Notes to Accounts of Schneider Electric President Systems Ltd.

Mar 31, 2015

1. Gratuity

The Company has a defined benefit gratuity plan. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service, except for workers at Pune factory being eligible for gratuity @ 30 days last drawn salary for each completed year of service. The scheme is funded with an insurance company in the form of qualifying insurance policy. The following tables summarise the components of net benefit expense recognised in the statement of proft and loss and the funded status and amounts recognised in the balance sheet for the respective plans.

2. Segment information

During the year ended 31st March, 2014, there was a change in the constitution of the Board of Directors. Based on the change in senior management and Board of Directors and the objective to have synergies by selling solutions to have effective increase in market share, the management believes that the Company deals in only one business segment because the entity does not have the ability to curtail the individual business i.e. manufacturing of enclosures and sales of allied traded products. Additionally, the reporting to the Board of Directors since 1st April, 2013, is at Company level only. The Company believes that it operates as one business segment with effect from 1st April, 2013 and accordingly disclosure requirements as per Accounting Standard - 17 on Segment Reporting are not applicable.

Secondary information is reported geographically.

Geographical segments:

The Company's secondary segments are the geographic distribution of activities. Revenue and receivables are specified by loca- tion of the customers while other geographic information is specified by location of the assets. The following table presents revenue, expenditure and certain asset information regarding the company's geographical segments:

3. Name of the related parties and related party relationship Related party where control exists Ultimate Holding Company Schneider Electric SA, France Holding Company Schneider Electric South East Asia (HQ) Pte Limited, Singapore Related parties with whom transactions have taken place during the year Fellow subsidiaries Schneider Electric IT Business India Private Limited, India Schneider Electric India Private Limited, India Schneider Electric Infrastructure Limited, India Invensys India Private Limited, India Schneider Electric IT Corporation, USA Schneider Electric Espana SAU, Spain Schneider Electric IT Logistic Asia Pacifc Pte. Limited, Singapore Schneider Electric Logistics Asia Pte. Limited, Singapore PT Schneider Electric Manufacturing Batam , Indonesia Schneider Electric Dc MEA Fzco, U.A.E. Schneider Electric Japan Inc., Japan APC (Xiamen) Power Infrastructure, China Sarel Appareillage Electrique, France Schneider Electric IT Australia P/L, Australia Schneider Electric IT SA (Pty) Ltd, South Africa Schneider Electric IT Singapore Pte Ltd., Singapore Schneider Electric Canada Inc, Canada Schneider Electric (China) Co. Ltd, China Schneider Electric IT France, France Schneider Electric Solar Inverters USA Inc. , USA Schneider Electric USA Inc., USA Clipsal Manufacturing (M) SDN BHD, Malasiya Unifair SPA, Italy

Key management personnel

Venkatraman S Managing Director (w.e.f. 13th August, 2013)

Dharni Babu V Manager (ceased to be a manager w.e.f. 13th August, 2013)

Additional related parties as per Companies Act, 2013 with whom transactions have taken place during the year:

Key management personnel

Damodar Kalavala Chief Officer (CFO) (w.e.f. 21st May, 2015)

Neeraj Garg Chief Officer (CFO) (ceased to be a CFO w.e.f 21st May, 2015)

Vighneshwar Bhat Company Secretary (w.e.f. 16th April, 2014)

4. As a part of Schneider Electric SA (Ultimate holding Company) overall pay policy, Schneider Electric SA, has set up a Worldwide Employee Stock Option Plan (WESOP) scheme to the employees of the group companies under which the employees are granted Stock Options of Schneider Electric SA.

The Institute of Chartered Accountants of India has issued a Guidance Note on Accounting for Employee Share-based payments, which is applicable to employee share based payment plans, the grant date in respect of which falls on or after April 1, 2005. The scheme detailed above is managed and administered by the ultimate parent company for its own benefit and do not have any settlement obligations on the Company. Further, the aforesaid scheme pertains to shares of the ultimate parent company and impact of compensation benefits in respect of such scheme is assessed and accounted for in the books of the parent Company. Accordingly, the Company is of the opinion that the same is not required to be accounted for as per the said Guidance Note.

5. The Company is in the process of completing transfer pricing study to ascertain whether international transactions with associated enterprises are in compliance with the transfer pricing norms under the Indian Income-tax Act, 1961. The Management does not anticipate any adjustment with regard to the transactions involved.

6. Loss before tax for the year ended 31st March, 2015 includes adjustments pertaining to earlier years amounting to (Rs.18,591,553) (31st March, 2014: (Rs.1,631,377)) as below.

7. During the year ended 31st March, 2014, the Company had changed its name from APW President Systems Limited to Schneider Electric President Systems Limited vide approval received from Registrar of Companies dated 4th October, 2013.

8. The previous year's fgures have been re-grouped/rearranged, wherever necessary to confrm to current years' classifcation

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Mar 31, 2014

1. Corporate Information

Schneider Electric President Systems Limited (formerly, APW President Systems Limited) (''SEPSL'' or ''the Company'') is a designer, manufacturer and supplier of standard and customized enclosure systems for over 27 years in 19-inch enclosures for IT and Telecom infrastructure, systems management and operations.

The Company''s operations predominantly relate to manufacture of enclosures, card frames, components and accessories and trading of electrical equipments. SEPSL is a manufacturer in India offering standard and customized enclosure solutions, including card frames and components, with a focus on the IT/Networking and ITES, Telecom, General and Industrial Electronics sectors.

SEPSL also has a nationwide network of sales offices, representatives and distributors to support customer wherever they may need assistance for installation, commissioning and on-going services.

2. Basis of preparation

The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting, unless stated otherwise and comply with the mandatory Accounting Standards (''AS'') prescribed under the Companies Act, 1956 read with the General Circular 08/2014 dated 04 April 2014 issued by the Ministry of Corporate Affairs, and other accounting principles generally accepted in India. The accounting policies adopted in the preparation of financial statements are consistent with those of the previous year.

Going concern uncertainty

The Company incurred a net loss of Rs.48,192,526 for the financial year ended 31 March 2014. Further, the Company incurred a net loss of Rs. 33,295,488 and Rs. 57,792,444 for the year ended 31 March 2013 and 2012, respectively. While these factors would normally indicate the existence of a material uncertainty which may cast significant doubt about the Company''s ability to continue as a going concern, the receipt of financial and operating support from the parent company, including increased borrowing limits and extension to repay the borrowing on 31 October 2018 from a group company in India, mitigates this uncertainty. Consequently, no adjustments have been made to the carrying value, or classification of the balance sheet amounts.

3 Long-term borrowings

i) Finance lease obligation is secured by hypothecation of vehicles taken on lease. The same is payable in 60 monthly installments of Rs.34,712 (including interest) each carrying an effective interest rate of 10.81% p.a.

ii) Loans from Fellow Subsidiary carry interest @ 10.75% p.a. which was revised to 9% p.a. w.e.f. 1 December 2012 and 7.5% w.e.f. 27 March 2014. The loan is repayable on 31, October 2018, although the Company has an option to prepay the aforesaid borrowing at its own discretion.

4 Deferred tax liability (net)

The Company has recognised deferred tax assets on deductible timing differences to the extent of deferred tax liability on taxable timing differences as the Company believes it is virtually certain that deferred tax asset on deductible timing differences (i.e., carry forward losses and losses disallowed for tax purposes u/s 43B of the Income Tax Act, 1961) shall be recovered to the extent of deferred tax liability on taxable timing differences arising on account of depreciation differences on fixed assets.

5 Provisions

i) The Company has unsecured working capital facility with Citibank for Rs. 60,000,000 with effect from 16 April 2013. The facility is repayable on demand and bears a floating rate determined based on market condition and is referenced to Reserve Bank of India base rate. Further, during the year the Company has withdrawn the existing facility with Syndicate Bank for Rs. 75,000,000 (31 March 2013: Rs. 75,000,000) with effect from 24 October 2013. The facilities with Syndicate Bank were secured by a charge on present and future inventories, trade receivables and fixed deposits. The facility had a floating rate determined based on market condition and is referenced to base rate plus margin of 450 basis points.

ii) During the current year, the Company has borrowed Rs. 50,000,000 from its fellow subsidiary, primarily to facilitate its working capital requirements, at an interest rate of 7.5 % p.a. The loan is repayable on or before 27 March 2015.

iii) Includes letter of credit from banks issued to various customers for supply of goods. The tenure of such letter of credit issued ranges from 90 to 180 days.

6 Employee benefits expense

During the year ended 31 March 2013, the Company reached final settlement with trade union on 19 July 2012 for the period of three years beginning 1 July 2011 with regard to increase of wages for the workers based out of Bangalore factory. Based on the agreement, employee benefit expense during the year includes Rs. Nil ( 31 March 2013Rs.329,313) pertaining to earlier year.

(ii) During the year ended 31 March, 2013, the Company had appointed an external agency to conduct the physical verification of entire block of fixed assets, except for computer equipments, of the Company as of 29 February 2012. Based on the report from the consultant, certain assets amounting to Rs. 876,807 were not found during the physical verification. Accordingly, the Company had written off such balance and charged the same to the statement of profit and loss for the year ended 31 March 2013.

7 Gratuity

The Company has a defined benefit gratuity plan. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service, except for workers at Pune factory being eligible for gratuity @ 30 days last drawn salary for each completed year of service. The scheme is funded with an insurance company in the form of qualifying insurance policy. The following tables summarise the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the respective plans.

8 Leases

Operating lease

The Company has entered into commercial leases on certain premises under cancelable operating lease. These leases expire on various dates upto 16 December 2014 and are renewable by mutual consent. There are no restrictions placed upon the Company by entering into these leases.

The rent expense incurred during the year amounts to Rs. 8,864,526 (31 March 2013: Rs. 13,028,993).

9 Segment information

The Company''s operations predominantly relate to manufacture of enclosures and card frames. The Company is organised into one main business segment namely ''Enclosures''. The business segment is identified considering the nature of services; the risk and returns, the organization structure and the internal financial reporting system. The accounting principles consistently used in the preparation of the financial statements are also consistently applied to record income and expenditure in individual segments.

All income and operating expenses, which can be identified with a particular business segment, have been categorized under the respective business segment. Operating expenses, which cannot be specifically identified with a business segment, have been allocated on a reasonable basis. General expenses which relate to the enterprise as a whole have not been allocated to any business segment and these expenses are disclosed separately as un-allocable expenses.

During the current year there has been a change in the constitution of the Board of Directors. Based on the change in senior management and Board of Directors and the objective to have synergies by selling solutions to have effective increase in market share, the management believes that the Company deals in only one business segment because the entity does not have the ability to curtail the individual business i.e. manufacturing of enclosures and sales of allied traded products. Additionally, the reporting to the Board of Directors since 1 April 2013, is at Company level only. The Company believes that it operates as one business segment with effect from 1st April 2013 and accordingly the segment information for previous year only has been disclosed below.

Secondary information is reported geographically.

Geographical segments:

The Company''s secondary segments are the geographic distribution of activities. Revenue and receivables are specified by location of the customers while other geographic information is specified by location of the assets. The following table presents revenue, expenditure and certain asset information regarding the company''s geographical segments:

10 Name of the related parties and related party relationship Related party where control exists

Ultimate Holding Company Schneider Electric SA, France

Holding Company Schneider Electric South East Asia (HQ) Pte Limited

Related parties with whom transactions have taken place during the year

Fellow subsidiaries Schneider Electric IT Business India Private Limited, India

American Power Conversion Corporation,USA Schneider Electric Espana SAU, Spain

Schneider Electric IT Logistic Asia Pacific Pte. Limited, Singapore APC Australia Pty. Limited, Australia PT Schneider Electric Manufacturing Batam , Indonesia Schneider Electric Dc MEA Fzco, U.A.E.

Schneider Electric India Private Limited, India

Schneider Electric Japan Inc., Japan

Schneider Electric Manufacturing (M) Sdn. Bhd., Malaysia

Uniflair India Private Limited, India

APC (Xiamen) Power Infrastructure, China

Sarel Appareillage Electrique, France

Schneider Electric Infrastructure Ltd, India

Schneider Electric IT Australia P/L, Australia

Schneider Electric IT Phillipines Inc, Phillipines

Schneider Electric IT SA (Pty) Ltd, South Africa

Schneider Electric IT Singapore Pte Ltd., Singapore

Schneider Electric Canada Inc, Canada

Schneider Electric (China) Co. Ltd, China

Key management personnel

Venkatraman S Managing Director (w.e.f 13 August 2013)

Dharni Babu V Manager (w.e.f. 1 April 2012) (ceased to be a manager w.e.f 13 August 2013)

Ajay Shankar Director (w.e.f. 9 October 2012) (ceased to be a director w.e.f 8 March 2013)

Charles Watanabe Director (w.e.f 19 May 2011) (ceased to be a director w.e.f. 5 October 2012)



31-Mar-14 31-Mar-13

29 Contingent liabilities Rs. Rs.

Claims against the Company not acknowledged as debts (i) 4,310,121 1,498,228

Excise and service tax matters 64,813 72,046

Sales Tax matters - Non collection of ''C'' and ''I'' forms 17,383,090 59,009,899

Outstanding bank guarantees 46,594,054 3,108,559

68,352,078 763,688,732

(i) During the current year, the Company has undertaken an exercise of reconciling its vendor balances with respect to the confirmations/account statements received from such vendors. The Company did not acknowledge vendor claims amounting to Rs.4,310,121(Rs. 1,498,228) as debts in absence of adequate documentation evidencing the proof of delivery of the materials to be received from the vendors. Further the management confirms that the materials are yet to be received by the Company. In absence of availability of adequate documentation/supporting evidences that need to be provided by the vendors, the management does not expect any material adverse effect on the financial position and the results of operation as at 31 March, 2014.

11 The Company is in the process of completing transfer pricing study to ascertain whether international transactions with associated enterprises are in compliance with the transfer pricing norms under the Indian Income-tax Act, 1961. The Management does not anticipate any adjustment with regard to the transactions involved.

12 Loss before tax for the year ended 31 March 2014 includes adjustments pertaining to earlier years amounting to (Rs.1,631,377) (31 March, 2013): (Rs. 631,279).

13 The Board of Directors passed a circular resolution at the Board meeting held on 27 July 2013 for changing the name from APW President Systems Limited to Schneider Electric President Systems Limited. Accordingly, management has obtained approval from the Registrar of Companies dated 4 October 2013.

14 The previouss year''s figures have been re-grouped/rearranged, wherever necessary to confirm to current years'' classification.

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Mar 31, 2013

1. Corporate Information

APW President Systems Limited (''APW'' or ''the Company'') is a designer, manufacturer and supplier of standard and customized enclosure systems for over 27 years in 19-inch enclosures for IT and Telecom infrastructure, systems management and operations.

The Company''s operations predominantly relate to manufacture of enclosures, card frames, components and accessories and trading of electrical equipments. APW is a manufacturer in India offering standard and customized enclosure solutions, including card frames and components, with a focus on the IT/Networking and ITES, Telecom, General and Industrial Electronics sectors.

APW also has a nationwide network of sales offices, representatives and distributors to support customer wherever they may need assistance for installation, commissioning and on-going services.

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (India GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 (''the Act''). The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.

Going concern uncertainty

The Company incurred a net loss of Rs.33,295,488 for the financial year ended 31 March 2013. Further, the Company incurred a net loss of Rs.57,792,444 and Rs.11,448,554 for the year ended March 31, 2012 and 2011, respectively. While these factors would normally indicate the existence of a material uncertainty which may cast significant doubt about the Company''s ability to continue as a going concern, the receipt of financial and operating support from the parent company, including increased borrowing limits and extension to repay the borrowing on October 31, 2018 from a group company in India, mitigates this uncertainty. Consequently, no adjustments have been made to the carrying value, or classification of the balance sheet amounts.

3. Gratuity

The Company has a defined benefit gratuity plan. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service, except for workers at Pune factory being eligible for gratuity @ 30 days last drawn salary for each completed year of service. The scheme is funded with an insurance company in the form of qualifying insurance policy. The following tables summarise the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the respective plans.

4 Segment information

The Company''s operations predominantly relate to manufacture of enclosures and card frames. The Company is organised into one main business segment namely ‘Enclosures''. The business segment is identified considering the nature of services; the risk and returns, the organization structure and the internal financial reporting system. The accounting principles consistently used in the preparation of the financial statements are also consistently applied to record income and expenditure in individual segments.

All income and operating expenses, which can be identified with a particular business segment, have been categorized under the respective business segment. Operating expenses, which cannot be specifically identified with a business segment, have been allocated on a reasonable basis. General expenses which relate to the enterprise as a whole have not been allocated to any business segment and these expenses are disclosed separately as un-allocable expenses.

Secondary information is reported geographically.

5. Name of the related parties and related party relationship Related party where control exists

Ultimate Holding Company Schneider Electric SA, France

Holding Company Schneider Electric South East Asia (HQ) Pte Limited

Related parties with whom transactions have taken place during the year

Fellow subsidiaries SEIT Vietnam COM OU, Vientnam

MGE UPS Systems Philippines Inc., Philippines

Alexander Schneider Limited, Israel

American Power Conversion Corporation Japan Inc., Japan

American Power Conversion Corporation, USA

APC (Xiamen) Power Infrastructure Company Limited, China

APC Australia Pty. Limited, Australia

PT Schneider Electric Manufacturing Batam, Indonesia

Sarel Appareillage Electrique SAS, France

Schneider Electric DC MEA FZCO, U.A.E.

Schneider Electric Espana SAU, Spain

Schneider Electric India Private Limited, India

Schneider Electric Infrastructure Limited, India

Schneider Electric IT Australia P/L, Australia

Schneider Electric IT Business India Private Limited (Formerly, American Power Conversion India (Private) Limited, India)

Schneider Electric IT Logistic Asia Pacific Pte. Limited, Singapore

Schneider Electric IT Phillipines Inc, Phillipines

Schneider Electric IT SA (Pty) Limited, South Africa

Schneider Electric IT Singapore Pte Limited., Singapore

Schneider Electric Japan Inc., Japan

Schneider Electric Manufacturing (M) Sdn. Bhd., Malaysia

Schneider Electric Canada Inc., Canada

Uniflair India Private.Limited., India

Universal Enclosures Systems, Spain

Related Companies M. Rutty & Co. Pty. Ltd, Australia (ceased to be a related company w.e.f 19 May 2011)

Key management personnel

Ajay Shankar Director (w.e.f. 9 October 2012) (ceased to be a director w.e.f 8 March 2013)

Ashok Kunte Director (ceased to be a director w.e.f. 19 May 2011)

Charles Watanabe Director (w.e.f 19 May 2011) (ceased to be a director w.e.f. 5 October 2012)

Dharni Babu Manager (w.e.f. 1 April 2012) (ceased to be manager w.e.f. 12 August 2013)

E. A. Elias Managing Director(ceased to be a director w.e.f. 19 May 2011)

Pramod Agashe Managing Director (w.e.f 19 May 2011) (ceased to be a director w.e.f. 31 March 2012) Sudhir Seth Director (ceased to be a director w.e.f. 19 May 2011)

6. The Company is in the process of completing transfer pricing study to ascertain whether international transactions with associated enterprises are in compliance with the transfer pricing norms under the Indian Income-tax Act, 1961. The Management does not anticipate any adjustment with regard to the transactions involved.

7. "Loss before tax for the year ended 31 March 2013 includes adjustments pertaining to earlier years amounting to Rs. 631,279.(March 31, 2012: (Rs. 1,327,457)). Further, deferred tax benefit includes adjustments pertaining to earlier year amounting to Rs. Nil (31 March 2012 :Rs. 5,578,122)."

8. The previous year''s figures have been re-grouped/rearranged, wherever necessary to confirm to current years'' classification.

9. The previous year''s figures are audited by a firm of chartered accountants other than S.R.Batliboi & Associates LLP.

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Mar 31, 2012

1. Corporate Information

APW President Systems Limited ('APW' or 'the Company') is a designer, manufacturer and supplier of standard and customized enclosure systems for over 27 years in 19-inch enclosures for IT and Telecom infrastructure, systems management and operations.

The Company's operations predominantly relate to manufacture of enclosures and trading of electrical equipments. APW is a manufacturer in India offering standard and customized enclosure solutions, including card frames and components, with a focus on the IT/Networking and ITES, Telecom, General and Industrial Electronics sectors.

APW also has a nationwide network of sales offices, representatives and distributors to support customer wherever they may need assistance for installation, commissioning and on-going services.

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (India GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3. Gratuity

The Company has a defined benefit gratuity plan. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure as per the policy of the Company, which is a minimum of 15 days for each completed year of service as per Gratuity Act. The scheme is funded with an insurance company in the form of qualifying insurance policy. The following tables summarise the components of net benefit expense recognised in the statement of profit and loss account and the funded status and amounts recognised in the balance sheet for the respective plans.

4. Segment information

The Company's operations predominantly relate to manufacture of enclosures and card frames. The Company is organised into one main business segment namely 'Enclosures'. The business segment is identified considering the nature of services; the risk and returns, the organization structure and the internal financial reporting system. The accounting principles consistently used in the preparation of the financial statements are also consistently applied to record income and expenditure in individual segments.

All income and operating expenses, which can be identified with a particular business segment, have been categorized under the respective business segment. Operating expenses, which cannot be specifically identified with a business segment, have been allocated on a reasonable basis. General expenses which relate to the enterprise as a whole have not been allocated to any business segment and these expenses are disclosed separately as un-allocable expenses.

The Company does not have any reportable geographical segment.

5. Contingent liabilities

31-Mar-12 31-Mar-11 Rs. Rs.

Claims against the Company not acknowledged as debts 1,382,317 --

Excise and service tax matters 119,015 680,579

Sales Tax matters – Non collection of Rs.C' and Rs.I' forms 44,134,583 58,673,379

Outstanding Bank Guarantees 3,462,926 2,548,655

6. Other Commitments

a. As at 31 March 2012, the Company has commitments of Rs.65,481,063 relating to purchase of services and raw materials.

b. For commitments relating to lease arrangements, please refer note 26.

7. Previous year figures

Till the year ended 31 March 2011, the Company was using pre-revised Schedule Vl to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this year's classification. Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of balance sheet. The following is a summary of the effects that revised Schedule VI had on presentation of balance sheet of the Company for the year ended 31 March 2011:

8. On 30 January 2012, the shareholders of the Company, through a special resolution passed through postal ballot, approved voluntary delisting of the equity shares of the Company from all the stock exchanges on which the equity shares are listed and traded. Consequently, Schneider Electric South East Asia (HQ) Pte Limited, promoter shareholders, could acquire up to 1,512,006 equity shares (representing 25 percent of the current issued and paid-up share capital) from the public shareholders of the Company. Post such acquisition by the promoter shareholder, the Company would seek to voluntarily delist the equity shares from all the stock exchanges on which such equity shares are listed and traded.

9. The Company is in the process of completing transfer pricing study to ascertain whether international transactions with associated enterprises are in compliance with the transfer pricing norms under the Indian Income-tax Act, 1961. The Management does not anticipate any adjustment with regard to the transactions involved.

10. Revenues include adjustments pertaining to earlier year amounting Rs. 1,327,457 (31 March 2011 – Nil). Further, deferred tax benefit includes adjustments pertaining to earlier year amounting Rs. 5,578,122 (31 March 2011 - . Rs. 3,397,582)

11. The previous year's figures are audited by a firm of chartered accountants other than S.R. Batliboi & Co. The accompanying notes are an integral part of the financial statements.

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Mar 31, 2011

1. Contingent Liabilities and Capital Commitments

As at As at March 31, 2011 March 31, 2010 (Rupees) (Rupees)

(a) Contingent Liabilities

Outstanding Bank Guarantees * 2,548,655 9,719,671 Claims against the Company not acknowledged as debts in respect of ** :

- Sales Tax matters – Non collection of C and I forms 58,673,379 62,800,604

- Excise and Services Tax matters 680,679 651,413

* All Bank Guarantees are Performance Bank Guarantees.

** The timing and the amount of cash flows, if any that may arise from the above matters will be determined only on settlement of the cases.

(b) Capital Commitments

Estimated amount of contracts remaining to be executed

on Capital Account (net of ad vances) 6,983,580 3,056,922

(c) In accordance with the Export Promotion of Capital Goods ("EPCG") Scheme, import of capital goods are allowed to be made duty free subject to the condition that the Company will fulfil, in future, a specified amount of export obligation within a specified time. As at March 31, 2011, the Company has received redemption letters for all EPCG licences from Joint Director General of Foreign Trade.

2. Shareholding Pattern

The Promoters of the Company entered into Share Purchase Agreement dated January 7, 2011 with Schneider Electric South East Asia (HQ) Pte Ltd (the "Acquirer",) to acquire 75% of the Share Capital of the Company by acquiring minimum of 55% of the share capital from the Promoters and upto 20% of Share Capital from the public shareholders. Accordingly, the Open Offer commenced on April 18, 2011 and closed on May 7, 2011. Closure of the transaction, as contemplated under Share Purchase Agreement, is expected by May 22, 2011, being 15 days from the date of closure of open offer, subject to regulatory approvals.

The above information and that given in schedule 13, "Current Liabilities and Provisions" regarding Micro and Small Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company.

* As informed by the Management, manufacturing licence does not contain details of licensed capacity.

- As certified by the Management.

Note (i) Enclosures includes Racks, Sub-racks, Cabinets for use in Telecom, Networking, Electrical and other industries and includes parts for ATMs.

(ii) Capacity for Enclosures includes capacity for components and accessories for contract manufacturing.

(iii) Capacity for various products is interchangeable as the machinery is common and processes are similar.

* The relevant information is given in aggregate as individual items are too numerous to be conveniently grouped and are of a value less than 10% of the total.

** Sales are net of excise duty and sales tax.

* The value of consumption of raw materials has been arrived at on the basis of Opening Stock plus Purchases less Closing Stock. The consumption, therefore, includes adjustments for raw materials written-off, shortage/excess, etc.

** The relevant information is given in aggregate as individual items are too numerous to be conveniently grouped and are of a value less than 10% of the total.

3. Related Party Disclosures

a. Related Party Disclosures as required by Accounting Standard 18, "Related Party Disclosures", issued by the Council of the Institute of Chartered Accountants of India are given below:

i) Subsidiary Company ii) Related Companies iii) Key Management Personnel

APW Systems MEA (FZC) LLC. M. Rutty & Co. Pty. Ltd. E. A. Elias (Subsidiary operation closed on March 31, 2010 APW Electronics Ltd. Sudhir Seth and full and final settlement against equity held APW Electronics Group Ltd. Ashok Kunte by the Company was received on July 12, 2010) APW Enclosures Systems (UK) Ltd.

This aforesaid list of related parties is limited to entities/ persons with whom transactions have taken place during the year or those who owe amounts to the Company or to whom amounts are owed by the Company at the year end. Other entities with whom there are no transactions have not been disclosed above.

4. Segmental Reporting

The business segment has been considered as the primary segment. The Company is organised into one main business segment, namely Enclosures, Card Frames, Instrument Case and Consoles.

The business segments have been identified considering the nature of services, the differing risks and returns, the organisation structure and the internal financial reporting system.

Segment revenue, results, assets and liabilities have been accounted for on the basis of their relationship to the operating activities of the segment and amounts allocated on a reasonable basis.

* Represents United Arab Emirates, Kuwait and Oman.

** Represents Australia, United States of America, China, Singapore, Japan, Hong Kong, United Kingdom, Egypt, Israel and Tunisia.

(iii) Notes:

(a) The Segment Revenue revenue in the geographical segments considered for disclosure are as follows:

- Revenue within India includes sales to customers located within India and earnings in India.

- Revenue outside India includes sales to customers located outside India, earnings outside India and export benefits on sales made to customers located outside India.

(b) Segment revenue, results, assets and liabilities include the respective amounts identified to each of the segments and amounts allocated on a reasonable basis.

MLP: Minimum Lease Payments

PV: Present Value

Lease expenses recognised during the year as interest Rs. 76,261 (Previous year: Rupees 169,975).

5. The Company uses forward contracts to hedge its risks of net exposure associated with foreign currency fluctuations. The Company does not enter into any forward contract which is intended for trading or speculative purposes.

Refer Note 1(F) above for accounting policy on Foreign Currency Transactions. 21. Previous year figures have been regrouped and recast wherever necessary to conform to the current year classification.

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Mar 31, 2010

1. Contingent Liabilities and Capital Commitments

Rupees (a) Contingent Liabilities As at March 31, As at March 31 2010 2009 Outstanding Bank Guarantees * 9,719,671 34,360,127 Claims against the Company not acknowledged as debts in respect of ** : - Sales Tax matters – Non collection of C and I forms 62,800,604 10,558,107 - Excise matters 651,413 -

* All Bank Guarantees are Performance Bank Guarantees.

** The timing and the amount of cash flows, if any that may arise from the above matters will be determined only on settlement of the cases.

(b) Capital Commitments As at March 31, 2010 As at March 31, 2009

Estimated amount of contracts remaining to be executed on Capital Account 3,056,922 55,784,652 (net of advances)

(c) In accordance with the Export Promotion of Capital Goods (“EPCG”) Scheme, import of capital goods are allowed to be made duty free subject to the condition that the Company will fulfill, in future, a specified amount of export obligation within a specified time. As at March 31, 2010, the Company has fulfilled equired export obligations against the amount of duty saved on import of capital goods. On fulfilment of required obligation, the Company has filed five applications for closure of EPCG Licences to Joint Director General of Foreign Trade (DGFT) out of which redemption letters for two licences have been received.

2. Diminution in the value of investment

The Company has an investment of Rs.1,736,713 (144 Equity Shares of DHS 1000 each) in the shares of APW Systems MEA FZC LLC (“APW MEA”), a subsidiary of the Company. The net worth of APW MEA has substantially eroded due to operational losses as on March 31, 2010. The Board of Directors of the Company has passed the resolution on March 31, 2010 to discontinue the operations and to liquidate APW MEA as of March 31, 2010 and its operations to be wound up as of that date.

On that basis, the account of APW MEA is not prepared on a going concern basis, accordingly, the Company has provided the diminution in the value of investment aggregate to Rs. 1,273,730 and is charged to Profit and Loss Account.

3. Segmental Reporting

The business segment has been considered as the primary segment. The Company is organised into one main business segment, namely ‘Enclosures, Card Frames, Instrument Case and Consoles’. The business segments have been identified considering the nature of services, the differing risks and returns, the organisation structure and the internal financial reporting system. Segment revenue, results, assets and liabilities have been accounted for on the basis of their relationship to the operating activities of the segment and amounts allocated on a reasonable basis.

4. (i) Hire Purchase /Lease Transactions

The Company has acquired Vehicles under Hire Purchase Scheme which expires on various dates up to September 5, 2011. The minimum lease payments and present value of minimum lease payments as at March 31, 2010 is as under:

(ii) Operating Lease Transactions

The Company has taken on lease commercial facilities under non-cancelable operating lease. This lease expires on various dates upto October 31, 2012 and is renewable at the request of lessee by mutual agreement for a further period. The future minimum lease payments as at March 31, 2010 in respect of these are as follows:

5. The Company uses forward contracts to hedge its risks of net exposure associated with foreign currency fluctuations. The Company does not enter into any forward contract which is intended for trading or speculative purposes.

6. Previous year figures have been regrouped and recast wherever necessary to conform to the current year classification.

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Mar 31, 2000

31.03.2000 31.03.1999 Rs. Rs.

1 Estimated amount of Contracts remaining 837,773 708,347 to be executed on Capital Account

2 Contingent Liabilities not provided for :-

i) On account of Bank Guarantees 3,387,964 4,697,380

ii) Claims against the Company not acknowledged as debts as the same are disputed in appeal

Entry Tax 73,034 --

Excise - 1,253,549

Customs Duty - 100,000

3 The basis of valuation of inventories has been changed during the year to conform to the revised accounting standard on Valuation of Inventories (AS2) issued by the Institute of Chartered Accountants of India

which became effective on 1st April, 1999. As a consquence, there is increase in the value of the inventories and profit for the year by Rs. 5.61 lakhs.

4 SUNDRY DEBTORS

Sundry Debtors include Rs. 834,888/- (P.Y. 125,835/-) due from a Private Limited Company in which a Director is interested.

5 SUNDRY CREDITORS

Sundry Creditors include Rs.25,22,864/-(P.Y.13,47,487/-) payable to small scalle industrial undertakings. Of these amount exceedings Rs.100,000 outstanding for more thapn 30 days were payable to the following parties:

1. Multilogic 2.Sharda Electro Chem 3.G.R.Enterprises 4. J.J.Engineering Works 5. K.K.Industries 6. Prameen Industries 7. Sri Raju & Raju Presstronics 8. Sritron

6 Previous years figures are regrouped / rearranged wherever necessary.