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Notes to Accounts of Veto Switchgears & Cables Ltd.

Mar 31, 2015

Note 1 : In the opinion of the Board the Current Assets, Loans & Advances are realisable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

Note 2 : Depreciation

Effective from 1 st April, 2014 the Company has charged depreciation on its assets based on their useful life as stipulated under Schedule II of the Companies Act, 2013. Due to this, the depreciation for the year ended on 31st March, 2015 is lower by Rs 74.96 Lacs as compared to the depreciation computed under the provisions of the Companies Act, 1956. Further based on the transitional provisions in Note 7(b) of Schedule II, Rs. 2.77 Lacs (Net of Deferred Tax Rs. 1.88 Lakhs) is adjusted against opening balance of Retained Earnings

Note 3 : Contingent Liabilities

Particulars Year Ended Year Ended 31st March, 31st March, 2015 2014

a) Guarantees and L.C. given

Gaurantee given by bank on behalf of the Company 121.72 12.50

b) Disputed Liabilities

Tax matters in dispute under appeal 2.02

c) Estimated amount of contracts remaining to be executed on Capital Account (Net of Advance) 171.39 -

Total 295.12 12.50

Note 4 : Segmental Reporting

The Company is mainly engaged in the business of manufacturing and trading of Wires, Cables & Electrical Accessories and there is no other reportable business segment as per Accounting Standard (AS-17) "Segment Reporting"

Note 5 : Related Party Disclosure:-

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are the details of transactions during the year with the related parties of the Company as defined in AS 18 :

a. List of related parties Key Management Personnel

Mohan Das Gurnani (Upto 27/08/2014) Chairman

Vishnu Kumar Gurnani (Upto 19/05/2014) Managing Director

Akshay Gurnani (From 27/08/2014) Managing Director

Dinesh Gurnani Whole Time Director & CFO

Jyoti Gurnani Director

Ms. Diya Singh (Upto 14/11/2014) Company Secretary

Ms. Chavi Rawat (From 01/11/2014) Company Secretary

ii) Relative of Directors

Kishore Kumar Gurnani

Pushpa Gurnani

Jyoti Gurnani

iii) Holding Company

Veto Electropower (India) Private Limited

iv) Subsidiary Companies Veto Electricals Private Limited

v) Enterprises owned or significantly influenced by Key Management Personnel and / or their Relatives with whom the Company has entered into transaction

Vimal Power Cables Private Limited

Veto Electro Power (India) Private Limited

Veto Electric Components Private Limited

Pinkcity Buildhome Private Limited

Pink Square Infra Developers Private Limited

Gurnani Infra Developer Private Limited

Tulsi Palace Resort Private Limited

Kripa Rea! Mart Private Limited

Pink square Real Estate Private Limited

Veto Electric Private Limited

Vankon Switchgears & Cables Private Limited

Veto Powers

Anjali Packaging

Gurnani Industries

Yashodevi Raichand Gurnani Trust

Note 6 : The Company had raised an amount of Rs. 2500.50 Lacs through an IPO of equity shares during the financial year 2012- 13, by way of 50.01 lacs Equity Shares of Rs 10/- at a premium of Rs 40/- per share. The said proceeds has been fully utilised during the current year in terms of the offer document for the purpose of modernisation of existing production facilities , working capital requirements, brand building and meeting IPO expenses.

Note 7 : A major fire had occurred at one of the rental warehouse of the Company on May 19, 2014. Stock of finished goods / stock in trade amounting Rs. 1652.01 lacs was destroyed in the fire. Further in respect to damages to the leasehold premises and improvement there at, the Company has made provision for the reinstatement value of Rs. 207.23 lacs which was destroyed in the fire. The Company has also incurred Rs. 9.79 Lacs towards various expenses related to the fire. The Company has lodged a claim for insurance for the above losses amounting to Rs.1669.03 Lacs net of salvage value of Rs. 200 lacs.

Note 8 : Corporate Social Responsibility

During the year, the Company has started various initiative towards CSR and spent Rs. 13.86/- lacs (as stated below) as against Rs. 15.73/- lacs as required by section 135 read with Schedule VII of the Companies Act 2013.

Note 9 : Post Balance Sheet Event

The equity shares of the Company are listed on SME Platform of NSE i.e. EMERGE. However w.e.f. April 29, 2015 the equity shares of the Company has been migrated from NSE SME Platform to Main Board of NSE.

Note 10 : Previous year's figure's have been re-grouped, re-arranged & re-classified, wherever considered necessary, to confirm the current period figures.

Note 11 : Figures less than Rs. 500/- have been shown at actuals wherever statutory required to be disclosed since figures have been rounded off to the nearest thousands.


Mar 31, 2014

A) Terms / rights attached to equity shares

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

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

Additional information pursuant to long term borrowings:

a) Rs. 14.70 lacs (PY Rs. 23.79 lacs) term loan from Indian Oversease Bank carries interest @ Base rate 2.50% p.a. The loan is repayable in 60 Monthly instalments along with interest starting from January, 2011. The loan is secured by way of equitable mortgage of factory building and hypothecation of plant & machinery and personal guarantee of four directors.

b) Rs. 604.06 lacs (PY Rs. Nil) term loan from Indian Overseas Bank carries interest @ Base rate 2.75% p.a.. The loan is repayable in 20 Quaterly instalments along with interest starting from June, 2015. The loan is secured by way of equitable mortgage of land and building and personal guarantee of four directors.

c) Rs 47.95 lacs (PY Rs. 65.92 lacs) hire purchase loans carries interest @ between 9% to 11% p.a. The loans are repayable in 36 to 60 equal monthly instalments starting from the respective date of finance. The loan are secured by hypothecation of vehicles financed.

In pursuance of Accounting Standard- 29 (AS 29) ''Provisions, Contingent Liabilities and Assets'',the provision required have been incorporated in the books of accounts in the following manner

A provision is recognised for expected warranty claims on products sold during the year, based on past experience of the level of repairs and returns. It is expected that significant portion of these costs will be incurred in the next financial year and all will have been incurred within two years after the reporting date. Assumptions used to calculate the provisions for warranties were based on current sales levels and current information available about returns based warranty period for all products sold. The table below gives information about movement in warranty provisions.

* Earning per share (EPS) is calculated after adjusting for 16.66 lacs bonus shares issued, with retrospective effect as provided in Accounting Standard (AS-20) - Earning Per Share prescribed by the Companies (Accounting Standard) Rules 2006.

Note 2 : In the opinion of the Board the Current Assets, Loans & Advances are realisable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

Note 3 : Contingent Liabilities

Year Ended Year Ended Particulars 31st March, 2014 31st March, 2013

Gaurantee given by bank on behalf of the Company 12.50 12.50

Estimated amount of contracts remaining to be executed on Capital Account (Net of Advance)- - 43.98

Total 12.50 56.48

Note 4: Segmental Reporting :

The Company is mainly engaged in the business of manufacturing and trading of Wires, Cables & Electrical Accessories and there is no other reportable business segment as per Accounting Standard (AS-17).

Note 5 : Related Party Disclosure:-

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are the details of transactions during the year with the related parties of the Company as defined in AS 18 :

a.List of related parties

Name of the Party i) Directors

Vishnu Kumar Gurnani Dinesh Gurnani

ii) Relative of Directors

Ragini Gurnani Kishore Kumar Gurnani Pushpa Gurnani Jyoti Gurnani

iii) Holding Company

Veto Electropower (India) Private Limited

iv) Subsidiary Companies

Veto Electricals Private Limited

v) Enterprises owned or significantly influenced by Key Management Personnel and / or their Relatives

Poonam Industries

Veto Powers

Anjali Packaging

Jai Enterprises

Vimal Power Cables Private Limited

Pinkcity Buildhome Private Limited

Gurnani Industries

Yashodevi Raichand Gurnani Trust

Gurnani Infra Developer Private Limited

Veto Electric Components Private Limited

Pink Square Infra Developers Private Limited

Vankon Switchgears and Cables Limited

Note 6 :

The Company has raised an amount of Rs. 2500.50 Lacs through a public issue of equity shares in the previous year Out of the said proceeds and in terms of the offer document an amount of Rs 2305.85 lacs has been deployed partly in modernisation of existing production facilities, working capital requirements brand building and meeting IPO expenses. The balance of Rs 194.65 lacs have been temporarily invested invested deposits with banks.

Note 7 : Post Balance Sheet Event

There was a major fire at one of the Warehouse of the Company located in Jaipur on May 19,2014 causing extensive damage to Stock and Building. These assets were fully insured and claim has been duly lodged by the Company. The estimated loss by the Company is approximately Rs. 2200.00 lacs.

Note 8

Previous year''s figure''s have been re-grouped, re-arranged & re-classified, wherever considered necessary, to confirm the current period figures.

Note 9

Figures less than Rs. 500/- have been shown at actuals wherever statutory required to be disclosed since figures have been rounded off to the nearest thousands.


Mar 31, 2013

Note 1 : In the opinion of the Board the Current Assets, Loans & Advances are realisable in the ordinary course of business at least equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

Note 2 : Some of the Trade Receivables, Trade Payables, Loans and advances and other current and non current are subject to confirmation and reconciliation. Consequential adjustment thereof, if any, will be given effect into the books of accounts in the year of such adjustment.

Note 3 : Contingent Liabilities

Year Ended 31st Year Ended Particulars March, 2013 31st March, 2012

Guarantee given by bank on behalf of the Company 12.50 4.50

Estimated amount of contracts remaining to be executed on CapitalAccount (Net of Advance) 39.23 5.25

Total 51.731 9.75

Note 4 : Segmental Reporting :

The Company is mainly engaged in the business of manufacturing and trading of Wires, Cables & Electrical Accessories and there is no other reportable business segment as per Accounting Standard (AS-17) issued by The Institute of Chartered Accountants of India.

Note 5: Related Party Disclosure:-

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are the details of transactions during the year with the related parties of the Company as defined in AS 18 :

a.List of related parties

Name of the Party i) Directors

Vishnu Kumar Gurnani

Dinesh Gurnani

Mohan Das Gurnani (from 22/08/2012)

Narayan Das Gurnani (upto 04/08/2012)

ii) Relative of Directors

Babulal Guranani

Ragini Gurnani

Kishore Kumar Gurnani

Pushpa Gurnani

Jyoti Gurnani

iii) Holding Company

Veto Electropower (India) Private Limited

iv) Subsidiary Companies

Veto Electricals Private Limited

Vankon Switchgears and Cables Private Limited (upto 19.10.2012)

Veto Lightings Private Limited (upto 19.10.2012)

v) Enterprises owned or significantly influenced by Key Management Personnel and / or their Relatives

Poonam Industries

Veto Powers

Anjali Packaging

Jai Enterprises

Vimal Power Cables Private Limited

Veto Lightings Private Limited (from

Pinkcity Buildhome Private Limited

Gurnani Industries

Yashodevi Raichand Gurnani Trust

Gurnani Infra Developer Private Limited

Note 6:

i) During the year, in order to comply with the Accounting Standard (AS) 15 (Revised 2005) "Employee Benefits" as notified by the Companies (Accounting Standard) Rules 2006, the method of accounting of Gratuity has been changed from cash basis to accrual basis of accounting. Gratuity has been provided on the basis of actuarial valuation. Due to change in this accounting policy, the profit before tax for the year is lower by Rs. 19.90 lacs having consequential effect on the Reserves and Surplus and Current Assets. As per the Guidance on Implementing Accounting Standard (AS) 15, Employee Benefits (Revised 2005), issued by the Accounting Standard Board of the Institute of Chatered Accountants of India, the liability upto the previous year i.e. 31st March, 2012 amounting to Rs. 24.48 lacs has been reflected as a Prior Period Items.

ii) The Company has also changed the method of accounting for provision of warranty from cash basis to accrual basis of accounting in order to comply with Accounting Standard (AS) 29 " Provisions, Contingent Liabilities and Contingent Assets" as notified by the Companies (Accounting Standard) Rule 2006. Due to change in this accounting policy, the profit before tax for the period is lower by Rs. 1.94 lacs having consequential effect on the Reserves and Surplus and Long term provisions.

Note 7:

The Company has been converted into a Public Limited Company and accordingly the name of the Company has been changed to Veto Switchgears & Cables Limited from Veto Switchgears & Cables Private Limited and fresh certificate of incorporation dated 3rd August, 2012 has been received from Registrar of Company, Maharashtra.

Note 8 : The Company has raised an amount of Rs. 2500.50 Lacs through an IPO of equity shares during the year by way of 50.01 lacs Equity Shares of Rs 10/- at a premium of Rs 40/- per share. Out of the said proceeds and in terms of the offer document an amount of Rs 1889.54 lacs has been deployed partly in modernisation of existing production facilities , working capital requirements, brand building and meeting IPO expenses. The balance of Rs 610.96 lacs have been temporarily invested in fixed deposits with banks.

Note 9 : Previous year''s figure''s have been re-grouped, re-arranged & re-classified, wherever considered necessary, to confirm the current period figures.

Note 10 : Figures less than Rs. 500/- have been shown at actuals wherever statutory required to be disclosed since figures have been rounded off to the nearest thousands.

 
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