Notes to Accounts of Mallcom (India) Ltd.

Mar 31, 2018

1. Corporate Information

"Mallcom (India) Limited (""the Company"") is a public limited company domiciled in India and is incorporated in the year 1983 under Companies Act applicable in India. Its shares are listed on one recognized stock exchanges in India. The registered office of the company is located at EN-12, Sector-V, Salt Lake, Kolkata- 700091, India. The company is one of the established manufacturers -exporter of Personal Protective Equipments. It has a long track record in the Industrial Safety Products category. These financial statements are approved and adopted by the Board Of Directors of the Company in their meeting dated 30th May, 2018."

2. Statement of Compliance and Recent Pronouncements

2.1 Statement of Compliance

The financial statements of the company have been prepared in accordance with India Accounting Standards [Ind As) notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended by the Companies (Indian Accounting Standards)(Amendment), Rules, 2016. For all periods up to and including the period ended 31st March, 2017, the company prepared its financial statements in accordance with accounting standards notified under the section 133 of the Companies (Accounts) Rules, 2014 (Indian GAAP). These Financial statements for the year ended 31st March, 2018 are the first Ind AS financial statements. Refer Note 42 for information on how the company adopted Ind As.

The Company had adopted change in its accounting year in terms of section 2(41) of the Companies Act, 2013 from 01.04.2017.

In accordance with Ind AS 101-“First Time adoption of Indian Accounting Standards" (Ind AS 101), the Company has presented (Note No. 49), a reconciliation of Shareholders’ equity as given earlier under Previous GAAP and those considered in these accounts as per Ind AS as at April 01, 2016, and March 31, 2017 and also the Net Profit as per Previous GAAP and that arrived including Other Comprehensive Income under Ind AS for the year ended March 31, 2017.The mandatory exceptions and optional exemptions availed by the Company on First time adoption have been detailed in Note No. 49(2] of the financial statement.

2.2 Recent Pronouncements

On March 28, 2018, Ministry of Corporate Affairs ("MCA") has issued the Companies (Indian Accounting Standards) Amendment Rules, 2018 notifying Ind AS 115, "Revenue from Contract with Customers" and Appendix B to Ind AS 21 "Foreign currency transactions and advance consideration” which are applicable with effect from financial periods beginning on or after 1st April, 2018. Ind AS 115 - Revenue from Contract with Customers The standard requires that an entity should recognize revenue to depict the transfer of promised goods or services to customers for an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts with customers. The effect of this amendment on the financial statements of the Company is being evaluated.

Ind AS 21 - Appendix B "Foreign currency transactions and advance consideration”

This Appendix applies to a foreign currency transaction (or part of it) when an entity recognises a non-monetary asset or non-monetary liability arising from the payment or receipt of advance consideration before the entity recognises the related asset, expense or income (or part of it). The effect of this amendment on the financial statements of the Company is being evaluated

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

2.4 In the event of liquidation of the 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.

2.5 As no fresh issue or reduction in capital was made during the current year as well as during the previous period, hence there is no change in the opening and closing capital. Accordingly, reconciliation of share capital has not been given.

2.6 Agreegate number of bonus shares issued, shares issued for consideration other than cash and bought back shares during the period of five years immediately preceeding the reporting date:

NOTE 3. OTHER EQUITY

Nature of Reserves Capital Reserve

Capital Reserve represents the amount, being the purchase price lower then the fair market value of the capital assets acquired by the company and used for the purposes of its business.

Securities Premium Reserve

Securities Premium Reserve represents the amount received in excess of par value of equity shares of the company. The same, interalia, may be utilized by the company to issue fully paid-up bonus shares to its members and buying back the shares in accordance with the provisions of the companies Act, 2013.

General Reserve

General Reserve represents the reserve created by apportionment of profit generated during the year or transfer from other reserves either voluntary or pursuant to statutory requirements. The same is a free reserve and available for distribution.

Retained Earnings

Retained Earnings represents the undistributed profits of the company.

3.1 Demand loans from banks are secured by hypothecation of all present/future stock and receivables, all present/future fixed assets (excluding Land & Building) and personal guarantee of Managing Director

3.2 There is no default in repayment of principal and interest thereon

(b) Defined Benefit Plan

Gratuity - The company has defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary] for each completed year of service. The scheme is funded with HDFC Standard Life Insuarance Co Ltd.

The estimates of future salary increases have been considered in actuarial after taking into consideration the impact of inflation, Seniority, promotion and other relevant factors such as supply and demand situation in the employment market. Same assumptions were considered for comparative period i.e 2016-17 as considered in previous GAAP on transition to Ind AS. The Gratuity Scheme is invested in group Gratuity cash accumulation policy offered by HDFC Standard Life Insuarance Co Ltd. The gratuity plan is not exposed to any significant risk in view of absolute track record, Investment is as per IRDA guidelines and mechanism is there to monitor the performance of the fund.

NOTE 4. SEGMENT REPORTING

(A) The Company’s primary business segment is Industrial Safety Products. The Industrial Safety Products business incorporates product groups’ viz. Leather hand Gloves, Industrial Work Garments, Seamless Knitted Gloves, Leather Shoe Upper, Safety Shoes and Nitrile Dipped Gloves, which mainly have similar risks and returns. Thus, the Company’s business activity falls within a single primary business segment.

(B) For the purpose of geographical segments, total sales are divided into India and other countries. The following table shows the distribution of the company''s sales by geographical market regardless of where the goods are produced:

* Post-employment benefits and other long-term benefits have been disclosed based on actual payment made on retirement/resignation of services, but does not includes provision made on actuarial basis as the same is available for all the employees together

Fair Valuation Techniques

The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer in an orderly transaction between market participants at the measurement date.

The following methods and assumptions were used to estimate the fair values:

The fair value of cash and cash equivalents, current trade receivables and payables, current financial liabilities and assets and borrowings approximate their carrying amount largely due to the short-term nature of these instruments. The management considers that the carrying amounts of financial assets and financial liabilities recognised at nominal cost/amortised cost in the financial statements approximate their fair values.

A substantial portion of the company''s long-term debt has been contracted at floating rates of interest, which are reser at short intervals. Fair value of variable interest rate borrowings approximates their carrying value subject to adjustments made for transaction cost. In respect of fixed interest rate borrowings, fair value is determined by using discount rates that reflects the present borrowing rate of the company.

Investments (Other than Investments in Associates, Joint Venture and Subsidiaries) traded in active market are determined by reference to the quotes from the stock exchanges as at the reporting date. Investments in liquid and short-term mutual funds are measured using quoted market prices at the reporting date multiplied by the quantity held. Quoted Investments for which quotations are not available have been included in the market value at the face value/paid up value, whichever is lower except in case of debentures, bonds and government securities where the net present value at current yield to maturity have been considered. Unquoted investments in shares have been valued based on the historical net asset value as per the latest audited financial statements.

Derivative financial assets and liabilities:

The Company follows established risk management policies, including the use of derivatives to hedge its exposure to foreign fluctuations on foreign currency assets/liabilities. The counter party in these derivative instruments is a bank and the company considers the risks of non-performance by the counter party as non-material.

FINANCIAL RISK FACTORS

The Company''s activities and exposed to variety of financial risks. The key financial risks includes market risk, credit risk and liquidity risk. The Company''s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The board of Directors reviews and approves policies for managing these risks. The risks are goverened by appropriate policies and procedures and accordingly financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives.

MARKET RISK

Market risk is the risk or uncertainty arising from possible market fluctuations resulting in variation in the fair value of future cash flows of a financial instruments. The major components of Market risks are currency risk, interest rate risk and other price risk. Financial instruments affected by market risk includes trade receivables, borrowings, investments and trade and other payables.

Foreign Currency Risk

Foreign Currency risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s foreign currency denominated borrowings, trade receivables and trade or other payables.

The Company has adopted a comprehensive risk management review system wherein it actively hedges its foreign exchange exposures within defined parameters through use of hedging instruments such as forward contracts. The Company periodically reviews its risk management initiatives and also takes experts advice on regular basis on hedging strategey.

Interest Rate Risk

The company''s exposure in market risk relating to change in interest rate primarily arises from floating rate borrowing with banks and financial institutions. Borrowings at fixed interest rate exposes the company to the fair value interest rate risk.

Other price risk

The Company''s equity exposure in Subsidiaries are carried at cost or deemed cost and these are subject to impairment testing as per the policy followed in this respect. The company''s current investments which are fair valued through profit and loss are not material. Accordingly, other price risk of the financial instrument to which the company is exposed is not expected to be material.

CREDIT RISK

credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables]. The management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. The company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends and ageing of accounts receivable. Individual risk limits are set accordingly and the company obtains necessary security including letter of credits and/or bank guarantee to mitigate.

The carrying amount of respective financial assets recognised in the financial statements, (net of impairment losses] represents the company''s maximum exposure to credit risk. The concentration of credit risk is limited due to the customer base being large and unrelated. Of the trade receivable balance at the end of the year (other than subsidiaries), there are no single customer accounted for more than 10% of the accounts receivable and 10% of revenue as at March 31, 2018 and March 31, 2017

LIQUIDITY RISK

Liquidity risk is defined as the risk that the company will not be able to settle or meet its obligations on time or at a reasonable price. The Company''s objective is to maintain optimum level of liquidity to meet it''s cash and collateral requirements at all times. The company''s assets represented by financial instruments comprising of receivables are largely funded against borrowed funds. The company relies on borrowings and internal accruals to meet its fund requirements. The current committed line of credit are sufficient to meet its short to medium term fund requirement.

NOTE 5. LEASE

In case of asset taken on lease:

Operating Lease:

The company has taken certain premises on lease for 3 years to 99 years. There are no subleases.

NOTE 6. MICRO, SMALL AND MEDIUM ENTERPRISES

There were no dues outstanding to the suppliers as on 31.03.2018 registered under the Micro, Small and Medium Enterprises (Development) Act, 2006, to the extent such parties have been identified from the available documents/ information. No interest in terms of such Act has either been paid or provided during the year.

NOTE 7 : In the opinion of the management and to the best of their knowledge and belief, the value of realization of loans and advances and other current assets in the ordinary course of business will not be less than the amount at which they are stated in the Balance Sheet

NOTE 8. Provisions of Section 135 of the Companies Act, 2013 relating to Corporate, Social Responsibility (CSR) is applicable in case of the company. The Company was required to incur a minimum amount of Rs. 23,15,453/- (Rs. 18,29,685) being two percent of average net profits of the company made during the three immediately preceding financial years as calculated as per section 198 of the Companies Act, 2013. The company has incurred a sum of Rs.20,06,536/- in the year and plans to contribute the remaining amount of CSR expenditures Rs.18,28,664/- during the current financial year.

NOTE 9. Figures less than 50,000 have been shown actual, wherever statutorily required to be disclosed, as the figures have been rounded off to the nearest Lakhs.

NOTE 10. The Board of Directors has recommended dividend of Rs.2/- per equity (previous year Rs.2/-) of Rs.10/- each for the year ended 31st March, 2018

NOTE 11: FIRST TIME ADOPTION OF Ind As- Disclosures, Reconciliation etc.

a) FIRST-TIME ADOPTION - Mandatory Exceptions and optional Exemptions

These financial statements are covered by Ind AS 101, "First Time Adoption of Indian Accounting Standards", as they are the company''s first Ind AS financial statements for the year ended March 31, 2018.

i) Overall principle:

a) The company has prepared the opening balance sheet as per Ind AS as at April 1, 2016 (the transition date) by recognising all assets and liabilities whose recognition is required by Ind AS, not recognising items of assets or liabilities which are not permitted by Ind AS, by reclassifying certain items from Previous GAAP to Ind AS as required under the IndAS, and applying Ind AS in the measurement of recognised assets and liabilities. The accounting policies that the company used in its opening Ind-AS Balance Sheet may have differed from those that it used for its previous GAAP. The resulting adjustments arising from events and transactions occurring before the date of transition to Ind-AS has been recognised directly in retained earnings at the date of transition.

b) However, this principle is subject to certain mandatory exceptions and certain optional exemptions availed by the company as detailed below.

ii) Derecognition of financial assets and financial liabilities

The company has applied the derecognition requirements of financial assets and financial liabilities prospectively for transactions occurring on or after April 1, 2016 (the transition date).

iii) Fair Value as deemed cost for Property, Plant and Equipment

Property, plant and equipment has been carried in accordance with previous GAAP carrying value as deemed cost at the date of transition excepting freehold land and buildings valued at Fair value at the date of transition, which has been considered as deemed cost.

iv) Deemed cost for Intangible assets

The company has elected to continue with the carrying value of all of its intangible assets recognised as of transition date measured as per the Previous GAAP and used that carrying value as its deemed cost as of the transition date.

v) Impairment of financial assets

Ind AS 109 "Financial Instruments” requires the impairment to be carried out retrospectively; however, as permitted by Ind AS 101, the company has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognised in order to compare it with the credit risk at the transition date. Further, the company has not undertaken an exhaustive search for information when determining, at the date of transition to Ind AS, whether there have been significant increases in credit risk since initial recognition, as permitted by Ind AS 101.

vi) Determining whether an arrangement contains a lease

The company as on the date of transition complied with Ind AS 17 "Leases” to determine whether an arrangement contains a Lease on the basis of facts and circumstances existing at the date of transition to Ind AS, accordingly leasehold land has been reclassified as operating lease.

c) Explanatory Notes to reconciliation between Previous GAAP and Ind AS

(i) Property, Plant and Equipment

The company has used previous GAAP carrying value as deemed cost of Property, Plant and Equipment(PPE)

(ii) Accounting of Leasehold Property

Under the previous GAAP, leasehold land was shown at a carrying value consisting ofthe initial costs incurred and was amortised over the period of lease.

Under Ind AS 101, the Company has recognised the same as its carrying value.

(iii) Fair Valuation of financial assets and liabilities

Under the previous GAAP, receivables and payables were measured at transaction cost less allowances for recoverability, if any. Under Ind AS, financial assets and liabilities are initially recognised at fair value and subsequently measured at amortised cost using the effective interest rate method, less allowances for impairment, if any. The resulting changes are recognised either under finance incomeor expenses in the Statement of profit and loss.

(iv) Fair valuation of Current Investment

Under previous GAAP, Current investments were measured at lower of cost or market price.

Under Ind AS, these investment are measured at fair value through profit or loss and accordingly, difference between the fair value and carrying value is recognised in Statement of profit or loss.

On transition, the Company has recognised a gain of Rs.5.11 Lakhs as on March 31, 2017 in respect of bonds and investments with corresponding increase in total equity.

(v) Fair Valuation of Derivative Instruments

Under previous GAAP, exchange difference arising with respect to forward contracts other than those entered into to hedge foreign currency risk on unexecuted firm contracts or of highly probable forecast transactions were recognised in the period in which they arise and the difference between the forward contract and exchange rate at the date of transaction is recognised as revenue/expense over the life of the contract.

In respect of derivative instruments (other than forward contracts dealt as above) premium paid, gain/losses on settlement and losses on restatement were recognised in the statement of profit and loss except in case they relate to acquisition or construction of fixed assets, in which case they were adjusted to the cost of fixed assets/capital work in progress.

Under Ind AS, both reductions and increases to the fair value of derivative contracts that is either not designated as a hedge or is so designated but is ineffective are recognised in statement of Profit and Loss. Changes in fair value of the derivative hedging instrument designated as a cash flow hedge are recognised in OCI.

No Adjustment was required in case of the company.

(vi) Borrowings

Under previous GAAP, transaction costs incurred in connection with borrowings are accounted upfront and charged to Statement of profit and loss in the year in which such costs were incurred.

Under Ind AS, Finance Liabilities consisting of Long Term Borrowings are to be fair valued and designated and measured at amortised cost based on Effective Interest Rate (EIR) method. The transaction costs so incurred are required to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in Statement of profit and loss over the tenure of the borrowing as part of the interest expense by applying EIR.

(vii) Taxation

Deferred tax has been recognised in respect of on accounting differences between previous GAAP and Ind AS. These adjustments have resulted increase in deferred tax liability and decrease in equity by Rs.1.64 lakhs and Rs.3.97 lakhs as on March 31, 2018 and March 31,2017 respectively.

(viii) Proposed Dividend and related Corporate Dividend Tax

Under previous GAAP, in accordance with "Contingencies and Events occuring after the Balance Sheet Date", proposed dividend as recommended by the Board of Directors was recognised as liability in the period to which they relate irrespective of the approval of the shareholders.

Under Ind AS, such dividends are recognised as liability in the period in which they are approved by the shareholders or paid. On transition, the company has derecognised proposed dividend and dividend tax amounting to NIL for the year ended March 31, 2017 and April 1, 2016 respectively as it was subsequently approved by the Shareholders.

(ix) Remeasurement of Defined Benefit Plan

Under previous GAAP and Ind AS, the Company recognises cost related to its post-employment defined benefit plan on an actuarial basis.

Under previous GAAP, the entire costs including re-measurement are charged to Statement of profit and loss. Under Ind AS, the actuarial gain and losses from part of remeasurements net defined benefit liability/asset which is recognised in OCI.

Consequently, the tax effect on the same has also been recognised in OCI instead of statement of profit and loss.

Under Ind AS, the entity is permitted to transfer amounts recognised in the Other Comprehensive Income within equity. The Company has taken recourse of the said provision and has transferred all re-measurement costs recognised relating prior to the transition date from retained earnings as on the date of transition as permitted under Ind AS.

On transition, this has resulted in reclassification of re-measurement losses on defined benefit plans of Rs.6.63 lakhs for the year ended March 31, 2017 from Statement of profit and loss to OCI.

x) Previous GAAP figures have been reclassifed/recompanyed wherever necessary to confirm with financial statements prepared under Ind AS.

b) Reconciliation in terms of Ind AS 101 "First time adoption of Indian Accounting Standards"

1) Reconciliation of Balance Sheet as at 01.04.2016

9) Footnotes to the reconciliation of equity as at 01.04.2016 and 31.03.2017 and Profit or loss for the period ended 31.03.2017:]

a) Financial Assets at Fair Value Through Profit or Loss (FVTPL)

Under Indian GAAP, the company accounted for current investments at lower of cost or market value. Under Ind AS, the company has designed these investments as financial assets measured at fair value through profit or loss. Ind AS requires that investment designed at FVTPL, are measured at fair value. At the date of transition to Ind AS, difference between fair value and the Indian GAAP carrying value has been recognized in retained earnings. Subsequent to the date of transition to Ind AS, fair value gain or loss has been recognized to statement of profit and loss.

b) Defined Benefit Liabilities

Both under Indian GAAP and Ind AS, the company recognized costs related to post employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire costs, including actuarial gains and losses, are charged to statement of profit and Loss. Under Ind AS, remeasurements (comprising of actuarial gains or losses, the effect of the asset celing, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts included in net defined benefit liability) are recognized immediately in the balance sheet with a corresponding debit or credit to retained earnings through Other Comprehensive Income. Thus, the remeasurement gain of Rs.4.34 Lakhs on defined benefit plan has been recognized in the other comprehensive income, net of tax.

c) Provisions

Under Indian GAAP, the company has accounted for provisions, including long term provisions, at the undiscounted amount. In contrast, Ind AS 37 requires that where the effect of time value of money is material, the amount of provision should be the present value of the expenditures expected to be required to settle the obligation. The discount rates should not reflect risk for which future cash flow estimates have been adjusted. Ind AS 37 also provides that where discounting is used, the carrying amount of a provision increases in each period to reflect the passage of time.

d) Deferred Tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12- Income Taxes requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of asset or liability in the balance sheet and its corresponding tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP.

In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the company has to account for such differences. Deferred tax adjustments are recognized in correlation to the underlying transaction either in retained earnings or a separate component of equity.

e) Sale of goods

"Under Indian GAAP, sale of goods was presented as net of excise duty. However, Under Ind AS, Sale of goods includes excise duty.

Excise duty on sale of goods is separately presented on the face of statement of Profit and Loss accordingly, Sale of goods under Ind As for the Period ended 31.03.2017 has increased by Rs.340.89 Lakhs."

f) Statement of Cash Flows

The impact of transition from Indian GAAP to Ind AS on the statement of Cash Flows is due to various reclassification adjustments recorded under Ind AS in balance sheet, Statement of Profit and Loss and differences in the definition of cash and cash equivalents in Ind AS and Indian GAAP.

g) Borrowings

Under the Indian GAAP, transaction costs incurred in connection with borrowings are charged upfront to statement of Profit and Loss for the year. Under Ind AS, transaction costs are included in the initial recognition amount of financial liability and charged to statement of Profit and Loss using effective interest method.

h) Other Comprehensive Income

Under Indian GAAP, the company has not presented Other Comprehensive Income [OCI] separately. Hence it has reconciled Indian GAAP profit or loss to profit or loss as per Ind AS. Further, Indian GAAP profit or loss is reconciled to total comprehensive income as per Ind AS.

i) Proposed Dividend and Tax on Proposed Dividend

Under Indian GAAP, proposed dividends including tax on proposed dividend are recognized as liability in the period to which they relate, irrespective of the approval by shareholders. Under Ind AS, proposed dividend is recognized as a liability in the period in which it is declared by the company (when approved by shareholders in a general meeting) or paid.

NOTE: 12 These financial statements have been approved by the Board of Directors of the Company on 30th May, 2018 for issue to the shareholders for their adoption.

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Mar 31, 2016

1. 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 or equity shares is entitled to one vote per share.

In the event of liquidation of the company. the holders of equity share will be entailed 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. shareholders are entitled for dividend if any declared by the Company. During the year dividend payout of Rs. 2.00(P.Y. Rs.1.50) per equity share of Rs. 10/- each is proposed.

The company has issued 34.20.000 shares as fully paid Bonus Shares since incorporation.

2. Segment Reporting

Based on the & guiding principles given in Accounting Standard on 5egment Reporting. (AS-17.1. the Company''s primary business segment Is Industrial Safely products;. Thy Industrial Safety Products business Incorporate product groups'' viz. Leather hand Gloves. Industrial Work Garments. Seamless Knitted Gloves. Leather Shoe Upper, Safely Shoes and Nitrite Dipped Gloves. which mainly have similar risks and returns. Thus the Company''s business activity falls within 3 single primary business segment.

For The purpose of geographical segments total sales are divided into India and other countries, The following table shows the distribution of the company''s sates by geographical market regardless of where the goods 3re produced:

3. Lease

In case of asset taken on lease :

Operating Lease:

The company has taken certain premises on tease for 3 years to 99 years There are no subleases.

4. Trade Payables includes USD 1,267,929 (INR 82,801,872) Previous Year USD 101.228(INR 6,335,873which is naturally hedged against export receivables.

5. Micro Small and Medium Enterprises

There were no dues outstanding to the suppliers as on 31.03.2016 registered under the Micro. Small and Med um Enterprises Development Act, 2006, to the extent such parties have been identified from the available document/information. No interest in terms. of such Act has. either been paid or provided during the year.

6. In The opinion of the management and lo the best of their knowledge and belief, the value of realization of loans and advances and other current assets in the ordinary cutes of business will nut he less than the amount at which they are stated in the Balance Sheet.

7. During the year, the company has -increase its slake from 32.15$ Id 99.005; in Mallcom VSFT gloves Private Limited.

8. Raw Materials, Chemicals and Packing Materials Consumption

9. Estimated amount of Contracts remaining to tie e-exclude on capital account and not provided for Rs. Nil (Rs 95.15 lakhs).

10. Remittance in Foreign Currency on account of Dividend 10 Non Resident Shareholder

11. The Company has a defined benefit gratuity plan. Every employee ^ho has completed five years or more of service is enticed to Gratuity as per provisions of The Payment to Gratuity Act. 1972. The scheme is funded through approved gratuity trust and is managed by HDFC Stanford Life Insurance Co Ltd.

12. The following tables summaries the components as net benefit expenses recognized in the Statement of Profit & Loss and the funded status and amounts recognized in the balance sheet for the Gratuity.

13. Table Showing Changes in Present Value of Obligations

14. During the year the company has changed its Accounting Policy relating to provision for Leave Encashment and has provided a sum of Rs.32.12 lakhs as per the actuarial valuation report obtained in terms to AS-15. This will have impact of reducing the profit for the year by the equivalent amount.

15. Provisions of Section 135 of the Companies Act. 2013 relating to Corporals. Social Responsibility (CSR) is applicable in case of the company. The Company wa.5 required to incur a minimum amount of Rs.13,72.999 being two percent of average net profits of the company made during the three immediately preceding financial years as calculated as per section 190 of the Companies Act. 2013. The company however plans to contribute the CSR expend tunes at above during the current financial year

16. Previous Year''s figures haw been regrouped/ rearranged wherever considered necessary.

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Mar 31, 2015

1. Corporate Information

Mallcom (India) Ltd., domiciled in India, was incorporated in the year 1983 under Companies Act 1956. The company is one of the established manufacturer - exporter of Personal Protective Equipments. It has a long track record in the Industrial Safety Products category.

2. 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 the company, the holders of equity share 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. Shareholders are entitled for dividend if any declared by the Company. During the year dividend payout of Rs.1.50 (P.Y. Rs. 1.50) per equity share of Rs.10/-each is proposed.

3. Change in accounting estimate

Effective 01st April 2014, the company has revised the Depreciation rates of fixed assets, according to the useful lives specified in Schedule -II of the Companies Act, 2013, resulting into increase in depreciation charge for the year by Rs 103.27 lakhs.

Further written down value of the assets whose useful live has already been exhausted before 1st April 2014 amounting to Rs. 78 lakhs (net of deferred tax) have been adjusted against the retained earnings as on 1st April 2014.

4. Related Party Transactions

(a) Subsidiaries and Associates i) Mallcom Safety Pvt. Ltd [MSPL]

ii) Mallcom Safety Equipment Pvt. Ltd [MSEPL]

iii) Mallcom VSFT Gloves Pvt. Ltd [VSFT]

iv) Kadambini Securities Pvt. Ltd [KSPL]

v) Mallcom Holdings Pvt. Ltd [MHPL]

vi) Movers Construction Pvt. Ltd [MCPL]

vii) Chaturbujh Impex Pvt. Ltd [CIPL]

viii) DNB Exim Pvt. Ltd. [DNB]

ix) Two Star Tannery Private Limited [TSTPL]

(b) Key Managerial Personnel i) Mr. Ajay Kumar Mall (Managing Director)

(c) Relatives of Key Managerial Personnel i) Mr. S.K.Mall

ii) Mrs Sunita Mall

5. Segment Reporting

Based on the guiding principles given in Accounting Standard on Segment Reporting, (AS-17), the Company's primary business segment is Industrial Safety Products. The Industrial Safety Products business incorporates product groups' viz. Leather hand Gloves, Industrial Work Garments, Seamless Knitted Gloves, Leather Shoe Upper, Safety Shoes and Nitrile Dipped Gloves, which mainly have similar risks and returns. Thus the Company's business activity falls within a single primary business segment.

For the purpose of geographical segments, total sales are divided into India and other countries. The following table shows the distribution of the company's sales by geographical market regardless of where the goods are produced:

6.a. Contingent liabilities not provided for: Amount in (Rs.)

Contingent Liabilities

Amount in (Rs.)

Particulars 31-Mar-2015 31-Mar-2014

Export bills duly discounted/ negotiated under LC and for which acceptance already received and/or moved to bank line (previous year figures relates to Bill drawn under LC only). 129,266,880 66,310,258

Outstanding Bank guarantee issued by State bank of India Nil 1,00,000

B-17 Bond issued in favor of "Asst. Commissioner of Central Excise, Calcutta" covering the purchase of imported / indigenous capital goods/ raw materials without payment of Custom duty/ Excise Duty with respect to 00% E.O.U. for seamless knitted gloves 25,000,000 25,000,000

B-17 Bond issued in favor of "Deputy Commissioner of Customs, FSEZ", covering the purchase of imported / indigenous capital goods/ raw materials without payment of Custom duty/ Excise Duty with respect to 100% SEZ unit 31,000,000 31,000,000

Sales Tax demand in respect of earlier years, which has been disputed by the Company 8,006,000 8,006,000

Income Tax Demand in respect of earlier years, which has been disputed by the company 17,957,840 11,949,510

7. Micro Small and Medium Enterprises

There were no dues outstanding to the suppliers as on 31.03.2015 registered under the Micro, Small and Medium Enterprises (Development) Act, 2006, to the extent such parties have been identified from the available documents/ information. No interest in terms of such Act has either been paid or provided during the year.

8. In the opinion of the management and to the best of their knowledge and belief, the value of realization of loans and advances and other current assets in the ordinary course of business will not be less than the amount at which they are stated in the Balance Sheet.

9. During the year, Mallcom VSFT Gloves Private Limited has become subsidiary of the company with effect from 31st March 2015.

10. Estimated amount of Contracts remaining to be executed on capital account and not provided for Rs. 95.15 lacs (P.Y Rs 245.08 lacs)

11. Based on market quotation as on 31st March, 2015 there is a diminution in the value of certain non current investments aggregating to Rs. 78,336 (Previous Year Rs. 103,522). However considering the future prospects of the companies the management has considered the diminution to be temporary requiring no provisions.

12. Previous Year's Figures have been regrouped/ rearranged wherever considered necessary.

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Mar 31, 2014

1.1 Related party transaction

List of Related Party and Relationships:

Mallcom Safety Pvt. Ltd [MSPL] : 100% Subsidiary

Kadambini Securities Pvt. Ltd [KSPL] : Associate

Mallcom Holdings Pvt. Ltd [MHPL] : Associate

Mallcom Safety Equipment Pvt.Ltd [MSEPL] : Subsidiary

Movers Construction Pvt.Ltd [MCPL] : Associate

Chaturbujh Impex Pvt.Ltd [CIPL] : Associate

Sri Ajay Kumar Mall : Key Managerial Person

1.2 Previous Year's Figures have been regrouped/ rearranged wherever considered necessary.

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Mar 31, 2013

1. 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 the company, the holders of equity share 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. Shareholders are entitled for dividend if any declared by the Company. During the year dividend payout of Rs.1.20/equity shares of Rs.10/-each is prosposed.

2. The company has issued 34,20,000 shares as fully paid Bonus Shares since incorporation, however has not bought any shares during the period of five year immediately preceeding the pervious year

3. There is no micro, small and medium enterprises, to which company owes any amount outstanding more than forty five days as at 31st March 2013. This information as required to be disclosed under the micro, small and medium enterprises development Act 2006, has been determined to the extent such parties have been identified on the basis of information available to the company;

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Mar 31, 2012

1 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 the company, the holders of equity share 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. Shareholders are entitled for dividend if any declared by the Company. During the year dividend payout of Rs.1.20/equity shares of Rs.10/-each is prosposed'

2. The company has issued 34,20,000 shares as fully paid Bonus Shares since incorporation, however has not bought any shares during the period of five year immediately preceeding the pervious year

Export Packing Credit/ Packing Credit Foreign Currency Loan [a b]

[Secured by hypothecation of all present/future stock and receivables , all prresent/future fixed assets (excluding Land & Building) & Corporate and Personal guarantee of MD)

Bank Overdraft [C]

[From Axis Bank against pledge of Fixed Deposits]

There is no micro, small and medium enterprises, to which company owes any amount outstanding more than forty five days as at 31st March, 2012. This information as required to be disclosed under the micro, small and medium enterprises development Act 2006, has been determined to the extent such parties have been identified on the basis of information available to the company;