW windmill and other indigenous machinery. It is secured by the hypothecation of the P&M acquired from the said loan.The loan is repayable in 60 graded monthly installments and is expected to be repaid by September, 2018.

II. Outstanding Term loan of Rs. 42.19 Lakhs (including an amount of Rs. 13.50 Lakhs classified under current maturities of long term debt) relates to acquisition indigenous plant and machinery. It is secured by the hypothecation of the P8tM acquired from the said loan. The loan is repayable in 60 equal monthly installments of Rs. 1.125 Lakhs each and is expected to be repaid by October, 2018.

III. Indian Overseas Bank has sanctioned term loan of Rs. 97.5 Lakhs, (o/s Rs. 11.79 Lakhs as on March 31, 2015) for the purchase of imported plant and machinery costing Rs. 130 Lakhs. The said term loan is repayable in 60 equal monthly installments of Rs. 1,62,500 each and is expected to be repaid by July, 2018. The loan is proposed with buyers credit facility for a period of 3 years, hence the loan installments to be placed as recurring deposit every month. On completion of 36 months, loan to be disbursed, less margin and TL installments built-up during the preceding 36 months. The outstanding term loan is secured by the hypothecation of the P&M acquired from the said loan. The company has also availed Buyers Credit facility of Rs. 42.63 Lakhs fortheimport of copper.

"The company has provided the following as collateral securities for the above loans and working capital facilities:

(a) Equitable mortgage followed by registered memorandum on Factory Land & Building situated at 540/P-2, Village Rakanpur Sola, Satej Road, Kalol in the name of the Company, (b) Plant & Machinery and other Misc. Assets of the Company and (c) Freehold NA Land at village Ranchodpura, Taluka Kalol in the name of Satya Prakash Infrastructure Pvt. Ltd. Further the loans are backed by the personal guarantee of Shri Nandlal Agrawal, Shri Sanjay Agrawal and Shri Kunal Agrawal."

iv. The outstanding vehicle loans of Rs. 9.48 Lacs (classified under current maturities of long term debt) are secured against hypothecation of the respective vehicles. The total outstanding is expected to be repaid by October, 2015.

3. The Cash Credit facilities have been secured against hypothecation of stocks and book debts of the company present and future & the entire current assets of the company. For details on securities offered as collateral, refer note 3.1.

4. MAT CREDIT ENTITLEMENT:

Based on the assessment of the future taxable income, the Management is of the opinion that there is convincing evidence that the company will pay normal income tax within the specified period during which MAT credit is available forset off.

5. CONTINGENT LIABILITIES AND COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account (Net of Advances) is for Rs. 1,51,621 ( Rs. 2,43,318)

6. The company has made provision in the accounts for gratuity based on acturial valuation. The particulars under the AS 15 (Revised) furnished below are those which are relevant and available to company for this year.

7. In the opinion of the management and to the best of their knowledge and belief, the value underthe head of current and non-current assets (otherthan fixed assets and non- current investments) are approximately of the value stated, if realised in ordinary course of business, except unless stated otherwise. The provision for all known liabilities is adequate and not in excess of amount considered reasonably necessary.

8. The company is organised into two main business segments, namely production of engraving cylinders and trading of copper and paper. The Company is also generating power from wind turbine generator. Wind mill is not a reportable segment as per AS 17 "Segment Reporting" as the power generated by wind mill is exclusively used for captive consumption in manufacturing unit. The disclosures regarding the segment information is as follows

9. RELATED PARTY DISCLOSURES:

As per the Accounting Standard 18, disclosure of transactions with related parties (as identified by the management), as defined in the Accounting Standard are given below:

10 Amt. in Rs.

RELATIONSHIP 2014-15 2013-14

1. Holding Company: Nil Nil

2. Subsidiary Company: Nil Nil

3. Key Managerial personnel & their relatives :

Mr. Nandlal Agarwal, (Managing Director)

Mr. Sanjay C. Agrawal, Non-Executive Director

Mr. Kunal N. Agarwal, Director

Mr. Minesh C. Shah, Director

Ms. Neha N Agrawal, Director (upto 14/04/2015)

Mrs. Shashi Gupta, Relative of Director

Mr. Gopalkrishna D. Sharma, Chief Financial Officer

Mr.Darshan B. Shah, Company Secretary

11. There are no earnings in foreign currency in financial year 2014-15. (Previous year NIL)

12. The Previous year figures have been regrouped / reclassified, wherever necessary to conform to the current year presentation, further the figures have been rounded off to the nearest rupee.


Mar 31, 2014

1.SHARE CAPITAL

(b) Rights, Preferences and Restricts ons Attached to each class of shares The Company has only one class of Equity Shares having a par value of Rs. 10/- per share and each holder of the Equity Shares is entitled one vote per share.

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive any of the remaining assets of the company, after distribution of ail preferential ! amounts. However, no preferential amounts exist currently. The distribution will be in proportion to the number of shares held by the shareholders. ''

1.1 Details of Loans:

i. Outstanding Term loan of Rs. 323.63 Lacs (including an amount of Rs. 45.90 Lacs classified under current maturity of long term borrowings) relates to acquisition of 0.75 MW windmill and other indigenous machinery. It is secured by the hypothecation of the P&M acquired from the said loan.The loan in repayable in 60 graded monthly installments and is expected to be repaid by September, 2018.

ii. Outstanding Term loan of Rs. 54.56 Lacs (including an amount of Rs. 13.50 Lacs classified under current maturity of long term borrowings) relates to acquisition indigenous plant and machinery. It is secured by the hypothecation of the P&M acquired from the said loan. The loan in repayable in 60 equal monthly installments of Rs. 1.125 Lacs each and is expected to be reapid by October, 2018.

iii. Indian Overseas Bank has sanctioned term loan of Rs. 97.5 Lacs, (o/s Rs. 15.29 Lacs as on March 31,2014) for the purchase of imported plant and machinery costing Rs. 130 Lacs. The said term loan is repayable in 60 monthly installments of Rs. 1,62,500 each and is expected to be repaid by July, 2018. The loan is proposed with buyers credit facility for a period of 3 years and the loan installments to be placed as term deposits every month. On completion of 36 months, loan to be disbursed, less margin and TL installments built-up during the preceding 36 months. The outstanding term loan is secured by the hypothecation of the P&M acquired from the said loan.

"The company has provided the following as collateral securities for the above loans and working capital facilities:

(a) Equitable mortgage followed by registered memorandum on Factory Land & Building situated at 540/P-2, Village Rakanpur Sola, Satej Road, Kalol in the name of the Company, (b) Plant & Machinery and other Misc. Assets of the Company and (c) NA Land at Milage Ranchodpura in the name of Satya Prakash Infrastructure Pvt. Ltd. Further the loans are backed by the personal guarantee of Shri Nandial Agrawal & Shri Sanjay Agrawal along with corporate guarantee of Satya Prakash Infrastructure Pvt. Ltd."

iv. The outstanding vehicle loans of Rs. 41.84 Lacs (including an amount of Rs. 32.36 Lacs classified undercurrent maturity of long term borrowings) are securedagainsthypothecationof the respective vehicles. The total outstanding is expected to be repaid by October, 2015.

2.1 The Cash Credit facilities have been secured against hypothecation of stocks and book debts of the company present and future & the entire current assets of the company. For collateral securities offered, refer point 3.1.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of the information collected by the management. This has been relied upon by the auditors.

3.1 Other Payables include the statutory dues and advance from customers.

4.1 MAT CREDIT ENTITLEMENT:

Based on the assessment of the future taxable income, the Management is of the opinion that there is convincing evidence that the company will pay norma! income tax within the specified period during which MAT credit is availa ble for set off.

5. CONTINGENT LIABILITIES AND COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account (Net of Advances) is for Rs. 2,43,318 ( Rs. 6,15,088)

5.1 The company has made provision in the accounts for gratuity based on acturial valuation. The particulars under the AS 15 (Revised) furnished below are those which are relevant and available to company for this year.

The estimates of future salary increase, considered in act uarial valuation, takes account of inflation, seniority, promotion and other relevant factors, such as supply and demand in employment market. .

6. In the opinion of the management and to the best of their knowledge and belief the value underthe head of current and non-current assets (other than fixed assets and non- current investments) are approximately of the value stated, if realised in ordinary course of business, except unless stated otherwise. The provision for all known liabilities is adequate and not in excess of amount considered reasona bly necessary.

7. There are no earnings in foreign currency in financial year 2013-14. (Previous year NIL)

8. The Previous year figures have been regrouped / reclassified, wherever necessary to conform to the current year presentation, further the figures have been rounded off to the nearest rupee.


Mar 31, 2013

1.1 The company has made provision in the accounts for gratuity based on acturial valuation. The particulars under the AS 15 (Revised) furnished below are those which are relevant and available to company for this year.

The estimates of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors, such as supply and demand in employment market.

Current and non current classification is done based on actuarial valuation certificate.

2. In the opinion of the management and to the best of their knowledge and belief, the value under the head of current and non-current assets (other than fixed assets and non- current investments) are approximately of the value stated, if realised in ordinary course of business, except unless stated otherwise. The provision for all known liabilities is adequate and not in excess of amount considered reasonably necessary.

3. The company is organised into two main business segments, namely production of engraving cylinders and trading of copper and paper. The disclosures regarding the segment information is asfollows:

4. The previous year figures have been regrouped / reclassified, wherever necessary to conform to the current year presentation. Further the figures have been rounded off to the nearest rupee.

 
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