Notes to Accounts of NRB Bearings Ltd.

Mar 31, 2023

Provisions, Contingent Liabilities and contingent Assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event,
it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and
a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material,
provisions are discounted using equivalent period government securities interest rate. Unwinding of the discount is
recognised in the standalone statement of profit and loss as a finance cost. Provisions are reviewed at each balance
sheet date and are adjusted to reflect the current best estimate.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which
will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within
the control of the Company or a present obligation that arises from past events where it is either not probable that
an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made. Information
on contingent liabilities is disclosed in the Notes to the standalone financial statements. Contingent assets are not
recognised, but disclosed in the standalone financial statements. However, when the realisation of income is virtually
certain, then the related asset is no longer a contingent asset, but it is recognised as an asset.

t. Employee Benefits

A) Short term employee benefits: All employee benefits payable within twelve months from the end of the period
in which services are rendered are classified as short term employee benefits. Benefits such as salaries, wages, short
term compensated absences, etc. and the expected cost of bonus, ex-gratia are recognised in the period in which the
employee renders the related service.

B) Post employment benefits

i. Defined contribution plans: The company''s superannuation scheme, state governed provident fund and family
pension scheme are defined contribution plans. The contribution paid/ payable under the schemes, is recognised
during the period in which the employee renders the related service.

Provident Fund and family pension fund are charged to the standalone statement of profit and loss as incurred.
The Company''s contribution to the statutory provident fund and family pension fund is determined based on a fixed

percentage of the eligible employees'' salary and charged to the standalone statement of profit and loss on accrual
basis. The Company does not have any obligation other than the contribution made to the fund administered by the
government.

ii. Gratuity: The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible
employees. The plan is governed by the Payment of Gratuity Act, 1972 and provides lumpsum payment to eligible
employees at retirement, death while in employment or termination of the employment of an amount equivalent to 15
days salary payable for each completed year of service. The Company has established two trusts, one each for its staff
and officers and makes contributions to such funds for funding these plans.

The Company has computed its liability towards future payments of gratuity to employees, on actuarial valuation basis
which is determined based on project unit credit method and the charge for current year is debited to the standalone
statement of profit and loss. Actuarial gains and losses arising on the measurement of defined benefit obligation and
experience adjustments are charged/ credited to other comprehensive income. All other costs/reversals are recognised
in the standalone statement of profit and loss.

C) Compensated absences: The Company provides for the encashment of leave or leave with pay subject to
certain rules. The employees are entitled to accumulate leave subject to certain limits for future encashment/ailment.
The Company makes provision for compensated absences based on an actuarial valuation by an actuary, using the
projected unit credit method. Actuarial gains and losses arising on the measurement of defined benefit obligation is
charged/ credited to the Statement of Profit and loss. The Company presents the entire leave as a current liability in
the balance sheet, since it does not have an unconditional right to defer its settlement for 12 months after the reporting
date.

u. Exceptional Items

When items of income and expense within standalone statement of profit and loss from ordinary activities are of such
size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the period,
the nature and amount of such material items are disclosed separately as exceptional items.

v. Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss (excluding other comprehensive income) for
the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the
year. The weighted average number of equity shares outstanding during the year is adjusted for events such as bonus
issue, bonus element in a right issue, shares split and reverse share splits (consolidation of shares) that have changed
the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating
diluted earnings per share, the net profit or loss (excluding other comprehensive income) for the year attributable to
equity share holders and the weighted average number of shares outstanding during the year are adjusted for the
effects of all dilutive potential equity shares.

w. Operating cycle and classification of current and non - current items

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and
their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the
purpose of classification of its assets and liabilities as current and non-current.

(i) An asset is considered as current when it is:

a. Expected to be realised or intended to be sold or consumed in the normal operating cycle, or

b. Held primarily for the purpose of trading, or

c. Expected to be realised within twelve months after the reporting period, or

d. Cash or cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve
months after the reporting period.

(ii) All other assets are classified as non-current.

(iii) Liability is considered as current when it is:

a. Expected to be settled in the normal operating cycle, or

b. Held primarily for the purpose of trading, or

c. Due to be settled within twelve months after the reporting period, or

d. There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting
period.

(iv) All other liabilities are classified as non-current.

x. Contributed equity

Equity shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of
tax, from the proceeds.

y. Export Incentives

Export entitlement from government authority are recognised in the profit or loss as other operating revenue when the
right to receive is established as per the terms of the scheme in respect of the exports made by the Company with no
future related cost and where there is no significant uncertainty regarding the ultimate collection of the relevant export
proceeds.

z. Critical estimates and judgements

The preparation of standalone financial statements in conformity with Ind AS which requires management to make
estimates, assumptions and exercise judgement in applying the accounting policies that affect the reported amount of
assets, liabilities and disclosure of contingent liabilities at the date of standalone financial statements and the reported
amounts of income and expenses during the year.

The management believes that these estimates are prudent and reasonable and are based upon the management''s
best knowledge of current events and actions. Actual results could differ from these estimates and differences between
actual results and estimates are recognised in the periods in which the results are known or materialised.

This note provides an overview of the areas that involved a comparatively higher degree of judgement or complexity,
and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be
different than those originally assessed.

i) Property, plant and equipment, Investment properties and Intangible assets:

Property, plant and equipment represents a significant proportion of the asset base of the Company. The change
in respect of periodic depreciation is derived after determining an estimate of an assets expected useful life and
the expected residual value at the end of its life. The useful lives and residual values of the Company''s assets are
determined by the management at the time the asset is acquired and reviewed periodically, including at each financial
year end. The lives are based on historical experience with similar assets as well as anticipation of future events, which
may impact their life, such as changes in technology.

ii) Income Tax:

Significant judgments are involved in determining the provision for income taxes, including the amount expected to be
paid or recovered in connection with uncertain tax positions.

iii) Contingencies:

Management has estimated the possible outflow of resources at the end of each annual reporting financial year, if any,
in respect of contingencies / claim / litigations by / against the Company as it is not possible to predict the outcome of
pending matters with accuracy.

iv) Expected credit loss on financial assets:

On application of Ind AS 109, the impairment provisions of financial assets are based on assumptions about risk of
default and expected timing of collection. The Company uses judgments in making these assumptions and selecting the
inputs to the impairment calculation, based on the Company''s past history of collections, customer''s credit-worthiness,
existing market conditions as well as forward looking estimates at the end of each reporting period.

v) Deferred Taxes:

Deferred tax is recorded on temporary differences between the tax bases of assets and liabilities and their carrying
amounts, at the rates that have been enacted or substantively enacted at the reporting date. The ultimate realisation
of deferred tax assets is dependent upon the generation of future taxable profits during the periods in which those
temporary differences and tax loss carry forwards become deductible. The Company considers the expected reversal of
deferred tax liabilities and projected future taxable income in making this assessment. The amount of the deferred tax
assets considered realisable, however, could be reduced in the near term if estimates of future taxable income during
the carry forward period are reduced.

vi) Impairment of financial assets:

At each balance sheet date, based on historical default rates observed over expected life, existing market conditions
as well as forward looking estimates, the management assesses the expected credit losses on outstanding receivables.
Further, management also considers the factors that may influence the credit risk of its customer base, including the
default risk associated with industry and country in which the customer operates."

vii) Impairment of non financial assets:

Where the carrying amount of an asset or CGU exceeds its recoverable amount (fair value less costs of disposal or its
value in use), the asset is considered impaired and is written down to its recoverable amount. In assessing value in
use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset. In determining fair value
less cost of disposal, recent market transactions are taken into account. If no such transactions can be identified, an
appropriate valuation model is used. These calculations are corroborated by valuation multiples or other available fair
value indicators.

viii) Defined benefit obligation:

The cost of the defined benefit plans, compensated absences and the present value of the defined benefit obligations
are based on actuarial valuation using the projected unit credit method. An actuarial valuation involves making various
assumptions that may differ from actual developments in the future. These include the determination of the discount
rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term
nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed
at each reporting date.

ix) Leases:

Determining the lease term of contracts with renewal and termination options - Company as lessee Ind AS 116
requires the lessee to determine the lease term as the non-cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option
to terminate the lease, if it is reasonably certain not to be exercised.

The Company has several lease contracts that include extension and termination options. The Company applies
judgement in evaluating whether it is reasonably certain whether or not to exercise the option to renew or terminate
the lease. That is, it considers all relevant factors that create an economic incentive for it to exercise either the renewal
or termination. After the commencement date, the Company reassesses the lease term if there is a significant event
or change in circumstances that is within its control and affects its ability to exercise or not to exercise the option to
renew or to terminate (e.g., construction of significant leasehold improvements or significant customisation to the
leased asset).When it is reasonably certain to exercise extension option and not to exercise termination option, the
Company includes such extended term and ignore termination option in determination of lease term.

The Company cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing
rate (IBR) to measure lease liabilities. The Company has taken indicative rates from its bankers and used them for Ind
AS 116 calculation purposes.

x) Provisions:

Provision is recognised when the Company has a present obligation as a result of past event and it is probable that
an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can me made.
Provisions (excluding retirement obligation and compensated expenses) are not discounted to its present value and
are determined based on best estimate required to settle obligation at the balance sheet date. These are reviewed at
each balance sheet date adjusted to reflect the current best estimates.

xi) Fair value measurements:

Management applies valuation techniques to determine fair value of financial assets and liabilities (where active market
quotes are not available). This involves developing estimates and assumptions around volatility and dividend yield etc.
which may affect the value of financial assets and liabilities. Estimates and judgements are continuously evaluated.
These are based on historical experience and other factors including expectation of future events that may have a
financial impact on the Company and that are believed to be reasonable under the circumstances.

xii) Impairments of assets:

In assessing impairment, management estimates the recoverable amounts of each asset (in case of non-financial
assets) based on expected future cash flows and uses an interest rate to discount them. Estimation uncertainty relates
to assumptions about future cash flows and the determination of a suitable discount rate.

2 Recent accounting pronouncements

The Ministry of Corporate Affairs had vide notification dated 23 March 2022 notified Companies (Indian Accounting
Standards) Amendment Rules, 2022 which amended certain accounting standards, and are effective 1 April 2022.
These amendments did not have any impact on the amounts recognised in prior periods and are not expected to
significantly affect the current or future periods, as below :

i. Ind AS 1 - Presentation of Financial Statements:

The amendments require companies to disclose their material accounting policies rather than their significant
accounting policies. Accounting policy information, together with other information, is material when it can reasonably
be expected to influence decisions of primary users of general purpose financial statements. The Company does not
expect this amendment to have any significant impact in its standalone financial statements."

ii. Ind AS 12 - Income Taxes:

The amendments clarify how companies account for deferred tax on transactions such as leases and decommissioning
obligations. The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind
AS 12 (recognition exemption) so that it no longer applies to transactions that, on initial recognition, give rise to
equal taxable and deductible temporary differences. The Company is evaluating the impact, if any, in its standalone
financial statements.

iii. Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors:

The amendments will help entities to distinguish between accounting policies and accounting estimates. The
definition of a change in accounting estimates has been replaced with a definition of accounting estimates. Under the
new definition, accounting estimates are "monetary amounts in standalone financial statements that are subject to
measurement uncertainty". Entities develop accounting estimates if accounting policies require items in standalone
financial statements to be measured in a way that involves measurement uncertainty. The Company does not expect
this amendment to have any significant impact in its standalone financial statements.

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Mar 31, 2018

1 Corporate Information

NRB Bearings Limited (‘the Company’) is a public limited company domiciled and incorporated in India in 1965. The registered and corporate office of the company is situated at Dhannur, 15, Sir P. M. Road, Fort, Mumbai 400 001, Maharashtra. The company is engaged in the manufacture of ball and roller bearings.

The separate financial statements were authorised for issue in accordance with the resolution of the directors on 21 May 2018.

Basis of Preparation

The Company has prepared its financial statements to comply in all material respects with the provisions of the Companies Act, 2013 (the Act) and rules framed thereunder and the guidelines issued by Securities and Exchange Board of India. In accordance with the notification issued by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 under Section 133 of the Act, with effect from 1 April 2017. Till 31 March 2017, the Company used to prepare its financial statements as per Companies (Accounting Standards) Rules, 2014 (Previous GAAP) read with rule 7 and other relevant provisions of the Act. These are the first Ind AS Financial Statements of the Company. The transition from Previous GAAP to Ind AS has been accounted for in accordance with Ind AS 101 “First Time Adoption of Indian Accounting Standards”, with 1 April 2016 being the transition date and balance for the comparative period have been restated accordingly. AS per Ind As 101, the Company has presented a reconciliation of its transition Previous GAAP to Ind AS of its total equity as at 1 April 2016 and 31 March 2017 and reconciliation of total comprehensive income and cash flow for the year ended 31 March 2017. Please refer note 48 for detailed information on the transition.

The financial statements have been prepared on a historical cost convention and accrual basis, except for the following assets and liabilities:

i) Certain financial assets and liabilities that are measured at fair value

ii) Defined benefit plans-plan assets measured at fair value

2.1 Estimation of fair value of investment properties:

The fair valuation is based on current prices in the active market for similar properties. The main inputs used are quantum, area, location, demand, age of building and trend of fair market rent, ready reckoner rate etc. This fair value is based on valuations performed by an accredited independent valuer. The fair value measurement is categorised in level 2 fair value hierarchy.

2.2 The carrying value as at 1 April, 2016 as per previous GAAP of the Investment Properties is considered as a deemed cost on the date of transition.

(ii) Rights attached to equity shares:

a) Right to receive dividend as may be approved by the Board / Annual General Meeting.

b) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

c) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to speak and on a show of hands, has one vote if he is present in person and on a poll shall have the right to vote in proportion to his share of the paid-up capital of the Company.

Nature and purpose of reserves

i) Capital Redemption Reserve

It is created on account of merger and the same will be utilised in accordance with the provision of Companies Act 2013

ii) Securities Premium Reserve

Securities premium is used to record the premium received on issue of shares. The amount will be utilised in accordance with the provisions of the Companies Act, 2013

iii) Debenture Redemption Reserve

The Company had issued non convertible debentures and accordingly Debenture redemption reserve is required to be created pursuant to the Companies (Share capital and debentures) Rules 2014. The same will be utilised in accordance with the provision of Companies Act 2013

iv) General Reserve

General Reserve is created from time to time by way of transfer of profits from retained earnings for appropriation purpose. This reserve is a distributable reserve.

v) Retained Earnings

Retained earnings represents the accumulated profits / losses made by the Company over the years.

vi) Fair Value Gain on Equity Instruments through OCI

The Company has elected to recognise changes in the fair value of equity investments in Other Comprehensive Income. These changes are accumulated within the FVOCI equity investment reserves within equity and will be transferred to retained earnings on derecognition of these equity instruments.

The Company has not received any intimation from the suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 hence disclosures, if any, relating to amounts unpaid as at the year end together with interest paid/ payable as required under the said Act have been made on the basis of information available with the Company. Management believes that figures for disclosure, if any, will not be significant.

Footnotes:

i. There is no amount outstanding and due as at the balance sheet date to be credited to the Investor Education and Protection Fund.

ii. Represents interim dividend declared by the Board of Directors at their meeting dated 20 March 2018.

Note:

Excise duty on sales was included under Revenue from operations and disclosed separately under Expenses upto 30 June 2017. Post implementation of Goods and Services Tax (GST) from 1 July 2017, revenue from operations is reported net of GST and hence to that extent sale of products for the year end 31 March 2018 are not comparable.

I. Fair value hierarchy

The fair value of the financial assets and liabilities is included at the amount that would be received on selling an asset or paid on transferring a liability in an orderly transaction between market participants on the measurement date.

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair value is disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. For example, listed equity instruments that have quoted market price.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the- counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

During the periods mentioned above, there have been no transfers amongst the levels of hierarchy.

II. Valuation techniques used to determine fair value

Significant valuation techniques used to value financial instruments include:

The fair value for investment in equity instrument and mutual fund is based on the quoted market prices. Fair value of security deposits, loans is based on discounted cash flows using a discount rate determined considering company’s incremental borrowing rate. Non current borrowings are fair valued using effective interest rates.

Fair valuation of interest rate swap and foreign currency option contracts are calculated on the basis of estimated mid-market levels, estimated bid-side or offer side levels, or on the basis of indicative bid or offer or unwind prices or on such other appropriate basis. It is derived from other proprietary or other pricing models based on certain assumptions.

Fair valuation of forward exchange contracts is determined using forward exchange rates on the balance sheet date.

The carrying amounts of Trade receivables, cash and cash equivalent, other bank balances, current investments, short term loans, other current financial assets, short term borrowings, trade payables, other current financial liabilities are considered to be approximately equal to the fair value.

III. Valuation Process

The finance department performs the calculations of financial assets and liabilities required for financial reporting purposes. This team reports directly to the chief financial officer (CFO). Discussions of valuation processes and results are held at least once every three months, in line with the quarterly reporting periods.

3 Financial risk management

The Company’s principal financial liabilities comprise borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables, investments and cash and cash equivalents that are derived directly from its operations.

The Company is exposed to credit risk, market risk and liquidity risk. The Company’s senior management oversees the management of these risks.

A Credit risk

The company is exposed to credit risk from its operating activities (primarily for trade receivables) and from its financing activities (deposits with banks and other financial instruments).

Credit risk management

To manage credit risk, the Company follows a policy of providing 0-90 days credit on the basis of nature of customers. The credit limit policy is established considering the current economic trends of the industry and geographies in which the company is operating.

However, the trade receivables are monitored on a periodic basis for assessing any significant risk of nonrecoverability of dues and provision is created accordingly.

Bank balances and deposits are held with only high rated banks and majority of other security deposits are placed majorly with government agencies/public sector undertakings. .

B Liquidity risk

Liquidity risk is the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. This risk arises from obligations on account of the Company’s financial liabilities such as borrowings, trade payables etc.

The Company’s corporate finance department is responsible for liquidity and funding management and settlement. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company’s net liquidity position through rolling forecasts on the basis of expected cash flows.

The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments at each reporting date:

C Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: Foreign currency risk, interest rate risk and price risk.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk on their receivables, payables and other financial obligations which are denominated in USD, EUR, Thai Baht, CHF and JPY. The fluctuation in the exchange rate of INR relative to these currencies may have a material impact on the company’s assets and liabilities.

Foreign currency risk management

In respect of the foreign currency transactions, the company hedges substantial exposure via forward contracts and foreign currency options, remaining exposures are unhedged since the management believes that the same is insignificant in nature and also it will be offset by the corresponding receivables and payables which will be in the nature of natural hedge.

Sensitivity to foreign currency risk

The following table demonstrates the sensitivity in above currencies with all other variables held constant. The below impact on the Company’s profit before tax is based on changes in the fair value of unhedged foreign currency monetary assets and liabilities at balance sheet date:

Sensitivity analysis to foreign currency risk includes an exposure to foreign exchange fluctuations on long term foreign currency loans of $37 lakhs equivalent to Rs. 2,404.72 lakhs (31 March 2017 - $82.42 lakhs equivalent to Rs. 5,343.75 lakhs) that have been capitalised into the cost of the related assets and are expected to impact profit or loss over a period of 7 to 11 years in the form of adjustment to the depreciation charge.

(ii) Cash flow and fair value interest rate risk

The company’s interest rate risk is mainly due to the long term borrowing acquired at floating interest rate. The Company’s policy is to maintain most of its borrowing at fixed rate using interest rate swaps to hedge the exposure. During the year ended 31 March 2018 and 31 March 2017, the Company’s borrowing at variable rate were mainly denominated in USD.

The fixed rate borrowing is carried at amortised cost, hence it is not subject to interest rate risk since the carrying amount and future cash flows will not fluctuate because of change in market interest rates.

(iii) Price Risk

The Company is exposed to price risk from its investment in equity instruments measured at fair value through other comprehensive income and mutual fund measured at fair value through profit and loss.

4 Capital Management

A Risk management

The Company’s objectives when managing capital are to

- safeguard it’s ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders, and

- maintain an optimal capital structure to reduce the cost of capital.

The Company monitors its capital by using gearing ratio, which is net debt divided by total equity. Net debt includes non-current and current borrowings net of cash and bank balances and total equity comprises of equity share capital, security premium, general reserve, other comprehensive income and retained earnings.

C Loan covenants

With respect to the borrowings, there are standard covenants in the loan agreements between the lenders and the Company. These covenants are monitored by the Company on a regular basis. There has been no default on the financial convenants or on the loans by the Company.

Dividends not recognised at the end of the reporting period

In addition to the above dividends, since year end the directors have recommended the payment of a final dividend of Rs. 1.2 per fully paid equity share (31 March 2017 - Rs. Nil). This proposed dividend is subject to the approval of shareholders in the ensuing annual general meeting.

5 Related Party Disclosure:

As per Ind AS 24 “Related party Disclosures”, disclosure of transactions with the related parties as defined in the Accounting Standard are given below:

Footnote:

i) No amounts pertaining to related parties have been provided for as doubtful debts. Further, no amounts have either been written off or written back during the year.

ii) Dividend paid/received has not been considered by the Company as a transaction falling under the purview of Accounting Standard 18 “Related Party Disclosures”.

iii) The guarantee given towards the borrowings availed by the subsidiary company was for the purpose of local sourcing of capital goods.

6 Employee benefits

As per Indian Accounting Standard-19 ‘Employee Benefits’, the disclosure of Employee benefits as defined in the Standard are given below:

(B) Defined Benefit Plan :

(1) Contribution to Gratuity fund (funded scheme)

In accordance with Indian Accounting Standard 19, actuarial valuation was done in respect of the aforesaid defined benefit plan of gratuity based on the following assumptions:-

x Senstivity Analysis:

Significant actuarial assumptions for the detemination of the defined benefit obligation are discount rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the assumptions occurring at the end of the reporting period, while holding all other assumptions constant. The results of sensitivity analysis is given below:

xii General descriptions of Significant Defined plans:

The Company operates a gratuity plan wherein every employee is entitled to the benefit as per scheme of the Company, for each completed year of service. The same is payable on retirement or termination whichever is earlier. The benefit vests only after five years of continuous service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

xiii Other Long Term Benefits:

Compensated absences recognized in the Statement of profit and loss for the current year, under the employee cost in Note 34, is Rs. 175.65 lakhs (31 March 2017 Rs. 139.44 lakhs).

7 Segment reporting

In accordance with Ind AS 108- ‘Operating Segment’, segment information has been given in the Consolidated Financial Statements of the Company, therefore, no separate disclosure on Segment information is given in these Financial Statements.

8 First time adoption of Ind AS A First Ind AS Financial statements

These are the Company’s first separate financial statements prepared in accordance with Ind AS applicable as at 31 March 2018.

The accounting policies set out in note 1 have been applied in preparing the financial statements for the year ended 31 March 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 1 April 2016 (the date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2014 and other relevant provisions of the Act (previous GAAP or Indian GAAP).

An explanation of how the transition from previous GAAP to Ind AS has affected the company’s financial position, financial performance and cash flows is as follows:

i) Optional exemptions availed Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind aS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets and investment property covered by Ind AS 40 Investment Property.

Accordingly, the company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their previous GAAP carrying value.

Business combinations

Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combination prior to the transition date.

The company has availed the business combination exemption on first time adoption of Ind AS and accordingly the business combinations prior to date of transition have not been restated to the accounting prescribed under Ind AS 103 - Business combinations.

The company applies the requirements of Ind AS 103 - Business combinations to business combinations occurring after the date of transition to Ind AS

Investment in subsidiaries

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its subsidiaries as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition.

Accordingly, the company has elected to measure all of its investments in subsidiaries at their previous GAAP carrying value.

Long term foreign currency monetary items

A first time adopter may continue the policy adopted for accounting for exchange differences arising from translations of long-term foreign currency monetory items recognised in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period as per the previous GAAP.

Accordingly, the company has elected to continue the current accoounting policy adopted for accounting of exchange differences arising from translation of long-term foreign currency monetory items.

ii) Mandatory exceptions applied Estimates

An entity’s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP except where Ind AS required a different basis for estimates as compared to the previous GAAP.

De-recognition offinancial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a firsttime adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions.

The company has applied the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

The company has classified its financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

Government loans

As per Ind AS 101, If a first-time adopter did not, under its previous GAAP, recognise and measure a government loan at a below-market rate of interest on a basis consistent with Ind AS requirements, it shall use its previous GAAP carrying amount of the loan at the date of transition to Ind AS the carrying amount of the loan in the opening Ind AS balance sheet. An entity shall apply Ind AS 101 to the measurement of such loans after the date of transition to Ind AS.

The Company has applied the above exeption for it’s deferred sales tax loan and accounted the loan at it’s previous GAAP carrying value.

9 Lease rentals

The Company has taken certain vehicles on operating lease. Lease rental charged to the statement of profit and loss for the year ended 31 March 2018 Rs. 69.30 lakhs (31 March 2017 - Rs. 69.30 lakhs). The minimum lease payments to be made in future as at the year end, in respect of non-cancellable lease are follows:

Note:

The Company does not have any outstanding dilutive potential equity shares as at 31 March 2018 and 31 March 2017. Consequently, basic and diluted earnings per share of the Company remains the same.

Notes 1 to 51 form an integral part of the financial statements

This is the summary of significant accounting policies and other explanatory information referred to in our report of even date.

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Mar 31, 2017

1. Rights attached to equity shares:

2. Right to receive dividend as may be approved by the Board / Annual General Meeting.

3. The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

4. Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to speak and on a show of hands, has one vote if he is present in person and on a poll shall have the right to vote in proportion to his share of the paid- up capital of the Company.

5- Disclosures under the Micro, Small and Medium Enterprises Development Act, 2006:

6. No amounts were due and outstanding to suppliers as at the end of the accounting year on account of Principal and Interest.

7. No interest was paid during the year in terms of section 16 of the Micro, Small and Medium Enterprises Development Act, 2006 and no amount was paid to the supplier beyond the appointed day.

8. No amount of interest is due and payable for the period of delay in making payment but without adding the interest specified under the Micro, Small and Medium Enterprises Development Act, 2006.

9. No interest was accrued and unpaid at the end of the accounting year.

10. No further interest remaining due and payable even in the succeeding years for the purpose of disallowance of a deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006

The above information regarding Micro, Small and Medium Enterprises has been determined on the basis of information available with the Company and has been relied upon by the Auditors.

11. Segment reporting

The Company has a single reportable business segment namely bearings for the purpose of Accounting Standard 17 on Segment Reporting.

Footnote:

12. Figures in brackets are in respect of the previous year.

13. No amounts pertaining to related parties have been provided for as doubtful debts. Further, no amounts have either been written off or written back during the year.

14. Dividend paid/received has not been considered by the Company as a transaction falling under the purview of Accounting Standard 18 "Related Party Disclosures".

15.- Lease Rentals

The Company has taken certain vehicles on operating lease. Lease rental charged to the statement of profit and loss for the year ended 31.03.2017 aggregated Rs. 69.30 lakhs (for the year ended 31.03.2016: Rs.75.39 lakhs). The minimum lease payments to be made in future as at the year end, in respect of non-cancellable lease are follows:

16. The expected rate of return on plan assets is based on the average long term rate of return expected on investments of the fund during the estimated term of obligation.

17. The assumption of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion, increment and other relevant factors.

18. The discount rate is based on prevailing market yield of government of India security as at the Balance sheet date for the estimated term of the obligation.

19. Compensated Expenses

20. Compensated Expenses recognized in the statement of profit and loss for the year, under employee benefit expense, is Rs.139.44 lakhs (for the year ended 31.03.2016 : Rs. 157.97 lakhs).

21. Pursuant to the notification issued by the Central Government extending the applicability of amendment to Accounting Standard 11 on ''The Effects of Changes in Foreign Exchange Rates'' up to March 31, 2020, which provides an option for adjustment of foreign exchange gain / loss arising on long term foreign currency borrowings against the carrying value of related fixed assets, the Company has continued to exercise the option and has adjusted exchange loss aggregating Rs. 4.99 lakhs (for the year ended 31.03.2016 : Rs. 503.90 lakhs) against the carrying value of fixed assets. The balance amount, based on aforesaid adjustments, of plant and machinery to be amortized, as at the year-end, aggregates Rs. 1436.14 lakhs (for the year ended 31.03.2016 : Rs. 1639.76 lakhs).

22. Specified Bank Notes (SBNs) and other denominations held and transacted during the period from November 8, 2016 to December 30, 2016, is given below as per MCA notification G.S.R 308(E) dated March 30, 2017:

23. Previous year figures have been regrouped / re-stated wherever necessary.

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Mar 31, 2016

i) Rights attached to equity shares:

a) Right to receive dividend as may be approved by the Board / Annual General Meeting.

b) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in
terms of the provisions of the Companies Act, 2013

c) Every member of the Company holding equity shares has a right to attend the General Meeting of the

Company and has a right to speak and on a show of hands, has one vote if he is present in person and on a
poll shall have the right to vote in proportion to his share of the paid- up capital of the Company.

Footnote:

The Company had in its Board meeting dated 22nd May, 2014, accepted the proposal of its Subsidiary to change the
redemption terms of Preference Shares, earlier scheduled to be fully redeemed on 18th June, 2014. As per the revised
terms, Rs. 150 lacs was redeemed on 18th June, 2014 and the balance of Rs 50 lacs will be redeemed equally over
the period of two years on 18th June, 2015 and 18th June, 2016 with an enhanced coupon rate of 11% p.a. effective
18th June, 2014 till its redemption. Accordingly, investment of Rs 25 lacs in Preference Shares of Subsidiary is classified
as Current.

NOTE 1- Disclosures under the Micro, Small and Medium Enterprises Development Act, 2006:

a) No amounts were due and outstanding to suppliers as at the end of the accounting year on account of Principal
and Interest.

b) No interest was paid during the year in terms of section 16 of the Micro, Small and Medium Enterprises
Development Act, 2006 and no amount was paid to the supplier beyond the appointed day.

c) No amount of interest is due and payable for the period of delay in making payment but without adding the
interest specified under the Micro, Small and Medium Enterprises Development Act, 2006

d) No interest was accrued and unpaid at the end of the accounting year.

e) No further interest remaining due and payable even in the succeeding years for the purpose of disallowance of a
deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006

The above information regarding Micro, Small and Medium Enterprises has been determined on the basis of information
available with the Company.

Footnote:

i) Figures in brackets are in respect of the previous year.

ii) No amounts pertaining to related parties have been provided for as doubtful debts. Further, no amounts have either
been written off or written back during the year except as disclosed above.

iii) Dividend paid/received has not been considered by the Company as a transaction falling under the purview of
Accounting Standard 18 "Related Party Disclosures".

NOTE 34 - Lease Rentals

The Company has taken certain vehicles on operating lease. Lease rental charged to the statement of Profit and loss for
the year ended 31.03.2016 aggregated Rs. 75.39 lacs (for the year ended 31.03.2015: Rs. 73.13 lacs). The minimum lease
payments to be made in future as at the year end, in respect of non-cancellable lease are follows:

These Forward Foreign Exchange Contracts are entered into for hedging purposes and not for speculation purposes

ii) Interest rate swaps to hedge against fluctuations in interest rate changes: No. of contracts: 2 (as at 31.3.2015: 2)

iii) Foreign currency exposures that have not been hedged by a derivative instrument or otherwise outstanding as at
31.03.2016:

Footnotes:

(i) The expected rate of return on plan assets is based on the average long term rate of return expected on
investments of the fund during the estimated term of obligation.

(ii) The assumption of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion, increment and other relevant factors.

(iii) The discount rate is based on prevailing market yield of Government of India security as at the Balance sheet
date for the estimated term of the obligation.

b) Compensated Expenses

(i) Compensated Expenses recognized in the statement of Profit and loss for the year, under employee benefit
expense, is Rs. 157.97 lacs (for the year ended 31.03.2015 : Rs. 196.54 lacs).

NOTE 2-

Pursuant to the notification issued by the Central Government extending the applicability of amendment to Accounting
Standard 11 on ''The Effects of Changes in Foreign Exchange Rates'' upto March 31, 2020, which provides an option
for adjustment of foreign exchange gain / loss arising on long term foreign currency borrowings against the carrying
value of related fixed assets, the Company has continued to exercise the option and has adjusted exchange loss
aggregating Rs. 503.90 lacs (for the year ended 31.03.2015 : Rs. 389.35 lacs) against the carrying value of fixed
assets. The balance amount, based on aforesaid adjustments, of plant and machinery to be amortized, as at the year-
end, aggregates Rs. 1639.76 lacs (Previous year Rs. 1309.82 lacs).

NOTE 3-

Previous year''s figures have been regrouped / re-stated wherever necessary.

---

Mar 31, 2015

1. Corporate Information:

NRB Bearings Limited incorporated in 1965, is engaged in the manufacture of ball and roller bearings.

As at As at 31.03.2015 31.03.2014 Rs. lacs Rs. lacs

NOTE 2 - Contingent liabilities not provided for:

a) Income Tax 1388.62 1077.66

b) Sales Tax 316.30 230.25

c) Customs Duty 158.87 158.87

d) Bank guarantees 96.29 37.56

e) Stand by letter of credit given to bank on behalf of a subsidiary Company 271.94 606.79

f) Corporate guarantees issued on behalf of subsidiary companies / group Company 5406.59 7481.38

The Company is in further appeal in respect of matters stated in a) to c) above

NOTE 3 - Segment reporting

The Company has a single reportable business segment namely bearings for the purpose of Accounting Standard 17 on Segment Reporting.

Footnote:

i) Figures in brackets are in respect of the previous year.

ii) No amounts pertaining to related parties have been provided for as doubtful debts. Further, no amounts have either been written off or written back during the year except as disclosed above.

iii) Dividend paid/received has not been considered by the Company as a transaction falling under the purview of Accounting Standard 18 "Related Party Disclosures".

NOTE 4 - Lease Rentals

The Company has taken certain vehicles on operating lease. Lease rental charged to the statement of profit and loss for the year ended 31.03.2015 aggregated Rs. 73.13 lacs (for the year ended 31.03.2014: Rs. 64.73 lacs ). The minimum lease payments to be made in future as at the year end, in respect of non-cancellable lease are follows:

Footnotes:

(i) The expected rate of return on plan assets is based on the average long term rate of return expected on investments of the fund during the estimated term of obligation.

(ii) The assumption of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion, increment and other relevant factors.

(iii) The discount rate is based on prevailing market yield of government of India security as at the Balance sheet date for the estimated term of the obligation.

b) Compensated Expenses

(i) Compensated Expenses recognised in the statement of profit and loss for the year, under employee benefit expense, is Rs. 196.54 lacs (for the year ended 31.03.2014 : Rs. 85.33 lacs).

NOTE 5

Pursuant to the notification issued by the Central Government extending the applicability of amendment to Accounting Standard 11 on ''The Effects of Changes in Foreign Exchange Rates'' upto 31st March, 2020, which provides an option for adjustment of foreign exchange gain / loss arising on long term foreign currency borrowings against the carrying value of related fixed assets, the Company has continued to exercise the option and has adjusted exchange loss aggregating Rs. 389.35 lacs (for the year ended 31.03.2014 : Rs. 519.38 lacs) against the carrying value of fixed assets. The balance amount, based on aforesaid adjustments, of plant and machinery to be amortised, as at the year- end, aggregates Rs. 1309.82 lacs (Previous year Rs. 1042.05 lacs).

The depreciation and amortistation expense in the Statement of Profit and Loss for the year is lower by Rs. 703.81 lacs consequent to the change in the useful life of the assets.

NOTE 6

The Company has an investment of Rs. 1640.56 lacs in equity shares of NRB Bearings (Thailand) Limited (NRB, Thailand) a wholly owned subsidiary, whose net worth has eroded as per the latest audited financial statements as at 31st March 2015. To strengthen the operations and financial health of NRB, Thailand, the Company has initiated several measures to increase sales (via new customer acquisition and increased penetration of the existing customer base) and improve cash flows. Significant efforts are being implemented to mine synergies between the Company and NRB, Thailand thus improving efficiencies and profitability of NRB, Thailand. The Company is committed to NRB, Thailand as a key investment to achieve its overall growth plan. Therefore, in view of the Management, the diminution in value of investments in NRB, Thailand is temporary.

NOTE 7

Previous year''s figures have been regrouped / re-stated wherever necessary.

---

Mar 31, 2013

1. Corporate Information:

NRB Bearings Limited incorporated in 1965, is engaged in the manufacture of ball and roller bearings.

NOTE 2 - Segment reporting

The Company has a single reportable business segment namely bearings for the purpose of Accounting Standard 17 on Segment Reporting.

NOTE 3 - Lease Rentals

The company has taken certain vehicles on operating lease. Lease rental charged to the statement of profit and loss for the year ended 31.03.2013 aggregated Rs. 67.76 lacs (for the year ended 31.03.2012: Rs. 44.72 lacs ). The minimum lease payments to be made in future as at the year end, in respect of non-cancellable lease are follows:

NOTE 4 - Financial and Derivative Instruments

i) Forward Exchange Contracts entered into by the company that are outstanding as at 31st March, 2013:

These Forward Foreign Exchange Contracts are entered into for hedging purposes and not for speculation purposes

ii) Currency Swap transaction to hedge against fluctuations in exchange rates:

iii) Interest rate swaps to hedge against fluctuations in interest rate changes: No. of contracts: 3 (as at 31.3.2012: 4)

iv) Foreign currency exposures that have not been hedged by a derivative instrument or other wise outstanding as at 31.03.2013:

v) Figures in brackets are the corresponding figures in respect of the previous year.

NOTE 5

The scheme of arrangement for the demerger of industrial bearings undertaking of the Company into NRB Industrial Bearings Limited (NIBL) was approved by the Hon''ble high court vide its order dated 24th August 2011 on getting requisite approvals and completion of necessary formalities.

Consequent to the vesting of the industrial bearings undertaking of the Company in terms of the scheme, the financial statement of the Company for the year ended 31 March 2013 do not include the operations of the industrial bearings for the six months from 1 October 2012 to 31 March 2013 and therefore are strictly not comparable with the figures of the previous year ended 31 March 2012.

All the assets and liabilities relating to industrial bearings business of the Company on the appointed date have been transferred to NIBL on a going concern basis. The excess of assets over liabilities relating to industrial bearings business as on 1st October 2012 being the appointed and effective date, have been adjusted in terms of the scheme against the General reserve amounting to Rs. 6184.78 lacs.

Further as per the scheme, NIBL has allotted to the shareholders of the Company, fully paid up equity shares in the ratio of one share for every four shares held in NRB Bearings Limited as on record date 26th October, 2012.

NOTE 6

On 19th April, 2011, the Board of Directors approved the scheme of arrangement under applicable sections of Companies Act, 1956, the merger of Trilochan Investments Company Private Limited (TICPL) (formerly known as Trilochan Sahney Finance and Holdings Private Limited) and the Company with effect from 1st October, 2011 viz. appointed date. The same was approved by the Hon''ble High Court of Judicature at Bombay on 13th January, 2012 and filed with the Registrar of Companies on 2nd February, 2012 viz. effective date.

Consequent to the merger, accounted under pooling of interests method, the Company has cancelled Nil (as at 31.3.2012: 37755640) equity shares of the Company held by TICPL and equivalent number of equity shares have been issued to equity shareholders of TICPL namely, Trilochan Singh Sahney Trust 1 (held by the trustee in his individual name) as consideration for the merger.

The assets taken over of TICPL, an investment Company comprise of investments in equity shares of NRB Bearings Limited of Rs. Nil (as at 31.3.2012: 6785.63 lacs), bank balance of Rs. Nil (as at 31.3.2012: Rs. 24.58 lacs) and liabilities of Rs. Nil (as at 31.3.2012: Rs. 24.58 lacs). The reserves of TICPL namely, general reserve of Rs. Nil (as at 31.3.2012: Rs. 6172.64 lacs), securities premium of Rs. Nil (as at 31.3.2012: Rs. 601.89 lacs) and capital redemption reserve of Rs. Nil (as at 31.3.2012: Rs. 11.10 lacs) have been accounted for at their respective book values. The value of investments of Rs. Nil (as at 31.3.2012: Rs. 6785.63 lacs) have been adjusted against general reserve resulting in net adjustment of Rs. Nil (as at 31.3.2012: Rs. 612.99 lacs).

NOTE 7

The company has entered into a joint venture agreement with Schneeberger Holding AG, Switzerland to act as its exclusive agent in India and has formed a joint venture company with effect from 15th February, 2008 for which NRB Bearings Limited has contributed towards its share capital on 14th May, 2008. With effect from, 1st October, 2012 the joint venture is transferred to NRB Industrial Bearings Limited under the scheme of demerger (refer note 42). The proportionate share in assets, liabilities, income & expenditure of the joint venture company as on 30th September, 2012 is given below :

NOTE 8

Previous year''s figures have been regrouped / re-stated wherever necessary.

---

Mar 31, 2012

1. Corporate Information:

NRB Bearings Limited incorporated in 1965, is engaged in the manufacture of ball and roller bearings.

i) Rights attached to equity shares:

a) Right to receive dividend as may be approved by the Board / Annual General Meeting.

b) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 1956.

c) Every member of the company holding equity shares has a right to attend the General Meeting of the company and has a right to speak and on a show of hands, has one vote if he is present in person and on a poll shall have the right to vote in proportion to his share of the paid-up capital of the company.

Footnotes:

i) 200, 11.5% privately placed non-convertible debentures of Rs. 1,000,000 each, redeemable at par, on 31st May, 2014. ii) Details of repayment of Loans

iii) For the amount of current maturities of long term borrowings, refer note 10 - Other current liabilities.

Footnote:

There are no amounts due to the suppliers covered under Micro, Small and Medium Enterprise Development Act, 2006; this information takes into account only those suppliers who have responded to the enquiries made by the Company for this purpose. This has been relied upon by auditors.

i. Refer footnote ii(a) and ii(c) in note 5 - Long term borrowings for details of security

ii. There is no amount outstanding and due as at the balance sheet date to be credited to the Investor Education and Protection Fund.

Note 1 - Contingent liabilities not provided for:

As at As at 31.03.2012 31.03.2011 Rs. Lacs Rs. Lacs

a) Income Tax 1035.04 812.00

b) Sales Tax 118.08 118.08

c) Customs Duty 158.87 158.87

d) Bank guarantees 7.75 3.75

e) Stand by letter of credit given to bank on behalf of a subsidiary company 1119.36 981.20

f) Corporate guarantees issued on behalf of subsidiary companies 2082.86 1899.85

The Company is in further appeal in respect of matters stated in a) to c) above

NOTE 2 - Segment reporting

The Company has a single reportable business segment namely bearings for the purpose of Accounting Standard 17 on Segment Reporting.

Footnote:

i) Figures in brackets are in respect of the previous year.

ii) No amounts pertaining to related parties have been provided for as doubtful debts. Further, no amounts have either been written off or written back during the year.

iii) Dividend paid has not been considered by the company as a transaction falling under the purview of Accounting Standard 18 "Related Party Disclosures".

iii) Interest rate swaps to hedge against fluctuations in interest rate changes: No. of contracts: 4 (as at 31.3.2011: 1)

Footnotes:

(i) The expected rate of return on plan assets is based on the average long term rate of return expected on investments of the fund during the estimated term of obligation.

(ii) The assumption of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion, increment and other relevant factors.

(iii) The discount rate is based on prevailing market yield of Government of India security as at the Balance sheet date for the estimated term of the obligation.

b) Compensated Expenses recognised in the statement of proft and loss for the year, under employee benefit expense, is Rs. 261.25 lacs (for the year ended 31.03.2011 : Rs 218.64 lacs).

NOTE 3 -

On 19th April, 2011, the Board of Directors approved the scheme of arrangement under applicable sections of Companies Act, 1956, the merger of Trilochan Investments Company Private Limited (TICPL) (formerly known as Trilochan Sahney Finance and Holdings Private Limited) and the Company with effect from 1st October, 2011 viz appointed date. The same was approved by the Hon'ble High Court of Judicature at Bombay on 13th January, 2012 and fled with the Registrar of Companies on 2nd February, 2012 viz. effective date.

Consequent to the merger, accounted under pooling of interests method, the Company has cancelled 37755640 equity shares of the Company held by TICPL and equivalent number of equity shares have been issued to equity shareholders of TICPL namely, Trilochan Singh Sahney Trust 1 (held by the trustee in his individual name) as consideration for the merger. The consequent change in the register of members has been made subsequent to 31st March, 2012 on receipt of approval from stock exchanges.

The assets taken over of TICPL, an investment Company comprise of investments in equity shares of NRB Bearings Limited of Rs. 6785.63 lacs, bank balance of Rs. 24.58 lacs and liabilities of Rs. 24.58 lacs. The reserves of TICPL namely, general reserve of Rs. 6172.64 lacs, securities premium of Rs. 601.89 lacs and capital redemption reserve of Rs. 11.10 lacs have been accounted for at their respective book values. The value of investments of Rs. 6785.63 lacs have been adjusted against general reserve resulting in net adjustment of Rs. 612.99 lacs.

NOTE 4 -

The board of directors in its meeting held on 12th October, 2011 approved the demerger of the industrial bearings undertaking of the Company into NRB Industrial Bearings Limited (NIBL), a wholly owned subsidiary incorporated to carry out the business of manufacturing and selling industrial bearings under the Scheme of Arrangement (the scheme), subsequently also approved by the shareholders on 3rd February, 2012 in an extra ordinary general meeting convened by the court. The said scheme is subject to statutory and contractual approvals, as may be required. Upon the scheme becoming effective, in consideration of the transfer and vesting of the industrial bearings undertaking in to NIBL, NIBL will allot to all shareholders of NRB Bearings Limited, fully paid up equity shares in the ratio of one share for every four shares held in NRB Bearings Limited. The appointed date for the scheme is 1st October, 2012.

Considering the industrial bearings undertaking's in significant scale of operations as compared to the Company's total operations, the demerger of the industrial bearings undertaking will not have a material impact on the Company's financials.

There are no capital commitment nor contingent liabilities.

Figures in brackets are the corresponding figures in respect of the previous year.

# net after deducting shareholders' funds.

NOTE 5 -

The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped wherever necessary.

---

Mar 31, 2011

As at As at

31.03.2011 31.03.2010

Rs. lacs Rs.lacs

1. Contingent liabilities not provided for:

a) Income Tax 812.00 378.92

b) Sales tax 118.08 118.08

c) Customs duty 158.87 158.87

d) Bank guarantees 3.75 13.15

e) Stand by letter of credit given to bank on behalf of a subsidiary company 981.20

f) Corporate guarantees issued on behalf of subsidiary companies. 1899.85 1770.28

The Company is in further appeal in respect of matters stated in a) to c) above.

2. There are no amounts due to the suppliers covered under Micro, Small and Medium Enterprises Development Act, 2006; this information takes into account only those suppliers who have responded to the enquiries made by the Company for this purpose. This has been relied upon by the auditors.

3. As the company's activity falls within a single segment viz. bearings and the sales substantially being in the domestic market, the disclosure requirements of Accounting Standard 17 "Segment Reporting" is not applicable.

4. Related party disclosures

(i) Names of related parties and nature of relationship

Sr. no Names of related parties Nature of relationship

(a) SNL Bearings Limited Subsidiary company

(b) NRB Bearings (Thailand) Limited Subsidiary company

(c) Schneeberger India Private Limited A Joint Venture of the Company

(d) Mr. T. S. Sahney, Individual having substantial interest in the voting Executive Chairman power and the power to direct by agreement, the financial and operating policies of the company.

(e) Ms. H. S.Zaveri, Managing Director Key management personnel

(f) Mr. D. S. Sahney, Key management personnel Whole time Director

(g) New Indo Trading Company A firm where executive chairman is a partner

(h) Mrs. H. K. Sahney Relative of executive chairman

9. Values used in calculating Earnings Per Share

The Company has allotted bonus shares in the ratio of 1:1 based on the shareholdings as per record date of 6th September, 2010 by capitalising the Share Premium Account. This has resulted in increase in issued and paid up equity share capital from Rs. 969.23 lacs to Rs. 1938.45 lacs. Accordingly, the Earnings Per Share for the year ended 31st March, 2010 have been restated to give the effect of bonus shares in accordance with Accounting Standard 20 (AS 20) - 'Earnings per share'.

b) Compensated absenses recognised in the statement of profit and loss account for the year, under employee cost, in Schedule 15, is Rs 218.64. Lacs (for the year ended 31.03.2010 : Rs. 112.86 Lacs).

5. Previous year's figures have been regrouped wherever necessary.

---

Mar 31, 2010

1. Contingent Liabilities

Contingent liabilities are disclosed in the notes on accounts. Provision is made in the accounts if it becomes probable that an outflow of resources embodying economic benefits will be required to settle the obligation.

As at As at 31.03.2010 31.03.2009 Rs. lacs Rs.lacs

1. Contingent liabilities not provided for:

a) Income Tax 378.92 60.25

b) Sales tax 118.08 46.01

c) Customs duty 158.87 158.87

d) Bank guarantees 13.15 8.00

e) Corporate guarantees issued on behalf of subsidiary companies. 1770.28 1973.56

The Company is in further appeal in respect of matters stated in a) to c) above.

2. Estimated amount of contracts remaining to be executed on capital account and not

provided for (net of advances) 625.77 1542.17

Year ended Year ended 31.03.2010 31.03.2009 Rs. lacs Rs.lacs

3. a) The amount of exchange differences (net): i) (credited) / debited to the profit and loss account is (170.67) 971.26

ii) added to/(deducted from) the carrying amount of fixed assets is (153.01) 555.14

b) Pursuant to the option available under the Companies (Accounting Standards) Amendment Rules, 2009, the Company had with effect from 1st April, 2007 changed its accounting policy wherein exchange differences arising on long term foreign currency monetary items relating to acquisition of depreciable capital asset has been added to or deducted from the cost of the asset and depreciated over its balance useful life. This had in the previous year resulted in reduction in general reserve by Rs. 130.66 lacs (net of deferred tax Rs. 67.21 lacs).

4. The company has investments of Rs. 1174.72 lacs (as at 31.03.2009 Rs.1174.72 lacs) comprising 2484176 Equity shares of Rs.10 each and 1000000 6% Cumulative redeemable preference shares of Rs.100 each, in SNL Bearings Limited (SNL), a subsidiary company. The company has also granted to SNL, advances and loans of Rs.300.00 lacs (as at 31.03.2009: Rs.300.00 lacs). Although SNL has substantial accumulated losses, in the opinion of the management, having regard to the long term prospects of SNL and the efforts being made to turnaround its financial position and performance, no provision for the loss is considered necessary.

5. There are no amounts due to the suppliers covered under Micro, Small and Medium Enterprises Development Act, 2006; this information takes into account only those suppliers who have responded to the enquiries made by the Company for this purpose. This has been relied upon by the auditors.

Year ended Year ended 31.03.2010 31.03.2009 Rs. lacs Rs.lacs

6. Expenditure on Research and Development:

a) charged to the profit and loss account 283.53 251.11

b) capitalized to fixed assets 35.10 44.72

7. As the companys activity falls within a single segment viz. bearings and the sales substantially being in the domestic market, the disclosure requirements of Accounting Standard 17 "Segment Reporting", is not applicable.

8. Related party disclosures

(i) Names of related parties and nature of relationship where control exists

(a) SNL Bearings Limited - subsidiary company

(b) NRB Bearings (Thailand) Limited - subsidiary company

(c) Mr. T. S. Sahney, Chairman and Managing Director - individual having substantial interest in the voting power and the power to direct by agreement, the financial and operating policies of the company.