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Notes to Accounts of Vardhman Textiles Ltd.

Mar 31, 2016

1. CORPORATE INFORMATION

Vardhman Textiles Limited (The Company) is a public company incorporated under the provisions of the Companies Act, 1956 on 8th October, 1973. The name of the company at its incorporation was Mahavir Spinning Mills Ltd. & subsequently changed to Vardhman Textiles Limited on 5th September, 2006. The company is engaged in manufacturing of Cotton yarn, Synthetic yarn & woven fabric.

2. AMORTISATION OF INTANGIBLE ASSETS

a. Softwares have been amortised @ 25% on straight line basis as the useful life has been estimated to be not more than four years.

b. Right to use power lines have been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

c. Contribution to CETP has been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

3. The Company is holding 15,98,741 (Previous year 15,98,741) equity shares of Vardhman Textiles Limited through a trust, which were received by it in its capacity as a shareholder of Vardhman Holdings Limited, in accordance with the ''Scheme of Arrangement and Demerger''. Further, during the accounting year ended 31st March, 2012, the trust had been allotted 3,19,748 equity shares by Vardhman Specials Steels Limited (VSSL) in the ratio of one equity share against every five equity shares held in the company in accordance with the ''Scheme of Arrangement and Demerger'' entered into by the company, VSSL and their respective shareholders and creditors . The said trust has been exclusively formed for the benefit of the company. As per the provision of the trust deed, all the money received by the trust (including dividend and the proceeds of the sale of shares) shall be paid forthwith to the company by the trust.

4. The accumulated losses of Vardhman Nisshinbo Garments Company Limited, a subsidiary of the company, as on 31st March, 2016 are more than 50% of its net worth. However the subsidiary company has turned around and has reported net profit during the current financial year. In view of the management of the subsidiary company, these losses were only due to the starting phase of the business and based on the orders on hand and expected growth in export business the losses would be further reduced within a few years. Therefore no provision for decline in the value of investment has been made as in the opinion of the management of the Company, such decline is temporary in nature.

5. Business segments have been identified based on the nature and class of products and services, assessment of differential risks and returns. On the basis of factors detailed in Accounting Standard- 17 ''Segment Reporting'', Yarn and Fabric segments have been combined into one segment. Now company is a single segment company operating in textile business and disclosure requirements as contained in the Accounting Standard- 17 ''Segment Reporting'' are not required in the Standalone financial statements. However, the disclosure has been made in the Consolidated Financial Statements.

6. In accordance with the Accounting Standard (AS)-28 on "Impairment of Assets" the Company has assessed as on the Balance Sheet date, whether there are any indications (listed in paragraphs 8 to 10 of the Standard) with regard to the impairment of any of the assets. Based on such assessment it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has not been made. Accordingly no impairment loss has been provided in the books of account.

7. EARNING PER SHARE

(a) The calculation of Earning Per Share (EPS) as disclosed in the Statement of Profit and Loss has been made in accordance with Accounting Standard (AS)-20 on "Earning Per Share" prescribed in Companies (Accounts) rules, 2014.

(i) A statement on calculation of basic EPS is as under:

8. LEASES :

The Company has leased facilities under cancellable and non-cancellable operating leases arrangements with a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses recognised during the year amounts to Rs.100.02lacs (Previous Year Rs.108.37 lacs). The future minimum lease payments in respect of the non-cancellable operating leases are:

9. Disclosure required by Regulation 34 read with Schedule V of SEBI (Listing obligations and Disclosure Requirements) Regulations,2015:-

(i) The Company has given inter corporate deposits aggregating to Rs.Nil (Previous Year Rs.500.00 lacs) to M/s Vardhman Acrylics Ltd. during the year. The maximum amount outstanding during the year was Rs.Nil (Previous Year Rs.500.00 lacs). The Balance outstanding as on 31.03.16 is Rs.Nil (Previous Year Rs.Nil).

(ii) The Company has given inter corporate deposits aggregating to Rs. NIL (Previous Year Rs.2,844.00 lacs) to M/s VMT Spinning Company Limited during the year. The maximum amount outstanding during the year was Rs. NIL (Previous Year Rs.1,098.00 lacs). The Balance outstanding as on 31.03.16 is Rs.Nil (Previous Year Rs.Nil).

(iii) The Company has given inter corporate deposits aggregating to Rs.4,700.00 lacs (Previous Year Rs.65,079.00 lacs) to M/s Vardhman Special Steels Limited. The maximum amount outstanding during the year was Rs.1,954.57 lacs (Previous Year Rs.6,535.74 lacs). The Balance outstanding as on 31.03.2016 is Rs.1,500.00 lacs (Previous Year Rs.2,554.57 lacs).

(iv) The Company has given inter corporate deposits aggregating to Rs.681.00 lacs (Previous Year Rs.1,636.00 lacs) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The maximum amount outstanding during the year was Rs.1,199.12 lacs (Previous Year Rs.1,187.62 lacs). The Balance outstanding as on 31.03.16 is Rs.1,199.12 lacs (Previous Year Rs.918.12 lacs).

(v) The Company has given inter corporate deposits aggregating to Rs.Nil (Previous Year Rs.2,621.00 lacs) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding during the year was Rs.Nil (Previous Year Rs.861.00 lacs). The Balance outstanding as on 31.03.16 is Rs.Nil (Previous Year Rs.Nil).

10. Figures in bracket indicate deductions.

11. Previous year''s figures have been recast/regrouped wherever necessary, to make these comparable with current year''s figures.

12. In accordance with the provisions of Section 135 of the Companies Act, 2013 the company has paid a sum of Rs.476.60 lacs (Previous year Rs.600.00 lacs) towards approved CSR activities. The said amount stands debited to the "Miscellaneous" under the head "other expenses".

13. The Payment of Bonus (Amendment) Act 2015, notified on 31st December 2015, has revised the thresholds for coverage of employee eligible for Bonus and also enhanced the ceiling limits for computation of bonus retrospectively from 1st April 2014. Based on legal opinion, the Company has filed a writ petition in Hon''ble High Court of Punjab & Haryana contesting its retrospective applicability and the same is pending for hearing. However, the said jurisdictional High Court has already granted stay on its retrospective operation in some other case. In view thereof, the company has not provided differential bonus pertaining to the period from 1st April 2014 to 31st March 2015 amounting to Rs.8.21 crore.

However, the company has provided bonus for the current financial year according to the amended provisions of the Payment of Bonus (Amendment) Act 2015.

14. EMPLOYEE BENEFITS :

The summarized position of Post-employment benefits and long term employee benefits recognized in the Statement of Profit and Loss and Balance Sheet as required in accordance with Accounting Standard (AS) 15 is as under:-

15. The company uses forward contracts and options to hedge its risk associated with fluctuation in foreign currency relating to foreign currency assets and liabilities, firm commitment and highly probable forecast transactions. The use of the aforesaid financial instruments is governed by the company''s overall risk management strategy. The company does not use forward contracts and options for speculative purposes. The details of the outstanding forward contracts and options as at 31st March 2016 is as under:


Mar 31, 2015

1. CORPORATE INFORMATION

Vardhman Textiles Limited (The Company) is a public company incorporated under the provisions of the Companies Act, 1956 on 8th October, 1973. The name of the company at its incorporation was Mahavir Spinning Mills Ltd. & subsequently changed to Vardhman Textiles Limited on 5th September, 2006. The company is engaged in manufacturing of Cotton yarn, Synthetic yarn & woven fabric.

2. Rights, preferences and restrictions attached to equity shares

The company has one class of equity shares having a par value of Rs.10/- each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting.

During the year ended March 31, 2015 the amount of per share dividend recognised as distributions to equity shareholders was Rs.10 per share (Previous Year: Rs.11).

In the event of liquidation of the company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

3. Rights, preferences and restrictions to Preference Shares

The rate of dividend on preference shares will be decided by the Board of Directors as and when issued. Preferential shares as and when issued shall have the cumulative right to receive dividend as and when declared and shall have preferential right of repayment of amount of capital.

4. Shares held by holding company or its ultimate holding company or subsidiaries or associates of the holding company or the ultimate holding company in aggregate.

5.There is no holding or ultimate holding company of the company.

a). Details of security for term loans

Term loans from banks are secured by mortgage created or to be created on all the immovable assets of the company, both present and future and hypothecation of all movable assets including movable machinery, machinery parts, tools and accessories and other movable both present and future (except book debts), subject to charges created or to be created in favour of the bankers for securing the working capital limits.

6. Contingent liabilities and Commitments (to the extent not provided for): No outflow is expected in view of past history relating to these items: -

(Rs. in lac)

Particulars As at 31st As at 31st March 2015 March,2014

I Contingent Liabilities

(i) Claims not acknowledged as debts 827.69 790.29

(ii) Bank Guarantees and Letters of Credit outstanding 8,781.05 6,407.84

(iii) Bills discounted with banks 13,710.55 7,884.34

(iv) Other monies for which the company is contingently liable

a) The Company has contested the additional demand in respect of Sales Tax, Excise Duty etc., amounting to H1,159.80 lac (Previous Year Rs.1,319.07 lac). As against this a sum of Rs.113.70 lac (Previous Year H102.14 lac) has been deposited under protest and stands included under the head "other recoverables in note-21 - Short-term loans and advances ". The Company has filed an appeal with the Appellate Authorities and is advised that the demand is not in accordance with law. No provision, therefore, has been made in accounts in respect thereof.

b) The Company has contested the additional demand in respect of income tax amounting to H16,298.27 lac (Previous Year Rs.14,681.78 lac). As against this a sum of H6,035.72 lac (Previous year Rs. 6,248.56 lac) has been deposited/adjusted under protest and stands included under the head "Advance income tax" in Note-15 "Long term loans and advances". Provision of Rs.14,250.47 lac (Previous Year Rs.11,695.08 lac ) in this respect has not been made as the company has filed various appeals with the appellate authorities and the company is confident to get the the desired relief.

c) The company had taken over the textile undertaking of Vardhman Holdings Limited (formerly known as Vardhman Spinning & General Mills Limited) by a scheme of Arrangement and De-merger. An injunction was obtained against the London Branch of the said textile undertaking for preventing disposal of assets upto the value of Pound Sterling 2.99 lac as a result of a court case pending in London for alleged non-fulfilment of an agreement of cotton purchase. The said matter had been decided against the said textile undertaking and accordingly, Pound Sterling 0.48 lac lying in the bank account at London had been paid to the claimant pursuant to the Order of the Court. The said amount was written off in the books of the said undertaking by way of debit to the statement of Profit and Loss. No provision has been made for the balance decreed amount by the undertaking in view of the fact that the said undertaking was prevented by force majure in fulfiling its part of contract. The Company as successor to the textile undertaking is contesting this matter in Indian Courts and is confident that there would not be any further liability in this regard.

(Rs. in lac)

Particulars As at 31st As at 31st March,2015 March,2014

II Commitments

(i) Estimated amount of contracts remaining to be executed on Capital 12,151.21 11,611.40 Account and not provided for (net of advances)

(ii) Exports obligations under Export Promotion Capital Goods 49,512.28 Nil (EPCG) scheme#

#The Company has executed bonds for an aggregate amount of H91,640.51 lac (Previous Year H79,013.25 lac) in favour of the President of India under section 59 (2) and 67 of the Customs Act,1962 and Central Excise and salt Act, 1944 for fulfilment of the obligation under the said Acts.

7. Depreciation for the year has been provided on Straight Line Method on the basis of useful lives specified in the Schedule-II of the Companies Act, 2013 as against the amount of depreciation calculated on the basis of rates of depreciation in respect of various assets contained in Schedule XIV to the Companies Act 1956.

In view of this change, carrying amounts of various tangible fixed assets as at 1st April, 2014 of H4,928.09 lacs (net of deferred tax of Rs.1, 182.68 lacs) has been recognized in the opening balance of retained earnings, where the useful life of an asset is nil. In other cases, the carrying amounts as at 1st April, 2014 have been depreciated over the revised remaining useful life of the asset as per Schedule II. The depreciation for the year is higher to the extent of H15,635.13 lacs on account of this change and accordingly the profit for the year is lower by H15,635.13 lacs.

8. Amortisation of Intangible assets

a. Softwares have been amortised @ 25% on straight line basis as the useful life has been estimated to be not more than four years.

b. Right to use power lines have been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

9. The Company is holding 15,98,741 (Previous year 15,98,741) equity shares of Vardhman Textiles Limited through a trust, which were received by it in its capacity as a shareholder of Vardhman Holdings Limited, in accordance with the 'Scheme of Arrangement and Demerger'. Further, during the accounting year ended 31st March, 2012, the trust had been allotted 3,19,748 equity shares by Vardhman Specials Steels Limited (VSSL) in the ratio of one equity share against every five equity shares held in the company in accordance with the 'Scheme of Arrangement and Demerger' entered into by the company, VSSL and their respective shareholders and creditors . The said trust has been exclusively formed for the benefit of the company. As per the provision of the trust deed, all the money received by the trust (including dividend and the proceeds of the sale of shares) shall be paid forthwith to the company by the trust.

10. The accumulated losses of Vardhman Nisshinbo Garments Company Limited, a subsidiary of the company, as on 31st March, 2015 are more than 50% of its net worth. In view of the management of the subsidiary company, these losses are only due to the starting phase of the business and based on the orders on hand and expected growth in export business the losses would be reduced within few years. Therefore no provision for decline in the value of investment has been made as in the opinion of the management of the Company, such decline is temporary in nature.

11. Segment Information as required by Accounting Standard (AS)-17 on "Segment Reporting" issued by Companies (Accounting Standards) Rules 2006, has been compiled on the basis of the consolidated financial statements and is disclosed in the notes to accounts forming part of the consolidated financial statements in accordance with the above standard. Therefore segment information in respect of separate financial statements of the company is not being disclosed in the stand alone financial statements.

12. In accordance with the Accounting Standard (AS)-28 on "Impairment of Assets" the Company has assessed as on the balance sheet date, whether there are any indications (listed in paragraphs 8 to 10 of the Standard) with regard to the impairment of any of the assets. Based on such assessment it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has not been made. Accordingly no impairment loss has been provided in the books of account.

13. Related Party Disclosure

(a) Disclosure of Related Parties and relationship between the parties.

1. Subsidiaries VMT Spinning Company Limited Vardhman Acrylics Limited VTL Investments Limited Vardhman Yarns and Threads Limited Vardhman Nisshinbo Garments Company Limited

2. Associates Vardhman Textile Components Limited (upto 30-03-2014) Vardhman Spinning and General Mills Limited Vardhman Special Steels Limited

3. Key Management Mr. S.P.Oswal Personnel Mr. Sachit Jain Mrs. Suchita Jain Mr. Neeraj Jain

4. Enterprises over Vardhman Holdings Limited which key Management Vardhman Apparels Limited Personnel and relative Smt. Banarso Devi Oswal Public Charitable of such personnel Trust is able to exercise Sri Aurobindo Socio Economic and Management significant influence Research Institute or control *Adhiswar Enterprises LLP (formerly known as Adinath Investment and Trading Company) *Devakar Investment and Trading Co. Limited *Srestha Holdings Limited *Santon Finance and Investment Co. Limited *Flamingo Finance and Investment Co. Limited *Ramaniya Finance and Investment Co. Limited *Marshall Investment and Trading Co.(P) Limited *Pardeep Mercentile Co. (P) Limited *Plaza Trading Co. (P) Limited *Anklesh Investment (P) Limited *Syracuse Investment and Trading Co. (P) Limited *Mahavir Spinning Mills (P) Ltd. **Northern Trading Co. **Amber Syndicate **Paras Syndicate **Adinath Syndicate **Eastern Trading Company

Note: *Only Loan Transactions have taken place with these Companies.

**No transaction has taken place during the year.

14. Disclosure required by Clause 32 of Listing Agreement:

(i) The Company has given inter corporate deposits aggregating to H500 lac (Previous Year Rs. Nil) to M/s Vardhman Acrylics Ltd. during the year. The maximum amount outstanding during the year was H500 lac (Previous Year Rs. Nil). The Balance outstanding as on 31.03.15 is Rs. Nil (Previous Year Rs. Nil).

(ii) The Company has given inter corporate deposits aggregating to H2,844 lac (Previous Year H4,553 lac) to M/s VMT Spinning Company Limited during the year. The maximum amount outstanding during the year was Rs.1,098 lac (Previous Year H1,519 lac). The Balance outstanding as on 31.03.15 is Rs. Nil (Previous Year Rs. Nil).

(iii) The Company has given inter corporate deposits aggregating to H65,079.00 lac (Previous Year Rs.81,891 lac) to M/s Vardhman Special Steels Limited. The maximum amount outstanding during the year was H6,535.74 lac (Previous Year H5,634 lac). The Balance outstanding as on 31.03.15 is H2,554.57 lac (Previous Year H1,346.50 lac).

(iv) The Company has given inter corporate deposits aggregating to H1,636 lac (Previous Year Rs.2,113.50 lac) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The maximum amount outstanding during the year was Rs.1,187.62 lac (Previous Year Rs.1,602.40 lac ). The Balance outstanding as on 31.03.15 is Rs.18.12 lac (Previous Year Rs.773.90 lac).

(v) The Company has given inter corporate deposits aggregating to Rs.2,621.00 lac (Previous Year Rs.1,493.50 lac ) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding during the year was Rs.861.00 lac (Previous Year Rs.613.50 lac). The Balance outstanding as on 31.03.15 is Rs. Nil (Previous Year Rs. Nil).

15. Figures in bracket indicate deductions.

16. Previous year's figures have been recast/regrouped wherever necessary, to make these comparable with current year's figures.

17. In accordance with the provisions of Section 135 of the Companies Act, 2013 the company has contributed a sum of H600.00 lac towards an approved CSR activity. The said amount stands debited to the "Miscellaneous" under the head "Other expenses".


Mar 31, 2014

1. CORPORATE INFORMATION

Vardhman Textiles Limited (The Company) is a public Company incorporated under the provisions of the Companies Act, 1956 on 8th October, 1973. The name of the Company at its incorporation was Mahavir Spinning Mills Ltd. & subsequently changed to Vardhman Textiles Limited on 5th September, 2006. The Company is engaged in manufacturing of Cotton yarn, Synthetic yarn & woven fabric.

2. CONTINGENT LIABILITIES AND PROVISIONS (to the extent not provided for) (Rs in lac) Particulars As at As at 31st March 2014 31st March 2013

I Contingent Liabilities

(i) Claims not acknowledged as debts 790.29 1,342.23

(ii) Bank Guarantees and Letters of Credit outstanding 6,407.84 22,612.40

(iii) Bills discounted with banks 7,884.34 4,176.64

(iv) Other monies for which the Company is contingently liable

a) The Company has contested the additional demand in respect of Sales Tax, Excise Duty etc., amounting to Rs.1,319.07 lac (Previous Year Rs.51 5.02 lac). As against this a sum of Rs.102.14 lac (Previous Year Rs.101.71 lac) has been deposited under protest and stands included under the head "other recoverable in note-21 - Short-term loans and advances ". The Company has filed an appeal with the Appellate Authorities and is advised that the demand is not in accordance with law. No provision, therefore, has been made in accounts in respect thereof.

b) The Company has contested the additional demand in respect of income tax amounting to Rs.14,681.78 lac (Previous Year Rs.5,036 lac). Pending appeal with appellate authorities, provision of Rs.11,695.08 lac (Previous Year Rs.2,323 lac) has not been made in the books of account as the Company is confident to get the desired relief.

c) The Company had taken over the textile undertaking of Vardhman Holdings Limited (formerly known as Vardhman Spinning & General Mills Limited) by a scheme of Arrangement and De-merger. An injunction was obtained against the London Branch of the said textile undertaking for preventing disposal of assets upto the value of Pound Sterling 2.99 lac as a result of a court case pending in London for alleged non-fulfilment of an agreement of cotton purchase. The said matter had been decided against the said textile undertaking and accordingly, Pound Sterling 0.48 lac lying in the bank account at London had been paid to the claimant pursuant to the Order of the Court. The said amount was written off in the books of the said undertaking by way of debit to the statement of Profit and Loss. No provision has been made for the balance decreed amount by the undertaking in view of the fact that the said undertaking was prevented by force majure in fulfiling its part of contract. The Company as successor to the textile undertaking is contesting this matter in Indian Courts and is confident that there would not be any further liability in this regard.

#The Company has executed bonds for an aggregate amount of Rs.79,013.25 lac (Previous Year Rs.120,916.00 lac) in favour of the President of India under section 59 (2) and 67 of the Customs Act,1962 and Central Excise and salt Act, 1944 for fulfilment of the obligation under the said Acts.

32. The Company has provided depreciation on Computers @ 25% on straight line basis as the useful life of the computers has been estimated to be not more than four years.

33. AMORTISATION OF INTANGIBLE ASSETS

a. Softwares have been amortised @ 25% on straight line basis as the useful life has been estimated to be not more than four years.

b. Right to use power lines have been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

3. The Company is holding 1,598,741 (Previous Year 1,598,741) equity shares of Vardhman Textiles Limited through a trust, which were received by it in its capacity as a shareholder of Vardhman Holdings Limited, in accordance with the ''Scheme of Arrangement and Demerger''. Further, during the accounting year ended 31st March, 2012, the trust had been allotted 3,19,748 equity shares by Vardhman Specials Steels Limited (VSSL) in the ratio of one equity share against every five equity shares held in the Company in accordance with the ''Scheme of Arrangement and Demerger'' entered into by the Company, VSSL and their respective shareholders and creditors. The said trust has been exclusively formed for the benefit of the Company. As per the provision of the trust deed, all the money received by the trust (including dividend and the proceeds of the sale of shares) shall be paid forthwith to the Company by the trust.

4. The accumulated losses of Vardhman Nisshinbo Garments Company Limited, a subsidiary of the Company, as on 31st March, 2014 are more than 50% of its net worth. In the view of the management of the subsidiary company, these losses are only due to the starting phase of the business and based on the orders on hand and expected growth in export business the losses would be reduced within few years. Therefore no provision for decline in the value of investment is considered as such decline is temporary in nature.

5. Segment Information as required by Accounting Standard (AS)-17 on "Segment Reporting" issued by Companies (Accounting Standards) Rules 2006, has been compiled on the basis of the consolidated financial statements and is disclosed in the notes to accounts forming part of the consolidated financial statements in accordance with the above standard. Therefore segment information in respect of separate financia statements of the Company is not being disclosed in the stand alone financial statements.

6. In accordance with the Accounting Standard (AS)-28 on "Impairment of Assets" the Company has assessed as on the balance sheet date, whether there are any indications (listed in paragraphs 8 to 10 of the Standard) with regard to the impairment of any of the assets. Based on such assessment it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has not been made. Accordingly no impairment loss has been provided in the books of account.

7. EARNING PER SHARE

(a) The calculation of Earning Per Share (EPS) as disclosed in the statement of profit and loss has been made in accordance with Accounting Standard (AS)-20 on "Earning Per Share" issued by Companies (Accounting Standards) Rules, 2006.

Dues of Micro, Small and Medium enterprises have been determined on the basis of information collected by the management. This has been relied upon by the auditors.

8. LEASES

The Company has leased facilities under cancellable and non-cancellable operating leases arrangements with a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses recognised during the year amounts to Rs.104.32 lac (Previous Year Rs.88.37 lac). The future minimum ease payments in respect of the non-cancellable operating leases are:

9. RELATED PARTY DISCLOSURE

(a) Disclosure of Related Parties and relationship between the parties.

1. Subsidiaries VMT Spinning Company Limited Vardhman Acrylics Limited VTL Investments Limited Vardhman Yarns and Threads Limited Vardhman Nisshinbo Garments Company Limited

2. Associates Vardhman Textile Components Limited (upto 30-03-2014) Vardhman Spinning and General Mills Limited Vardhman Special SteelsLimited

3. Key Management Personnel Mr. S.P.Oswa Mr. Sachit Jain Mrs. Suchita Jain Mr. Neeraj Jain

4. Enterprises over which key Management Personnel and relative of such personnel is able to exercise significant influence or Public Charitable Trust control : Vardhman Holdings Limited **Vardhman Apparels Limited Smt. Banarso Devi Oswal Sri Aurobindo Socio Economic and Management Research Institute *Adinath Investment and Trading Co. *Devakar Investment and TradingCo. Limited *Srestha Holdings Limited *Santon Finance and InvestmentCo. Limited *Flamingo Finance and Investment Co. Limited *RamaniyaFinance and Investment Co. Limited *Marshall Investment and Trading Co.(P) Limited *Pardeep Mercentile Co. (P) Limited *Plaza Trading Co. (P)Limited *Anklesh Investment (P) Limited *Syracuse Investment andTrading Co. (P) Limited *Mahavir Spinning Mills (P) Ltd. **NorthernTrading Co. **Amber Syndicate **Paras Syndicate **Adinath Syndicate **Eastern Trading Company

Note: *Only Loan Transactions have taken place with these Companies. **No transaction has taken place during the year.

10. DISCLOSURE REQUIRED BY CLAUSE 32 OF LISTING AGREEMENT:

(i) The Company has given inter corporate deposits aggregating to Rs. Nil (Previous Year Rs.14,334.00 lac) to M/s Vardhman Acrylics Ltd. during the year. The maximum amount outstanding during the year was Rs. Nil (Previous Year Rs.1,190.50 lac). The Balance outstanding as on 31.03.14 is Rs. Nil (Previous Year Rs. Nil).

(ii) The Company has given inter corporate deposits aggregating to Rs.4,553 lac (Previous Year Rs.5,687.60 lac) to M/s VMT Spinning Company Limited during the year. The maximum amount outstanding during the year was Rs.1,519 lac (Previous Year Rs.1,620.55 lac). The Balance outstanding as on 31.03.14 is Rs. Nil (Previous Year Rs. Nil).

(iii) The Company has given inter corporate deposits aggregating to ^81,891 lac (Previous Year Rs.65,109.32 lac) to M/s Vardhman Specia Steels Limited. The maximum amount outstanding during the year was Rs.5,634 lac (Previous Year Rs.8,210.00 lac). The Balance outstanding as on 31.03.2014 is Rs.1,346.50 lac (Previous Year Rs. Nil lac).

(iv) The Company has given inter corporate deposits aggregating to Rs.2,113.50 lac (Previous Year Rs.1,724.00 lac) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The maximum amount outstanding during the year was Rs.1,602.40 lac (Previous Year Rs.1,424.40 lac). The Balance outstanding as on 31.03.14 is Rs.773.90 lac (Previous Year Rs.1,373.40 lac).

(v) The Company has given inter corporate deposits aggregating to Rs. Nil (Previous Year Rs. Nil lac) to M/s VTL Investments Limited during the year. The maximum amount outstanding during the year was Rs. Nil (Previous Year Rs. Nil lac). The Balance outstanding as on 31.03.14 is Rs. Nil (Previous YearRs. Nil).

(vi) The Company has given inter corporate deposits aggregating to Rs.1,493.50 lac (Previous Year Rs.3,261.75 lac) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding during the year was Rs.613.50 lac (Previous Year Rs.1,230.1 5 lac). The Balance outstanding as on 31.03.14 isRs. Nil (Previous Year Rs. Nil).

11. Figures in bracket indicate deductions.

12. EMPLOYEE BENEFITS :

The summarised position of Post-employment benefits and long term employee benefits recognised in the Statement of Profit and Loss and Balance Sheet as required in accordance with Accounting Standard (AS) 1 5 is as under:-

The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors, such as supply and demand in employee market.

(h) During the year, the Company has recognised an expense of Rs.1,522.45 lac (Previous Year Rs.1,353.21 lac) in respect of Contribution to Provident Fund and Rs.71.70 lac (Previous Year Rs.68.27 lac) in respect of Contribution to Superannuation Scheme.

13. The Company uses forward contracts and options to hedge its risk associated with fluctuation in foreign currency relating to foreign currency assets and liabilities, firm commitment and highly probable forecast transactions. The use of the aforesaid financial instruments is governed by the Company''s overall risk management strategy. The Company does not use forward contracts and options for speculative purposes. The details of the outstanding forward contracts and options as at 31st March 2014 is as under:

14. Previous Year''s figures have been recast/regrouped wherever necessary, to make these comparable with current year''s figures.


Mar 31, 2013

1. CORPORATE INFORMATION

Vardhman Textiles Limited (the Company) is a public company incorporated under the provisions of the Companies Act, 1956 on 8th October, 1973. The name of the company at its incorporation was Mahavir spinning mills Ltd. & subsequently changed to Vardhman Textiles Limited on 5th September, 2006. The company is engaged in manufacturing of Cotton Yarn, Synthetic Yarn & woven Fabric.

2. Contingent Liabilities and provisions (to the extent not provided for)

Particulars As at 31st March, 2013 As at 31st March, 2012 (Rs. in lac) (Rs. in lac)

I Contingent Liabilities

(i) Claims not acknowledged as debts 1,342.23 937.20

(ii) Bank Guarantees and Letters of Credit outstanding 22,612.40 16,581.71

(iii) Bills discounted with banks 4,176.64 8,289.88

(iv) Other monies for which the company is contingently liable

a) The Company has contested the additional demand in respect of Sales Tax, Excise Duty etc., amounting to Rs. 515.02 lac (Previous Year Rs. 554.49 lac). As against this a sum of Rs. 101.71 lac (Previous Year Rs. 155.85 lac) has been deposited under protest and stands included under the head "other recoverable in note-21 - Short-term loans and advances ". The Company has filed an appeal with the Appellate Authorities and is advised that the demand is not in accordance with law. No provision, therefore, has been made in accounts in respect thereof.

b) The Company has contested the additional demand in respect of income tax amounting to Rs. 5,036.00 lac (Previous Year Rs. 4,819.00 lac). Pending appeal with appellate authorities, provision of Rs. 2,323.00 lac (Previous Year Rs. 2,823.00 lac ) has not been made in the books of account as the company is confident to get the desired relief.

c) The company had taken over the textile undertaking of Vardhman Holdings Limited (formerly known as Vardhman Spinning & General Mills Limited) by a scheme of Arrangement and De-merger. An injunction was obtained against the London Branch of the said textile undertaking for preventing disposal of assets upto the value of Pound Sterling 2.99 Lac as a result of a court case pending in London for alleged non-fulfilment of an agreement of cotton purchase. The said matter had been decided against the said textile undertaking and accordingly, Pound Sterling 0.48 Lac lying in the bank account at London had been paid to the claimant pursuant to the Order of the Court. The said amount was written off in the books of the said undertaking by way of debit to the statement of Profit and Loss. No provision has been made for the balance decreed amount by the undertaking in view of the fact that the said undertaking was prevented by force majure in fulfilling its part of contract. The Company as successor to the textile undertaking is contesting this matter in Indian Courts and is confident that there would not be any further liability in this regard.

II Commitments

(i) Estimated amount of contracts remaining to be executed on 26,006.66 24,405.30 Capital Account and not provided for (net of advances)

(ii) Exports obligations under Export Promotion Nil 18,155.62 Capital Goods (EPCG) scheme#

# The Company has executed bonds for an aggregate amount of Rs. 120,916.00 lac (Previous Year Rs. 129,358.00 lac) in favour of the President of India under section 59 (2) and 67 of the Customs Act,1962 and Central Excise and salt Act, 1944 for fulfilment of the obligation under the said Acts.

3. The Company has provided depreciation on Computers @ 25% on straight line basis as the useful life of the computers has been estimated to be not more than four years.

4. Amortisation of Intangible assets

a. Softwares have been amortised @ 25% on straight line basis as the useful life has been estimated to be not more than four years.

b. Right to use power lines have been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

5. The Company is holding 15,98,741 (Previous year 15,98,741) equity shares of Vardhman Textiles Limited through a trust, which were received by it in its capacity as a shareholder of Vardhman Holdings Limited, in accordance with the ''Scheme of Arrangement and Demerger''. Further, during the year under consideration, the Trust has been allotted 3,19,748 equity shares by Vardhman Specials Steels Limited (VSSL) in the ratio of one equity share against every five equity shares held in the company in accordance with the ''Scheme of Arrangement and Demerger'' entered into by the company, VSSL and their respective shareholders and creditors . The said trust has been exclusively formed for the benefit of the company. As per the provision of the trust deed, all the money received by the trust (including dividend and the proceeds of the sale of shares) shall be paid forthwith to the company by the trust.

6. The company has provided the loss for outstanding derivative options on mark to market basis in the current financial year. The figures for the current financial year and the previous financial year may not be comparable.

7. Segment Information as required by Accounting Standard (AS)-17 on "Segment Reporting" issued by Companies (Accounting Standards) Rules 2006, has been compiled on the basis of the consolidated financial statements and is disclosed in the notes to accounts forming part of the consolidated financial statements in accordance with the above standard. Therefore segment information in respect of separate financial statements of the company is not being disclosed in the standalone financial statements.

8. In accordance with the Accounting Standard (AS)-28 on "Impairment of Assets" the Company has assessed as on the balance sheet date, whether there are any indications (listed in paragraphs 8 to 10 of the Standard) with regard to the impairment of any of the assets. Based on such assessment it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has not been made. Accordingly no impairment loss has been provided in the books of account.

9. Earning Per Share

The calculation of Earning Per Share (EPS) as disclosed in the statement of profit and loss has been made in accordance with Accounting Standard (AS)-20 on "Earning Per Share" issued by Companies (Accounting Standards) Rules, 2006.

A statement on calculation of basic EPS is as under:

10. Leases

The Company has leased facilities under cancellable and non-cancellable operating lease arrangements with a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses recognised during the year amounts to Rs. 88.37 lac (Previous Year Rs. 70.96 lac). The future minimum lease payments in respect of the non-cancellable operating leases are :

11. Related Party Disclosure

(a) Disclosure of Related Parties and relationship between the parties.

1. Subsidiaries VMT Spinning Company Limited

Vardhman Acrylics Limited

VTL Investments Limited

Vardhman Yarns and Threads Limited

Vardhman Special Steels Limited (upto 7th April, 2011)

Vardhman Nisshinbo Garments Company Limited (Formerly known as Vardhman Texgarments Ltd)

2. Associates Vardhman Textile Components Limited

Vardhman Spinning and General Mills Limited

Vardhman Special Steels Limited (w.e.f 8th April, 2011)

3. Key Management Personnel Mr. S.P. Oswal

Mr. Sachit Jain

Mrs. Suchita Jain

Mr. Neeraj Jain

4. Enterprises over which key Management Personnel and relative of such personnel is able to exercise significant influence or control

Vardhman Holdings Limited

Vardhman Apparels Limited

Smt. Banarso Devi Oswal Public Charitable Trust

Sri Aurobindo Socio Economic and Management Research Institute

*Adinath Investment and Trading Co.

*Devakar Investment and Trading Co. Limited

*Srestha Holdings Limited

*Santon Finance and Investment Co. Limited

*Flamingo Finance and Investment Co. Limited

*Ramaniya Finance and Investment Co. Limited

*Marshall Investment and Trading Co. (P) Limited

*Pardeep Mercantile Co. (P) Limited

*Plaza Trading Co. (P) Limited

*Anklesh Investments (P) Limited

*Syracuse Investment and Trading Co. (P) Limited

*Mahavir Spinning Mills (P) Ltd.

(Formerly known as Vardhman Textiles Processors (P) Limited) **Northern Trading Co.

**Ambar Syndicate **Paras Syndicate **Adinath Syndicate **Eastern Trading Company

Note: * Only Loan Transactions have taken place with these Companies. ** No transaction has taken place during the year.

12. Disclosure required by Clause 32 of Listing Agreement:

(i) The Company has given inter corporate deposits aggregating to Rs. 14,334.00 lac (Previous Year Rs.1 1,324.95 lac) to M/s Vardhman Acrylics Ltd. during the year. The maximum amount outstanding during the year was Rs. 1,190.50 lac (Previous Year Rs. 3,419.35 lac). The Balance outstanding as on 31.03.13 is Rs. Nil (Previous Year Rs. Nil).

(ii) The Company has given inter corporate deposits aggregating to Rs. 5,687.60 lac (Previous Year Rs. 8,900.85 lac) to M/s VMT Spinning Company Limited during the year. The maximum amount outstanding during the year was Rs. 1,620.55 lac (Previous Year Rs. 2,673.80 lac). The Balance outstanding as on 31.03.13 is Rs. Nil (Previous Year Rs. 1,260.55 lac).

(iii) The Company has given inter corporate deposits aggregating to Rs. 65,109.32 lac (Previous Year Rs. 1,125.00 lac) to M/s Vardhman Special Steels Limited. The maximum amount outstanding during the year was Rs. 8,210.00 lac (Previous Year Rs. 670.00 lac). The Balance outstanding as on 31.03.2013 is Rs. Nil lac (Previous Year Rs. 2,981.05 lac).

(iv) The Company has given inter corporate deposits aggregating to Rs. 1,724.00 lac (Previous Year Rs. 1,221.30 lac) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The maximum amount outstanding during the year was Rs. 1,424.40 lac (Previous Year Rs. 799.40 lac ). The Balance outstanding as on 31.03.13 is Rs. 1,373.40 (Previous Year Rs. 631.40 lac).

(v) The Company has given inter corporate deposits aggregating to Rs. Nil (Previous Year Rs. 500.00 lac) to M/s VTL Investments Limited during the year. The maximum amount outstanding during the year was Rs. Nil (Previous Year Rs. 500.00 lac). The Balance outstanding as on 31.03.13 is Rs. Nil (Previous Year Rs. Nil).

(vi) The Company has given inter corporate deposits aggregating to Rs. 3,261.75 lac (Previous Year Rs. 2,081.61 lac) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding during the year was Rs. 1,230.15 lac (Previous Year Rs. 685.72 lac). The Balance outstanding as on 31.03.13 is Rs. Nil (Previous Year Rs. Nil).

13. Figures in bracket indicate deductions.

14. Previous year''s figures have been recast/regrouped wherever necessary, to make these comparable with current year''s figures.

15. Employee Benefits

The summarized position of Post-employment benefits and long term employee benefits recognized in the Statement of Profit and Loss and Balance Sheet as required in accordance with Accounting Standard (AS) 15 is as under:-

(h) During the year, the company has recognized an expense of Rs. 1,353.21 Lac (Previous Year Rs. 1,166.23 lac) in respect of Contribution to Provident Fund and Rs. 68.27 Lac (Previous Year Rs. 67.66 Lac) in respect of Contribution to Superannuation Scheme.

16. The company uses forward contracts and options to hedge its risk associated with fluctuation in foreign currency relating to foreign currency assets and liabilities, firm commitment and highly probable forecast transactions. The use of the aforesaid financial instruments is governed by the company''s overall risk management strategy. The company does not use forward contracts and options for speculative purposes. The details of the outstanding forward contracts and options as at 31st March 2013 is as under:


Mar 31, 2012

1. CORPORATE INFORMATION

Vardhman Textiles Limited (The Company) is a public company incorporated under the provisions of the Companies Act, 1956 on 8th October, 1973. The name of the company at its incorporation was Mahavir Spinning Mills Limited and subsequently changed to Vardhman Textiles Limited on 5th September, 2006. The company is engaged in manufacturing of Cotton yarn, Synthetic yarn & Woven fabric.

a. Rights, preferences and restrictions attached to equity shares

The company has one class of equity shares having a par value of Rs.10/- each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting.

During the year ended March 31, 2012 the amount of per share dividend recognized as distributions to equity shareholders was Rs. 4.50 per share (Previous Year: Rs. 4.50).The rate of dividend for redeemable cumulative preference shares is decided by the board of directors as and when issued.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

b. Shares held by holding company or its ultimate holding company or subsidiaries or associates of the holding company or the ultimate holding company in aggregate.

There is no holding or ultimate holding company of the company.

a). Details of security for term loans

Term loans from banks are secured by mortgage created or to be created on all the immovable assets of the company, both present and future and hypothecation of all movable assets including movable machinery, machinery parts, tools and accessories and other movable both present and future (except book debts), subject to charges created or to be created in favor of the bankers for securing the working capital limits.

2. Contingent Liabilities and provisions (to the extent not provided for)

As at 31st As at 31st March, 2012 March, 2011

(Rs. in lacs) (Rs. in lacs)

I Contingent Liabilities

(i) Claims not acknowledged as debts 878.03 1,034.07

(Ii) Bank Guarantees and Letters of Credit outstanding 16,581.71 15,264.42

(iii) Bills discounted with banks 8,289.88 8,221.02

(iv) Other monies for which the company is contingently liable

a) The Company has contested the additional demand in respect of Sales Tax, Excise Duty etc., amounting to Rs. 613.66 lacs (Previous Year Rs. 572.85 lacs). As against this a sum of Rs. 200.74 lacs (Previous Year Rs. 201.39 lacs) has been deposited under protest and stands included under the head "Advances and other recoverable in cash or in kind". The Company has filed an appeal with the Appellate Authorities and is advised that the demand is not in accordance with law. No provision, therefore, has been made in accounts in respect thereof.

b) The Company has contested the additional demand in respect of income tax amounting to Rs. 4,819.00 lacs (previous Year Rs. 3,400.00 lacs). Pending appeal with Appellate Authorities, provision of Rs. 2,823.00 lacs (Previous Year Rs. 2,004.00 lacs) has not been made in the books of account as the company is confident to get the desired relief.

c) The company had taken over the textile undertaking of Vardhman Holdings Limited by a scheme of Arrangement and De-merger. An injunction was obtained against the London Branch of the said textile undertaking for preventing disposal of assets up to the value of Pound Sterling Rs. 2.99 lacs as a result of a court case pending in London for alleged non-fulfillment of an agreement of cotton purchase. The said matter had been decided against the textile undertaking and accordingly, Pound Sterling Rs. 0.48 lacs lying in the bank account at London had been paid to the claimant pursuant to the Order of the Court. The said amount was written off in the books of the said undertaking by way of debit to the statement of Profit and Loss Account. No provision has been made for the balance decreed amount in view of the fact that the said undertaking was prevented by force majure in fulfilling its part of contract. The Company as successor to the textile undertaking is contesting this matter in Indian Courts and is confident that there would not be any further liability in this regard.

II Commitments

(i) Estimated amount of contracts remaining to be executed on 24,405.30 44,710.72 Capital Account and not provided for (net of advances)

(ii) Exports obligations under Export Promotion 18,155.62 20,654.66 Capital Goods (EPCG) scheme#

# The Company has executed bonds for an aggregate amount of Rs. 18,155.62 lacs (previous Year Rs. 20,654.66 lacs) in favor of the President of India under section 59 (2) and 67 of the Customs Act, 1962 and Central Excise Act, 1944 for fulfillment of the obligation under the said Acts.

3. The Company has provided depreciation on Computers @ 25% on straight line basis as the useful life of the computers has been estimated to be not more than four years.

4. Amortization of Intangible assets

a. Softwares have been amortised @ 25% on straight line basis as the useful life has been estimated to be not more than four years.

b. Right to use power lines have been amortised @ 20% on straight line basis as the useful life thereof has been estimated to be not more than five years.

5. The Company is holding 15,98,741 (Previous year 15,98,741) equity shares of Vardhman Textiles Limited through a trust, which were received by it in its capacity as a shareholder of Vardhman Holdings Limited in accordance with the 'Scheme of Arrangement and Demerger'. Further, during the year under consideration, the Trust has been allotted 3,19,748 equity shares by Vardhman Specials Steels Limited (VSSL) in the ratio of one equity share against every five equity shares held in the company in accordance with the 'Scheme of Arrangement and Demerger' entered in to between the company, VSSL and their respective shareholders and creditors . The said trust has been exclusively formed for the benefit of the company. As per the provision of the trust deed, all the money received by the trust (including dividend and the proceeds of the sale of shares) shall be paid forthwith to the company by the trust.

6. The Company also hedges its foreign currency fluctuation exposure by way of foreign currency derivative options. The Company has taken various USD/INR options from banks. As at March 31, 2012, there are 10 options (Previous Year 15) against exports and 1 option (Previous Year 5) against Imports having a maturity period up to Feb.,2016 (Previous Year Jan 2016). These derivative options are proprietary products of banks which do not have a ready market and are not traceable in the open market. These options are marked to a model, which is bank specific instead of being marked to market. In view of the significant uncertainty associated with the above derivative options, the ultimate outcome of which depends on future events which are not under the direct control of the company, the resultant gain/loss if any, on such open derivative options cannot be determined at this stage and has accordingly not been accounted for in the books of account.

7. Segment Information as required by Accounting Standard (AS)-17 on "Segment Reporting" issued by Companies (Accounting Standards) Rules 2006, has been compiled on the basis of the consolidated financial statements and is disclosed in the notes to accounts forming part of the consolidated financial statements in accordance with the above standard. Therefore segment information in respect of separate financial statements of the company is not being disclosed in the stand alone financial statements.

8. In accordance with the Accounting Standard (AS)-28 on "Impairment of Assets", the Company has assessed as on the balance sheet date, whether there are any indications (listed in paragraphs 8 to 10 of the Standard) with regard to the impairment of any of the assets. Based on such assessment it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has not been made. Accordingly, no impairment loss has been provided in the books of account.

9. Earnings Per Share

(a) The calculation of Earnings Per Share (EPS) as disclosed in the statement of profit and loss has been made in accordance with Accounting Standard (AS)-20 on "Earning Per Share" issued by Companies (Accounting Standards) Rules, 2006.

(i) A statement on calculation of basic EPS is as under:

10. Leases

The Company has leased facilities under cancellable and non-cancellable operating leases arrangements with a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses recognized during the year amounts to Rs. 70.96 lacs (Previous Year Rs. 72.46 lacs). The future minimum lease payments in respect of the non-cancellable operating leases as at 31st March 2012 are:

11. In the year ended 31st March, 2011, pursuant to the Scheme of Arrangement and Demerger, the steel business undertaking of the company stands vested with Vardhman Special Steels Limited (VSSL) w.e.f. 1st January, 2011. The steel business was a separate reportable business segment and was being disclosed as such. The following table reflects the carrying values of the primary components of the discontinuing operations viz; assets, liabilities, revenue, expense, pretax profits, tax expense and cash flows for the period ended 31st December, 2010. The said information is required to be disclosed as per the requirements of Accounting Standard (AS)- 24 Discounting Operations issued by Companies (Accounting Standards) Rules, 2006.

The Scheme of Arrangement and Demerger provides for the issue and allotment of shares to the shareholders of the company by Vardhman Special Steels Ltd. in consideration of such demerger. There was no gain or loss involved in the transaction of Demerger.

12. Related Party Disclosure

(a) Disclosure of Related Parties and relationship between the parties.

1. Subsidiaries VMT Spinning Company Limited

Vardhman Acrylics Limited

VTL Investments Limited

Vardhman Yarns and Threads Limited

Vardhman Special Steels Limited (upto 7th April, 2011)

Vardhman Nisshinbo Garments Company Limited (Formerly known as Vardhman Texgarments Ltd)

13. Disclosure required by Clause 32 of Listing Agreement:

(i) The Company has given inter corporate deposits aggregating to Rs.1,132.50 lacs (Previous Year Rs.1,111.50 lacs) to M/s Vardhman Acrylics Ltd. during the year. The maximum amount outstanding during the year was Rs. 3,419.35 lacs (Previous Year Rs. 833.80 lacs). The balance outstanding as on 31.03.12 is Rs. Nil (Previous Year Rs. Nil).

(ii) The Company has given inter corporate deposits aggregating to Rs. 8,900.85 lacs (Previous Year Rs. 4,914.80 lacs) to M/s VMT Spinning Company Limited during the year. The maximum amount outstanding during the year was Rs. 2,673.80 lacs (Previous Year Rs. 2,195.30 lacs). The balance outstanding as on 31.03.12 is Rs. 1,260.55 lacs (Previous Year Rs. 1,104.30 lacs).

(iii) The Company has given inter corporate deposits aggregating to Rs. 1,125.00 lacs (Previous Year Rs. 8,121.83 lacs) to M/s Vardhman Special Steels Limited during the year up to 07.04.2011. The maximum amount outstanding during the year was Rs. 670.00 lacs (Previous Year Rs. 1,181.29 lacs). The balance outstanding as on 07.04.11 is Rs. 625.00 lacs (Previous Year Rs. Nil).

(iv) The Company has given inter corporate deposits aggregating to Rs. 1,221.30 lacs (Previous Year Rs. 567.60 lacs) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The maximum amount outstanding during the year was Rs. 799.40 lacs (Previous Year Rs. 455.00 lacs). The balance outstanding as on 31.03.12 is Rs. 631.40 lacs (Previous Year Rs. Nil).

(v) The Company has given inter corporate deposits aggregating to Rs. 500.00 lacs (Previous Year Rs. 4,287.00 lacs) to M/s VTL Investments Limited during the year. The maximum amount outstanding during the year was Rs. 500.00 lacs (Previous Year Rs. 2462.00 lacs). The balance outstanding as on 31.03.12 is Rs. Nil (Previous Year Rs. Nil).

(vi) The Company has given inter corporate deposits aggregating to Rs.2,081.61 lacs (Previous Year Rs. 4,287.00 lacs) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding during the year was Rs. 685.72 lacs (Previous Year Rs. 2,462.00 lacs). The balance outstanding as on 31.03.12 is Rs. Nil (Previous Year Rs. Nil).

14. Figures in bracket indicate deductions.

15. The financial statements for the year ended 31st March, 2012 have been prepared as per Revised Schedule-VI to the Companies Act, 1956. Accordingly the previous year figures have been reclassified to confirm to this year's classification.

16. Employee Benefits

The summarized position of Post-employment benefits and long term employee benefits recognized in the Profit and Loss Account and Balance Sheet as required in accordance with Accounting Standard (AS) 15 is as under:-

The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors, such as supply and demand in employee market.

(h) During the year, the company has recognized an expense of Rs. 1,166.23 Lacs (Previous Year Rs. 926.35 Lacs) in respect of Contribution to Provident Fund and Rs. 67.66 Lacs (Previous Year Rs. 63.83 Lacs) in respect of Contribution to Superannuation Scheme.

17. The company uses forward contracts and options to hedge its risk associated with fluctuation in foreign currency relating to foreign currency assets and liabilities, firm commitment and highly probable forecast transactions. The use of the aforesaid financial instruments is governed by the Company's overall strategy. The company does not use forward contracts and options for speculative purposes. The details of the outstanding forward contracts and options as at 31st March 2012 is as under:

 
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